Those Indecipherable
Medical Bills? They’re
One Reason Health
Care Costs So Much.
Hospitals have learned to manipulate medical
codes — often resulting in mind-boggling bills.
The catastrophe struck Wanda Wickizer on Christmas Day 2013. A generally healthy, energetic 51-year-old, she suddenly found herself vomiting all day, racked with debilitating headaches. When her alarmed teenage son called an ambulance, the paramedics thought that she had food poisoning and didn’t take her to the emergency room. Later, when she became confused and groggy at 3 a.m., her boyfriend raced her to Sentara Norfolk General Hospital in coastal Virginia, where a scan showed she was suffering from a subarachnoid hemorrhage. A vessel had burst, and blood was leaking into the narrow space between the skull and the brain.
During a subarachnoid hemorrhage, if the pressure in the head isn’t relieved, blood accumulates in that narrow space and can push the brain down toward the neck. Vital nerves that control breathing and vision are compressed. Death is imminent. Wickizer was whisked by helicopter ambulance to the University of Virginia Medical Center in Charlottesville, 160 miles away, for an emergency procedure to halt the bleeding.
After spending days in a semi-comatose state, Wickizer slowly recovered and left the hospital three weeks after the hemorrhage, grateful to be alive. But soon after she returned home to her two teenage children, she found herself confronted with a different kind of catastrophe. Wickizer had had health insurance for most of her adult life: Her husband, who died in 2006, worked for the city of Norfolk, which insured their family while he was alive and for three years beyond. After his death, Wickizer worked in a series of low-wage jobs, but none provided health insurance. A minor pre-existing condition — she was taking Lexapro, a common medicine for depression — meant that her only insurance option was to be funneled into the “high-risk pool” (a type of costly insurance option that was essentially rendered obsolete by the Affordable Care Act and now figures in some of the G.O.P. plans to replace it). She would need to pay more than $800 per month for a policy with a $5,000 deductible, and her medical procedures would then be reimbursed at 80 percent. She felt she couldn’t afford that. In 2011, she decided to temporarily stop working to tend to her children, which qualified them for Medicaid; with trepidation, she left herself uninsured.
And so in early 2014, without an insurer or employer or government agency to run interference between her and the hospital, she began receiving bills: $16,000 from Sentara Norfolk (not including the scan or the E.R. doctor), $50,000 for the air ambulance. By the end of January, there was also one for $24,000 from the University of Virginia Physicians’ Group: charges for some of the doctors at the medical center. “I thought, O.K., that’s not so bad,” Wickizer recalls. A month later, a bill for $54,000 arrived from the same physicians’ group, which included further charges and late fees. Then a separate bill came just for the hospital’s charges, containing a demand for $356,884.42 but little in the way of comprehensible explanation.
In other countries, when patients recover from a terrifying brain bleed — or, for that matter, when they battle cancer, or heal from a serious accident, or face down any other life-threatening health condition — they are allowed to spend their days focusing on getting better. Only in America do medical treatment and recovery coexist with a peculiar national dread: the struggle to figure out from the mounting pile of bills what portion of the fantastical charges you actually must pay. It is the sickness that eventually afflicts most every American.
What’s less understood is the extent to which our current medical-billing system itself is responsible for the high prices patients are charged. There are, of course, many factors that have led to the United States’ record-breaking $3 trillion health care bill: runaway drug prices, excessive testing and sky-high charges for even the most basic medical interventions. But all of those individual price increases have been enabled — indeed, aided and abetted — by the complex system of billing and coding that underlies bills like those sent to Wickizer. That system, with its lines of alphanumeric codes and arcane medical abbreviations, has given birth to a gigantic new industry of consultants, armies of back-room experts whom medical providers and insurance companies deploy against each other in an endless war over which medical procedures were undertaken and how much to pay for them. Caught in the crossfire are Americans like Wanda Wickizer, left with huge bills and indecipherable explanations in languages they cannot possibly understand.
Disease-classification systems originated during an outbreak of the bubonic plague in 17th-century London — epidemiologic constructs to classify and track causes of death and prevent the spread of infections among populations that spoke different languages. In the 1890s, the French physician and statistician Jacques Bertillon further systematized death reporting by introducing the Bertillon Classification of Causes of Death, the first medical-coding system, which was adopted and modified in many countries. It became an official global effort, which was periodically revised by an international commission. During the first half of the 20th century, the number of entries naturally increased with improved understanding of science, and many countries began tabulating not just causes of deaths but also the incidence of diseases.
In the 1940s, the World Health Organization took over stewardship of Bertillon’s system and renamed it to reflect a new, broader focus: the International Statistical Classification of Diseases, Injuries and Causes of Death (ICD). The codes became an invaluable tool, a common language for epidemiologists and statisticians to track the world’s afflictions. But over the last several decades in the United States, codes gradually took on a bedrock financial function as the basis for medical billing. In 1979, the government decided to use what by then were called ICD-9 codes — which specify the patient’s diagnosis — in adjudicating Medicare and Medicaid claims, with some modifications added specifically for that purpose; the United States version was called ICD-9-CM. (The country has recently moved to a new iteration, ICD-10-CM.) For its beneficiaries, Medicare pays a fixed fee for inpatient hospitalization based primarily on the ICD-CM code, which is translated into a DRG (diagnosis-related group) code — which is the immediate basis for reimbursement.
Other insurers followed in making codes the basis for billing. Coding systems begot new coding systems, because few hospitals wanted to be paid according to Medicare’s relatively low DRG standards. And because strategic coding meant increased payment, that begot coding specialists and coding courses and coding degrees. There are now different increasingly complex coding languages that define payment for different kinds of services: CPT codes, for office visits delivered by doctors, as well as HCPCS, ICD-PCS-CM and DRG, for charges that are incurred in the hospital. There are tens of thousands of codes in each lexicon that have become increasingly specific. For example, there are different codes for in-office earwax removal depending on the method used (irrigation or instruments), different codes for delivering different vaccinations and a code for each injection delivered in the hospital. Different insurers also use different coding systems. While Medicare would have most likely considered Wickizer’s brain bleed as DRG 021, if billed to a commercial insurer, it could result in more than a dozen ICD codes and hundreds of HCPCS entries.
Seemingly subtle choices about which code to use can have large financial consequences. If after reviewing a hospital chart of, say, a patient who has just had a problem with his heart, a hospital coder indicates the diagnosis code for “heart failure” (ICD-9-CM Code 428) instead of the one for “acute systolic heart failure” (Code 428.21), the difference could mean thousands of dollars. “In order to code for the more lucrative code, you have to know how it is defined and make sure the care described in the chart meets the criterion, the definition, for that higher number,” says one experienced coder in Florida, who helped with Wickizer’s case and declined to be identified because she works for another major hospital. In order to code for “acute systolic heart failure,” the patient’s chart ought to include supporting documentation, for example, that the heart was pumping out less than 25 percent of its blood with each beat and that he was given an echocardiogram and a diuretic to lower blood pressure. Submitting a bill using the higher code without meeting criteria could constitute fraud.
Each billing decision, then, can be seen as a battle of coder versus coder. The coders who work for hospitals and doctors strive to bring in as much revenue as possible from each service, while coders employed by insurers try to deny claims as overreaching. Coders who audit Medicare charts look for abuse to reclaim money or fraud that needs to be punished with fines. Hospital coders teach doctors — and doctors pay to take courses — to learn how they can “upcode” their charts to a more lucrative level with minimal effort. In a doctor’s office, a Level 3 visit (paid, say, at $175) might be legally transformed into a Level 4 (say, $225) by performing one extra maneuver, like weighing the patient or listening to the lungs, whether the patient’s illness required that or not.
While most hospitals and insurers set their own rates for each level of care, adding a step when interacting with a patient can also bring windfalls. E.R. doctors, for example, learned that insurers might accept a higher-reimbursed code for the examination and treatment of a patient with a finger fracture (usually 99282) if — in addition to needed interventions — a narcotic painkiller was also prescribed (a plausible bump up to 99283), indicating a more serious condition.
Toward the end of the 20th century and into the next, as strategic coding increased, a new industry thrived. For-profit colleges offered medical-coding degrees, and internships soon followed. Because alphanumeric coding languages are as distinct from one another as Chinese is from Russian, different degree tracks are necessary, along with distinct professional organizations that offer their own particular professional exams, certifications and licensing. Hospital systems and insurers — which have become huge, Hydra-like enterprises — now all employ roomfuls of coding-program graduates to perform these tasks. Membership in the American Academy of Professional Coders has risen to more than 170,000 today from roughly 70,000 in 2008.
Individual doctors have complained bitterly about the increasing complexity of coding and the expensive necessity of hiring their own professional coders and billers — or paying a billing consultant. But they have received little support from the medical establishment, which has largely ignored the protests. And perhaps for good reason: The American Medical Association owns the copyright to CPT, the code used by doctors. It publishes coding books and dictionaries. It also creates new codes when doctors want to charge for a new procedure. It levies a licensing fee on billing companies for using CPT codes on bills. Royalties for CPT codes, along with revenues from other products, are the association’s biggest single source of income.
Patients with good health insurance are often blissfully unaware and mostly unaffected by the jockeying that goes on over how to code their bills. But uninsured patients like Wickizer, or (increasingly) those with high deductibles, are stuck with no insurer to argue on their behalf. Her experience with the University of Virginia Medical Center is not unique: Studies have shown that hospitals charge patients who are uninsured or self-pay 2.5 times more than they charge those covered by health insurance (who are billed negotiated rates) and three times more than the amount allowed by Medicare. That gap has grown considerably since the 1980s.
When Wickizer arrived home from the hospital in January 2014, she had trouble concentrating and finding words; she spoke deliberately, slowly. She remembers nothing before February, she says, but relied on help from her parents, who live nearby, and her boyfriend, who is retired from the Navy. She did her best to address the onslaught of bills that began appearing in her mailbox.
First, she took stock of her finances. She paid the rent for the Norfolk apartment that she and her children lived in by renting out a townhouse that she and her deceased husband had bought in Virginia Beach; after paying property tax, insurance and maintenance on the townhouse, she just broke even. She also received about $2,000 a month in Social Security survivor benefits because of her husband’s death. In addition, she had about $100,000 from her husband’s life insurance in a retirement account, which she was also hoping would help pay for her children’s college. With medical bills totaling nearly $500,000 and no health insurance, the numbers didn’t add up. “My dad said: ‘They’ll never expect you to pay that,’ ” Wickizer told me. “But they did.”
As a sign of good faith, she quickly paid $1,500 to the hospital and $1,000 to the doctors and sought to make sense of the bills. Patients today are told to be good medical consumers, but they are asked to write checks for thousands of dollars — in this case hundreds of thousands — with little explanation of what they’re for. Wickizer did what she would have done with a credit-card statement: She contacted the hospital and requested an itemized bill. Her idea was that if she could understand how much she was being charged for each procedure, she could compare the fees with the reimbursements that Medicare or another insurer would pay for those services and begin some kind of negotiation.
A month later, on March 19, the hospital finally sent a list of charges, using medical abbreviations and terminology but not revealing the all-important alphanumeric codes. Despite being 60 pages long, the tally seemed incomplete, leaving out doctor’s charges and including other fees that seemed incidental, like charges for catheters, wires and oxygen. Room charges were vastly different on different days.
Nearly simultaneously, she received a one-page bill for the hospital portion of her care, broken down only into the broadest categories, including $111,162 in room charges, $34,755.75 for pharmacy, $19,653 for labs, $8,640 for the operating room, $8,325 for anesthesia, $1,143 for the recovery room, $44,524 for medical supplies and $40,489 for radiology services, totaling $356,884.42. The bill informed her that the medical center was prepared to offer her its standard 20 percent discount for patients who are uninsured, leaving a “what you owe now” fee of $285,507.58. It noted that the hospital could offer some additional financial assistance, but only if her household of three had assets of less than $3,100 (“such as bank or retirement accounts”), which disqualified Wickizer and very likely most Americans who have ever held a job.
Next, she did her best to find out what Medicare or another insurer would have paid for her hospitalization, hoping to offer the hospital that amount from her retirement account. To understand the Medicare codes, she had to learn a bit of coding language. Would her hospitalization count as Medicare DRG 020 or 021? She estimated that in 2013, her subarachnoid hemorrhage (most likely coded, she determined, as “intracranial hemorrhage or cerebral infarction disorders, DRG 021, with procedures and major comorbidities or complications”), would have been reimbursed by Medicare for about $80,000. Had a member of the armed services experienced the same condition, Tricare, the military insurer, might have paid closer to $70,000. But to know how much a commercial insurer would have paid, she would have to figure out what HCPCS codes the hospital used to calculate her bill, and the hospital did not send those. Hospitals tend to treat their billing strategies — codes and their master price list, called a charge master — as trade secrets vital to their business. State laws and judges tend to respect that as proprietary information.
When the billers called insisting on payment of the full $285,507.58, Wickizer explained, “I don’t have this kind of money.” She offered the hospital and its doctors the $100,000 in her retirement account. They declined and suggested that she sign up for a payment plan of $5,000 a month to the hospital — and a second $5,000 plan for the physicians’ group. It was an untenable amount.
In October 2014, a sheriff affixed a summons to Wickizer’s front door, saying that the university was suing her for nonpayment. Eric Swensen, a spokesman for the University of Virginia, declined to answer questions about the case, citing patient privacy, as governed by HIPAA rules. But he noted that the university provides $270 million worth of free care to patients who meet its criterion for assistance and sets up interest-free payment plans for those who don’t.
After receiving the summons, Wickizer resorted to a technique followed by many a frustrated customer: She went on Facebook, posted her story and solicited advice. (The Facebook group Paying Till It Hurts, where she posted her story, was created in 2014 in connection with a New York Times series that I wrote with the same name.) A handful of experts — patient advocates, billing professionals, lawyers and a coder — volunteered their help pro bono to try to get more information from the medical center and translate the coding that yielded the unaffordable figure. (One notable aspect of our commercialized health system is that for every person who is pushing to profit, there is another who is doing his or her best to protect patients.)
