A colleague of mine needs someone to help in a consulting gig his organization is doing for a hospital facility management organization. They need someone who understands hospital facility management to guide them in figuring out what the key metrics are, what data the metrics come from, and what the business impact of moving those metrics might be. If that’s you or you know someone who it might be, please *******@*********lt.net“>email me.
Above the Fold
POLICY: Crossing state lines with unaccompanied healthy people
The Kaiser Family Foundation reviews The New Republic’s Jonathan Cohn’s piece (now directly linked)about the Shadegg bill which would allow the purchase of health insurance across state lines. Here’s their description of Jonathan’s piece pulled verbatim:
A bill (HR 2355) that would allow U.S. residents to purchase health insurance in any state serves as a "vivid example" of Republican efforts to provide U.S residents with more "choice," but "what conservatives in this country never mention is that giving us these new choices also means taking something away — typically, programs that make us more secure," Jonathan Cohn, senior editor at the New Republic, writes in an opinion piece. "At first blush," the legislation, sponsored by Rep. John Shadegg (R-Ariz.), "seems utterly sensible," in part because it would allow residents to "shop for insurance the same way they should for consumer goods," Cohn writes. However, he writes, health insurance "isn’t just another sweater you can return to L.L. Bean if it arrives with holes in it," and residents "won’t have somebody to warn them if they are about to purchase a defective policy." Cohn adds that the bill would "flood consumers with new options, overwhelming the regulators, many of whom already feel undermanned in the fight against scam artists." In addition, the legislation would eliminate state regulations that require health insurers to cover "cancer screening, psychiatric treatment and other services that most Americans rightly deem essential," he writes. According to Cohn, the bill would leave some of the sickest residents with "no choices at all" for health insurance, and state high-risk health coverage pools would prove "woefully inadequate" to address their needs. The "best way to fix" the U.S. health insurance system is to "create one big pool of beneficiaries through some kind of universal health insurance system" that would allow residents to select from "well-regulated private health plans" or from all physicians and hospitals under a system that "bypasses insurance companies altogether," Cohn writes. He concludes, "Those aren’t the kind of choices that conservatives want to give Americans, since they happen to require expanding government. But they’re the kind of choices Americans would appreciate the most" (Cohn, The New Republic, 8/22).
Jon hits at the two problems with these bills. a) Fraud and how state insurance departments are relatively helpless/hopeless now — so just wait till they have to try to figure out what’s being sold locally by the bad guys from Topeka (or wherever), and b) (my main bugbear) how those states who do have some minimal attempt at community rating will find those insurance risk pools utterly destroyed when consumers find that they can bay a bare bones plan, which in the small print is licensed in Nevada (or wherever).
The problem of course which John mentions but doesn’t really drill into is how this would turbo-charge underwriting. Only those who pass muster would be accepted by these plans, and if they figure out that you may be sick or ever met a sick person or a doctor before, then you’ve got no chance. Even in guaranteed issue states (like California) health insurers currently can and do medically underwrite you, making premiums for the exact same benefits for people with pre-existing conditions or a history of prior surgery go up by a factor of maybe six and maybe twenty. See here for more evidence about that.
So effectively in Shadegg’s world the individual and small business market would fall into two camps. One for healthy people with high deductible cheap plans that they never use, and one for the sick and increasingly uninsured. And we’re seeing from new data on California out today from UCLA, that even without Shadegg’s help the number of people with employer-based insurance is falling very fast (leaving it to the taxpayer to pick up the pieces).
The only possible stop to this legislation may come from the rest of the health care industry. A health plan that operated within one state and had a hard time moving may not like this bill (or the AHP alternative for small businesses) very much. Some of those health plans are a certain color, and we’ll see how much clout they have with their state’s senators when this bill gets to that august body later in the year. Meanwhile, you know why my credit card can charge me 35% interest despite the fact that California has a law banning "usury"? Well that’s because my credit card comes from the banking mecca of South Dakota. Think about the equivalent of that in health insurance.
