Medicare Panel Urges Cuts to Hospital Payments for Services Doctors Offer for Less
By ROBERT PEAR
WASHINGTON — A federal advisory panel said Friday that Congress should move immediately to cut payments to hospitals for many services that can be provided at much lower cost in doctors’ offices.
The Medicare Payment Advisory Commission said the current payment disparities had created incentives for hospitals to buy physician practices, driving up costs for theMedicare program and for beneficiaries. Hospital buyouts of doctors, turning independent practitioners into hospital employees, have also led to higher spending by private insurers and higher co-payments for their policyholders, the commission said.
Congress often adopts ideas suggested by the commission, and hospital executives fear that could happen again as lawmakers search for ways to squeeze savings out of Medicare.
Medicare uses different fee schedules and formulas to pay for services provided in doctors’ offices and in hospital clinics.
“In many cases, a physician’s practice that is purchased by a hospital stays in the same location and treats the same patients,” but “Medicare and beneficiaries pay more for the same services,” the 17-member commission said in a report to Congress.
For example, it said, Medicare pays $58 for a 15-minute visit to a doctor’s office and 70 percent more — $98.70 — for the same consultation in the outpatient department of a hospital. The patient also pays more: $24.68, rather than $14.50.
Likewise, the commission said, when a Medicare beneficiary receives a certain type of echocardiogram in a doctor’s office, the government and the patient together pay a total of $188. They pay more than twice as much — $452 — for the same test in the outpatient department of a hospital. (The test is used to evaluate the functioning of the heart.) The commission urged Congress to “equalize payment rates” or at least reduce the disparities, for doctor’s office visits and hospital clinic visits in which similar patients receive the same or similar services.
Variations in payment “urgently need to be addressed because many ambulatory services have been migrating from physicians’ offices to the usually higher-paid outpatient department setting, as hospital employment of physicians has increased,” the panel said.
Under the changes outlined by the commission, hospital clinics could lose 5 percent of their Medicare revenue. But the Medicare program and beneficiaries could save $1.8 billion a year, the panel said.
Hospitals strenuously oppose the cuts, saying they have many costs that doctors practicing on their own do not have.
Million-Anecdote Baby
By TIMOTHY EGAN
A friend of mine has an adult child with cancer, a young man just old enough to be beyond the age of coverage under his parents’ health care plan. After nearly killing him, the dreaded Hodgkin’s lymphoma is in remission. But he’s still a pariah in the eyes of the insurance industry, which means they can deny him a policy that might save his life.
Not for long. In six months’ time, the heartless practice of refusing to let sick people buy affordable health insurance — private-sector death panels, the most odious kind of American exceptionalism — will be illegal from shore to shore.
“I can’t wait for Obamacare,” my friend gushed the other day. And she’s not alone. About one in 10 people with cancer in this country have been denied health coverage.
The cartoon version of the Affordable Care Act, that much-loathed government takeover of one-sixth of the economy, is now moving from Beltway gasbags and caricaturists into the hands of consumers. Its fate will be determined by the countless anecdotes of people who will apply the law to their lives.
The early indications are that most Americans will be pleasantly surprised. Millions of people, shopping and comparing prices on the exchanges set up by the states, are likely to get far better coverage for the same — or less — money than they pay now. The law, as honest conservatives predicted, before they orphaned their own idea, is injecting competition into a market dominated by a few big names.
You won’t hear this from the entrenched forces that have spent about $400 million denouncing the law on television ads, groups like the Karl Rove-backed Crossroads GPS. They have good reason to fear it: if Obamacare works, the game will be over for those who oppose the most significant change in American life in a generation’s time. You also don’t hear much from Mr. Obama himself; once again, he’s a passive observer of his presidency.
But out among the states that are actively building the foundations of Obamacare, the law seems to be doing what it was supposed to do. In Washington State, nine companies have filed paperwork to offer policies in a region that has long been controlled by three big entities.
“The surprise is that, for many in the individual market, the premiums will be lower and the benefits so much richer,” said Mike Kreidler, the state insurance commissioner in Washington. “Eventually, I can see the Affordable Care Act being embraced like Medicare, because once people get used to this kind of coverage, it’s going to be a pretty abhorrent thing to try and take it away.”
In Oregon, brisk competition will mean real choice for consumers. Starting in October, a 40-year-old resident of Portland can choose between one insurer charging $169 a month or another asking $422 for the same plan. When these rates were first posted not long ago, some of the companies requested a do-over so they could submit lower rates. Yes, lower rates. So much for a government takeover.
In California, 13 companies will compete for the business of 5.3 million or so people expected to purchase insurance through the new exchanges. Officials say the average monthly premium will be $321 — that is, $110 less than the national average predicted by the Congressional Budget Office.
