Did Your Doctor ‘Ghost’ You? An Employment Contract May Be To Blame

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Source: Kaiser Health News

When Don Cue developed a bladder infection last fall, he called his longtime urologist’s office for a urine culture and antibiotics. It was a familiar routine for the two-time prostate cancer survivor; infections were not uncommon since he began using a catheter that connects to his bladder through an incision in his abdomen.

When Cue called this time, a receptionist told him that his physician, Dr. Mark Kellerman, no longer worked at the Iowa Clinic in Des Moines, a large multi-specialty group. She refused to divulge where he’d gone.

“As a patient, ‘scared’ is too strong a word, but my feeling is, ‘What do I do now?’” said Cue, 58.

Flummoxed, he solved his immediate problem by taking leftover antibiotics he had in his medicine cabinet.

It was only later that he learned his doctor had been fired by the Iowa Clinic and planned to start a urology practice with clinic colleagues. And, under the terms of their contract with their former employer, the doctors were banned for a year from practicing within 35 miles of the clinic and from recruiting former patients to follow them.

Contracts with so-called restrictive covenants are now common in medicine, although some states limit their use. Noncompete clauses — common in many commercial sectors — aim to stop physicians or other health care professionals from taking patients with them if they move to a competing practice nearby or start their own. But what may be good for business is bad for patient care — and certainly disquieting for those whose doctors simply disappear.

One survey of nearly 2,000 primary care physicians in five states found that roughly 45 percent were bound by such clauses.

Continuity of care is important, doctors say, especially for patients with ongoing medical issues. Cutting off access to a doctor is different from disrupting someone’s relationship with a favorite hairstylist or money manager, they say.

“When doctors want to move from one practice to another, if they’ve got good therapeutic relationships with their patients, you’d think that public policy would want them to continue to treat these patients that trust them,” said Judy Conti, government affairs director at the National Employment Law Project.

Charlie Wittmack, a lawyer at Hartung Schroeder in Des Moines, is representing Kellerman and the two other urologists who were also fired in a lawsuit against the Iowa Clinic. The wrongful termination suit asks the court to declare the physicians’ restrictive covenant provisions unenforceable. Wittmack said the controversy there was “tragic” for patients. “These are people who have prostate cancer or are in extreme pain because of kidney stones or have blood in their urine.”

Ed Brown, the clinic’s CEO, said the noncompete agreements are not just about business but also help ensure that the Iowa Clinic can provide reliable services.

“Noncompetes are good for the patients because they help to provide stability within a practice and ensure continuity of care,” Brown said recently in an email. Further, he added, noncompetes protect physicians by ensuring that other physicians in the practice are committed to the same agreement and can’t abandon it without proper notice.

The urologists “believe they can make more money elsewhere, and they don’t want to be held to any contractual responsibilities,” he said.

Even when longtime patients go sleuthing to find their doctors’ new offices, they may not be accepted into those practices. Hospitals and clinics say they have little choice but to respect the terms of business agreements that others have negotiated.

UW Health, the health care system for the University of Wisconsin-Madison, recently hired three primary care doctors who had worked across town, said Dr. Sandra Kamnetz, vice chairwoman of clinical care for the Department of Family Medicine and Community Health at the University of Wisconsin’s School of Medicine and Public Health. They are taking great pains not to treat any of the new doctors’ former patients because the terms of the doctors’ contracts with their old employer prohibit them from taking care of former patients for two years.

Staff at the UW clinics ask prospective patients if they’ve ever been seen by one of the doctors. They then check the patient’s electronic health record to confirm there are no messages, prescription refills or other recent contact with the new UW Health doctors and that patient at the previous job, said Kamnetz.

“Patients get frustrated, but what they may not understand is that this is a legal thing that we have to abide by,” she said.

Whether noncompete clauses are binding in health care — especially when patient care is disrupted — is a point legal scholars debate. In general, to be enforceable, the agreements must be reasonable and narrowly drawn so that they protect an employer’s legitimate business interest but don’t unduly restrict a doctor’s ability to make a living.

Courts may weigh whether enforcing a noncompete clause would create a physician shortage in a particular region or specialty. The guiding principle is patient choice, said David J. Clark, a partner in the New York office of the law firm Epstein Becker Green who has analyzed state noncompete statutes in health care.

“No court is going to deny a patient who wants to go see a doctor of her choice,” Clark said.

Most disputes are settled before they make it to court, however.

A recent report by the Trump administration evaluating how to promote choice and competition in health care recommended that states examine noncompete agreements for their effect on patients’ access to care and the supply of providers.

Several states, including Massachusetts and Colorado, that allow noncompete clauses in employment contracts generally won’t enforce them against doctors, according to Clark’s analysis.

Other states, such as Texas and Tennessee, place limits on the agreements. In Texas, for example, a noncompete pact must allow doctors to have access to a list of their patients in the past year and access to their medical records, among other things, Clark found.

Medical board rules take it a step further. “In Texas, when a physician leaves, the practice is required to cooperate with a physician who wants to put up a notice that says this is where that physician can now be contacted,” said Kathy Poppitt, a partner in the health care and government and internal investigations practices at the Austin, Texas, office of King & Spalding.

The American Medical Association, which represents doctors, doesn’t oppose restrictive covenants outright, although its policy notes they can limit patients’ choices. “To the extent that these agreements disrupt continuity of care and disrupt patient choice, this is of great concern to the AMA,” said Dr. Patrice Harris, the organization’s president-elect.

For patients in central Iowa, the departures of longtime urologists at the Iowa Clinic is dizzying. After Kellerman and his colleagues left, five of the clinic’s remaining seven urologists submitted their resignations. They are also subject to noncompete restrictions. They left the practice in mid-February.

