Sebelius’s Slow-Motion Resignation From the Cabinet
WASHINGTON — Everyone knew it was a disaster. After Kathleen Sebeliusappeared on “The Daily Show with Jon Stewart” last October, she and her staff at the Department of Health and Human Services felt she had been sandbagged by Mr. Stewart. At the White House, President Obama’s top aides were aghast at her wooden performance.
The White House frustration with Ms. Sebelius crystallized by Thanksgiving, as it became clear in Washington that she would eventually have to go. Republicans were brutalizing her at congressional hearings. The health care website’s problems were consuming the White House. Under mounting pressure from congressional Democrats panicking about the fallout from the health care debacle on their fall campaigns, Mr. Obama had already brought in Jeffrey D. Zients, a management guru, to take control of the crisis from Ms. Sebelius.
In the halls of the Hubert H. Humphrey Building, the hulking structure at the foot of Capitol Hill that houses the sprawling social services agency, it was obvious to members of Ms. Sebelius’s staff that the president’s inner circle was losing confidence in her, several said Friday as the president announced his intention to replace Ms. Sebelius with Sylvia Mathews Burwell, his budget chief.
Number of Americans without health insurance reaches new low
The level is at its lowest since before President Obama took office, says a Gallup survey that indicates 8 million people have gained coverage since September.
By Noam N. Levey
12:05 AM PDT, April 7, 2014
| advertisement |
WASHINGTON — The share of Americans without health insurance has dropped to the lowest level since before President Obama took office, according to a new national survey that provides more evidence the healthcare law is extending coverage to millions of the previously uninsured.
Just 14.7% of adults lacked coverage in the second half of March, down from 18% in the last quarter of 2013, the survey from Gallup found.
The survey results, which track with other recent polling data and enrollment reports, indicate that about 8 million people have gained health insurance since September. That figure takes into account any losses in coverage the law may have brought about by the cancellation of health plans that did not meet the new standards.
Gallup's survey highlights a historic expansion in coverage unparalleled since the creation of Medicare and Medicaid half a century ago.
It also undermines critics' persistent claims that the law has done little to expand health insurance.
"The uninsured rate has been falling since the fourth quarter of 2013 … a sign that the Affordable Care Act, commonly referred to as Obamacare, appears to be accomplishing its goal of increasing the percentage of Americans with health insurance coverage," Gallup's Jenna Levy wrote in an article describing the new poll results.
The gains found by the survey would include several new sources of coverage.
Under the law, Americans could begin shopping Oct. 1 for health coverage on new marketplaces in which insurers could no longer turn away sick customers. As of the end of March, about 7.1 million people had signed up that way, the administration said. Some of them previously had no insurance.
In addition, in about half the states, low-income Americans could sign up for government Medicaid coverage for the first time, an option the law provides to states.
Even more Americans probably gained coverage under provisions of the healthcare law that took effect earlier. Those gains would not be reflected in the survey if people got covered before September.
For example, as many as 3 million young people gained coverage by staying on their parents' health plans until they turn 26.
And more low-income Americans got coverage in states such as California that expanded their safety net programs ahead of 2014.
Without those earlier expansions, the nation's uninsured rate would have been even higher before the marketplaces opened last fall. The percentage of Americans without insurance began climbing in the last year of the George W. Bush administration as the economy slid into recession, and it continued to rise over the following years.
http://www.latimes.com/nation/la-na-obamacare-uninsured-20140407,0,1585689,print.story
Medicaid expansion bill dies, can’t overcome LePage veto
The bill would have extended care to more than 60,000 low-income Mainers. LePage said he didn’t trust the federal government to follow through on its promise to pay for it.
By Eric Russell erussell@pressherald.com
Staff Writer
Staff Writer
AUGUSTA – The Maine Senate on Friday failed to override Gov. Paul LePage’s veto of a bill that would have expanded Medicaid coverage to more than 60,000 low-income Mainers.
The 22-13 vote fell two votes shy of the two-thirds majority needed to overturn to a veto. The bill is now effectively dead.
