Category Archives: Health Insurance Industry

What health care is getting out of the stimulus package

Posted on by • Posted in COBRA Coverage, Coronavirus, Crisis, Crisis Management, Economic Stimulus, Health Insurance Coverage Adequacy, Health Insurance Industry, Health Policy, Health System, Hospital, Hospital Industry, Laboratory Industry, Medicare, Medicare Sequestration, Out of Pocket Expenses, Out-of-Network, Surprise Bills, Underinsured, Uninsured • Leave a comment

https://www.axios.com/health-care-hospitals-coronavirus-stimulus-package-c49bd0cc-05a0-479a-a83d-d4455bd0e7bd.html?utm_source=newsletter&utm_medium=email&utm_campaign=newsletter_axiosvitals&stream=top

Senate passes $2 Trillion coronavirus economic stimulus plan, it ...

Congress’ big stimulus package will provide more than $100 billion and several favorable payment policies to hospitals, doctors and others in the health care system as they grapple with the coronavirus outbreak.

The big picture: Hospitals, including those that treat a lot of rural and low-income patients, are getting the bailout they asked for — and then some.

The cornerstone provision is a no-strings-attached $100 billion fund for hospitals and other providers so they “continue to receive the support they need for COVID-19 related expenses and lost revenue,” according to a summary of the legislation.

  • It’s unclear how that money would be divvied up. One lobbyist speculated the funds would go to the “hardest-hit areas first and those areas that are next expected to get hit,” but that has not been clarified.

The bill provides many other incentives for the industry.

  • Hospitals that treat Medicare patients for COVID-19 will get a 20% payment increase for all services provided. That means Medicare’s payment for these types of hospital stays could go from $10,000 to $12,000, depending on the severity of the illness.
  • Employers and health insurers will be required to pay hospitals and labs whatever their charges are for COVID-19 tests if a contract is not in place. By comparison, Medicare pays $51.33 for a commercial coronavirus test.
  • Medicare’s “sequestration,” which cuts payments to providers by 2%, will be lifted until the end of this year.
  • Labs won’t face any scheduled Medicare cuts in 2021, and won delays in future payment cuts as well.

What’s missing: Patients who are hospitalized with COVID-19 could still be saddled with large, surprise bills for out-of-network care.

  • There also are no subsidies for COBRA coverage, which employers wanted for people who lost their jobs. However, people who are laid off are able to sign up for a health plan on the Affordable Care Act’s marketplaces or could qualify for Medicaid.

 

 

 

 

Justice Department sues Anthem, alleging Medicare fraud

Posted on by • Posted in Center for Medicare and Medicaid Services (CMS), Dept of Justice (DOJ), Fraud and Abuse, Health Insurance Industry, Lawsuit, Medicare Advantage, Rev Cycle Management • Leave a comment

https://www.axios.com/doj-anthem-lawsuit-medicare-advantage-fraud-11cdba13-eacd-4847-9bb0-20aa993235f9.html?utm_source=newsletter&utm_medium=email&utm_campaign=newsletter_axiosvitals&stream=top

Justice Department sues Anthem alleging Medicare Advantage fraud ...

The Department of Justice has sued Anthem, alleging that the health insurance company knowingly submitted inaccurate medical codes to the federal government from 2014 to 2018 as a way to get higher payments for its Medicare Advantage plans and turned “a blind eye” to coding problems.

Why it matters: This is one of the largest Medicare Advantage fraud lawsuits to date, and federal prosecutors believe they have more than enough to evidence to claim that Anthem bilked millions of dollars from taxpayers.

Background: DOJ has been probing the “risk adjustment” practices of all the major Medicare Advantage insurers for years, but hadn’t pulled the trigger on a lawsuit against a major player.

  • Risk adjustment is the process by which Medicare Advantage companies assign scores to their members based on the health conditions they have. Patients who have higher risk scores lead to higher payments from the federal government to the companies that insure them.
  • Insurers are required to review patients’ medical charts to verify the health conditions, and if insurers find any inaccurate diagnoses, they have to be deleted — which also would require the companies to pay back money to the federal government.