In vetting Wickizer’s bill, the experts encountered roadblocks from the medical center at every turn in a contentious battle that lasted for over a year. Multiple legal requests to review Wickizer’s chart and complete bill — with its coding elucidated — were refused. Nora Johnson, a retired hospital bill-compliance auditor from West Virginia who volunteered to help Wickizer, noted that not revealing the billing codes constituted a violation of federal law. No insurer would have paid the bills without seeing them, allowing at least a rational attempt at negotiation. As Wickizer’s team wrote to the University of Virginia in one of their letters: “No Codes = No Pay.” The University of Virginia Physicians’ Group, which independently charged Wickizer $54,000, eventually turned over its billing codes. Wickizer’s experts were able to use the bill fragments they had received in discovery, supplemented by those codes, to get a better idea of what medical procedures Wickizer received during her three-week hospitalization. From there, they tried to extrapolate how the hospital had, perhaps, coded her case. By examining the cost reports the University of Virginia hospital must file with Medicare, which indicate the amount it spends delivering certain types of care, Christine Kraft, another medical-billing expert, estimated that even by its own calculations, the medical center spent less than $60,000 treating Wickizer.
The stealth battle between hospitals and insurers over bills for each hospitalization, office visit, test, piece of equipment and procedure is costly for us all. Twenty-five percent of United States hospital spending — the single most expensive sector in our health care system — is related to administrative costs, “including salaries for staff who handle coding and billing,” according to a study by the Commonwealth Fund. That compares with 16 percent in England and 12 percent in Canada.
That discrepancy comes, in part, from the prolonged negotiations over payment and the huge number of coders, billers and collectors who have to be compensated: Their salaries and loans from those years of training in obscure languages are folded into those high charges and rising premiums. In addition, as is often the case in warfare, the big conventional army can be at a disadvantage: The insurance companies and government seem to be always one step behind the latest guerrilla tactics of providers’ coders.
For years, creative coding has been winning over what the government calls “correct coding,” meaning coding that gives providers their due, but without exaggeration. Indeed, each attempt by the government to control questionable coding to enhance providers’ revenue has seemed to only fuel more attempts. In 1996, for example, Medicare’s National Correct Coding Initiative made it clear that certain codes couldn’t appear on the same bill because they were inherently part of the same procedure. As a rule, an anesthesiologist could not, for example, separately bill for anesthesia and checking your oxygen level during your surgery. But the government created Modifier 59 — a code that could be appended to other codes to allow doctors to take exceptions to that rule in unusual cases. Modifier 59 could be used to allow for two payments in certain situations, such as when an oncology nurse needed to insert two separate IVs for two different purposes — one to administer chemotherapy, say, and another hours later because the patient seemed dehydrated. Such cases were expected to be exceedingly rare.
But just as entrepreneurial corporate tax lawyers search each new tax code for economic advantage, entrepreneurial coders and billers find loopholes to exploit at the edge of the law. An investigation by the Health and Human Services Office of the Inspector General in 2005 found many instances of Modifier 59 abuse. Forty percent of code pairs billed with Modifier 59 in 2003 were not legitimate, resulting in $59 million in overpayment. Similarly, when Medicare announced that it would pay only a set fee for the first hour and a half of a chemotherapy infusion — and a bonus for time thereafter — a raft of infusions clocked in at 91 minutes.
Like nearly every area of medicine, coding science has advanced — though not to the patient’s benefit. Commercial computer “encoder” programs maximize income from coding and make helpful suggestions (“That could be billed for Level 3,” or “Did you forget Code 54150,” indicating a circumcision on a bill for a male newborn). Today many medical centers have coders specializing in particular disciplines — joint replacement or ophthalmology or interventional radiology, for example. Advanced coding consultants advise lesser coders. The Business of Spine, a Texas-based consulting firm with a partner office in Long Island, advises spine surgeons’ billers about what coding Medicare and commercial insurers will tolerate, what’s legal and not, to maximize revenue. The evolution of this mammoth growth enterprise means bigger bills for everyone — whether through increasing premiums and deductibles on insurance policies or, as in Wickizer’s situation, depleting the savings earmarked for children’s college.
Like many medical centers, the University of Virginia Health System has turned at least some of its billing and debt collection over to professionals, third-party contractors who have no pretense of the charitable mission espoused by the University of Virginia, founded by Thomas Jefferson in 1819 to educate leaders in public service. The collectors are often paid a percentage of the money they recover. They tend not to care whether a procedure was coded well or poorly. Their task is usually to go after the total sum the hospital says it is owed.
In Wickizer’s case, the hospital brought in a law firm that specialized in debt collection, then called Daniel & Hetzel and based in Winchester, Va. For a year and a half, Wickizer’s team of experts dissected the bills and negotiated with the hospital and its representatives at the law firm over its charges and coding strategies — just as insurers do behind the scenes on patients’ behalf. The experts laid out their logic for what might constitute reasonable payment in a detailed report based on what they could discover about Wickizer’s care: how it could be coded and what other hospitals and insurers would have paid. They helped her local lawyer, Kelly Roberts, write motions for discovery and legal letters and made offers of payment between $65,000 and $80,000, which they calculated should provide the hospital a profit on the services rendered to Wickizer.
But the hospital did not accept any of the offers. In a letter, Peter Hetzel, an attorney at the firm, said his client would accept only just over $225,000, saying the University of Virginia Medical Center was “the victim here.” He noted, too, that the small rental property that Wickizer owned — appraised at $90,200 in 2014 — was considered fair game for the hospital to seize as payment. Swensen, the spokesman for the university, said that it decides on a case-by-case basis whether or not to report nonpayment to credit agencies or to pursue civil cases against patients in court. He added: “If we obtain a lien on real estate, we do not seek to sell the property if it is the patient’s primary residence.”
In February 2016, Wickizer received a letter from the state of Virginia saying that the medical center would be dunning money from any tax refund she might get. At one point, in exasperation, Wickizer wrote to her group of experts: “More than likely I am going to have to declare bankruptcy by the time this is all said and done, and I just would like to have everything settled. I want to pay them what I have and what is fair.”
By then, Wickizer was recovering physically and had married her boyfriend. But she was still struggling with stress from the uncertainty of the mammoth bills hanging over her. With court dates scheduled and postponed, motions filed and denied, she and her pro bono lawyer from Chicago, Tom Osran, along with her local lawyer were finally scheduled to face off in court with the University of Virginia Medical Center on April 29, 2016. The day before trial, after Osran was preparing to book his plane ticket to Virginia, and after I called the hospital inquiring about attending the court session, the case was dismissed. The terms of the settlement are sealed.
Nearly a year later, Wickizer remains exhausted by the ordeal. Her speech, which was hesitant when I first spoke with her more than two years ago, sounds fluid now, and she is funny and thoughtful, though she says she still occasionally needs to search to find the right word, a form of a condition known as aphasia. Now working part-time as a clerk in a small store, she would like to go back to her previous work as a bookkeeper, she told me when we spoke in March. But she has failed to secure a job; she worries that her barely noticeable speech problems make her job interviews less than optimal. Or perhaps, she frets, the problem is her credit rating, which (unknown to her at the time) dropped more than 200 points after the doctors who cared for her reported her unpaid bills to credit agencies. That black mark will remain until 2021, even though her legal case is resolved and she now has military health insurance through her husband. And, she notes with a sigh of resignation, “I’m the kind of person who’s always tried to do everything right.”
The catastrophe struck Wanda Wickizer on Christmas Day 2013. A generally healthy, energetic 51-year-old, she suddenly found herself vomiting all day, racked with debilitating headaches. When her alarmed teenage son called an ambulance, the paramedics thought that she had food poisoning and didn’t take her to the emergency room. Later, when she became confused and groggy at 3 a.m., her boyfriend raced her to Sentara Norfolk General Hospital in coastal Virginia, where a scan showed she was suffering from a subarachnoid hemorrhage. A vessel had burst, and blood was leaking into the narrow space between the skull and the brain.
During a subarachnoid hemorrhage, if the pressure in the head isn’t relieved, blood accumulates in that narrow space and can push the brain down toward the neck. Vital nerves that control breathing and vision are compressed. Death is imminent. Wickizer was whisked by helicopter ambulance to the University of Virginia Medical Center in Charlottesville, 160 miles away, for an emergency procedure to halt the bleeding.
After spending days in a semi-comatose state, Wickizer slowly recovered and left the hospital three weeks after the hemorrhage, grateful to be alive. But soon after she returned home to her two teenage children, she found herself confronted with a different kind of catastrophe. Wickizer had had health insurance for most of her adult life: Her husband, who died in 2006, worked for the city of Norfolk, which insured their family while he was alive and for three years beyond. After his death, Wickizer worked in a series of low-wage jobs, but none provided health insurance. A minor pre-existing condition — she was taking Lexapro, a common medicine for depression — meant that her only insurance option was to be funneled into the “high-risk pool” (a type of costly insurance option that was essentially rendered obsolete by the Affordable Care Act and now figures in some of the G.O.P. plans to replace it). She would need to pay more than $800 per month for a policy with a $5,000 deductible, and her medical procedures would then be reimbursed at 80 percent. She felt she couldn’t afford that. In 2011, she decided to temporarily stop working to tend to her children, which qualified them for Medicaid; with trepidation, she left herself uninsured.
And so in early 2014, without an insurer or employer or government agency to run interference between her and the hospital, she began receiving bills: $16,000 from Sentara Norfolk (not including the scan or the E.R. doctor), $50,000 for the air ambulance. By the end of January, there was also one for $24,000 from the University of Virginia Physicians’ Group: charges for some of the doctors at the medical center. “I thought, O.K., that’s not so bad,” Wickizer recalls. A month later, a bill for $54,000 arrived from the same physicians’ group, which included further charges and late fees. Then a separate bill came just for the hospital’s charges, containing a demand for $356,884.42 but little in the way of comprehensible explanation.
In other countries, when patients recover from a terrifying brain bleed — or, for that matter, when they battle cancer, or heal from a serious accident, or face down any other life-threatening health condition — they are allowed to spend their days focusing on getting better. Only in America do medical treatment and recovery coexist with a peculiar national dread: the struggle to figure out from the mounting pile of bills what portion of the fantastical charges you actually must pay. It is the sickness that eventually afflicts most every American.
What’s less understood is the extent to which our current medical-billing system itself is responsible for the high prices patients are charged. There are, of course, many factors that have led to the United States’ record-breaking $3 trillion health care bill: runaway drug prices, excessive testing and sky-high charges for even the most basic medical interventions. But all of those individual price increases have been enabled — indeed, aided and abetted — by the complex system of billing and coding that underlies bills like those sent to Wickizer. That system, with its lines of alphanumeric codes and arcane medical abbreviations, has given birth to a gigantic new industry of consultants, armies of back-room experts whom medical providers and insurance companies deploy against each other in an endless war over which medical procedures were undertaken and how much to pay for them. Caught in the crossfire are Americans like Wanda Wickizer, left with huge bills and indecipherable explanations in languages they cannot possibly understand.
Disease-classification systems originated during an outbreak of the bubonic plague in 17th-century London — epidemiologic constructs to classify and track causes of death and prevent the spread of infections among populations that spoke different languages. In the 1890s, the French physician and statistician Jacques Bertillon further systematized death reporting by introducing the Bertillon Classification of Causes of Death, the first medical-coding system, which was adopted and modified in many countries. It became an official global effort, which was periodically revised by an international commission. During the first half of the 20th century, the number of entries naturally increased with improved understanding of science, and many countries began tabulating not just causes of deaths but also the incidence of diseases.
In the 1940s, the World Health Organization took over stewardship of Bertillon’s system and renamed it to reflect a new, broader focus: the International Statistical Classification of Diseases, Injuries and Causes of Death (ICD). The codes became an invaluable tool, a common language for epidemiologists and statisticians to track the world’s afflictions. But over the last several decades in the United States, codes gradually took on a bedrock financial function as the basis for medical billing. In 1979, the government decided to use what by then were called ICD-9 codes — which specify the patient’s diagnosis — in adjudicating Medicare and Medicaid claims, with some modifications added specifically for that purpose; the United States version was called ICD-9-CM. (The country has recently moved to a new iteration, ICD-10-CM.) For its beneficiaries, Medicare pays a fixed fee for inpatient hospitalization based primarily on the ICD-CM code, which is translated into a DRG (diagnosis-related group) code — which is the immediate basis for reimbursement.
Other insurers followed in making codes the basis for billing. Coding systems begot new coding systems, because few hospitals wanted to be paid according to Medicare’s relatively low DRG standards. And because strategic coding meant increased payment, that begot coding specialists and coding courses and coding degrees. There are now different increasingly complex coding languages that define payment for different kinds of services: CPT codes, for office visits delivered by doctors, as well as HCPCS, ICD-PCS-CM and DRG, for charges that are incurred in the hospital. There are tens of thousands of codes in each lexicon that have become increasingly specific. For example, there are different codes for in-office earwax removal depending on the method used (irrigation or instruments), different codes for delivering different vaccinations and a code for each injection delivered in the hospital. Different insurers also use different coding systems. While Medicare would have most likely considered Wickizer’s brain bleed as DRG 021, if billed to a commercial insurer, it could result in more than a dozen ICD codes and hundreds of HCPCS entries.
Seemingly subtle choices about which code to use can have large financial consequences. If after reviewing a hospital chart of, say, a patient who has just had a problem with his heart, a hospital coder indicates the diagnosis code for “heart failure” (ICD-9-CM Code 428) instead of the one for “acute systolic heart failure” (Code 428.21), the difference could mean thousands of dollars. “In order to code for the more lucrative code, you have to know how it is defined and make sure the care described in the chart meets the criterion, the definition, for that higher number,” says one experienced coder in Florida, who helped with Wickizer’s case and declined to be identified because she works for another major hospital. In order to code for “acute systolic heart failure,” the patient’s chart ought to include supporting documentation, for example, that the heart was pumping out less than 25 percent of its blood with each beat and that he was given an echocardiogram and a diuretic to lower blood pressure. Submitting a bill using the higher code without meeting criteria could constitute fraud.
Each billing decision, then, can be seen as a battle of coder versus coder. The coders who work for hospitals and doctors strive to bring in as much revenue as possible from each service, while coders employed by insurers try to deny claims as overreaching. Coders who audit Medicare charts look for abuse to reclaim money or fraud that needs to be punished with fines. Hospital coders teach doctors — and doctors pay to take courses — to learn how they can “upcode” their charts to a more lucrative level with minimal effort. In a doctor’s office, a Level 3 visit (paid, say, at $175) might be legally transformed into a Level 4 (say, $225) by performing one extra maneuver, like weighing the patient or listening to the lungs, whether the patient’s illness required that or not.
