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Tag: The ACA

Health Reform Without Apologies

Have you ever seen a fair, unbiased, evenhanded explanation of the Patient Protection and Affordable Care Act? Have you ever seen anything that even appeared to be objective? I haven’t.

So to fill the gap, my colleagues and I have produced “What Does Health Care Reform Mean To You? A Consumer’s Guide,” which explains how the new health care overhaul works, in a question-and-answer format. You can also get a pamphlet version— ideal for doctors’ offices, clinics, work places and everywhere else that people meet and socialize.

That it’s the first effort anyone has made to even try to be objective is in itself rather amazing. See if you agree on whether we succeeded and give us your comments.

During the nine-month period leading up to the passage of the Patient Protection and Affordable Care Act (PPACA), Americans were subjected to more than $200 million worth of TV, radio, newsprint and Internet ads. Almost all of these — pro and con — were pure propaganda.Continue reading…

If Reform Fails

If conservatives manage to kill health care reform legislation, what will happen next?

I really don’t want to go there.

First, I’m convinced that conservatives won’t be able to repeal the Affordable Care Act (ACA). Democrats will hold onto the Senate, and President Obama still has a veto. If necessary, he will use it to protect the bill. Meanwhile, the majority of the public either favors the legislation or want to “wait and see” how well it works. Most voters would be utterly disgusted if Congress returns to the health care debate this fall. It was ugly the first time around; virtually no one wants to watch re-runs on C-Span. In the months ahead, Americans hope that their elected representatives will do just three things: create jobs, create jobs, and create jobs.

Secondly, if conservatives somehow succeed in crippling the reform bill, we will find ourselves back in a world of laissez-faire health care where medical spending continues to spiral by 4.5% to 9% a year (just as it has for the past ten years), thanks to a combination of climbing prices and rising utilization.

Here, I’m not talking about how much insurance premiums rose: reimbursements that private insurers, Medicare and Medicaid paid out to hospitals, doctors and patients over the past ten years have been climbing by 4.5% to over 9% annually.

In some years, Medicare reimbursements were growing faster; in other years, payouts by private insurers levitated. Over the same span, Kaiser reports that premiums for a family plan rose by an average of 13.1% a year.

Continue reading…

The Other Medicare Report

The release of this year’s Medicare Trustees report was unprecedented. As noted in previous posts here and at my blog here and here, Medicare’s chief actuary not only refused to sign off on it, he disowned it — encouraging readers to ignore it and focus instead on an alternative report, prepared by the office of the Medicare actuaries.

So what’s the difference in the two reports? It all relates to the health reform bill that passed last spring. The formal trustees report shows health reform dramatically reducing future Medicare spending. In fact, it is so dramatic that even the White House seems reluctant to talk about it — perhaps because it’s prima facie unbelievable.

Consider this: In 2009, the trustees reported that (looking indefinitely into the future) Medicare had an unfunded liability of $89 trillion. This year, the trustees report that number has fallen by more than half to $36.6 trillion. If the numbers are to be believed, health reform has already saved us $53 trillion — a sum more than three times greater than our entire gross domestic product!

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The New Rules for Insurance Appeals Under PPACA

On July 22, the Obama Administration released interim final rules that allow patient appeals of health insurance coverage decisions as required under the Patient Protection and Affordable Care Act (”PPACA”) and Health Care and Education Reconciliation Act (”Reconciliation Act”).  Published by the departments of Health and Human Services, Treasury, and Labor, these rules create standards for the internal and external processes by which patients can appeal adverse benefits decisions.

Prior to these rules, coverage appeals were governed by contract and State law.  Forty-four States have created some form of external appeal process for insurance coverage decisions; however, their coverage is limited and the processes vary greatly.  Effective January 1, 2003, changes to the Employee Retirement Income Security Act of 1976 (”ERISA”) regulations provided standards for internal appeals processes.  However, these standards only apply to employer-sponsored group health insurance.

