Showing posts with label Health insurance. Show all posts
Showing posts with label Health insurance. Show all posts

Thursday, November 14, 2024

Health Affairs: "The Impact Of The Election On Health Policy And The Courts"

The nonpartisan and highly respected journal, Health Affairs, today posted an analysis of some of the more conspicuous (and worrying) changes to the health care scene we might expect to see once Donald Trump's administration is in place. It is, as usual, well worth reading in whole.

The areas that are discussed include:

  • the Affordable Care Act (ACA) (primary concern: allowing premium tax credit enhancements to expire entirely after 2025, which could result in 4 million people losing their health insurance coverage; also -- whether by statute, agency regulation, or executive order -- any number of the ACA's protections are at risk)
  • Medicaid (during the campaign Trump vowed to leave Social Security and Medicare alone; "experts noted that Medicaid was conspicuously absent from the conversation")
  • reproductive health care (abortion, LGBTQ nondiscrimination, reviving the Comstock Act, changing the Administration's position in state and federal lawsuits)
  • nondiscrimination and health equity ("Health care is a civil rights issue. . . . Anti-discrimination protections in health are also likely to suffer major blows going forward."
  • Medicare Drug Negotiation Program (hard to believe that a program that will save the government and citizens billions will be watered down, but Big Pharma has hated this law from the beginning and it has some attentive allies in the new administration)
  • public health (RFK, Jr. -- need I say more? He was named as Trump's nominee for Secretary of HHS; the mind reels)
  • the courts (Yup. From the Supreme Court on down, expect change)
The end. (Take that any way you want.)

Wednesday, October 30, 2024

More on Health Care and the Election

Yesterday I posted Drew Altman's view of the health care issues that are most likely to be affected by the outcome of next Tuesday's presidential (and to a lesser extent congressional) election. Today I am featuring a *small* sampling of the commentary available from reliable sources.

  • Larry Levitt is the chief policy guy at the nonpartisan Kaiser Family Foundation, one of the most reliable sources of data and analysis around. In 2013 he wrote in JAMA that "this may be the first presidential election since 2008 when health reform and the ACA—or repeal of the ACA—are not front and center." Just about everything Levitt discussed in this early-campaign essay continues to ring true.
  • CBS News (Oct. 30): Where are the candidates on health care isssues
    • Harris has backed away from single-payer health care
    • Trump says he has "concepts" of a health care plan 
    • Harris wants to continue Biden's crackdown on pharmaceutical companies
    • Trump says he wants to mandate IVF coverage, but Republicans in Congress aren't so keen
  • NPR (Oct. 28): The top three issues in the presidential race
    • The future of Medicare’s drug price negotiations
    • The Affordable Care Act’s enhanced subsidies
    • Continued availability of medication abortion
  • NY Times (Oct. 28; paywall): The 2024 Stakes on Health Care
    • Insurance: ACA subsidies are due to expire, leaving 3 million without health coverage
    • Drug prices: the candidates agree that we pay too much, but not on the role of the president
    • Medicare/Medicaid: both agree that benefits shouldn't be cut
    • Bottom line: "Kamala Harris has offered policies that would lower out-of-pocket costs for many Americans and preserve or expand health insurance coverage. Donald Trump has been vaguer, and his agenda is a little harder to predict."
  • ABC News (Oct. 25): Presidential election puts Affordable Care Act back in the bull's-eye
    • Subsidies, risk pools, pre-exisiting condition coverage, Medicaid expansion under the ACA
  • And wait, there's more!

Toddler's Snake Bite Costs $290K+ to Treat

Two-year-old Brigland Pfeffer was playing with his sibs in their San Diego backyard when he was bitten by a rattlesnake. Ouch! His was one of the 7,000-8,000 venomous snakebites that occur in the U.S. each year. The N.Y. Times reported a surge in the venomous snake population in Southern California 18 years ago, and 20% of all such snakebites occur in that state. So young Brigland's close encounter may have been a surprise, but it was far from a shock.

The shock came when the bills for Brigland's treatment started rolling in. As reported by Kaiser Family Foundation in this morning's on-line Health News, the final bills totaled "$297,461, which included two ambulance rides, an emergency room visit, and a couple of days in pediatric intensive care. Antivenom alone accounts for $213,278.80 of the total bill."

Despite the 2021 passage of the No Surprises Act, there are a few surprises in the final bills:

  • The Pfeffer's health insurer paid a large chunk of these bills, but refused payment of a second ambulance ride that took Brigland from Palomar Health's ER Rady Children's Hospital where he was admitted to the pediatric ICU:
Pfeffer said she received a letter this summer indicating they owe an additional $11,300 for Brigland’s care. While the landmark No Surprises Act protects patients from many out-of-network bills in emergencies, the law controversially exempted bills for ground ambulances.

