Thursday, July 28, 2016

Health Care Reform Articles - July 28, 2016

Medicare-style system needed for Americans

By Richard Master
The Morning Call (Allentown, Pa.), Letters, July 19, 2016
Reflecting on the story, "New peak for U.S. health care spending," that annual U.S. health care cost has surpassed $10,000 per person: That's an astounding figure that should wake up readers, that our health care system is eating the rest of the U.S. economy alive. Clearly, other countries of the industrialized world deal with health care more effectively.
Vince Mondillo of Easton and I researched and produced "Fix It ... Healthcare at the Tipping Point," a documentary at that describes our administratively complex and costly system. Unfortunately, the Affordable Care Act was a compromise measure that expanded coverage to more citizens but further entrenched commercial insurance companies' costly practices.
"Fix It" presents the business case, the economic case, for a Medicare-for-all system. Single-payer reform has worked to provide superb care to all citizens in many countries of the industrialized world. It's not a government takeover but tax-financed, privately delivered health care.
We Americans are unfortunately stuck in the Dark Ages, trying to put a shine on an archaic, complex expensive health care system that works for special business interests (Big Pharma, insurance companies, massive hospital networks and, yes, the media through advertising revenues) but doesn't work for our society.

Richard Master is CEO of MCS Industries Inc., Palmer Township, and executive producer of "Fix It ... Healthcare at the Tipping Point." He resides in Bethlehem.

Olympus told U.S. executives no broad scope warning needed despite superbug outbreaks
by Chad Terhune - LA Times

Faced with superbug outbreaks in three countries by early 2013, Japanese device giant Olympus Corp. told U.S. executives not to issue a broad warning to American hospitals about potentially deadly infections from tainted medical scopes, internal emails show.
After two dozen infections were reported in French and Dutch hospitals, the company alerted European customers in January 2013 that a scope it manufactured could become contaminated.
A top Olympus executive in the U.S. grew concerned because the company was investigating a similar outbreak at a Pittsburgh hospital.
“Should [we] also be communicating to our users the information that [Olympus Europe] is communicating to their European users?” Laura Storms, vice president of regulatory and clinical affairs in Center Valley, Pa., asked in an email to Tokyoheadquarters on Jan. 31, 2013.
No, that’s not necessary, said Susumu Nishina, the company’s chief manager for market quality administration in Tokyo in a Feb. 6, 2013, reply.
It is “not need[ed] to communicate to all the users actively,” Nishina wrote, because a company assessment of the risk to patients found it to be “acceptable.”  However, he added that Storms should respond to questions from a customer. 
Outbreaks of infection at hospitals in Los Angeles, Milwaukee, Denver and other cities followed over the next three years. All told, at least 35 people at U.S. hospitals have died since 2013 – three of them at UCLA’s Ronald Reagan Medical Center – after suffering infections from contaminated gastrointestinal scopes manufactured by Olympus, according to hospitals and public health officials.
Olympus’ actions – and inaction – are being closely examined in lawsuits by American patients and their families who contend that the manufacturer was negligent and might have prevented the outbreaks and deaths had it been more forthcoming. In addition, federal prosecutors are investigating Olympus’ handling of the infections – and the emails could become crucial evidence in any future case.
The company’s internal emails reveal conflicts inside Olympus over how to respond to a growing threat to patient safety, pitting U.S. executives against their superiors in Japan who had the final say. The emails were filed in a Pennsylvania court this month as part of a patient lawsuit and obtained by Kaiser Health News working in collaboration with the Los Angeles Times.
Olympus, which controls 85% of the U.S. market for gastrointestinal scopes, declined to comment on the emails, citing the pending litigation. It also declined to discuss the ongoing investigation by the U.S. attorney’s office in New Jersey.
Storms, Nishina and other company officials named in the emails didn’t respond to requests for comment.
In a statement, the company said “patient safety is our top priority. The duodenoscope issue continues to receive the highest level of attention at Olympus, and we remain committed to working with the proper authorities and our stakeholders to understand and address the potential root causes.” The company declined to address why it didn’t feel it was necessary to inform U.S. hospitals when it was alerting those in Europe.
At the time of the safety alert in Europe, Olympus was already aware that design flaws could make it difficult to clean its duodenoscope for the next patient. Used in about 700,000 procedures annually in the U.S., the snake-like device is put down a patient’s throat to diagnose and treat problems in the digestive tract such as cancers and blockages in the bile duct.
As The Times reported in December, an investigator hired by Olympus and a Netherlands hospital concluded in a June 2012 report that the scope’s design could allow blood and tissue to become trapped, spreading bacteria from one patient to another. The independent expert called on Olympus to conduct a worldwide investigation and recall all its scopes if similar problems turned up.
A Senate report released this year said Olympus knew about at least three outbreaks – at hospitals in the Netherlands, France and Pittsburgh – affecting an estimated 46 patients when the European alert went out in early 2013.
Inside Olympus, the debate about how to respond to the emerging outbreaks in the U.S. came to a head on Feb. 6, 2013, the emails show.
Just a few hours after her exchange with the Tokyo official, Storms was confronted by her own U.S staff.
Donny Shapiro, a director of regulatory affairs for Olympus in San Jose, Calif., sent an email to Storms and seven other employees with “Duodenoscope safety recall??” in the subject line. He cited the problems in Europe and results from the company’s microbiology lab showing Olympus scopes had tested positive for bacteria at the University of Pittsburgh Medical Center.
“Why was the alert only issued in Europe?” Shapiro asked his colleagues.
Six minutes later, Storms wrote back: “Donny, [Olympus Japan] has determined that a global communication is not required.”

