Apr
19

Hilarious health reform mis-information

Ok. I’m not exactly what one would call a ‘fan’ of the health reform bill – too much coverage, not near enough cost control. There are plenty of issues with the current bill, more than enough to make serious students/wonks concerned without having to resort to outright lies.
Yet that is precisely what some are doing. Here, collected for your reading pleasure by the good folks at FactCheck.com, are the top nine falsehoods perpetrated by those not smart enough to focus on the real issues.
* Requires patients to be implanted with microchips. (No, it doesn’t.)
* Cuts benefits for military families and retirees. (No. The TRICARE program isn’t affected.)
* Exempts Muslims from the requirement to obtain coverage. (Not specifically. It does have a religious exemption, but that is intended for Old Order Amish.)
* Allows insurance companies to continue denying coverage to children with preexisting conditions. (Insurance companies have agreed not to exploit a loophole that might have allowed this.)
* Will require 16,500 armed IRS agents to enforce. (No. Criminal penalties are waived.)
* Gives President Obama a Nazi-like “private army.” (No. It provides a reserve corps of doctors and other health workers for emergencies.)
* “Exempts” House and Senate members. (No. Their coverage may not be as good as before, in fact.)
* Covers erectile-dysfunction drugs for sex offenders. (Just as it was before the new law, those no longer in jail can buy any insurance plan they choose.)
* Provides federal funding for abortions. (Not directly. But neither side in the abortion debate is happy with the law.)
Here’s the detail on a couple of the more ludicrous issues (quoting FactCheck.
Does the law provide for armed IRS agents to enforce penalties?
No. This is a fantasy. GOP lawmakers claim the law might require “as many as 16,500” new jobs in the IRS, a figure inflated by dubious assumptions. But the agency’s role will be mainly to hand out tax credits, not to enforce penalties. And the IRS won’t be sending armed agents to enforce the health care mandate, as falsely claimed by Texas GOP Rep. Ron Paul. The law specifically waives any criminal penalties for those who both decline to obtain insurance coverage and refuse to pay the tax enacted to penalize lack of coverage.

And here’s this whopper, which was ‘reported by a number of wingnut sites, including ‘last days’ crazies. and from this firearms advocacy site.
Will the law require all patients to be implanted with microchips?
No. Nothing like this appears in the new law, or in any of the bills that Congress considered. This claim stems from a wild misinterpretation of a provision in the original House leadership’s bill (H.R. 3200) that did not require implantation of anything, and that was, in any case, not part of the final legislation. The part of the original House leadership’s bill that’s usually referenced to support this rather paranoid claim actually would have set up a registry for class III medical devices and class II devices that are “implantable, life-supporting, or life-sustaining.”
jeez, would someone buy these people a clue…


Apr
16

Hospital costs in California – the tide has turned

Health Affairs’ most recent edition includes a piece [sub req] on the changing health care landscape in California, one that now has hospitals occupying the high ground. The historical background is telling;
too many hospitals to begin led to tough bargaining by insurers,
which dramatically reduced hospital revenues and profits,
followed by consolidation, hospital closings, and reduction in capacity,
leading to a shift in market power as insurers, needing coverage in key areas,
were forced to agree to ever-higher rates,
pushing hospital costs, revenues, and profits back up.
Here are a couple excerpts from the article.
“In current health reform discussions and proposed legislation, providers’ growing market power to negotiate higher payment rates from private insurers [emphasis added] is the “elephant in the room” that is rarely mentioned. Here, in our study of the current negotiating environment in California, we explain that growing market power for providers caused a shift that gave providers a stronger bargaining position [emphasis added] over health plans, leading in turn to higher insurance premiums…
A recent study has shown that in California, after a downward trend in hospital prices for private-pay patients in the 1990s, a rapid upward trend began about 1999 that produced average annual increases of 10.6 percent over the period 1999-2005 [emphasis added]. The study’s authors concluded that the source of the near-doubling of California hospital prices remains “something of a mystery.”5
Analysis of Medicare Cost Report data by the Medicare Payment Advisory Commission (MedPAC), although national, shows that inpatient costs per admission increased only 5.5 percent per year during that period.”
The net is this – hospitals’ market power enabled them to raise prices by 10.6% while their costs only went up about half that fast.
This is meaningful on many levels.
1. If you operate in California, your facility costs are trending higher quickly.
2. Reimbursement is but one part of the contracting process; hospitals will, and are, using their leverage to squeeze other concessions out of payers, including faster bill payment, reductions in the UR burden, and speedy resolution of disputes.
3. California is leading a trend that will be felt in many other states, and soon.
4. Those payers with the ‘loosest’ contracts, particularly those based on a percentage off charges, are going to get hammered. And those with contracts that are only slightly better are no better off.
I’d add that the article also addresses the growing power of larger physician groups, whose negotiating leverage is evolving along similar lines. More on that in a future post.
What does this mean for you?
Big health plans are at the mercy of hospitals, so costs are going to go up. For workers comp payers, the picture is even worse. Your best bet is to keep injured workers out of hospitals.
Then again, you can always just raise rates…