Brown, the clinic CEO, said the urology department has replaced four of the eight urologists and has nine nurse practitioners or physician assistants to treat patients. The clinic is continuing to recruit physicians and advanced practice providers like nurse practitioners.

Susan Murphy, 72, has seen a number of doctors in the urology department. Dr. Richard Glowacki, one of the urologists who left with Kellerman, performed surgery to remove her kidney stones more than a decade ago. Another, Dr. Stephanie Pothoven, did surgery to repair her prolapsed uterus a few years ago.

Murphy said she got a letter from Pothoven announcing her departure. It didn’t provide details about where she would be going.

“I’ve got it etched in my brain to find out where they went,” she said. She has no plans to return to the Iowa Clinic. “Somehow they lost sight of patient care and were more concerned about the bottom line,” she said.

Health System Consolidation: Can Employer Groups, Brokers Survive It?

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Source: Benefits Pro

Health care systems have been buying up one another, and physician practices, at an alarming rate. The 115 announced health care system deals in 2017 was a record, with 2018’s 90 close behind.

This level of consolidation activity 2017 “shook the health care landscape,” said consulting firm Kaufman Hall, which produces an annual mergers and acquisitions review. “These tremors continued into 2018 and are beginning to fundamentally reshape the health care landscape,” KH said in its 2018 review.

The consolidation within the physician practice sector was no less titanic. Hospital systems acquired more than 5,000 standalone practices in 2015 and 2016 alone. Meantime, practices are also being swallowed up by UnitedHealthcare and other non-hospital enterprises.

Analysts tend to focus on two major outcomes of this consolidation craze: financial and quality of care. So far, evidence suggests that consolidation among health care systems leads to higher prices for services and thus costs to users, and stable or lower quality of care.

These trends are not the friends of two very specific groups: health insurance brokers, and employer groups created to negotiate better terms for their members with hospitals.
“It is frustrating,” admits Brian Marcotte, CEO, The National Business Group on Health. “Scale for the sake of scale leads to higher costs, and that’s what we are seeing. When we look at what actually happens when hospitals buy hospitals or physician groups, we see higher cost and price.”

One of the primary objectives of NBGH’s 435 enterprise level members–all of which are self insured–has been to negotiate better terms with medical providers. As consolidation creates ever larger health care systems, its members report that “consolidation has not led to the efficiencies you’d see in other industries. … Most report that costs went up or were unchanged. Very few saw them go down.”

Employer groups are promoting Centers of Excellence and encouraging plan members to seek care from top performing practitioners. But consolidation among hospitals can erode quality of care for employer plan members by bringing into an existing system underperforming hospitals and physicians, Marcotte says.

“Let’s say you have a 12-hospital system that dominates a market or several markets,” he says. “The health plan is looking to contract with eight higher performing hospitals, but not all 12. The hospital system’s negotiating position is, ‘You take the whole system or you don’t get any of our system.’ These are the tactics that go on when providers are dominating a particular market.”

The decline of bargaining power
Smaller employers that band together into health care purchasing groups lose negotiating power when consolidation sweeps through a market. Employer groups negotiate locally or regionally for terms for their members with hospital systems. Their cache is numbers: They guarantee a large number of patients in exchange for favorable terms.

But, says Den Bishop, president, Holmes Murphy, an insurance advisor, as the systems expand, the group’s bargaining power diminishes.

Meantime, consolidation among physician practices is driving costs up for plan members. Physicians are highly incentivized to merge practices and then sell to a health care system. “They want to get out from under the administrative burden and just practice medicine,” Bishop says. “As soon as they buy the practice, the hospital system goes to the insurance company and says, ‘Our contract rate is much higher than the physicians, so you will now pay us this rate.’ That rate gets passed on to the employer. By paying higher prices for physician services, employers are paying the acquisition price for the hospital.”

In Atlanta not long ago, a major health system purchased a large physician practice–and employer plan costs for those physicians increased 40 percent, says Suzannah Gill, benefits strategy consultant with EPIC in Atlanta. “Sadly, when hospitals buys practices, the hospital wins and the member loses,” she says.

The national movement toward greater price and cost transparency among providers faces a threat from consolidation, Marcotte and others say. As systems expand, “you see a reluctance to have a price listed in transparency tools,” Marcotte says. “They refuse to list their prices, effectively eliminating any real ability for a consumer to choose a cost effective site of service.”

Josh Luke, MD, a former hospital CEO who now writes and lectures on hospital system strategies, believes the transparency issue may prove to be a turning point battleground for hospitals.

“There’s a transparency movement uprising coming with overall health and cost,” he says. “That momentum will be tough for any market to turn away from. Pricing transparency may outweigh a monopoly’s ability to gouge employers.”

Broker adaptation
On the broker side, a major threat to traditional brokers comes from the hospitals themselves. As they expand, many are moving into the health insurance business.

“The hospital systems are moving quickly, while they still have the most money, to compete with insurers. They are becoming insurers,” says Luke. “The bottom line is that is the [hospital] model of the future is an insurance model.”

To adapt to this new model, brokers need to become advisors and consultants to their clients. Their role may revolve more around transparency, advising clients on negotiating specific terms with health care systems, guiding them through the opaque pricing lens hospitals have thrown up.

Longer term, the health care system as insurer could have a positive effect on plan design and cost, several experts agree. The insurance component of a hospital system benefits from a healthier patient population, on more efficient use of services and facilities, and on a leaner brick-and-mortar footprint. These systems will focus more on convenience for patients and on value-based cost structures, and will be more responsive to negotiating with large employer groups.