While most hospitals and insurers set their own rates for each level of care, adding a step when interacting with a patient can also bring windfalls. E.R. doctors, for example, learned that insurers might accept a higher-reimbursed code for the examination and treatment of a patient with a finger fracture (usually 99282) if — in addition to needed interventions — a narcotic painkiller was also prescribed (a plausible bump up to 99283), indicating a more serious condition.
Toward the end of the 20th century and into the next, as strategic coding increased, a new industry thrived. For-profit colleges offered medical-coding degrees, and internships soon followed. Because alphanumeric coding languages are as distinct from one another as Chinese is from Russian, different degree tracks are necessary, along with distinct professional organizations that offer their own particular professional exams, certifications and licensing. Hospital systems and insurers — which have become huge, Hydra-like enterprises — now all employ roomfuls of coding-program graduates to perform these tasks. Membership in the American Academy of Professional Coders has risen to more than 170,000 today from roughly 70,000 in 2008.
Individual doctors have complained bitterly about the increasing complexity of coding and the expensive necessity of hiring their own professional coders and billers — or paying a billing consultant. But they have received little support from the medical establishment, which has largely ignored the protests. And perhaps for good reason: The American Medical Association owns the copyright to CPT, the code used by doctors. It publishes coding books and dictionaries. It also creates new codes when doctors want to charge for a new procedure. It levies a licensing fee on billing companies for using CPT codes on bills. Royalties for CPT codes, along with revenues from other products, are the association’s biggest single source of income.
Patients with good health insurance are often blissfully unaware and mostly unaffected by the jockeying that goes on over how to code their bills. But uninsured patients like Wickizer, or (increasingly) those with high deductibles, are stuck with no insurer to argue on their behalf. Her experience with the University of Virginia Medical Center is not unique: Studies have shown that hospitals charge patients who are uninsured or self-pay 2.5 times more than they charge those covered by health insurance (who are billed negotiated rates) and three times more than the amount allowed by Medicare. That gap has grown considerably since the 1980s.
When Wickizer arrived home from the hospital in January 2014, she had trouble concentrating and finding words; she spoke deliberately, slowly. She remembers nothing before February, she says, but relied on help from her parents, who live nearby, and her boyfriend, who is retired from the Navy. She did her best to address the onslaught of bills that began appearing in her mailbox.
First, she took stock of her finances. She paid the rent for the Norfolk apartment that she and her children lived in by renting out a townhouse that she and her deceased husband had bought in Virginia Beach; after paying property tax, insurance and maintenance on the townhouse, she just broke even. She also received about $2,000 a month in Social Security survivor benefits because of her husband’s death. In addition, she had about $100,000 from her husband’s life insurance in a retirement account, which she was also hoping would help pay for her children’s college. With medical bills totaling nearly $500,000 and no health insurance, the numbers didn’t add up. “My dad said: ‘They’ll never expect you to pay that,’ ” Wickizer told me. “But they did.”
As a sign of good faith, she quickly paid $1,500 to the hospital and $1,000 to the doctors and sought to make sense of the bills. Patients today are told to be good medical consumers, but they are asked to write checks for thousands of dollars — in this case hundreds of thousands — with little explanation of what they’re for. Wickizer did what she would have done with a credit-card statement: She contacted the hospital and requested an itemized bill. Her idea was that if she could understand how much she was being charged for each procedure, she could compare the fees with the reimbursements that Medicare or another insurer would pay for those services and begin some kind of negotiation.
A month later, on March 19, the hospital finally sent a list of charges, using medical abbreviations and terminology but not revealing the all-important alphanumeric codes. Despite being 60 pages long, the tally seemed incomplete, leaving out doctor’s charges and including other fees that seemed incidental, like charges for catheters, wires and oxygen. Room charges were vastly different on different days.
Nearly simultaneously, she received a one-page bill for the hospital portion of her care, broken down only into the broadest categories, including $111,162 in room charges, $34,755.75 for pharmacy, $19,653 for labs, $8,640 for the operating room, $8,325 for anesthesia, $1,143 for the recovery room, $44,524 for medical supplies and $40,489 for radiology services, totaling $356,884.42. The bill informed her that the medical center was prepared to offer her its standard 20 percent discount for patients who are uninsured, leaving a “what you owe now” fee of $285,507.58. It noted that the hospital could offer some additional financial assistance, but only if her household of three had assets of less than $3,100 (“such as bank or retirement accounts”), which disqualified Wickizer and very likely most Americans who have ever held a job.
Next, she did her best to find out what Medicare or another insurer would have paid for her hospitalization, hoping to offer the hospital that amount from her retirement account. To understand the Medicare codes, she had to learn a bit of coding language. Would her hospitalization count as Medicare DRG 020 or 021? She estimated that in 2013, her subarachnoid hemorrhage (most likely coded, she determined, as “intracranial hemorrhage or cerebral infarction disorders, DRG 021, with procedures and major comorbidities or complications”), would have been reimbursed by Medicare for about $80,000. Had a member of the armed services experienced the same condition, Tricare, the military insurer, might have paid closer to $70,000. But to know how much a commercial insurer would have paid, she would have to figure out what HCPCS codes the hospital used to calculate her bill, and the hospital did not send those. Hospitals tend to treat their billing strategies — codes and their master price list, called a charge master — as trade secrets vital to their business. State laws and judges tend to respect that as proprietary information.
When the billers called insisting on payment of the full $285,507.58, Wickizer explained, “I don’t have this kind of money.” She offered the hospital and its doctors the $100,000 in her retirement account. They declined and suggested that she sign up for a payment plan of $5,000 a month to the hospital — and a second $5,000 plan for the physicians’ group. It was an untenable amount.
In October 2014, a sheriff affixed a summons to Wickizer’s front door, saying that the university was suing her for nonpayment. Eric Swensen, a spokesman for the University of Virginia, declined to answer questions about the case, citing patient privacy, as governed by HIPAA rules. But he noted that the university provides $270 million worth of free care to patients who meet its criterion for assistance and sets up interest-free payment plans for those who don’t.
After receiving the summons, Wickizer resorted to a technique followed by many a frustrated customer: She went on Facebook, posted her story and solicited advice. (The Facebook group Paying Till It Hurts, where she posted her story, was created in 2014 in connection with a New York Times series that I wrote with the same name.) A handful of experts — patient advocates, billing professionals, lawyers and a coder — volunteered their help pro bono to try to get more information from the medical center and translate the coding that yielded the unaffordable figure. (One notable aspect of our commercialized health system is that for every person who is pushing to profit, there is another who is doing his or her best to protect patients.)
In vetting Wickizer’s bill, the experts encountered roadblocks from the medical center at every turn in a contentious battle that lasted for over a year. Multiple legal requests to review Wickizer’s chart and complete bill — with its coding elucidated — were refused. Nora Johnson, a retired hospital bill-compliance auditor from West Virginia who volunteered to help Wickizer, noted that not revealing the billing codes constituted a violation of federal law. No insurer would have paid the bills without seeing them, allowing at least a rational attempt at negotiation. As Wickizer’s team wrote to the University of Virginia in one of their letters: “No Codes = No Pay.” The University of Virginia Physicians’ Group, which independently charged Wickizer $54,000, eventually turned over its billing codes. Wickizer’s experts were able to use the bill fragments they had received in discovery, supplemented by those codes, to get a better idea of what medical procedures Wickizer received during her three-week hospitalization. From there, they tried to extrapolate how the hospital had, perhaps, coded her case. By examining the cost reports the University of Virginia hospital must file with Medicare, which indicate the amount it spends delivering certain types of care, Christine Kraft, another medical-billing expert, estimated that even by its own calculations, the medical center spent less than $60,000 treating Wickizer.
The stealth battle between hospitals and insurers over bills for each hospitalization, office visit, test, piece of equipment and procedure is costly for us all. Twenty-five percent of United States hospital spending — the single most expensive sector in our health care system — is related to administrative costs, “including salaries for staff who handle coding and billing,” according to a study by the Commonwealth Fund. That compares with 16 percent in England and 12 percent in Canada.
That discrepancy comes, in part, from the prolonged negotiations over payment and the huge number of coders, billers and collectors who have to be compensated: Their salaries and loans from those years of training in obscure languages are folded into those high charges and rising premiums. In addition, as is often the case in warfare, the big conventional army can be at a disadvantage: The insurance companies and government seem to be always one step behind the latest guerrilla tactics of providers’ coders.
For years, creative coding has been winning over what the government calls “correct coding,” meaning coding that gives providers their due, but without exaggeration. Indeed, each attempt by the government to control questionable coding to enhance providers’ revenue has seemed to only fuel more attempts. In 1996, for example, Medicare’s National Correct Coding Initiative made it clear that certain codes couldn’t appear on the same bill because they were inherently part of the same procedure. As a rule, an anesthesiologist could not, for example, separately bill for anesthesia and checking your oxygen level during your surgery. But the government created Modifier 59 — a code that could be appended to other codes to allow doctors to take exceptions to that rule in unusual cases. Modifier 59 could be used to allow for two payments in certain situations, such as when an oncology nurse needed to insert two separate IVs for two different purposes — one to administer chemotherapy, say, and another hours later because the patient seemed dehydrated. Such cases were expected to be exceedingly rare.
But just as entrepreneurial corporate tax lawyers search each new tax code for economic advantage, entrepreneurial coders and billers find loopholes to exploit at the edge of the law. An investigation by the Health and Human Services Office of the Inspector General in 2005 found many instances of Modifier 59 abuse. Forty percent of code pairs billed with Modifier 59 in 2003 were not legitimate, resulting in $59 million in overpayment. Similarly, when Medicare announced that it would pay only a set fee for the first hour and a half of a chemotherapy infusion — and a bonus for time thereafter — a raft of infusions clocked in at 91 minutes.
Like nearly every area of medicine, coding science has advanced — though not to the patient’s benefit. Commercial computer “encoder” programs maximize income from coding and make helpful suggestions (“That could be billed for Level 3,” or “Did you forget Code 54150,” indicating a circumcision on a bill for a male newborn). Today many medical centers have coders specializing in particular disciplines — joint replacement or ophthalmology or interventional radiology, for example. Advanced coding consultants advise lesser coders. The Business of Spine, a Texas-based consulting firm with a partner office in Long Island, advises spine surgeons’ billers about what coding Medicare and commercial insurers will tolerate, what’s legal and not, to maximize revenue. The evolution of this mammoth growth enterprise means bigger bills for everyone — whether through increasing premiums and deductibles on insurance policies or, as in Wickizer’s situation, depleting the savings earmarked for children’s college.
Like many medical centers, the University of Virginia Health System has turned at least some of its billing and debt collection over to professionals, third-party contractors who have no pretense of the charitable mission espoused by the University of Virginia, founded by Thomas Jefferson in 1819 to educate leaders in public service. The collectors are often paid a percentage of the money they recover. They tend not to care whether a procedure was coded well or poorly. Their task is usually to go after the total sum the hospital says it is owed.
In Wickizer’s case, the hospital brought in a law firm that specialized in debt collection, then called Daniel & Hetzel and based in Winchester, Va. For a year and a half, Wickizer’s team of experts dissected the bills and negotiated with the hospital and its representatives at the law firm over its charges and coding strategies — just as insurers do behind the scenes on patients’ behalf. The experts laid out their logic for what might constitute reasonable payment in a detailed report based on what they could discover about Wickizer’s care: how it could be coded and what other hospitals and insurers would have paid. They helped her local lawyer, Kelly Roberts, write motions for discovery and legal letters and made offers of payment between $65,000 and $80,000, which they calculated should provide the hospital a profit on the services rendered to Wickizer.
But the hospital did not accept any of the offers. In a letter, Peter Hetzel, an attorney at the firm, said his client would accept only just over $225,000, saying the University of Virginia Medical Center was “the victim here.” He noted, too, that the small rental property that Wickizer owned — appraised at $90,200 in 2014 — was considered fair game for the hospital to seize as payment. Swensen, the spokesman for the university, said that it decides on a case-by-case basis whether or not to report nonpayment to credit agencies or to pursue civil cases against patients in court. He added: “If we obtain a lien on real estate, we do not seek to sell the property if it is the patient’s primary residence.”
In February 2016, Wickizer received a letter from the state of Virginia saying that the medical center would be dunning money from any tax refund she might get. At one point, in exasperation, Wickizer wrote to her group of experts: “More than likely I am going to have to declare bankruptcy by the time this is all said and done, and I just would like to have everything settled. I want to pay them what I have and what is fair.”
By then, Wickizer was recovering physically and had married her boyfriend. But she was still struggling with stress from the uncertainty of the mammoth bills hanging over her. With court dates scheduled and postponed, motions filed and denied, she and her pro bono lawyer from Chicago, Tom Osran, along with her local lawyer were finally scheduled to face off in court with the University of Virginia Medical Center on April 29, 2016. The day before trial, after Osran was preparing to book his plane ticket to Virginia, and after I called the hospital inquiring about attending the court session, the case was dismissed. The terms of the settlement are sealed.
Nearly a year later, Wickizer remains exhausted by the ordeal. Her speech, which was hesitant when I first spoke with her more than two years ago, sounds fluid now, and she is funny and thoughtful, though she says she still occasionally needs to search to find the right word, a form of a condition known as aphasia. Now working part-time as a clerk in a small store, she would like to go back to her previous work as a bookkeeper, she told me when we spoke in March. But she has failed to secure a job; she worries that her barely noticeable speech problems make her job interviews less than optimal. Or perhaps, she frets, the problem is her credit rating, which (unknown to her at the time) dropped more than 200 points after the doctors who cared for her reported her unpaid bills to credit agencies. That black mark will remain until 2021, even though her legal case is resolved and she now has military health insurance through her husband. And, she notes with a sigh of resignation, “I’m the kind of person who’s always tried to do everything right.”
Majority in U.S. Support Idea of Fed-Funded Healthcare System
by Ralph Nader - Common Dreams - March 29, 2017
You can thank House Speaker Ryan and President Trump for pushing their cruel health insurance boondoggle. This debacle has created a big opening to put Single Payer or full Medicare for all prominently front and center. Single Payer means everybody in, nobody out, with free choice of physician and hospital.