  • Experts who reviewed the hospitals' bills described the charges for antivenom "eye-popping." The "Freakonomics" podcast ran a story on the high costs for antivenom in July of this year. KFF's report provides a useful summary of the story behind the charges. The first clue is in the two hospitals' different charges per vial of the serum:

Palomar [Medical Center Escondido], where emergency staffers treated Brigland, charged $9,574.60 per vial, for a total of $95,746 for the starting dose of 10 vials of Anavip.

Rady, the largest children’s hospital on the West Coast, charged $5,876.64 for each vial. For the 20 vials Brigland received there, the total was $117,532.80. [emphasis added]

What explains the difference?

One explanation is that hospitals mark up products to balance overhead costs and generate revenue. . . . 

 For instance, Medicare . . . pays about $2,000 for a vial of [the antivenom] Anavip . On average . . . that is the price hospitals pay for it.

Leslie Boyer, a doctor and toxicology researcher, helped found a group that was instrumental in developing Anavip, as well as the other available snake antivenom, CroFab, which dominated the market for decades. In 2015, she published an editorial in the American Journal of Medicine breaking down the “true” cost of antivenom

Boyer's editorial is well worth reading.

Using cost data collected from factory supervisors, animal managers, hospital pharmacists and other sources, Boyer developed a model for a hypothetical antivenom, at a final cost of $14,624 per vial. She found the cost of venom, included in that total, was just 2 cents. Manufacturing accounted for $9 of the $14,624 total. [emphasis added]

More than 70% of the price tag — $10,250 — is attributable to hospital markups, her research showed. 

 And then there's the surcharge for legal expenses:

Anavip entered the market in 2018 as the only competitor to CroFab. But its makers settled a patent infringement lawsuit with CroFab’s maker, requiring the makers of Anavip to pay royalties until 2028.

Anavip debuted at a retail price of $1,220 per vial. Boyer noted that the price later rose to cover the manufacturers’ millions of dollars in legal costs. 

The reporting on snake antivenom -- from manufacture to treatment to the inevitable legal costs -- gives us a snapshot of the best and the worst features of our healthcare system. 

  1. Best. Brigland's hand, arm, and possibly life were saved because a relatively rare medication was available at two local hospitals, including a pediatric facility, via a healthcare infrastructure (including 9-1-1, emergency transportation with a treatment team on-board). We have a healthcare delivery system (for those who can acess it) that is among the best in the world [cite].
  2. Not the best. Many if not most rattlesnake bites occur in rural settings far from the world-class doctors and hospitals in a city like San Diego. In a word, the excellence we are so proud of (and pay so much to maintain) is, in geographical terms, spotty.
  3. Worst. The cost of Brigland's treatment exceeded the median price of a home in 16 states and was close to the median home price in 5 or 6 more. Most of that was for the antivenom medication and most of the charge for that was due to hospital mark-ups. As one commenter told KFF, hospital charges -- thousands of which reside in their chargemasters -- are largely fictitious and are neither regulated nor controlled by any public or private body. As the National Academy for State Healthcare Policy blogged in 2020:

[T]he chargemaster rates hospitals use are nearly meaningless*. . . . 

Hospital chargemaster rates are the equivalent of Manufacturers Suggested Retail Price or MSRP in car buying markets. They are little more than the price a seller would ideally like to charge a consumer. Hospitals set their own chargemaster rates – there is no legal requirement or set formula a hospital must follow when establishing the basis between chargemaster rates and costs. As a result, chargemaster rates are unlikely to be accurate reflections of actual hospital expenses.
Recently, The Montana Office of the Commissioner of Securities and Insurance examined the ratio between 10 acute hospitals’ expenses and chargemaster rates.
The state concluded that what the hospitals listed as chargemaster rates for all payers would cover between 192 to 384 percent of the hospitals’ actual costs.
A hospital may also change chargemaster rates at any time – prior notification is not always required – and mark-ups on hospital-purchased services and supplies like durable medical equipment are not disclosed. All of these features make it difficult for public and private payers to use chargemaster rates as a way to establish relevant prices to pay to hospitals. Hospitals instead negotiate discounts off their chargemaster rates with individual and group plans.
In fact, almost no one actually pays the publicized chargemaster rates. The vast majority of health care consumers are represented by a payer of some kind, such as a commercial health insurance company, Medicaid, or Medicare. Commercial insurers negotiate the actual prices they pay during the process of contracting with providers. Medicare and Medicaid establish their own payment levels independent of hospitals’ chargemaster lists – Medicare through the federal government and Medicaid through state governments.

* But chargemaster prices aren't entirely meaningless: 

The cruel irony of the chargemaster is that the uninsured are the most likely to be billed chargemaster rates because they are not represented by a payer. 

Our healthcare "system," which daily provides the kind of excellent care Brigland received, seems to thrive on financial chaos. Despite the No Surprises Act, the costs of care are higher than any other industrialized country, often unpredictable, subject to substantial variations from institution to institution even within a single city, and frequently unfair. 