The Department of Justice is alleging that Anthem reviewed medical records, but only focused on finding “all possible new revenue-generating codes” while purposefully ignoring all erroneous diagnoses.

  • For example, according to the DOJ’s lawsuit, Anthem coded one member in 2015 as having active lung cancer.
  • “Anthem’s chart review program did not substantiate the active lung cancer diagnosis,” the DOJ alleges. Instead of deleting that diagnosis, Anthem allegedly added another three codes — leading to a $7,000 overpayment just for that member that year.

The other side: Anthem said in a statement that it intends “to vigorously defend our Medicare risk adjustment practices” and that “the government is trying to hold Anthem and other Medicare Advantage plans to payment standards that CMS does not apply to original Medicare.”

The big picture: Medicare Advantage continues to enroll seniors and people with disabilities at high rates, even as more allegations of fraud come out against the insurers that run the program.

Read the lawsuit.

 

 

 

 

KHN’s ‘What The Health?’: The Affordable Care Act Turns 10

Posted on by • Posted in 2020 Election Issues, ACA, Essential Health Benefits, Health Insurance Coverage Adequacy, Health Insurance Industry, Health Policy, Medicaid, Medicaid Expansion, Preexisting Conditions, Underinsured, Uninsured • Leave a comment

https://khn.org/news/khn-podcast-what-the-health-the-affordable-care-act-turns-10/

Image result for KHN’s ‘What The Health?’: The Affordable Care Act Turns 10

Can’t see the audio player? Click here to listen on SoundCloud.

The past decade for the health law has been filled with controversy and several near-death experiences. But the law also brought health coverage to millions of Americans and laid the groundwork for a shift to a health system that pays for quality rather than quantity.

Yet the future of the law remains in doubt. Many progressive Democrats would like to scrap it in favor of a “Medicare for All” system that would be fully financed by the federal government. Republicans would still like to repeal or substantially alter it. And the Supreme Court recently accepted another case that could invalidate the law in its entirety.

In this special episode of KHN’s “What the Health?” host Julie Rovner interviews Kathleen Sebelius, who was secretary of Health and Human Services during the development, passage and implementation of the health law.

Then Rovner, Joanne Kenen of Politico and Mary Agnes Carey of Kaiser Health News, who have all covered the law from the start, discuss the ACA’s past, present and future.

Among the takeaways from this week’s podcast:

  • Although the creation of the ACA is often attributed to the Obama administration and the Democratic Congress at the time, work on a health care plan actually began well before then with small-group meetings among stakeholders, congressional hearings across the country and efforts by Sen. Ted Kennedy to galvanize interest. Much of those interactions were bipartisan and included industry leaders too.
  • Despite the vehement Republican opposition to the ACA and its many critical junctures (the death of Kennedy and his replacement by Republican Scott Brown; two tight Supreme Court decisions; and the calamitous debut of the marketplace website, among other issues), the law has proved popular. When Republicans gained control of the White House and Congress, their efforts to repeal the law helped focus consumers’ interest on the law and safeguard it.
  • How will the November election affect the law? If President Donald Trump is reelected, he is unlikely to renew the effort to repeal the law, but that doesn’t mean the assault on the law is over. Efforts to change the ACA could continue through the courts and through administrative rulemaking.
  • If a Democrat is elected, modifications to the law are generally expected to be incremental and perhaps deal with changes such as expanding the number of people getting subsidies and fix some glitches in the law.

 

 

 

This Is One Anxiety We Should Eliminate for the Coronavirus Outbreak

Posted on by • Posted in 2020 Election Issues, Coronavirus, Health Insurance Coverage Adequacy, Health Insurance Industry, Health Policy, High Deductible Health Plans, High Drug Prices, High Premiums, High Prices, Out of Network, Out of Pocket Expenses, Out-of-Network, Pandemic, Surprise Bills, Underinsured, Uninsured • Leave a comment

Image result for This Is One Anxiety We Should Eliminate for the Coronavirus Outbreak

A patient can do everything right and still face substantial surprise medical bills.