You Probably Don’t Need Dental X-Rays Every Year

by Austin Frat - NYT
My dental hygienist complimented me on the health of my teeth and gums. Then she said something that you, too, have undoubtedly heard while sitting back in the dentist chair.
“Would you like bitewing X-rays? It’s been a year since your last ones. Your insurance will cover them annually.”
The easy answer was: “Yes. Bring on the bitewings!” They are, after all, painless, don’t take much time, and, as I was reminded, would not cost me a penny because they are covered by my insurance.
But the easy answer isn’t necessarily the right one. Do I need bitewing X-rays every year?
The American Dental Association says I don’t, and you may not either. Adults without apparent dental problems do not need dental X-rays of any kind every year, the A.D.A. says. Adults who properly care for their teeth and have no symptoms of oral disease or cavities can go two to three years between bitewing X-rays, according to the A.D.A.
Adults with a high risk of cavities (like those with a history of them) should receive them at least every 18 months, and possibly more frequently, depending on the condition of teeth and gums.
The interval between X-rays is determined by the rate at which cavities develop. Typically, it takes about two years or more for cavities to penetrate adult teeth enamel. The rate is faster for children, so the recommended bitewing intervals are shorter for them.
However, children with adequately spaced primary (baby) teeth and no cavities do not need any dental X-rays. Older children with a low propensity for cavities can go 18 months to three years between bitewing X-rays. Those at the highest risk may need them more frequently.
Bitewing and other dental X-rays have their place; there is risk in not taking them. Sometimes decay can spread quickly. The X-rays help dentists see cavities, gum disease, the position of teeth still below the gum line and other dental conditions not visible with the naked eye. Other kinds of dental and orthodontic imaging — like full-mouth, full-head, panographs or 3-D cone-beam computed tomography — reveal more.
But dentists tend to overuse them. Jay W. Friedman, a dentist who advises Consumer Reports on dental issues, has been warning of overuse of dental imaging since the 1970s. “Many patients of all ages receive bitewing X-rays far more frequently than necessary or recommended,” he said. “And adults in good dental health can go a decade between full-mouth X-rays.”

Pharma trade group says price gougers are outliers, but then accepts two more
by Ed Silverman

File this under “How ironic.”
For months, the trade group representing big drug makers has argued that Valeant Pharmaceuticals and Turing Pharmaceuticals, which was once run by Martin Shkreli, were outliers for brazen pricing practices that outraged Americans.
At every turn, the Pharmaceutical Research and Manufacturers of America has worked hard to convince lawmakers and the public that its members are not the equivalent of “hedge funds” that exist to set sky-high prices while failing to sufficiently invest in developing new medicines.