The Single Payer system that has been in place in Canada for Decades comes in at half the cost per capita, compared to what the U.S. spends now. All Canadians are covered at a cost of about $4500 per capita while in the U.S. the cost is over $9000 per capita, with nearly 30 million people without coverage and many millions more underinsured.
"Time to call your Senators and Representatives."
Seventy-three members of the House of Representatives have co-signed Congressman Conyers’s bill, HR 676, which is similar to the Canadian system. These lawmakers like HR 676 because it has no copays, nasty deductibles or massive inscrutable computerized billing fraud, while giving people free choice and far lower administrative costs.
Often Canadians never even see a bill for major operations or procedures. Dr. Stephanie Wohlander, who has taught at Harvard Medical School, estimated recently that a Single Payer system in the U.S. would potentially save as much as $500 billion, just in administrative costs, out of the nearly $3.5 trillion in health care expenditures this year.
Already federal, state and local governments pay for about half of this gigantic sum through Medicare, Medicaid, the Pentagon, VA, and insuring their public employees. But the system is complexly corrupted by the greed, oft-documented waste, and over-selling of the immensely-profitable, bureaucratic insurance and drug industry.
To those self-described conservatives out there, consider that major conservative philosophers such as Friedrich Hayek, a leader of the Austrian School of Economics, so revered by Ron Paul, supported “a comprehensive system of social insurance” to protect the people from “the common hazards of life,” including illness. He wanted a publically funded system for everyone, not just Medicare and Medicaid patients, with a private delivery of medical/health services. That is what HR 676 would establish (ask your member of Congress for a copy or find the full text here. (Conservatives may wish to read for greater elaboration of this conservative basis, my book, Unstoppable: The Emerging Left-Right Alliance to Dismantle the Corporate State.)
Maybe some of this conservative tradition is beginning to seep into the minds of the corporatist editorial writers of the Wall Street Journal. Seeing the writing on the wall, so to speak, a recent editorial, before the Ryan/Trump crash, concluded with these remarkable words:
“The Healthcare Market is at a crossroads. Either it heads in a more market-based direction step by step or it moves toward single payer step by step. If Republicans blow this chance and default to Democrats, they might as well endorse single-payer because that is where the politics will end up.”
Hooray!
Maybe such commentary, repeated by another of the Journal’s columnists, will prod more Democrats to come out of the closet and openly push for a Single Payer system. At a recent lively town meeting in San Francisco, Minority Leader Nancy Pelosi blurted at her younger protesters: “I’ve been for single-payer before you were born.”
Presumably retired President Barack Obama and Hillary Clinton will do the same, since they too were for “Full Medicare for All” before they became politically subservient to corporate politics.
Even without any media, and any major party calling for it, a Pew poll had 59% of the public for Full Medicare for All, including 30% of Republicans, 60% of independents and 80% of Democrats. Ever since President Harry S. Truman proposed to Congress universal health insurance legislation in the nineteen forties, public opinion, left and right, has been supportive.
We’ve compiled twenty-one ways in which life is better in Canada than in the U.S. because of the Single Payer health insurance system. Canadians, for example, don’t have to worry about pay or die prices, don’t take or decline jobs based on health insurance considerations, nor are they driven into bankruptcy or deep debt, they experience no anxiety over being denied payment or struck with reams of confusing, trap-door computerized bills and fine print.
People in Canada do not die (estimated at 35,000 fatalities a year in the U.S.) because they cannot go for diagnoses or treatment in time.
Canadians can choose their doctors and hospitals without being trapped, like many in the U.S., into small, narrow service networks.
In Canada the administration of the system is simple. You get a health care card when you are born. You swipe it when you visit a physician or hospital.
All universal health insurance systems in all western countries have their problems; but Americans are extraordinarily jammed with worry, anxiety and fear over how or if their care is going to be covered or paid, not to mention all the perverse incentives for waste, gouging and profiteering.
Time to call your Senators and Representatives. There are only 535 of them and you count in the tens of millions!
For the full 21 Ways, see the article here.
For more information on health care in the U.S., what’s being done to combat vicious commercial assaults on our country’s most vulnerable people, and to find out how you can help fight back, visit http://www.singlepayeraction.org/.
21 Ways the Canadian Health Care System is Better than Obamacare
by Ralph Nader - November 21, 2013
Dear America:
Costly complexity is baked into Obamacare. No health insurance system is without problems but Canadian style single-payer full Medicare for all is simple, affordable, comprehensive and universal.
In the early 1960s, President Lyndon Johnson enrolled 20 million elderly Americans into Medicare in six months. There were no websites. They did it with index cards!
Below please find 21 Ways the Canadian Health Care System is Better than Obamacare.
Repeal Obamacare and replace it with the much more efficient single-payer, everybody in, nobody out, free choice of doctor and hospital.
Love, Canada
Number 21:
In Canada, everyone is covered automatically at birth – everybody in, nobody out.
In Canada, everyone is covered automatically at birth – everybody in, nobody out.
In the United States, under Obamacare, 31 million Americans will still be uninsured by 2023 and millions more will remain underinsured.
Number 20:
In Canada, the health system is designed to put people, not profits, first.
In Canada, the health system is designed to put people, not profits, first.
In the United States, Obamacare will do little to curb insurance industry profits and will actually enhance insurance industry profits.
Number 19:
In Canada, coverage is not tied to a job or dependent on your income – rich and poor are in the same system, the best guaranty of quality.
In Canada, coverage is not tied to a job or dependent on your income – rich and poor are in the same system, the best guaranty of quality.
In the United States, under Obamacare, much still depends on your job or income. Lose your job or lose your income, and you might lose your existing health insurance or have to settle for lesser coverage.
Number 18:
In Canada, health care coverage stays with you for your entire life.
In Canada, health care coverage stays with you for your entire life.
In the United States, under Obamacare, for tens of millions of Americans, health care coverage stays with you for as long as you can afford your share.
Number 17:
In Canada, you can freely choose your doctors and hospitals and keep them. There are no lists of “in-network” vendors and no extra hidden charges for going “out of network.”
In Canada, you can freely choose your doctors and hospitals and keep them. There are no lists of “in-network” vendors and no extra hidden charges for going “out of network.”
In the United States, under Obamacare, the in-network list of places where you can get treated is shrinking – thus restricting freedom of choice – and if you want to go out of network, you pay for it.
Number 16:
In Canada, the health care system is funded by income, sales and corporate taxes that, combined, are much lower than what Americans pay in premiums.
In Canada, the health care system is funded by income, sales and corporate taxes that, combined, are much lower than what Americans pay in premiums.
In the United States, under Obamacare, for thousands of Americans, it’s pay or die – if you can’t pay, you die. That’s why many thousands will still die every year under Obamacare from lack of health insurance to get diagnosed and treated in time.
Number 15:
In Canada, there are no complex hospital or doctor bills. In fact, usually you don’t even see a bill.
In Canada, there are no complex hospital or doctor bills. In fact, usually you don’t even see a bill.
In the United States, under Obamacare, hospital and doctor bills will still be terribly complex, making it impossible to discover the many costly overcharges.
Number 14:
In Canada, costs are controlled. Canada pays 10 percent of its GDP for its health care system, covering everyone.
In Canada, costs are controlled. Canada pays 10 percent of its GDP for its health care system, covering everyone.
In the United States, under Obamacare, costs continue to skyrocket. The U.S. currently pays 18 percent of its GDP and still doesn’t cover tens of millions of people.
Number 13:
In Canada, it is unheard of for anyone to go bankrupt due to health care costs.
In Canada, it is unheard of for anyone to go bankrupt due to health care costs.
In the United States, under Obamacare, health care driven bankruptcy will continue to plague Americans.
Number 12:
In Canada, simplicity leads to major savings in administrative costs and overhead.
In Canada, simplicity leads to major savings in administrative costs and overhead.
In the United States, under Obamacare, complexity will lead to ratcheting up administrative costs and overhead.
Number 11:
In Canada, when you go to a doctor or hospital the first thing they ask you is: “What’s wrong?”
In Canada, when you go to a doctor or hospital the first thing they ask you is: “What’s wrong?”
In the United States, the first thing they ask you is: “What kind of insurance do you have?”
Number 10:
In Canada, the government negotiates drug prices so they are more affordable.
In Canada, the government negotiates drug prices so they are more affordable.
In the United States, under Obamacare, Congress made it specifically illegal for the government to negotiate drug prices for volume purchases, so they remain unaffordable.
Number 9:
In Canada, the government health care funds are not profitably diverted to the top one percent.
In Canada, the government health care funds are not profitably diverted to the top one percent.
In the United States, under Obamacare, health care funds will continue to flow to the top. In 2012, CEOs at six of the largest insurance companies in the U.S. received a total of $83.3 million in pay, plus benefits.
Number 8:
In Canada, there are no necessary co-pays or deductibles.
In Canada, there are no necessary co-pays or deductibles.
In the United States, under Obamacare, the deductibles and co-pays will continue to be unaffordable for many millions of Americans.
Number 7:
In Canada, the health care system contributes to social solidarity and national pride.
In Canada, the health care system contributes to social solidarity and national pride.
In the United States, Obamacare is divisive, with rich and poor in different systems and tens of millions left out or with sorely limited benefits.
Number 6:
In Canada, delays in health care are not due to the cost of insurance.
In Canada, delays in health care are not due to the cost of insurance.
In the United States, under Obamacare, patients without health insurance or who are underinsured will continue to delay or forgo care and put their lives at risk.
Number 5:
In Canada, nobody dies due to lack of health insurance.
In Canada, nobody dies due to lack of health insurance.
In the United States, under Obamacare, many thousands will continue to die every year due to lack of health insurance.
Number 4:
In Canada, an increasing majority supports their health care system, which costs half as much, per person, as in the United States. And in Canada, everyone is covered.
In Canada, an increasing majority supports their health care system, which costs half as much, per person, as in the United States. And in Canada, everyone is covered.
In the United States, a majority – many for different reasons – oppose Obamacare.
Number 3:
In Canada, the tax payments to fund the health care system are progressive – the lowest 20 percent pays 6 percent of income into the system while the highest 20 percent pays 8 percent.
In Canada, the tax payments to fund the health care system are progressive – the lowest 20 percent pays 6 percent of income into the system while the highest 20 percent pays 8 percent.
In the United States, under Obamacare, the poor pay a larger share of their income for health care than the affluent.
Number 2:
In Canada, the administration of the system is simple. You get a health care card when you are born. And you swipe it when you go to a doctor or hospital. End of story.
In Canada, the administration of the system is simple. You get a health care card when you are born. And you swipe it when you go to a doctor or hospital. End of story.
In the United States, Obamacare’s 2,500 pages plus regulations (the Canadian Medicare Bill was 13 pages) is so complex that then Speaker of the House Nancy Pelosi said before passage “we have to pass the bill so that you can find out what is in it.”
Number 1:
In Canada, the majority of citizens love their health care system.
In Canada, the majority of citizens love their health care system.
In the United States, the majority of citizens, physicians, and nurses prefer the Canadian type system – single-payer, free choice of doctor and hospital , everybody in, nobody out.
How Trumpcare’s Failure Sets the Stage for Single-Payer
With the implosion of "repeal and replace," the next logical step in Democratic health care reform is Medicare for All.
by Sarah Jones - The New Republic - March 28, 2017
Trumpcare is dead. President Donald Trump is humiliated and so is House Speaker Paul Ryan. The Democrats can hardly believe their luck: The Republicans have hobbled their own agenda, while Obamacare, aka the Affordable Care Act, lives to fight another day. But unlike the law’s previous brushes with death—most notably its bruising encounters with the Supreme Court in 2012 and 2015—this latest example of its resilience represents a turning point, if Democrats choose to seize the opportunity. For three reasons—political, structural, and moral—now is the time for the Democratic Party to begin building a proposal for a single-payer health care system.
Politically, the momentum clearly points left. Long derided by conservatives and centrists as socialist fantasy, single-payer health care (sometimes called Medicare for All) is having a moment. In January, 60 percent of Americans told Pew Research Center they believe the government has a “responsibility” to ensure health care access. That figure tracks with a 2015 Kaiser Health poll, which revealed that 58 percent of voters supported some version of Medicare for All. Democratic Socialists of America have experienced significant membership growth since Trump’s election, and its activists are canvassing for single-payer in New York and California. California gubernatorial candidate Gavin Newsom just added a version of the policy to his campaign platform. And Senator Bernie Sanders reigns as the country’s most popular politician—and he ran in the Democratic primary on a platform that included Medicare for All.
For long-time advocates of single-payer, this is all rare good news. Dr. Steffie Woolhandler, a co-founder of Physicians for a National Health Program, expressed tentative optimism in an interview with the New Republic. “We’ve been getting a lot of requests from professional journals and physicians and professional organizations to speak on the issue of single payer,” she said. “As someone who’s been doing this a long time, I’m seeing a lot of interest about single payer.”
There’s evidence that this is more than an anecdotal observation. Nobody except the White House and the insurance industry wanted Trumpcare. The bill, otherwise known as the American Health Care Act, would have in many ways returned the health care system to the pre-Obamacare status quo. By upending Medicaid and repealing the individual mandate, it would have taken insurance away from tens of millions of people and made it more expensive for the poor, the elderly, and the sick. A Quinnipiac University poll found that 56 percent of Americans opposed the bill, while a mere 17 percent supported it. Not even a majority of Republican voters supported the bill. Critics of the AHCA were outspoken: They swamped congressional offices with phone calls, an outgrowth of earlier town hall disruptions. Trump’s approval ratings sank to a miserable 37 percent.
Trumpcare failed for numerous reasons, starting with the incompetence of President Trump himself and the dysfunction of the Republican Party. But the defeat of Trumpcare points to a deeper, simpler politics surrounding health care. Most voters have no opinion on the efficacy of high-risk pools. They think in expansive terms: They want health care, and they want more of it, not less. Trumpcare threatened that basic interest. If Democrats are to capitalize on this moment, they can’t satisfy themselves with merely preserving Obamacare. The failure of Trumpcare proved that Obamacare is a floor, not a ceiling; in fact, Trump himself helped establish that floor by duping his supporters into believing that “everybody” would be covered under a Republican health care plan. What voters want is better, more generous care, and the smart response is to give it to them.
