High Risk Insurance Pools

Did you know that about 30 states already had high risk insurance pools? Some of these policies were well developled, others were not. What does this tell you about the current debate about healthcare..... the Federal government tends to do tasks that others are already doing. Yet, when the Federal government passes a massive legislation that is already be done at the state level, it is seen as a massive accomplishment. Doing something is seen as more useful that not doing something at all in Washington. Here were states that had high risk insurance pools already because PPACA.

http://www.npaf.org/images/pdf/hipai/High-RiskTable.pdf

More Time for the Regulator to Find overpayments

In case you missed it....

PPACA allows States a year to recover over-payments that are not related to fraud or abuse cases. Before, States had 60 days to find the refund from the healthcare provider before it billed the Federal share of the bill. With a longer time of recovery, States will probably increasingly thorough and detailed in any Medicare/Medicaid submission.

Here is the CMS Release.

What did we just pass?

There was a recent blog post on thehealthcareblog.com about a rebuttal that Obamacare has become increasingly unpopular as people know about it. The writer suggests that as people become more aware of PPACA that people have grown to like it.

There are two problems with her argument.

The first is that it is not true. If you look at the Realclear polling website. The support for the bill has gradually decreased. It is not significant but it is lower. I do not think it is a strong argument to say that the polling has leaned in any direction, expect to say that the polling has always shown that people are against Obamacare. There is clear disparity of individuals not liking Obamacare. The trend has always been, "opposition to Obamacare".

The second is that NO ONE knows what they passed a few months ago. Two shocking developments have come forward. One is that deep within the legislation that now gold coins are now being taxed. The other is that now you need a prescription to withdraw money from your health savings accounts. What else will come forward over the coming months? I am not sure people are growing in liking to the Bill because I am not sure anyone really knows what they passed.

Update to the HHS auditing

"That’s why in addition to law enforcement actions like the ones we’ve taken today, we’ve also launched an ambitious national effort to block criminals at every step of the fraud process – from making it harder for corrupt providers to participate in Medicare or Medicaid to helping law enforcement agents analyze claims data to find suspicious patterns that could indicate fraud."

From the HHS Secretary speech. The government is planning on increasing auditing Medicare payments. Healthcare providers should expect some sort of auditing bill to be on the Hill soon.

No more Health Insurance?

I was talking with my insurance professor a few months ago. We were chatting about PPACA. He mad a very interesting point. Since he is a insurance broker, his job is to find the best deal for his clients. He has been telling his clients that since the government prevents insurance companies from denying people because of prexisiting conditions, individuals can get sick and then go buy coverage. While this may be expensive, if you get very sick and have 500k in bills, the insurance companies must cover you in the high risk pools. Your deductible will be huge but the punishment for not having insurance is still a measly 600 dollars a year for a individual. This slight of hand some people will use just causes more headaches for insurance companies. Then again, they supported Obamacare; maybe they deserve it!

More Payment Cuts coming soon

This time, the cut are not official but through the auditor saying you don't need to charge this or that. Expect longer turn around in payments and more payment cuts. The 60 billion is going to some hospital or practice. It is not coming out of thin air!

CQ Healthbeat: Senators Thursday also urged Medicare officials to do more to stop the up to $60 billion a year that goes out the door in improper payments in the program. "CMS officials are in the process of implementing provisions in the health care overhaul that will broaden auditing efforts aimed at reducing fraud. Congress also sent President Obama additional legislation Wednesday aimed at reducing improper payments in federal agencies. But CMS also needs to finish fixing vulnerabilities found by the Government Accountability Office (GAO) in its system, senators and experts said" (Adams, 7/15).

Can Healthcare ever adapt to new social media?

There have been several interesting articles about the role social media has on healthcare. Most of the time the analysis focuses on the lack of penetration. I think social media is encountering a blockade within healthcare.

Medic 999, a popular doctor's blog in Britian, is closing shop. He writes,

"Some of the bloggers out here may want to continue the fight, and maybe I am being a coward, but I dont want to risk getting into a position where I cannot provide for my family and can no longer do the job that I love so much."

The issue of privacy for doctors is always been a complex subject. How much information can doctors share with the world about their patients or their practice?

I know that many individuals have faith in EHR and EMR to transform the healthcare industry. I am one of those people, but the battle will be over privacy. Just like the backlash from Facebook, healthcare will continue to face the issue of how to share information.