For Brigland's parents, this episode of care cost them $7,200 (their out-of-pocket maximum) plus $11,300 for that second ambulance ride that their insurer refused to pay. One not-so-minor irony: At the end of the transcript of the Freakonomics podcast about the high cost of antivenom, there was one comment. It ended with this sentence: "Oh, and if you get bitten in Australia, anti-venom is free because we have universal health care! :-)" Ouch, indeed.

Tuesday, October 01, 2024

Health Care Policy and the 2024 Election

The presidential campaign hasn't been much about health law, and up to two-thirds of adults are concerned about the lack of discussion. Perhaps to remedy this situation -- or to keep the candidates honest if and when they deign to discuss health care -- the nonpartisan Kaiser Family Foundation (KFF) has just posted a new tool; here's their announcement:

A new KFF tool generates data-driven fact sheets that lay out the health care landscape in every state against the backdrop of the 2024 election.

These state “snapshots” provide information on a variety of health care topics that may be the focus of campaign and policy debates. Topics include

  • health costs; 
  • medical debt;
  •  women’s health policy, including state abortion, contraception and maternity laws and policies;
  •  health coverage, including the Affordable Care Act, Medicare and prescription drug coverage, Medicaid, and employer-sponsored insurance;
  •  gender affirming care; and
  •  basic information on health status, population and income. 

The new tool is part of KFF’s broader collection of Election 2024-related resources, including our side-by-side comparison of the candidates’ positions and records on health policy issues. 

Other election-related features include:

Wednesday, March 20, 2024

Prior Authorization & Your Health Insurer

Once upon a time, the way health insurance worked was this: Patients with insurance were seen by their doctors, received prescriptions for medications, and got the surgeries and other procedures their doctors believed were justified. Under these "indemnity plans," after the fact, invoices were submitted to health insurance companies, and -- by and large -- the invoices were paid. Not necessarily in full -- there were deductibles that needed to be met each year and reductions in "reimbursement" for the patient's co-pay or co-insurance obligation. But coverage was seldom an issue. Insurance companies conducted retroactive reviews to determine that the service or item was "medically necessary and appropriate," but most claims for payment were approved most of the time.

Until they weren't.

As new technologies and high-priced drugs and devices drove up the cost of health care, insurers looked for ways to control the amounts they paid out in claims. Under the broad banner of "managed care," insurers instituted various reforms that fundamentally changed the delivery of health care goods and services. 

One reform was to create panels or networks of approved providers, in exchange for which the insurance companies demanded deep discounts in physicians' fees and hospitals' charges. Patients who received their care -- even emergency care -- from providers who were "out of network" typically received no coverage for that care or reduced coverage, putting more of the cost of care on patients (i.e., the insurers' customers). 

Another reform was the integration of health insurance and healthcare provider. The purest form of this were the HMOs. Some provided health care services to their insureds; others contracted with providers to diagnose and treat their insureds. In both instances, a single entity was financially (and legally and ethically) obligated to write health insurance policies and provide care (either directly or indirectly) to their insureds.

A third reform relates to the title of this post: prior authorization, to which I would add concurrent authorization. "Prior authorization" gives the insurance company up-front veto power over referrals to specialists or for hospitalizations, for prescriptions for drugs and devices,  and for procedures (diagnostic (CT scans, e.g.) or treatment (including surgeries). "Concurrent authorization" gives insurance companies the same type of veto power throughout a course of treatment. This might be denial of a request for an MRI to see whether or how much a disease has progressed or denial of a request for an additional number of days of hospitalization to deal with post-procedure complications. And "retroactive review" -- which, under indemnity plans, were relatively benign efforts to determine medical appropriateness and necessity -- became a more rigorous process of "retroactive authorization."

Although managed care was originally justified as a necessary form of cost control, including screening insurance claims for those that were not for medically necessary appropriate care, managed care itself evolved into something that was increasingly regarded as abusive. The pattern of denying coverage for unarguably necessary and appropriate care produced a backlash over the past two decades, including legislative and regulatory reforms at the federal and state level to address the worst features of managed care.

A recent opinion video on the New York Times website (Mar. 14, 2024; subject to paywall) provides excellent evidence that insurance companies continue to use prior and concurrent authorizations to to delay or avoid altogether their contractual obligation to pay for care that is necessary and appropriate. (I can provide free access to eights readers of this post; if you want access, just let me know at tmayo@smu.edu.)

A handful of states have passed "gold card" laws that are intended to allow physicians who have successfully received prior authorizations to bypass that process altogether. According to the Texas Medical Association, two years after passage of the state's "gold card" law, "the Texas Department of Insurance (TDI) reports that only 3% of physicians and health care professionals have received gold cards because of the current eligibility threshold, which requires physicians to submit a minimum of five eligible prior authorization requests for a given health care service or medication within the six-month review period."

