Category Archives: High Prices

Many Americans clueless about out-of-pocket medical costs, study finds

Posted on by • Posted in 2020 Election Issues, ACA, Bad Debt Expense, Health Insurance Coverage Adequacy, Health Policy, High Deductible Health Plans, High Drug Prices, High Premiums, High Prices, Out of Pocket Expenses, Underinsured, Uninsured • Leave a comment

https://www.beckershospitalreview.com/finance/many-americans-clueless-about-out-of-pocket-medical-costs-study-finds.html?origin=cfoe&utm_source=cfoe

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When it comes to out-of-pocket medical costs, many people are unaware of their potential financial burden, according to a new study released by Discover Personal Loans, a provider of banking tools and resources across various financing options.

For the study, researchers examined the average cost of certain medical procedures and compared them to perceptions of costs from 969 surveyed U.S. residents.

Four takeaways from the study:

1. Researchers found that a three-day hospitalization, knee replacement surgery and an appendectomy had the greatest variation of average actual costs compared to average perceived costs.

2. For example, surveyed Americans perceived the average cost of a three-day hospitalization to be $11,013, while the actual average cost posted on Healthcare.gov is about $30,000. That’s a variation of 63 percent.

3. The variation between average actual cost and average perceived cost for a knee replacement surgery and an appendectomy were 34 percent and 32 percent, respectively.

4. Surveyed Americans anticipate spending $2,016 for an emergency room visit, up 5 percent from the average actual cost from the Health Care Cost Institute and cited by CNN, $1,917.

Read more about the study here.

 

 

 

The plight of America’s rural health care

Posted on by • Posted in 2020 Election Issues, ACA, Bankruptcy, Health Insurance Coverage Adequacy, Health Policy, High Deductible Health Plans, High Drug Prices, High Premiums, High Prices, Out of Pocket Expenses, Patient Safety, Rural Health, Rural Hospital, Safety Net Hospitals, Safety-Net Providers, Underinsured, Uninsured • Leave a comment

https://www.axios.com/the-plight-of-americas-rural-health-care-a34b6c66-7674-4f78-abdc-33f8e711a601.html

Illustration of a tractor plowing a field in the shape of a heart monitor that is petering out

Rural America is stuck in a cycle of increasingly vulnerable patients with declining access to health care.

Why it matters: Rural patients often can’t afford care, are being hounded by hospitals and collection agencies over their unpaid bills, and are facing the reality of life in communities where the last hospital has closed.

Rural Americans tend to be older, sicker and lower-income than urban Americans. They suffer from higher rates of obesity, mental health issues, diabetes, cancer and opioid addiction, as my colleagues Stef Kight and Juliet Bartz reported.

  • They’re also more likely to be uninsured or covered by Medicare or Medicaid, which pay doctors and hospitals less than private insurance does.
  • A small and shrinking population, mostly covered by insurance plans that don’t pay very much, many of whom need a lot of care, puts more financial pressure on providers, especially hospitals. Physician shortages are common.

What they’re saying: “Rural hospitals have long been right there on the edge on average, and we’re seeing more and more of them flip over to red,” said Mark Holmes, a professor at UNC-Chapel Hill and director of the Cecil G. Sheps Center for Health Services Research.

And hospital closures often exacerbate the problems communities were already facing.

  • Hospitals are often the largest or second-largest employer in a rural community.
  • 113 rural hospitals have closed since 2010, according to the Sheps Center.
  • These are disproportionately located in the South — the region with the nation’s worst health outcomes, and where most states haven’t expanded Medicaid — leaving hospitals with more uninsured patients.
  • A 2018 study in Health Affairs found that Medicaid expansion is “associated with improved hospital financial performance and substantially lower likelihoods of closure, especially in rural markets.”

The bottom line: “What we have here is not one root cause; there’s multiple things going on here,” Holmes said. “All these sort of modest kind of trends are adding up to something that’s quite considerable.”

Go deeper:

  • Bloomberg Businessweek reported on eastern Montana’s sole psychiatrist, despite being the state with the nation’s highest suicide rate.
  • The Washington Post detailed a hospital in Missouri’s practice of suing its patients for payment — money that the hospital needed but patients generally don’t have.
  • Kaiser Health News and NPR have profiled the fallout in a rural community in Kansas after its sole remaining hospital closed, which included a 2-week lapse in nearby emergency care.