All of the above are for individuals, shopping for their own health insurance as required by the new law. For the majority of Americans, those with employer coverage, Medicare or Medicaid, little will change except that insurers can no longer put a lifetime cap on benefits. The biggest change, the one likely to drive public perception, will be felt by people long denied care because of “pre-existing conditions.” Soon, they will pay the same insurance rates as healthy people, and get second chances at life.
As well, there’s a bonus opportunity for those stuck in jobs they hate, holding on only because they need the health care, for a take-this-job-and-shove-it moment. Moderate-income families qualify for significant bargains, using the subsidies of Obamacare.
Anthem of Maine plans to hire 300 new workers
The jobs at the company's South Portland office come as full implementation approaches for the federal health care law.
SOUTH PORTLAND — Anthem Health Plans of Maine, a unit of WellPoint Inc., plans to hire as many as 300 full-time workers, from entry-level clerks to managers.
A representative for WellPoint/Anthem issued a news release Friday saying 300 jobs will be added at Anthem's office in South Portland.
The jobs, which were advertised Friday afternoon on WellPoint's website and job seeker sites including CareerBuilder.com and Indeed.com, included postings for clerks and claims handlers. The jobs are in South Portland, to serve insured customers across the country.
The job postings offer health insurance and other benefits. Job interviews will be held in July for starting dates in mid-August.
Anthem, a unit of Indianapolis-based WellPoint Inc., will not offer moving assistance. The health insurance company is looking for Maine-based workers.
An Anthem official, who declined to speak on the record, said later that the information was incorrect but declined to elaborate.
WellPoint contacted the Portland Regional Chamber about a week ago to discuss recruiting for the jobs, said Chris Hall, the business organization's chief executive officer.
LePage signs Maine hospital debt payment plan
The governor says he'll also issue $105 million in voter-approved bonds dating back to 2009.
By Michael Shepherd mshepherd@mainetoday.com
State House Bureau
State House Bureau
AUGUSTA — Gov. Paul LePage quietly signed a bill to pay back Maine’s debt to 39 state hospitals on Friday, fulfilling a promise he campaigned on in 2010.
L.D. 1555 calls for borrowing to pay the state's $183.5 million share of debt to hospitals and repaying it with revenue from a soon-to-be negotiated wholesale liquor contract.
Paying off Maine's share of the debt would unlock about $300 million in federal funds, making the package worth nearly a half-billion dollars for the hospitals.
The bill passed unanimously in both houses of the Legislature on Thursday, and LePage’s office announced the bill’s signing in a statement on Friday afternoon. In it, he called paying hospitals “the right thing to do” while renewing his criticism of Democrats, who he says have delayed the hospital payment.
However, Democrats have countered that argument by saying LePage has been stalling, as he vetoed a plan that would have paid the hospitals while expanding Medicaid, the state-federal health care program for the poor.
LePage signs bill to repay Maine’s Medicaid debt to hospitals
Posted June 14, 2013, at 3 p.m.
AUGUSTA, Maine — Gov. Paul LePage achieved one of his top priorities of the 2013 legislative session Friday when he signed into law a bill that sets the stage to pay off the state’s $183.5 million debt to 39 hospitals.
The bill, passed late Thursday night by the Legislature, would use revenue from a renegotiated contract for the state’s wholesale liquor business to finance revenue bonds to pay the hospitals for services they’ve provided under the state’s Medicaid program, MaineCare.
A refinanced contract could bring as much as $40 million in new cash flow to the state on an annual basis, some of that revenue would be used to finance a lump-sum payment to hospitals.
Maine is one of only a handful of states that controls the importation and distribution of hard liquor, but in 2004 the state leased those rights for 10 years to a private company for $125 million.
Steven Michaud, the president of the Maine Hospital Association, said the repayment of Medicaid debt will also pump an additional $300 million into the state’s economy in federal matching funds.
He said the news of the bill’s passage and that LePage had signed it quickly into law removed “a huge, huge financial anchor from the necks of our members.”
“Another big issue is their vendors who are way out waiting for payment, their local vendors, it allows them to get caught up,” Michaud said. “It’s a huge deal because that’s a lot of money to be carrying as a receivable.”
While the payment would be a one-time expenditure for past debts, it would help hospitals, many of which are depending on lines of credit to manage basic expenses like payroll for employees.
“It doesn’t help you with ongoing problems, which they have a lot of right now,” Michaud said. “But it clearly will have a favorable impact in terms of jobs, especially retention right now.”
Michaud said the back payment would put some of the state’s largest employers on more solid financial footing because they would no longer be incurring the costs of interest on that credit.
“We just can’t be more pleased,” Michaud said. “It’s been a long time coming, it has been a wrenching process over the last several months so to see it come to fruition is very satisfying.”
LePage signed the bill with little fanfare and without ceremony Friday.
“Paying our bills is the right thing to do,” LePage said. “It’s just unfortunate that Democrats waited so long to make the right decision for the people of Maine.”