Among five companies that were just added to its roster, two of them — Jazz Pharmaceuticals and Horizon Pharmaceuticals — have also relied on excessive pricing to fuel their growth, while investing much less than other drug makers in research and development.
This is “intriguing given their pricing strategies and (the) PhRMA effort to distinguish its membership from sharp pricers,” Sanford Bernstein analyst Ronny Gal wrote to investors last week.
Intriguing is one way to describe it. Hypocritical might be another.
Consider Horizon.
In late 2013, the company bought the Vimovo pain reliever from AstraZeneca and, in January 2014, on the first day it could sell the pill, Horizon raised the list price for 60 tablets to $959, a 597 percent increase from $127, according to Truven Health Analytics. This is the same tactic for which Valeant and Turing were criticized. And Horizon has since boosted the price six more times; it’s now at $2,250.
There’s more. Gal also pointed out that Vimovo is actually a combination of two older medicines. So while the company sells the drug at expensive brand-name prices, patients could actually purchase the generic components separately at a more modest cost. The drug is Horizon’s second-biggest seller, by the way, and contributed 22 percent of overall sales last year.
The drug maker’s biggest-selling product is Duexis, a treatment for rheumatoid arthritis and osteoarthritis that similarly combines two older medicines. Horizon launched the pill in 2012 at $190 for a 90-day supply and, since then, has raised the price 10 times. The last price hike took place this past May, when the cost jumped to $2,250, according to Truven.
Meanwhile, Horizon spent 5.5 percent of sales on R&D in 2015. This is well below the nearly 18 percent of sales that the trade group likes to boast the pharmaceutical industry spent overall last year.
A Horizon spokesman argued that pricing is not “a key driver of our business,” and sales growth was due to more prescriptions written. He also maintained that 98 percent of commercially insured patients have copays of $10 or less due to assistance programs. And he added that, over the past two years, prices have remained flat or fallen due to rebates. Of course, any rebates would still be working off higher starting prices, so unless rebates keep pace, costs to payers still go up.
As for Jazz, 72 percent of its sales last year came from just one drug — the narcolepsy medicine, Xyrem. Over the past three years, most Xyrem sales were driven by pricing. During that time, the price of a 180-milliliter bottle rose to $4,455 from $2,707, according to Truven. Gal noted the drug sold for about $70,000 per patient last year, up from $35,000 in 2013.
Jazz was more willing to spend on R&D — 10 percent of sales were funneled in that direction in 2015, which was up from 7 percent during the previous year. But this was still well below the level touted by the trade group. We asked Jazz for a comment, but no one responded.
So what does the trade group say about this?
Nothing. PhRMA declined to put anyone on the phone to explain how it reconciles these practices with its repeated insistence that its members are not aberrant price gougers.
Perhaps the trade group needs the membership fees. Or perhaps, as Gal speculated, this is a sign that the industry is more confident it can deflect any legislative moves on Capitol Hill to rein in pricing.
“Whatever the reason, it’s certainly disturbing to see this sort of pricing behavior become legitimatized by accepting these companies as members,” said John Rother, who heads the National Coalition on Healthcare, a group of insurers and employers, among others, that object to rising drug prices. “And I think it undercuts the assertion this kind of strategy is only characteristic of outliers.”
Indeed, the pharmaceutical industry may find it easy to explain away egregious pricing when one or two companies are involved. But the trade group seems too willing to look the other way in this instance. And maybe after a while, there won’t be any outliers left.

Michael Moore’s latest movie hits Americans where we don’t live

Emmet Meara - Bangor Daily News

Oh, alright. Michael Moore is fat. Michael Moore is sloppy. You can just imagine him with mustard on the front of his shirt. Maybe that’s why I like him so much.
Plus, he enrages caveman conservatives such as “Six-gun” Purcell in South Carolina. That’s a plus.
Last week, I actually watched Moore’s latest work, “Where To Invade Next?” Like all movies today, it was at least 30 minutes too long and in dire need of sharp editing. Moore is so intent on preaching that he forgets he is in the entertainment business.
But in the week sandwiched between the conventions of the two major political parties, the Moore movie illustrates the failure of both parties to create a fair, modern civilization. Despite the title, there is no invasion involved — just an appreciation of the progress of other, smaller countries.
I hate to admit it, but I am a third-degree addict of the show “Cops.” I enjoy the “cinema verite” quality of the show, but I wince every time the SWAT team bashes in a front door and spread eagles all the occupants — for marijuana. Look at the terrible cost of prosecuting these smokers, then imprisoning them for decades.
On his global tour, Moore stops in Portugal, where drugs have been decriminalized. All drugs. Not just marijuana but heroin and crack. Portugal lets you do what you want to do with your body. The crime rate and prison population in Portugal are a tiny fraction of what they are in the U.S. and its endless “War on Drugs.”
Just sayin’.
At his stop in France, Moore shares the gourmet-style meal served every day in French schools. All French schools. Each school meal has a cheese course. The French chef could not explain what a “sloppy Joe” was. When he was filled in, he would not consider adding it to his menu. The French schools have a very highly involved sex education class that would make a Mississippi reverend blush. The result is an illegitimate birth rate, once again, a fraction of what it is in the U.S.
Could we do better?
Are your kids graduating with a degree and a $100,000 student debt? Not in Germany. In Germany colleges are free to all — even a group of Americans who couldn’t afford tuition in Colorado. So many of the courses are in English that language is not a problem, students said.
Everybody hated homework. I certainly did. You cannot believe this, but Finnish schools have done away with homework and seek to educate the “whole person” rather than teaching students to succeed in a single test. The result? The Finnish schools are rated No. 1. In the world.
The U.S. economy GNP leads the world at $17.9 trillion according to my always shaky research. Slovenia comes in just after Tunisia at $49 billion. But tiny Slovenia had no (zero) college tuition, and efforts to establish it are always met with passionate street demonstrations. American students graduate with a crushing financial load. Moore calls Slovenia a “Magic Kingdom.”
Maybe we could learn something.
After watching “Invade,” many American workers might consider moving to Italy. There the very average worker gets eight weeks vacation each year. Many companies offer a bonus for the vacation period. “No sense taking a vacation if you can’t afford to go where you want,” one worker said.
Conservatives say these benefits are created by a tax rate much higher than the U.S. Moore argues that when you add the fees, tuition, health care costs along with maintaining the largest prison population in the world, we already are paying far more than other countries.
Moore might be fat and sloppy. He might have a mustard stain on his shirt. He stomps all over his message for two hours, but I think it might be productive to study the lessons of other countries if we truly profess to love our own.
The lesson I took is that big business, Democrats and Republicans alike use big government to create the New Servant Class — and you are in it.
Slovenia? Watch the movie.

