Health Care Reform Articles - February 28, 2022

Editor's Note -

There are those who think our current health system, with its lax controls over private as well as public health care expenditures, is good for the American economy.  The following clipping may dampen their enthusiasm, as The Congressional Budget Office joins mega-rich investor Warren Buffet (who once called the health care system a "tapeworm" in the gut of American business) in debunking that myth.

-     SPC

The Government Just Admitted An Inconvenient Truth

by David Sirota - Daily Poster.com - February 25, 2022

Every now and then, federal officials admit some truths that are inconvenient to the corporations that own the government — and this latest admission is pretty explicit: Scrapping corporate health care and creating a government-sponsored medical system would boost the economy, help workers, and increase longevity.

Those are just some of the findings from the Republican-led Congressional Budget Office (CBO) in a new report that implicitly tells lawmakers just how the existing corporate-run health care system is immiserating millions of Americans — and how a Medicare for All-style system could quickly fix the catastrophe.

If that sounds like hyperbole, consider the analysis in its own words. The CBO reports that under a single-payer health care system:

• “Households’ health insurance premiums would be eliminated, and their out-of-pocket health care costs would decline… Administrative expenses in the health care sector would decline, freeing up productive resources for other sectors and ultimately increasing economy-wide productivity… Longevity and labor productivity would increase as people’s health outcomes improved.”
• “Workers would choose to work fewer hours, on average, despite higher wages because the reduction in health insurance premiums and (out-of-pocket) expenses would generate a positive wealth effect that allowed households to spend their time on activities other than paid work and maintain the same standard of living.”
• “That wealth effect would boost households’ disposable income, which they could then split between increased saving and nonhealth consumption. Although hours worked per capita would decline, the effect on GDP would be offset under most policy specifications by an increase in economy-wide productivity, an increase in the size of the labor force, an increase in the average worker’s labor productivity, and a rise in the capital stock.”
• “States could respond to the (ensuing) budget surplus by growing their rainy-day funds (at least temporarily), reducing state tax rates, increasing spending on government purchases or public services, or a combination of all three.”

The report’s findings tacitly admit that the existing employer-based, corporate-run health care system locks the non-rich into toiling more and more hours just to be able to afford ever-higher costs for insurance coverage and medical care.

Indeed, CBO declares that under a single-payer system, households would “retire at younger ages” and “hours worked would be lower for most households across the income distribution.” Under the five single-payer scenarios the agency evaluated, a “reduction in hours worked would be largest among lower- and middle-income households because those groups would see the largest percentage increase in wage rates and reductions in (out-of-pocket) expenses and premiums.”

CBO’s report seems to cast these forecasts as a warning — but they should be welcome news. Studies have long shown that on average, Americans work more hours than their counterparts in other industrialized nations, and they receive among the fewest hours for vacation and paid family leave.

CBO is effectively admitting that the corporate health care system is intensifying that problem.

One health care option evaluated by the CBO includes more robust coverage for home- and community-based care services, which provide patients with long-term assistance with daily living activities such as bathing or dressing. In addition to increasing eligibility and expanding those services for patients, the report notes that increased funding would create a 7 percent pay increase for home health care workers, who are among the lowest paid workers in the economy.

And yet for all the single-payer health care benefits outlined by CBO, Medicare for All remains stalled in a political system where stakeholders in the existing corporate health care system are spending hundreds of millions of dollars to buy elections and public policy.

That political influence was on display in the most recent presidential election, when Joe Biden kicked off his campaign with a fundraiser with a health insurance CEO, and then vowed to veto Medicare for All legislation if it came to his desk. He instead touted his proposal of building upon the Affordable Care Act with a public health insurance option.

But Biden hasn’t pushed that public option plan as president — he even omitted it from his budget plan last year. He and Democratic leaders have instead adopted proposals from health insurance lobbyists to put more Americans on subsidized for-profit health insurance plans.

More recently, California’s attempt to create a first-in-the-nation single-payer system failed after corporate interests won the day in a state where an overwhelming majority of voters believe the governor and legislature should prioritize working toward guaranteeing all residents health insurance coverage. The single-payer bill was killed by Democratic lawmakers just after their party received a $1 million check from a major private health insurer.

Despite those setbacks, the new CBO report is a loud alarm about the establishment’s sociopathic hostility to commonsense health care policy - and it comes from an important source.

The office is hardly some bastion of left-wing utopianism, and in a money-drenched political system, the federal government rarely ever admits such scathing truths about the status quo — especially truths that underscore how much better life could be with the kinds of reforms other nations long ago made.

https://www.dailyposter.com/the-government-just-admitted-an-inconvenient-truth/ 

What Physicians Need to Know About Private Equity Deals

Ericka L. Adler, JD, LLM - Medscape - February 9, 2022

The sale of medical practices to private equity (PE) and related investors continues to be the trend in 2022. The primary reason private practices are so interested in selling to PE is that they typically will offer a much higher purchase price compared with either hospitals or other physician buyers.

However, the sale to any buyer comes at a cost to the physician-sellers as well, and this is something with which many physicians continue to struggle.

A PE's standard investment strategy is to acquire a practice with an existing footprint and reputation, and then grow the practice through the acquisition of additional smaller practices or by hiring more physicians. Typically, the structure of the transaction is such that the nonclinical assets of the practice are sold to a business entity owned by the PE (or a related entity) and the clinical assets are transferred into a professional entity owned by a physician, which may or may not be the physician-sellers.

The reason for this structure is that many states have a "corporate practice of medicine" doctrine, which prevents unlicensed people from owning professional entities or employing licensed providers. The PE controls the ownership and conduct of the physician-owned professional entity through written agreements, instead of directly, in order to comply with the law.

Corporate practice of medicine laws were created with the intent to avoid commercialization of medicine and to make sure physicians could exercise their own professional opinions without outside influence. Many states also have developed specific guidance in this area. Generally, to comply with the legal doctrine, documents in any kind of PE transaction are carefully written to promise providers freedom over clinical decision-making and ensure that true clinical decisions are left to physicians.

To operate a medical practice, the PE's business entity acts as a management company by providing all the nonclinical assets it just acquired and everything else the practice needs to operate: space, equipment, nonprofessional personnel, billing and collection services, et cetera. A management fee is paid by the professional entity to the management company, thus drawing profits to the PE investors.

The more efficiently and profitably the practice is run, the greater the profit that is pushed up to PE investors. Therefore, there is a clear incentive to the professional entity to be as profitable as possible.

The problem that arises in these kinds of transactions is that management decisions can directly affect the practice of medicine and clinical outcomes. In negotiating PE transactions, I fight hard on behalf of my physician clients to maintain control over the items that they feel impact patient care. This can include hours of service, staffing levels/type of staff, equipment and products available, amount of time that can be spent with patients, employee compensation and benefits, and cost of services and other similar issues.

Unfortunately, these are battles that typically cannot be won, and the PE buyer will insist these are pure management decisions. The PE's position, of course, is that it needs to control these factors in order to grow profitability and efficiency of the practice. Arguably, this is the same position taken by hospitals, and even private practices, in running their business operations.

What management items and services cross the line in their impact on clinical care? We may soon have a clearer answer to this question. Recently, a group of emergency medicine physicians sued Envision Health Care, alleging that it violated California laws that bar corporations from practicing medicine. Envision owns and/or partners to operate hundreds of emergency medicine groups across the country. In the lawsuit filed by the American Academy of Emergency Medicine Physician Group (a unit of the American Academy of Emergency Medicine), it is alleged that the PE is interfering with the way the medical practices are being run.

Examples given include increasing billings to patients, insurers, and third party-payers for physician services, leading to excessive billing. Additionally, the lawsuit argues that Envision profited by reducing physician compensation, increasing the number of patients that physicians see per hour, and increasing the utilization of physician assistants to replace costlier physician coverage. Envision also is alleged to track physician medical decision-making to provide practice improvement feedback reports, which are designed to "educate" physicians to practice medicine and make decisions that increase the amounts charged to patients.