Even though Senate Democrats knew what the outcome of the vote would be, many spoke passionately Friday to urge their colleagues to support expansion.
Sen. Richard Woodbury of Yarmouth, the chamber’s lone independent, said failure to override would be the “single-most missed opportunity of the 126th Legislature.”
Senate Majority Leader Troy Jackson, D-Allagash, said he thinks it’s embarrassing for lawmakers to deny health care to constituents when most have government-sponsored health care themselves.
“If it’s OK for me, why isn’t it OK for them? They work just as hard as I do,” he said.
Sen. Geoff Gratwick, D-Bangor, who also is a practicing physician, urged lawmakers to listen to their heads and their hearts.
Senate Minority Leader Michael Thibodeau, R-Winterport, said his opposition was not partisan and he respected the passion of his colleagues, but could not support the bill because of its potential burden on an already overburdened system.
Added Sen. Garrett Mason, R-Lisbon Falls, “I don’t have money to pay for other people’s health insurance.”
The bill, in addition to expanding Medicaid, which operates as MaineCare, would have established a managed care system for all 320,000 beneficiaries in an effort to control costs.
It was considered a compromise because two Republicans – Sens. Roger Katz and Thomas Saviello – brought the measure forward.
But Katz and Saviello failed to generate any support among their fellow Republicans, in particular LePage.
Medicaid expansion debate has passed, but Maine still needs to tackle high health care costs
By Les Fossel, Special to the BDN
Posted April 12, 2014, at 5:58 a.m.
The Medicaid expansion debate is largely settled in the Maine Legislature, but lawmakers in Augusta still have a chance to take action that could make a dent in our state’s higher-than-average health care costs.
The U.S. has the highest health care costs on the planet — 50 percent higher than Norway, the next most expensive country — and among the fastest growing costs, yet there are 36 countries with health care systems that rank more effective than ours. Our economic competitors spend much less on health care. Therefore, they can offer lower prices for their goods or use their surpluses to invest in infrastructure improvements.
Maine has the fifth-highest spending per capita for health care among our 50 states and the second fastest-growing costs, yet there are 15 healthier states than Maine. Over 20 percent of our economy is devoted to health care — well over the national average and the highest portion in New England. Competing states spend 40 percent less than we do on health care. The only way we compete is by having some of the lowest wages in America. Is it not an accident that we do not attract younger workers.
Other states with high health care costs have high income. We don’t. We’re 39th from the top in earned income. Our highest income groups get their money from out-of-state sources. When their costs get too high, they can (and do) leave. It is not an accident that our coastal towns, such as Boothbay Harbor, are losing population, but adding part-time residents who do not pay Maine income taxes. Our high health care costs lead directly to high worker’s compensation costs, where we rank eighth.
It is very clear that Maine must lower health care costs to prosper. The excuse that our high health care costs are a direct result of having an older, sicker, lower-income or more rural population is not supported by the facts.
Lincoln County, where I live, has the oldest population and is tied for the lowest earned income county. Our hospital, Lincoln Health, where I serve on the Performance Improvement Committee, ranks as one of the very best rural health care systems in America. Consumer Reports just ranked us as the safest hospital in America. We are the only Maine hospital that has reduced its prices — an example Maine must follow if we are to have the resources to serve the medical needs of Maine people. Yet, because of low Medicare reimbursement rates, at 71 percent of actual costs, and high levels of free care, at 8 percent of revenue, Lincoln Health still faces constant fiscal challenges.
The Affordable Care Act has not, and likely will not, lower our health care costs. Current estimates have health care costs rising just as fast as they have for more than a decade — with Maine again among the states with the fastest growing costs. Unless we reform our cost structure, Maine will run out of money for health care — with no liquor contract to save us.
Shifting costs to the state’s Medicaid program by expanding it under the Affordable Care Act does not solve the problem. It only delays fiscal sobriety.