A federal version of the gold card law -- H.R. 4968, "Getting Over Lengthy Delays in Care As Required by Doctors Act of 2023" (or the "GOLD CARD Act of 2023") -- was referred last July 23 to the Subcommittee on Health of the House Ways and Means Committee, where it remains to this day. Even if it becomes law, exempts physicians from prior authorization requirements only under Medicare Advantage plans with respect to specific items and services if at least 90% of the physician's requests for such items and services were approved during the previous plan year. Outside of Medicare, patients and their providers would not be helped by the GOLD CARD Act.

Tuesday, March 12, 2024

"Automatic Enrollment in Health Insurance" (Commonwealth Fund Report)

The Commonwealth Fund just published "Automatic Enrollment in Health Insurance: A Pathway to Increased Coverage for People with Low Income" (March 11, 2023) by John Holahan, Michael Simpson, and Jason Levitis. By way of introduction, the Commonwealth Fund writes: "The number of uninsured Americans — more than 26 million — remains stubbornly high, despite the availability of free or low-cost health coverage to those with low incomes. But there is a pathway to coverage that could have a substantial impact on the uninsured rate: automatically enrolling people who qualify for no-cost coverage in either Medicaid or marketplace plans." 

The basic model would expand upon existing law in a bold way:

The Inflation Reduction Act of 2022 eliminated marketplace premiums for eligible people with incomes below 150 percent of FPL. As a result, all individuals at that income level who live in states that have expanded Medicaid can now receive zero-premium coverage, unless they have an “affordable” offer from an employer or are excluded because of immigration status. If the remaining 10 states expanded Medicaid, or if eligible people with incomes below 100 percent of FPL in nonexpansion states were permitted to have subsidized coverage in the marketplace, then most legal residents with incomes below 150 percent of FPL could be covered with no premiums. Zero-premium coverage could also be extended to higher incomes, either through further enhancement of federal premium tax credits or by states adopting a Basic Health Program or adding state premium subsidies. [footnotes omitted]

Here's the Abstract:

Issue: The number of uninsured Americans remains stubbornly high, and many Americans do not obtain the coverage for which they are eligible — even when insurance is free.

Goal: To outline a system for automatically enrolling people with low incomes in health coverage and then model the impact on coverage and spending at the federal and state levels.

Methods: The Urban Institute’s Health Insurance Policy Simulation Model was used to analyze alternative auto-enrollment approaches. These include identifying uninsured individuals who are tax filers or recipients of the Supplemental Nutrition Assistance Program (SNAP), unemployment insurance, or Social Security and enrolling people who are eligible for free coverage.

Key Findings and Conclusions: We show results for the nation and for three states (California, Georgia, and Michigan). If all states adopted an auto-enrollment policy for those with incomes at or below 150 percent of the federal poverty level, 4.3 million uninsured people would be identified and enrolled. An additional 1.8 million would be “deemed” covered, either auto-enrolled through provider contact or contingently covered and thus protected from huge medical bills. Provider spending on uncompensated care would fall 32 percent, while federal spending would increase by $30.3 billion and state spending would increase by $7.7 billion per year.

The report discusses two implementation models: nationwide enrollment pursuant to federal legislation or, absent that, state-by-state legislative implementation. 

It's hard to imagine either model would escape contentious litigation lasting years. Recall Chief Justice Roberts's opinion in the 2012 case of Sebelius v. NFIB, in which the individual mandate was deemed to exceed Congress's powers under the Commerce Clause: 
The individual mandate, however, does not regulate existing commercial activity. It instead compels individuals to become active in commerce by purchasing a product, on the ground that their failure to do so affects interstate commerce. Construing the Commerce Clause to permit Congress to regulate individuals precisely because they are doing nothing would open a new and potentially vast do-main to congressional authority.

Make a change to these sentences and you have the essence of the brief we can expect from opponents of automatic enrollment:

The individual mandate, however, does not regulate existing commercial activity. It instead compels individuals to become active in commerce by enrolling them in a product, on the ground that their failure to do so affects interstate commerce. Construing the Commerce Clause to permit Congress to regulate individuals precisely because they are doing nothing would open a new and potentially vast do-main to congressional authority. 

In Sebelius Roberts saved the individual mandate by characterizing the penalty for not purchasing health care coverage as a tax. It would be a real stretch to characterize a free insurance policy as an exercise of the Taxing Clause. Would it fly under the Spending Clause? 

By way of counter-argument, don't we already have a nationwide automatic-enrollment scheme for Medicare Part A? Would a broader scheme be any different?