It is hard to know whether a court will agree that any of the factors mentioned in the Envision case directly impact professional decision-making. However, this decision is being watched closely as it could affect PE deals, as well as a variety of other healthcare arrangements and transactions in those states that enforce the corporate practice of medicine doctrine.

In transactions in which I am involved, we are already discussing these issues and trying to find ways to allow for more physician input on some business decisions. Physician advisory boards and regular meetings on designated issues can sometimes help to alleviate conflicts on these issues.

For practices that may be entering into PE transactions or thinking about doing so, it is important to fully understand what power is retained and/or sold in any such transaction. Once sold, the practice no longer belongs to the physicians, and there always is an inherent conflict between providing the most thorough clinical care and achieving top profitability and efficiency.

In every transaction, both sides must understand and agree on their roles and whether they can live with the deal they are trying to consummate.

https://www.medscape.com/viewarticle/967950?

Justice Dept. Sues to Block $13 Billion Deal by UnitedHealth Group

The agency’s lawsuit against the deal for a health technology company is the latest move by the Biden administration to quash corporate consolidation.

by David McCabe - NYT - February 24, 2022

WASHINGTON — The Justice Department on Thursday sued to block a $13 billion acquisition of a health technology company by a subsidiary of UnitedHealth Group, in the latest move by the Biden administration to clamp down on corporate consolidation.

The agency argued that a deal by UnitedHealth to buy the health tech firm Change Healthcare would give UnitedHealth sensitive data that it could wield against its competitors in the insurance business. The suit was filed in U.S. District Court for the District of Columbia. New York and Minnesota also joined the lawsuit.

A spokeswoman for Optum, the UnitedHealth subsidiary, said in a statement that the Justice Department’s “deeply flawed position is based on highly speculative theories that do not reflect the realities of the health care system,” and added that the company would “defend our case vigorously.” A spokeswoman for Change Healthcare said it was still “working toward closing the merger as we comply with our obligations under the merger agreement.”

The deal is the latest transaction to run into opposition from the Biden administration, which has made countering corporate consolidation a central part of its economic agenda. President Biden signed an executive order last year to spur competition in different industries. He also appointed Lina Khan, a prominent critic of the tech giants, to lead the Federal Trade Commission and Jonathan Kanter, a lawyer who has represented large companies, as chief of antitrust efforts at the Justice Department.

Since then, the F.T.C. has blocked Lockheed Martin from buying a maker of missile propulsion systems and the chip giant Nvidia from purchasing the design firm Arm. Even before Mr. Kanter was confirmed, the Justice Department sued to block the merger of two major insurance brokers; the purchase of Simon & Schuster by the publisher Penguin Random House; and a deal that would have married some of JetBlue’s operations with American Airlines’.

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“It’s part and parcel of this effort to make sure that markets truly are competitive,” said William Baer, who previously served as the head of the Justice Department’s antitrust division.

In a statement, Attorney General Merrick B. Garland said the agency “is committed to challenging anticompetitive mergers, particularly those at the intersection of health care and data.”

Optum said last year that it would buy Change Healthcare, a company that offers technology services to insurers. UnitedHealth is one of the largest health corporations in the country, with $287.6 billion in revenue in 2021. In addition to its health care information technology business, its Optum unit owns physician practices, a large chain of surgery centers and one of the nation’s largest pharmacy benefit managers.

At the center of the Justice Department’s lawsuit is the data that Change Healthcare gathers when it helps process insurance claims. The department argued that the deal would enable UnitedHealth to see the rules that its competitors used to process claims and undercut them. UnitedHealth could also crunch data about patients at other insurers to gain a competitive advantage, the agency said.

The lawsuit claims that, according to a UnitedHealth estimate, more than half of American medical insurance claims “pass through (or touch)” Change Healthcare’s systems. It says that UnitedHealth’s former chief executive saw the tech company’s data as the “foundation” of the reasoning behind the deal.

The lawsuit also argued that UnitedHealth could withhold Change Healthcare’s products — which other insurers use — from its rivals or save some of its new innovations for itself. The Justice Department added that the deal would give UnitedHealth a monopoly over a type of service that was used to screen insurance claims for errors and speed up processing.

The companies have said the acquisition will improve efficiency in the industry. They also explored selling the part of Change Healthcare that the Justice Department said would give UnitedHealth a new monopoly.

Lawmakers and regulators have increasingly worried that big businesses could use troves of data to hurt their rivals. A congressional committee has investigated whether Amazon uses data from outside merchants who use its platform to develop competing products, for example. Critics of Facebook have also argued that the company’s having years of user data makes it difficult for an upstart service to challenge its dominance.

Since Mr. Kanter joined the antitrust division at the Justice Department, critics have said he should not oversee cases against companies whose rivals he represented while in private practice. According to a financial disclosure form he filed last year, he once represented Cigna, a major insurer that competes with UnitedHealth, and the remote health care company Teladoc.

Mr. Kanter has not participated in the lawsuit against UnitedHealth, a person familiar with the Justice Department’s case said.

https://www.nytimes.com/2022/02/24/business/doj-antitrust-lawsuit-unitedhealth.html

The Maine Millennial: Don’t blame nurses’ wages for our health care system’s ills

A call by Reps. Pingree, Golden and 200 of their colleagues to investigate nurse staffing agencies could have unintended consequences. 

by Victoria Hugo-Vidal  - Portland Press Herald - February 25, 2022

At the end of January, under the radar, Rep. Chellie Pingree, Rep. Jared Golden and 200 other members of Congress took a look at the wreckage of the current American health care system and decided that the problem is that some nurses are making too much money.

Seriously. They signed an open letter about it. The letter, written by Vermont Democratic Rep. Peter Welch (a New Englander who should have more common sense) and Rep. H. Morgan Griffith, R-Va., would be hilarious if it weren’t so stupid. Their target is travel nurses and the nurse staffing agencies that employ them.

“Travel nurses,” for the unfamiliar, go from hospital to hospital for short-term contracts, wherever they are most needed. If a nurse who works in a hospital has to go out on maternity leave for a few months, for example, the hospital might bring in a travel nurse as a replacement. Travel nurses make good money, and they deserve it: Nursing is hard, moving around constantly is hard. Hospitals often rely on them because, while a travel nurse might cost more per hour than a nurse on staff, hospitals don’t have to make the commitment of providing them benefits, or keeping them around all year, even if the patient load drops. Travel nurses are also less likely to unionize. There’s not a lot of slack in the American health care system, as many people discovered during the pandemic, when patients flooded hospitals, non-COVID procedures were canceled and ER patients stayed overnight in hallways. Travel nurses were able to hop from hot spot to hot spot, serving through wave after wave.

The letter, addressed to Jeffrey Zients, the White House COVID-19 response coordinator, expresses shock and dismay that “certain nurse-staffing agencies are taking advantage of these difficult circumstances to increase their profits at the expense of patients and the hospitals that treat them.” No shoot, Sherlock. Literally every for-profit actor in our health care system does that, including many for-profit hospitals, which, at the end of the day, answer to their investors, who expect a particular rate of return. The representatives write that they “have received reports that the nurse staffing agencies are vastly inflating price, by two, three or more times pre-pandemic rates.” The important phrase here is “pre-pandemic.” When the pandemic hit, more people than usual got sick, so the demand for nursing went up. The supply of nurses went down, which means what, kids? That’s right! The price of a nurse’s labor went up!

You reap what you sow. Our government decided to privatize our health care system and let capitalism run wild. And in capitalism, some people get to make lots of money at the expense of others. Now they’re mad that some women are making money. Yes, I’m alleging the stink of sexism here: Nursing, as a profession, is 90 percent female. Meanwhile, 64 percent of physicians are male. You will notice that nobody is complaining about doctors making too much money. (There also are “travel doctors,” aka “locum tenens physicians,” but an industry survey found that the cancellation of elective surgeries meant that hospitals’ demand for them dropped during the pandemic.)