In his recent Oval Office speech, President Trump pledged that Americans won’t receive surprise bills for their coronavirus testing.

The goal is good; we need people who are lightly symptomatic to be tested without fear of high personal costs. But it was an empty promise. Unless swift action is taken, surprise bills are coming. And they could exacerbate a public health crisis that is already threatening to spiral out of control.

As demand for coronavirus testing surges and beds start to fill with the sick, hospitals and clinics will roll out contingency plans that call on any available resources in their communities. Test samples will be sent to whichever private laboratories have capacity, patients will be transferred from overloaded hospitals to less-crowded locations and physicians and nurses will make greater use of telemedicine.

Emergency rooms will be slammed with visits from the worried well and the dangerously sick alike. College students are already being sent home and will seek treatment far from the universities that offer them health insurance.

All of this will be chaotic.

To their credit, health insurers recognize the need to eliminate out-of-pocket spending that might discourage people from seeking care. At a meeting earlier this week with Vice President Mike Pence, they publicly committed to eliminating deductibles and co-pays for coronavirus testing. The federal government is also taking some needed steps to eliminate or ease cost-sharing.

But insurance companies aren’t the ones sending surprise bills. They’re coming from private labs and emergency-room doctors and other providers of health care services — and they weren’t at Vice President Pence’s meeting.

A patient with insurance through work or the health-insurance exchanges can be surprise-billed when she seeks medical care at a hospital or clinic that’s in her insurance “network” — but then receives medical care from a person or an institution that’s outside the network.

That out-of-network provider will first send a bill to the patient’s insurer. But if the insurer doesn’t pay the full amount, the provider may bill the patient directly for the remaining balance. Because the provider is basically free to name its own price, these surprise bills can be wildly inflated.

In a coronavirus pandemic, a patient can do everything right and still face substantial surprise bills. Take someone who fears that she may have contracted Covid-19. After self-quarantining for a week, she develops severe shortness of breath. Her partner rushes her to the nearest in-network emergency room. But she’s actually seen by an out-of-network doctor — who may soon send her a hefty bill for the visit.

Matters get worse if the in-network hospital is approaching capacity and the patient is healthy enough to be sent to a hospital across town with spare beds. If the second hospital is outside her insurance network, she could potentially receive a second surprise bill. A third could come from the ambulance that transfers her — it too might not be in-network, and no one will think to check during a crisis. She could get a fourth surprise bill if her coronavirus tests are sent to an out-of-network lab. And so on.

Even in normal times, patients with private insurance receive roughly one surprise bill for every 10 inpatient hospital admissions.

These are not normal times.

Federal law currently provides little protection. The Affordable Care Act does cap an individual’s out-of-pocket spending — but the cap only applies to in-network care. For surprise bills, the sky is the limit.

Reputable providers will appreciate that now is not the time for price gouging. But many won’t and will seek to exploit people’s medical needs for financial gain, much as they did before the coronavirus began to spread. They may calculate that can collect enough money charging exorbitant fees for out-of-network services — and still make it to an airport ahead of a mob carrying pitchforks and torches.

We need more than gauzy commitments from the president. We need a law to ban bills incurred from out-of-network providers for medical care associated with the coronavirus outbreak. Unless that commitment is ironclad, people may not believe it. And if they don’t believe it, they won’t get tested.

To date, Congress — cowed by a furious public relations campaign led by private equity and specialty physicians — has been unable to pass a law banning routine surprise billing. Though Congress has moved closer to a watered-down deal in recent months, neither the House nor the Senate has actually passed a bill.

The coronavirus should refocus Congress’s attention. At a minimum, the legislature should quickly pass a temporary measure to limit out-of-network charges for coronavirus testing and treatment.

In the meantime, states can take action. About half have already passed surprise-billing laws, including California and New York, two of the hardest-hit states. But the laws in many states are patchy: Some cover only emergency room care, others don’t contain a legal mechanism for cutting back on excessive bills, and none are tailored for the current outbreak.