Fraud and Other Threats to Medicare

Last week, when the Department of Justice charged three people in Miami with fraud and other crimes in a $1 billion scheme to bilk Medicare, it was the single largest criminal case in the nine-year history of the Medicare Fraud Strike Force, a coalition of federal, state and local law enforcement agencies. A month earlier, a crackdown by the strike force led to civil and criminal charges against 301 people in dozens of schemes totaling $900 million in allegedly false billings.
Clearly, health care fraud is vast. Less obvious is that prevention, detection and punishment of fraud have improved in recent years, though that would be threatened if the Affordable Care Act of 2010 were weakened, as Republicans have long demanded.
Obamacare provided an additional $350 million to expand the Medicare Fraud Strike Force to nine cities, from only two in 2007, and to develop advanced data and accounting systems to uncover fraud. The law also toughened sentencing for Medicare fraud, in part, by clarifying that prison terms are to be based on the falsely billed amounts, not the amount actually paid out before the fraud was detected.
To date, some 2,000 of 2,900 defendants charged with felony health care fraud in strike force cases have been convicted. Most have been sentenced to prison, not merely probation. In addition, courts have ordered defendants to repay the government more than $5.5 billion, which is about the total amount the government paid out in the frauds that have been prosecuted.
That is just a sliver of the size of Medicare. But progress against fraud goes beyond saving money. Stopping fraud also leads to better care, because billing fraud often involves ordering unnecessary tests for patients and prescribing unnecessary drugs.
Fighting fraud is also crucial to maintaining public confidence in the health care system. Republican opponents of a government role in health care often portray the system as broken and unsustainable. In fact, the Affordable Care Act’s improved fraud detection is only one of several ways it has improved Medicare’s overall financial outlook, as was made clear last month in the annual report of Medicare trustees.
Medicare fraud is a scourge. But those who would weaken the health care system for ideological reasons are an even bigger problem.