Payroll is the biggest expense for any business, and lots of hospitals and other medical facilities, particularly for-profit ones, would like to see nurses making less money. But nurses are pretty universally beloved, for good reason, and no politician is going to be dumb enough to say they think nurses need a pay cut. Travel nurses and travel nurse agencies make an excellent scapegoat. Capping rates of pay for travel nurses is a clever way to get a foot in the door of capping pay for all nurses and driving down wages overall. After all, folks who travel from place to place every few months are hard to organize into a constituent voting bloc and aren’t likely to have the opportunity to build community political power.

I’m surprised that so many representatives signed on to this letter. After all, Democrats like to say they support health care workers, and Republicans like to say they are pro-business and free market. My mom is a mystery writer, and when we are trying to figure out a mystery or puzzle, she likes to say, “Cui bono? Who benefits?”

Who benefits from cracking down on travel nurse agencies? It sure isn’t staff nurses. See, travel nurse agencies play an important role in the health care economic ecosystem: They provide a bargaining chip to keep staff nurse wages high. If a nurse feels she isn’t being paid what she’s worth (and, generally speaking, she probably isn’t), she can leave her hospital to work for a travel agency, and make more money while seeing the world! This helps keep wages high. My fear is that a crackdown on travel nurse agencies will cause nurse wages across the board to be lowered. Cui bono? Certainly not patients. Do you want your catheter inserted by an exhausted, overworked nurse who’s worrying about how she is going to pay rent?

I don’t expect much from politicians, but I did expect better from Chellie Pingree and Jared Golden. Pingree and Golden should retract their signatures of support.

If they would like to target price-gouging at the expense of patients, I have plenty of suggestions. My friend Lindsey’s dad has cancer. Specifically, myelodysplastic syndrome-induced leukemia. He has a $10,000 copay for his chemotherapy drug. No, that’s not a typo. He has to come up with $10,000 or die. Where’s his outraged letter to the White House?

https://www.pressherald.com/2022/02/20/the-maine-millennial-nurses-wages-arent-whats-hurting-our-health-care-system/

 

 

An Essayist Navigates the Labyrinth of American Health Care. Barely.

by Sarah Manguso -NYT - February 26, 2022

COST OF LIVING

Essays

By Emily Maloney

The illness narrative, ending in financial ruin and decreased quality of life, has become one of the classic 21st-century American stories. In her debut essay collection, Emily Maloney documents the complex intersections of money, illness and medicine. For Maloney, the primary experience of receiving health care is not merely a bodily or spiritual event but always, also, a financial one. She understands on a granular level the relationship of money to being ill, to developing a drug, to housing and caring for patients and, of course, to managing an unfathomable amount of debt. Her broad perspective is hard won; at different times she has been a multiply diagnosed chronically ill patient, an E.M.T., an emergency room medical technician, a drug rep, a data analyst, a medical writer, a medical debtor and an American citizen who has — so far — survived the ongoing catastrophe of for-profit medical care.

The precipitating event in “Cost of Living” is the author’s psychiatric hospitalization at 19: “It wasn’t that I had wanted to die, exactly. It was more that I just couldn’t keep living.” Maloney’s choice of a nearby, independent hospital’s emergency room over the bigger university hospital “where the state might pick up your bill if you were declared indigent” leads to the crushing debt at the heart of the book. “Sitting on a cot in the emergency room, I filled out paperwork certifying myself as the responsible party for my own medical care — signed it without looking, anchoring myself to this debt, a stone dropped in the middle of a stream. This debt was the cost of living.”

As Maloney pries deeper into the machine of American health care, she finds no central mechanism other than that of the eternal money-go-round. By the time she gets to the conference at which doctors are painstakingly comped for their attendance at brunches with “soggy pastries” amid “transfer of value” concerns, I had lost all hope for a ready solution to the problem — which, Maloney implies, is inseparable from the very structures of capitalism.

Each essay documents a different kind of structural failure, caused or complicated by capital and inevitably ending in harm to patients. In one, Maloney is prescribed 26 psychiatric medications for what turns out to be a vitamin D deficiency, hypothyroidism and a neurologically based developmental disorder. In another, as an E.R. tech she is trained to “bill up” — increasing charges if at all possible — but she secretly perfects the occult art of minimizing patient cost without tripping any corporate alarms.

Embedding herself into various corners of the bureaucratic medical machine, Maloney describes everyone she encounters with the same perspicacity. “There’s a fine line between a pain patient and a drug addict,” she writes, “and sometimes patients go back and forth across it.” “Elizabeth … was what we called a frequent flier, someone who was unable to make sense of the world she lived in and so she came to us instead, a kind of tent revival in our suburban hospital, for healing.” A medical student, meanwhile, is “a strange mix of sweaty and cavalier.”

Thanks to her experiences, Maloney is able to see the cracks in what a less informed patient might experience, simply, as care: “At my doctor’s office for a masked annual physical, my internist depression screens me. I know it’s because Epic, the online medical record system he uses, prompts him to do so. Northwestern Medicine is part of a program that uses an installation of Epic that depression screens everyone.”

While working as a medical publications manager at a pharmaceutical company, where she becomes a part of the conference circuit for the first time, she is struck by the sheer scale of the apparatus. “Yes, the research everyone does is important. Yes, the work to take a drug from preclinical stages to the market is huge and hugely expensive. But the rest — the advertising, the television commercials, the hamburger sliders, the endless catered lunches, the agency money, the plane tickets to Europe — are all, directly or not, contributing to this enormous cost.”

Maloney’s essays read as if they were begun in low light, with little sense of where they were going or how far. They start with a question and work things out on the page. They don’t seem concerned about arriving at a grand unified theory of anything. They notice everything and have nothing to prove. They don’t prematurely grasp at an ending. These qualities combine to elevate this collection far above the usual first-person essayistic fare. The challenges of Maloney’s background — familial trauma, poor medical care, occasional indigence — form part of the back story, but they are ultimately beside the point of this book. Her broad authority and the quality of the prose — astute, compassionate and lethally funny — are what make these essays remarkable. Maloney is an exceptionally alert writer on whom nothing is lost, who sees everything with excruciating clarity, including the unassailable fact that in this country, there is currently no tidy passage through the interconnected quagmires of illness, money and care.

https://www.nytimes.com/2022/02/25/books/review/cost-of-living-emily-maloney.html?

 

Health Care Reform Articles - February 23, 2022

 

Editor's Note - The following clipping is from The Health Justice Monitor dated February 22, 2022 -SPC   Paul Farmer, Medical Visionary

Summary: Paul Farmer, an inspirational leader in global health, passed away, too young at 62. His powerful vision for social justice in health should guide us to single payer in the US and to use the resulting huge savings to improve health around the world.

Paul Farmer, Pioneer of Global Health, Dies at 62 New York Times Feb. 21, 2022 By Ellen Barry and Alex Traub   Paul Farmer, a physician, anthropologist and humanitarian who gained global acclaim for his work delivering high-quality health care to some of the world’s poorest people, died on Monday on the grounds of a hospital and university he had helped establish in Butaro, Rwanda. He was 62.   “There are so many people that are alive because of that man,” Dr. Rochelle P. Walensky, director of the Centers for Disease Control and Prevention, said in a brief interview, adding that she wanted to compose herself before speaking further.   Dr. Anthony S. Fauci, President Biden’s top medical adviser, broke down in tears during an interview, in which he said he and Dr. Farmer had been like “soul brothers.”   Quotes from Paul Farmer Oct. 26, 1959 - Feb. 21, 2022   "I critique market-based medicine not because I haven't seen its heights but because I've seen its depths."   "I mean, everybody should have access to medical care. And, you know, it shouldn't be such a big deal."   "But if you're asking my opinion, I would argue that a social justice approach should be central to medicine and utilized to be central to public health. This could be very simple: the well should take care of the sick."

