Here’s what happened over the MLK weekend…

Kudos to Sen. Amy Klobuchar (D Minn) for her efforts to reduce Medicare drug prices.  She introduced a bill that would allow CMS to negotiate drug prices, a seeming no-brainer.  Reasons to support the bill:

• reduces Medicare recipients’ drug costs
• reduces taxpayers costs
• reduces the Federal deficit

Reasons to oppose the bill:

• Big pharma, which donates gazillions to politicians, hates it.

Speaking of which, two states are suing Bug Pharma for damages associated with opioid abuse.  A lawsuit against Purdue, manufacturer of OxyContin, is proceeding in Kentucky – a state that has been devastated by opioid abuse.  The big drug maker missed a crucial deadline to file papers in the case, putting them in a even tenuous position.

Their neighbor to the north is suing a dozen pharma distributors and manufacturers, claiming the firms failed to implement adequate anti-diversion controls.  The suit was filed by the former Attorney General. This one is…complicated, as the current West Virginia Attorney General used to be a lobbyist for a big drug distributor that may be added to the suit. And, his wife is currently a lobbyist for one of the companies that is named in the suit.

Meanwhile, the explosive growth in heroin usage continues, driven in large part by folks who got addicted to prescription drugs and now seek their highs from heroin.  Which is even more deadly than Oxy; the CDC reports deaths were up 39% in 2013.

WCRI Annual Meeting

is coming up!  Scheduled for March 5-6 in Boston, the agenda includes details on WCRI’s new research on the costs and consequences of physician dispensing of drugs; the impact of the Affordable Care Act on workers’ comp, and a deep dive into the effect of low fee schedules on medical prices.  Among other luminaries, CWCI President Alex Swedlow will be there talking about the impact of doc dispensing on return to work.

The estimable Ramona Tanabe will review the “State of the States”, a must-see for payers focused on specific jurisdictions.

If you haven’t signed up yet, do it here now before it fills up – which is always does.

 Implementing Health Reform

First, the big news is…there isn’t any news about the Federal Exchange site crashing.  You can almost hear the sighs of relief coming from the White House and CMS.

A couple of items reform-related:

The percentage of people who had problems paying a medical bill declined from 41% in 2012 to 35% last year.

Even better, fewer people are avoiding medical care due to the cost; the percentage dropped from 43% to 36%.

Hiring!

Ascential Care is looking for case management staff in several jurisdictions. Contact info http://ascentialcare.com/connect/.

Instead I’ll be finishing ‘The Half has Never Been Told’, the most disturbing book I’ve ever read.

Like many, or perhaps most, I’ve not taken Martin Luther King Day seriously in the past.  When I had it off, I used it as a catch-up day.  When I didn’t (the last 18 years) I almost always worked.

My decision is not so much about Dr. King as it is about values.  What he stood for, what he died for, what he worked for is in peril.  The events of the last few months coupled with the lack of economic progress over decades for many people of color have been a wake-up call.  We are better, far better than this.

A quote from Ohio Gov. John Kasich’s inauguration speech makes the point very well:

It’s all about me. And somehow we have lost the beautiful sound of our neighbor’s voices. Moving beyond ourselves and trying to share in the experience of others helps us open our minds, allows us to grow as people. It helps us become less self-righteous. Did you ever find that in yourself? I do…self-righteous. Allows you to be more righteous. Empathy is the first ingredient in compassion and makes it possible for us to care enough to begin to reach out to those who have been forgotten, disenfranchised, ignored, or who are suffering, and to reach out to them in the way they need.

A while back I received an email from a very successful businessman that quoted from Pat Buchanan’s unbelievably racist, stupid, ill-informed and hurtful column about racism.  To wit:

America has been the best country on earth for black folks. It was here that 600,000 black people, brought from Africa in slave ships, grew into a community of 40 million, were introduced to Christian salvation, and reached the greatest levels of freedom and prosperity blacks have ever known.

Buchanan goes on to blame blacks for pretty much everything negative affecting the black community.  I responded immediately to his email, then promptly forgot about it.

