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Saturday, July 5, 2014

Health Care Reform Articles - July 5. 2014

Godzilla has risen: The insurance industry under the ACA

By Emily Dalton, M.D.
When inquired if Godzilla was “good or bad,” producer Shogo Tomiyama likened it to a Shinto “God of Destruction” which lacks moral agency and cannot be held to human standards of good and evil. “He totally destroys everything and then there is a rebirth; something new and fresh can begin,” he said.
Despite all the hopes many of us had for the Affordable Care Act (ACA), the current system of medical insurance is a dysfunctional nightmare. I should know, because I am in the unique position of experiencing it from three perspectives simultaneously: that of a patient who uses an insurance plan, that of a small business owner who purchases insurance for a group of employees, and that of a physician who contracts with and gets paid by insurance companies.
As a patient, I am tricked by the expensive insurance plan I bought. Even though the card says “HSA 2000,” the deductible for my family is actually $4,000. After that the insurance only pays for 70 percent of covered charges when initially we were told 80 percent.
When I call my insurance company to address problems, I must make sure that I have several hours of free time, so that I can stay on hold long enough to get through to the low level representative who has little power to do anything. The disclaimer “Description of covered benefits is not a guarantee of payment” makes me fearful and insecure. I am at the mercy of large, for-profit corporation that is beholden to shareholders and run by greedy CEOs who do not care about me.
Having insurance means little anymore. Deductibles are high, share of costs are high, and many benefits are simply not covered. Deny, deny, deny! The company has so many devious ways of denying payment that even a sophisticated health care “consumer” can be taken by surprise. The reason for denial could be the type of treatment (no counseling for you!), or lack of a contract with a specific provider, or that your medication is non generic, or not on formulary.
Deductibles can vary depending on the type of service: medical, pharmacy, durable medical, or mental health (don’t even mention dental or vision). After my insurance denied the fourth claim submitted, I realize what is going on. In the past insurances could kick you off for getting sick or refuse to accept you for having a pre-existing condition, but now they are legally obliged to accept all comers. However, they have found a new way to shed their undesirable patients: balk, deny, hassle and ignore you until you willingly transfer your diseases to another company. Ah, insurance is wonderful – just don’t get sick!
As a small business owner, I have over 25 employees, most of whom rely on me to provide insurance. Over the past decade, we dread the arrival of each new year, because the insurance plans offered previously are cancelled and replaced by more expensive plans with fewer benefits. Typically we see the price of premiums increase by 25-40 percent. The plans are so complicated we can’t even understand them, and we have three full time medical billing specialists on staff. The alphabet soup of HMOs, EPOs, PPOs, HSAs is overwhelming, the rules that regulate the deductibles, copays, share of cost, prior authorizations and formularies can be mind-boggling, and even if you understand them, remember: Descriptions of benefits are not a guarantee of payment.
As a physician, I have had no end of problems dealing with the nine different insurance companies with which we have contracts. Our office has three full-time employees whose job it is to make sure the claims we send in get paid correctly, each according to its own set of terms. It seems that any reason is good enough for an insurer to underpay or deny payment. If we don’t catch the mistakes, we lose out.
I pay my staff their hourly wage as they beg, bicker and bargain so we can get reimbursed. Sometimes we call the California Medical Association to get help, and sometimes we yell at our insurance broker, but we don’t often reach out to the understaffed, overburdened Department of Insurance or the Department of Managed Health Care. I also pay my staff to overcome other hurdles and barriers the insurance industry has created like “prior authorizations” that are required before patients can get their medications, consults or procedures.
When the ACA was rolled out, our office was also offered a very low reimbursement rate to see a certain insurer’s Covered California patients, so we declined the contract. However, that insurer gave patients deceptive insurance cards that looked identical to those of our contracted patients, and we were also falsely promoted as contracted providers on their website.
Our office and our patients did not find out who had Covered California status and who had regular status until bills were denied, and it fell upon my staff to inform parents that their insurance had not covered their costs and that they owed us money. Dumbfounded and dismayed, families wept and raged at our medical billers.
My newest employee quit because she felt she could not continue in a job that was so hurtful to young families. After sending out patient after patient in tears, she decided the bad karma invoked by performing her duties could not be justified, and she decided to move on to a happier job. When things reach a point where your employees feel like they will face eternal damnation just for doing their job then the system is broken.
Every time the company refuses to pay for a procedure, consult or a medication, the company gets to keep the money! Every time the company suckers some poor clinic into accepting low rates, the company gets to keep the money! Every time the company “forgets” to pay a claim, the company gets to keep the money! Each time the company raises premiums, the company gets to keep the money! The worse they behave, the more money they get. Are we crazy to tolerate such a system?
The Affordable Care Act, despite the best of intentions, has fortified a monster. By mandating that everyone purchase insurance, the industry is stronger and feels emboldened to take even more advantage of patients and health care providers. Exponentially larger and more powerful than the agencies assigned to oversee it, the industry finds ways to circumvent and resist restrictions.
This leech has gotten firmly latched on to the lifeblood of American medicine, and is sucking money and energy out of medical care from all angles. Like a cancer, is has created harmful malfunctioning growths that waste our precious health care dollars. How long are we going to stand for this?
I wish “Obamacare” was what the conservatives imagine it to be and hate -- a comprehensive, Medicare-like, government-run system -- and I wish I could sign up for it.
http://www.pnhp.org/print/news/2014/july/godzilla-has-risen-the-insurance-industry-under-the-aca