CODA: Incidentally, this news service from Kaiser Family Foundation and several like it (including California Health Care Foundation’s) is provided by the The Advisory Board Company. Kind of funny that they’re running a left wing piece, from an editor who’s opinions most of the health care system (i.e. their clients) probably disapproves of, when they have probably made the most pure profit off the current health system of any single firm. But don’t start me on my criticism of "The Grand Alliance" again….and anyway, I guess I have the same issue (without the profit or potential ownership headaches that go with a major league baseball team).
BLOGS/TECH: Quick appeal for tech savvy
This is a quick appeal to my more technically savvy friends about something that REALLY annoys me. Let’s say I’m on a web site and I want it to open another page or save what it’s done (e.g. if I’m writing a post like this using a web based program like Typepad which authors this blog). I, being impatient and being done with that task for now, save it, and wonder off to my Outlook and start say writing an email.
Meanwhile the web site in the background has done its thing (opened, or saved what I wrote, or whatever) but instead of staying in the background it decides to come back into the foreground, meaning often that what I am writing now — in the unconnected email — appears in the web site, or at least does not appear in the email, word document or whatever else I was doing.
And it’s not just the browser (although that’s the most annoying) — Outlook is just as bad. It can take forever for an email to open, or I can open a web site from an email which takes even longer, and it will present it to me in the foreground even though I’m by now onto the next email or doing something else.
So is there any way to STOP functions like that which are running in the background from presenting themselves in the foreground when their task is finished, and for me to be able to go to them at a time of MY choosing not theirs?!
Please make any suggestions in the comments (or ask for more explanation) but this is driving me batshit.
TECH/THE INDUSTRY: Helppie sues ACS
After being booted from his baby Superior only 5 months after selling it to outsourcer ACS, Richard Helppie is claiming that he retired and that he’s not even a little miffed. However, there’s touchy feely niceness and then there’s business. Last week Helppie sued ACS (and Superior) for a chunk of change.
Helppie contends he is owed $770,000 in separation and bonus payments plus stock options under terms of an employment contract in place before ACS bought Superior. In an answer filed Aug. 10, ACS denied the allegations and also filed a counterclaim that said Helppie was awarded a $1.47 million “change of control” payment in exchange for him voiding the employment contract.
Of course, given the amount of red ink that Superior bled for five years from 1999-2004, it’s a wonder that there was a company there to sell to ACS in the first place. I just can’t decide if that was Helppie’s achievement or his fault!
PHYSICIANS: How to easily increase access to care, by Eric Novack
Eric Novack is an orthopedic surgeon who went to medical school in liberal San Francisco, but is now practicing in the red state of Arizona. Eric has been sparring with me and others in the comments on THCB, and also has his own weekly radio show. It’s on a station called "960 The Patriot" — and you can guess that it’s line up is a little different than San Francisco’s 960 The Quake, which is our local Air America affiliate. Eric’s weekly show is very well done, and I recommend that you head over there to take a listen to his archived shows. Some of you might perceive a bias in his guest line-up, and Eric has strong opinions on policy, many of which I do not share. But I’m very hopeful that by encouraging Eric to write for the blog, (and we are also planning some podcast conversations in the near future), we can get to some of the heart of the issues about which we disagree. For his first post, Eric starts simply, with an idea to get physicians to provide more uncompensated care.
In what I hope is the first of many posts for THCB, I propose a simple step to increase access to care. The number of uninsured is large. Depending upon your perspective, the number can be as low as around 20 million Americans or as high as 45 million. Of course, you can find those who claim a number larger or smaller. It is a great bit of semantic legerdemain to equate lack of insurance with lack of access to health care. Stating "no access" implies that no care is available and that the government has "abandoned" this group. This is simply not true.
Congress passed a law in 1986 called Emergency Medical Treatment and Active Labor Act" or EMTALA. EMTALA has a variety of provisions but can be simply stated that persons who come to emergency departments cannot be turned away because of an inability to pay. This applies to the hospital emergency department (ED), the emergency room physicians, and the specialists and internal medicine doctors "on-call" for the emergency department. "Emergency" for the purposes of the emergency room is anyone who comes to the hospital– the hospital cannot say– "it is just a cold, so we will not treat you". If someone breaks a leg and an orthopedic surgeon is on call to cover the ED, the surgeon must take care of the problem and the patient including the operation and all appropriate follow-up care.
