The LePage administration’s letter to the federal government seeking ways to bring new Medicaid funding to Maine is encouraging. It has stimulated new discussions about the Affordable Care Act, the role Medicaid plays in Maine and how federal funds support the program.
In the current debate, we hear that Maine has seen a reduction in federal reimbursement. Medicaid, called MaineCare here, is a shared responsibility. Today the federal government provides about $62 for every $38 the state spends on Medicaid services. Each year a formula, based on per capita income, is calculated to determine how much federal money a state will receive.
Maine is treated just like all the other states and, like about half of them, has seen its federal funding decrease. Conversely, some years our federal rate increases. The formula is cyclical, reflecting income changes in the states. The funding formula should be updated, but only Congress can do that.
Congress enacted a one-time, temporary Medicaid increase to help states through the recession. Maine and all states benefited from that temporary payment bump that began October 2008, knowing it expired in June 2011.
The Affordable Care Act now provides states with 100 percent federal funding for three years and 90 percent thereafter if they cover low-income adults who were previously ineligible for Medicaid. Some argue that the act penalizes states such as Maine: Because adults were already covered here, Maine cannot qualify for this new federal funding.
But in 2009, during the Affordable Care Act debate, states that were “early expanders” of Medicaid raised similar concerns. Working together, and with congressional and White House staff, we secured a special provision in the law. Maine will receive more federal funding (81 percent versus the current 62 percent) to cover childless adults in 2014. That amount increases each year until it reaches 90 percent, just like other states receive in 2020 and beyond.
The federal government will pay fully for those on the waiting list for services. There is another pathway in the law that may even qualify us to receive full funding for adults already on the program.
As early expanders, we knew we’d see savings through the Affordable Care Act. Some of those now served by Medicaid could instead became eligible for private insurance premium tax credits offered through the new insurance exchanges and paid for by the federal government, not the state. The savings to states such as Maine have been cited by liberal and conservative sources alike.
In some states, parents will also be funded at 100 percent for three years when the Affordable Care Act is fully in place in 2014. But all states already covered some parents (the median is 66 percent of the federal poverty level), and 18 states, including Maine, had already covered parents above 100 percent of the poverty level. By law, no state will receive higher funding for those already covered. Much of that expansion in Maine, however, was paid by the initiative Dirigo Health, not state general funds.
We who lead in the American health care system — primarily physicians and hospitals — are slowly having our credibility with the public eroded. The main reason for this is our collective failure to credibly lead this country in its journey to a health care system that safely and affordably cares for all Americans.
The latest such blow to our credibility is “Bitter Pill: Why Medical Bills Are Killing Us,” published four weeks ago as the cover story in Time magazine http://healthland.time.com/2013/02/20/bitter-pill-why-medical-bills-are-killing-us/. In a 26,000-word article, Steven Brill challenges the idea that hospitals have any justification for their high prices, and details a litany of hospital pricing markups of routine medical supplies such as alcohol wipes by more than a hundredfold. He tells story after story of patients charged extraordinary prices for care they could not do without by hospitals with strong profit margins and CEOs making multimillion-dollar salaries.
The Time article was just the latest of at least four articles or reports in the past 15 years that have shaken the faith many Americans have had in the people and places that take care of them. The first of these was “Crossing the Quality Chasm” ( iom.edu/Reports/2001/Crossing-the-Quality-Chasm-A-New-Health-System-for-the-21st-Century.aspx ), the Institute of Medicine’s 2001 report on the quality and safety of patient care in American hospitals. It exposed the frequency and pervasiveness of errors in medical care, the likelihood such errors and inadequacies were causing thousands of deaths each year, and laid the responsibility for fixing our deeply flawed safety systems squarely at the feet of its caregivers. In doing so, the report said the high prices we pay for our care do not systematically buy us greater safety.
The third of these articles was Atul Gawande’s “The Cost Conundrum: What a Texas Town Can Teach Us About Health Care.” (http://www.newyorker.com/reporting/2009/06/01/090601fa_fact_gawande?currentPage=all). In it, he tells the story of two Texas cities that are worlds apart in how patients are cared for, so far apart that Medicare patients in one city cost taxpayers almost twice as much to care for as Medicare patients in the other city, without demonstrably better health as a result. It laid bare the lack of a credible reason for physicians to care for patients so differently.