HHS can't tell if all people getting Obamacare subsidies are supposed to be eligible


People who log into Healthcare.gov no longer face the technical glitches that plagued the site last fall. But persistent data problems on the back end could pose problems for insurers, enrollees, and the government agencies trying to implement Obamacare.
Between October and December 2013, states using Healthcare.gov experienced over 2.9 million inconsistencies between applications and information in the federal "data hub" that applications are supposed to be verified against, a new federal report found. State insurance exchanges are also still grappling with substantial technical challenges.
It's not clear how many enrollees are affected, because each applicant can have multiple inconsistencies. These inconsistencies also aren't evidence of fraud — one marketplace reported glitches where applications identified infants and young children as being incarcerated when, obviously, they are not.
The vast majority of inconsistencies were associated with citizenship status, income, and whether the applicant had access to affordable insurance through their employer (which would make him ineligible for subsidies).

 Lobby shows why single payer could hurt reproductive rights

Updated by 
There's an argument making the rounds that the Hobby Lobby decision proves the necessity of single payer. "The only way to resolve this mess is to take employers and their 'sincere beliefs' completely out of the picture," writes Michael Hiltzik in the LA Times. "Remove employers and the insurance industry exits with them. What's left is single-payer healthcare, which is the right way to deliver services that are matters of life and death."
For all the virtues of single-payer health care — and there are many — the Hobby Lobby decision underscores one of single-payer's real problems.
At the core of the case is the fact that Obamacare had to decide which health-care services absolutely needed to be covered and which services didn't. One of the services Obamacare deemed essential was contraception. That's what led to the Hobby Lobby case: prior to Obamacare, there was no federal law forcing employers who offered insurance to cover contraceptive care, and so no need for employers to seek exemptions to that law.
A single-payer system heightens the stakes on this kind of decision. The assumption behind some of the Hobby Lobby-based arguments for single payer is that a single-payer system would cover contraception and that would mean everyone's insurance covers contraception. But a Republican-led government could decide that taxpayer dollars shouldn't be going to cover contraception at all, and then a single-payer system means no one's insurance covers contraception.

The hard truth about health care: Government works

Posted by Ezra Klein

Everyone in Washington claims to want the same thing lately: a “serious conversation” about health-care costs. So let’s have one.
Republicans have a plan that has been tried repeatedly but that has never worked. Democrats have a plan that might work in theory, but it is untested at the scale they’ll need for it to work in practice. And both parties are too scared to talk about the only plan that has worked.
But before we get to that plan, I want to tell you about a graph.
I found it buried inside a Kaiser Family Foundation brief entitled “Health Care Spending in the United States and Selected OECD Countries.” Inauspicious, maybe. But it should change the way we think about health-care costs. Because what it shows is that we’ve failed. Failed to control costs. Failed to restrain the growth of government.
And it shows something else, too: Where we’ve failed, others have succeeded.
Everyone knows — or should know — that the United States spends much more than any other country on health care. But the Kaiser Family Foundation broke that spending down into two parts, the government’s share and the private sector’s share (both measured as a percentage of total gross domestic product), then compared the results with figures from 12 other countries that are members of the Organization for Economic Cooperation and Development. And here’s the shocker: Our government spends more on health care than the governments of Japan, Australia, Norway, the United Kingdom, Spain, Italy, Canada or Switzerland.
Think about that for a minute. Canada has a single-payer health-care system. The government is the only insurer of any note. The United Kingdom has a socialized system, in which the government is not only the sole insurer of note but also employs most of the doctors and nurses and runs most of the hospitals. And yet, measured as a share of the economy, our government health-care system is the largest of the bunch.
 And it’s worse than that: Atop our giant government health-care sector, we have an even more giant private health-care sector. Altogether, we’re spending about 16 percent of the GDP on health care. No other country even tops 12 percent. Which means we’ve got the worst of both worlds: huge government and high costs.
MISSED OPPORTUNITIES:
THE CONSEQUENCES OF STATE DECISIONS NOT TO EXPAND MEDICAID
The Council of Economic Advisers July 2014
Summary and Introduction
The Affordable Care Act has expanded high‐quality, affordable health insurance coverage to millions of Americans. One important way in which the Affordable Care Act is expanding coverage is by providing generous financial support to States that opt to expand Medicaid eligibility to all non‐elderly individuals in families with incomes below 133 percent of the Federal Poverty Level.
To date, 26 States and the District of Columbia have seized this opportunity, and since the beginning of the Affordable Care Act’s first open enrollment period, 5.2 million people have gained Medicaid or Children’s Health Insurance Program (CHIP) coverage in these States, a tally that will grow in the months and years ahead as Medicaid enrollment continues. In contrast, 24 States have not yet expanded Medicaid—including many of the States that would benefit most and sometimes because State legislatures have defied even their own governors—and denied health insurance coverage to millions of their citizens. Researchers at the Urban Institute estimate that, if these States do not change course, 5.7 million people will be deprived of health insurance coverage in 2016. Meanwhile, these States will forgo billions in Federal dollars that could boost their economies.
This analysis uses the best evidence from the economics and health policy literatures to quantify several important consequences of States’ decisions not to expand Medicaid. That evidence, which is based primarily on careful analysis of the effects of past policy decisions, is necessarily an imperfect guide to the future, and the actual effects of Medicaid expansion under the Affordable Care Act could be larger or smaller than the estimates presented below. However, this evidence is clear that the consequences of States’ decisions are far‐reaching, with implications for the health and well‐being of their citizens, their economies, and the economy of the Nation as a whole.
http://www.whitehouse.gov/sites/default/files/docs/missed_opportunities_medicaid.pdf