Comment by: Jim Kahn Paul Farmer was a determined and inspiring moral leader in global health. I had the pleasure of knowing Paul a little, and the rough experience once of taking a more pragmatic view than Paul’s unyielding belief that everyone deserves world class medical care, wherever they live. He set the bar high, and millions benefited from that perspective. He was brilliant, indefatigable, and kind. I mourn his passing, and dearly hope that his vision derives broader support from the accolades that are already being offered. In the United States, with its vast resources, there is no excuse for not providing universal health coverage. As Paul wrote, market medicine sinks to unacceptable depths; everybody should have access to medical care; and social justice should be central to medicine.  With single payer, the argument sometimes offered by economists like me that we can’t afford to do everything falls away. Because, as you all know, single payer shifts the waste in our health care market into meeting all care needs for everyone. And indeed, we would achieve enough extra savings to massively boost US support for global health efforts. Let’s honor Paul Farmer by passing single payer in the US, and by multiplying medical resources for needy countries around the world.

Biden’s Hidden Health Care Triumph

by Paul Krugman - NYT - February 10, 2022

A Republican member of Congress said something epically stupid the other day.

No, I’m not talking about Marjorie Taylor Greene’s warning about Nancy Pelosi’s “gazpacho police.” If you ask me, Greene was performing a public service; we all need some good laughs, especially given the demise of the borscht belt.

I’m talking, instead, about Representative Thomas Massie of Kentucky, who tweeted out a novel argument against universal health care: “Over 70% of Americans who died with Covid, died on Medicare, and some people want #MedicareForAll?”

To belabor a point that should be obvious, Medicare recipients have been especially vulnerable to Covid because they generally suffer from a serious pre-existing condition: advanced age.

Maybe Massie should have looked instead at Canada, which has single-payer health insurance for everyone — it’s even called Canadian Medicare. Canada, as it happens, has had only about a third as many Covid deaths per capita as we have. More generally, Canadians can expect, on average, to live almost four and a half years longer than Americans, even though health care spending per person is only about half as high as in the U.S.

In any case, whatever its intellectual merits, as a practical political matter Medicare for All isn’t coming to America any time soon. What’s actually at stake in the political arena are more incremental policy changes. Yet such changes can still have a huge effect on health care. And the partisan divide on health policy is as wide as ever.

Massie’s statistical gaffe was a reminder that Republicans still hate government programs that help Americans pay for health care. I wonder how many voters remember how close the Trump administration came to repealing the Affordable Care Act, a move that the Congressional Budget Office estimated would cause 32 million Americans to lose health insurance. That effort failed only because three Republican senators had the courage to stand up to Donald Trump.

Does anyone imagine that we’ll see a similar display of courage if a party that considers a violent attack on the Capitol “legitimate political discourse” regains control of Congress and the White House?

More immediately, if the G.O.P. regains control of either house of Congress this November, we’ll almost surely see some reversal of the major health care gains that have been taking place under President Biden.

Oh, you haven’t heard about those gains? I’m not surprised. Health care is one of the huge but hidden successes of Biden’s first year.

The story so far: Obamacare, which was enacted in 2010 but didn’t go fully into effect until 2014, was and is a bit of a Rube Goldberg device. Instead of simply paying Americans’ medical bills, it expanded Medicaid while using regulations and subsidies to encourage an expansion of private insurance. It fell far short of universally guaranteed coverage, but it nonetheless led to a large decline in the percentage of nonelderly Americans without health coverage.

Trump, as I said, tried but failed to undo this achievement. He did, however, preside over a gradual erosion of health coverage, probably reflecting a lower-profile strategy of sabotage on multiple fronts.

Despite this erosion, the core of the Affordable Care Act remained intact; in 2020 the AC.A. really proved its worth, helping (with an assist from emergency federal programs) to sustain health coverage despite huge job losses.

And the Biden administration has moved to strengthen the program. It increased outreach to potential enrollees, which Trump’s officials had drastically scaled back, while the American Rescue Plan substantially expanded subsidies for Americans buying insurance on health care exchanges. According to the National Health Insurance Survey, the percentage of nonelderly Americans without health insurance fell significantly between the fourth quarter of 2020 and the third quarter of 2021, bringing it almost back to its pre-Trump low.

The months ahead look set to be better still. Enrollment in the A.C.A.’s exchanges is limited to a few months a year, to deter people from waiting until they get sick to buy insurance. The enrollment season for 2022 coverage is just winding down now, and we’re seeing blockbuster numbers: More Americans are signing up for coverage than ever before.

We still won’t have the kind of universal health care guarantee that every other advanced nation has managed to provide its citizens, but we are getting closer.

Unfortunately, this progress faces huge political risks. The rescue plan provided only two years of enhanced subsidies; unless Democrats either pass an extension quickly or hold both houses of Congress, the subsidies will soon be gone. And if Republicans get unified control in 2024, they’ll surely send us back to the era when health insurance was available only to people who had either jobs providing good benefits or impeccable medical histories that made them attractive to private insurers.

So I hope people will remember what we almost lost in 2017 and understand that even if Republicans aren’t currently talking about it very much, health care is still very much on the ballot.

https://www.nytimes.com/2022/02/10/opinion/biden-health-care-triumph.html?

 

Angry Customers, More Work and Longer Hours Strain Pharmacists

by Madeline Ngo - NYT - February 10, 2022

Pharmacists and technicians, who have played a critical role in administering Covid-19 tests and vaccines, say they are burned out nearly two years into the pandemic.

WASHINGTON — Ken O’Shea spent eight years working in retail pharmacies, first as a technician and then as a pharmacist. He liked working on the front lines and seeing his patients get better over time.

But during the pandemic, Mr. O’Shea said, he had less and less time to counsel patients. On top of his regular job, he had to juggle coronavirus vaccinations and testing, more phone calls and angrier customers who would berate him if prescriptions took longer to be filled. His workload worsened after three colleagues quit in the span of two months.

Mr. O’Shea, a 28-year-old pharmacist in Virginia Beach, quit working full time at Walgreens on Dec. 30 and recently began a job at an insurance company. He has been working one shift every two weeks at Walgreens while the pharmacy is still understaffed, he said.

Nearly two years into the pandemic, pharmacists and technicians across the nation are under intense strain as their jobs shift from filling prescriptions and counseling patients to administering Covid-19 vaccines and tests, handing out masks and dealing with increasingly angry customers.

The situation has been exacerbated by a labor shortage that has squeezed most industries and that has resulted in droves of nurses and caretakers leaving their posts in a pandemic that has pushed them to the brink.

Large retail pharmacy chains have tried to respond, with some reducing store hours, increasing starting wages, offering more breaks and giving out bonuses to retain employees. But customers have felt the impact, with some experiencing disruptions in vaccine appointments, longer lines to pick up prescriptions and frustration over securing masks and at-home virus tests.

The situation is worrying the pharmacy industry. Scott Knoer, the executive vice president and chief executive of the American Pharmacists Association, said inadequate staffing posed serious health risks by increasing the chances that workers make mistakes while filling prescriptions or inoculating patients. A survey released last month from the association found that 74 percent of respondents said they did not think they had sufficient time to safely perform patient care and clinical duties.

Mr. Knoer said pharmacies were struggling to deal with a lack of pharmacists and technicians, though shortages have been most dire for technicians, who serve as support staff and help dispense medication. Technicians receive a median hourly wage of $16.87 and have more options to pursue better-paying jobs in other industries. There were 166,337 pharmacy technician job postings through the fourth quarter of 2021, up about 21,100 from the year prior, according to a Pharmacy Workforce Center report.

Some of the biggest pharmacy chains have hired thousands to deal with the increased workloads, but company representatives say stores are still struggling to fill open positions.

Fraser Engerman, a spokesman for Walgreens, said the company had responded to labor shortages by reducing some store hours, lifting wages and adjusting vaccine appointment availability. Mr. Engerman said most stores were still operating normal hours.

In October, Walgreens increased its starting wage to $15 an hour for technicians, a rate that will increase by a dollar this year. The company has also awarded bonuses of $700 to $1,250 to pharmacists and new technicians.

Rite Aid recently temporarily closed most pharmacies an hour early on weekdays to allow its pharmacy staff to “catch up from the day and prep for the next,” said Terri Hickey, a Rite Aid spokeswoman. Most of its pharmacies are limiting walk-in hours for immunizations to just one hour a day.