“If the hospital system becomes big enough, it can negotiate directly with employers,” Bishop says. “They don’t need the insurance broker. The great hope [for employers] is that the hospital companies become insurers and have an incentive to provide better quality at a lower cost. It is still a ways off. We are in the cocoon period right now.”

EPIC’s Gill agrees that hospital systems that branch out into insurance will seek to contain the costs of medical care. “Health care providers have an incentive to increase costs. Insurance carriers have incentives to reduce or maintain costs. So when a health system develops an insurance business, there are incentives for them to do things efficiently,” she says.

The broker/advisor can play a crucial role in a consolidating market, Gill and others say.

“Employers need advisors to guide them today. They are focused on running their business, so you are seeing more advisors introducing interesting, cutting edge practices to meet their needs,” she says. “Sometimes when you tell a provider or facility, ‘My client will pay on the spot and you won’t have to worry about collections later,’ [the health care provider] will take it. I see all of the changes as very good for the broker/advisor market. The market is evolving, becoming more complex, and that’s where employers turn to brokers for guidance.”

The overall effects of hospital consolidation in a major market “are probably indifferent to most forward-thinking brokers,” says Allison De Paoili, founder and owner, De Paoli Professional Services, San Antonio. “But in the smaller markets, where you have two health systems that merge, then you have a problem,” she says. “With no competition, there is no incentive to negotiate price.”

In the end, the final chapters on health system consolidation have yet to be written. The merger frenzy of the past two years is still working itself out. As hospital systems seek market domination, creative brokers, concerned large employers, and national organizations like NBGH are still developing their responses.

Pockets of positive physician practice and hospital system consolidation do exist, NBGH’s Marcotte says. The hospital-as-insurer places the parent company in a position to accept some of the risks, he says, and that’s where innovation and efficiencies will emerge. It’s mostly happening on the Medicare Advantage side, but could translate to commercial insurance, he says.

“What I worry about with provider consolidation is when I have the whole market, I have no incentive to move to a value based direction, unless I have to do it to get paid differently,” he says.

Total market domination may be the goal of health systems. But it could also be their undoing.

“When there’s a monopoly, people will walk away,” says Josh Luke. “People are getting fed up. The public pressure is starting to rival the doctor and hospital lobby. Major employers, like Disney and Amazon, are saying ‘We are gonna blow it up and start over.’ Hospitals haven’t started feeling the pain yet. But it’s coming.”

Health Care and Insurance Industries Mobilize to Kill ‘Medicare for All’

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Source: New York Times

Even before Democrats finish drafting bills to create a single-payer health care system, the health care and insurance industries have assembled a small army of lobbyists to kill “Medicare for all,” an idea that is mocked publicly but is being greeted privately with increasing seriousness.

Doctors, hospitals, drug companies and insurers are intent on strangling Medicare for all before it advances from an aspirational slogan to a legislative agenda item. They have hired a top lieutenant in Hillary Clinton’s 2016 presidential campaign to spearhead the effort. And their tactics will show Democrats what they are up against as the party drifts to the left on health care.

They also demonstrate how entrenched the Democrats’ last big health care victory, the Affordable Care Act, has become in the nation’s health care system.

The lobbyists’ message is simple: The Affordable Care Act is working reasonably well and should be improved, not repealed by Republicans or replaced by Democrats with a big new public program. More than 155 million Americans have employer-sponsored health coverage. They like it, by and large, and should be allowed to keep it.

“We have a structure that frankly works for most Americans,” said Charles N. Kahn III, the president of the Federation of American Hospitals, which represents investor-owned hospitals. “Let’s make it work for all Americans. We reject the notion that we need to turn the whole apple cart over and start all over again.”

The Democrats’ proposals could radically change the way health care providers do business and could drastically shrink the role and the revenues of insurers, depending on how a single-payer system is devised.

The hospital federation and two powerful lobbies, America’s Health Insurance Plans and the Pharmaceutical Research and Manufacturers of America, created a coalition last June to pre-empt what they saw as an alarming groundswell of interest in proposals to expand the federal role in health care.

In a daily fusillade of digital advertising, videos and Twitter posts, the coalition, the Partnership for America’s Health Care Future, says that Medicare for all will require tax increases and give politicians and bureaucrats control of medical decisions now made by doctors and patients — arguments that echo those made to stop Medicare in the 1960s, Mrs. Clinton’s health plan in 1993 and the Affordable Care Act a decade ago.

The coalition will step up the tempo in the coming week as Democrats in the House and the Senate plan to introduce bills to establish a single-payer system.

The name of the coalition is intentionally nondescript, and its executive director, Lauren Crawford Shaver, who led Mrs. Clinton’s efforts in 2016 to put marginal states into play, is cagey when asked for details. She says only that the group is planning “a big nationwide effort” with grass-roots allies.

But its reach is undeniable. The coalition has picked up more than 25 members, including the American Medical Association, the American Hospital Association and the nation’s Blue Cross and Blue Shield plans.

And it has already sprung into action.

When Senator Bernie Sanders, the author of the Medicare for All Act, announced on Tuesday that he was again running for president, the coalition immediately attacked him as “a leading advocate for upending our nation’s health care system in favor of starting from scratch with Medicare for all.”

Mr. Sanders, independent of Vermont, fired back at the insurance and drug companies. “They make tens of billions of dollars a year in profits from this dysfunctional health care system and pay their C.E.O.s outrageous compensation packages,” Mr. Sanders said. “We’ve expected their opposition all along.”

When members of Congress unveiled legislation to let people age 50 to 64 buy into Medicare, the coalition conflated it with proposals to put all Americans into Medicare.