Is single-payer the policy answer to more and better coverage? Calls for single-payer invariably provoke concern over its practicality and expense, and it is true that single-payer proposals have to account for a drastic transition process. According to the University of Chicago’s Dr. Harold Pollack, there’s no doubt that “a well-functioning single-payer system would work better than the current American health system.” But he said advocates must account for the dysfunctional system they’ve inherited.
“The challenge that I have is that people often talk about single-payer as an alternative to the pathological political economy that drives American health care and American health politics,” he told the New Republic. “And a single-payer system would have to be a product of that exact same troubled political economy, and would have to bake in many of the defects that we have in our current system in order to come about.”
This dynamic is partially why then-President Barack Obama had to fight conservatives in his own party to pass the incremental reforms offered by the ACA. Obama himself became more conservative on the issue: Though he once supported what he called “a single-payer universal health care program,” he came to believe that single-payer would be “too disruptive” for the health care industry.
But this triangulation leaves us a patchwork system for a universal problem. Most Americans still get health insurance from their employers, but this coverage can still be expensive. Qualify for Medicaid, and you have to hope the government will provide the medications your doctor says you need. Qualify for Medicare, and you may still need to purchase supplemental Medicare plans to cover your expenses. If you qualify for neither, and don’t have insurance from an employer, then the ACA’s exchanges are your only option. But if you can’t afford the premium, you’ll have to pay a fine.
The system’s deficiencies are well-known. For one, this thin safety net doesn’t actually save the country any money. The World Bank reports that, in 2014, America spent more on health care as a total share of its GDP than any other nation save for the Marshall Islands. Our health care system is also one of the most inefficient on the planet: Bloomberg reported last September that America ranks 50th out of 55 nations its health care efficiency index. The question is not if the ACA and Medicare and Medicaid are inadequate. This is self-evidently true.
What is new is that Trumpcare’s failure proved, in the most emphatic way possible, that you can’t go further right than the Affordable Care Act without starting to drop people en masse from health insurance coverage. As David Leonhardt pointed out in the New York Times, Democrats have moved right on the issue for decades, culminating in the ACA—if you want to improve health care in this country, there is nowhere else to go but left. That is why the call from centrist liberals for more “market-based” health care reform makes little sense. People object to the status quo; they will not be content with its maintenance.
Pollack, who supports an incrementalist approach to reform, urged single-payer supporters to focus on defending the ACA’s Medicaid expansion and to demand a public option in the Obamacare exchanges, which would theoretically bring down the costs of health care plans in the individual market.
Woolhandler, meanwhile, says the answer is an improved and expanded version of Medicare. “Make the coverage cover all medically necessary services without copayments and deductibles and proscribe the participation of private health insurance industry in the Medicare program,” she suggested. The result, she argued, would be less expensive than America’s current system. Vijay Das, a strategist for the think tank Demos, suggested a similar strategy, with a particular focus on state-based policies. “I think expanding Medicare to children is a safe way of expanding the risk pool, getting healthy people into the system and lowering costs,” he explained.
All these proposals, in their own ways, logically lead toward single-payer. But they face numerous political obstacles, and Das says the Democratic Party is one of them. “It’s partly because the party that used to be the proponent of single-payer has been largely captured by the interests who think single-payer will destroy their profits,” he explained. “For me, it’s a money in politics issue, not as much as a mobilization issue.” As Lee Fang reported for The Intercept last year, Democratic consultants helped raise $1 million to defeat a single-payer proposal in Colorado. The same consultants had links to the Obama administration and the Clinton campaign.
Health care reform is a problem with a dual nature. It’s a matter of policy, yes, but of morality too, and there is an unassailable moral logic for single-payer. Opponents of single-payer must reckon with it, just as they ask advocates to reckon with political practicalities. Advocates must repeatedly ask: Is the status quo tolerable? “Even with the ACA’s advances,” Das said, “it’s really, really difficult to tell somebody who is in and out of work, is working class, and doesn’t qualify for Medicaid, that their $465 a month-even-with-subsidies-premium is something they should be happy about.”
There is a body count attached to every delay and half-measure. On February 17, Amy Schnelle suffered a seizure and died. She was 31 years old, reported WATE 6 of Knoxville, Tennessee, and unable to work due to the severity of her epilepsy. Medicaid covered her treatment and she lived relatively seizure-free—until September 2016, when Medicaid cut off one of her prescriptions. “I couldn’t imagine what would happen if I’m off of my medicine for a week,” she told the news station at the time. “I could roll into seizures.” She appealed the decision, but no luck. Medicaid’s decision can’t be attributed to Donald Trump, either. It occurred under the Obama administration.
Schnelle slipped through the system’s spiderweb cracks. She was lucky to even qualify for Medicaid: States aren’t required to expand it, and the ACA’s subsidies often aren’t generous enough to make up the difference for people who can’t use it. These cracks are numerous enough, and create a void wide enough, that crowd-funding campaigns proliferate as an alternative. In 2015, the Los Angeles Times reported an “uptick” in the use of websites like GoFundMe, Indiegogo, and YouCaring for health care needs. These campaigns bare the desperation of those in need—and the catastrophic consequences of their inadequacies. After relocating to care for his dying mother, Shane Boyle, a type-1 diabetic, started a GoFundMe campaign to cover a month’s worth of insulin due to a gap in his insurance coverage. His mother died on March 11. Boyle died of diabetic complications one week later, without meeting his fundraising goal. His family has started a new GoFundMe to pay for his funeral.
The moral case for universal health care is too often obscured by red-baiting. But once you accept that everyone should be covered, and establish that the expansion of government programs is the only viable path to achieving that goal, that case is difficult to ignore. Trumpcare’s defeat offers Democrats a chance to move from a defensive crouch to a positive vision that affirms the moral significance of health care as a human right. The market can’t compensate for the system’s deficiencies. In fact, the market is precisely what restricts the ACA’s salvific properties, and that has deadly consequences for the sick. How many Shane Boyles must we accept in deference to it?
The seed is there if Democrats are willing to water it. The Washington Post’s Dave Weigel reported Sunday that Rep. Jim Langevin (D-RI) and House Minority Leader Nancy Pelosi (D-CA) recently told constituents they are either interested in or expressly support single-payer health care. Rep. Keith Ellison (D-MN) is on record supporting Medicare for All, and Sen. Elizabeth Warren (D-MA) also indicated she supports some version of a single-payer system.
They’ll have a test soon: Sanders has announced that he will re-introduce his Medicare for All bill, and a similar measure in the House has 72 co-sponsors. Neither will pass in a Republican Congress, but that’s not really the point. As Ryan Cooper recently argued in The Week, popular support for Medicare means that Medicare for All proposals are “an excellent organizing signpost.” The concept obviously appeals to the party’s base—and could be marketed in a way that appeals to low-income Republicans at odds with the GOP’s austerity.
The Democrats spent years preparing themselves for Obamacare. Now is the time to do the same for single-payer. Now is the time to organize and to develop evidence-based policies they can actually implement when they’re back in power. The transition will cause disruption, but it can and should be managed. The alternative is intolerable. “We need health care,” a West Virginia coal miner told Sanders during an MSNBC town hall earlier this month. “Everybody in this room needs free health care.” He gets it. Sanders gets it. It’s time everyone else did, too.
Sarah Jones is the social media editor at The New Republic.
Sarah Jones is the social media editor at The New Republic.
Bernie Sanders to introduce single-payer health care bill in U.S. Senate
By Peter Hirschfeld
VPR (Vermont Public Radio), March 25, 2017
VPR (Vermont Public Radio), March 25, 2017
Less than 24 hours after the disintegration of a Republican effort to repeal and replace the federal Affordable Care Act, Sen. Bernie Sanders told constituents at a town hall meeting in Hardwick Saturday that he’ll introduce a single-payer health care bill in Congress “within a couple of weeks.”
The announcement drew thunderous applause from the approximately 1,000 people in the Hazen Union High School gymnasium, where Sanders shared a stage with Sen. Patrick Leahy and Rep. Peter Welch.
Sanders told the audience that the defeat of the Republican health care bill demonstrates widespread dissatisfaction among Americans with GOP health care policies. And he says he thinks his “Medicare for all” bill will have strong appeal even among the red-state voters that put President Donald Trump in the White House.
Sanders has introduced similar legislation before.
“It is a common sense proposal, and I think once the American people understand it, we can go forward with it,” Sanders said after the town hall meeting.
Welch said that once Sanders’ bill is introduced in the Senate, he’ll introduce the same bill in the U.S. House of Representatives. Welch told the audience that passage of the Affordable Care Act in 2010 was an important step forward.
After the town hall, Welch said he’s realistic about the legislation’s prospects.
“Well, you know, it’s a goal. In this Congress, we won’t pass it,” Welch said. “But I think we have to do keep the goal out there, because we need in this country, like any industrialized country, a health care system that’s affordable, accessible and universal.”
In the wake of the GOP’s failure to repeal the ACA, Welch says he also plans to “reach out to [his] Republican colleagues with specific proposals about some of the things we can do to fix some of the issues in the Affordable Care Act.”
Welch says the individual market, which affects about 6 percent of Americans, “is a problem right now,” and that he’s ready to work across the aisle to find ways to fix it.
Welch says he’s also eager to work with Trump to allow the federal government to negotiate prices with pharmaceutical companies, a move Welch says could save $167 billion annually.
“So my view is that those of us on the Democratic side who did support the ACA have to reach out to our Republican colleagues and offer to work with them on improvements,” Welch said.
Repeal of Affordable Care Act Is Back on Agenda, Republicans Say
by Robert Pear and Jeremy Peters - NYT - March 28, 2017
WASHINGTON — Under extreme pressure from conservative activists, House Republican leaders and the White House have restarted negotiations on legislation to repeal the Affordable Care Act.
But efforts to revive the legislation in the House could take weeks, lawmakers conceded, as Congress moves forward with a full plate of other time-consuming issues. And the renewed push did not meet with much enthusiasm from Senate Republicans, who said they had other priorities at the moment.
Nonetheless, Speaker Paul D. Ryan vowed to renew efforts to repeal the law, despite last’s week crushing setback when House Republicans tossed aside a repeal bill because they lacked the votes to pass it.
Just days after President Trump said he was moving on to other issues, senior administration officials said they still hoped to score the kind of big legislative victory that has so far eluded the White House. Vice President Mike Pence was dispatched to Capitol Hill on Tuesday for lunchtime talks.
“We’re not going to retrench into our corners or put up dividing lines,” Mr. Ryan said after a meeting of House Republicans was dominated by talk of how to restart health negotiations. “There’s too much at stake to get bogged down in all that,” he added.
Democrats had celebrated what they thought was the demise of the repeal bill on Friday. But the House Republican whip, Steve Scalise of Louisiana, said on Tuesday, “Their celebration is premature.”
“I think we’re closer today to repealing Obamacare than we’ve ever been before, and surely even closer than we were Friday,” Mr. Scalise said.
It is not clear what political dynamics might have changed since Friday, when a coalition of hard-line conservatives and more moderate Republicans torpedoed legislation to repeal President Barack Obama’s signature domestic achievement.
“I don’t know what has changed,’’ said Representative Jim McGovern, Democrat of Massachusetts. “The bill went down because it was too bad for Republican moderates and not bad enough for their conservatives. I don’t know how they reconcile the divides within their own conference, never mind find any Democratic votes.”
The Republicans’ repeal bill, according to the Congressional Budget Office, would have left an additional 24 million Americans without insurance by 2026, a major worry for moderate Republicans. It would also have left in place regulations on the health insurance industry that are anathema to conservatives.
Mr. Ryan declined to say what might be in the next version of the Republicans’ repeal bill, nor would he sketch any schedule for action. But he said Congress needed to act because insurers were developing premiums and benefit packages for health plans to offer in 2018, with review by federal and state officials beginning soon.
The new talks, which quietly began this week, involve Stephen K. Bannon, the president’s chief strategist, and members of two Republican factions that helped sink the bill last week, the hard-right Freedom Caucus and the more centrist Tuesday Group.
Any deal would have to overcome significant differences about how to rework a law that affects about one-fifth of the American economy. Those differences were so sharp that they led Mr. Trump and Mr. Ryan to pull the bill just before the House was to vote on it.
Still, Republican members of Congress said they were hopeful.
“I think everyone wants to get to yes and support President Trump,” said Representative Dave Brat of Virginia, a Freedom Caucus member. “There is a package in there that is a win-win.”
Representative Raúl R. Labrador of Idaho, also a Freedom Caucus member, said he hoped the discussions would yield a compromise after a divisive debate that revealed deep fissures within the party. “I think we will have a better, stronger product that will unify the conference,” Mr. Labrador said.
Mr. Trump has sent mixed signals in recent days, at times blaming the Freedom Caucus, outside groups and even, it appeared, Mr. Ryan for the health bill’s failure. On Monday, for instance, he said in a late-night Twitter post that the Freedom Caucus was able to “snatch defeat from the jaws of victory.”
But then Mr. Trump suggested that he could also cut a deal with Democrats, a move that would almost certainly make more conservative members of the House balk. “Do not worry,” he said on Twitter, “we are in very good shape!”
At a White House reception for senators on Tuesday night, Mr. Trump called for Republicans and Democrats to work together as he predicted that “we are all going to make a deal on health care.”
“That’s such an easy one,” Mr. Trump said. “I have no doubt that that’s going to happen very quickly.”
Lawmakers who attended the meeting of House Republicans on Tuesday said it was a lively exchange at which members of the Freedom Caucus were put on the defensive.
“There were a lot of unhappy people who got to vent, got to share their frustration,” said Representative Randy Weber of Texas, a member of the Freedom Caucus. “People said the Freedom Caucus owes us an explanation.”
In the Senate, the majority leader, Mitch McConnell of Kentucky, an inveterate foe of the 2010 health care law, said, “Where we are on Obamacare, regretfully, at the moment is where the Democrats wanted us to be, which is with the status quo.”
Democrats “ought to be pretty happy about that, because we have the existing law in place, and I think we’re just going to have to see how that works out,” Mr. McConnell said. “We believe it will not work out well, but we’ll see.”