“Even when stretched, we are working hard to stay open and support the health of our customers,” Ms. Hickey said in a statement.

While most CVS stores are operating normal hours, some have temporarily closed on one or both days of the weekend, said Michael DeAngelis, a CVS spokesman. To attract and retain workers, he said, the company is giving employees more scheduled breaks and will raise its minimum wage to $15 an hour this summer.

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In some cases, reduced hours at pharmacies have led to disruptions in vaccine appointments with no notice.

Mark Kulhavy, 48, a sales representative in Rock Island, Ill., said he took his 16-year-old son to their local Walgreens for his booster appointment on Jan. 6. But before entering, Mr. Kulhavy saw a sign on the door that said the store could not administer vaccinations that day because of staffing shortages. The technician behind the counter told Mr. Kulhavy to try another Walgreens nearby, where they waited half an hour for his son to receive a shot.

Mr. Kulhavy said he understood that the pharmacy staff was not at fault, but he wished he had been notified about the closure.

“Part of me was frustrated,” Mr. Kulhavy said. “I jumped through hoops to get him there on time when he got out of school only to walk up to the door and see that sign.”

Nicole Christian-Brathwaite, 40, a psychiatrist in Boston, said her husband tried to pick up his medication at their local Walgreens on Jan. 12, but the drive-through was closed because there were not enough workers. After entering the store, her husband saw at least a dozen people standing in line, and he later left over fears of catching the virus.

Ms. Christian-Brathwaite said many of her patients had also started to ask for 90-day prescriptions instead of 30-day ones to avoid dealing with pharmacy delays. She called it another symptom of the nation’s “crumbling” health care system.

Michael Hogue, a former president of the American Pharmacists Association and the dean of Loma Linda University’s School of Pharmacy, said some pharmacies were already operating with fewer workers before the pandemic because some chains were trying to reduce staff and close stores to lift profitability. Once the United States started rolling out vaccines, chain pharmacies went on hiring sprees.

But companies may find it harder now to attract and retain employees who are not willing to take on the extra workload. Jon C. Schommer, a professor at the University of Minnesota’s College of Pharmacy, said wages were already stagnating before the pandemic because more pharmacy schools opened in response to a shortage of workers in the 2000s. In 2020, the median annual salary for pharmacists was $128,710, according to the Bureau of Labor Statistics.

Although some chains are offering financial incentives, a recent survey from the American Pharmacists Association found that 47 percent of respondents said they were working more hours during the pandemic, while only 12 percent reported a salary increase.

Pharmacists and technicians said they were leaving retail pharmacies for jobs at hospitals or pharmaceutical companies, while some have simply decided not to work for now.

People on social media have aired their concerns under the hashtag “PizzaIsNotWorking.” Bled Tanoe, 35, an Oklahoma City pharmacist who left Walgreens in August to work at a hospital, started the campaign to underscore the strain that pharmacists and technicians were feeling. She now is pressing pharmacies to increase pay and provide more support to staff.

Emily Sis-Sosa, a 26-year-old in Kernersville, N.C., said she could no longer work as a technician at a large retail chain after her workload swelled and some customers grew angrier during the pandemic. If prescriptions were delayed, some would throw empty prescription bottles or insurance cards at her.

“I had never experienced rage like that from people that I knew for six years,” she said.

Ms. Sis-Sosa said the job was not worth the $16.95 she made an hour. She left in September to work for a drug distribution company.

Dallas Reynolds, 35, a pharmacist in Northern Virginia, said he had felt increasingly burned out over the course of the pandemic. Although he would work longer hours to catch up, he said, the pharmacy would often be two or three days behind on filling prescriptions. Since he quit in December, he said, he has felt less anxious and depressed, even though he was unsure what he would do for work next.

“I was happier taking a break from work than I was actually having a stable job and getting a paycheck,” Mr. Reynolds said. “That’s how bad it was.”

Smaller independent pharmacies have also experienced staffing challenges. Sixty-eight percent of independent community pharmacies reported having a difficult time filling staff positions, according to a recent survey from the National Community Pharmacists Association.

Sonia Martinez, a 55-year-old pharmacist who co-owns Marco Drugs and Compounding in Miami, said it took four months to fill an open technician position, a task that would have normally taken a few weeks. Ms. Martinez works about 15 extra hours every week, she said, leaving her with less time to spend with family.

“I don’t know when it’s going to end,” Ms. Martinez said. “It’s just frustrating.”

https://www.nytimes.com/2022/02/10/us/politics/pharmacists-strain-covid.html 

 

Why California’s Cowardly Democrats Scurried Away From Single-Payer

The corporations flexed their muscle—and won—even in this very progressive state. That’s because it was never about better health care or taxes, but corporate power.

by Abdul El-Sayed - The New Republic - February 10, 2022

Two weeks ago, Assembly Bill 1400, a bill that would have cleared a pathway for single-payer, Medicare for All–style health care for the good people of California in the form of “CalCare,” suffered an ignominious death. Its lead sponsor, Assemblymember Ash Kalra of San Jose, elected not to even bring the bill to a vote. “It became clear that we did not have the votes necessary for passage, and I decided the best course of action is to not put A.B. 1400 for a vote today,” he said.

This is California we’re talking about—possibly the most progressive state in the nation, at least west of Vermont. Democrats hold a supermajority in the House. The California Democratic Party platform explicitly claims to support “single-payer” health care. It’s a state where 95 percent of the public believes that “making sure all Californians have access to health insurance coverage” is important. And yet Democrats couldn’t pass single-payer health care.

That’s because it wasn’t about health care or the taxes to pay for it at all. It was about the remarkable power corporations continue to wield over elected Democrats.

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In response to CalCare’s failure, the California Nurses Association, longtime supporters of single-payer health care, noted Kalra’s unwillingness to expose his colleagues—that he chose to “cover for those who would have been forced to go on the record about where they stand on guaranteed health care for all people in California.” And that’s exactly it. CalCare was murdered like Caesar: betrayed by its ostensible allies, all of whom participated so that none of them could be fully blamed.

Why the betrayal? Because the bill was a nonstarter for California’s most powerful business groups. The California Chamber of Commerce led a coalition of 122 business groups in opposition to the bill. Opposition was the most vehement from the groups representing Big Health Care, including the California Association of Health Plans, the California Hospital Association, the California Medical Association, and the California Agents and Health Insurance Professionals. And these are the groups from whom too many Democrats take donations … and political orders.

Assembly Speaker Anthony Rendon, who shelved a previous version of the bill in 2017, said after the failure of A.B. 1400: “I’m deeply disappointed that the author did not bring this bill up for a vote today. I support single-payer and fully intended to vote ‘yes’ on this bill.” You might think that the Assembly speaker would have put more muscle into whipping votes from something he “supports” and “intended to vote ‘yes’” on, rather than piling on a junior member of his caucus after the fact.

Indeed, over the course of his career, Rendon’s campaigns have taken gobs of money from the very same corporations and lobby groups opposing A.B. 1400. Let’s follow the money: Rendon has taken $50,700 from the California Medical Association; $33,300 and $32,000 from UnitedHealth Group and Blue Cross Blue Shield of California, respectively; and $25,900 from the California Association of Hospitals and Health Systems.

The betrayal goes further. Governor Gavin Newsom campaigned in 2018 on single-payer health care: “I’m tired of politicians saying they support single-payer but that it’s too soon, too expensive, or someone else’s problem.” But he failed to utter a single word in support of A.B. 1400. When he was asked about it, Newsom said, “I have not had the opportunity to review that plan, and no one has presented it to me.” You mean to tell me that you’re the governor of the country’s biggest state, and you don’t have time to review a bill that would massively transform health care in a direction you claim to support? In an interview with The Mercury News, Kalra noted that “it hurts when you’re trying to garner votes for a policy that the governor is brushing aside despite a prior commitment to it.”