Why are doctors plagued by depression and suicide? A crisis comes into focus
A sense of angst was rattling students at the University of Southern California’s Keck School of Medicine. One of their peers had taken his life days before.
Professor Mikel Snow felt the dark undercurrent and knew he had to speak up. So, for the first time, he told his students about his decades-long struggle with depression. As word spread, students across the campus started contacting him to discuss the suicide — and to share their own psychological distress.
“The reaction has been astounding,” Snow said. “It crystallized that this is a much bigger issue than any of us really realized.”
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Suicide among medical students and doctors has been a largely unacknowledged phenomenon for decades, obscured by secrecy and shame.
Now, it’s beginning to emerge from the shadows.
More than 62,000 people — many of them medical professionals and their families — signed a petition this year calling on medical associations to track physician suicides, provide confidential counseling, and require doctor training programs to address a “culture of abuse” too often characterized by bullying, harassment, and humiliation.
Those groups are responding. The Association of American Medical Colleges last month convened a meeting to address an escalating crisis of depressionburnout, and suicide among physicians. Among the ideas under consideration: encouraging medical students to join clubs so they feel less isolated; ensuring that counseling is more accessible and private; and more actively tracking the mental health of students and doctors.
“This is something that the profession as a whole needs to come together around and deal with as a shared concern,” said Dr. Darrell Kirch, president of the AAMC.
He knows the pain firsthand: He lost two students to suicide during his tenure as dean at medical schools in Pennsylvania and Georgia.
The Accreditation Council for Graduate Medical Education, which oversees the doctor training programs known as residencies, is also focusing on the issue. Officials are studying residents’ deaths to determine which might have been preventable, and how to respond. The group sets standards for residencies and is looking at how to strengthen them to protect young doctors’ mental health.
Hospitals, too, are racing to launch support groups, peer counseling, and sessions to teach doctors to manage stress by meditating or keeping journals.
The new attention to physicians’ mental health comes too late for Cheryl Collier, who had no inkling that her 25-year-old son, Sean Petro, had plunged into despair during his third year at USC’s medical school.
“If only he’d said, ‘I’m depressed, I’m unhappy, I don’t know what to do.’ Perhaps I could have helped him,” said Collier, weeping with grief and frustration.
In the weeks after Sean’s death in May, someone mentioned to Collier that medical students and physicians have a high suicide rate. “I had no idea that was even a possibility,” she said.

Saturday, July 23, 2016

Health Care Reform Articles - July 23, 2016

Obamacare’s Kindest Critic

by The New York Times Editorial Board - July History will almost surely rank health care reform as one of President Obama’s greatest accomplishments. About 20 million Americans have insurance that might otherwise have been unaffordable, and the law has cost much less than anticipated. But one senior administration official thinks the Affordable Care Act has fallen short. His name: Barack Obama.
Presidents usually wait until their memoirs to review their work. Not, in this case, Mr. Obama, who recently marked the act’s sixth anniversary with an unusual article in The Journal of the American Medical Association. Health care costs are still much too high, he wrote, and 29 million people still lack coverage. He then sketched some ideas for the presumptive presidential nominees. Hillary Clinton is likely to listen, having proposed improvements of her own. Donald Trump, not so much. He has so far adopted the “repeal and replace” position of his party.
Six years ago, 16 percent of Americans did not have health insurance; that number is now down to 9.1 percent. People forced to pay out of their own pocket were often bankrupted. Some went without care, and others resorted to charity care at emergency rooms. The law has helped many of these people by expanding Medicaid, which insures the poor. For millions of others, it created health care exchanges where people could buy coverage with the help of government subsidies.
The act also required individuals to either buy insurance or pay a penalty (to help spread the costs), while mandating that businesses with more than 50 full-time workers provide insurance to their employees.
Also impressive is what the law has not done. Republicans who derisively labeled the program Obamacare said it would cost jobs and wreck the federal budget. Yet the economy has added more than 14 million jobs since Mr. Obama signed the measure, and, according to the Congressional Budget Office, the law has cost $157 billion, or one-quarter less than was forecast in 2010.
Still, too many people have been left out. For one thing, 19 states, including Florida, North Carolina and Texas, still have not expanded Medicaid, even though the federal government offered to pay the full cost for the first three years and 90 percent starting in 2020. If these states had opted in, four million more people would be eligible. But the Republicans who control the governments in these states are ideologically opposed to the health reform law.
And despite the subsidies, many people still can’t afford health care. For some middle-class families who buy coverage on the exchanges, the cost of insurance and out-of-pocket expenses like co-pays and deductibles can add up to nearly a quarter of household income, according to the Urban Institute. It is no wonder then that nearly 80 percent of those who still do not have insurance say they cannot afford it.
Mr. Obama proposes several fixes. He recommends that the government offer its own health insurance, a so-called public option, on the exchanges in some parts of the country. That could help make health care more affordable in rural areas and smaller cities where only two or three insurers sell coverage. Republicans and some moderate Democrats fear that this could be the first step to a single-payer health care system. But there might be more support for a policy that is intended strictly for people in places with few choices.
Mrs. Clinton supports the public option and has even suggested that people between the ages of 55 and 64 be allowed to buy into Medicare, though she has not yet provided details of how that would work. Mr. Trump has said he wants universal health coverage, and has proposed tax deductions and allowing insurers to sell policies across state borders. Tax deductions would help some people but wouldn’t be enough, experts say. And insurers can already expand into other states as long as they follow the laws and regulations of the states in which they want to do business.
In addition to the public option, lawmakers ought to consider bigger subsidies for insurance offered through the exchanges, an idea Mrs. Clinton supports. This can be done at a modest cost paid for by slightly higher taxes, according to several experts. In addition, both federal and state governments ought to do more to educate people about the subsidies available to help them buy insurance.
The system could also be made more efficient. The Affordable Care Act has pushed insurers, doctors and hospitals to focus on preventive care, as Mr. Obama notes in his article, and lawmakers can build on that progress. Congress, he added, should allow Medicare to negotiate drug prices with pharmaceutical companies, an idea that could help lower costs but faces stiff opposition from Republicans and even some Democrats.
Yet another way to reduce spending on drugs, experts say, is to set up a system under which government pays more for effective medicines than for comparable drugs with less impressive results. The Obama administration recently proposedexperimentally testing these and other changes within Medicare. The pharmaceutical industry is resisting and has pressured legislators to do so, too.
What Mr. Obama has done here is unusual — asking someone else to burnish a legacy of which he is personally proud. If the candidates (and Congress) pay attention, his request may also do a world of good for millions of Americans for whom decent health care remains out of reach.