None of these seminal articles is without flaws, and none tells a complete story. Brill’s article in Time magazine, for example, fails to explain that the bizarre way we price care in hospitals is a direct result of the bizarre way hospitals are paid for that care. It portrays all hospitals as self-serving, failing to describe those hospitals and health systems trying desperately to do right by patients in a payment system that often punishes them for doing that, and working hard to rapidly change their part of this chaotic mess.
Flint Wang was eager to start his third year of medical school, when he would finally break free of the classroom and treat patients. But once in the hospital, Wang, like many classmates, felt insecure and discouraged. Doctors don’t hesitate to point out students’ knowledge gaps. And neither do some patients.
Medical training can be so stressful that it is sometimes difficult to connect with those being treated. “Your knowledge is shaky and you walk around the wards frazzled,’’ said Wang, 25, who nonetheless is glad he decided to become a doctor.
The third year of medical school can be particularly bruising. But growing research suggests that something about this formative but punishing experience may harden students toward patients — a transformation that could persist years down the road.
WASHINGTON — Eight months before President Barack Obama’s health care law goes prime time, a confederation of industry and business groups is ramping up its lobbying apparatus for an 11th-hour assault on the web of new taxes and regulations.
Medical device makers, health insurers, retailers and restaurants are waging what lobbyists call a coordinated effort to gain Senate Democratic support for overturning $130 billion in taxes that will be used to fund the new law, and repealing a mandate requiring employers to provide insurance coverage for full-time workers or pay a fine.
The campaign is backed by two of the business world’s lobbying powerhouses: the U.S. Chamber of Commerce and the National Federation of Independent Business, or NFIB. The latter had a leading role in 2012′s failed attempt to overturn the Patient Protection and Affordable Care Act in the Supreme Court.
Known as Obamacare, the 2010 law will bring sweeping change to the $2.8 trillion U.S. health care industry starting Jan. 1, 2014, including bringing health insurance to millions more Americans.
But with Congress mired in partisan gridlock, lobbyists are gearing up for a battle against the law’s costs that is likely to intensify as lawmakers shift attention to the 2014 congressional elections and the campaign donations they may need.
“It’s going to be a difficult uphill battle. This is the administration’s signature law. We’ve got a split Congress. But there’s an opportunity to make fixes. And if you can garner bipartisan support in the Senate, and find a way that the changes get paid for, I think it can get done,” said Amanda Austin, NFIB’s federal public policy director.
At issue are a 2.3 percent tax on medical devices valued at $30 billion over the next 10 years, a $100 billion health insurance premium tax and the employer mandate, which opponents say could cripple many small business with costly fines.
The critics used Saturday, the third anniversary of the passage of ACA, to warn that the provisions could undercut economic growth, sap technical innovation and raise costs for Medicare beneficiaries and other consumers.
America’s Health Insurance Plans, a Washington-based trade group, told lawmakers that the premium tax, combined with a proposed cut in government payments to Medicare Advantage plans, could raise premiums for elderly and disabled beneficiaries by $50 to $90 a month.
Many small businesses have joined robo-call and email campaigns aimed at lawmakers, and grassroots supporters have begun visiting district offices. Lawmakers who oppose the health care law have joined industry letter-writing campaigns aimed at the White House.
When Fred E. Taylor arrived at Harrison Medical Center in Silverdale, Wash., for a routine prostatectomy, he expected the best medical care new technology had to offer: robotic surgery, billed as safer, less painful and easier on the body than traditional surgery.
The operation, on Sept. 9, 2008, was supposed to take five hours. But it was marred by a remarkable cascade of complications and dragged on for more than 13 hours, leaving Mr. Taylor, who had been an active 67-year-old retiree, incontinent and with a colostomy bag, and leading to kidney and lung damage, sepsis and a stroke.
Mr. Taylor survived his injuries but died last year. Now, his wife, Josette, is suing Intuitive Surgical Inc., the company that makes the equipment and trained the surgeon to use it. As it turned out, the surgeon, Dr. Scott Bildsten, had never before used the robotic equipment without supervision.
“We are the old school, where you trust the doctor,” said Mrs. Taylor, who noted that her husband’s life was so limited after the operation that he used to cry about being “trapped in this body.”