Friday, March 08, 2024

Biden's State of the Union Address: 13 Health Care Take-aways

Becker's Hospital Review takes a look at "13 healthcare takeaways" from President Biden's State of the Union address last evening. They include:


  1. Expanding Medicare's drug price negotiation scope
  2. Limiting drug costs
  3. Expanding rebate requirement
  4. Closing Medicaid coverage gap [for 10 states, including Texas, that haven't expanded eligibility]
  5. Capping the cost of insulin
  6. Abortion access
  7. COVID-19
  8. Affordable Care Act
  9. Women's health
  10. Taxes
  11. Gun violence
  12. PACT Act [Resources for Veterans]
  13. ARPA-H (Advanced Research Projects Agency for Health ) 

Tuesday, February 20, 2024

Out-of-Pocket Costs Are Top of the List of Voters' Concerns

Money's tight. Inflation seems to be stuck at a level that bothers voters -- R, D, and Ind alike. Worries that the Fed may back off a notch or two in its current rate-reduction program seems to have spooked the equities markets, and that's an unsettling development to tens of millions of workers and retirees whose retirement plans are in managed stock portfolios. 

Add to all this a broadly shared view that out-of-pocket expenditures for health care are too high, according to polling done by the nonpartisan Kaiser Family Foundation. When registered voters were asked about their health-care concerns, these payments -- copays, coinsurance, deductibles -- were #1 by a lot:


This concern was shared across the political spectrum. As the KFF folks put it: 
What this means is that affordability is now the theme that will resonate most with voters, whether candidates are talking about health on the campaign trail, or policymakers are advancing policy proposals. That doesn’t mean that other themes like “universal coverage” or health care as a “right” (if you lean liberal), or “choice” or “competition” (if you lean more conservative), don’t work with large segments of the population. But with 92% of the population now covered and so many people struggling with medical bills and medical debt, affordability is the big tent theme that will connect with the most Americans.  

Reproductive rights will motivate large groups of voters to go to the poll. The issue polls well with Democrats, independents, and college-educated women, among others. It appeared to have an effect in 2023 elections, but its impact on 2024 remains to be seen. 

To be clear, affordability of health care isn't simply a political issue. It has huge implications for access to health care, even among the 92% of Americans who have health insurance coverage, at least to the extent health care is postponed or not sought at all because of high cost-sharing obligations. Also, when care is postponed or passed up, that has an impact on quality of care, and reduced access and quality affect societal concerns with the justice and fairness of the health care delivery system that continues to price millions of covered individuals out of the market. 

Monday, October 30, 2023

When Your "Free" Annual Check-up Isn't Free

A good reminder from the Kaiser Family Foundation (and broadcast on NPR's "Morning Edition" today: The ACA requires that insurers pay for an annual physical with no out-of-pocket payment by the insured patient, but that doesn't cover "extra" services that are offered during the same visit.

What's "extra." Like so much in health care, it depends.

One patient, Christine Rogers, answered her doctor's screening questionnaire honestly when it asked about depression. Her mother had unexpectedly died in a nursing home 13 hours away, and she answered the questionnaire with "It was a horrible year. I lost my mom." That triggered a 5-minute conversation about depression and an additional charge - not covered by her insurer - of $76.06.

Ms. Rogers felt a bit betrayed by a screening process that depends upon honest answers to questions about a patient's physical and emotional condition and then adds to her bill at the rate of $912.72 an hour.

The hospital and physician group stood behind the charge but -- perhaps to avoid being highlighted by KFF and NPR -- wrote off the extra charge.

The take-away: The ACA guarantees you one free physical per year, but what's included in that free service may vary from provider to provider, with precious little guidance to constrain billing practices.

Caveat emptor, indeed.


Tuesday, August 15, 2023

Health Insurers' Tactic Resurfaces With a Vengeance: Deny, Deny, Deny

I once had a Health Law student who had been an HMO employee in a previous life. She was the one who answered the phone when a provider (hospital, clinic, physician, etc.) dialed 1-800 for pre-authorization for a procedure, hospitalization, or prescription item (medication, wheelchair, PT, etc.). Her standing order was simple: Always deny the request first time around. In Texas, we call that "bad faith claims handling" and it's a tort that can result in compensatory and punitive damages. So much for the deterrence effect of tort law!

A lot has changed in health care in the intervening two decades, byt "deny, deny, deny" is still with us. It's frustrating for policy holders (a/k/a patients and human beings), and it's aggravating for the providers. It's also a form of Russian roulette that results in dangerous delays in providing needed health care goods and services.

A recent article in Becker's CFO Report (Aug. 14, 2023) highlights the problem. As described by a hospital CEO with 37 years of experience in health care, bare-knuckle negotiations over reimbursement rates get all the media attention when providers and a payor appear to be at impasse and termination of the contract is a looming reality for thousands of patients whose providers are about to be "out of network." Reimbursement rates are the "above the surface" story in these negotiations, but eventually both sides compromise and crisis is averted.