Then, I found ‘The Half’.

The book links slavery and economics tightly together, so much so that on occasion I’ve found myself forgetting that author Edward Baptist is writing about slavery – the ownership of one human being by another. Baptist seems to have recognized that risk, as he intersperses graphic and wholly terrifying descriptions of rape and child rape, family-splitting, flogging, murder and whipping throughout. He doesn’t do this gratuitously, but rather to make two points;

• slavery is the most evil one human can do to another; and
• without the mundane brutality employed by slave owners  the geographic expansion and economic development of the United States would have been much, much different.

For a very smart, very successful American businessman to say anything positive about slavery is just appalling.  That statement endorses absolutely horrific behavior, while perpetuating the false meme that the poor and underprivileged are solely responsible for their condition.

What utter bullshit.

If you don’t believe it, read ‘The Half’.

That’s not to say our various, sundry, and very expensive public policy efforts to alleviate poverty and racism have been universally successful – far from it.  But just because we continually screw up doesn’t mean we shouldn’t keep trying.

How a nation treats its poorest, most vulnerable, least able and least fortunate defines that nation.  And we have failed those people, and failed them miserably.

Today’s the day to think about what we can do to help.  Tomorrow – and the days after – are the days to do it.

Monday, Aetna announced it will be increasing the company’s minimum wage to $16/hour.  In the internal memorandum provided to managers, the company said “We will not be funding this program through job eliminations…

According to a source, during a company-wide webcast earlier this week, CEO Mark Bertolini said “We do NOT anticipate any lay offs. There is plenty of room for employment within the company.  That would of happened in December if we were going to do anything like that.  We are past that.”  

Wednesday, 11 employees in Coventry Workers’ Comp Services Franklin, TN office were fired.  Sources indicate layoffs have happened in several other CWCS locations as well.

While it may well be that the giant healthplan’s financial plan doesn’t directly link the firings to funding the higher wages, the timing and the details provided to this reporter show a rather unfortunate lack of planning and coordination.

Telling low-wage workers they’re getting a big raise, then, after they’ve gone home, told their spouses and kids, perhaps planned on a celebratory dinner with chuck roast instead of the usual hamburger, bought that winter coat they’d been unable to afford, and maybe even paid a couple bills, they get the “just kidding! you’re fired!” notice is, if not intentionally cruel, certainly unintentionally so.

And pretty dumb.  The company got lots of (well-deserved) positive press and supportive comments from around the country for the wage and benefits upgrade.  Then, they turn around and fire some of those same low-wage workers they’re saying they want to help.

What’s more troubling is why.

Sources indicate the jobs lost are in Coventry Work Comp Services unit, primarily handling administrative tasks including preparing network panel postings for the Hartford’s workers’ comp customers, scheduling claimant appointments, and Quality Assurance.  But they aren’t going away, rather Aetna is off-shoring them to the Philippines.  Several management staff remain on payroll for now, but their positions are also going to be eliminated after they train their Filipino replacements.

By most accounts Aetna CEO Mark Bertolini is a good guy.  He’s aware of and quite concerned about income inequality.  He asked his execs to read Thomas Piketty’s treatise on the subject.  Aetna is also significantly improving benefits for the company’s lower-wage workers. In a statement, Bertolini said:

“Since I became CEO, one of my goals has been to help re-establish the credibility of corporate America…I firmly believe that companies can ‘do well by doing good.’ With these investments, we are leaning into the recovering economy and working to bring everyone along instead of just a few.”

My read on this is Aetna is not a bad company and its execs are not bad people. There’s no intentional cruelty here, this isn’t a heartless oligarch playing God without any regard for the little gal.

While Bertolini is a good guy, some of his underlings are not.  This is a dumb decision made by a tiny division executed by crappy managers with no regard for how it affects folks making low wages doing important work for years.

My characterization of the managers is based on the timing and their petty. small-minded, and just plain stupid cost-cutting moves which included no Christmas bonuses, no holiday celebration of any kind (not even the traditional dinner), paying laid-off workers only 50% for their unused vacation time, and a paltry 4 weeks of severance for workers with more than 2 years at CWCS.