Indeed, Newsom’s own Healthy California for All commission to study universal health care estimated that Californians would pay $522 billion on health care in 2022. The U.C. Berkeley labor center estimates that A.B. 1400 would have cost only $222 billion a year, saving Californians nearly 60 percent on health care. Even more conservative legislative estimates put the savings at 25 percent, with most of those savings accruing to low-income people in the state. That’s because A.B. 1400 is progressively funded, raising revenue through excise and payroll taxes on businesses and raising personal income taxes on salaries higher than $149,509 a year.

For Newsom’s part, his most recent campaign for governor took $130,400 from UnitedHealth Group, $120,300 from the California Medical Association, and $98,800 from Blue Cross Blue Shield of California.

As the story of the demise of single-payer health care in California is written, much ink will be spilled over fears of tax increases or a “one-size-fits-all” program run like the Department of Motor Vehicles. These are, after all, the talking points the opponents of single-payer have promulgated. Less attention will have been paid to the way that Democrats’ addiction to corporate funding weds them to do industry’s bidding—to betray their own party platform to oppose a policy that would guarantee them health care while saving them billions.

https://newrepublic.com/article/165338/california-democrats-calcare-single-payer-health-care 

 

What Physicians Need to Know About Private Equity Deals

by Ericka Adler - Medscape Internal Medicine - February 9, 2022

The sale of medical practices to private equity (PE) and related investors continues to be the trend in 2022. The primary reason private practices are so interested in selling to PE is that they typically will offer a much higher purchase price compared with either hospitals or other physician buyers.

However, the sale to any buyer comes at a cost to the physician-sellers as well, and this is something with which many physicians continue to struggle.

A PE's standard investment strategy is to acquire a practice with an existing footprint and reputation, and then grow the practice through the acquisition of additional smaller practices or by hiring more physicians. Typically, the structure of the transaction is such that the nonclinical assets of the practice are sold to a business entity owned by the PE (or a related entity) and the clinical assets are transferred into a professional entity owned by a physician, which may or may not be the physician-sellers.

The reason for this structure is that many states have a "corporate practice of medicine" doctrine, which prevents unlicensed people from owning professional entities or employing licensed providers. The PE controls the ownership and conduct of the physician-owned professional entity through written agreements, instead of directly, in order to comply with the law.

Corporate practice of medicine laws were created with the intent to avoid commercialization of medicine and to make sure physicians could exercise their own professional opinions without outside influence. Many states also have developed specific guidance in this area. Generally, to comply with the legal doctrine, documents in any kind of PE transaction are carefully written to promise providers freedom over clinical decision-making and ensure that true clinical decisions are left to physicians.

To operate a medical practice, the PE's business entity acts as a management company by providing all the nonclinical assets it just acquired and everything else the practice needs to operate: space, equipment, nonprofessional personnel, billing and collection services, et cetera. A management fee is paid by the professional entity to the management company, thus drawing profits to the PE investors.

https://www.medscape.com/viewarticle/967950?

The first public option health plan in the U.S. struggles to gain traction

By Markian Hawryluk - Kaiser Health News - February 21, 2022

With prospects dim for the U.S. to adopt a single-payer Medicare-for-All program, health care reform advocates turned instead to an insurance plan designed by the government that could compete with private insurance plans sold on the health care exchanges. The idea behind this “public option” is that it could ultimately expand health care access by making a lower-cost plan available to consumers.

But the public option plan, though backed by Presidents Joe Biden and Barack Obama, also has gone nowhere due to political opposition in Congress.

Some states have picked up the banner and are creating their own public option plans. But they, too, are facing formidable opposition from the health care establishment, which is resisting the pressure to reduce costs on the back end so that consumers can pay less.

Washington State, in its second year of offering the nation’s first public-option health insurance plan, has learned an important lesson: If you want hospitals to participate, you’re probably going to have to force them.

The Washington public option is more of a public-private partnership: The plan was designed by the state but is offered by private insurance companies. Anyone buying their own policy on the state’s health insurance marketplace can sign up for a public option plan, and depending on their income, may receive significant subsidies from the federal government to lower its cost.

But two years in, the plans are available in only 25 of the state’s 39 counties, enrollment numbers have been underwhelming, and state leaders blame hospitals.

“The plans had a hard time getting networks put together because the hospitals wouldn’t play,” said state Rep. Eileen Cody, the Washington legislator who introduced the public-option bill in 2019. “They’re a big part of the problem.”

Officials from the Washington State Hospital Association said that more hospitals than not are voluntarily participating in public-option plans. But, they noted, the public option relies on cutting payments to hospitals to control costs and ties reimbursement to Medicare rates, which don’t cover hospitals’ cost of providing care.

“If patients opt to join a public-option plan rather than private insurance, over time it could create financial challenges, especially for small, rural providers operating on thin margins,” said Chelene Whiteaker, senior vice president of government affairs for the hospital group.

Washington State legislators last year voted to mandate that hospitals contract with a public-option plan if public-option plans weren’t available in each county in 2022. That mandate will go into effect for 2023.

Others states watch Washington’s public option struggles

Now, other states looking at a public option are learning from Washington’s challenges. Colorado and Nevada, which are implementing public-option plans for 2023 and 2026, respectively, have already incorporated ways of forcing hospitals to participate. And other states considering a public option — including Connecticut, Oregon, New Jersey, and New Mexico — are likely to follow suit.

“One thing that the states have learned is you cannot make it optional for hospitals to participate,” said Erin Fuse Brown, director of the Center for Law, Health & Society at Georgia State College of Law. “Otherwise, there’s just no way for the public option to have a chance. It will never build a sufficient network.”

Washington’s public option was designed to save consumers money primarily by lowering what hospitals and doctors get paid, capping aggregate payments at 160% of what Medicare would pay for those services. By comparison, health plans had been paying providers an average of 174% of Medicare rates.

Public option plans are available to anyone and come in the same gold, silver, and bronze tiers as private plans on the health insurance exchange. Proponents estimated the cap would result in public-option plans having premiums 5% to 10% lower than traditional plans on the exchange. But public-option premiums were, on average, 11% higher than the lowest silver plan premium available in each county on the marketplace in 2021, and a silver public-option plan had the lowest premium in just nine counties. Silver plans cover, on average, about 70% of health care costs.

Only 1% of people buying plans on the exchange chose public-option plans in 2021. Public-option premiums for 2022 came in about 5% lower than public-option premiums in 2021. This year’s enrollment numbers have not been finalized — the state is waiting to see how many of the people who signed up complete the process by paying their premiums.

“We know premiums are what drive decision-making in terms of enrollment,” said Liz Hagan, director of policy solutions for United States of Care, a nonprofit that advocates for improving health care access. “People often don’t look at anything other than the premium. They rarely look at the out-of-pocket costs.”

But exchange officials say that savvy consumers are finding that the public-option plans are less expensive in the long run. Compared with traditional exchange plans, they have lower deductibles and provide more services not subject to the deductible.

“Premium is still king,” said Michael Marchand, chief marketing officer for the Washington Health Benefit Exchange. “But we have a lot of people who have gotten a lot smarter about how they’re pricing out something.”

Marchand also said it may take a few years for a new product like the public-option plan to gain traction in the marketplace. Insurance companies may have priced their plans a little high in the first year, not knowing what to expect. Now, with a year under their belt, they have lowered premiums somewhat.

Limited choices for cutting costs

Washington’s stumble out of the gate reflects the difficulty of lowering health care costs while working within the current system. Legislators originally wanted to cut payment rates to hospitals and other providers much more, but they raised the cap in the legislation so hospitals wouldn’t oppose the bill. Now, it’s unclear whether the payment cap is low enough to reduce premiums.

“That’s kind of the big trade-off,” said Aditi Sen, a health economist with the Johns Hopkins Bloomberg School of Public Health. “You are trying to lower premiums enough that people will enroll, but not so much that providers won’t participate.”

That will be a challenge for any state or federal public option plan. There are only so many ways to lower premiums. Hospitals, doctors and other health care professionals have pushed back hard against any cuts in their payment rates, while insurance plans balk at plans that could eat into their profits.