It is not the first time patients have claimed they were harmed by Intuitive’s robotic surgical equipment, called the da Vinci Surgical System. But the Taylor case, set for trial in April, is unusual. Internal company e-mails, provided to The New York Times by lawyers for the Taylor estate, offer a glimpse into the aggressive tactics used to market high-tech medical devices and raise questions about the quality of training provided to doctors before they use new equipment on patients.
Intuitive, based in Sunnyvale, Calif., declined to comment on the lawsuit but said studies showed that its robotic equipment results in better outcomes than conventional open surgery. “The most objective and therefore best measure of efficacy for all of those involved in training — from Intuitive Surgical, the hospitals, the proctors and the surgeons themselves — is represented in the comparative clinical outcomes of da Vinci surgery,” said Angela Wonson, the company’s vice president for communications.
According to Intuitive, 1,371 hospitals in the United States have purchased a da Vinci system, and many have purchased two. Nearly half a million procedures worldwide were performed robotically last year, including prostatectomies and hysterectomies, among other operations.
Reports of complications from robot-assisted surgery are rising, according to Massachusetts health officials who sent hospitals an “advisory” letter last week alerting them about their safety concerns.
In some cases, it appears that doctors have used the aggressively marketed robots to perform hysterectomies and colorectal operations that were too complex for the technology, or for the surgeons’ skill level in directing the robots’ actions.
During one hysterectomy, two surgeons failed to coordinate their movement of the remote-controlled robotic arms, damaging the patient’s bowel and causing excessive bleeding, according to the letter from the Quality and Patient Safety Division, part of the agency that licenses Massachusetts doctors.
In another hysterectomy, a woman was anesthetized and placed for nearly four hours in a steep head-down angle — a position often used during robotic operations. She suffered shoulder injuries. The advisory described a number of mishaps but did not identify the doctors or hospitals involved.
Robotic surgery — in which doctors sit at a video console and remotely move robotic arms holding surgical instruments and a tiny camera — has surged in popularity for prostate operations and other procedures. That’s partly because the manufacturer and hospitals heavily advertise the technology as reducing complications and speeding recovery.
Brigham and Women’s Hospital last fall allowed shoppers to “test drive” a robot outside Macy’s at the Natick Mall, by sitting at the console and manipulating the arms. Community hospitals have jumped on the bandwagon, too. St. Luke’s Hospital in New Bedford invited the public to get behind the controls of its new robot in January, while others including Beth Israel Deaconess Hospital Milton have erected highway billboards.
The hospitals now say they are reviewing some of their marketing activities.
The chief executive of Kaiser Permanente, which is often hailed as a model of health care reform and cost control, said in a Times article recently that “the future of health care is going to be rationing or re-engineering.”
Consumers tend to dislike the idea of rationing, but would it be better than the alternatives? If “re-engineering” means consolidation and vertical integration, is that a good thing for patients? For the industry?
New tools make it easier to find prices for medical procedures
With consumers on the hook for a growing share of their medical bills, doctors, hospitals and health insurers are making prices more readily available.
By Lisa Zamosky
8:12 PM PDT, March 22, 2013
Ever tried to get a firm price tag before going to the doctor or the hospital? Good luck. Historically, the search for healthcare prices has been an exercise in futility.
But that's starting to change. With healthcare costs rising and consumers on the hook for a growing share of their medical bills, doctors, hospitals and health insurers are feeling the pressure to make healthcare prices more readily available.
"We expect consumers to cover more of their care and decide how to expend resources. But it's unacceptable to expect them to do that without providing them with what they need to make price and quality decisions," said Suzanne Delbanco, executive director of the groupCatalyst for Payment Reform.
Last week the nonprofit organization issued a report on medical pricing that graded states' efforts to provide useful pricing information. In all, 36 states got a grade of D or F, including California, which got a D.
Under a state law that took effect in 2006, California hospitals must publish average charges for common procedures on the website of theCalifornia Office of Statewide Health Planning and Development. However, experts warn that typically these indicate what hospitals charge, not what they're paid.
Although the usefulness of price information varies widely, there are a growing number of tools available to help consumers. Here are a few places to look for prices the next time you need to know what that lab test or procedure is going to cost:
• Try FairHealthConsumer.org, an easy-to-use website with a sophisticated cost calculator tool for medical and dental services.