To prosper, we must lower health care costs. A 5 percent reduction is a realistic near-term goal. What subsidies under the Affordable Care Act and expanding Medicaid can do is buy us some financial breathing room to make the reforms necessary to cut our health care costs down to a sustainable level. The choice is between walking off a cliff or working our way carefully down the slope toward fiscal sustainability so we cause as little harm as possible.
Long-secret Medicare data reveal payments to Maine doctors
By Jackie Farwell, BDN Staff
Posted April 10, 2014, at 10:30 a.m.
More than 20 Maine health providers were paid at least $1 million each from Medicare in 2012, according to a trove of government data released Wednesday that sheds unprecedented light on health care billing across the country.
Of the 23 receiving at least $1 million in Maine, seven were clinical labs or ambulance providers. Individual doctors and surgical centers accounted for the remainder.
Health providers in Scarborough received the top two Medicare payments in Maine. NorDx, a clinical lab that operates under the MaineHealth system, was paid nearly $4 million, the data show. Northeast Mobile Health Services, which describes itself as Maine’s largest ambulance service, was paid $3.4 million in 2012 by the government health insurance program for seniors.
Experts warned the easily data could be misconstrued . While high payment amounts may serve as a red flag for fraud, they don’t necessarily indicate any wrongdoing or reflect a health provider’s salary.
The data revealed individual physicians’ billing practices for the first time nationwide, including the number of visits and procedures and how much doctors were paid. The information, which includes 880,000 providers, was off limits to the public for more than three decades while the American Medical Association successfully fought its release. A federal judge recently lifted that injunction.
The Medicare payments account for a significant chunk of overall medical payments in an older state such as Maine. About 20 percent of Maine’s population, roughly 275,000 residents, is insured under Medicare, the federally funded health insurance program for those ages 65 and older and people with disabilities.
“This is a big deal for Maine because Maine does have proportionally a higher percentage of population in the Medicare program, simply by virtue of our age structure,” said Andrew Coburn, a rural health expert and chairman of the Master of Public Health program at the Muskie School of Public Service at the University of Southern Maine. “As a result, health care providers are more dependent on Medicare than in most other states.”
In Maine, rheumatologists, who treat joint, tissue and autoimmune problems, and ophthalmologists, who treat eye diseases, rounded out the top 20 payments, along with several cancer doctors. All tend to see a large proportion of older patients.
Officials with the Obama administration said releasing the data would give researchers, policymakers and the public a new glimpse into health care spending and physician practice patterns. Publicizing the payment data also may expose fraud in the system, officials said.
While high billers may attract the attention of government fraud inspectors, legitimate doctors may get big payments. The data show only payments to doctors by Medicare, not any private insurers. Doctors who treat a high proportion of Medicare patients, and fewer patients with other forms of health insurance, may bill the program for larger amounts. Physicians also may provide services such as eye surgery that are reimbursed at higher rates, or use much of the money to pay overhead costs, such as for medications and staff payroll.
Some doctors care for a sicker group of patients, which also could lead to higher payments.
Michael DeLorenzo, director of health analytics at the Maine Health Management Coalition, which publishes score cards on hospitals and doctors, applauded Medicare for releasing the data. But more analysis remains to understand how to use the information to improve the cost and quality of health care, he said.
“Just getting this data out there is just the beginning,” he said. “I think it needs a lot of work to put it in proper context.”
A pro-single payer doctor’s concerns about Obamacare
Believe me, the right's approach would be much worse. But the underinsured are getting a worse deal than you think
By Adam Gaffney, MD
Salon, April 11, 2014
As a single-payer advocate who is also a doctor, I was concerned after the Affordable Care Act was passed that it didn’t do enough to combat rising underinsurance. A recent study by the Commonwealth Fund, which used new data to demonstrate that in 2012 some 31.7 million Americans were underinsured (i.e. insured, but still with heavy additional out-of-pocket health care expenses), argued that the burden of underinsurance will likely lessen as the ACA fully unfolds. But is there really reason for such optimism?
This is a complicated issue with many moving parts, so one way to tackle it (before immersing ourselves in the exhilarating policy literature) is to pose a simpler question: if your family is insured, and someone gets seriously sick, can you not worry about going broke?