The Crazy Way the Government Buys Billions of Dollars of Drugs


The U.S. government buys a lot of drugs. Purchases by the Pentagon, Medicare, Medicaid, and other federal programs account for more than a quarter of all U.S. retail prescription spending, which reached $263 billion (PDF) last year. You might think that kind of buying power would entitle Uncle Sam to get the best price all the time. If only that were true. The government pays vastly different prices for medicines depending on which office is buying them, according to a new report(PDF) from the Government Accountability Office.
Medicaid, which provides coverage to poor people through state-run programs, gets the best deal. Medicare Part D, which covers the elderly through private insurance, pays the most for brand-name drugs. And the Department of Defense pays the most for generics, according to the GAO’s analysis of what the government paid for 78 common drugs in 2010.
There are lots of explanations for why this is the case, but no good reasons. By law the Department of Defense and Medicaid get some rebates from drugmakers that lower their costs. The GAO looked at the net cost per dose that each program pays. The prices in the chart above are what the U.S. pays after rebates and after beneficiaries contribute their share. For Medicaid, drugmakers’ rebates cut the price by more than half.
It’s a bit of a shell game. Discounts in one program are often offset by higher prices somewhere else—for either the government or private insurers or both.
The GAO makes this clear. Theoretically, the government could save billions if it got the Medicaid rate for all the pharmaceuticals it buys—69 percent lower than Medicare gets for brand-name medicines—if drugmakers didn’t raise other prices to make up for the lost revenue.
“The magnitude of these potential offsetting price increases could depend on a number of factors,” the GAO wrote. “For example, if a large federal program with many beneficiaries became eligible for the discounts, manufacturers might choose to raise prices by a greater amount than they would if a smaller program with fewer beneficiaries became eligible. Manufacturers might choose to raise prices more for drugs with fewer competitors than for drugs with many competitors. Furthermore, because federal prices are generally based on prices paid by nonfederal purchasers such as private health insurers, manufacturers would have to raise prices to those purchasers in order to raise the federal prices.”

Free birth control represents major shift in health care

By Ricardo Alonso-Zaldivar

WASHINGTON — Most privately insured women are getting free birth control under President Obama’s health law, a major coverage shift that’s likely to continue.
This week the Supreme Court allowed some employers with religious scruples to opt out, but most companies appear to be going in the opposite direction.
Recent data from the IMS Institute document a sharp change during 2013. The share of privately insured women who got their birth control pills without a copayment jumped to 56 percent, from 14 percent in 2012.
The law’s requirement that most health plans cover birth control as prevention, at no additional cost to women, took full effect in 2013.
The average annual saving for women was $269. ‘‘It’s a big number,’’ said institute director Michael Kleinrock. The institute is the research arm of IMS Health, a Connecticut-based technology company that uses pharmacy records to track prescription drug sales.
The core of Obama’s law — taxpayer-subsidized coverage for the uninsured — benefits a relatively small share of Americans. But free preventive care — from flu shots to colonoscopies — is a dividend of sorts for the majority with employer coverage.
Expanded preventive coverage hasn’t gotten as much attention as another bonus for the already insured: the provision that allows young adults to remain on their parents’ policy until they turn 26. That may start to change with all the discussion of birth control.