“This is a slippery slope to government-run health care for every American,” said David Merritt, an executive vice president of America’s Health Insurance Plans, a lobby for insurers.

The buy-in proposal for older Americans dates back to Bill Clinton’s presidency, and many of its advocates have put it forward as a moderate alternative to Medicare for all.

But the coalition said the proposal was wrong for America, “whether you call it Medicare for all, Medicare buy-in, single payer or a public option.”

The chief sponsor of the House buy-in bill, Representative Brian Higgins, Democrat of New York, said: “The critics lump our bill with the bigger Medicare-for-all proposal. That’s strategic, and I think it’s deliberate.”

Mr. Higgins said the option of Medicare at age 50 would create “a countervailing force to private insurance.”

“Insurance companies are fighting it because they are afraid of the prospect of a potent new competitor that will cut into their profits,” Mr. Higgins said. “Medicare has lower administrative costs and lower executive salaries and could use its bargaining power to get better deals from hospitals and other health care providers.”

Senator Debbie Stabenow, Democrat of Michigan and the sponsor of the buy-in bill in the Senate, said she was not surprised at the criticism. “It’s a knee-jerk reaction to anything that expands Medicare,” she said.

But, she said, people 50 to 64 need the option.

“We see the auto industry laying people off, encouraging people to retire early,” Ms. Stabenow said. “Many people are holding their breath until they turn 65. They put off preventive screenings, so they come into Medicare at 65 with more health problems.”

Under the Affordable Care Act, insurers can increase premiums with a person’s age, and older people who do not qualify for subsidies face the highest premiums on the insurance exchange. For a 60-year-old in Charlotte, N.C., the average premium for a midlevel silver plan is more than $1,100 a month; in Phoenix, it is nearly $1,000 a month.

The mission of the industry partnership includes advocacy, advertising, lobbying and public education, but it has not registered under federal lobbying laws. Forbes Tate, a public affairs company that lobbies for many health care and drug companies, coordinates the work of the partnership, but is not registered to lobby on its behalf.

“There are no direct lobbyists for the partnership,” Ms. Shaver said. “We work through all of our different groups. They have their own lobbyists who do obviously lobby on Medicare for all. But there are no registered lobbyists for the partnership because we are not doing that directly at this time.”

The coalition, like President Trump, attacks any proposals that smack of socialized medicine. But it also has a positive agenda. It wants to expand Medicaid under the Affordable Care Act in Texas, Florida and other states that have yet to do so. It wants to expand federal subsidies under the health law so insurance will be affordable to more people. And it wants to stabilize premiums by persuading states to set up reinsurance programs, using a combination of federal and state funds to help pay the largest claims.

Beyond their desire to preserve the status quo, coalition members have done well by the Affordable Care Act. Many participants, such as the American Medical Association, the pharmaceuticals lobby and the hospital association, backed the A.C.A. from the start, banking that more insured Americans would mean more customers. The hospitals saw the health law’s Medicaid expansion as a lifeline as they struggled with the uninsured working poor.

Others, like the National Retail Federation, opposed the A.C.A. but have tried to make it work.

The need to bolster the Affordable Care Act will become even more urgent, the coalition says, if Texas and other states succeed in their lawsuit to invalidate the entire law.

Even without legislation to expand Medicare, the program is sure to grow because of the aging of the baby boom generation. The number of Medicare beneficiaries, 60 million today, is expected to top 75 million within a decade. The Congressional Budget Office estimates that Medicare spending will grow under current law to $1.5 trillion in 2029, double the total projected for this year.

E. Neil Trautwein, the vice president for health care policy at the retail federation, which represents companies like Walmart, McDonald’s and Amazon, said his top priority was to protect the stability of the coverage that employers provide to employees.

“We are trying to understand what will be coming at us,” Mr. Trautwein said. “Proposals on the left and the right, in Congress and on the campaign trail, could blow up the employer-based health care system that has worked pretty well for more than 60 years.”

The version of Medicare for all proposed by Mr. Sanders in 2017 could disrupt that coverage. It would expand the list of items and services covered by Medicare and would prohibit employers from duplicating any of those benefits.

When Mr. Sanders introduced that bill, it was endorsed by several Democratic senators who have since become candidates for the party’s presidential nomination: Cory Booker of New Jersey, Kirsten Gillibrand of New York, Kamala Harris of California and Elizabeth Warren of Massachusetts.

The more modest Medicare buy-in bill has been endorsed by Mr. Booker, Ms. Gillibrand and Ms. Harris, as well as by another Democratic candidate for president, Senator Amy Klobuchar of Minnesota, and a potential candidate, Senator Sherrod Brown of Ohio.

Yet another Democratic proposal, allowing states to create a Medicaid buy-in program for all their residents, regardless of income, has won support from 23 senators, including Mr. Booker, Mr. Brown, Ms. Gillibrand, Ms. Harris, Ms. Klobuchar and Ms. Warren.

Members of the coalition had different positions in the struggle to pass the Affordable Care Act in 2009 and 2010, but rave about it today. Ten million people have coverage through the exchanges, 14 million have gained Medicaid coverage, and in a strong economy more people have jobs that provide health insurance, they say.

Some members of the coalition have financial as well as philosophical reasons for resisting the push to expand Medicare. Doctors and hospitals say Medicare generally pays less than private insurance, and hospitals say the payments frequently do not cover the costs of providing care to Medicare patients.

“Chronic underpayment to providers creates access issues for seniors, particularly with physicians, who may limit the number of Medicare patients they see,” said Richard J. Pollack, the president of the American Hospital Association. Congress, he said, often makes changes in Medicare for reasons that have nothing to do with sound health policy — to offset the costs of tax cuts, for example.

