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Tuesday, May 5, 2015

Health Care Reform Articles - May 5, 2015


Overkill

An avalanche of unnecessary medical care is harming patients physically and financially. What can we do about it?

BY 

It was lunchtime before my afternoon surgery clinic, which meant that I was at my desk, eating a ham-and-cheese sandwich and clicking through medical articles. Among those which caught my eye: a British case report on the first 3-D-printed hip implanted in a human being, a Canadian analysis of the rising volume of emergency-room visits by children who have ingested magnets, and a Colorado study finding that the percentage of fatal motor-vehicle accidents involving marijuana had doubled since its commercial distribution became legal. The one that got me thinking, however, was a study of more than a million Medicare patients. It suggested that a huge proportion had received care that was simply a waste.
The researchers called it “low-value care.” But, really, it was no-value care. They studied how often people received one of twenty-six tests or treatments that scientific and professional organizations have consistently determined to have no benefit or to be outright harmful. Their list included doing an EEG for an uncomplicated headache (EEGs are for diagnosing seizure disorders, not headaches), or doing a CT or MRI scan for low-back pain in patients without any signs of a neurological problem (studies consistently show that scanning such patients adds nothing except cost), or putting a coronary-artery stent in patients with stable cardiac disease (the likelihood of a heart attack or death after five years is unaffected by the stent). In just a single year, the researchers reported, twenty-five to forty-two per cent of Medicare patients received at least one of the twenty-six useless tests and treatments.
Could pointless medical care really be that widespread? Six years ago, I wrote an article for this magazine, titled “The Cost Conundrum,” which explored the problem of unnecessary care in McAllen, Texas, a community with some of the highest per-capita costs for Medicare in the nation. But was McAllen an anomaly or did it represent an emerging norm? In 2010, the Institute of Medicine issued a report stating that waste accounted for thirty per cent of health-care spending, or some seven hundred and fifty billion dollars a year, which was more than our nation’s entire budget for K-12 education. The report found that higher prices, administrative expenses, and fraud accounted for almost half of this waste. Bigger than any of those, however, was the amount spent on unnecessary health-care services. Now a far more detailed study confirmed that such waste was pervasive.
I decided to do a crude check. I am a general surgeon with a specialty in tumors of the thyroid and other endocrine organs. In my clinic that afternoon, I saw eight new patients with records complete enough that I could review their past medical history in detail. One saw me about a hernia, one about a fatty lump growing in her arm, one about a hormone-secreting mass in her chest, and five about thyroid cancer.
To my surprise, it appeared that seven of those eight had received unnecessary care. Two of the patients had been given high-cost diagnostic tests of no value. One was sent for an MRI after an ultrasound and a biopsy of a neck lump proved suspicious for thyroid cancer. (An MRI does not image thyroid cancer nearly as well as the ultrasound the patient had already had.) The other received a new, expensive, and, in her circumstances, irrelevant type of genetic testing. A third patient had undergone surgery for a lump that was bothering him, but whatever the surgeon removed it wasn’t the lump—the patient still had it after the operation. Four patients had undergone inappropriate arthroscopic knee surgery for chronic joint damage. (Arthroscopy can repair certain types of acute tears to the cartilage of the knee. But years of research, including randomized trials, have shown that the operation is of no help for chronic arthritis- or age-related damage.)


Almost half of Obamacare exchanges face financial struggles in the future


Nearly half of the 17 insurance marketplaces set up by the states and the District under President Obama’s health law are struggling financially, presenting state officials with an unexpected and serious challenge five years after the passage of the landmark Affordable Care Act.
Many of the online exchanges are wrestling with surging costs, especially for balky technology and expensive customer call centers — and tepid enrollment numbers. To ease the fiscal distress, officials are considering raising fees on insurers, sharing costs with other states and pressing state lawmakers for cash infusions. Some are weighing turning over part or all of their troubled marketplaces to the federal exchange, HealthCare.gov, which now works smoothly.
The latest challenges come at a critical time. With two enrollment periods completed, the law has sharply reduced the number of uninsured and is starting to force change in the nation’s sprawling health-care system. But the law remains highly controversial and faces another threat: The Supreme Court will decide by the end of June whether consumers in the 34 states using the federal exchange will be barred from receiving subsidies to buy insurance.
If the court strikes down subsidies in the federal exchange, the states that are struggling financially might be less likely to turn over all operations to the federal marketplace, because they will want to make sure their residents do not lose subsidies to help them buy insurance. If the court upholds subsidies for the federal exchange, some states might step up efforts to transfer operations to HealthCare.gov.
Most exchanges are independent or quasi-independent entities. For most, the main source of income is fees imposed on insurers, which typically are passed on to consumers. Because those fees are based on how many people have signed up (a larger enrollee pool means lower individual costs), strong enrollment is critical to an exchange’s fiscal success.
But for the recently completed open enrollment period, sign-ups for the state marketplaces rose a disappointing 12 percent, to 2.8 million people. That compared with a 61 percent increase for the federal exchange, to 8.8 million people, according to Avalere Health, a consulting firm. States with the smallest enrollment growth are among those facing the greatest financial problems.