The Legislature controlled by Democrats earlier sent LePage a bill linking the debt repayment plan with legislation that would have allowed the state to accept federal money under the Affordable Care Act to expand MaineCare.
Posted June 14, 2013, at 3:06 p.m.
As State House debate intensified on expanding Medicaid in recent months, Republicans opposed to the initiative, including Gov. Paul LePage, argued that Maine shouldn’t extend health coverage to 50,000 nondisabled adults without children while elderly people and people with disabilities remain on waitlists for community and home support services.
“Today, they ask you to stop sending them to the back of the line behind others who, yes, may be poor, but they are able-bodied and have options and choices that the individuals I’m speaking for today do not have,” Rep. Deborah Sanderson, R-Chelsea, said Wednesday on the House floor.
Sanderson unsuccessfully tried to attach a requirement to the Medicaid expansion bill that the state provide services to all those on waitlists, a move that would have held up the legislation by adding a $75 million-a-year price tag.
If the state had funds to eliminate waitlists for adults with autism and intellectual disabilities, the federal Medicaid program — which pays 62 percent of Maine’s costs — wouldn’t necessarily chip in. Medicaid limits the number of people Maine can serve through the programs that help those with disabilities and autism. The state will reach those limits, but still have waitlists, even after using additional funds provided in the new, two-year state budget passed by lawmakers Thursday.
Democrats have said they share Republicans’ desire to fund services for those on waiting lists but the issue is separate from Medicaid expansion.
“Seventy thousand people will go uninsured if we do not act” on Medicaid expansion, said Rep. Jeff McCabe of Skowhegan, assistant Democratic House leader. “These federal dollars are coming to us specifically for an opportunity. We must accept these dollars, and we must continue to work together to address this waiting list.”
In early June, the waitlist numbers totaled 4,017, according to the state Department of Health and Human Services. The number, however, is fluid and inexact as new people become eligible for those services and some are taken off waitlists as they’re provided services.
There’s also duplication in the numbers as many are on waitlists for multiple services. Plus, many of those 4,000 are receiving one category of service while they wait for another.
“It’s almost problem compiled on problem for families and individuals,” said Nancy Cronin, executive director of the Maine Developmental Disabilities Council. “These are real people with real value who need a little bit of support to be included in the community and be valued members. Without the support, there are going to be problems, really big problems.”
California to Expand Medicaid
By THE ASSOCIATED PRESS
SACRAMENTO — The State Legislature passed a major piece of the federal Affordable Care Act on Saturday, opting to expand Medicaid to 1.4 million low-income people in California as it rushed to meet its deadline to complete a state budget.
The action came a day after lawmakers passed the main budget bill outlining a $96.3 billion spending plan for the fiscal year that starts in July.
Several Democratic lawmakers called Saturday’s vote historic.
“We don’t know for certain that this will contain the costs; that’s certainly the goal,” said Senator Mark Leno, a Democrat from San Francisco. But he said the action was also intended to “make sure that health care is not considered a privilege of the fortunate few, but as a basic human right. That’s what we’re implementing today. This is a big deal.”
Republicans raised concerns about whether California can afford the expansion over the long run, especially once the federal government drops its commitment from 100 percent to 90 percent.
Democrats included a provision in the legislation that allows for future lawmakers to reconsider the expansion if the federal government’s share drops below 70 percent.
“I worry about expectations that we set out for individuals with A.C.A. in California and having the rug pulled out from underneath us without a funding mechanism,” said Senator Ted Gaines, a Republican of Rocklin. “Can we as a state handle that financial burden? I’m very concerned about this.”
Democrats said the expansion would help save lives, keep workers healthy and attract billions of dollars from the federal government into the state.
The president pro tem of the Senate, Darrell Steinberg, a Democrat of Sacramento, noted that taxpayers and those who have health insurance already are paying for the medical care of those who now go without insurance. The Medicaid expansion will cover many of those who now receive uncompensated care, he said.
Panel Tells Congress Medicare Is Unfairly Penalizing Hospitals Serving The Poor
The financial penalties that Medicare imposes on hospitals with high rates of patient readmissions are too harsh for hospitals serving the poor and should be changed, according to a congressional advisory agency.
Since last fall, Medicare has been reducing its payments to 2,213 hospitals under a provision in the health care law that aims to improve quality at the nation's hospitals. The penalties kick in when patients with heart failure, heart attack or pneumonia are readmitted at higher than expected rates within 30 days.
While the Medicare policy seems to be having an effect - facilities are scurrying to keep better tabs on their high-risk patients after discharge - some hospital officials and other experts say the penalties are unfair because hospitals that treat the poorest patients are getting hit harder than others.
http://www.kaiserhealthnews.org/Stories/2013/June/14/medpac-hospital-readmissions-poor-congress.aspx
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