Moreover, Mr. Pollack said: “The government can be an unreliable business partner. What happens when the government shuts down? What happens if the health care system is even more dependent on Medicare and the government shuts down again?”

But the coalition does not speak for all health care providers.

The American College of Physicians, the largest medical specialty organization in the country, has supported a Medicare buy-in for people 55 to 64.

And “during the whole debate over the Affordable Care Act, we supported having a public option in the individual insurance market in every state,” said Robert B. Doherty, senior vice president of the college, which represents 154,000 doctors who specialize in internal medicine.

Payers, Providers Push Back on Democrats’ Medicare Buy-In Plan

Calculator that says "Medicare" on it on top of money, next to bottle of pills

Source: FierceHealthcare

Earlier this week, Democrats introduced a bill that would allow people ages 50 and over to buy in to Medicare coverage, and the plan is already getting pushback from payers and providers.

Under the most recent proposal, people between the ages of 50 and 65 could buy a Medicare plan and qualify for subsidies and tax credits under the Affordable Care Act (ACA). The Medicare at 50 Act, led by Sen. Debbie Stabenow, D-Mich., would fund enrollment through premiums and would eventually lower costs for younger people by moving more people into the higher age bracket, its sponsors argue.

However, David Merritt, executive vice president of public affairs and strategic initiatives at America’s Health Insurance Plans (AHIP), called the proposal a “slippery slope to government-run healthcare for every American.”

Merritt told FierceHealthcare that U.S. healthcare is not a one-size-fits-all system and that a vast majority of Americans are satisfied with the coverage they have today, whether it be through Medicare Advantage, Medicaid or private coverage.

“They have choice and control over their coverage, options, and treatment,” Merritt said. “Instead of taking away the coverage that works for them today, let’s focus on protecting and improving what’s working and fixing what’s not. That’s the most effective way to guarantee that every American has affordable coverage and high-quality care.”

The Federation of American Hospitals (FAH) shares similar concerns, saying in a blog post that the bill “would harm more Americans than it would help.” The post said that allowing more people into the Medicare program would weaken the system for those who are already in it.

Instead, the FAH suggests that “Congress should work to sustain and expand affordable private coverage.”

In a recent blog post, the American Hospital Association’s (AHA) president and CEO, Rick Pollack, reiterated his support for strengthening the existing Affordable Care Act and expanding Medicare, but cautioned not to resort to a one-size-fits-all approach.

He argues that this form of government-run coverage poses risks to many U.S. citizens.

“If Congress controls all payments to providers, delivery system reforms to improve care, enhance quality and reduce costs may no longer be a priority as the government would be able to simply ratchet down reimbursement,” Pollack wrote in a blog post earlier this year.

In addition, relying more fully on Medicare and Medicaid would be costly for hospitals, the AHA said. According to the AHA’s fact sheet on the underpayment of Medicare and Medicaid, hospitals received only 87 cents for every dollar spent caring for Medicare and Medicaid patients in 2017.

Despite the concern from the industry, plans to expand Medicare are popular with voters. According to a recent poll from the Kaiser Family Foundation, 77% of the public supports offering Medicare to those 50 and older.

Universal Health Care in California: $17 Billion a Year, Says One Estimate

Source: San Francisco Chronicle

Universal health care in California could cost $17.3 billion a year, under one plan proposed Friday by UC Berkeley health policy researchers.

The paper offers one path for getting about 3 million uninsured Californians health coverage. It is one of several recent estimates from researchers and legislators who have devised various ways to work toward universal coverage in the state. It is not a plan for a single-payer system.

The figure is significantly higher than other analyses, which found that working toward universal coverage by expanding Medi-Cal insurance for the poor would cost less than half of that. That is because the paper builds in the assumption that the uninsured would get on private health insurance plans, whereas other estimates factor in federal funding for getting more people on Medi-Cal, which is jointly paid for by the federal and state governments.

The paper, by Richard Scheffler and Stephen Shortell of Berkeley’s School of Public Health, proposes a mix of new taxes on the health care industry, California employers and airline travelers, paired with contributions from the state’s general fund and premium payments from individuals who are now uninsured.

The ideas, presented Friday to a group of California health policy researchers and advocates, are considered one early stab at financing universal coverage and are not included in legislative proposals.

The largest source of financing, 41 percent, would come from a 3 percent tax on the revenue of hospitals, nursing homes, drug companies, home care providers and insurance companies, which would generate an estimated $7.2 billion a year. The tax would not apply to public hospitals.

The next largest source of funding, 31 percent or $5.2 billion, would come from currently uninsured residents who would pay a monthly premium for a health plan — envisioned as a plan bought through the insurance marketplace Covered California. The premium would be paid by those who earn too much to qualify for Medi-Cal, the insurance program for the poor, and would average out to $123 a month per person. The authors do not specify how many people would pay this premium, or address how to incentivize this population — many of whom are undocumented and hesitant to participate in government programs — to buy into the system.

The paper also proposes a tax on international and business class travelers who fly into and out of California’s five largest airports: Los Angeles International Airport, San Francisco International Airport, San Diego International Airport, Oakland International Airport and San Jose International Airport. The taxes would be $50 per ticket for domestic business class passengers, $60 per ticket for for economy international passengers and $250 per ticket for international business passengers. These five airports see a collective 188 million passengers each year, according to the authors’ analysis of California Department of Transportation air passenger traffic data. The tax would generate $2.3 billion a year.

The remaining funding would come from the state’s general fund in the amount of $1.7 billion, and a tax on employers that would generate $979 million. The employer tax would be modeled after Healthy San Francisco, a program started in 2007 to cover the city’s 14,000 uninsured residents. It would require employers that don’t provide insurance to their workers to pay into a fund by levying a 4 percent surcharge on customers. It would apply to for-profit employers with more than 20 workers and nonprofit employers with more than 50 workers.