Insurance Brokers in Calif., Other States Struggling Under ACA



Insurance brokers in California and other states have struggled financially since the passage of the Affordable Care Act, KPCC'S "KPCC News" reports.

Background

Dede Kennedy-Simington, president of the Los Angeles Association of Health Underwriters, said there are about 500,000 insurance brokers nationally who play an "integral" role in the industry (O'Neill, "KPCC News," KPCC, 4/29). 
In California, more than 12,600 insurance agents are certified to sell health plans through Covered California. Agents assisted 43% of individuals and families who signed up for coverage during the exchange's second open enrollment period (California Healthline, 4/13).

Details of Hardships

Susie Fabrocini -- an insurance broker and owner of Reseda-based Great Life Financials -- said selling health insurance is becoming a less sustainable business under the ACA, in part because customers seek significantly more assistance.
However, under industry regulations, brokers are barred from being paid for post-enrollment advice. Meanwhile, their commissions -- the source of an insurance broker's income -- have been shrinking, according to "KPCC News" ("KPCC News," KPCC, 4/29).
While commission amounts vary, agents typically earn:
  • 1% to 4% of the first annual premium and a smaller percentage for each renewal for private coverage through the exchange;
  • About 6.5% of the first annual premium for enrollees in the Small Business Health Options Program, or SHOP; and
  • A one-time $58 fee for Medi-Cal enrollments (California Healthline, 4/13).
According to "KPCC News," declining commissions can be linked to an ACA provision that requires insurers to spend at least 80% of their income from premiums on medical care instead of on administrative expenses. Under the ACA, insurance brokers are now considered to be part of an insurer's overhead.
As a result, insurers have cut commissions to stay within their overhead budgets, according to UCLA health policy expert Dylan Roby. In some cases, commissions have decreased by half, according to "KPCC News."


Two bills protecting patients in healthcare networks deserve passage

The heathcare reforms in the 2010 Patient Protection and Affordable Care Act remain a work in progress, with some of the law's mandates causing new problems or exacerbating older flaws. One is inaccurate lists of the healthcare providers in insurers' networks; another is surprise bills by out-of-network providers. California lawmakers have offered proposals to solve these problems, and the Legislature should pass them.
Insurers have been exploring ways to hold down rates by signing up smaller networks of doctors and hospitals, and the 2010 law accelerated that trend. Such “narrow networks” can be a good thing for consumers, provided that the doctors on the list can meet the demand for care and have offices throughout the service area.
Still, people want to know before they sign up for a narrow network plan whether they'll be able to keep the doctors they like, or how far they'd have to travel to see someone willing to take new patients. And in too many cases, they've enrolled only to be turned away by doctors who were purportedly in their plan's network, either because the list was inaccurate or the doctors didn't understand their contract with the insurer.
SB 137 by state Sen. Ed Hernandez (D-West Covina) would require insurers to publish provider lists online and update them weekly, including information about office locations, specialties, languages spoken and willingness to accept new patients. To avoid penalties, the lists would have to be at least 97% accurate and be available to anyone who's interested.
In an era of electronic payments and digital health records, it's hard to believe that insurers can't keep track of who's in their networks, what services they provide and where their offices are. Insurers argue that doctors should bear some of the responsibility for the records' accuracy, and they're right; the bill's supporters should explore ways to make sure providers know and abide by what their contracts require.
One reason it's crucial to know who's in a network is that the cost of seeing an out-of-network provider for nonemergency care can be ruinously high. Insurance plans cover a smaller percentage of out-of-network bills, if they cover them at all, and unlike in-network providers, out-of-network doctors don't agree to discounted fees.

Runaway Drug Prices

By 

A drug to treat abnormal heart rhythms can cost about $200 on one day and more than $1,300 the next. A diagnosis of multiple sclerosis can lead to a drug bill of at least $50,000 a year. How companies set prices of specialty drugs for these and other complex diseases, like cancer and AIDS, has been a mystery to the patients who need them. Now the Obama administration and some states are tackling that lack of transparency and the rising costs.
Mr. Obama has asked Congress to let Medicare officials negotiate prices with drug manufacturers, a practice forbidden by current law that may be hard to change with the antiregulatory mood among Republicans. And several states are considering bills that would require drug companies to justify their prices to public agencies. It is the least the states can do to bring costs to levels that patients, hospitals and government programs can afford.
Spending on all prescription drugs, including commonly used medicines like antibiotics, accounts for a tenth of the nation’s total health spending. Prices have been rising slowly in recent years mainly because many brand-name drugs lost protection and lower-cost generics were prescribed. But there are fewer patent expirations ahead. Specialized medicines already on the market carry huge price tags, as The Times reported recently, and strain the budgets of Medicare, Medicaid and consumers. The list price for a one-year’s supply of Kalydeco to treat cystic fibrosis is $311,000. A standard course of treatment with Blincyto, a leukemia drug, is about $178,000.
Drugs used to treat multiple sclerosis are of particular concern. A recent study by researchers in Oregon found that first-generation drugs that came on the market in the 1990s ranged in price from $8,000 to $11,000 a year. Prices for those drugs rose even though new drugs entered the market, theoretically providing competition. One drug that first cost $8,700 now costs $62,400 a year.
There are no multiple sclerosis drugs available in the United States with a list price below $50,000 a year, the researchers say, which is two to three times more than the list prices in Canada, Australia or Britain.
The drug and biotech companies contend that high prices are justified to cover the large costs of bringing a drug to market and to compensate for the large number of drugs that fail in late stages of costly clinical trials. But it appears that many companies raise prices arbitrarily and charge what public and private insurers will pay.
A recent report in The Wall Street Journal described how Valeant Pharmaceuticals International, based in Canada, bought the rights to two lifesaving heart drugs on Feb. 10 and raised their prices the same day. The list price for a one-milliliter vial of Isuprel, used to treat abnormal heart rhythms, rose to $1,347 from $215. The price for a two-milliliter vial of Nitropress, for dangerously high blood pressure and acute heart failure, increased from to $806 from $258. The Journal cites similar increases for Ofirmev pain injections and Vimovo pain tablets after new companies acquired the rights.