Let's say you've injured your knee and your doctor orders an MRI to see what's going on. You have insurance, but you want to know how much of the test's cost is going to come out of your own pocket.
Once on the site's medical cost estimator you'll input your ZIP Code, indicate whether you have insurance and find your procedure on a drop-down list. Up pops the estimated price.
Also on display will be the amount your insurer is likely to cover (you can adjust percentages based on the details of your health plan) and how much you would pay. You'll also be informed about the extras. For example, a plus sign next to your procedure is a cue that it's coupled with other services likely to drive up the price, said Robin Gelburd, Fair Health's president.
• Pricing sites such as HealthBlueBook.com and NewChoiceHealth.com offer up the average cost that insurance companies pay for many inpatient and outpatient procedures in your area. You can use that as a starting point to negotiate with your doctor. http://www.latimes.com/business/la-fi-healthcare-watch-20130324,0,6675615,print.story
Health-care law uncertainty grips Old Town Alexandria cafe — and other small businesses
The situation only gets thornier for Joyce, who also owns a small art gallery with one full-time employee. Rules proposed this year by the Internal Revenue Service suggest that workers from separate firms owned by the same person will be totaled to determine an employer’s ultimate size. If so, Joyce will probably shift his gallery employee to part-time hours to avoid having to add coverage at his second business.
The IRS proposals include formulas for factoring part-time and seasonal workers into employee totals and calculating the penalty for failing to provide coverage — but none of the rules are set in stone, nor has the agency determined how employers will prove they provide adequate and affordable plans. The IRS is still collecting comments on the proposals and plans a public hearing in late April, so the final rules are not likely to be published until summer.
Meanwhile, many employers have seen theirpremiums rise or plans disappear as insurers prepare for the coming changes.
21 graphs that show America’s health-care prices are ludicrous
By Ezra Klein, Updated:
Every year, the International Federation of Health Plans — a global insurance trade association that includes more than 100 insurers in 25 countries — releases survey data showing the prices that insurers are actually paying for different drugs, devices, and medical services in different countries. And every year, the data is shocking.
The IFHP just released the data for 2012. And yes, once again, the numbers are shocking.
This is the fundamental fact of American health care: We pay much, much more than other countries do for the exact same things. For a detailed explanation of why, see this article. But this post isn’t about the why. It’s about the prices, and the graphs.
One note: Prices in the United States are expressed as a range. There’s a reason for that. In other countries, prices are set centrally and most everyone, no matter their region or insurance arrangement, pays pretty close to the same amount. In the United States, each insurer negotiates its own prices, and different insurers end up paying wildly different amounts. That’s what Steven Brill’s explosive article was about, and it’s why you see U.S. prices expressed as a range rather than a single number.
After all these graphs, this final graph shouldn’t be a surprise.
Low-income California seniors to move into new managed care plan
The 500,000 patients, under Medi-Cal and Medicare, are among state's costliest. Officials hope the Cal MediConnect program will cut spending and improve care.
By Anna Gorman, Los Angeles Times
9:55 PM PDT, March 27, 2013
In a major shift triggered by the national healthcare law, nearly half a million low-income California seniors and disabled patients will begin moving into a new managed care program this fall.
The patients, who receive both Medi-Cal and Medicare, are among the most costly in the state. Officials believe that the program, Cal MediConnect, will reduce spending and improve care by shifting the patients out of a fragmented system and into one that is more coordinated.
The state and the federal government signed an agreement Wednesday officially establishing a test program for the patients, known as dual eligibles.
"We believe it will transform the state's healthcare system," Health and Human Services Secretary Diana Dooley said.
Advocates, however, continue to worry that the transition could affect patients' access to doctors and medications.
"We are concerned about how this is going to translate in the real world for beneficiaries," said Kevin Prindiville, deputy director of the National Senior Citizens Law Center. "There is a lot of change happening very quickly."
BOOTHBAY, Maine — The Maine Small Business Coalition has released a report that shows 39 percent of the state's small-business owners are older than 55 and increasingly reliant on social programs such as Social Security and Medicare.
The coalition released the report, "Business is (Baby) Booming," in Boothbay on Wednesday. It was prepared by the national Main Street Alliance using Census Bureau data.
