Obamacare’s Other Surprise
By THOMAS L. FRIEDMAN
LISTENING to the debate about President Obama’s health care plan, some critics argue that Obamacare is going to need Obamacare — because it’s going to be a “train wreck.” Obama officials insist they’re wrong. We’ll just have to wait and see whether the Affordable Care Act, as the health care law is officially known, surprises us on the downside. But there is one area where the law already appears to be surprising on the upside. And that is the number of health care information start-ups it’s spurring. This is a big deal.
The combination of Obamacare regulations, incentives in the recovery act for doctors and hospitals to shift to electronic records and the releasing of mountains of data held by the Department of Health and Human Services is creating a new marketplace and platform for innovation — a health care Silicon Valley — that has the potential to create better outcomes at lower costs by changing how health data are stored, shared and mined. It’s a new industry.
Obamacare is based on the notion that a main reason we pay so much more than any other industrial nation for health care, without better results, is because the incentive structure in our system is wrong. Doctors and hospitals are paid primarily for procedures and tests, not health outcomes. The goal of the health care law is to flip this fee-for-services system (which some insurance companies are emulating) to one where the government pays doctors and hospitals to keep Medicare patients healthy and the services they do render are reimbursed more for their value than volume.
To do this, though, doctors and hospitals need instant access to data about patients — diagnoses, medications, test results, procedures and potential gaps in care that need to be addressed. As long as this information was stuffed into manila folders in doctors’ offices and hospitals, and not turned into electronic records, it was difficult to execute these kinds of analyses. That is changing. According to the Obama administration, thanks to incentives in the recovery act there has been nearly a tripling since 2008 of electronic records installed by office-based physicians, and a quadrupling by hospitals.
The Health and Human Services Department connected me with some start-ups and doctors who’ve benefited from all this, including Dr. Jen Brull, a family medicine specialist in Plainville, Kan., who said that she was certain she had been alerting her relevant patients to have colorectal cancer screening — until she looked at the data in her new electronic health care system and discovered that only 43 percent of those who should be getting the screening had done so. She improved it to 90 percent by installing alerts in her electronic health records, and this led to the early detection of cancer in three patients — and early surgery that saved these patients’ lives and also substantial health care expense.
Bill Nemitz: Hospitals need to show leadership
Mission statements are not something most organizations take lightly. Each word is carefully chosen, each phrase honed and polished to capture the essence of who you are, what you do and why it's so important.
Take the Maine Hospital Association, for example.
Its mission: "To provide leadership through advocacy, information and education, to support its members in fulfilling their mission to improve the health of their patients and communities they serve."
Did someone say "leadership"?
And might this be the perfect moment for Maine's hospitals to step up and, as they promise in their 27-word raison d'etre, "improve the health of their patients and the communities they serve"?
We wish.
"Our members are now trapped in the middle of a partisan war up here," said Jeff Austin, the Maine Hospital Association's vice president of government affairs and communications, in an interview last week from the State House. "We're not going to participate in it."
Instead, they sit and watch while Gov. Paul LePage and the Legislature's Democratic majority battle each other to a stalemate over a piece of legislation that could well be titled "An Act to Make Maine Hospitals' Dreams Come True."
It's one of those "we wish we could do more, but ..." kind of things.
On the one hand, the association's 39 member hospitals are 100 percent behind LePage's crusade to pay them the $186 million the state owes them for services rendered to Maine'sMedicaid (also known as MaineCare) recipients.
Considering that federal matching funds will bump that payment up to $484 million, what's not to support if you're a hospital CEO looking to fortify your balance sheet?
On the other hand, the hospitals remain strangely silent over the Democrats' insistence that the debt repayment be tied to expansion of MaineCare under the federal Affordable Care Act.
Considering the latter will insure some 60,000 needy Mainers at no cost to the state through 2016 (and no more than 10 percent of the cost after that), why aren't the hospital honchos crowding the steps in the State House Hall of Flags and lending this entire package their full-throated endorsement?
Because LePage has them in his back pocket, that's why. And for that, the leaders of Maine's hospitals should be ashamed of themselves.
"The Maine Hospital Association supports both the Medicaid expansion and the hospital payment," Austin insisted. "Our issue is with the tactic of linkage -- and not with the goal of passing them both."