The "below the surface" issues, though, have an outsized effect on providers. These issues stem from denials of payment for any of the myriad reasons insurers can cite: service or medication not covered, no pre-authorization or referral from a gatekeeper, DRG down-coding, difference in clinical judgment about medical necessity . . . . The list goes on. Here's the eye-popping heart of the article:

Data and numbers on denial rates are not easy to find, but some examination paints a picture rich with variation. An analysis of 2021 plans on Healthcare.gov conducted by KFF found nearly 17 percent of in-network claims were denied, with rates varying from 2 percent to 49 percent. The reasons for the bulk of denials are unclear. About 14 percent were attributed to an excluded service, 8 percent to lack of pre-authorization or referral and 2 percent to questions of medical necessity. A whopping 77 percent were classified as "all other reasons." 

Adding to the inconsistency is the fact that health plan denial rates fluctuate year over year. In 2020, a gold-level health plan offered by Oscar Insurance in Florida denied 66 percent of payment requests; in 2021 it denied 7 percent.

And here's a refrain I hear from physician friends from all over:

"Nobody becomes a physician because they hope to feel like a cog in a factory," Michael Ivy, MD, deputy chief medical officer of Yale New Haven (Conn.) Health, told Becker's. "However, between meeting the demands of payers for referrals, denials of payment and increased documentation requirements in order to assure proper reimbursement and risk adjustment, as well as an increasing number of production metrics, it can be difficult not to feel like a cog." 

As for the government's role in policing the conduct of these insurers:

Authors of the 2010 Affordable Care Act worried that provisions to expand health insurance access — such as barring health insurers' refusal to cover patients with preexisting conditions — could cause them to ratchet up other tactics to make up for the change. With this in mind, the law charged HHS with monitoring health plan denial rates, but oversight has been unfulfilled, leaving denials widespread.  

When you consider insurance company profits and their executive salaries, it's apparent that the "middle men" in these transactions are getting rich at the expense of providers and patients alike. Where's a good, old-fashioned congressional or FTC hearing when you need one? 


Sunday, July 09, 2023

Surprise medical bills, 'junk' insurance - new proposals from Biden administration

We've been hearing about "surprise medical bills" for years. A colleague of mine had surgery over a decade ago and did everything humanly possible to avoid an unpleasant surprise, including checking with the anesthesiology group to make sure the assigned anesthesiologist would be an "in network" physician -- that is, would be covered by our insurance plan. "No problem," said the group's manager. Come the day of the surgery and a last-minute schedule change for the assigned anesthesiologist led to a substitution in the OR and guess what? The substitute anesthesiologist, despite being under contract with the group, was "out of network." As a result, instead of a bill for anesthesia services in the hundreds of dollars, the actual charge -- 100% of which was my colleague's responsibility -- was in the thousands. Surprise!

NPR and Kaiser Health News produce a monthly feature entitled "Bill of the Month." The stories would be comical if they weren't soul-crushing. 

The stories persist, though, even after January 1, 2022, the effective date of the federal No Surprises Act (part of the previous year's omnibus appropriations bill). And even after reams of analysis and guidance from HHS/CMS, Brookings, the Commonwealth Fund, the Consumer Financial Protection Board, the Department of Labor, the Federal Trade Commission, and of course Kaiser Health News.

So, as reported by Becker's Payer Issues, "the Biden administration is issuing guidance to end the abuse of 'in-network' designation, according to a July 7 White House news release." [President's remarks; fact sheet

The White House fact sheet provides impressive detail that describes steps to address the following problem areas:
  • "New proposed rules would close loopholes that the previous administration took advantage of that allow companies to offer misleading insurance products that can discriminate based on pre-existing conditions and trick consumers into buying products that provide little or no coverage when they need it most."
  • "New guidance will help stop providers from gaming the system by evading the surprise billing rules with creative contractual loopholes that still leave consumers with unexpected costs."
  • "For the first time in history, the Consumer Financial Protection Bureau, HHS, and Treasury are collaborating to explore whether health care provider and third-party efforts to encourage consumers to sign up for medical credit cards and loans are operating outside of existing consumer protections and breaking the law."

Friday, June 09, 2023

Allina Health Suspends Policy to Deny Care to Patients with Unpaid Bills

One week ago (see Becker Health (no paywall), June 1), the N.Y. Times reported that Allina Health's policy was to deny clinic care to patients with unpaid bills. Emergency room visits were not part of the policy, and the unpaid balance had to exceed $4,500. This may be a smart business decision, but -- as the refrain goes throughout the semester in my health law class -- health care is different, and it's not a good look for a major nonprofit health care provider. The policy is apparently quite widespread. A 2022 study found that about 20% of hospitals deny nonemergency care for the same reason (Kaiser Health, Dec. 2022).

Today, the Star Tribune reported that Allina has suspended its policy, presumably in no small part because the Minnesota AG was inviting patients to submit reports of denials to his office as he considers launching an investigation into the policy.

Saturday, May 27, 2023

More on Consolidation within the Health Care Industry

Fortune's team of Maria Aspan and Erika Fry have focused their analytical lens on the growth of health care firms in their recent article, "Companies like CVS and UnitedHealth are now some of the world’s biggest businesses. Is that healthy for the rest of us?" (May 24, 2023). It's a good read.