US Justice Department Steps In to Halt Health Insurance Mega-Mergers

Many credited the reporting of International Business Times journalist David Sirota for drawing attention to potentially deleterious deals
by Diedre Fulton

The U.S. Department of Justice is suing to block two mega healthcare mergers, saying the acquisitions would "fundamentally reshape the health insurance industry" to the detriment of consumers.
The antitrust lawsuits were announced Thursday by Attorney General Loretta Lynch in response to Anthem's $54 billion proposal to acquire Cigna and Aetna's $37 billion bid to takeover Humana.
"If allowed to proceed," Lynch said in prepared remarks, "these mergers would fundamentally reshape the health insurance industry. They would leave much of the multi-trillion dollar health insurance industry in the hands of three mammoth insurance companies, drastically constricting competition in a number of key markets that tens of millions of Americans rely on to receive healthcare."
"If the 'Big Five' were to become the 'Big Three,'" Lynch said, referring to the major health insurance providers, "not only the bank accounts of the American people would suffer—but also the American people themselves."
Eleven states and the District of Columbia joined the attempt to block the Anthem deal, which would combine the nation's second and fourth largest insurers. Eight states and D.C. joined the suit to block the Aetna deal, which combined the third and fifth largest.
In particular, USA Today noted, "[t]he Aetna-Humana deal would combine two of the four largest providers of Medicare Advantage plans, threatening to drive up costs for certain seniors, and would undermine competition in public exchanges in Florida, Georgia and Missouri, the government said."
UnitedHealthcare is currently the largest health insurer in the nation.
Many credited the reporting of International Business Times journalist David Sirota for drawing attention to potentially deleterious Anthem-Cigna merger.
Indeed, Sirota reported Thursday, the "deal hit turbulence" earlier this year:
There were reports of internal management squabbles between the two companies, and then an International Business Times investigative series about the merger set off a firestorm in Connecticut, which has been leading the national multistate review of the transaction. The series—which prompted a state ethics probe—documented personal and familial ties between Cigna and Gov. Dannel Malloy’s lead regulator on the deal. It also documented how Cigna and Anthem had pumped significant campaign contributions into Malloy-linked political groups as his administration led the merger review.
On Twitter Thursday, Sirota called the exposé "one of the biggest investigative stories of my career."
CNN reports that "[b]oth Anthem and Aetna said they intend to fight the suits."
This work is licensed under a Creative Commons Attribution-Share Alike 3.0 License

Maine Joins Suit to Block Anthem's Acquisition of Cigna Corp. 