One of the many problems is that all of this uncompensated care falls back on the doctors– remember that many hospitals are non-profit or have received federal funds that require them to provide a certain amount of uncompensated care.
Let me give an example, (any similarity to any real patient of mine is coincidental…). I am on call for "Arizona Hospital". Bill Jones is brought to the hospital after a fall from his ladder at home, where he was taking down his Christmas lights (it is never too late, is it?). I am called by the ED because Mr. Jones has broken his femur (thigh bone). I see the patient in the ED, he is admitted, and I operate on him at midnight. I finish surgery, the paperwork, and head home around 2:30 AM. I then see Mr. J for the next 3 days after clinic. After discharge, Mr. J comes to the clinic regularly over the next several months for checks and x-rays and advice and guidance. Total charges for all the work, time, expertise, and liability risk is $5000.
Mr. Jones has his own landscaping business. He has no insurance. He never pays a bill. I cannot abandon his care– it is unethical and against the law (abandonment). I get tired of this happening and stop taking call at the hospital. Losers in this scenario–the physician, the hospital (less coverage), and future patients–insured or not- who would benefit from my expertise.
Here is a partial solution– but first, a brief preamble. Health care system transformation will need to be incremental, not revolutionary– otherwise, the kind of horse-trading and compromises that resulted in the bloated, inefficient, restrictive system of Medicare result.
Here’s the partial solution. Guess what happens at the end of the year when I file my taxes? Can I deduct the $5000 in bad debt as a "business loss"? No. By simply allowing physicians to credit bad medical debt from their income (like other businesses can with losses related to products, etc.), physicians would be have a huge incentive to provide a certain amount of care to the poor. It needs to be a credit and not a deduction as a deduction would return only 35 cents on the dollar at best. So, there it is– tax relief to the providers of care for the amount of "free care" provided.
No new bureaucracy. Incentives, not punishment
For some more info on EMTALA see this lawyer’s site.
PHYSICIANS: Physician entrepreneurship
And in just one tiny example of physician entrepreneurship, the LA Times reports on a new bill to close a loophole in California Workers’ Comp law. The Workers Comp problem is one of those perennial problems here in California, where we have too many doctors and too many lawyers, and they are able to hone their skills in separating the insurers from their money. It was "fixed" by Pete Wilson in the early 1990s, and then "fixed" again last year by Arnie. The latest round seems to have done some good, but one little loophole has been exploited allegedly to the tune of $250m.
The loophole is that pharmacy prices for drugs were capped in the law, but prices for those drugs dispensed directly by doctors were not. Well you know what’s coming next. Physicians were enticed by some wholesalers to start prescribing and dispensing drugs, and their mark-ups are a factor of three to ten what the pharmacies can charge. And it’s all paid for by the insurers. Here are some pricing examples from a Rand study quoted in the LA Times.
Pharmacy price vs. Doctor’s office priceSoma $44.68 vs $396.98Prozac $14.81 vs $131.82Darvocet $12.65 vs $58.31Acetaminophen/Hydrocodone $12.81 vs $58.31
Even the unions are opposed to this, as they correctly see this type of lilly-gilding as being the kind of thing that might lead to another round of attacks on employee benefits. The employers are of course siding with them.
But it does just show you that in American health care, if there’s a way to bill an extra buck or two, physicians are as quick as anyone else to figure out how. I don’t need to tell you the California Medical Association’s position on the bill…..
INDUSTRY: What would you read?
So I got an email from a student asking for a basic primer on the US Healthcare system. He’s at Northwestern, so I might recommend him Edward FX Hughes as a go to guy. But my two favorite books about health care are The Social Transformation of American Medicine (by Paul Starr) and Demanding Medical Excellence (by Michael Millenson). Neither are exactly beginner material. I was originally quite taken 15 years ago with Joe Califano’s America’s Health Care Revolution, but that’s pretty dated now.
Given that I haven’t written the definitive work myself, and that Jon Cohn hasn’t finished his book yet, what would you suggest as a great introduction? (Yup, this is an open thread…). And are there millions of students just waiting to buy such a book if I write one? (Publishers wishing to send advances, please email me!!)