Brunswick nursing home owner to pay $300,000 in settlement on overbilling Medicare

by Ben Brogan - BDN Staff

BRUNSWICK, Maine — The owner of several Brunswick assisted living facilities will pay $300,000 to resolve a federal lawsuit charging it allowed a subcontractor, RehabCare Group East, Inc., to routinely submit inflated Medicare claims for rehabilitation.
In March, Bangor nursing home Ross Manor agreed to pay $1.2 million to resolve similar allegations concerning claims for therapy purportedly provided by RehabCare Group East, Inc. The rehab provider was part of similar settlements in Massachusetts, Minnesota and Missouri.
Rousseau Management Inc. owns Horizons Living and Rehab Center, Skolfield House, and Dionne Commons in Brunswick and previously provided administrative management services to Amenity Manor nursing home in Topsham.
Rousseau Management subcontracted with RehabCareGroup East, Inc., a subsidiary of Kindred Healthcare, Inc., to provide rehabilitation therapy at Horizons Living and Rehab Center and Amenity Manor, according to a release from Massachusetts U.S. Attorney Carmen M Ortiz.
The federal government charged that before Oct. 1, 2011, Rousseau submitted or caused the submission of inflated Medicare claims for providing “unreasonable, unnecessary, unskilled rehabilitation therapy, or therapy that was not provided at all,” Ortiz said.


House Passes G.O.P. Budget Aiming to Repeal Health Law

By THE ASSOCIATED PRESS

WASHINGTON — The House on Thursday adopted a compromise Republican budget that aims to repeal the Affordable Care Act while giving the Pentagon an additional $38 billion next year.
The 226-to-197 vote sends the nonbinding budget plan to the Senate for a vote next week. The joint House-Senate blueprint promises to balance the budget in nine years through more than $5 trillion in spending cuts, though Republicans have made clear that they are not interested in actually imposing large cuts to programs like Medicare, food stamps, Pell Grants or Medicaid with follow-up legislation.
Senate Republicans, skittish about politically dangerous cuts to Medicare, blocked a House move that called for giving subsidies to future retirees to purchase health insurance on the open market instead of a guaranteed package of coverage.
Under congressional procedures, lawmakers first adopt a budget that is essentially a visionary document, and follow it up with binding legislation to set agency budgets, cut or raise taxes, and make changes to so-called mandatory programs like Medicare and food stamps, whose budgets run as if on autopilot.
Republicans promote what they call the long-term economic benefits of a balanced budget and say it is better to tackle the financial problems of programs like Medicare and Medicaid sooner rather than later.
But Democrats say the Republican plan unfairly targets the middle class and the poor while leaving in place lucrative tax breaks for corporations and the wealthy.


Tracking Worms Troubles to Monitor a Country’s Health

    MAY 4, 2015 
    By DONALD G. McNEIL Jr.
    To draw attention to the connection between worms and prosperity, scientists recently created a “worm index.”
    The index ranks the world’s 25 most populous countries by how big a problem they have with three types of worms: intestinal soil-borne ones that cause stunting and anemia, especially in children; water-snail-borne ones that cause bloody urine and damage the bladder, vagina, rectum and liver; and mosquito-borne worms that cause the grotesque swelling of elephantiasis.
    The index then compares those countries by their rankings in the United Nations human development index, which includes not just income, but years of schooling and years lived in good health.
    The comparison was published last week in PLOS Neglected Tropical Diseases, of which one of the study’s authors, Dr. Peter J. Hotez, is a co-editor. Dr. Hotez is also the dean at Baylor College of Medicine’s National School of Tropical Medicine.
    Not surprisingly, the richest countries have virtually no worms, and the poorest, like Nigeria and the Democratic Republic of Congo, have widespread infestations.
    But there were surprises among the middle-income countries.
    India, Indonesia and the Philippines had worse worm problems than they “ought” to, given their economic standing. Pockets of intense poverty — usually among ethnic minorities or aboriginal peoples — appear to have pushed them down the index, the authors said.
    Meanwhile, Egypt, Iran and Thailand did better than their economies would have suggested.


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