When it comes to money back guarantees in health care, it’s
often less about the money and more about the guarantee.
That’s the biggest takeaway shared by two organizations—Geisinger
Health System and Group Health Cooperative of South Central Wisconsin (GHCSCW)—that
separately rolled out closely-watched campaigns to refund patients their
out-of-pocket costs for health care experiences that fell short of expectations.
Both programs started as a way to inject a basic level of
consumerism into a process long bereft of one. In fact, as consumer frustration
over medical costs rise, a money back guarantee has the potential to win back a
But like many experiments in health care, the effort
produced some unexpected results as well. Instead of a rush on refunds,
executives from both systems said their money-back pledge served even better as
a continuous-improvement tool, with patients providing almost instantaneous
feedback to staff who felt newly empowered to address problems.
Financial well-being, or the state
of an individual’s personal monetary affairs, is one of the six core indicators
of wellness in the Gallup-Healthways Well-Being Index. Poor financial
well-being can lead to a whole host of short and long term mental and physical
health issues, including depression, anxiety, troubled relationships and
It is surprising how American
hospitals and other health providers have neglected financial well-being when
considering their patients’ health. In a recent study by the American Cancer
Association, 56% of Americans suffer from hardships related to the cost of
Medical costs are the primary cause of 67% of all bankruptcies in the United
To think that health care costs are not having a deleterious effect on
American’s general well-being is a complete fallacy.
Even as a former health technology data scientist, I was largely in the dark about how health provider pricing works. Finding health provider pricing is like pulling teeth; it’s extremely time0consuming, frustrating (and sometimes painful) to get a health estimate for even the simplest procedures. Having poor or inadequate insurance can feel like a weight holding you down during your most vulnerable time, in the midst of a major health crisis.
Practices cannot survive the COVID-19 cash flow crisis
By JEFF LIVINGSTON, MD
Will doctors be able to keep their practices open during the worst pandemic in our lifetime? Our country needs every available doctor in the country to fight the challenges of Covid-19. Doctors working in independent practices face an immediate cash flow crisis threatening their ability to continue services.
The CARES Act was signed into law on Friday, March 27, 2020. The law offers much-needed help to the acute needs of hospitals and the medical supply chain. This aid will facilitate the production of critical supplies such as ventilators and PPE. The law failed to consider the needs of the doctors who will run the ventilators and wear the masks.
Cash flow crisis
Private-practice physician groups experienced an unprecedented reduction in in-office visits as they moved to provide a safe and secure environment for patients and staff. In compliance with CDC guidelines, practices suspended preventative care, nonurgent visits, nonemergent surgery, and office procedures.
These necessary practice changes help keep patients safe and slow the spread of Covid-19. The unintended consequence is an unreported and unrecognized cash flow crisis threatening the viability of physician practices.
The only way to
fully eliminate medical debt would be a comprehensive single payer plan, which
allowed no fees at the point of service.
However, such a
plan would require setting all prices for all doctors, hospitals, labs, and
drug companies. All providers would have to be satisfied – in advance — with
what the government is going to pay them on each procedure.
Germany accomplish this through collective bargaining. Japan, France, Taiwan,
Israel and Scandinavia also have national fee schedules. However, I do not
think you could get all the providers in Toledo to agree on one schedule, much
less every provider group in America.
would also require new income and payroll taxes of at least ten per cent more
than we pay now, if we want first-dollar coverage.
The first section of this article stated that many forms of medical debt can be reduced or cancelled by stronger enforcement of consumer protection laws. These debts are not inevitable and are not due to poverty. It would not require trillions of federal dollars to cancel them, either – just the willingness to go against lobbyists.
I advocate the following attacks on medical debt:
cancel balance bills and surprise bills if there was no prior disclosure.
In most cases,
providers will not have the right to collect anything more than what the insurers pay them.
We must cancel the older, inactive “zombie debts” that are being purchased by collection agencies.
This line of
business must terminate. Providers throughout the country are selling
uncollected medical debt for pennies on the dollar to collection agencies, who aggressively attempt to force
patients to pay the full amount due. These debt collectors harass patients at
work and at home, deploying unscrupulous tactics even after the statute of limitations
on the debt has expired.
proposal by Sen. Bernie Sanders to cancel $81 billion of medical debt is a very
good start—but it is only a start.
The RIP Medical
Debt group—which buys old medical debts, and then forgives them—is absolutely
in the right spirit. Its founders Craig Antico and Jerry Ashton deserve great
credit for keeping the issue of forgiveness alive.
over $88 billion in new medical debt is created each year; most of it still
held by providers, or sold to collectors, or embedded in credit card balances.
Tragically, none of this has to happen! In France, a visit to the doctor typically costs the equivalent of $1.12. A night in a German hospital costs a patient roughly $11. German co-pays for the year in total cannot exceed 2% of income. Even in Switzerland, the average deductible is $300.
U.S. patients face cost-sharing that would never be tolerated in Germany, says Dr. Markus Frick, a senior official. “If any German politician proposed high deductibles, he or she would be run out of town.”