 

 

 

 

I’ve lived the difference between US and UK health care. Here’s what I learned

Posted on by • Posted in 2020 Election Issues, ACA, Health Insurance Coverage Adequacy, Health Insurance Industry, Health Policy, High Deductible Health Plans, High Drug Prices, High Premiums, High Prices, Out of Pocket Expenses, Single Payer Health System, Single Payer Healthcare System, Underinsured, Uninsured, Universal Healthcare System • 1 Comment

https://www.cnn.com/2019/08/07/opinions/single-payer-healthcare-beers/index.html?utm_source=Sailthru&utm_medium=email&utm_campaign=Newsletter%20Weekly%20Roundup:%20Healthcare%20Dive%2008-10-2019&utm_term=Healthcare%20Dive%20Weekender

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Earlier this year, I shattered my elbow in a freak fall, requiring surgery, plates and screws. While I am a US citizen, several years ago I married an Englishman and became a UK resident, entitled to coverage on the British National Health Service. My NHS surgeon was able to schedule me in for the three-hour surgery less than two weeks after my fall, and my physical therapist saw me weekly after the bone was healed to work on my flexion and extension. Both surgery and rehab were free at the point of use, and the only paperwork I completed was my pre-operative release forms.

Compare that to another freak accident I had while living in Boston in my 20s. I spilled a large cup of hot tea on myself, suffered second degree scald burns, and had to be taken to the hospital in an ambulance. In the pain and chaos of the ER admission, I accidentally put my primary insurance down as my secondary and vice versa. It took me the better part of six months to sort out the ensuing paperwork and billing confusion, and even with two policies, I still paid several hundred dollars in out-of-pocket expenses.
With debate raging in the US among Democrats about whether to push for a government health care system such as Medicare for All, there is no doubt in my mind that the NHS single-payer health care system is superior to the American system of private insurance.
As someone who suffers from chronic illness, is incredibly clumsy and accident-prone, and has two young children, I spend an inordinate amount of time in doctors’ offices and hospitals. When my family is in our home in York, England, our health care is paid for principally through direct taxation, and we have zero out of pocket costs.
In contrast, when we are in the US, we are on my employer-based insurance plan. After years with one provider, rising costs pushed the premiums alone to above 10% of my gross salary for the family plan, and I recently opted to switch to a new provider, whose premiums are a more modest but still eye-watering 7% of my salary. I have had to switch our family doctor and specialists, with the attendant hassle of applying to have our medical records released and transferred to our new providers. In addition to my premiums, both plans include significant co-pays, although my new provider does not have a deductible.

In Britain, I am not entitled to the annual well patient and women’s health check-ups that Americans can now receive without a co-pay or deductible thanks to the Affordable Care Act. As an asthma sufferer, I do, however, have regular annual reviews of my condition. When one of my children becomes ill, I am usually able to receive same-day treatment in both countries, although in both cases this involves showing up early for the urgent care clinic.
The comparative ease and security of the NHS is why the system retains such high levels of support from the British public, despite frustrations with wait times and other aspects of service provision. A recent poll found that 77% of respondents felt that “the NHS is crucial to British society and we must do everything we can to maintain it,” and nearly 90% agreed that that the NHS should be free at the point of delivery, provide a comprehensive service available to everyone, and be primarily funded through taxation. Britons’ affection for their NHS was dramatically enacted in Danny Boyle’s 2012 Olympic opening ceremony extravaganza.
Yet, while I share my adopted countrymen’s support for the NHS, I can see almost no chance of America adopting a single-payer health care system of the kind described by Sens. Sanders and Warren any time soon. Sanders, Warren and other single-payer advocates not only face a strong and entrenched adversary in the American insurance industry, they also lack the broad public support for reform which characterized post-WWII Britain.
That broad public support for reform was crucial. Britain’s NHS system was very nearly defeated by opposing interests when it was introduced in the 1940s. It was initially opposed by the municipal and voluntary authorities, who controlled the 3,000 hospitals which Health Secretary Aneurin Bevan sought to bring under national administration, by the various Royal Colleges of surgeons and specialists, and by British Medical Association (BMA), the professional body representing the vast majority of the nation’s general practitioners, who stood to lose control of their private practices and become state employees.
At a meeting of doctors following the publication of Bevan’s proposals in January 1946, one physician claimed that “This Bill is strongly suggestive of the Hitlerite regime now being destroyed in Germany,” and another described the proposed nationalization of the hospitals as “the greatest seizure of property since Henry VIII confiscated the monasteries.” The BMA hostility persisted through rounds of negotiations lasting two years. Less than six months before the bill was set to come into effect on July 5, 1948, the BMA’s membership voted by a margin of 8 to 1 against the NHS, sparking serious fears within the government that GPs would refuse to come on board, effectively scuppering the NHS.
Bevan insisted that he would not cave but he did have to make several costly concessions to bring the doctors on board. First, he cleaved off the specialists (who were closely tied to the hospitals), by promising them that, if they signed on, they could continue to treat private patients in NHS-run hospitals in addition to their NHS patients, whom they would be paid to treat on a fee-for-service basis. Then, he offered the general practitioners a generous buyout to give up their stake in their private practices (effectively purchasing their patient lists), if they came on board. And finally, he promised them that the government would not be able to compel them to become fully salaried employees of the state without the passage of new legislation.
At the same time that Bevan offered the carrot of economic concessions, he also wielded the stick of public opinion against the doctors. Speaking in the House of Commons in February 1948, Bevan positioned single-payer healthcare as an issue of middle class survival, in language whose substance, if not its style, would not sound out of place in a 2020 Democratic primary debate: “Consider that social class which is called the “middle class.” Their entrance into the scheme, and their having a free doctor and a free hospital service, is emancipation for many of them. There is nothing that destroys the family budget of the professional worker more than heavy hospital bills and doctors’ bills.”
Bevan spoke for a public exceptionally united in support of an expanded state welfare policy as a result of the socially unifying experience of World War II. Fear of public backlash combined with economic incentives ultimately brought the medical establishment to heel.
Many were shocked when Bevan succeeded, but the BMA was arguably a less formidable threat to reform then than the American insurance industry is now. Insurance companies stand to be the biggest losers from a switch to single-payer health care, which seeks to achieve economies in large part through cutting out the profit-making middle man. As Elizabeth Warren noted in last Tuesday’s debate, US insurance companies reported $23 billion in profits last year. And the insurance lobby is determined to protect its position. That is why insurance companies are major donors in both state and federal election campaigns. The insurance industry has put massive resources into ensuring continued public and political opposition to the introduction of a single-payer system.
It’s possible that, if Americans were presented with an arguably cheaper and less bureaucratic health care system, they might decide that they liked it and were committed to doing everything they could to maintain it. But given the constellation of political forces in 21st century America, that just isn’t going to happen any time soon.