U.S. Says Florida Network Defrauded Medicare and Medicaid of Over $1 Billion

by Eric Lichtblau - NYT

WASHINGTON — In the biggest health care fraud case the Justice Department has ever brought, prosecutors charged on Friday that the owner of a network of Florida nursing facilities orchestrated an elaborate scheme to defraud Medicare and Medicaid of more than $1 billion over the last 14 years.
The case, featuring allegations of bribes to Miami doctors, hush money to witnesses, and laundering of huge profits through shell companies, shone a light on a lucrative Medicare black market that has surfaced in the last decade.
“Medicare fraud has infected every facet of our health care system,” Wifredo A. Ferrer, the United States attorney in Miami, said Friday in announcing the indictments of the owner of the medical facilities, Philip Esformes, and two others.
Mr. Esformes’s lawyer said on Friday that the businessman, who runs about 30 health care facilities in Florida and other states, “strongly asserts his innocence.”
Prosecutors, however, described him as the “mastermind” of a conspiracy that cycled some 14,000 elderly people in and out of nursing homes and assisted-living facilities, whether they needed medical care or not.
With the help of doctors, pharmacists, health care consultants and other medical personnel who got kickbacks for their roles, the facilities billed Medicare and Medicaid for high-priced drugs, medical procedures and health equipment that the patients either did not need or never received, prosecutors said.
In some cases, they charged, Mr. Esformes’s operation “preyed upon” the elderly patients by giving them narcotics so that they would have to remain longer in the care facilities to treat their addictions and “the cycle of fraud could continue.”
The Justice Department charged that Mr. Esformes, 47, who owns homes in both Miami Beach and the Chicago area, profited handsomely from the ill-gotten proceeds.
He reported assets of $78 million two years ago, and he withdrew more than $4 million in cash over the years from his many banking accounts, using proceeds from the scheme to pay for a $600,000 watch, the leasing of private jets and chauffeured limousines, and periodic trips with escorts to a Ritz-Carlton Hotel in Orlando, prosecutors charged in Federal District Court in Miami.
The scheme produced “staggering losses in excess of $1 billion,” said George L. Piro, the special agent in charge of the F.B.I. office in Miami. Leslie R. Caldwell, who leads the Justice Department’s criminal division, said that the $1 billion in fraudulent billings made the prosecution the biggest that the department had ever brought against individuals in a health care case.
“This was a whole network of people scratching each other’s backs, paying kickbacks and giving each other referrals,” she said. “It shows what people can do when they’re determined to put their hand in the Medicare pot.”
The indictments refer to other unnamed participants accused of taking part in the billing scheme, including doctors and pharmacists, and Ms. Caldwell said the Justice Department was continuing its investigation to determine whether additional charges should be brought.
With evidence of Medicare fraud growing, federal officials have created “strike forces” in Miami and eight other locations in recent years to better identify and prosecute suspects. They have also turned more frequently to data analytics tools to look for red flags. The effort has led to charges against 2,900 people in the last decade, with the fraudulent billings totaling $10 billion.
Ms. Caldwell said that in prosecutions like the one in Miami, “we’re getting better at focusing on the worst of the worst.”
Mr. Esformes has faced legal scrutiny before in Florida and Illinois over the operations of his nursing and assisted-living facilities. In 2006, he and his partners agreed to pay $15.4 million to settle a civil lawsuit brought by federal officials over accusations of Medicare fraud in the Miami area.
But prosecutors charged in the indictment announced on Friday that he continued the fraudulent billings even after that settlement, using intermediaries, shell companies and money laundering operations to disguise the scheme.
He is also accused of trying to pay an associate, Guillermo Delgado, who was prosecuted earlier in the same investigation, to flee to Europe rather than stand trial.
Mr. Esformes is charged with health care fraud, paying and receiving kickbacks, obstruction of justice and other crimes, and prosecutors said he could face a life sentence if convicted. The Justice Department asked on Friday that he be held without bail because his wealth and history made him a risk to flee.
Michael Pasano, a Florida lawyer representing him, said in an email after the charges were announced that “Mr. Esformes is no flight risk and is anxious to get back to his family and to be working on defending against these charges.”
He said that Mr. Esformes asserts his innocence and “insists all billings related to his facilities are legitimate and appropriate.”
As for the details of his client’s lifestyle, he said that “we will not comment on unfair and spurious allegations,” and he added that the Justice Department’s “only purpose” in including them was “to taint and defame Mr. Esformes.”