Senator John Thune of South Dakota, the No. 3 Senate Republican, said he believed the House would take up another repeal bill. “It’s not a question of if, it’s a question of when,’’ he said.
Senator John McCain, Republican of Arizona, said: “Obamacare is imploding in my state. Something has to be done.” Asked if he could vote for a bill that did not include a full repeal of the Affordable Care Act, Mr. McCain said, “I would be willing to examine all options to protect the citizens of my state.”
Mr. Ryan said he hoped to foster a consensus through conversations like the one House Republicans had on Tuesday. “I don’t want us to become a factionalized majority,” he said. “I want us to become a unified majority, and that means we’re going to sit down and talk things out until we get there, and that’s exactly what we’re doing.”
Seizing a possible opportunity, the House Democratic leader, Nancy Pelosi of California, asked members of her caucus to suggest ways of improving the Affordable Care Act.
Blocking the repeal bill was a “thrilling success,” she said in a letter to House Democrats. She asked them to suggest ways to “improve and update” the law, which she pushed through the House in 2010 without any Republican votes.
Suggestions, she said, could be used in discussions with other members of Congress and “perhaps even with the president.”
Severe Eczema Drug Is Approved by F.D.A.; Price Tag Is $37,000 a Year
by Katie Thomas - NYT - March 26, 2017
The Food and Drug Administration on Tuesday approved a drug to treat people with a serious form of eczema, a potential breakthrough for people who have suffered for years without relief. But it will not come cheap.
The drug, to be called Dupixent, will carry a list price of $37,000 a year, a hefty price tag for patients who are increasingly being asked to pay a larger share of the drugs they take. Still, its price is a bit lower than many other commonly used biologic drugs, such as Humira and Enbrel, that treat other skin diseases.
In an effort to head off another public battle over the soaring cost of some prescriptions, the drug makers Regeneron Pharmaceuticals and Sanofi took the unusual step of directly negotiating with insurers over the price and other details ahead of time. What consumers pay for drugs has come under heightened scrutiny in the last few years, most recently by President Trump, who has promised several times to take drug companies to task over their costly products.
“Things have really deteriorated in our industry,” said Dr. Leonard S. Schleifer, the chief executive of Regeneron. “There’s so much concern over drug pricing that there’s an enormous amount of finger-pointing that is going on that’s counterproductive. It isn’t necessarily incentivizing the right behavior.”
The best-selling products Humira and Enbrel, which treat the skin disease psoriasisand other conditions, carry annual list prices of about $50,000.
Although many patients with insurance will not be asked to pay the full $37,000, consumers have been more exposed to rising prices in recent years because insurers often require them to pay a percentage of a drug’s list price — sometimes up to half — or pay the full price until their deductible is met.
They also often must demonstrate that other, cheaper drugs did not work before an insurer will cover more expensive drugs. Regeneron has said it also negotiated a more streamlined approval process, although patients will still have to try other drugs first. It also said it had a patient assistance program to help people who have troubling paying.
Regeneron and Sanofi held much of the bargaining power in negotiating Dupixent’s price because it has been shown to work well and has no real competition, said Dr. Steve Miller, the chief medical officer at Express Scripts, the nation’s largest pharmacy benefit manager, which often negotiates with drug makers on behalf of clients like insurers and large employers.
With breakthrough treatments, “companies can really go to the high end of that demand for reimbursement,” Dr. Miller said, “and all we have is the bully pulpit to complain about it.”
In trying to reach an agreement before approval, Dr. Miller said, “this is how the system is supposed to work.”
Christine Cramer, a spokeswoman for CVS Health, another leading pharmacy benefit manager, said, “While we believe our advocacy on behalf of our clients did ultimately influence Regeneron’s initial pricing strategy, the drug will be expensive.”
But Peter Maybarduk, director of the Access to Medicines program at Public Citizen, a consumer group, noted that negotiations still took place out of the public eye and within the context of a system that is inherently unfair. “It’s the arrangement that corporations found beneficial in a system that provides monopolies and rewards secrecy, and we should ask for considerably more as the standard,” he said.
Dupixent treats severe to moderate atopic dermatitis, a common form of eczema that goes beyond the occasional bouts of itchy, dry skin that many people get. For people with serious forms of the disease, other treatments often do little to calm their skin, leading to sleeplessness, depression and social anxiety. Regeneron said Tuesday that an estimated 300,000 people in the United States could qualify for its drug.
“I always say that atopic dermatitis doesn’t kill you, it just ruins your life,” said Dr. Elaine Siegfried, a professor of pediatrics and dermatology at the St. Louis University School of Medicine. She was not involved in the clinical trials that led to approval, but she said she was likely to enroll patients in pediatric studies that are getting underway. Dupixent, she said, appears to work well, with few serious side effects. “It is groundbreaking,” she said.
Debbie Byrnes, a sixth-grade teacher from San Antonio who participated in the clinical trial, had suffered for years with severe eczema that often covered her face. “That was the really difficult thing for me — I could never hide it,” she said. “I would have days when I went into school, and the kids would look at me and say, ‘What happened to you?’ ”
Ms. Byrnes said she began noticing a difference about five days after her first dose and has now been using the drug for two years. Her skin is now almost completely clear, and occasional flare-ups are quickly brought under control. “If you saw me,” she said, “you wouldn’t know that I ever had atopic dermatitis.”
Before a drug is approved, pharmaceutical companies usually keep the price a secret and do not directly negotiate with insurers until the product is approved by the F.D.A., in part because of concerns that doing so could violate agency rules. But in January, the agency said that drug companies were allowed to discuss price and other issues with insurers in advance.
Even if Dupixent’s $37,000 list price is below those of established drugs like Humira, Regeneron and Sanofi will very likely get to keep more than AbbVie, which makes Humira. That is because the net price of Dupixent, Dr. Schleifer said, will still be over $30,000. Although the rebates that drug makers negotiate with insurers are not public, Richard T. Evans, an analyst for SSR Health, a stock analysis company, has estimated that AbbVie would get to keep less than that, or about $27,500 a year for each patient who uses Humira.
He said a similar drug, nemolizumab, is also being tested for people with moderate to severe eczema and could hit the market in a few years. “Right now they have the benefit of being alone,” Mr. Evans said. “But going forward, I think there will be a lot of price competition.”
In reaching tentative agreements ahead of time, Regeneron and Sanofi appear to have been trying to avoid the pushback they encountered in 2015, when their expensive drug to treat high cholesterol, Praluent, was approved. Although Praluent and a similar drug, known as PCSK9 inhibitors, have been found to be beneficial to patients who don’t respond to other treatments, insurers have limited access and sales have not lived up to expectations.
“We all got that wrong,” Dr. Schleifer said. “But if we can make all of it work so that everybody’s feeling good, then we’ve really changed the paradigm.”
Costly Doctors Don’t Provide Better Care
by Nicholas Bacalar - NYT - March 28, 2017
Doctors who tend to spend more in treating hospitalized patients do not get better results than those who spend less, a new study has found.
Researchers examined spending records of 72,042 physicians at more than 3,000 acute care hospitals. The patients were fee-for-service Medicare beneficiaries 65 and older treated between January 2011 and the end of 2014.
The investigators calculated spending in the first two years, and tracked outcomes in the last two. They concentrated on the types of spending controlled by doctor choice — tests, procedures, imaging studies and so on. The study is in JAMA Internal Medicine.
After adjusting for the varying characteristics of the hospitals, they found that spending among physicians varied by as much as 10.5 percent.
But there was no association over all between higher physician spending and 30-day mortality, or between spending and readmissions. In other words, more spending did not yield better results.
“Even when you go to the same hospital, you’re going to get a different bill — as much as 40 percent higher — depending on who treats you,” said the lead author, Dr. Yusuke Tsugawa, a researcher at the Harvard T.H. Chan School of Public Health. “And you’re not getting better care from a doctor who submits a higher bill.”
Kansas moves to expand Medicaid as GOP legislatures face pressure after ‘Trumpcare’ failure
by Jose A. DelReal and Sandy Somashembar - Washington Post - March 28, 2017
The Kansas Senate votes to accept the federal Medicaid expansion at the statehouse in Topeka on March 28. (Christopher Smith/For The Washington Post)
— State lawmakers in this deep-red state on Tuesday did what a year ago would have been unthinkable: They voted to expand Medicaid under the health-care law that Republicans here have railed against for years.
Among them was Sen. Barbara Bollier (R), whose support last year for extending the government health program to more poor Kansans was considered so rogue that her colleagues tossed her off a health committee. This month, so many Kansas lawmakers voted for the expansion that they nearly mustered the two-thirds majority needed to block the Republican governor’s expected veto.
The abrupt reversal in Kansas could be the front edge of a larger shift nationally, as state lawmakers absorb the repercussions of congressional Republicans’ failed attempt to repeal and replace elements of the Affordable Care Act.
In Virginia, Gov. Terry McAuliffe (D) on Monday pledged to revive efforts in his state’s Republican-led legislature to pass Medicaid expansion. Georgia’s Republican governor, Nathan Deal, also announced plans to change his state’s Medicaid program. Medicaid advocates in North Carolina see hope for renewed momentum as Gov. Roy Cooper (D) has sought to expand the program there through executive action.
Kansas lawmakers are shrugging off what had long been a concern for critics of the health law: that agreeing to expand Medicaid would make the law far more difficult to repeal because it is politically dangerous to revoke benefits once people have them. In Kansas, the expansion would make 150,000 additional low-income residents eligible for Medicaid. Some of the most vocal critics of the GOP repeal plan were Republican governors of states that embraced the Medicaid expansion for their constituents.
The vote in Kansas comes as politicians in Washington also grapple with the fallout of last week’s health-care battle. House Speaker Paul D. Ryan (R-Wis.) is trying to reassure donors that congressional Republicans will go back to the drawing board as they pressed forward on other aspects of President Trump’s agenda. Democrats, meanwhile, are using the moment to press for improvements to the existing health law and to renew calls for universal health care.
Though Kansas legislators strongly approved Medicaid expansion — the 25-to-14 Senate vote included 16 Republicans in favor of it and 14 against it — Gov. Sam Brownback has signaled he will veto the bill, asserting that the health law will collapse regardless of congressional action.
“To expand Obamacare when the program is in a death spiral is not responsible policy,” spokeswoman Melika Willoughby said in a statement. “Kansas must prioritize the care and service of vulnerable Kansans, addressing their health care needs in a sustainable way, not expanding a failing entitlement program to able-bodied adults.”
The vote Tuesday in Topeka was more than just symbolism, sending a clear signal that Republicans nationally are facing new pressure to participate in a program they once saw as one of the 2010 law’s central evils.
Medicaid is administered by the states, combining state and federal dollars to provide health services to low-income people, including children and their caretakers, pregnant women, the disabled, the blind, and those over the age of 65 who qualify. The coverage can vary by state, but the federal government requires it to include doctor’s visits and hospital expenses, among other services.
Expanding Medicaid is the Affordable Care Act’s primary mechanism for extending health coverage to millions of previously ineligible low-income adults. Initially, states were required to participate in the Medicaid program, but the U.S. Supreme Court found the requirement unduly coercive and made expanding the program optional.
Over time, 31 states and the District of Columbia opted in, according to the nonpartisan Kaiser Family Foundation, collecting millions of new federal dollars to cover those adults. Nineteen states, including Kansas, turned down the money, unwilling to enlarge a costly entitlement program that required additional financial contributions at the state level. Besides, they said, why sign on to an expansion that they dearly hoped Washington would eventually repeal?
That created what health experts called a “coverage gap” in the states that declined the expansion. Extremely poor parents continued to receive health care under the original Medicaid program, and people above the poverty level could get subsidies to help them buy coverage on the insurance marketplaces. But those in the middle — the poor, non-disabled single people and slightly-less-poor parents — had no options. That group included more than 2.5 million people last year nationwide, according to Kaiser.
Bollier had long been one of the best-known outliers in her party when it came to Medicaid expansion. A retired anesthesiologist from eastern Kansas, just across the state line from Kansas City, Mo., she said her support was rooted in her concern for poor uninsured patients, who she said often get treatment for acute problems in the emergency room but went without treatment for chronic conditions.
Asked whether she felt vindicated by Tuesday’s vote, she demurred. “I am just elated that we’re now at the point that we can debate this bill,” she said.
Once the bill gets to Brownback’s desk, he has 10 days to veto or sign it. If he does neither, the law automatically goes into effect. Advocates for Medicaid expansion already are mobilizing to whip up the three additional votes in the House and the two additional votes in the Senate needed to override his veto.
The seeds for Kansas’s actions were planted years ago, though proponents of Medicaid expansion say they got a boost from the news out of Washington last week.
Bollier was one of the moderate Republicans elected to the Kansas House and Senate who last year dislodged the grip that hard-line conservatives once held in the legislature. Bollier was elevated from the state House of Representatives to the upper chamber.
Kansas voters had grown weary of severe cuts initiated by Brownback, who pared back income taxes, particularly for the wealthy, and eliminated taxes for about 330,000 businesses, said Burdett Loomis, a professor of political science at the University of Kansas. The state ran out of money to repair highways and its credit rating had been downgraded multiple times, he said.
“In 2016, people finally had enough,” Loomis said. “The experiment wasn’t working.”
At the same time, health-care advocates and hospitals joined forces for a campaign that many credit with helping turn around negative views of the Medicaid component of the Affordable Care Act.
Alliance for a Healthy Kansas, an advocacy group representing dozens of health-care organizations and professionals, cited studies that found that expanding Medicaid would benefit working people and create as many as 4,000 jobs statewide. It emphasized the state’s role in administering Medicaid, which advocates referred to by its local moniker, KanCare.
A January poll by the advocacy arm of the American Cancer Society found that 82 percent of Kansans supported expanding KanCare, a 10-point jump over 2013.
The 2015 closure of Mercy Hospital in Independence, Kan., also was a rallying point. Among the reasons the hospital cited for shuttering was reduced revenue that would have been offset by more Medicaid patients under the health law. The Kansas Hospital Association, which supported expanding Medicaid, warned that other hospitals could similarly fail without government action to ensure that more sick, low-income Kansans had some sort of health-care coverage.