The short answer: it depends on how much you have in the bank, and on the “out-of-pocket maximum” established by the ACA for your particular plan. The out-of-pocket maximum is the most that you would have to pay (after premiums) on things like co-pays for medications or deductibles for hospitalizations, and it can go as high as $12,700 annually for exchange plans under the ACA. But doesn’t the law provide protection for lower-income individuals, for instance, in the form of reduced out-of-pocket limits? The answer is yes – but to a lesser extent than we initially thought, even though, somehow, no one informed us that things had changed.
After it passed, my concerns about underinsurance re: the ACA revolved around codifying cost sharing measures, like large deductibles and copays, into law. But the out-of-pocket maximums that the law created were admittedly better than nothing, and – as important – were based on income. According to the text of the law, once your family income goes below 400% of the federal poverty level (which for those enrolling now would be less than $94,200 for a family of four) the maximum out-of-pocket limit (now $12,700) would be progressively reduced by either one-third, one-half, or two-thirds, giving (roughly) the following figures for 2014:
http://www.pnhp.org/print/news/2014/april/a-pro-single-payer-doctor’s-concerns-about-obamacare
Salon, April 11, 2014
As a single-payer advocate who is also a doctor, I was concerned after the Affordable Care Act was passed that it didn’t do enough to combat rising underinsurance. A recent study by the Commonwealth Fund, which used new data to demonstrate that in 2012 some 31.7 million Americans were underinsured (i.e. insured, but still with heavy additional out-of-pocket health care expenses), argued that the burden of underinsurance will likely lessen as the ACA fully unfolds. But is there really reason for such optimism?
This is a complicated issue with many moving parts, so one way to tackle it (before immersing ourselves in the exhilarating policy literature) is to pose a simpler question: if your family is insured, and someone gets seriously sick, can you not worry about going broke?
The short answer: it depends on how much you have in the bank, and on the “out-of-pocket maximum” established by the ACA for your particular plan. The out-of-pocket maximum is the most that you would have to pay (after premiums) on things like co-pays for medications or deductibles for hospitalizations, and it can go as high as $12,700 annually for exchange plans under the ACA. But doesn’t the law provide protection for lower-income individuals, for instance, in the form of reduced out-of-pocket limits? The answer is yes – but to a lesser extent than we initially thought, even though, somehow, no one informed us that things had changed.
After it passed, my concerns about underinsurance re: the ACA revolved around codifying cost sharing measures, like large deductibles and copays, into law. But the out-of-pocket maximums that the law created were admittedly better than nothing, and – as important – were based on income. According to the text of the law, once your family income goes below 400% of the federal poverty level (which for those enrolling now would be less than $94,200 for a family of four) the maximum out-of-pocket limit (now $12,700) would be progressively reduced by either one-third, one-half, or two-thirds, giving (roughly) the following figures for 2014:
http://www.pnhp.org/print/news/2014/april/a-pro-single-payer-doctor’s-concerns-about-obamacare
By Nok-Noi Ricker, BDN Staff
Posted April 12, 2014, at 2:25 p.m.
BANGOR, Maine — The state’s medical marijuana law, first approved by Maine voters in 1999, has been amended, and the biggest change replaces the word physician with the words “medical provider.”
The amendment , which was signed into law by Gov. Paul LePage last week and goes into effect in August, will allow nurse practitioners to prescribe the medication, members of Medical Marijuana Caregivers of Maine announced Saturday.
The group offered a free medical marijuana information session downtown at the Big Easy Lounge inside the Charles Inn on Broad Street, organized by downtown gallery owner and patient Roxanne Munksgaard, a member of the group’s patient advocacy committee. The caregivers group also is hosting their third annual Home Grown Maine Medical Marijuana Trade Show next Saturday, April 19, at the Spectacular Event Center.
Hillary Lister of Medical Marijuana Caregivers of Maine said the amendment originally would have banned kief, a stronger form of marijuana also called keefer, and hash, and also would have allowed the state’s Department of Health and Human Services to contract with the Maine Drug Enforcement Agency to inspect caregivers.