Apr
15

How the Republicans will defeat health reform

Desperate times call for desperate measures, and today’s GOP is certainly close to desperation. A recent news article highlights their new strategy; building bridges to allies in the fight to overturn, repeal and replace ObamaCare.
You’ve got to admire the Republicans’ big tent…


Apr
12

Obama’s deal – the making of health reform

On Tuesday night, PBS’ Frontline focuses on what really happened to get health reform passed. Here’s a blurb from the press trailer:
“The administration’s hopes for reform rested with Sen. Max Baucus (D-Mont.), the powerful head of the Senate Finance Committee, who also happened to be one of the Senate’s top recipients of special interest money from the health care industry.
The White House encouraged Baucus to quietly negotiate deals with the insurance lobby, drug companies and other special interest groups, despite promises to run a different kind of White House. “The president said that having people at the table is better than having them throw stuff at the table,” White House Communications Director Dan Pfeiffer tells FRONTLINE. ”
While I haven’t seen the actual program, the trailer is pretty tough stuff.


Apr
8

Two points – EHR and the government’s incompetence

Bill Sota posted a brief piece about the Veterans Administration’s adoption and use of Electronic Health Records, citing: “Good news on the cost savings performance of Vista which is the VA’s electronic medical record system:”
Bill is referring to the primary source, an article in Health Affairs:
“The VA spent proportionately more on IT than the private health care sector spent, but it achieved higher levels of IT adoption and quality of care. The potential value of the VA’s health IT investments is estimated at $3.09 billion in cumulative benefits net of investment costs.” [emphasis added]
Two points.
1. The VA is a very, very large health system that has implemented an EHR program and saved taxpayers over $3 billion dollars – so far. Implementing EHR is difficult, time-consuming, and a lot of work. Yet it can, and has, been done.
2. This is a creditable result, and one that should encourage other integrated health systems to find out what the VA has done and, perhaps, do something similar. After all, if the gubmint can do it, it should be child’s play for the vaunted free market…
Unfortunately, it appears as if the private sector isn’t as competent in this area as the VA. Within the article itself are a couple telling conclusions. First, the VA spends considerably more (as a percentage of total expenditures) on IT than the private sector does. Yet the VA’s ratio of IT capital spending to total spending is considerably less than the private sector’s.
The VA spends more on IT, with a big chunk of that invested in implementation and maintenance. And the results show the impact:
“The VA has achieved close to 100 percent adoption of several VistA components since 2004. In contrast, the private health care sector has not reached significant adoption of any of these systems. Adoption in the private health sector of inpatient electronic health records stands at 61 percent; use of inpatient bar-code medication administration is at 22 percent; computerized physician order entry adoption stands at 16 percent; and outpatient electronic medical record adoption is at 12 percent”
Finally, the implementation of the VA’s VistA system has delivered significant improvements in the quality of care delivered. Here are just a couple examples (quoted from the articleº:
– For preventive care process measures such as cancer screenings, the VA had higher performance during 2004-2007 relative to the private health care sector
– VA patients with diabetes had better glucose testing compliance and control, more controlled cholesterol, and more timely retinal exams when compared to the Medicare health maintenance organization (HMO) private-sector benchmark.
– The VA averaged about fifteen percentage points higher than the private sector on preventive care for patients with diabetes and seventeen percentage points higher for patients with diabetes who have well-controlled cholesterol
What does this mean for you?
EHR can, and has, delivered significant savings and RoI while increasing quality.
The next time someone bemoans the government’s incompetence and complete lack of ability to run anything, tell them about the VA. And tell them to stop parroting Fox talking points; they are a poor substitute for actual thinking.


Apr
7

The terrible burden of SOHDS

The tradition here at MCM is to honor all the important holidays, with none so important as April 1. In the five and a half years I’ve been publishing this blog, the April 1 post has become a challenge – how can we top the previous year?
Last year’s post about Coventry acquiring UnitedHealthGroup was reportedly the cause of some consternation at the afore-mentioned firm, which was forced to issue a press release denying the deal (I’m kidding).
This year’s effort generated much good cheer among many readers, as even a few who take issue with some of my opinions got a good laugh (Allen you weren’t alone).
Unfortunately, there’s always someone who doesn’t think before passing on the post as truth, resulting in a bit of embarrassment. The adults are a bit chagrined, and a bit wiser, and take the heat in good spirit, realizing the spoof is all in good fun.
But there’s always someone without a sense of humor. Late on the fateful day, a senior policy person at a conservative-group-that-shall-remain-nameless sent me an email which read in part “Is this really true? If so, it is extremely explosive and could quickly become a national story. Can you cite the specific language in the law just signed by Obama and the relevant NHS language that leads you to your conclusion? Thank you.”
I responded back that no, it wasn’t true.
Evidently my correspondent is afflicted with a serious case of SOHDS (sense of humor deficit syndrome), as he (yep, it was a male) shot back “That is extremely unfortunate and not at all funny. I had run it past several very senior people who were looking forward to confirmation of its veracity.”
I’ll bet.
(In retrospect, maybe I should’ve come up with some wild story about how this was in a Presidential signing statement that had not yet been made public, and quoted actual verbiage…)