Under the plan, the revenue generated through these proposed new taxes would go toward what’s known as integrated care systems to expand their geographic reach and offer more insurance plans on Covered California. The biggest and most well-known integrated system is Kaiser, which provides both the insurance coverage and health care services to its patients, but others have started forming their own integrated care systems in recent years including Sutter Health’s HMO plan, Sharp Health Care in San Diego and HealthCare Partners in Los Angeles. Those integrated care plans would be offered on Covered California.

Scheffler and Shortell say they hope their ideas are a starting point for debate and will inspire action by state legislators.

“We’re hoping for some interest from Sacramento,” Scheffler said.

Some policy experts who reviewed the paper raised questions about some of the proposed taxes and the cost estimate. Ken Jacobs, chair of the UC Berkeley Labor Center, said $17 billion is much too high for achieving universal coverage because it doesn’t take into account the federal dollars that would be available if the state were to expand Medi-Cal to more uninsured people.

A state-level employer mandate could face legal challenges, as Healthy San Francisco did, because of federal preemption issues under the Employee Retirement Income Security Act, or ERISA, Jacobs said. Similarly, the airline tax might run afoul of federal laws regulating interstate commerce and airlines. And the tax on hospitals would need a two-thirds vote in the Legislature and buy-in from health care providers.

“I look at the (financing) as throwing some ideas on the table to start a discussion,” Jacobs said.

Other proposed measures and analyses put different cost estimates for getting California closer to universal coverage. A report released this month by Covered California found that providing more financial assistance to consumers to buy plans would cost between $2.1 billion and $2.7 billion a year.

One bill, AB-4, proposes expanding Medi-Cal to all undocumented adults — a move the Legislative Analyst’s Office has estimated would cost $3 billion annually. Another bill, AB-174, aims to provide financial assistance to those making between $48,000 and $72,000 to buy insurance. It would cost $40 million to $75 million a year, according to estimates included in a previous bill.

Gov. Gavin Newsom’s proposed budget included expanding Medi-Cal coverage to undocumented young adults between ages 19 and 25, and providing state-funded financial assistance to help Californians buy insurance — both of which would be steps toward universal coverage in the state. It is unclear how much the initiatives would cost.

Californians Want Leaders to Expand Access to Mental Health Care, Kaiser Survey Finds

Image result for Californians Want Leaders to Expand Access to Mental Health Care, Kaiser Survey Finds images

Source: Sacramento Bee

Californians indicated In a survey released Thursday that they want state leaders to put a priority on ensuring that people with mental health conditions can get access to treatment, with 49 percent saying it’s extremely important and 39 percent saying it’s very important.

The Kaiser Family Foundation and California Health Care Foundation designed and conducted the poll of 1,404 Californians in November and December, looking to gauge health care priorities and experiences in a state considered a leader in health-care trends. The study’s author noted that, while on the campaign trail, Gov. Gavin Newsom made health care a priority and announced sweeping plans for change in health care.

Survey findings offer a view of what state residents want, the survey authors said, as the new governor takes the reins and a new legislative session begins. Asked to rank what they felt state leaders should make their top priorities, poll respondents put improving public education in the top spot, but following closely behind was making health care more affordable.

While 86 percent of those surveyed considered improving public education very or extremely important, health care affordability ranked highly with 80 percent. Coming in third was making housing more affordable at 75 percent. The findings had an error rate of plus or minus 3 percentage points.

Asked to assess what aspects of health care mattered most to them, survey respondents ranked expanding access to mental health care as most crucial. Next on the list was making sure all Californians have access to health care and third, lowering the cost of health care for Californians.

“About half — 52 percent — of Californians say their community does not have enough mental health providers to serve the needs of local residents, compared to 27 percent who say it does have enough and 21 percent who say they don’t know enough to say,” survey authors said.

Pulling Back Curtain On Hospital Prices Adds New Wrinkle In Cost Control

Image result for Pulling Back Curtain On Hospital Prices Adds New Wrinkle In Cost Control images

Source: Kaiser Health News

As President Donald Trump was fighting with Congress over the shutdown and funding for a border wall, his administration implemented a new rule that could be a game changer for health care.

Starting this month, hospitals must publicly reveal the contents of their master price lists — called “chargemasters” — online. These are the prices that most patients never notice because their insurers negotiate them down or they appear buried as line items on hospital bills. What has long been shrouded in darkness is now being thrown into the light.

For the moment, these lists won’t seem very useful to the average patient — and they have been criticized for that reason. They are often hundreds of pages long, filled with medical codes and abbreviations. Each document is an overwhelming compendium listing a rack rate for every little item a hospital dispenses and every service it performs: a blood test for anemia. The price of lying in the operating suite and recovery room (billed in 15-minute intervals). The scalpel. The drill bit. The bag of IV salt water. The Tylenol pill. No item is too small to be bar coded and charged.

But don’t dismiss the lists as useless. Think of them as raw material to be mined for billing transparency and patient rights. For years, these prices have been a tightly guarded industrial secret. When advocates have tried to wrest them free, hospitals have argued that they are proprietary information. And, hospitals claim, these rates are irrelevant, since — after insurers whittle them down — no one actually pays them.

Of course, the argument is false, and our wallets know it.

First of all, hospitals routinely go after patients without insurance or whose insurer is not in their network. When Wanda Wickizer had a brain hemorrhage in 2013, a Virginia hospital billed her $286,000 after a 20 percent “uninsured” discount on a hospital bill of $357,000 — the list price, according to chargemaster charges. Medicare would have paid less than $100,000 for her treatment.