“I think that is exactly what changed the conversation, that we had the closure of a significant rural hospital,” said Sen. Laura Kelly, the top Democrat on the Public Health and Welfare Committee. “What you watched then was the legislators from that area . . . realizing, before an election, that, ‘Oh, my gosh, this is really awful.’ ”
Republican critics of the bill said they are sympathetic to the hospitals’ plight but are reluctant to join a program that they think is flawed.
“I care about my hospitals,” Republican state Sen. Susan Wagle said during a floor debate Monday, growing emotional. “But this is a broken program. It’s a broken program, people.”
The pro-Medicaid position has led to a tricky balancing act for some Republicans, considering that opposition to Obamacare has been a central plank in the GOP platform for years.
On his campaign website, freshman Kansas Rep. John Eplee (R) said he believes health policy should be decided by the state and not the federal government. In an interview, he said he remains opposed to the Affordable Care Act. Yet he has been among the more vocal supporters of Medicaid expansion in Kansas.
“This, in my opinion, is not Medicaid expansion in the sense that it is Obamacare,” Eplee said. “It’s a Kansas plan.”
Kansas Governor Vetoes Medicaid Expansion, Setting Stage for Showdown
by Abby Goodnough and Mitch Smith - NYT - March 30, 2017
Gov. Sam Brownback of Kansas vetoed a bill on Thursday that would have expanded Medicaid in his state, setting up a potential showdown next week with a Legislature that, while heavily Republican, has come to favor extending the largely free health coverage to as many as 180,000 additional poor adults.
Although the bill was easily approved in both chambers of the Legislature, supporters would need to muster three additional votes in the House and two in the Senate to override the veto by Mr. Brownback, a conservative Republican.
After the House briefly debated an override on Thursday, the measure was put aside, probably until at least next week. Supporters were hoping to mobilize hundreds of residents who would benefit from Medicaid expansion, as well as hospital executives, clergy members and others who back the measure, to lobby specific lawmakers over the weekend.
“Our plan is to make sure their phones are ringing off the hook,” said David Jordan, executive director of Alliance for a Healthy Kansas, an advocacy group.
Republican lawmakers in Kansas were initially solidly opposed to expanding Medicaid under the Affordable Care Act, commonly known as Obamacare. But many softened their positions over the last year or so, particularly influenced by the financial struggles of the state’s small rural hospitals. Momentum grew after several Democrats and moderate Republicans picked up legislative seats in the elections last fall, although the leaders of both legislative chambers remain opposed to any expansion.
In his veto message, Mr. Brownback said the cost of expanding Medicaid would be “irresponsible and unsustainable,” citing other states where Medicaid enrollment grew far more than expected after they expanded the program. The expansion effort comes in the midst of a budget crisis that has roiled Kansas for years.
Passage of the Medicaid bill was another sign of revolt against Mr. Brownback, whose tax-cutting regimen led to years of missed revenue forecasts and budget cuts. Last month, House lawmakers voted to override Mr. Brownback’s veto of a bill that would have raised taxes, but the Senate upheld the veto.
Lawmakers face projected budget deficits of more than $280 million for the current fiscal year and more than $510 million for the next year. They also must address a recent state Supreme Court ruling that found public school funding to be unconstitutionally low.
In emotional debate on Thursday, less than a week after President Trump and Republicans in Congress pulled legislation to repeal the Affordable Care Act, Kansas House members who support Medicaid expansion framed the issue as a moral imperative that could save lives and stave off hospital closings in beleaguered towns.
“I am appalled with the letter that was read from the governor,” Representative Larry Hibbard, a Republican, said on the House floor, referring to Mr. Brownback’s veto message. Mr. Hibbard said he worried that some rural hospitals in his district in southeastern Kansas could close without Medicaid expansion, hurting patients and imperiling the future of those towns.
“The lack of compassion toward this issue just blows my mind,” Mr. Hibbard said. “This is a life-and-death issue.”
Opponents often cited concerns about the state’s broader budget challenges.
Representative Chuck Weber, a Republican from Wichita, said expanding Medicaid would make it harder for those already covered by the program to receive care.
Another Republican, Representative Daniel Hawkins of Wichita, noted the uncertainty surrounding the Affordable Care Act, a concern also raised by Mr. Brownback.
Under the Affordable Care Act, the federal government currently pays 95 percent of the costs of expanding Medicaid, eventually dropping to 90 percent but never less. But the Republican repeal bill would have made it all but impossible for states to keep that large federal match.
All but 19 states have expanded Medicaid to cover adults with incomes up to 138 percent of the poverty level — $16,400 for a single person. Voters in Maine will decide whether to do so in a ballot referendum this fall, and Democrats in a few other states are renewing pushes to expand the program now that the Republican plan to repeal the health law has been stalled.
But at the same time, some Republican governors are discussing adding workrequirements for their Medicaid populations or even scaling back enrollment now that the Trump administration has promised states more flexibility in determining benefits and eligibility.
“The next hospital to fail could be in your community or your district,” said one supporter of the expansion, Representative Jim Kelly, a Republican from Independence, where the only hospital closed in 2015. “And I will tell you from experience, real-life experience: It’s not a pretty picture.”
Fight over health care just getting started
by David Farmer - Bangor Daily News - March 29, 2017
The fight for health care is far from over.
Last week, President Trump and Republican leaders in the U.S. Congress suffered a humiliating defeat when they were unable to muster enough support to pass the American Health Care Act.
Lacking support from moderates and conservative Republicans — and from the public — Speaker of the House Paul Ryan was forced to pull the bill from the floor without ever taking a vote.
For seven years Republicans have been at war with the Affordable Care Act. They weaponized the law against Democrats and spewed a mix of misleading facts and outright lies about the law’s effectiveness.
Voters rewarded the Republicans because they really are frustrated with the health care system. But the cure Republicans offered would have made those frustrations even worse, and they would have cost 24 million people their health insurance.
While Obamacare is far from perfect, it did expand health care coverage to millions of people through a combination of subsidies and Medicaid expansion. The uninsured rate in the United States is at historic lows. And the quality of the insurance people have has gotten better, as policies are required to provide essential benefits for things such as maternity care, prescription medicine and health screenings.
Republicans, Trump included, now say they are ready to move on to tax reform. Ryan went so far as to say that Obamacare would remain the law of the land for the “foreseeable future.”
Don’t believe it.
When Trump and Ryan talk about tax reform, they aren’t really talking about making the tax system better, simpler or more efficient.
Their top priority isn’t working people and the taxes that are taken out of their paycheck every two weeks. Their priority is to slash taxes for the wealthy.
Inside the Republican caucus there are real divisions about taxes, just like on health care. Ideas such as a border adjustment tax or tariffs are controversial, and there are deficit hawks who could demand that any changes in the tax code actually be paid for.
And that’s how we end up right back to health care.
The AHCA was built upon the pillar of providing huge tax cuts to the country’s richest people by devastating Medicaid. The AHCA would have cut $880 billion — that’s “billion” with a “b” — out of the program that provides health insurance to children, people with disabilities and older Mainers.
The bill also destroyed the federal-state partnership that funds the program by adopting per-capita caps or block grants, which would have further eroded federal support for health care.
Republican leaders, including Gov. Paul LePage, are perfectly comfortable taking life-saving health care away from people. They’ve done everything they can nationally and in Maine to ratchet down coverage.
It’s mean-spirited, and it’s bad policy.
But it’s also the only place in the federal government outside of defense spending that they can find the money they need to pay for tax cuts for the wealthy.
Progressives, moderates and anyone who believes everyone should have access to health care have the right to celebrate the demise of the AHCA last week. The calls they made to congressional offices, the protests, the letters to the editor — frankly, the honest pleas for help — made a real difference.
They may have literally saved the lives of thousands of people who would have lost health care. And they certainly moved members of Congress to do the right thing.
But the fight is far from over.
Republican leaders will try again, and you can bet that any plan to rewrite the country’s tax laws will once again come for Medicaid and the coverage that the program provides to 265,000 Mainers.
There’s a lot at stake for our communities and our state.
But we also have to remember there’s a lot at stake for Republicans. They’ve made a lot of promises. And there will be tremendous pressure from their base and from their funders for them to deliver.
That’s going to require us all to redouble our efforts to hold the line, particularly around health care.
After all, at least in the House, it wasn’t the devastating cuts to Medicaid that kept the most conservative members from supporting the AHCA. They were perfectly willing to strip health care away from millions of people. It was the fact that the AHCA wasn’t more draconian that kept them away.
Imagine: 24 million people without health insurance wasn’t enough pain and suffering.
Planned Parenthood, Medicaid, Medicare. They’re all still in Republicans’ sights. The fight over health care is far from over.
Health care industry gave a big boost to Maine earnings last year
by Darren Fishell - Bangor Daily News - March 28, 2017
Maine earnings rose about $1.56 billion in 2016, with total personal income growing at the 17th fastest rate in the country.
The figures show Maine catching up slightly with personal income growth in other states since the Great Recession started in late 2007.
About one dollar in six of the new Maine-based earnings went to people working in the health care or social assistance industry, according to the latest figures from the U.S. Bureau of Economic Analysis.
The earnings increase in health care and social assistance was twice the rise in the next-highest industry, management. Construction, state and local government, professional and technical services and accommodation and food services followed.
The income figures compare changes in earnings across industries. They aren’t adjusted for inflation.
Related BEA figures estimate total personal income of Maine residents, compared to other states. Those figures estimate income based on where people live. The earnings by industry are based on where people work.
For Maine residents, the BEA figures estimate total income rose $2.1 billion last year, to just more than $59 billion. That includes three types of income: net earnings from work, government aid, and dividends, interest and rent collected.
The estimate put Maine personal income up 3.7 percent, which was slightly higher than the national rate of 3.6 percent.
Over the long-term, however, Maine ranks much lower. The state is 49th for personal income growth over the decade from 2006 to 2016, ahead of Nevada and basically tied with Michigan, Delaware and Rhode Island.
Failure to Replace ACA Creates Uncertainty in Maine Insurance Market
By PATTY WIGHT
Failure to Replace ACA Creates Uncertainty in Maine Insurance Market
After the death last week of the Republican plan to replace the Affordable Care Act, U.S. House Speaker Paul Ryan declared that the ACA was the law of the land for the foreseeable future. But that future is murky, with more reform attempts expected.
At least one insurance company, Anthem, announced earlier this month that without significant changes, it would start bailing from individual state marketplaces.
Anthem’s announcement came in the form of a March 9 letter from CEO Joseph Swedish to Republican leaders in Congress. Swedish said Anthem would start to “surgically extract” itself from individual insurance exchanges in 2018 unless lawmakers take action to stabilize the market.
A company spokesman declined to comment for this story and could not specify whether Maine would be included in the initial extraction.
Independent health policy consultant Mitchell Stein says Anthem’s position is understandable.
“Anthem is behaving rationally given the market circumstances. Because they’re facing uncertainty,” he says.
And under this uncertainty, the company has to determine its rates for 2018 within the next couple of months. Stein says that’s why Anthem’s letter is asking for stability.
He says two things in particular would make a big difference. One is for the federal government to provide risk sharing, like the $100 billion stability fund proposed under the Republican replacement. That would have allocated money to states to use to lower insurance costs for consumers. And Stein says there’s something else that would help, called cost-sharing subsidies.
Cost sharing subsidies help consumers pay out-of-pocket expenses. During the Obama administration, Congress didn’t allocate funding for those subsidies, so the administration had to find them somewhere else.
The question, says Stein, is whether the Trump administration or current Congress will commit to the subsidies.
“To my mind, that’s the most important unknown we’re facing right now,” he says.
That’s a major question for Maine’s insurance co-op, Community Health Options, as well. CEO Kevin Lewis also wants to see policies that will drive younger, healthier people into the mix.
“Ensure that there is either a mandate or a true penalty for nonparticipation that reflects the actual costs of people staying on the sidelines, because that does affect the entire pool,” he says.
Though Lewis and Stein say the marketplace needs stability, they also agree that it’s not in danger of “exploding,” as President Trump has predicted.
Maine’s other insurer on the individual marketplace, Harvard Pilgrim, did not return a request for comment for this story.
Hospital network that includes EMMC, Mercy braces for credit rating hit
by Jackie Farwell - Bangor Daily News - March 30, 2017
A major credit rating agency is considering downgrading Eastern Maine Healthcare Systems, concerned about the ability of the state’s largest hospital system by geography to pay back its loans.
Moody’s Investor Service has consistently lowered the system’s rating since 2013. Another downgrade would sink EMHS into the “non-investment grade” category, better known as “junk bond” status.
That blow to the system’s creditworthiness could seriously hamper it in issuing bonds, which it relies on to refinance old debt and to fund major construction projects, such as a seven-story tower at its flagship Eastern Maine Medical Center in Bangor. Investors may be less willing to loan EMHS money through those bonds or demand higher interest rates.
That would pose yet another challenge during an already stressful time for hospitals, which are struggling with declining reimbursements from government health insurance programs and uncertainty about the future of federal health reform, among other factors.
“It’s not good for any hospital at any time, but it’s particularly not good at a time when hospitals are facing significant financial stress and uncertainty,” Andrew Coburn, a rural health expert at the Muskie School of Public Service at the University of Southern Maine, said.
Moody’s consideration of a downgrade from Baa3 to Ba1, which would affect $393 million of the system’s outstanding debt, was triggered by EMHS falling short of its expected financial performance during the 2016 fiscal year, according to the credit rating agency. It cited as challenges the “very weak and tenuous state of operating margins” as EMHS works to complete the tower project in Bangor, sustain a turnaround at its struggling Mercy Hospital in Portland and plan for major IT improvements. It also cited the system’s continued efforts to consolidate its network of nine hospitals and other health organizations, the state’s largest health network by geography.
EMHS’ operating margin in 2016 was negative 2.25 percent, meaning the system lost more revenue than it collected for treating patients.
It suffered a $34 million loss that year, more than five times a roughly $6 million loss in operations during 2015, according to its annual report.
Mercy, which the system acquired in 2013 as its first foray into southern Maine, accounts for a large portion of last year’s losses. Its operations were in the red to the tune of roughly $17 million, according to a presentation EMHS made to investors in December. The Aroostook Medical Center in Presque Isle, another EMHS hospital, also posted significant losses.