Mar
31

Why all the sound and fury about the individual mandate?

The objections to the individual mandate are loud, frequent, and hyperbolic. What they are not is credible.
Much of the criticism of the mandate appears to be coming from people and organizations that previously supported a mandate. That’s why it is so difficult to take them seriously.
Here are a couple examples.
Mitt Romney, who could teach a kite a thing or two about moving with the political winds, signed a bill into law saying it was “a personal responsibility principle”; a bill that was pretty similar to the one he now describes as “an unconscionable abuse of power.”. (and yes, Romney did endorse a Federal mandate)
Romney also said “Some of my libertarian friends balk at what looks like an individual mandate. But remember, someone has to pay for the health care that must, by law, be provided: Either the individual pays or the taxpayers pay. A free ride on government is not libertarian.”
– Sen Orrin Hatch (R UT) cosponsored a bill that required a universal mandate back in 1993. Today, he says:””If they mandate you have to buy insurance, it’ll be the first time in this country that the government can tell you what to buy,” said Hatch, warning the measure could portend even more government control in the future.”
– Newt Gingrich, who backed a mandate back in 2008, and…doesn‘t now.
Many of the loudest objectors were strong supporters of the mandate in the past, including the worthies at the Heritage Foundation. Here’s what they said then (text spacing issues from original):
The second central element-in the Heritage proposal is a two-way commit ment between government and citizen. Under this social contract, the fed eral government would agree to make it financially possible, through refund able tax benefits or in some cases by providing access to public-sector health programs, for every American family to purchase at least a basic package of medic a l care, including catastrophic insurance. In return, government would require, by law every head of household to acquire at least a basic health plan for his or her family.Thus there would be mandated coverage under the Heritage proposal [emphasis added], but the mandate w ould apply to the family head, who is the appropriate person to shoulder the primary responsibility for the familys health needs, rather than employers, who are not.
And here’s what they say now:
This “personal responsibility” provision of the legislation, more accurately known as the “individual mandate” because it commands all individuals to enter into a contractual relationship with a private insurance company, takes congressional power and control to a striking new level. Its defenders have struggled to justify the mandate by analogizing it to existing federal laws and court decisions, but their efforts do not withstand serious scrutiny. An individual mandate to enter into a contract with or buy a particular product from a private party, with tax penalties to enforce it, is unprecedented– not just in scope but in kind–and unconstitutional as a matter of first principles [emphasis added] and under any reasonable reading of judicial precedents.
Which leads to the question – why have Romney, Gingrich, Hatch, and Heritage (amongn others) changed their view? Could it be due to a re-reading of the Constitution? New evidence that the original authors didn’t want universal health care?
Or could it be that no one to the right of center wants to say anything neutral, much less positive, about anything the President and his fellow Democrats advocate?
Why is this? The reform plan, which has more than its share of warts, doesn’t include a public option, has a relatively weak mandate mechanism, relies on private insurers to provide coverage, and doesn’t do anything to manage price or utilization.
One would think all conservatives wouldn’t find that so universally objectionable.
This doesn’t make sense at any level; their flipflopping is patently obvious and readily identified, and all the Dems have to do is advance increasingly centrist ideas and watch while the GOP partisans howl in outrage, backing themselves into a really small corner.
If they don’t wise up, they’ll find themselves a very, very small party.
There’s a lot left to do to truly ‘reform’ health care. Without the contributions of legislators from all parts of the political spectrum we will end up with a system designed by one party. Some will never ‘buy in’ to that system, no matter how moderate and effective the reforms may be.