The coalition says that instead of cutting Social Security and Medicare to balance the federal budget, Congress should close tax loopholes and crack down on tax abuse to bring in more revenue.
The report says a 3 percent cut in Social Security benefits would hurt Maine businesses and take $109 million out of Maine's economy.
Traditionally, the theory driving discussions on the high cost of health care in the United States has been that there is enormous waste in the system, taking the form of excess utilization of care. From that theory it follows that methods of controlling the growth of health spending should focus on ways to reduce the use of unnecessary or only marginally beneficial health care.
Largely overlooked in these discussions has been the elephant in the room: the extraordinarily high prices Americans pay for health care. However, as a group of us noted in a paper in 2004, “It’s the Prices, Stupid,” it is higher health spending coupled with lower – not higher — use of health services that adds up to much higher prices in the United States than in any other member nation of the Organization for Economic Cooperation and Development. Aside from a few high-tech services, Americans actually use less health care and rely on fewer real health-care resources than do residents of other industrialized countries.
Readers who want to get a peek at this elephant in the room should peruse the set of slides published a few days ago by the International Federation of Health Plans, a global network of private health-insurance plans with 100 members in 31 countries. The federation annually surveys prices actually paid for selected health care goods and services in the different countries.
Shown below are three slides from the set:
In most other countries, prices for health care goods and services are not negotiated between individual health insurers and individual physicians, hospitals or drug companies, as they are in the private insurance sector in United States.
Instead prices there either are set by government or negotiated between associations of insurers and providers of care, on a regional, state or national basis. The single prices for other countries shown in the chart therefore can be taken representative of prices actually paid there.
WASHINGTON — As they explore possible fiscal deals, President Obama and Congressional Republicans have quietly raised the idea of broad systemic changes to Medicarethat could produce significant savings and end the polarizing debate over Republican plans to privatize the insurance program for older Americans.
While the two remain far apart on the central issue of new tax revenue, recent statements from both sides show possible common ground on curbing the costs of Medicare, suggesting some lingering chance, however small, for a budget bargain.
Mr. Obama assured House and Senate Republicans during recent separate visits that he could support specific cost-saving changes to Medicare and deliver Democratic votes, though only as part of a “balanced” package that had additional revenues.
Several changes are likely to once again be in his annual budget, which will be released on April 10, after Congress returns from its break. Mr. Obama also plans a dinner with Senate Republicans that night.
In particular, participants say, the president told House Republicans that he was open to combining Medicare’s coverage for hospitals and doctor services. That would create a single deductible that could increase out-of-pocket costs for many future beneficiaries, but also could pay for a cap on their total expenses and reduce the need to buy Medigap supplementary insurance.
Representative Eric Cantor of Virginia, the No. 2 House Republican, proposed much the same in a speech in February. “We should begin by ending the arbitrary division between Part A, the hospital program, and Part B, the doctor services,” he said. “We can create reasonable and predictable levels of out-of-pocket expenses without forcing seniors to rely on Medigap plans.”
While Mr. Cantor’s proposal got little attention at the time, its echo by Mr. Obama hints at a new route toward compromise — in contrast with the budget that House Republicans passed this month that has no chance of Senate approval.
At a time when retiring baby boomers and mounting medical prices have made federal health care spending the biggest single driver of the nation’s rising debt, the House budget from Representative Paul D. Ryan, Republican of Wisconsin, would transform Medicare into a voucherlike system known as premium support, which Mr. Obama and Democrats adamantly oppose. But Mr. Cantor, like Mr. Obama, is suggesting cost-saving changes within the existing Medicare program.
AUGUSTA, Maine — Gov. Paul LePage’s administration is seeking additional federal funds and Medicaid flexibility as a condition for Maine to participate in an expansion of the state’s Medicaid program under the federal Affordable Care Act.
Meanwhile, a Democratic representative from Gorham on Wednesday introduced legislation that would sign Maine up to accept the federal Medicaid expansion funds. Rep. Linda Sanborn, who was joined at a news conference by other Democratic legislators and doctors from the Maine Medical Association and the Maine Osteopathic Association, said the move would save Maine money in the long run while providing more residents with health insurance.