As stated in the Obama Administration fact sheet entitled, “Appealing Health Plan Decisions,”

Today, if your health plan tells you it won’t cover a treatment your doctor recommends, or it refuses to pay the bill for your child’s last trip to the emergency room, you may not know where to turn. Most health plans have a process that lets you appeal the decision within the plan through an “internal appeal” — but depending on your State’s laws and your type of coverage, there’s no guarantee that the process will be swift and objective. Moreover, if you lose your internal appeal, you may not be able to ask for an “external appeal” to an independent reviewer.

Internal Appeals Process

Under the rules, new health plans beginning on or after Sept. 23, 2010, must have an internal appeals process for beneficiaries to challenge “adverse benefits decisions” — a “denial, reduction, or termination of, or a failure to provide or make a payment (in whole or in part) for a benefit.”  Such adverse benefits decisions may be based on individual eligibility, benefit coverage, limitations on otherwise covered benefits (such as preexisting condition exclusions, source-of-injury exclusions, and network exclusions), and a determination that a benefit is experimental or not medically necessary.

In addition, health plans must do the following:

  • Notify a claimant of a benefit determination as soon as possible;
  • Provide claimants, free of charge, with the evidence relied upon and the rationale for the decision;
  • Avoid conflicts of interest by making decisions regarding hiring, compensation, termination, and promotion independent of a claims adjustor or medical experts record of denial of benefits; and
  • Meet additional requirements for notice, including information on internal appeals and external review processes.

However, these requirements do not pertain to so-called “grandfathered health plans” — those health plans that were in existence before March 23, 2010 when PPACA was enacted.  In the individual market, health insurance providers must meet the foregoing requirements as well as the following three:

  • Applicants for individual insurance must be allowed to appeal initial eligibility determinations;
  • Internal review must be limited to a single level, allowing claimants to appeal to external or judicial review immediately; and
  • Insurers must maintain all claims and notices for a minimum of six years, which is already required of employer-sponsored health plans under ERISA.

External Appeals Process

If the internal appeal is denied, patients may choose to have the claim reviewed by an independent reviewer.   According to Appealing Health Plan Decisions, States are encouraged to adopt the National Association of Insurance Commissioners (NAIC) standards in “their external appeals laws to adopt these standards before July 1, 2011.”

The NAIC standards call for:

  • External review of plan decisions to deny coverage for care based on medical necessity, appropriateness, health care setting, level of care, or effectiveness of a covered benefit.
  • Clear information for consumers about their right to both internal and external appeals — both in the standard plan materials, and at the time the company denies a claim.
  • Expedited access to external review in some cases — including emergency situations, or cases where their health plan did not follow the rules in the internal appeal.
  • Health plans must pay the cost of the external appeal under State law, and States may not require consumers to pay more than a nominal fee.
  • Review by an independent body assigned by the State. The State must also ensure that the reviewers meet certain standards, keep written records, and are not affected by conflicts of interest.
  • Emergency processes for urgent claims, and a process for experimental or investigational treatment.
  • Final decisions must be binding so, if the consumer wins, the health plan is expected to pay for the benefit that was previously denied.

If State laws don’t meet these standards, consumers in those States will be protected by comparable Federal external appeals standards.

As Kaiser Health News reported, “This is a regulation that benefits everyone — consumers get protections, business and providers get more certainty in the rules and the need for litigation to settle these issues should be dramatically minimized,” Phyllis Borzi, assistant secretary of the Department of Labor, said at a briefing for reporters Thursday.

Consumer Assistance Grants

However, procedural rights for consumers are not sufficient to ensure proper appeals.  “Not enough consumers know this is an option that they have,” said Angel Robinson, the consumer advocate in the Iowa Insurance Division, according to Kaiser Health News.

In addition to the new requirements for internal and external appeals processes under the interim final rules, the federal government is offering nearly $30 million in resources to States and Territories to strengthen and establish consumer assistance programs.  Specifically, these programs are charged with:

  • Helping consumers enroll in health coverage;
  • Helping consumers file complaints and appeals against health plans;
  • Educating consumers about their rights and empowering them to take action; and
  • Tracking consumer complaints to help identify problems and strengthen enforcement.