POLICY/BLOGS: Interesting Mass. policy by Abby, and new blog
Promoted from the comments, regular contributor Abby writes an interesting piece about the movement in Massachusetts to get to universal insurance there via some kind of Medicaid expansion coupled with pay or play. Meanwhile definitely check out the blog written by the guy behind the Health Care for All coalition in the Bay State…..and I know what you’re thinking — they got the Superbowl Champs and the World Series winners, why should they get any more favors:
What Mitt Romney advocates is barely relevant to the debate in Massachusetts. There’s a veto-proof Democratic majority in both houses, and it looks like Romney won’t be running for re-election. He hasn’t officially announced anything yet, but he did write an op-ed saying that he thought that Roe v. Wade should go and abortion policy should be returned to the states. Hardly a popular position in Massachusetts. I haven’t heard much from Romney advocating for Medicaid expansion. His current thing is to require people to buy stripped-down policies.
There is a coalition of groups called MassAct which is trying to expand MassHealth considerably. They are hoping to get the legislature to act, but they are organizing behind a ballot initiative. There are 4 proposals on the table.
Their goals are
*Expanded coverage for low-income individuals and families through MassHealth.*Providing assistance to middle income, working individuals and families to purchase insurance.*Offering assistance to small businesses to help them pay the premiums for their employees.*Requiring employers to either provide health coverage or pay a fee to the state.*Creating a new state quality/cost leadership council
The pay or play thing could be challenged under ERISA, but they are structuring it as a rebate for spending on healthcare, and businesses with annual payroll less than $50K are exempt. They plan to pay for this through the employer assessment and by raising the cigarette tax.
There is some talk of cutting the free care pool assessment on suburban hospitals to get them behind it. They also want to raise the reimbursement rates. The thinking is that the private patients are covering the cost of current MassHealth patients, and that this is driving up the private insurance rates forcing more people into uninsurance.
POLICY: While we’re on the subject of Medicaid
Modern Physician reports that HHS is getting serious about cutting off those "accounting games" that enable states like New York (but by no means only New York) to get so much extra cash out of Medicaid. While this might be a great idea in theory, you can expect that Congressional delegations from several states, not to mention the Governors, will go ballistic when they figure out what that might mean for their budgets. It’s tantamount to going to the block grant proposal that we’ve heard before, and that was discussed on THCB on Inauguration day, which now seems quite a while back.
POLICY: Medicaid as the route to universal insurance?
During the Dolphin Group webinar I was presenting on today, I was asked if Medicaid would become a communal buying pool that would solve the unisurance problem. I rather fliply dismissed the idea, and Scott Tiazkun, healthcare analyst, IDC Research mentioned that something like that was going on in Massachusetts. Now there have been local changes in how many people Medicaid covers — for instance Tennessee put almost all its uninsured into Medicaid in the mid 1990s and more recently threw most out, and Utah changed the way it paid for Medicaid and enrolled more people — but we’re nowhere near the Clinton plan of putting all of Medicaid, all the uninsured and most small business employees in big buying pools. So I felt fairly safe saying what I said, but I also wasn’t exactly working from the latest data in my head. (Remember this was a webinar about health plan web strategies!)
To be honest I knew that Medicaid had picked up its enrollment relative to private payers in recent years — particularly in the recent recession, and as I really hadn’t looked much at this recently, I spent a bit of time today digging. What I did know is that the restrictions on Medicaid eligibility were greatly slackened at the end of the first Bush Administration and (from memory) the numbers on Medicaid went from the mid-20 millions in 1989 to nearer 35 million in the mid 1990s (with most of the rise during to the 1990-2 recession). Then under the SCHIP (health insurance for children) program in the mid-to late 1990s, another several million kids were put into Medicaid. Now some 5 million of that 35 million were dual eligibles (poor seniors on Medicaid and Medicare) and were double counted, but nevertheless the number of Medicaid recipients has gone up quite a bit. USA today reported last week (chart lifted from their site) that the number went from 34 million in 1999 to 47 million this year.
The reason they gave in a companion article was that because welfare had essentially been abolished back in 1996, states no longer gave Medicaid only to AFDC recipients, but now have the freedom to base eligibility on income. And although eligibility has toughened up and rolls have been cut somewhat in most places during the most recent recession, in general states are getting more relaxed about eligibility requirements and some states such as Minnesota and Massachusetts are actually trying to add to their rolls.