Mayhew’s letter came a week after the LePage administration and federal officials began talks about a potential expansion of Maine’s Medicaid program. LePage, a staunch opponent of the Affordable Care Act, had remained opposed to the expansion but began conversations with officials at the U.S. Department of Health and Human Services after eight other Republican governors endorsed Medicaid expansions in their states despite their opposition to the federal health care law.
Under the health care law, the federal government covers 100 percent of Medicaid expansion costs for newly eligible residents for three years. After that, the federal share gradually drops to 90 percent in 2020 and the states pick up the remaining share. Maine is asking the federal government to cover 100 percent of costs for 10, rather than three, years.
Maine is one of a handful of states that the federal government considers an “expansion state” because it broadened its Medicaid program more than a decade ago to cover many of the residents — including parents and adults without children — who would be newly eligible for Medicaid in most states under the health care law.
Mayhew told Sebelius this situation puts Maine at a disadvantage compared to other states.
Is medical device tax next piece of Obamacare to be scrapped?
The Senate voted 79-20 Thursday evening to repeal a 2.3 percent excise tax on medical devices, dealing a blow to one of the new taxes imposed to pay for health care reform.
The vote isn't binding -- it came on an amendment to the Senate's budget resolution, which is only a framework for future policy. But it showed there's bipartisan support for ditching this tax. Democrats in states with strong medical device industries, such as Minnesota, joined Republicans in voting to repeal it. The tax went into effect in January and already has cost companies $388 million, according to the Medical Device Manufacturers Association.
The tax is "a drain on innovation, on job creation and on our ability to provide groundbreaking medical innovations to patients," said Sen. Orrin Hatch of Utah, who is the ranking Republican on the Senate Finance Committee, which has jurisdiction over tax legislation.
Republican leaders in Congress regularly denounce the 2010 Affordable Care Act and vow to block money to carry it out or even to repeal it. Those political attacks ignore the considerable benefits delivered to millions of people since the law’s enactment three years ago Saturday. The main elements of the law do not kick in until Jan. 1, 2014, when many millions of uninsured people will gain coverage. Yet it has already thrown a lifeline to people at high risk of losing insurance or being uninsured, including young adults and people with chronic health problems, and it has made a start toward reforming the costly, dysfunctional American health care system.
EXPANDING COVERAGE Starting in 2010, all insurers and employers that offer dependent coverage were required to offer coverage to dependent children up to age 26. An estimated 6.6 million people ages 19 through 25 have been able to stay on or join their parents’ plans as result, with more than 3 million previously uninsured young adults getting health insurance. The law requires private health insurers to provide free preventive care, without co-pays or deductibles. Some 71 million Americans have received at least one free preventive service, like a mammogram or a flu shot, and an additional 34 million older Americans got free preventive services in 2012 under Medicare.
Private insurers are now required to cover children with pre-existing conditions, which means that an estimated 17 million such children have been protected against being uninsured.
And more than 107,000 adults have enrolled in a federally run insurance plan for people with pre-existing conditions. The law also bars insurers from canceling policies on sick people; previously, 10,000 people a year had their policies rescinded.
The law appropriated $11 billion over five years to build and operate community health centers, a major factor in increasing the annual number of patients served to 21 million, a rise of 3 million from previous levels. Some $5 billion has been put into a reinsurance program that has encouraged employers to retain coverage for retirees and their families; 19 million people benefited with reduced premiums or cost-sharing.
Drug companies have long enlisted doctors to serve as de facto spokespeople for specific products, and have paid them handsomely to do so.
However, an increase in disclosures by some drug companies in recent years of the amount they pay doctors – disclosures that will be mandatory by next year – appears to be reducing the amount of money those companies are giving doctors in Maine.
From 2010 to 2012, the amount of money paid by drug companies to Maine doctors for speaking engagements dropped by 60 percent, according to data compiled by ProPublica, an investigative journalism website. Money paid to doctors in Maine for research, usually clinical drug trials, increased by 40 percent from 2011 to 2012.
ProPublica launched its Dollars for Docs initiative in 2010 to track the money drug companies spent to test and market their products. The database was recently updated to include disclosures for 2012, including hundreds from Maine.
The list is not comprehensive because not all drug companies are required to disclose the information yet, but it does offer a glimpse into the financial relationships and incentives between pharmaceutical companies and doctors.