I am of the persuasion that individuals need to control their information better. The back lash against Facebook style exposure has been around the idea of "creeping", where people follow your every footsteps, and potential harm to your professional image by overexposure. The fact of the matter is that people who are Facebook addicts share way to much information and the risk is that you will loose control of your identity by being associated with Facebook addicts. Social media addicts are people who have no filter and no reconciliation of the consequences of over-sharing.

This relates to healthcare because the "Facebook effect" of oversharing might make inroads into healthcare. It is possible that individuals become looser with their information. The place to start is not social media but with EHR. Some libertarian minded individuals might be up in arms about this gradual slide, but the slippery slope argument is often considered a informal fallacy. The main problem with healthcare is the lack of information and complexity. EHR does have the potential to make care for efficient and effective, but it will rub against people's libertarian sensibilities about their health.

Social media can provide a way to education the general populus but is really not a way to revolutionize healthcare. The only reason I write is to share with everyone my experiences within the healthcare industry. I think social media provides a avenue to share information but is a huge liability for doctors. In the era of litigation, a new action is out lawed every week in the US, doctors need to be careful about social media and the "Facebook effect". Unless patients become more free with their information, social media is a lawsuit waiting to happen.

CBO Quotes to Remember

Democrats liked to quote the CBO about PPACA. CBO did issue a judgement about PPACA saying it could save a 100 billion over ten years; however, these supposed savings keep getting chipped away. No one is really paying attention. Nor did the Democrats fully read the CBO opinion. They clarified saying that there was not enough good information and these are not full judgments because of the lack of information.

Here are some good recent writings from the CBO.

On budget predictions from 2010-2019-

A detailed year-by-year projection, like those that CBO prepares for the 10-year
budget window, would not be meaningful over a longer horizon because the
uncertainties involved are simply too great. Among other factors, a wide range of
changes could occur—in people’s health, in the sources and extent of their
insurance coverage, and in the delivery of medical care (such as advances in
medical research, technological developments, and changes in physicians’
practice patterns) —that are likely to be significant but are very difficult to
predict, both under current law and under any proposal.

Doc Fix-

CBO expects that the reconciliation proposal and the Senate-passed health bill would yield a net increase in $260 billion in budget deficits during the decade beyond 2019.

In effect, the majority of the HI trust fund savings under
H.R. 3590 and the reconciliation proposal would be used to pay for other
spending and therefore would not enhance the ability of the government to pay for
future Medicare benefits.

So Where is the best place to die?

From the Economist:

Quality of death
A ranking of care for the dying by country
Jul 14th 2010

CUSTOMER-satisfaction surveys are, alas, unsuitable for rating the quality of death. So the Economist Intelligence Unit, a sister group to The Economist, has devised a ranking of end-of-life care, published on Wednesday July 14th. It rates 40 mostly rich countries by how well they care for the dying. Britain tops the table. For all the health care system's faults, British doctors tend to be honest about prognoses, the mortally ill get plentiful pain killers and a well-established hospice movement cares for people near death. Countries such as Denmark and Finland rank lower because they concentrate more on preventing death than on helping people die without suffering pain, discomfort and distress.

Are Doctors over-payed?

Here is some recent data I found on physician pay....

Merritt Hawkins’ 2010 Inpatient-Outpatient Survey revealed the following
statistics on the average yearly revenue by specialty and
the average salary for employed specialists.

Neurosurgery: $2,815,650 revenue; $571,000 salary
Cardiology (invasive): $2,240,366 revenue; $475,000 salary
Orthopedic surgery: $2,117,764 revenue; $481,000 salary
General surgery: $2,112,492 revenue; $321,000 salary
Internal medicine: $1,678,341 revenue; $186,000 salary
Family practice: $1,622,832 revenue; $173,000 salary
Hematology/Oncology: $1,485,627 revenue; $335,000 salary
Gastroenterology: $1,450,540 revenue; $393,000 salary
Urology: $1,382,704 revenue; $401,000 salary
OB/GYN: $1,364,131 revenue; $266,000 salary
Cardiology (non-invasive): $1,319,658 revenue; $419,000 salary
Psychiatry: $1,290,104 revenue; $200,000 salary
Pulmonology: $1,204,919 revenue; $293,000 salary
Neurology: $907,317 revenue; $258,000 salary
Pediatrics: $856,154 revenue; $171,000 salary
Ophthalmology: $842,711 revenue; $282,000 salary
Nephrology: $696,888 revenue; $240,000 salary

Next Payment Cut Looms!