Katherine Matos is a 3rd year student at Seton Hall Law and a regular blogger at Health Reform Watch.com. [http://www.healthreformwatch.com/] She is the principle inventor on a patent application in the field of medical imaging, resulting from her research as a student at Stevens Institute of Technology. After graduating with degrees in biomedical engineering and history in 2008, she volunteered with the Irish government in the Health Services Executive. At Seton Hall Law, Katherine has researched federal oversight of nanotechnology with Professor Jordan Paradise and non-profit governance with Professor Melanie DiPietro. She worked as a summer associate at Fitzpatrick, Cella, Harper & Scinto in 2009 and at Robinson & Cole in 2010.

A Reply to the Cato Institute

This week, the Cato Institute released a 52-page report on health care reform titled: Bad Medicine: A Guide to the Real Costs and Consequences of the New Health Care Law.

The tract was written by Michael Tanner, a senior fellow at the Institute, and it rests on the thesis that the Patient Protection and Affordable Care Act (ACA) is both Unaffordable and Unfair. Inevitably, Tanner’s claims about affordability are shaky; in truth no one can project how much reform will cost over ten years—and how much it will save. There are too many variables involved. Nevertheless, Tanner seems sure: the legislation will add to the deficit, he asserts, and force insurance premiums higher. Moreover, he stamps the legislation “unjust”: it would turn private insurance companies into regulated “public utilities,” forcing them to insure sick people, while “redistributing income” from families earning “over $348,000” to families earning “$18,000 to $55,000.”  Ultimately, he argues, reform represents yet another step toward turning the U.S. into a “Nanny State.”

Why a 52-page report on health care reform now? Tanner makes his purpose clear in the Introduction where he suggests that conservatives will make the new health care legislation the “centerpiece of Republican campaigns this fall,” as they lobby for repealing the Affordable Care Act, or at the very least, replacing it. Bad Medicine is meant to serve as a playbook for those who hope to kill reform.

With that in mind, The Century Foundation decided that the document deserves scrutiny. In the weeks ahead, I will be analyzing and rebutting the report’s many arguments against individual and employer mandates, insurance regulation, subsidies, reductions in Medicare spending, and the CLASS Act, a much-needed national long-term care program.Continue reading…

If HIT Plan A Doesn’t Work, What’s Plan B?

By VINCE KURAITIS, JD, & DAVID KIBBE, MD

Pop quiz: Among early-stage companies that are successful, what percentage are successful with the initial business model with which they started (Plan A) vs. a secondary business model (Plan B)?

Harvard Business School Professor Clay Christensen studied this issue.  He found that among successful companies, only 7% succeeded with their initial business model, while 93% evolved into a different business model.

So let’s take this finding and reexamine our human nature. In light of these statistics, what makes more sense:

  • Defending Plan A to your dying breath?
  • Assuming Plan A is probably flawed, and anticipating the need for Plan B without getting defensive?

We question many of the assumptions underlying HITECH Plan A. We also want to talk about the need and content for Plan B in a constructive way.Continue reading…

Pitfalls of PPACA – Accountable Care Organizations

In addition to Medicare Advantage payment cuts and potential reductions in fee-for-service payment updates, PPACA includes various provisions intended to facilitate ongoing Medicare cost containment, notably creation of the Independent Payment Advisory Board and the Center for Medicare and Medicaid Innovation. In addition to CMI’s broad scope, PPACA requires specific pilot projects, including (in Section 3022) demonstration of accountable care organizations (ACOs).

What does PPACA mean by an ACO? Dr. Elliott Fisher of Dartmouth Medical School, a primary originator of the concept, defined it as “a provider-led organization whose mission is to manage the full continuum of care and be accountable for the overall costs and quality of care for a defined population” and listed several provider groupings that could form ACOs. PPACA provides additional criteria, including having a formal legal structure and administrative systems, meeting CMS requirements for quality assurance and reporting, and serving at least 5000 Medicare beneficiaries. PPACA also specifies a deadline for the ACO pilot: “Not later than January 1, 2012, the Secretary shall establish…a program…”

The goal of an ACO is to reduce costs and improve quality of care through cooperation and coordination among providers, similar to that achieved by integrated delivery systems like Geisinger, HealthPartners, and Intermountain Health Care, but within what may be essentially a virtual organization superimposed on a loose network of providers and covering only a subset of patients.

Continue reading…

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