Let's start some context. Despite a recent minor dip, health care is the largest single sector that contributes to our Gross Domestic Product, the equal of defense and education (at all levels) combined. 

Although this number -- whether expressed in absolute dollars, as a percentage of GDP, or as expenditures per capita -- is vastly larger than the expenditures of every other developed country in the world. And by almost any measure, the results -- in terms of life span, infant and maternal mortality, etc. --  pale in comparison to the same countries and many developing countries, as well. Much has been written about this conundrum. After all, we are a rich country and if we want to spend a lot of our wealth on health care, well, why not? The counter-argument is multifaceted. Are we as a society making smart decisions about those health care expenditures? Are there better strategies than "throw a ton of money at what ails you and hope that something works"? Are we doing all we reasonably can to root out waste and fraud? As COVID vividly and catastrophically demonstrated, expenditures for health care goods and services are not equitably distributed to racial and ethnic minorities, economically disadvantaged individuals and households, or the under- and uninsured, a group that persists despites the reforms of Obamacare.

This is Aspan and Fry's concern, too. They are looking at the rapid and extensive increase in firm size and the consolidation of disparate providers (hospitals, pharmacies, clinics, physician practices) into behemoths of unimaginable market power see at least a correlative relationship with GDP. Much of the merger activity in the health care sector is fueled by debt and venture capital, all of which demands cash flow to service. In other words, relentless growth in net revenues, year over year and quarter over quarter. Where's the incentive to keep patients healthy and out of hospital beds or to provide the most cost-effective care?

Granted, providers prosper by delivering more goods and services. And insurers prosper by paying for less care. As the authors point out, there is a conflict of interest at a fundamental level of this business model. Meanwhile, it's the wild, west out there, and the big firms seem to be doing just fine, at least for now. Whether that translates into better health outcomes for the rest of us is still very much in doubt.


Friday, May 19, 2023

"Preauthorization" and why your insurer is out to get you

I am not saying health insurers are evil. Or that their policies are evil. But their claims-handling practices are very often ill-advised, are calculated to maximize corporate revenues at the expense of the health of their insureds, and too often produce results that are, well, evil.

One of the defining characteristics of "managed care" -- which used to be this funky little thing over in the corner of our system of healthcare finance and delivery and now is everywhere -- is the notion of preauthorization by your insurance company before you can get almost anything: a visit to a specialist, hospitalization, a prescription drug, etc. The craziness that sometimes marks this process is hard to fathom (other than the aforementioned profit motive). Dr. Amy Faith Ho has taken this on over on Twitter and her posts are well worth following.

Tuesday, July 13, 2021

The High Costs of Non-Beneficial Treatments in the ICU

Thad Pope has a useful post on this subject. There are direct medical costs (estimated at $2,700/day (Ottawa study) to $4,000/day (UCLA study)), but equally if not more concerning "may be (a) the opportunity cost when other patients are denied ICU care, (b) moral distress of the nursing staff, and (c) suffering inflicted on the patient." 

None of this seems to matter to the legislators in Texas who try, every legislative session, to gut the provisions of the Texas Advance Directives Act that were added in 1999 to deal with disputes over medically inappropriate treatment. The provisions are at Tex. Health & Safety Code § 166.046. The purpose of the law was to provide a nonjudicial mechanism for resolving these disputes. The key provision is in subsection (d), which -- after reasonable efforts over a 10-day period to find a provider willing to provide the treatment requested by the surrogate decision-maker fail to identify a provider willing to accept transfer of the patient -- permits the disputed treatment to be withheld or withdrawn.

The objectors in the legislature want to replace that 10-day process with a provision that requires the health care providers to "treat until transfer." This benign-sounding idea would mean that, in the vast majority of cases in which no transferee provider can be found, medically inappropriate treatment must be provided until death occurs, which may be months or even years later. A current example is the Tinslee Lewis case in Fort Worth, which has been in litigation for over two years. According to a motion filed by defendant Cook Children's Hospital

a review of Tinslee’s case was initiated by third-party administrator Aetna’s Special Investigative Unit, which has requested all of Tinslee’s records. The Special Investigative Unit’s mandate under Medicaid regulations is to investigate “waste, abuse, and fraud,” the motion says.

“In Cook Children’s experience, such reviews are often precursors to efforts to deny payment or even claw back funds previously paid,” the motion said.