“Law enforcement would no longer need a warrant” if the amendment had passed in its original form, Lister said.
“Those sections have been removed, and now the major change that LD 1739 will make to Maine’s law is to allow nurse practitioners to recommend marijuana for medical use,” the Medical Marijuana Caregivers of Maine website states.
“Soon, starting in August, nurse practitioners will be able to write a recommendation,” Lister said.
Maine voters first approved the use of medical marijuana in 1999 and a decade later expanded the law to include more medical conditions and allow medical marijuana patients to legally buy marijuana from the state’s eight nonprofit medical marijuana dispensaries or caregivers.
This Medicaid expansion episode has come to a close — and logic didn’t prevail
Posted April 12, 2014, at 1:59 p.m.
As the Maine Senate returned to a familiar debate Friday about expanding Medicaid coverage to more than 70,000 low-income residents, state Sen. Emily Cain said the 35-member body had a chance to “celebrate April 2014 as the best month for health care ever in Maine.”
On Wednesday, lawmakers from both parties on the budget-writing Appropriations Committee had agreed to a budget-balancing plan that includes funds to shrink the size of state waitlists of people with intellectual disabilities awaiting state services.
The plan also provided funding to boost payments to Maine nursing homes, which have long been underpaid by MaineCare, the state’s Medicaid program.
Lawmakers, however, didn’t complete the trifecta. The Senate came up two votes short of overriding Gov. Paul LePage’s damaging veto of a bill to expand Medicaid coverage to thousands of low-income parents and adults without children.
The Medicaid expansion plan that lawmakers voted on was itself something worth celebrating. It was a deliberate effort by Republican Sens. Roger Katz and Tom Saviello to craft a bill that included something for both sides of the aisle and that did something important for the state.
It expanded Medicaid. It included measures to control costs in an often unwieldy MaineCare program. The expansion it proposed wasn’t permanent, allowing Maine to end expanded coverage the moment federal funding for those newly eligible for coverage dropped below 100 percent.
The bill proposed a deliberate course of action to design the most effective managed care program possible for MaineCare. And it laid out a similarly deliberate course of action to address the high costs of serving Maine residents with intellectual disabilities.
The reasons for rejecting the expansion just don’t add up.
“The fiscal savings promised by Medicaid expansion and managed care are merely mirages,” LePage wrote in his veto message. “Proponents of the bill tout ‘free’ federal money and unspecified state ‘savings’ with no backup for these claims.”
Review all that has been said about Medicaid expansion in recent months — in Maine and across the country. The only references you’ll find to “free” money from the federal government come fromopponents of the expansion putting words in proponents’ mouths.
Of course, the infusion of federal funds Maine could expect to see from expanding Medicaid is not “free.” And that’s precisely a reason why rejecting the expansion is foolish.
Medicaid coverage is expanding to low-income residents in more than half the states as a result of the Affordable Care Act and state policymakers who acted sensibly. As a result, about 2.6 million low-income people are gaining health care coverage.
People in Maine — and every state — are paying for it. Hospitals, in particular, are paying for it. The tax hikes and hospital payment cuts that fund the Affordable Care Act affect every state. The difference in states that aren’t expanding Medicaid is, they’re sharing in the pain without realizing the gain.
Three state projects are giving Maine’s biggest medical users more help, and it’s already paying off in a host of ways
By Lindsay Tice, Sun Journal
Posted April 13, 2014, at 6:14 a.m.
Last year, Tammy Wilson visited the emergency room 38 times.
She knew she went there a lot — too much — but she didn’t know what else to do for her debilitating migraines. In the past she’d seen her primary care doctor and a neurologist, tried over-the-counter drugs and prescriptions. The ER offered the only solution she knew would work, and work fast: an intravenous medication that beat back the agonizing headache enough for her to keep her on her feet as a single mother and the on-site manager for two Travel Inn motels.