Already, reports of people who have received eye-popping bills for coronavirus testing or emergency room visits are circulating. As these stories proliferate, people will become even more reluctant to get tested or treated when they should. That will obscure the spread of the virus, complicate efforts to adopt measures for social distancing, and lead to unnecessary deaths.

It’s a national disgrace that the United States didn’t ban surprise bills in a time of relative prosperity and security. It could become a public health calamity if we do not end them in a world with coronavirus.

 

 

 

Health Insurers aren’t that worried about coronavirus

Posted on by • Posted in 2020 Election Issues, Coronavirus, Health Insurance Benefit Design, Health Insurance Coverage Adequacy, Health Insurance Industry, Health Policy, Pandemic • Leave a comment

https://mail.yahoo.com/d/folders/1/messages/181951?.src=fp

Image result for Health Insurance profits

Health insurance companies are not concerned yet that the new coronavirus is going to drive up their medical claims and spending, Axios’ Bob Herman reports.

The big picture: More people will need expensive hospitalizations to treat COVID-19, which has turned into a full-blown public health emergency.

  • But insurers view the outbreak as an “extension of the flu season,” according to a Wall Street bank that spoke with insurance executives last week.

What they’re saying: Barclays held its health care conference digitally last week, and several insurance executives reiterated their companies’ profit projections for this year — relatively remarkable statements considering economists believe a recession is imminent.

  • “We’re not expecting a material financial impact,” said Matt Manders, a top Cigna executive.

Between the lines: A lot more cases and hospitalizations are coming. But those will be partially offset, from an actuarial perspective, by delays or cancellations of costly elective procedures like joint replacements — something that hospitals are starting to do.

  • “There is a net saving” when non-emergency procedures are eliminated, Anthem CFO John Gallina told Barclays analysts.

The bottom line: The coronavirus is throttling almost every business in America. Large insurers think they’re mostly immune, and if medical claims start to rise uncontrollably, they will increase everyone’s premiums next year.

  • “We would price for this for 2021 to the extent there’s any meaningful impact,” Humana CFO Brian Kane said. “I would imagine the industry will as well.”

 

 

 

Taking a look at the Biden healthcare plan

Posted on by • Posted in 2020 Election Issues, ACA, Competition, Health Insurance Benefit Design, Health Insurance Coverage Adequacy, Health Insurance Industry, Health Policy, High Deductible Health Plans, High Drug Prices, Medicaid, Medicaid Expansion, Medicare, Public Option, Surprise Bills, Underinsured, Uninsured • Leave a comment

https://mailchi.mp/325cd862d7a7/the-weekly-gist-march-13-2020?e=d1e747d2d8

 

Now that the Democratic primary campaign has produced a clear front runner, it’s worth examining Joe Biden’s healthcare plan, which aims to expand the Affordable Care Act (ACA) by increasing access and affordability. As the graphic above highlights, former Vice President Biden has a broad—if at this point, still fairly high-level—proposal that includes a Medicare-like public option along with a variety of other ACA tweaks that aim to offer consumers more options and lower their healthcare costs.

These include allowing individuals in states without Medicaid expansion to join the pubic option premium-free, providing unlimited subsidy eligibility, and limiting drug price increases to the level of consumer inflation.

An independent analysis projects Biden’s plan would cost $2.25T and add an additional $800B to the deficit over 10 years. While large at first blush, these costs pale in comparison to Sen. Bernie Sanders’ Medicare for All plan, which would add a projected $12.95T to the deficit over the same period.

Of course, there are still many unanswered questions in Biden’s proposal, including how much consumers would pay under the public option, how much the public option plan would reimburse providers as a percentage of Medicare, and how the public option would impact competition among private insurers.

A public option offered at a significant discount has the potential to drive private plans out of business, which some project could eventually result in Medicare for All as an ultimate consequence. The devil will, as always, be in the details.