Another cut is coming down the pipe. Will this one stick? I am not sure how willing the Federal Government, less CMS and MedPac, are willing to do what they set out to do. I think any frank understanding of the healthcare industry will show that payments are falling in order to prevent a spiraling increase in costs.
The plan cut is 6.1% overall Medicare cuts starting Jan. 1 2011. This cut will be on top of a planned cut in December, which will be a huge 23.5% cut. This is the dreaded Doc Fix, that the Democratic Congress politically put off so they could pass healthcare reform; however political wise a move, this continual impendence of making the tough decision makes individuals lose faith in the government’s ability to do solve problems. I do not think cutting payments is the right way to fix healthcare, but the Democratic leaders explicitly made plans to cut reimbursements so as to stay on track for healthcare reform (attempt to be on budget).
The overall problem needs to be a perspective change. Right now, government is attempting to attack more of the demand side, rather than the supply side. Information and understanding basic cost drivers are the essential fix to healthcare. Reducing payments only squeezes doctors and makes their life harder. If anything hurts doctors, it will probably hurt patients. What needs to be done is understand the basic inflation of costs associated with practicing medicine. Then translate that into margins and profitability. I am not calling for a new government regulation but more information needs to be provided so as doctors to patients make wise choices. A wise consumer always brings down costs and makes competition increase.
I think the healthcare system is so convoluted and lost that no one really has the time or capability to understand it. If something is complex and no one really understands the grand picture, then it will be expensive and continue to perpetuity until the information is there to increase buying power. It is simple economics.

http://www.modernhealthcare.com/article/20100712/MODERNPHYSICIAN/307129981/-1

Berwick's Craigslist Employment

People in the industry and within the Republican party are up in arms about the off appointment of Berwick to the head of CMS without any sort of Senate confirmation hearing.

The most obvious reason was that Max Baucus (D) did not put it on the agenda. Most quip oberservers may say this was a consirpacy to do a short-term appointment to start the work on Obama-care. I am not sure about this assertion but it is obvious that Mr. Berwick is not your average joe. He is actually rather left and some consider him a socialist when it comes to healthcare.

Here are a list of his comments from the WSJ:

Rationing care. "The decision is not whether or not we will ration care — the decision is whether we will ration with our eyes open."

The British healthcare system. "I am romantic about the National Health Service. … I love it." This government-run system — known for waiting lines, rationing and staid bureaucracy — is "such a seductress" and "a global treasure."

Healthcare regulation. "The primary functions" of health regulation are "to constrain decentralized, individual decision making" and "to weigh public welfare against the choices of private consumers."

Clinical protocols. Clinical protocols for care are based on the "common underlying notion that someone knows or can discover the 'best way' to carry out a task to reach a decision, and that improvement can come from standardizing processes and behaviors to conform to this ideal model."

David E. Williams, from Healthcare Business Blog, called this recess appointment savvy. His reasoning is that this healthcare reform needs to start being implemented now. The reform has been sitting around being held up by politics (maybe because no one really understands what was passed?). He also uses the proverbial, "Bush did it, why can't Obama?" Citing the appointment of Bolton as Ambassador to the UN.

Let's do some fact checking first. Bolton was appointed after some confirmation process. The Democrats were holding up his appointment after Bolton had gone through hearings with the Senate Foreign Relations Committee. He sat through a few days of interviews and hard questioning. Bush only appointed him after the Democrats filibustered for his vote in the Senate. The Republicans wanted to end the debate and go to a vote. The Democrats never allowed it. So after months, Bush appointed him when Congress went on Recess. Bush's intention was always to make him permanent and was going too, and did, put him up again for the confirmation process. While, this CMS appointment had no committee process and no open debate between members. It was all done before the process would of begun and Obama had plenty of time to put Berwick through the process before Recess. Also, Mr. Williams says these comments by Berwick above are sensationalist. I do not think so. They appear across several years at different localities.

I think it is obvious that Obama has overstepped his authority. He has a growing disapproval ratings. He is seen by many as a radical who does not care about the average american but more about ideology. He is a foreign policy wreck. Most of his moderate supporters are fleeing in droves. Obama used be so cool and, frankly, savvy. Now he looks like a bully who cant control himself. This appointment looks more like Sly Obama rather than the open and even-handed one we all saw in the campaign.