Plans can reduce the size of their provider network to save money, but consumers dislike plans that limit what doctor they can see. Public options plans could rely on existing public health programs, like Medicare and Medicaid which already pay lower rates than commercial insurance, but government-run insurance plans carry negative connotations for many consumers.

Sen and her colleagues found that in 2021, Washington counties with public-option plans were primarily in areas where hospital and physician payment rates were lower than those in other parts of the state. That may have helped insurers build out networks and still stay under the 160% provider payment cap.

Five of the 12 private insurers that sell plans on the exchange offer public-option plans.

Insurance companies that had previously offered plans in Washington were able to cobble together networks based on existing contracts with hospitals and physician groups. But two carriers new to the Washington exchange had to start from scratch and negotiate prices with providers for their public-option plans. Some of the insurance companies tried to offer public-option plans in other counties but could not persuade hospitals, particularly those in larger hospital systems, to accept their rates.

Washington saw enrollment in public-option plans start to climb during a special enrollment period launched in mid-2021 because of the COVID-19 pandemic. The American Rescue Plan Act also provided more subsidies, which made all plans on the exchange more affordable. But those subsidies are due to expire at the end of the year unless Congress votes to extend them. An extension is included in the Biden administration’s Build Back Better legislation, but it has stalled in Congress.

Washington legislators approved other moves to make the public option more affordable. They set aside $50 million in state subsidies, but officials must still determine how to allocate those funds. And lawmakers authorized the state to pursue a waiver with the federal government that could allow the state to keep more of the savings achieved through premium reductions. Currently, lower premiums also mean lower subsidies from the federal government. The state can request those savings be passed through to consumers.

Washington did not pursue such a waiver before implementing its public-option plan, but many believe the Biden administration might be more amenable to such a request than the Trump administration.

State progress on public-option plans comes amid disappointment among many progressives that Congress did not implement a federal public option under the Affordable Care Act to compete with private plans on the marketplaces.

Washington state officials realize that because they were the first to implement a public option, other states will be watching them closely to see how it all plays out. “We’re not the only ones, but we’re the furthest along,” Cody said. “Other people can learn from our mistakes.”

https://whyy.org/npr_story_post/public-option-health-plan-struggles-to-gain-traction/ 

 

Bill Nemitz: Welcome to long-term care insurance. You want some sanity with that?

Thousands of worried Mainers seek the state's protection from triple-digit premium hikes. 

by Bill Nemitz - Portland Press Herald - December 5, 2021

 

Twenty-one years and more than $75,000 ago, Linda and David Brookes had a plan: With retirement on the not-too-distant horizon, they’d start funneling money into their new long-term care insurance policies. In return, when age and infirmity finally caught up with them, they’d get the help they need without going broke or becoming a financial burden on their four children.

Then came the shakedown.

“This letter is to notify you that we have recently filed for a 112% premium rate increase in your long term care insurance policy,” read the letter David received from Genworth Life Insurance Co. this fall. Linda got the same notice – except Genworth said it wants to bump her premium by 146 percent.

Typos? They wish.

Some kind of practical joke? There’s nothing funny about it.

A company passing the buck – or in this case, the bill – for its own failure? Now we’re getting warmer.

“It’s unbelievable,” Linda Brookes said in an interview last week. “I just can’t believe it.”

Nor can the hundreds of other Mainers, all in their twilight years, who logged in Thursday for an online forum on one of the insurance industry’s most colossal screw-ups in modern times. Long-term care insurance, once ballyhooed as the key to peace of mind and financial security, is fast becoming the boondoggle of the century.

The Brookeses are, by any measure, a responsible, prudent couple.

Linda, 72, is a retired social worker. David, 81, worked for Motorola. They lived for 20 years in Scarborough before moving in 2015 to Florida, confident that when the time came for long-term care – not covered by Medicare and most supplementary health plans – their Genworth policies would foot the bill. No relying on their children for money, no draining their assets and hoping their fixed incomes might qualify them for Medicaid, no dependency whatsoever beyond the coverage Genworth promised them all those years ago.

They also thought, at least at first, that their monthly premiums would remain affordable – while Genworth had the right to make occasional adjustments, any rate increases would have to first be approved by the Maine Bureau of Insurance.

But increases of 112 percent and 146 percent? Or, in the case of other Maine policyholders, 178 percent? Let me go out on a limb here and suggest that’s beyond unfair.

“It is. I couldn’t agree more,” Eric Cioppa, the bureau’s superintendent, said in an interview following last week’s forum. “If I’m not here to help out consumers in this case to the extent I can, what am I here for?”

At the root of all this is an industry-wide product in free fall. As Cioppa noted at the outset of Thursday’s four-plus-hour marathon, the long-term care insurance market arose about 40 years ago and was, from the beginning, built on a host of severely flawed assumptions:

Insurers thought they could fund future claims over the long term by investing premium payments at an annual rate of return somewhere between 6 percent and 8 percent. In reality, the bonds in which all that cash was stashed have performed, as Cioppa noted, at “well under 4 percent.” Meaning Genworth, like other companies that made the same mistake, now finds itself in a hole that will only grow deeper as more claims pour in.

The insurance companies also factored in a “lapse rate” – the number of customers who over time fail to renew their policies – at between 4 and 5 percent, just like the longstanding rate for life insurance policies. Wrong again – fewer than 1 percent of long-term care policyholders have let their plans lapse.

Finally, the companies miscalculated their morbidity projections – or, to be more blunt, they thought their customers would die sooner. Alzheimer’s and other long-lasting diseases have turned that assumption on its head.

All of which brings us to the central question that had more than 400 Genworth customers – with almost 4,100 policies in Maine, it’s the state’s largest long-term care provider – glued to their computer screens Thursday: Who should have to pay for this screw-up, the customers who signed on in good faith or the company that made a colossally bad bet?

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Linda Brookes, who along with her husband has already sunk $75,057 into their Genworth policies since 1999 and would now see their premiums jump from $5,184 to $11,868 annually, was more than ready for her turn to speak. Her deeply researched presentation initially clocked in at over seven minutes, but she trimmed it to meet the forum’s initial five-minute ground rule. Then, after the list of people wanting to speak grew beyond 200, the speaking slots were cut to a mere two minutes, forcing Brookes to further condense her outrage.

“I find myself struggling to define the difference between elder financial exploitation and coercion and the premium-raising practices of Genworth and the (Maine Bureau of Insurance). It seems a very fine distinction indeed,” she said, referring not just to the latest proposed rate hike but to other increases and benefit cuts she and her husband already have endured in recent years.

Unlike many others who used their allotted time simply to vent, Brookes then quickly listed her recommendations for cleaning up this mess: Impose a moratorium on all premium increases until solutions can be found that take customers’ concerns into account. Recognize the “erosion of trust” in not just the insurance industry but also the state officials who are supposed to regulate it. Factor in the savings Genworth will realize from people who reduce their benefits to save their policies. Account for the money Genworth has saved due to policyholders dying sooner than projected from COVID-19. And finally, allow companies like Genworth to improve their cash reserves by investing in more than just the low-yield bond market.

All good ideas. Here’s another: Shift the burden of responsibility for this circus away from the policyholders and onto Genworth and the other companies who, from the outset, were far better at selling these plans than at estimating how much they’d cost. That reckoning might start at the top – as more than one speaker noted at last week’s forum, Genworth President and CEO Thomas McInerney’s annual compensation package is north of $9 million.

“This does not appear to be reflective of a company struggling to say solvent,” Brookes observed in her pre-edited comments.

It’s hard to say where all this is headed. Genworth wants its request for a rate hike wrapped up by August, although Superintendent Cioppa won’t go beyond saying it will be resolved sometime in 2022. Genworth in all likelihood won’t get all it wants – it’s up to Cioppa to determine whether the proposed new rates are “excessive and discriminatory” – but those sitting on policies still lie awake worrying how much they’re going to get soaked this time.