 

UnitedHealth likely to keep squeezing physician staffing firms

Posted on by • Posted in Anesthesia, Balance Billing, Emergency Care, Emergency Room Staffing, Health Insurance Industry, Market Consolidation, Market Power, Market Share, Neonatology, Obstetrics, Out of Network, Out of Pocket Expenses, Out-of-Network, Private Equity, Surprise Bills, Venture Capital • Leave a comment

https://www.healthcaredive.com/news/unitedhealth-likely-to-keep-squeezing-physician-staffing-firms/573679/

Image result for UnitedHealth likely to keep squeezing physician staffing firms

The nation’s largest private insurer has been terminating its contracts with physician staffing firms in a bid to extract lower prices, part of a years-long pattern analysts say could spur other payers to follow.

UnitedHealthcare contends it is simply trying to curb the rising cost of healthcare by driving out high-cost providers that charge far more than the median rate in its network. The payer said it had hoped to keep these firms in network “at rates that reflect fair market prices,” a UnitedHealthcare spokesperson told Healthcare Dive.

The most recent action targeted Mednax, a firm that provides specialty services including anesthesia, neonatology and high-risk obstetrics in both urban and rural areas. United cut Mednax contracts in four states, pushing those providers out of network, potentially putting patients at risk of balance bills.

United also recently canceled its in-network contracts with U.S. Anesthesia Partners in Texas, starting in April, which caused Moody’s to change its outlook to negative for the provider group because the contracts represent 10% of its annual consolidated revenue.

These latest moves to end relationships with certain physician staffing firms seem to have escalated in recent years, Sarah Kahn, a credit analyst for S&P Global, told Healthcare Dive.

Since the insurer’s 2018 tussle with ER staffing firm Envision, “it’s sort of ramped up and become more aggressive and more abrupt and more pervasive,” Kahn said of the contract disputes.

 

United said the volume of negotiations it’s involved in has not changed in recent years, and added that it expects to renegotiate the same amount of contracts in 2020 that it did in 2019. However, United pointed a finger at a small number of physician staffing firms, backed by private equity, that are attempting to apply pressure on United to preserve the same high rates.

Private equity firms have been increasingly interested in healthcare over the past few years, accelerating acquisitions of medical practices from 2013 to 2016. Private equity acquired 355 physician practices, representing 1,426 sites of care and more than 5,700 physicians over that time frame, according to recent research in JAMA. The firms had a particular focus on anesthesiology with 69 practices acquired, followed by emergency physicians at 43.

Mednax is a publicly traded company. But Envision is owned by investment firm KKR; TeamHealth is owned by private equity firm Blackstone; and U.S. Anesthesia Partners is backed by Welsh, Carson, Anderson & Stowe.

 

Proposed legislation around surprise billing may be influencing United’s actions, Kailash Chhaya, vice president and senior analyst at Moody’s, told Healthcare Dive. Congress has been weighing legislation that seeks to eliminate surprise billing, mainly through two vehicles, either using benchmark rates or arbitration.

If Congress ultimately decides on a bill that uses benchmark rates, or ties reimbursement for out-of-network providers to a benchmark rate (or average), it would benefit insurers like United to lower its average rate for certain services, Chhaya said. One way to do that is to end relationships with high-cost providers.

“It would help payers like UnitedHealth if that benchmark rate is low,” Chhaya said.

In late 2018, United threatened to drop Envision from its network, alleging the firm’s rates were responsible for driving up healthcare costs, according to a letter the payer sent hundreds of hospitals across the country. United and Envision eventually agreed to terms, but United seemed to outmuscle Envision as the deal secured “materially lower payment rates for Envision” that resulted in lower earnings, S&P Global analysts wrote in a recent report.

In 2019, United began terminating its contracts with TeamHealth, which has a special focus on emergency medicine. The terminations affect two-thirds of TeamHealth’s contracts through July 1. The squeeze from United caused Moody’s to also change Team Health’s outlook to negative as an eventual agreement would likely mean lower reimbursement and lower profitability for company, the ratings agency said.