Second, those list prices form the starting point for negotiations, allowing hospitals and insurers to take credit for beneficence, when there is none.

Not!

If a supposedly $1,000 TV is “on sale” for $80, it’s not really a discount. It’s an absurd list price.

Just as airlines have been shown to exaggerate flight times so they can boast about on-time arrivals, hospitals set prices crazy high so they can tout their generous discounts (while insurers tout their negotiating prowess).

Another rationale for those prices is just plain greed. Dr. Warren Browner, the chief executive of California Pacific Medical Center, describes this as the “Saudi sheikh problem”: “You don’t really want to change your charges if you have a Saudi sheikh come in with a suitcase full of cash who’s going to pay full charges,” he said.

But in an era when American patients are expected to be good consumers and are paying more of their bills in the form of copays and deductibles, they have a right to the information on list prices. They have a right to make sure they are reasonable.

Although making chargemaster pricing public will not, by itself, reform our high-priced medical system, it is an important first step. Maybe, just maybe, a hospital will think twice before charging a $6,000 “operating room fee” for a routine colonoscopy if its competitor down the street is listing its price at $1,000. Making this information public should bring list prices more in line with what is actually paid by an insurer, a far better measure of value.

And while the lists are far from user-friendly, researchers and entrepreneurs can now create apps to make it easier for patients to match procedures to their codes and crunch the numbers. With access to list prices on your phone, you could reject the $300 sling in the emergency room and instead order one for one-tenth of the price on Amazon. You could see in advance the $399 rate your hospital charges for each allergen it applies in a skin test and avoid the $48,000 allergy test — with an $8,000 deductible.

As a next step, regulators should insist that these prices be easily accessible on hospitals’ home pages — perhaps in the place of “PAY YOUR BILL NOW” — and translated into plain English. Seema Verma, the head of the Centers for Medicare & Medicaid Services, has suggested that she may well do so.

Patients can help, too: Check out your hospital’s price list. If it’s not detailed or complete enough, demand more. For discrete items, like an MRI of the brain or a vitamin D blood test, take the trouble to scan the chargemaster for the item. Reject an overpriced procedure (even if your insurer is paying the bulk of the bill) and take your business elsewhere.

Justice Louis Brandeis famously said, “Sunlight is said to be the best of disinfectants; electric light the most efficient policeman.” But, in this case, the reform will work only if people take the trouble to look — and to act — now that the lights are turned on.

Health Care Industry Group Launches Digital Ads Against ‘Medicare for all’

Image result for Health Care Industry Group Launches Digital Ads Against ‘Medicare for all’ images

Source: The Hill

A health care industry group on Thursday launched a digital ad campaign against “Medicare for all,” as health care companies ramp up their efforts to fight the idea gaining ground on the left.

“Whether it’s called Medicare for all, single-payer or a public option, a one-size-fits-all health care system will mean all Americans have less choice and control over their doctors, treatments and coverage,” states the two-and-a-half minute video, which will run as a digital ad on Facebook, Twitter and YouTube.

The group behind the ad is the Partnership for America’s Health Care Future, whose members include major industry players such as America’s Health Insurance Plans and the Pharmaceutical Research and Manufacturers of America, who last year came together to form the group to fight Medicare for all.

The health care industry is expected to fight single-payer efforts vociferously given that the idea threatens to cut payments to players throughout the industry. Opponents also argue single-payer would mean upheaval and less choice for patients.

The video is part of a five-figure ad buy over the next three weeks, as part of a larger six-figure effort that will continue through the year, the group said.

“Medicare for all will mean more politics in health care and will eliminate choice for all Americans,” the ad states.

The group instead calls for a plan to “improve what’s working and fix what’s broken” in the current system.

Supporters of Medicare for all are ramping up their efforts now that Democrats have taken control of the House and have the opportunity to hold hearings on the idea. The plan has no path to passing the Republican-controlled Senate, but 2020 Democratic presidential candidates are also embracing the idea.

Trump Boosts Fight Against Surprise Medical Bills

Image result for Trump Boosts Fight Against Surprise Medical Bills images

Source: The Hill

Momentum is building for action to prevent patients from receiving massive unexpected medical bills, aided by President Trump, who is vowing to take on the issue.

Calls for action against so-called surprise medical bills have been growing, spurred by viral stories like one involving a teacher in Texas last year who received a $108,951 bill from the hospital after his heart attack. Even though the teacher had insurance, the hospital was not in his insurance network.

Lawmakers in both parties say they want to take action to protect people from those situations, marking a health care area outside of the partisan standoff over ObamaCare, where Congress could advance bipartisan legislation to help patients.

Trump gave a boost to efforts on Wednesday.

“[People] go in, they have a procedure and then all of a sudden they can’t afford it, they had no idea it was so bad,” Trump said at a roundtable with patients about the issue.

“We’re going to stop all of it, and it’s very important to me,” he added.

But the effort still faces obstacles from powerful health care industry groups — including hospitals, insurers and doctors. Those groups are jockeying to ensure that they avoid a financial hit from whatever solution lawmakers and the White House back.

Asked if he expected resistance from the health care industry, Sen. Lamar Alexander (R-Tenn.), the chairman of the Senate Health Committee, told reporters Thursday, “I would expect so.”

“Someone has to pay the bill,” Alexander added.

A source familiar with the discussions said insurers and hospitals are “both at the table,” but “they’re just battling with each other on who’s going to take the bigger hit.”

Alexander insisted lawmakers would push forward nonetheless.