Obamacare is working. Why isn’t Maine taking full advantage of it?

By Theda Skocpol , Special to the BDN
Posted July 04, 2014, at 1:59 p.m.
Each spring my husband and I return to our Maine home, drive around this vast and wonderful state, and catch up with people we did not see over the winter. When we left last fall, one of the waitresses at our favorite diner was wondering if she could get affordable health insurance through the new national health care law. Maine’s government was dragging its feet, and at first information was hard to find. But on our return we learned she is now covered — one of more than 44,000 Mainers who have purchased a good-quality, affordable plan on the health insurance exchange. Almost all of those Mainers got credits from the federal government to help pay their premiums.
After a rocky first few months last fall, Obamacare is proving very successful. A private citizen named Charles Gaba has done the best job of keeping track of the statistics at a website, ACAsignups.net. As of June 30, 2014, Gaba estimates that between 24 and 29 million Americans have gotten new coverage — including 1.6 to 3.1 million young adults now able to stay on their parents’ health plans; 7 to 9.4 million newly insured through Medicaid; and 15.7 to 16.6 million who purchased private insurance plans meeting minimum standards on their state’s official exchange or directly from an insurance company.
Predictions of doom have not panned out. Enemies of reform said Americans would not purchase private insurance plans on the exchanges or, if they did, would not pay their premiums — but more than 8 million signed up, and at least 89 percent of them have already paid. Critics said that most signups would come from people forced to replace canceled plans, but an authoritative Kaiser Foundation study shows that 57 percent of those who purchased plans on the exchanges had no coverage before — and of course the same was true for millions who purchased other plans or got newly enrolled in Medicaid.
The Gallup poll has recorded the sharpest drop in America’s uninsured since it starting tracking the issue. Finally, doomsayers said that young adults would refuse to participate, but millions did sign up (yes, at the last minute), leaving insurance plans in good economic shape.
Year one of Obamacare was so successful that when the second enrollment year begins next November, many new plans will be offered, and prices will stay fairly stable in most states — including in Maine, where a new insurer, Harvard Pilgrim, has decided to offer plans on the exchange.
But the news for Mainers is not all good, because Gov. Paul LePage refused to cooperate with the second major part of health reform — the expansion of Medicaid to cover men and women whose low earnings put them just above the poverty line. If LePage had accepted one of several bipartisan expansion plans approved by legislative majorities, new Medicaid coverage would have become available in 2014 to up to 70,000 more low-income Maine residents, including an estimated 24,390 people who have no other options to get coverage. Until 2020, the federal government would pay 100 percent of the cost (and 90 percent after that).
LePage’s repeated vetoes hurt more than just uninsured Mainers. The Maine Hospital Association and many business groups have endorsed Medicaid expansion because they know it is just plain dumb to turn away federal dollars that would, according to the best estimates, create some 4,400 new jobs, boosting the state’s paltry employment growth. As it is, Maine taxpayers are essentially sending money to other states to cover their uninsured, to help the bottom lines of their hospitals and to expand their businesses.

Obama Weighs Steps to Cover Contraception

By  and 

WASHINGTON — The Obama administration, reeling from back-to-back blows from the Supreme Court this week, is weighing options that would provide contraceptive coverage to thousands of women who are about to lose it or never had it because of their employers’ religious objections.
The administration must move fast. Legal and health care experts expect a rush to court involving scores of employers seeking to take advantage of the two decisions, one involving Hobby Lobby Stores, which affects for-profit businesses, and the other on Wheaton College that concerns religiously affiliated nonprofit groups. About 100 cases are pending.
One proposal the White House is studying would put companies’ insurers or health plan administrators on the spot for contraceptive coverage, with details of reimbursement to be worked out later.
Another would give the administration itself a larger role in offering cost-free coverage to women who cannot get it through their employers, although the option for a new government entitlement appears unrealistic for financial and political reasons.
The White House is under such pressure that no one has been able to work out details of how the alternatives would be financed or administered.
Administration officials said they were determined to ensure the broadest possible coverage of contraceptives for the largest number of women without requiring employers to violate their religious beliefs.
Mark L. Rienzi, a lawyer who represented both Hobby Lobby and Wheaton College, said the administration had the tools to make an alternative solution work. “The government can find other ways to deliver contraceptives to people without forcing nuns and religious colleges to participate,” he said
http://www.nytimes.com/2014/07/05/us/politics/obama-weighs-steps-to-cover-contraception.html?hp&action=click&pgtype=Homepage&version=HpSum&module=first-column-region&region=top-news&WT.nav=top-news


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