“They’re trying to lower their payments to providers. Period,” David Peknay, director at S&P Global, told Healthcare Dive.​

 

Data shows prices — not usage — is driving healthcare spending. Physician staffing firms are frequently used for ER services and the ER and outpatient surgery experienced the largest growth in spending between 2014 and 2018, according to data from the Health Care Cost Institute.

United said it had been negotiating with TeamHealth since 2017 and does not believe TeamHealth should be paid significantly more than other in-network ER doctors for the same services. United alleges its median rate for chest pains is $340. But if a TeamHealth doctor provides the care it charges $1,508.​

“As Team Health continues to see more aggressive and inappropriate behavior by payors to either reduce, delay, or deny payments, we have increased our investment in legal resources to address specific situations where we believe payor behavior is inappropriate or unlawful,” according to a statement provided to Healthcare Dive.

TeamHealth said it will not balance bill patients in the interim.

 

The pressure from payers, particularly United, is unlikely to relent. The payer insures more than 43 million people in the U.S. through its commercial and public plans.

“I don’t think anyone is safe from such abrupt terminations,” Kahn said. However, United disputes the characterization of abruptly terminating contracts and says in many cases it has been negotiating with providers to no avail.

Likely targets in the future may include firms with a focus on emergency services, which tend to be high-cost areas, S&P’s analysts said. In their latest report, Kahn and Peknay pointed to The Schumacher Group, which is the third-largest player in emergency staffing services. However, it commands a market share of less than 10%, far less than its rivals Envision and TeamHealth.

Smaller firms may not be able to weather the pressure as effectively as very large staffing organizations.

For those smaller groups, it may be wise for them “to sit tight on their cash or prepare from some pressure,” Kahn said.

Although some believe it may influence other payers to follow suit, Dean Ungar, vice president and senior analyst with Moody’s, said United may be uniquely placed to exert this pressure because it has its own group of providers it can use and considerable scale.

“They are better positioned to play hardball,” Ungar said.

 

 

 

 

White House to Walk Back 3 Policy Announcements

Posted on by • Posted in Coronavirus, Health Insurance Benefit Design, Health Insurance Coverage Adequacy, Health Insurance Industry, Health Policy, Infection Control, Infectious Virus, Out of Pocket Expenses, Pandemic, Public Health, Public Safety, Underinsured, Uninsured • Leave a comment

https://www.axios.com/trump-coronavirus-oval-office-speech-e0f6685f-ffd4-4e28-9794-0e16ee71321b.html

Image result for u turn

The White House had to walk back three policy announcements from President Trump’s Oval Office announcement Wednesday that are causing more confusion than comfort during the coronavirus outbreak.

Why it matters: COVID-19 is already here in the U.S., and in some communities, it’s spreading rapidly. Trump’s travel restrictions won’t stop the infection in states where person-to-person spread is rampant.

 

1) Europe travel ban: Trump said Americans will be exempt “who have undergone appropriate screenings.”

  • His words caused people in Europe to buy tickets at premium prices back to the U.S. in a panic, per the Washington Post.
  • But it will only apply to foreign nationals who have been in the Schengen region of Europe within 14 days of arrival in the U.S. It does not apply to permanent U.S. residents, citizens or immediate family of citizens, per the Department of Homeland Security.

 

2) Health insurers: “Have agreed to waive all copayments for coronavirus treatments,” Trump said.

  • But insurers have agreed to wave copayments for testing, not treatment.

 

3) Trade: The White House walked back Trump’s statement that the travel restrictions “apply to the tremendous amount of trade and cargo, but various other things as we get approval.”

 

The big picture: Although Trump spent extra time making sure businesses knew he’d ease economic uncertainty, stocks fell more than 8% on Thursday morning and halted briefly for the second time this week.

  • What to watch: More mayors and governors are handling outbreaks by limiting mass gatherings of a certain size. In Seattle, that’s no more than 250 people. In San Francisco and Washington, D.C., it’s no more than 1,000.