“People go to the emergency room and they suddenly are surprised a few weeks later with a bill for $3,000 from an out-of-network doctor,” Alexander said. “We don’t want that happening, so one way or the other I expect to see that addressed in the next several months.”

Trump also received praise from Democrats for highlighting the issue this week.

“I was very glad to see the president start to pay attention to the issue,” Sen. Maggie Hassan (D-N.H.), who has sponsored legislation to protect patients from surprise bills, said in an interview.

She said she is “very optimistic that we will be able to find common ground.”

Lawmakers must first reconcile competing bills. In addition to Hassan’s measure, there is a bill from a bipartisan group led by Sen. Bill Cassidy (R-La.), and a House bill from Rep. Lloyd Doggett (D-Texas), the chairman of the Ways and Means health subcommittee.

“I am encouraged by the increased bipartisan interest, but we still face significant pushback,” Doggett said in a statement, adding that he will keep pushing to end the “predatory practice” of surprise billing.

The Senate group led by Cassidy hopes to get bipartisan support to coalesce around one bill on the issue. They’ve been in touch with Hassan’s office to discuss the best way to address the problem, a GOP aide said. Cassidy’s group hopes to introduce updated legislation soon, the aide said.

In the House, a Democratic aide said there is “momentum” for legislation on surprise bills and a hearing and markup are expected, but there is no timeline yet.

House Democratic staff have been in touch with Cassidy’s office, and there is a briefing on the issue from outside experts for staff for Ways and Means Committee members set to happen in the coming weeks.

All of the possible solutions would protect patients from having to pay exorbitant amounts if their doctor is outside of the insurance network. But the lingering question is who decides how much the insurer should pay to the doctor or hospital for that care.

Those details are what health care groups will be fighting over.

Molly Smith, a vice president at the American Hospital Association, said “patients need to be held harmless” and “we definitely want to be at the table” to discuss the solution.

“We are all on the same page of what the problem is,” said Kristine Grow, a spokeswoman for America’s Health Insurance Plans. Grow said the debate comes down to details over how health care providers will be paid and ensuring that insurance companies are able to maintain control over their networks.

Alexander said Congress will act even if health care groups cannot agree.

“The first place to deal with it is for the hospitals and doctors and insurance companies to get together and end the practice,” Alexander said.

“And if they don’t, Congress will do it for them.”

Covered California Enrollee Fights Blue Shield Plan to Limit Out-of-State Care

Image result for Covered California Enrollee Fights Blue Shield Plan to Limit Out-of-State Care images

Source: Insurancenewsnet.com

Jan. 02–Blue Shield of California is unfairly targeting hundreds of thousands of Covered California enrollees with a coverage change that would prevent them from getting routine care when they are working outside of California, one enrollee told The Sacramento Bee.

Philip Martin has been trying to get Blue Shield to reverse its decision to limit out-of-state medical coverage for PPO members whose policies didn’t go into effect before Jan. 1, 2014, the date when coverage under the Affordable Care Act went into effect. Blue Shield is limiting out-of-state coverage to urgent care, emergency care or follow-up related to those events.

“They are specifically discriminating against this demographic for more profit,” Martin said, “not even allowing people who have been with them since the beginning to be grandfathered in.”

Roughly 360,000 Covered California enrollees were covered through the Blue Shield PPO by mid-2018, according agency spokesman James Scullary, and about 6,000 of those enrollees had sought out-of-state medical care.

Given that the Blue Shield provisions are changing, Scullary urged Martin and other Covered California enrollees who need a plan offering routine care outside of California to study all the insurer networks because some plans have physicians in other states. Open enrollment continues in Californiathrough Jan. 15.

Martin, a 32-year-old Laguna Nigel resident, said he works regularly in California, New York and Florida, and his sister goes to college out of state. They both have routine care needs that can’t always wait until they are in California, he said.

“I have relationships with primary care physicians in New York and Los Angeles,” Martin said. “I’ve had specialists that I’ve been working on knee issues that I’ve had. I have an orthopedic surgeon and an acupuncturist who have helped with some of those injuries. Also, I have a therapist in New York, one in Florida and one in L.A. that I work with when I’m back there. And, then also, I have chiropractor needs because my work is very demanding with clients. I work out a lot with them. They want to work out with me. We do a lot of physical activity.”

Martin said that he called Blue Shield customer service to discuss his care needs, and the representative suggested he come back to California for appointments with medical professionals. He does not make enough money with his work to make such trips cost-effective.

“I work as a recovery coach. I work with people who have addiction issues and mental illness issues, usually diagnosed as bipolar or alcohol addiction or meth and depression,” he said. “For me, sometimes I can get a case in another state for two months. Basically, I am with that client 24/7, or I’m with that client 12 hours out of the day to help them with their 12-step program or help them start a job.”

The coverage change is also alarming for Martin’s sister, who is a student at New York University but covered under their mother’s Blue Shield PPO plan, he said.

Martin said he enrolled in Covered California prior to the Jan. 1 date, but coverage didn’t start until that date. He appealed the coverage change with Blue Shield and shared the response letter with The Bee. It read: “This change is being made to help us fulfill our goal of keeping coverage costs down for all PPO members.”

In a statement emailed to The Bee, Blue Shield said that its PPO would cover only non-emergency care that receives prior authorization and suggested members contact Blue Shield customer service with questions.

Martin shared a letter from Blue Shield that lists non-emergency services that it will cover without prior authorization. They are CAT and MRI scans, and mental health outpatient services.

Martin said he also filed a complaint with the California Department of Managed Health Care, but a department spokesperson told The Bee that state legislation does not require plans to provide non-emergency or non-urgent services outside the state of California, so the DMHC does not have any jurisdiction in the matter.

Last Updated 04/24/2019

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