One wonders if those managers at least handed out “Merry Christmas, now get the hell out of here” cards.

What does this mean for you?

A pretty awful winter for folks who thought they were going to get a nice raise.

note- I reached out to Aetna several times, delayed this post in an effort to get their side of the story. After waiting all day, i informed them I had to go to press.

If I hear from Aetna I will let you know…

Vince Kuraitis’ Health Wonk Review is just what you need to cure what ails ya!

A great snapshot of the best of the blogosphere is up and ready for your reading pleasure!

Don’t miss Julie Ferguson’s piece on the dangers of the nursing night shift – namely a significantly higher risk of premature death…

Once again I’ll head out on a limb with saw firmly in hand…

1.  Aetna will NOT be able to sell the Coventry work comp services division.  I’ll double down on last year’s prediction: even if the giant health plan wants to dump work comp, the network – which is where all the profit is – isn’t sellable.  The rest of the operation isn’t worth much; the bill review business continues to deteriorate (and CWCS is looking for a replacement BR application) , competitors are picking off key staff, and customers continue to switch out services and network states.

2.  Work comp premiums will grow nicely, driven by continued improvement in employment and gradually increasing wages coupled with increases in premium rates in key states (we’re talking about you, California).

3.  Additional research will be published showing just how costly, ill-advised, and expensive physician dispensing of drugs to workers’ comp patients is. Following on the excellent work done by CWCI and Accident Fund/Johns Hopkins, we can expect to learn more about the damage done to patients, employers, insurers, and taxpayers by docs looking to Hoover dollars out of employers’ pocketbooks.

4.  Expect more mergers and acquisitions; there will be several $250 million+ transactions in the work comp services space, with more deals won by private equity firms.  Of late, most transactions have been “strategics” where one company buys another; the financials of these have been such that private equity firms couldn’t match the prices paid.

I’d expect that will change somewhat in 2015 as  “platform” companies come on the market.

5.  A bill renewing TRIA will be passed; the new GOP majorities want to show they can “govern” and this has bipartisan support.

6.  Liberty Mutual will continue to de-emphasize workers’ comp. The company’s continued focus on personal lines and property and liability coverage stands in stark contrast to the changes in work comp.  The sale of Summit, management shifts, and the financial structuring of legacy work comp claims portend more change to come. Recent financial results show the wisdom of this strategy…

7.  After a pretty busy 2014, regulators will be even more active on the medical management front.  Work comp regulators in several more states will adopt drug formularies and/or allow payers/PBMs to more tightly restrict the use of Scheduled drugs via evidence-based medical guidelines and utilization review.  While the former is easy, the latter is better, as it enables payers and PBMs to more precisely focus their clinical management on the individual patient.

Expect more restrictions on physician dispensing and compounding, increased adoption of medical guidelines and UR, along with incremental changes in several key states (California we hope) to “fix” past reform efforts.

8. There will be at least two new work comp medical management companies with significant mindshare by the end of 2015. These firms, pretty much unknown today, are going to be broadly known amongst decision-makers within the year.  While they will not generate much revenue this year, they will be attracting a lot of attention.

9. Outcomes-based networks will continue to produce much heat and little real activity.  After predicting for years that small, expert-physician networks will gain significant share, I’m throwing in the virtual towel. There’s just too much money being made by managed care firms, insurers, and TPAs on today’s percentage-of-savings, huge generalist network/bill review business model.  Yes, there will be press releases and articles and speeches; No, there won’t be more than a very few real implementations.

10.  Medical marijuana will be a non-event.  Amidst all the discussion of medical marijuana among workers’ comp professionals, there’s very few (as in no) documented instances of prescribing/dispensing of marijuana for comp claimants. Yes, there will likely be a few breathless reports about specific claims, but just a few.  And yes, there may also be a few instances of individuals under the influence of medical marijuana incurring work comp claims, but these will be few indeed.

There you have it – here’s hoping I’m more prescient this year than I was last.