Translation: The hospitals have for months been held hostage by LePage, who loves the idea of paying the hospital debt (see: 2014 re-election campaign) but hates the idea of expanding Maine's "welfare Medicaid" program (see: tea party talking points).
And now that LePage has vetoed the bill that accomplishes both, the hospital execs have a choice: They can remain on the sidelines and wring their hands over all the partisan wrangling, or they can loudly and publicly call for Republicans in the Legislature to do the right thing this week and override LePage's veto.
So, as LePage is fond of saying, "What's the holdup?"
"It's not that we don't want Medicaid expansion," Austin said. Rather, it's "the condition being put on these overdue bills being paid. It's, 'Go solve this Indiana Jones mission and then we'll pay you.'
Unexpected Health Insurance Rate Shock-California Obamacare Insurance Exchange Announces Premium Rates
Every now and again, a political pundit is required to stand up and admit to the world that he or she got it wrong.
For me, this would be one of those moments.
For quite some time, I have been predicting that Obamacare would likely mean higher insurance rates in the individual market for the “young immortals” and others under the age of 40. At the same time, my expectation was that those who fall into the older age ranges would benefit greatly as their premium charges would be lowered thanks to the Affordable Care Act.
It is increasingly clear that I had it wrong.
Yesterday, Covered California—the name given to the healthcare exchange created pursuant to the Affordable Care Act that will serve the largest population of insured citizens in the nation—released the premium rates submitted by participating health insurance companies for the three health insurance program categories (bronze, silver and gold) established by the Affordable Care Act, along with the catastrophic policy created for and available to those under the age of 30.
Upon reviewing the data, I was indeed shocked by the proposed premium rates—but not in the way you might expect. The jolt that I was experiencing was not the result of the predicted out-of-control premium costs but the shock of rates far lower than what I expected—even at the lowest end of the age scale.
So, why the all too popular narrative that Obamacare would mean unaffordable healthcare premium costs for so many Americans?
Partisan Gridlock Thwarts Effort to Alter Health Law
By JONATHAN WEISMAN and ROBERT PEAR
WASHINGTON — When he talks to Republicans in Congress, Scott DeFife, a restaurant industry lobbyist, speaks their language: President Obama’s health care law is a train wreck well down the track. There will be collateral damage if changes are not made. Friends of the industry cannot sit back and let that happen.
Speaking to Democrats, he puts on his empathy hat: The Affordable Care Act is the law of the land. Its goal of universal insurance coverage is laudable, but its unintended consequences will hurt the cause.
Almost no law as sprawling and consequential as the Affordable Care Act has passed without changes — significant structural changes or routine tweaks known as “technical corrections” — in subsequent months and years. The Children’s Health Insurance Program, for example, was fixed in the first months after its passage in 1997.
But as they prowl Capitol Hill, business lobbyists like Mr. DeFife, health care providers and others seeking changes are finding, to their dismay, that in a polarized Congress, accomplishing them has become all but impossible.
Republicans simply want to see the entire law go away and will not take part in adjusting it. Democrats are petrified of reopening a politically charged law that threatens to derail careers as the Republicans once again seize on it before an election year.
As a result, a landmark law that almost everyone agrees has flaws is likely to take effect unchanged.
“I don’t think it can be fixed,” Senator Mitch McConnell of Kentucky, the Republican leader, said in an interview. “Everything is interconnected, 2,700 pages of statute, 20,000 pages of regulations so far. The only solution is to repeal it, root and branch.”
Senator Max Baucus, Democrat of Montana and one of the law’s primary authors, said: “I’m not sure we’re going to get to the point where it’s time to open the bill and make some changes. Once you start, it’s Pandora’s box.”
As the clock ticks toward 2014, when the law will be fully in effect, some businesses say that without changes, it may be their undoing.
“Are we really going to put the private sector in a situation where there’s a real potential mess for posturing points?” Mr. DeFife asked.
This is not the usual way ambitious laws are carried out, but given the politics of the Affordable Care Act, “we cannot use any of the normal tools to resolve ambiguities or fix problems,” said Sara Rosenbaum, a professor of health law and policy at George Washington University.