If Obamacare is so important to the country, by the admittance of Mr. Williams and President Obama, is not being open and clear about who will be running the show most important? Dont you think appointing someone the lead on spending 1 trillion dollars and cutting 500 billion requires a little more clarity than a news update from the WSJ? Savvy move.... more like arrogant and self-defeating. This gives voters even more reason to expect the Great Reversal on November 2.


http://www.medscape.com/viewarticle/724710
http://www.healthbusinessblog.com/?p=3565&utm_source=feedburner&utm_medium=feed&utm_campaign=Feed:+HealthBusinessBlog+(Health+business+blog)
http://www.beckersasc.com/healthcare-reform/senate-hearings-on-new-cms-chief-would-have-exposed-restrictive-nature-of-obamacare.html

Update on Reform Costs

"An updated actuarial analysis on the Patient Protection and Affordable Care Act (PPACA) estimates that the law would reduce the number of uninsured from 57 million to an estimated 23 million by 2019 and would increase health expenditures by almost 1 percent, or $311 billion from 2010 to 2019. The report also warns that reductions in payments to hospitals and other providers are unlikely to be sustainable on a permanent annual basis. "

The costs of healthcare reform just got bumped up and the CMS has admitted a reluctant fact. Hospitals will close because of the reduction in payments. Any acute analysis of the hospital sector knows that consolidations are on the rise. Why are hospitals consolidating? They see that reimbursements are going down and they can potentiality make more money by a consolidation services model, as in make money by efficient management. This seems like a repeat of the 1990s managed care disaster.

The fact is that Obama-care is going to drive hospital closures. Whether this is a good thing or not is up to your perspective on economic theory and political persuasion.

http://www.premierinc.com/about/advocacy/publications/outlook/10/april30.jsp#article4

Give me a Doughnut

HHS released today its plan to close the doughnut hole left by the Accountable Care Act. They plan to send 250 bucks to those individuals who fall into the hole. Is this a fix? No. This is typical government fashion of trying to fix a obvious problem:

1. Ignore the obvious problems and create new ones by writing at 2500 page bill.

2. Attempt to the fix obvious problems by throwing short-term fixes.

3. We cannot fix a obvious problem by doing something simple.

I think it is kind of disgraceful to think that we have one obvious problem yet this massive bill does little to fix the problem. As well, short-term fixes like this that are not permanent tend to lead to a greater welfare government function down the road, think of alternative minimum tax.

http://www.hhs.gov/news/press/2010pres/07/20100708a.html

MedPac vs IPAB

Obama recently discussed the willingness to update MedPac into a super advisory committee. He says MedPac will be on “steroids” with this new Board, as in it will have much more power.

MedPac is an advisory group that was set up in 1997 from the Balanced Budget Act to monitor costs of Medicare payments. From this analysis, they would make recommendations. They are considered the "lobbyists" of the healthcare industry, from a payment perspective. While they main goal is to control costs, they have been supporters of better pay for doctors and hospitals (although incorrect on DSH payments).

Obama’s policy is to transform MedPac from a frankly powerless committee of smart people to a Board with the power to actually change things. Obama plans to create new independent panel called the Independent Payment Advisory Board. This 15 member board will have the power to act without the need of Congress. Congress can act against the IPAB but IPAB is allowed to do what it wishes unless Congress says no. This Board will have the power to cut payments where it deems necessary. Before MedPac issue advice about Medicare, but now MedPac will be partnered with IPAB, which will be a much more powerful body.

I think this is a little concerning. I am not really ever in favor for giving power to a Board without some sort of oversight. Having the ability to act and cut Medicare funding without the action of Congress seems like a heavy burden of responsibility. Not to mention, these individuals on IPAB will not be approved by Congress. The BBA does not set out that these individuals need to be approved by any congressional committee. The organizers within the government are saying that we do not “need” to have the IPAB members approved; I think shows some withheld intent.

This new 15 board panel will be made of full-time government employees. I am not sure why they need to be full-time because:

· They will only produce one report per year

· MedPac will produce a report 3 months after IPAB, what can happen in three months?

· Do we really need a full time 15 person board that just mulls over the same data CMH, HHS, MedPac, CHIP, etc. do already?

A more important question to ask is whether this panel replaces MedPac. I think people considered MedPac a good source of information and a good reference. The government usually never listed to their recommendations. I am not sure the IPAB will be any different. I think that most government officials have good intentions and believe it will help solve the problem. I just think that this IPAB is setting up to become the SEC of healthcare payments.

It does not surprise me that the government is transitioning power and information into the IPAB. It does what the US government likes to do all of the time: creates another regulatory power, creates another person someone needs to report too, costs money, prevents efficiency, and makes those in charge feel like they are doing something about the problem. It will indubitably be the day when the government thinks they are too big. When that happens, we will surely all be in trouble.