Lives Upended by Disputed Cuts in Home-Health Care for Disabled Patients

by Nina Bernstein - NYT

Widowed and disabled after a lifetime of New York factory work, including decades making baby dolls with glue that proved to be toxic, Alejandra Negron depends on a little help for nearly every step she takes. For years, she has had just enough help to stay safely in her own tidy one-bedroom apartment in Manhattan, despite pulmonary disease, asthmadiabetesarthritis and a heart condition.
Medicaid, the state and federal health care program for the poor, covers the cost of a home-care aide during the day, and Ms. Negron’s two daughters and a granddaughter take turns staying over at night and on weekends, despite their own jobs and family obligations.
But last winter, that carefully stitched web of caregiving was abruptly torn apart by a call from Senior Health Partners of Healthfirst, a managed care insurance company that has been one of the beneficiaries of Medicaid’s overhaul of long-term care for disabled and aged people in New York. The company informed Ms. Negron that her home care was immediately being cut to 25 hours a week from 50, and her aide, the mother of a 7-year-old, was rescheduled to work from Thursday through the weekend, not Monday to Friday.
“I panicked,” Ms. Negron’s daughter Carmen Hernandez said, recalling the scene she found at her mother’s apartment that day. The aide was in tears, and Ms. Negron, 72, was petrified that she would have to go to a nursing home. “My mother said, ‘If you put me in a home, I’m going to commit suicide.’”
“I started to cry,” Ms. Hernandez added. “I didn’t know what to do.”
Now a detailed report by a coalition of more than 100 nonprofit groups shows that the crisis in Ms. Negron’s family has been repeated in hundreds of households covered by Senior Health Partners. Since January 2015, that company and at least two others have been systematically cutting the hours of home care for their disabled clients, typically without proper notice or legal justification, the study found. By law, only a change in a client’s medical condition or circumstance is supposed to allow a reduction.
The study was co-sponsored by Medicaid Matters, which is an advocate for Medicaid beneficiaries, and by the New York chapter of the National Academy of Elder Law Attorneys. It independently confirms similar allegations made earlier this year in a federal class-action lawsuitfiled against Senior Health Partners and the New York State Health Department on behalf of disabled and aged clients threatened with cuts in home care. And it echoes the patterns explored in articles in The New York Times about the pitfalls of managed long-term care, which beginning in 2012 replaced a fee-for-service system with a flat rate for each patient enrolled, regardless of how much care was provided to them.
The flat rate “creates a perverse incentive” for Senior Health Partners, the lawsuit says. “The less care they provide to each individual, the more they earn.”
Between June 2015 and December 2015, the study found a sixfold increase in hearings that challenged home-care reductions. In more than 90 percent of those 1,042 hearings, the companies lost or simply withdrew proposed cuts when challenged. Though Senior Health Partners is only one of more than 20 such plans in New York, serving about 12 percent of managed long-term care clients, it accounted for 56 percent of those hearings.
Not counting settlements, managed care companies prevailed only 1.2 percent of the time. But the report said that many of the most vulnerable clients had no way to fight cuts, unaware that they could appeal. And even those who prevailed at hearings have often faced new cutbacks, said Elizabeth Jois, a lawyer at the New York Legal Assistance Group.
That was what happened to Ms. Negron, who is one of the named plaintiffs in the lawsuit. Her daughter turned to Ms. Jois, who appealed. When Ms. Hernandez, 54, showed up at the hearing to testify for her mother, taking time off from her job as the newborn screening coordinator at Mount Sinai Beth Israel, the company withdrew its proposed reduction.
But in May, despite its own finding that her mother’s condition had worsened, the company cut her mother’s hours of care to 40 from 50. At a hearing last week, Ms. Hernandez was astonished when the company’s lawyer argued that her mother could urinate or defecate in a “pull-up” diaper and wait in a chair for two or three hours until a family member could leave work and come to change her.he decision is pending.
Senior Health Partners, which calls itself “a not-for-profit managed care organization sponsored by some of the most prestigious and nationally recognized hospitals and medical centers in New York,” said it could not discuss pending litigation.
“Senior Health Partners’ primary concern at all times is the health and well-being of all our members, who are among the most vulnerable citizens of New York,” it added in an emailed statement.
The State Health Department initially declined to respond to the report’s findings, citing the litigation, but then issued a general defense of managed long-term care. It pointed to a survey in which 87 percent of all members said their plan was good or excellent, and it said that members could change plans.
But advocates said most plans shun anyone with many needs and are reluctant to increase hours for patients who need more. The Legal Aid Society is preparing its own litigation against Senior Health Partners on behalf of a woman who is in a wheelchair and whose request for more hours of help was repeatedly denied, even after she was seriously injured in a fall, said Patricia Bath, a spokeswoman for Legal Aid.
That client’s experience reflects Senior Health Partners’ pattern of denying requests for more home care hours, Ms. Bath added, citing a Legal Aid review of more than 135 state decisions issued in the past year for people appealing such denials. Senior Health Partners’ denials have been overturned 80 percent of the time, she said.
At Ms. Negron’s apartment, Ms. Hernandez fought back tears.
“It’s like mental torture,” she said, as her mother dozed after a breathing treatment. “I don’t want her to be by herself if her last breath comes.”

Report on Medicaid Home Care Reductions in New York