As Brookes put it after giving her two minutes’ worth at the forum, “The most we can do is to educate the public on an issue that has led to serious consequences for policyholders. And hope the powers that be will pick up on the opportunity to actually do some good ‘for the people’ by legislating effective barriers” to Genworth’s and other insurers’ stunning arrogance.

Late Friday, I received an email from Danielle Bolt, senior communications manager for Genworth. Most of it was a recap of what another company official had already said at Thursday’s gathering – all rooted in the reality that Genworth’s projections, like the rest of the industry’s, “played out differently than projected.”

Bolt also listed a range of options from which Genworth policyholders now can choose: Keep paying the full premium, however jacked up it turns out to be. Accept further benefit cuts in exchange for a lower (but still higher) monthly bill. Or stop paying premiums now and, if and when need arises, Genworth will pay claims up to but not exceeding the total premiums paid to date. (That last one’s a real laugher – any policyholder could have achieved the same thing simply by putting their money in a cookie jar.)

Noted Bolt, “We are focused on leveraging the touchpoints we have with our policyholders to provide education on their coverage and potential coverage needs.”

If only they’d educated themselves first.

https://www.pressherald.com/2021/12/05/welcome-to-long-term-care-insurance-you-want-some-sanity-with-that/

An $80,000 surprise bill points to a loophole in a new law to protect patients 

by Jay Hancock - Kaiser Health News -  February 23, 2022

When Greg and Sugar Bull were ready to start a family, health challenges necessitated that they work with a gestational surrogate. The woman who carried and gave birth to their twins lived two states away.

The pregnancy went well until the surrogate experienced high blood pressure and other symptoms of preeclampsia, which could have harmed her and the babies. Doctors ordered an emergency delivery at 34 weeks of gestation. Both infants had to spend more than a week in the neonatal intensive care unit.

It was April 2020, early in the coronavirus pandemic. Unable to take a plane, the Bulls drove from their home in Huntington Beach, Calif., to the hospital in Provo, Utah. They had to quarantine in Utah before they could see the children in the hospital.

A couple of weeks later, after the babies could eat and breathe on their own, the Bulls took them home to California.

Then the bills came.

The patients: Scarlett and Redford Bull, newborn twins covered by a Cigna policy sponsored by Greg Bull's employer. The gestational surrogate had her own insurance, which covered her care.

Medical service: Neonatal intensive care when the babies were born prematurely after emergency induced labor. Scarlett spent 16 days in the NICU; Redford, 10.

Total bill: $117,084. The hospital was out of network for the infants. Cigna paid for some of Scarlett's care, for reasons the Bulls couldn't figure out. The Bulls were left on the hook for about $80,000, for both babies. Their account was ultimately sent to collections.

Service provider: Utah Valley Hospital in Provo, Utah, one of 24 hospitals run by Intermountain Healthcare, a nonprofit with about $8 billion in revenue.

What gives: The Bulls' ordeal points up a loophole in coverage for emergency care — even under the federal No Surprises Act, which went into effect on Jan. 1 and outlaws many kinds of surprise medical bills.

Patients who need prompt lifesaving treatment often don't have time to find an in-network hospital. In the past, health plans sometimes have said they would pay for emergency care even if it's out of network. The No Surprises Act now makes this a legal requirement in every state. The provider and insurer are supposed to negotiate a reasonable payment, leaving the patient out of the equation.

But what if the insurance company denies the care is for an emergency? Or the hospital doesn't supply the paperwork to prove it?

That's what happened to the Bulls. Cigna said it lacked documentation that the NICU care for the twins qualified as an emergency.

So the Bulls began receiving insurance explanations showing huge balances owed to Utah Valley. They had expected to owe the family out-of-network, out-of-pocket maximum of $10,000 for the twins' care. They assumed most of the bills would be paid by Cigna soon. They weren't.

"I was like, there is no way this can be real," said Sugar Bull, an interior designer.

"Dear Scarlett Bull," began one of Cigna's letters, addressed to a 6-month-old baby. "We found the service requested is not medically necessary."

How could NICU care not qualify? The gestational surrogate was admitted to obstetrics by her doctor without going through the emergency department, which prompted Cigna to initially conclude there was no emergency, said Dylan Kirksey of Resolve Medical Bills, a consultancy that eventually worked with the Bulls to resolve the claims.

To establish that there was, Cigna asked for daily progress notes and other medical records on the infants. The Bulls tried to get the hospital to comply. Cigna kept saying it hadn't received the necessary documentation.

The Bulls appealed. Sugar Bull spent hours with insurance paperwork and hold music. But almost a year later, about $80,000 in bills remained. Utah Valley sent the accounts to collections, she said. It was the last thing she had time for.

"I own a company, and I am super-busy and we had twins," she said. "Every two weeks or so, I would feel a panic and righteous anger about it. And I would keep pushing and calling, and it would take, like, five hours every time."

Though they disputed what they were being charged, the Bulls agreed to pay the hospital $500 a month for five years to settle just one of the babies' bills, in an attempt to keep their good credit.

Resolution: With seemingly nowhere else to turn, the family hired Resolve, which beats a path through the claims jungle in return for a portion of the money it saves clients.

"It was a lot of prodding" to get Utah Valley to give Cigna the information it needed to pay the hospital, said Kirksey, a senior advocate with Resolve, which was founded in 2019 and has 16 employees. He said he had to give the hospital a detailed list of steps to take and then follow up with multiple calls and emails per week.

In the end, most of the errors causing the Bulls' nightmare were on the hospital's side, Kirksey said. But instead of supplying what Cigna needed, Utah Valley went after the Bulls.

"The hospital repeatedly failed to provide a detailed list of services and important clinical information, despite our continuous efforts to secure the information," said Cigna spokesperson Meaghan MacDonald.

"There were no errors on the hospital's part," said Utah Valley spokesperson Daron Cowley. "Utah Valley Hospital properly billed for services provided to the twins and provided the requested information to Cigna in a timely manner." 

Greg and Sugar Bull initially agreed to pay Utah Valley Hospital $500 a month for five years to settle just one of the babies' bills. Ultimately, they paid Resolve Medical Bills $8,000 after the company helped get their hospital bills, totaling more than $80,000, straightened out.

The hospital didn't bill the Bulls for outstanding balances until nine months after the twins were born and didn't send the accounts to collections until six months after that, "after the family did not return the legally required paperwork to set up a payment plan," he said.

Finally, in the fall of 2021, the bills were settled. The twins were 1 1/2 years old. To compensate Resolve for curing the balance, the Bulls paid the company about 10% — $8,000.

The fee, though substantial and unrelated to medical care, was worth it to avoid the much larger debt, said Greg Bull, who works in finance. "At the end of the day, it was such a relief for it to be a smaller amount," he said. Still, many families could not have afforded it.

The takeaway: About 1 in 5 emergency room visits is at a facility that is out of network for the patient's insurance, research has shown. The No Surprises Act requires insurers to cover non-network emergency treatment with the same patient cost-sharing as in-network care. It also prohibits hospitals from billing patients extra.

But if the insurer denies that the care was for an emergency or doesn't obtain documentation to prove that it was, the claim can still be rejected and the patient left on the hook.

"That's a coding issue we see a lot," said Kirksey, especially "if the person didn't literally check in through the emergency room."

If this happens, insurance experts urge patients to immediately appeal the decision to the insurance company, a process that the law requires be available. Unfortunately, that usually requires more phone calls, paperwork and waiting. (If the appeal with the insurer fails, patients can then turn to an independent reviewer, like their state insurance board, state attorney general's office or the No Surprises Help Desk.)

"It would be a critical step for the consumer to leverage their appeal rights ... and get the determination that it was an emergency service from the get-go," said Kevin Lucia, co-director of the Center on Health Insurance Reforms at Georgetown University.

Once it's established that the visit was for an emergency, he said, protections from the No Surprises Act clearly apply.

The No Surprises Act may be a step in the right direction. But it is clear that loopholes and minefields remain. 

https://www.mainepublic.org/npr-news/2022-02-23/an-80-000-surprise-bill-points-to-a-loophole-in-a-new-law-to-protect-patients