The enactment of Medicare in 1965 was followed by changes in 1967, and again in 1972. In November 1986, President Ronald Reagan signed a landmark immigration bill that offered legal status to many unauthorized immigrants. Two years later, Congress made dozens of “technical corrections.”
The Social Security Act of 1935 was followed by the family protection program of 1939, which clarified that benefits could be claimed not just by retirees but also by dependents and survivors of covered workers.
Three years after the Affordable Care Act was enacted, an extensive list of possible fixes and clarifications has piled up. For example, Families USA, a liberal advocacy group and strong supporter of the law, would like to see more money to pay for “navigators” to help enroll the uninsured in the new health care marketplaces.
The Obamacare Shock
By PAUL KRUGMAN
The Affordable Care Act, a k a Obamacare, goes fully into effect at the beginning of next year, and predictions of disaster are being heard far and wide. There will be an administrative “train wreck,” we’re told; consumers will face a terrible shock. Republicans, one hears, are already counting on the law’s troubles to give them a big electoral advantage.
No doubt there will be problems, as there are with any large new government initiative, and in this case, we have the added complication that many Republican governors and legislators are doing all they can to sabotage reform. Yet important new evidence — especially from California, the law’s most important test case — suggests that the real Obamacare shock will be one of unexpected success.
Before I can explain what the news means, I need to make a crucial point: Obamacare is a deeply conservative reform, not in a political sense (although it was originally a Republican proposal) but in terms of leaving most people’s health care unaffected. Americans who receive health insurance from their employers, Medicare or Medicaid — which is to say, the vast majority of those who have any kind of health insurance at all — will see almost no changes when the law goes into effect.
There are, however, millions of Americans who don’t receive insurance either from their employers or from government programs. They can get insurance only by buying it on their own, and many of them are effectively shut out of that market. In some states, like California, insurers reject applicants with past medical problems. In others, like New York, insurers can’t reject applicants, and must offer similar coverage regardless of personal medical history (“community rating”); unfortunately, this leads to a situation in which premiums are very high because only those with current health problems sign up, while healthy people take the risk of going uninsured.
Obamacare closes this gap with a three-part approach. First, community rating everywhere — no more exclusion based on pre-existing conditions. Second, the “mandate” — you must buy insurance even if you’re currently healthy. Third, subsidies to make insurance affordable for those with lower incomes.
Massachusetts has had essentially this system since 2006; as a result, nearly all residents have health insurance, and the program remains very popular. So we know that Obamacare — or, as some of us call it, ObamaRomneyCare — can work.
Political intelligence firms set up investor meetings at White House
By Tom Hamburger,
Wall Street investors hungry for advance information on upcoming federal health-care decisions repeatedly held private discussions with Obama administration officials, including a top White House adviser helping to implement the Affordable Care Act.
The private conversations show that the increasingly urgent race to acquire“political intelligence” goes beyond the communications with congressional staffers that have become the focus of heightened scrutiny in recent weeks.
White House records show that Elizabeth Fowler, then a top health-policy adviser to President Obama, met with executives from half a dozen investment firms in 2011 and 2012. Among them was Kris Jenner, a stock picker with T. Rowe Price Investment Services who managed its $6 billionHealth Sciences Fund.
Separately, an officialin the agency that oversees Medicare and Medicaid spoke in December with managers of hedge funds, pension plans and mutual funds in a conference call. The official, Andrew Shin, was pressed during the 50-minute call for information about upcoming Medicare decisions but declined to discuss matters still under agency review, according to people familiar with the call.
That call and the White House meetings Fowler attended were arranged by political-intelligence firms, an expanding class of consultants in Washington that specialize in providing government information to Wall Street.
Hedge fund executives and other investors are increasingly interested in the timing and nature of health-policy decisions in Washington because they directly affect the profits and stock prices of pharmaceutical, insurance, hospital and managed-care companies. Similar interest surrounds other industry sectors, such as defense, agriculture and energy, whose fortunes are especially dependent on government decisions.
There is no evidence that the private discussions with the two administration officials about health-care decisions provided investors with confidential agency information or that the investors made trades based on what they learned.
But this sort of intelligence gathering has been drawing attention from lawmakers and federal investigators who are looking at whether some traders are gaining access to information that is not available to investors in general or the wider public.
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