By THOMAS WILSON PhD, DrPH and VINCE KURAITIS JD, MBA
A recent study in the New England Journal of Medicine reported on the results of a “hotspotting” program created by the Camden Coalition of Healthcare Providers (Camden Coalition). Hotspotting targets interventions at all or a subset of healthcare superutilizers – the 5% of patients that account for 50% of annual healthcare spending.
of the study were disappointing. While utilization (hospital readmissions)
declined for the hotspotting group, the declines were almost identical in the
control group. At least three headlines
implied that the conclusion of the study was that hotspotting care management
approaches have been proven not to work:
explain, we believe that much of what’s going on here can be explained by one
or both of what we call “RTM Traps” (regression to the mean traps).
essay, we will:
Define RTM (regression to the mean)
Explain the RTM Traps and how many
have fallen into the traps
Suggest how to avoid the RTM Traps
our POV is relevant to clinical, technical, and executive staff in the many
organizations focusing on the superutilizer population – hospitals, physicians,
ACOs, health plans, community groups, etc.
Sometimes you wonder where the line is in health care. And perhaps more importantly, whether anyone in the system cares.
The last few months have been dominated by the issue of costs in health care, particularly the costs paid by consumers who thought they had coverage. It turns out that “surprise billing” isn’t that much of a surprise. Over the past few years several large medical groups, notably Team Health owned by Blackstone, have been aggressively opting out of insurers networks. They’ve figured out, probably by reading Elizabeth Rosenthal’s great story about the 2013 $117,000 assistant surgery bill that Aetna actually paid, that if they stay out of network and bill away, the chances are they’ll make more money.
On the surface this doesn’t make a lot of sense. Wouldn’t it be in the interests of the insurers to clamp down on this stuff and never pay up? Well not really. Veteran health insurance observer Robert Laszewski recently wrote that profits in health insurance and hospitals have never been better. Instead, the insurer, which is usually just handling the claims on behalf of the actual buyer, makes more money over time as the cost goes up.
The data is clear. Health care costs overall are going up because the speed at which providers, pharma et al. are increasing prices exceeds the reduction in volume that’s being seen in the use of most health services. Lots more on that is available from HCCI or any random tweet you read about the price of insulin. But the overall message is that as 90% of American health care is still a fee-for-service game, as the CEO of BCBS Arizona said at last year’s HLTH conference, the point of the game is generating as much revenue as possible. My old boss Ian Morrison used to joke about every hospital being in the race for the $1m hysterectomy, but in a world of falling volumes, it isn’t such a joke any more.
No one likes getting bills. But there is something that stinks particularly spectacularly about bills for healthcare that arrive despite carrying health insurance. Patients pay frequently expensive monthly premiums with the expectation that their insurance company will be there for them when illness befalls them.
But the problem being experienced by an
increasing number of patients is going to a covered (in-network) facility for
medical care, and being seen by an out-of-network physician. This happens because
not all physicians working in hospitals serve the same master, and thus may not
all have agreed to the in-network rate offered by an insurance company.
This is a common occurrence in medicine. At any given time, your local tax-exempt non-profit hospital is out of network of some low paying Medicaid plan or the other.
In this complex dance involving patients, insurers and doctors, Patients want their medical bills paid through premiums that they hope to be as low as possible, Insurers seek to pay out as little of the premium dollars collected as possible, and Doctors want to be paid a wage they feel is commensurate to their training and accumulated debt.
Insurers act as proxies for patients when
negotiating with the people that actually deliver healthcare – doctors.
Largely, the system works to funnel patients to ‘covered’ doctors and
hospitals. Patients that walk into an uncovered facility are quickly
redirected. But breakdowns happen during emergencies.
There are no choices to make for patients arriving unconscious or in distress to an emergency room. It suddenly becomes very possible to be seen by an out of network physician, and depending on the fine print of the insurance plans selected, some or none of these charges may be covered.
I recently saw a patient who received a bill for an outpatient procedure for $333. The Medicare allowable reimbursement for the procedure was $180. I have seen other medical bills where the healthcare provider was charging patients more than 10 times the amount they expected to receive from Medicare or any insurance company.
one of my patients had an unexpected medical complication which necessitated a
visit to an emergency room. He received a huge bill for the services provided.
When I subsequently saw him in my office (for poorly controlled diabetes) he
told me he could not attend future office visits because he had so many
outstanding medical bills and he could not risk incurring any additional
medical expenses. While I offered to see him at no cost, he declined, stating
the financial risk was too high.
patient is required to pay the entire medical bill if they
poor quality insurance
a bureaucratic “referral problem”
an out-of-network provider, which means they have no contractural relationship with the healthcare provider/institution, as might result from an emergency room visit or an unexpected hospitalization.
physicians and other healthcare providers usually do not know what they are
going to get paid for any given service as they contract with many insurance
companies, each of which has a different contracted payment rate. Healthcare
providers and institutions typically set their fee schedule at a multiple of
what they expect to get paid from the most lucrative payer so as to ensure they
capture all the potential revenue. In the process, they create an economically
irrational fee schedule which is neither reflective of a competitive
marketplace nor reflective of the actual cost of the services provided.