Friday, July 02, 2021

SCOTUS grants review in 4 health law cases

The 2021 Term will be a lively one for health lawyers in light of yesterday's grant of four petitions for review (two Medicare cases, one Medicaid case, and a PPACA case that doesn't involve a challenge to the constitutionality of the law):

  • American Hospital Association v. Becerra, No. 20-1114, a challenge to a Department of Health and Human Services rule that cut Medicare reimbursement rates for prescription drugs for hospitals that participate in a program for underserved communities. The U.S. Court of Appeals for the District of Columbia Circuit ruled that the reimbursement cut was a reasonable interpretation of the Medicare statute; the justices on Friday agreed to weigh in on whether that deference is appropriate in this case. The court also asked both sides to discuss whether the challenge is barred by a provision of federal law that limits judicial review of certain Medicare-related calculations.
  • Gallardo v. Marstiller, No. 20-1263, in which the court will decide whether a state Medicaid program can get reimbursed for past medical expenses that it has paid by taking money from a settlement or jury award that is intended to compensate for future expenses.
  • Becerra v. Empire Health Foundation, No. 20-1312, a dispute over how to calculate additional payments under the federal Medicare program for hospitals with a large number of low-income patients.
  • CVS Pharmacy v. Doe, No. 20-1374, in which the court will consider whether the Rehabilitation Act, which bars discrimination on the basis of disability by any program or activity receiving federal funding, and the Affordable Care Act allow plaintiffs to bring claims alleging that a policy or practice disproportionately affects people with disabilities.

Thursday, July 01, 2021

CMS Proposes Final Interim Rule to Implement the No Surprises Act

Surprise medical bills are horrific events for patients and their families, throw insurance underwriting into disarray, and create or reinforce barriers to entry into the medical-industrial complex. The federal No Surprises Act (a relatively small part (32 pages) of H.R. 133, the 2,124-page Omnibus Reconciliation Act of 2021) was supposed to address the problem, but the new law needed a regulation to implement it. That rule -- in the form of a 411-page "interim final rule" with a request for comments -- dropped today.  CMS has provided a reasonably helpful fact sheet if you don't have time to wade through the rule's preamble. The rule is supposed to have an effective date of January 1, 2022, but don't be surprised if that date gets bumped. This rule will undoubtedly attract a ton of comments. The comment period closes 60 days after publication of the interim final rule in the Federal Register.

Tuesday, September 08, 2020

$10,984 for a COVID-19 Antibody Test? Yes.

This is like one of those kid's puzzles -- Can You Spot the Errors in This Picture? -- with upside-down swings hanging up from tree branches and a man wearing unmatched socks. As reported by ProPublica, a part-time ER medical director walks into his employer's stand-along emergicare center to get a COVID-19 antibody test. There's no serious attempt to take a history and no physical exam, just a blood draw and results 30 minutes later.

The charge (100% of which was paid by the doctor's insurance company, a subsidiary of health insurance behemoth UnitedHealthcare): $10,984: $2,100 for the physician portion and $8,884 for the facility fee.

1. The facility advertises the price of an antibody test on its website: $75.

2. The insurer never blinked before paying the charges in full. 

3. The parent company of the insurer cleared $6.6 billion in net earnings in the second quarter of 2020. An $11,000 bill -- whether sent in error or because of a policy of price gouging -- may amount to a rounding error for the insurer's first hour of operations at the beginning of each quarter and just not worth the hassle to question the provider.

4. It's not as if UnitedHealthcare or its sub ends up footing the bill for these charges. They are paid by all of UHC's policyholders.

I am partial to Medicare opt-in for all in the hope that it will provide a reality check for providers and private insurers, whose business model is making lots of people rich off the most expensive system of health care in the world. According to the ProPublica article: "Medicare lists its payment at $42.13 for COVID-19 antibody tests." That's a reality check!

The ER doctor/patient responded to this episode with a letter of resignation: "I have decided I can no longer ethically provide Medical directorship services to the company . . . . If not outright fraudulent, these charges are at least exorbitant and seek to take advantage of payers in the midst of the COVID19 pandemic."

Friday, July 31, 2020

In Texas, More People Are Losing Their Health Insurance as COVID Cases Climb

From a story by Ashley Lopez of Public Radio station KUT in Austin (and picked up by Kaiser Health Network):
Texas’ uninsured rate has been climbing along with its unemployment rate as COVID cases also surge in the state. Before the pandemic, Texas already had the highest rate and largest number of people without insurance among all states. And 20% of all uninsured children in the U.S. live in Texas.

The uninsurance problem has only gotten worse in Texas in 2020. According to recent data from Families USA, a consumer health advocacy group that supported the Affordable Care Act, 29% of Texas adults under 65 don’t have health insurance so far this year.

The group found that about 659,000 people in the state became uninsured between February and May as job losses soared. Texas is one of 13 states that has not expanded Medicaid under the ACA.
Thirty-seven states and D.C. have expanded Medicaid eligibility in response to a generous federal match under the ACA -- and that doesn't include Missouri, where voters are voting on Tuesday on Medicaid expansion. Texas is one of the holdouts, for reason that defy logic. We'll see if it continues to defy politics in November. In recent decades we've been a resolutely red state in statewide and presidential elections. Is this the year the politicians who have turned their backs on the poor and disabled individuals in this state are held to account for their heedless, heartless actions?