“Some days [the ER trip] was two times a day because my migraines were so severe,” she said. “I would try to take care of it at home, but the only thing that worked was going in and getting an IV.”
Then the state took notice.
Wilson is insured through MaineCare, the state-run Medicaid program for the poor, disabled and elderly. The Maine Department of Health and Human Services, which oversees MaineCare, was not happy paying for 38 expensive ER visits for one person in one year.
But in its effort to save money, the department didn’t cut back Wilson’s services.
It gave her more.
Wilson got her own care manager, a state-paid nurse who coordinated Wilson’s care, checked with her after appointments to make sure she was benefiting from them and encouraged her to make herself and her health more of a priority as she dealt with the daily stresses of work and parenthood. Wilson’s primary care doctor saw her more often, working to get her migraines and her blood sugar, which exacerbated the headaches, under control. She got new prescriptions to try.
It all worked.
Wilson, who averaged nearly one ER trip a week last year, has been to the local emergency room only twice in the past four months. One was for a migraine; one was for a possible broken bone after a fall on the ice.
The change has saved the state big ER bills. And Wilson is both happier and healthier.
It sounds counterintuitive: To save money on health care the state should spend more money on health care.
But that’s exactly what Maine is doing.
Spending more on case managers and nurses. More on medications. More on visits to the doctor’s office.
Vermont's Single-Payer Dream Is Taxpayer Nightmare
2479
Of the plans that states have hatched for the Affordable Care Act, none has been bolder than that of Vermont, which wants to implement a single-payer health-care system, along the lines of what you might find in Britain or Canada. One government-operated system will cover all 620,000 of Vermont’s citizens. The hope is that such a system will allow Vermont to get costs down closer to Canada’s, as well as improve health by coordinating care and ensuring universal coverage.
Just two small issues need to be resolved before the state gets to all systems go: First, it needs the federal government to grant waivers allowing Vermont to divert Medicaid and other health-care funding into the single-payer system. And second, Vermont needs to find some way to pay for it:
Now comes the big challenge: paying for it. Act 48 required Vermont to create a single-payer system by 2017. But the state hasn’t drafted a bill that spells out how to raise the approximately $2 billion a year Vermont needs to run the system. The state collects only $2.7 billion in tax revenue each year, so an additional $2 billion is a vexingly large sum to scrape together.
Vermont is a middling-tax state, as states go. And that’s not an accident; its population consists of longtime Vermonters, some of whom vote Republican (at least for governor) and are not super-tax-friendly, and transplants from Massachusetts and New York state, who, last time I looked, had moved to Vermont partly because the taxes were lower. Paying for this program would likely make Vermont the highest-taxed state in the nation, by quite a lot.
Now, you can argue that people should be glad to make this trade-off, not just for peace of mind, but because they will trade higher taxes for lower (no) insurance premiums. You can also argue that poor people in America should be laughing and dancing and singing all day because every one of them is economically better off than starving farmers in drought-ridden regions of Africa. Neither argument will do you much good, however, because that’s not how people think.
Especially when you consider that estimates for this plan's cost are likely to err on the optimistic side, because, well, people drawing up proposed budgets for their pet ideas tend to be a little optimistic. Yes, yes, there may be fabulous cost savings from using the government’s monopoly buying power to bargain prices down with providers. But Vermont is already the beneficiary of significant monopoly buying power: One insurer has 74 percent of the state’s small-group business. It’s a Blue Cross/Blue Shield, so don’t count on fabulous savings from squeezing out profits. The large group market is even more concentrated, though on a for-profit insurer.
Nor can you get much administrative saving at the provider level, because they still have to deal with out-of-state insurers quite a bit. And the once-vaunted fabulous savings from preventative care have mostly turned out not to exist.
So this is going to be expensive. So expensive that I doubt Vermont is actually going to go forward with it.
This should be instructive for those who hope -- or fear -- that Obamacare has all been an elaborate preliminary to a nationwide single-payer system. It isn’t. The politics are impossible, and even if they weren’t, the financing would be unthinkable.