A credit downgrade likely wouldn’t affect the tower project in Bangor, which is already financed, but it could swell the system’s costs for a planned expansion at Mercy. The Portland hospital has two campuses — an aging facility on State Street and a newer complex on the Fore River — that are expensive to operate concurrently. It has long sought to consolidate operations at the Fore River site as part of a project estimated to cost up to $100 million.
EMHS is working to stabilize Mercy’s finances and shore up the broader system’s performance as it considers the best path forward for the Mercy project, according to Tony Filer, EMHS chief financial officer.
Filer has been in the position for only four months, while Chief Operating Officer Tim Dentry joined EMHS just three months ago. Moody’s appears willing to give both time to settle in at the organization before issuing a decision, Filer said.
“It’s brought focus to us to try and make sure that we can tell a story that keeps us from being downgraded,” he said. “We believe we can, and the fact that they didn’t take that action immediately suggests to us that we have an opportunity to do that.”
Moody’s acknowledged it has held off on the downgrade because of the system’s liquidity and efforts to limit new investment and capital projects. The rating agency expects to issue its decision by mid-May.
Another rating agency, Standard and Poor’s, assigned EMHS a BBB rating, its second-lowest investment grade, last July.
“I want to make sure that whatever we do is for the good of the community and improves their health and their access and we’re good stewards of the resources we have to bear,” Dentry said. “We have a huge opportunity here that indeed impacts the entire state. And it’s a challenge.”
EMHS, similar to many health organizations throughout the country, has heavily invested in new ways of providing care, spurred by reforms under the Affordable Care Act that reward hospitals financially for keeping patients healthy at less cost, rather than steering them toward more visits and procedures. For example, the system significantly lowered readmission rates, which reflect how many patients wind up back in the hospital a month after being discharged, Dentry said.
That means those patients are healthier, but its hospitals are getting paid for fewer admissions.
Many hospital systems are in a similar position, Coburn said.
“It’s taking longer to get to a place where they can show profitability or savings on a lot of these initiatives,” he said. “That’s because there are a lot of initial investments that have to be made and that costs money.”
Following the Mercy acquisition, EMHS added Maine Coast Memorial Hospital in Ellsworth to its fold in 2015, in part because of the hospital’s worsening financial outlook.
The system took on the burden of debt that Mercy and Maine Coast carried, but it didn’t have to spend much cash to acquire them, Filer said. For that reason, he’s comfortable with some early losses because expanding the system creates more opportunities to realize savings, he said, such as by purchasing bulk supplies at cheaper rates.
The larger the system grows, the better it can find efficiencies and improve care, as well as withstand the many pressures facing the health care industry, he said.
“We’re getting stronger and better almost in spite of the fact that the revenue flow is such a challenge,” he said.
More Than Obamacare Repeal, Small Businesses Want Congress to Rein In Costs
by Stacy Cowly - NYT - March 26, 2017
LaRonda Hunter, a business owner in Fort Worth, Tex., views the Affordable Care Act as a literal job killer. Fearful of triggering the law’s employer mandate, which requires businesses with 50 or more workers to offer health insurance or pay penalties, Ms. Hunter has held off on expanding her small chain of hair salons.
She voted for President Trump with the hope that he would quickly make good on his promise to strike down the health care law. On Friday, she watched in despair as the Republicans’ replacement plan unraveled — leaving the law, commonly known as Obamacare, in place “for the foreseeable future,” according to Paul D. Ryan, the House speaker.
“I’m disappointed,” Ms. Hunter, 57, said. “I’m mostly mad at my party for being so disorganized. I’m hoping Trump has learned something about how the government works.”
In Brooklyn, however, another business owner, Leisah Swenson, was ecstatic about the news that Obamacare would be sticking around. Ms. Swenson, 48, and her wife, Monica Byrne, run a restaurant and a catering company. Before the health care law took effect, they struggled to find affordable insurance, and often went without. Now, they have a policy they bought through New York’s state exchange, which recently paid for a critical — and expensive — operation for Ms. Byrne.
“We thought, ‘Thank God,’” Ms. Swenson said of the Affordable Care Act’s continuation. “We’re not young. The car is starting to break down a bit. If we lost this policy, we might not be able to get another.”
As a bloc, small-business owners have been among the health care law’s most vocal opponents. The most powerful trade group for small businesses, the National Federation of Independent Business, is a fierce critic of the law and challenged its constitutionality before the Supreme Court. Some 60 percent of small-business owners want the law repealed, according to two recent surveys by Manta and BizBuySell, which regularly poll owners about their political and economic views.
But every business is uniquely affected by the complex law, and simply demolishing it without putting new guardrails in place is not, for most, the ideal outcome. Small-business owners overwhelmingly say they want Republican and Democratic leaders to quit their partisan bickering, acknowledge that the country’s health care economics are fundamentally broken, and work together on fixing the problem.
“The cost of health care had a significant impact on our profitability last year,” said Tom McManus, 46, the chief executive of KegWorks, a bar supplies retailer in Buffalo. “Obamacare made it worse, but I didn’t see anything in the new bill that would have made it any better. They need to focus on the real health care problem: cost.”
For Thomas E. Secor, who runs the small manufacturing business Durable Corporation in Norwalk, Ohio, every annual renewal of his company’s health insurance plan since the Affordable Care Act took effect has felt like spinning a roulette wheel.
Durable Corporation’s plan, which Mr. Secor said had worked well for the company’s 37 employees, omits some benefits that are required to meet the health law’s minimum coverage standards. So far, the plan has been grandfathered in, allowing Durable to keep it — but if that protection ends, Mr. Secor does not know if his company can afford to continue offering insurance, he said.
“Rural areas like ours are seeing insurance companies just flee,” Mr. Secor, 59, said. “Until somebody comes up with something that addresses cost, you’re going to see a continual erosion of coverage. I don’t care which party it is. Let’s all get together and work on a better product because what we have now isn’t working.”
Bipartisan cooperation on anything has become vanishingly rare in Washington, but one recent effort offered a glimmer of hope: In December, the parties aligned to overwhelmingly support the 21st Century Cures Act. The law increased funding for disease research and included an array of other health care adjustments and changes.
One of them was a fix long sought by small-business owners to an obscure — but, for some, devastating — Affordable Care Act clause that prohibited companies from using pretax money to reimburse employees for insurance that they bought on their own. The Cures Act revived that arrangement, giving it a legal green light for companies with fewer than 50 employees.
The change came as a huge relief for Warren Hudak, 53, who immediately took advantage of it to provide the eight full-time employees at his accounting firm in Lemoyne, Pa., with a monthly allowance toward their health care costs. He would like to see a similar across-party-lines effort to curb health care costs.
“I can’t believe anybody today would look at the Affordable Care Act and say, ‘It’s working fine,’” Mr. Hudak said.
He now pays $2,400 a month — enough, he said with frustration, to hire another worker for his business — for a family insurance policy with a glaring omission: It does not cover the $6,000-a-month prescription drugs his wife needs to combat her multiple sclerosis. Mr. Hudak said he had to contact the drug manufacturer himself and negotiate a discounted rate that his family could afford to pay.
“We have an insurance policy that would cover maternity and substance abuse treatment for my 11-year-old daughter but doesn’t cover my wife’s M.S. drugs,” Mr. Hudak said. “That’s insane.”
Tav Gauss, 61, the founder of a staffing agency in Wilson, N.C., hopes that having Republicans in control of the federal government’s executive and legislative branches will at least reduce the regulatory complexity of complying with health care mandates. He estimated that his company, which has 20 internal employees and 1,500 field workers, had spent around $80,000 on the paperwork and compliance systems that the Affordable Care Act requires.
“The rising costs have taken a toll on all of my investments in people and equipment,” Mr. Gauss said.
Mr. Ryan and Mr. Trump have suggested that they are done with health care for the time being — no new bill or repeal vote is forthcoming, Mr. Ryan said — but Ms. Hunter, the Texas salon owner, thinks they will be forced back into the fray.
“I’m going to urge all of my senators and representatives to continue to work on this,” she said. “Waiting for it all to explode is a terrible solution.”
Mr. Secor, the Ohio manufacturer, also thinks the status quo is not sustainable. A growing number of his employees have dropped their coverage because they cannot afford the premiums and high deductibles, he said.
“People can’t afford the health care they need, and that’s becoming a crisis,” he said. “We need both parties to sit down at the table together and work it out.”
Maine’s low health ranking is a call for action, not further backing off
The decision not to expand health coverage leaves over 30,000 citizens without insurance..
by Andrew Coburn and Deborah Deatrick - Portland Press Herald
- March 30, 2017
We Mainers like to explain our state as a series of dichotomies. Whether it’s physical geography – mountains vs. the sea – or social geography – bustling small cities vs. a rolling rural countryside – we can never quite let go of the idea of “two Maines.” As is often the case with such platitudes, there is an element of truth to this view, and that is certainly the case when it comes to the health status of Maine people.
The latest national County Health Rankings report, released this week by the University of Wisconsin, shows that where Mainers are doing well economically, they are among the healthiest people in the nation, and where Maine people struggle, their health is poor.
In 2017, Washington, Aroostook, Piscataquis, Androscoggin and Somerset counties are at the bottom of the rankings, while Cumberland, Sagadahoc, Knox and York rank at the top. The lowest-ranked counties are poorer, less educated and have more behavioral and environmental challenges than their top-ranked counterparts.
In addition to large disparities among counties, the data tell us that Maine’s health status overall is worsening. In December, the America’s Health Rankings report, which has ranked the health of all U.S. states for 25 years using similar measures to those in the county report, said that Maine slipped from the 15th healthiest state in 2015 to 22nd in 2016. Among a number of troubling findings, data from the U.S. Centers for Disease Control and Prevention show that Maine’s infant mortality rate, an especially sensitive measure of the health of states and countries, is rising despite declines between 2005 and 2010.
The continuing economic deterioration of many of Maine’s poorest counties is perhaps the single most important contributor to these trends. Without adequate incomes, many Mainers struggle to find basic economic security, housing, a good education, healthy food and access to good health care.
Health rankings are a call to action, not a prescription for solutions. For example, in 2009, publication of the America’s Health Rankings report prompted Maine’s largest health care system, MaineHealth, to act. System leaders recognized that achieving their lofty vision of “Working together so our communities are the healthiest in America” was not possible without identifying and addressing problems.
MaineHealth selected six leading health problems with a large impact on health, including low childhood immunization rates, tobacco use, obesity, preventable hospitalizations, cancer deaths and cardiovascular disease deaths – and called for an annual report to track progress on these priorities over time. A seventh priority (opiates and prescription drug abuse) was added in 2012.
MaineHealth’s own Health Index report (also released this week at mainehealthindex.org), was conceived as a way for MaineHealth and its community partners to hold themselves accountable. And through programs such as Let’s Go!, which targets childhood obesity, real progress has been made. Let’s Go! is now being implemented in all 16 Maine counties and has produced both behavior and environmental changes that appear to be having an impact on stabilizing child obesity rates.
Unfortunately, as Maine’s health has deteriorated, the state has stepped away from programs and policies that could help people make better choices. Such disinvestment includes significant reductions in public health nursing in many of our most vulnerable communities and a budget that eliminates funding for obesity and tobacco prevention.
Moreover, according to a recent report, the state has explicitly chosen not to pursue federal grant opportunities to address colorectal cancer screening rates, to improve water testing for arsenic and lead and to address other critical public health problems and needs.
Meanwhile, Maine’s decision not to expand health coverage through the Medicaid expansion option in the Affordable Care Act has left over 30,000 low-income citizens without access to health insurance
Although we cannot immediately change our economy or our social demography, we are not powerless to improve our health. Vermont, New Hampshire and other rural states have seen their health rankings far surpass our own.
Let’s use these rankings not as an indictment, but a call to action. We must first recognize we have a serious problem and acknowledge that poor health will undermine the state’s future economic growth. Then we need a realistic, practical plan that borrows the best ideas from other states.
For all the talk of “two Maines,” only together can we create a thriving state where each community is among the healthiest in America.
Sagadahoc Dems talk health care
Bath forum focuses on universal system by Nathan strut - Time Record Staff - March 30, 2017
BATH
On Wednesday, the Sagadahoc County Democratic Committee and Maine Allcare held a forum on universal health care at the Patten Free Library.
Maine Allcare is a volunteer-driven nonprofit organization that has worked for several years toward implementing a single-payer system — sometimes referred to as Medicare for all — in the state of Maine. Bill Clark of the Midcoast chapter of Maine Allcare says that the state should emulate the example of countries that have adopted single-payer systems, such as Canada.
“Let me put it this way: In single-payer countries, physicians are happy, patients are happy, politicians are happy, everybody’s happy.” said Clark.
The evening also featured a viewing of the film “Now Is The Time.” The short documentary, which was produced by Educational Videos Plus with financial support from Healthcare for All Oregon, explores various attempts to create single-payer health care systems in the United States and advocates for their implementation at the state or national level.
Specifically, it highlights efforts to pass single-payer health care bills through the legislature in New York and the failed attempt to create one in Vermont. It also looks at the national Expanded and Improved Medicare for All Act, of which Rep. Chellie Pingree, D-Maine, is a co-sponsor.
In Maine, efforts are underway to introduce elements of a single-payer system to the state.
“Here in Maine, we have several legislators who are interested. Two of them sit on the Maine Allcare board: Troy Jackson from up north and Sen. Geoff Gratwick from the Bangor area,” said Clark.
Both Gratwick and Rep. Heidi Brooks, D-Lewiston, will introduce bills during the current legislative session to move Maine toward a single-payer system, Clark said.
For Will Neilson, who ran for the Maine House of Representatives in the fall, the Affordable Care Act was flawed, but it moved the ball forward toward a better, single-payer system. The failure of Republicans in the House of Representatives to “repeal and replace” the Affordable Care Act last week leaves the future of the United States health care system uncertain, he added, but also leaves the door open to move closer to a single-payer system.
“Maine might be a place where this could work a few years down the road if everything falls apart otherwise,” said Neilson.
Barring success in the state Legislature, Maine voters may see universal health care on the ballot in the future.
“Our current plan is, if the Legislature doesn’t do anything — which is likely, we put up a citizens’ initiative in 2020,” said Clark.
What’s Allcare?
• MAINE ALLCARE is a volunteer driven nonprofit organization that has worked for several years toward implementing a single-payer system — sometimes referred to as Medicare for all — in the state of Maine.
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