Mar
29

Flip flopping on the mandate – Gingrich’s hypocrisy

There are enough problems with reform – big, obvious, scary problems – that make lying about reform unnecessary. Yet opponents continue to resort to ludicrous, unsupportable, and completely false claims about the bill, with some of the leading detractors choosing to rewrite history in an effort to scare voters and score political points.
It is NOT socialized medicine, socialized healthcare, government-controlled health care, a violation of the US Constitution, or any of the other ridiculous charges leveled by people who should be more responsible. The reform law is:
– pretty centrist – no public option, utilizing private, for-profit insurers to deliver insurance
– without price controls on providers or insurers, and with no utilization controls to speak of
– based on a very weak mandate that is more accurately described as a fine for those who decide to forgo coverage
Among the demagogues who know better is Newt Gingrich the former House Speaker is outraged, outraged I say, at the Democrats’ passage of the insurance mandate. He’s obviously had a change of heart, as a few short years ago he not only called for an enforceable mandate in a speech, he did it in two of the books he wrote.
Newt’s flip-floppery came about just yesterday, when the following dialogue took place on that fair and balanced network:
HANNITY: Do you think any of these constitutional challenges that are out there about the employer mandate, individual mandate, or any of the other challenges — do you think as they work their way through the courts, that any of that will be effective?
[…]
GINGRICH: Then you have to appeal the president’s ruling and they’d probably lose that fight. But what my sense is — first of all, I’m glad to see that some 13 attorneys general around the country —
HANNITY: Are going to sue.
GINGRICH: Have sued. Based on a 1992 Supreme Court decision which said that the federal government cannot punish you for failure to do something, I think that there’s an outside chance the suit will hold up. And that that will stop the individual mandate at the federal level.
Hmmm, seems pretty unequivocal.
here’s what Newt said just two years ago: “According to a June 11, 2008 Associated Press article (accessed from the Nexis database), which ran under the headline, “Gingrich suggests insurance mandate for those who can afford,” Gingrich reportedly “outlined his strategy to combat rising health care costs a plan of attack that includes insurance mandates for people who earn more than $75,000 a year” at a visit to a Nebraska health system. The article went on to report that “Gingrich called it ‘fundamentally immoral’ for a person who can afford insurance to save money by going without, then show up at an emergency room and demand free care. He said those who can afford insurance and choose not to buy it should be required to post bonds to pay for care they may someday need… Gingrich said everyone should have insurance, but not provided by the federal government.” [emphasis added]
(from MediaMatters)
Is he so ignorant, or so ballsy, that he doesn’t think anyone will pay attention to what he said, or wrote, a few short months ago? Or is Gingrich so driven, so insanely desperate for power, that he’ll be blown by political winds like a feather in a gale? Gingrich’s patently false statements are prima facie evidence of the depths to which right-wing opponents will descend in pursuit of power and popularity.
It’s disgusting and abhorrent behavior, and ill serves the nation.
What does this mean for you?
The new law of the land is nowhere close to perfect, or even very good; as I’ve said repeatedly I’m deeply concerned about the law’s all-but-complete failure to address costs. There’s so much misinformation circulating about health reform it is impossible to keep track of it all, much less debunk it.
When you hear Romney, or Boehner, or McConnell, or their fellow wingnuts proclaim the end of America as we know it, ignore them, or better, marvel at the lengths they will go in pursuit of the votes of the ignorant.


Mar
22

Health reform’s implications for workers comp

While it’s not a done deal, the passage of health reform legislation is all but inevitable. When President Obama signs the bill on Tuesday, the American health care system will begin a change more drastic and comprehensive than anything we’ve seen in decades.
Not all of this will be for the better, and when those unintended consequences begin to be felt there will be plenty of recriminations. I’ll give my take on what those might be later.
For now, here’s the quick summary of how reform will likely impact work comp.
1. Less need for hospitals to cost shift to work comp to make up for revenues lost due to treating the uninsured. Sure, Medicaid reimbursemt is lousy and Medicare not much better but something’s a lot better than nothing.
2. Possibly more cost shifting from other providers to work comp to make up for big cuts in Medicare reimbursement. More to come on this late this summer when Congress takes on the SGR debate.
3. Possibly higher claims frequency, although this is based on assumptions and interpretations. The data indicate those workers with health insurance are more likely to file comp claims than those without, but that appears to be a statistical relationship and not neccesarily a causal one. More explanation on the way.
4. For the big managed care companies, a much stronger and tighter focus on managing group health, Medicaid and Medicare will mean less interest in, and resources dedicated to comp. Make no mistake, this is an event for which the big and small health plans are woefully unprepared. If they are to survive they must adapt immediately.
All we have time for today; these big events really should wait till I’m back from holiday.


Mar
19

What’s missing from the CBO reform cost estimate

Yesterday’s news that the CBO estimated the reform bill will come in under the Democrats’ $950 billion over ten years (after revenue increases) was good news for reform advocates.
But the analysis didn’t account for the $250 billion plus deficit that’s hanging over Medicare like Damocles’ sword. As I’ve reported previously, Medicare physician reimbursement will change – and when it does that deficit will be added to the nation’s debt.
That’s not to say the CBO erred in their cost projection. They are required to base their calculations on current law, and current law has physician fees slashed by over 20% this fall.
That is NOT going to happen. And therefore the real cost of the Medicare program is going to be at least a quarter billion dollars higher than CBO projects.