A Number That May Not Add Up
In July 1998, the National Institutes of Health changed what it means to be overweight, defining it as a body mass index of 25 or greater for adults. The cutoff had been 28 for men and 27 for women, so suddenly about 29 million Americans who had been considered normal became overweight even though they hadn’t gained an ounce.
The change, based on a review of hundreds of studies that matched B.M.I. levels with health risks in large groups of people, brought the country in line with definitions used by the World Health Organization and other health agencies. But it also prompted many to question the real meaning of B.M.I. and to note its potential drawbacks: labeling some healthy people as overweight or obese who are not overly fat, and failing to distinguish between dangerous and innocuous distributions of body fat.
More recent studies have indicated that many people with B.M.I. levels at the low end of normal are less healthy than those now considered overweight. And some people who are overly fat according to their B.M.I. are just as healthy as those considered to be of normal weight, as discussed in a new book, “The Obesity Paradox,” by Dr. Carl J. Lavie, a cardiologist in New Orleans, and Kristin Loberg.
Unlike readings on a scale, B.M.I. is based on a person’s weight in relation to his height. It is calculated by dividing weight in kilograms by height in meters squared (or, for those not metric-savvy, weight in pounds divided by height in inches squared and the result multiplied by 703).
According to current criteria, those with a B.M.I. below 18.5 are underweight; those between 18.5 and 24.9 are normal; those between 25 to 29.9 are overweight; and those 30 and higher are obese. The obese are further divided into three grades: Grade 1, in which B.M.I. is 30 to 34.9; Grade 2, 35 to 39.9; Grade 3, 40 and higher.
Before you contemplate a crash diet because your B.M.I. classifies you as overweight, consider what the index really represents and what is now known about its relationship to health and longevity.
Among the surprises nestled in last week's release of Medicarepayment data was this head-scratcher: Of the 50 physicians who got the most Medicare money in 2012, almost half were ophthalmologists. Some of that may come from questionable billings. But it also results from Medicare doctors' perverse incentive to choose more expensive drugs than necessary.
Here's how the system works: When a doctor administers a drug in his or her office, Medicare pays 106 percent of its average selling price. The doctor keeps the extra as compensation for administering the injection.
What has this got to do with eye doctors? The drug Lucentis, used to treat macular degeneration, cost Medicare almost $2,000 a shot in 2012. Another drug, Avastin, which works just as well, costs about $50. If you were the doctor, faced with a system that pays you 6 percent of the drug's cost, which would you choose? That Medicare spent a total of about $1 billion on Lucentis in 2012 suggests most ophthalmologists went with the more expensive one.
This problem goes beyond a single drug. Of the $20 billion Medicare spent on drugs administered by doctors in 2010, 85 percent went to the 55 most expensive ones. In what seems unlikely to be a coincidence, 42 of those drugs also showed an increase in use from 2008 to 2010.
The Centers for Medicare & Medicaid Services, the agency that runs Medicare, says it's required to pay for treatment that a doctor deems medically necessary, and it lacks the authority to direct treatment based on cost. All Medicare can do to control costs is tell doctors the price of what they're prescribing, as well as the alternatives. Which is to say, almost nothing.
To remedy that, President Barack Obama's latest budget request proposed lowering the administrative fee to 3 percent from 6 percent. This would save Medicare an estimated $7 billion over 10 years. Another approach would be to impose a dollar cap on doctors' administrative fees, or set a fixed fee.
Even better would be to adopt the tactics used by private insurers and use price signals to promote the least expensive drug options. That could mean giving doctors a larger administrative fee for choosing generic drugs. Or beneficiaries -- who now pay 20 percent of the cost of the drugs they receive -- could be charged lower copayments when they use generics. The government could even direct doctors to use a generic when one is available.
CMS said it hoped the release of its payment data would help focus the public's attention on doctor payments. It already has. Now it's time to fix them.
To contact the senior editor responsible for Bloomberg View's editorials: David Shipley at davidshipley@bloomberg.net.
No comments:
Post a Comment