I went to look at my estimates for the IFTF/RWJ 1997 Ten Year Forecast and I then estimated mostly just on population growth that by 2006 some 35m would be on Medicaid (which equates to 40-42m if you count in the dual eligibles). So things have progressed faster than I thought. The Center for Health System Change reported that despite a rise in the number of Americans getting employment based-insurance in the boom times, that number fell from 67% of the under-65 population in 2001 to 63% in 2003, and that most of that decline was replaced by people moving into Medicaid, although the number of uninsured did rise slightly too. Clearly at the margin Medicaid is replacing employer-based insurance. But have the numbers within Medicaid really gone up quite so much?
Using some data from 1993 that CMS has available, it looks as though some 5 million children got into Medicaid (or separate but equal SCHIP programs) between 1998 and 2003, and this seems equivalent to the data that HSC used in its study. Kaiser Family Foundation (which is a wealth of information about Medicaid) in a January 2005 fact sheet said that in 2003 Medicaid covered 25 million children, 14 million adults (primarily low-income working parents), 5 million seniors and 8 million persons with disabilities. That gets us to a total of 53 million, or 48 million not counting the seniors (who are dual eligible). CMS said in 2004 using FY 2001 data that 46 million people received Medicaid services. But CMS says in another data sheet that in 2004 there are 42 million enrollees and 52 million beneficiaries. A beneficiary is someone who receives a (payment for a) service from Medicaid. Now we are getting somewhere near the nub of the issue, in that people go in and out of Medicaid often on a monthly basis.
My assumption is that the "snapshot" is the 42 million, which seems much lower than the 47 million that USA Today reports citing CMS data that I cannot find on their web site. So I suspect (but please if you know I’m wrong email me) that the USA Today number is the 42 million plus some 5 million dual eligibles (although KFF says that the number of dual eligibles is now 7 million in this recent factsheet). So overall counting Medicaid enrollement is very hard to do, as you are counting several moving targets, and it’s a question of definition.
But what Scott said this morning was that Massachusetts was looking at Medicaid as becoming a way to provide universal health insurance.
And judging by this article in the Boston Globe, that’s what Mitt Romney, (who is the guy who made me wait 2 hours to get into the Ski Jumping at the 2002 Winter Olympics, and incidentally) the Governor of Massachusetts, is saying he’s aiming for. Enrollement went from under 700,000 in 1997 to nearly 1,000,000 in 2002, back down to nearer 900,000 in 2003 and is now moving back up near to 1,000,000.
However, this is all a long way from saying that Medicaid is going to be the cure for uninsurance. There are two main reasons why.
First, most of the people going into Medicaid are effectively leaving employer-based insurance rather than moving from being uninsured to having Medicaid. Of course there may be people moving from being uninsured into Medicaid as featured in the USA Today story, but overall their places in the ranks of the uninsured (which is itself an extremely fluid population) are being taken by an equivalent amount of people losing employer-based insurance. So the overall number of uninsured is not being changed by this increase in Medicaid enrollment, other than the uninsured number would be much higher than the current 45 million (snapshot), had it not happened.
The second reason is the relative makeup of Medicaid and the uninsured. KFF also has a great fact sheet on the unisured. Only 20% or 9 million of the 45 million uninsured are children, leaving 36 million adults, of whom 80% are in some type of work, or have a family member working. Medicaid now only covers 14 million adults. That means that Medicaid would have to double enrollment overall and nearly quadruple it amongst low-income adults to get rid of the uninsured, and given that half of those uninsured adults are over 35 and thus somewhat expensive, that would cost plenty.
This is just not going to happen in the current fiscal and political environment. So even though getting some of the working poor onto Medicaid is a good thing, it’s disingenous to say that Medicaid is going to be the solution to the uninsurance problem.
What we should so with the Medicaid population is move it en masse into some type of universal insurance pool, with the uninsured, and a bunch of other people. But no one in Congress with any clout is going to be touching that with a ten-foot pole, and while Bush has noticed that health care is an issue, we all know this his "solutions" aren’t.