Myth Diagnosis: Do hospitals charge more to make up for low government pay?

Posted on by • Posted in 2020 Election Issues, Capitation, Global Payment, Health Policy, Health System, High Premiums, High Prices, Hospital, Hospital Industry, Managed Care, Market Consolidation, Market Power, Value-Based Healthcare • Leave a comment

https://www.healthcaredive.com/news/myth-diagnosis-do-hospitals-charge-more-to-make-up-for-low-government-pay/560021/

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It’s a mantra from providers to justify the disparate prices charged patients depending on their level of insurance coverage: It’s all in the name of cost shifting to make up for stingy government reimbursement.

The idea is that hospitals bill commercial payers more to make up for low rates from government payers and the costs from treating the uninsured. Providers and payers both insist the practice occurs, but academics are skeptical — and the notion is notoriously difficult to measure.

No one is doubting that the prices are different depending on who is footing the bill. The issue is whether they are dependent on each other.

“What is crystal clear is that there’s a huge unit cost payment differential between government and commercial payers,” John Pickering of Milliman told Healthcare Dive. “What isn’t clear is whether there’s a causal effect between those two.”

Heath economists, doctors and industry executives have been arguing about whether hospitals perform cost shifting for at least 40 years.

Government efforts to tamp down on runaway payments to providers may have sparked the debate. These include Medicare’s shift from strictly fee-for-service reimbursement to the prospective payment system in the 1980s.

Also, the Affordable Care Act attempted to codify efforts to pay providers based on performance with initiatives like the Hospital Readmission Reduction Program and alternative payment models.

Part of the difficulty is untangling factors like differences in geography, quality and market share, said Michael Darden, an associate professor at Carey Business School.

The body of research on healthcare cost shifting is mixed. There is evidence that some hospitals perform cost shifting, but not strong and clear results showing hospitals make such adjustments consistently or what exactly is causing them.

The debate has received some renewed attention as more states approve Medicaid expansion under the ACA and as employers consider offering high-deductible health plans that patients on the hook for more costs, Rick Gundling, senior vice president for healthcare financial practices with the Healthcare Financial Management Association, told Healthcare Dive.

“As folks get more price-sensitive through higher cost-sharing with patients and employers and these types of things — it’s certainly talked about. As it should be,” he said.

Policy implications

The topic may get even more attention as healthcare has come to dominate the early days of the 2020 presidential election, at least among the 20-plus contenders running in the primary.

While still a long way off, a “Medicare for All”-type system seems closer than any time in recent history.

While not all of the proposals explicitly or fully eliminate the private insurance industry, some (including those put forward by Sens. Bernie Sanders, I-Vt., and Elizabeth Warren, D-Mass.,) do, and others would at least severely curtail it. One key question for those plans is whether government rates would have to increase in order to keep hospitals and providers above water, and if so, by how much.

To counter, President Donald Trump and his administration have stepped up their scrutiny of industry billing practices. These efforts include pushing Congress to ban surprise billing and executive orders to revamp kidney care in the country and advance price transparency.

For their part,  providers say they’ll be forced to raise other rates if government programs pay less. Insurers will say the phenomenon means they must raise premiums to keep up.

In a statement to Healthcare Dive, America’s Health Insurance Plans pointed the finger at rising hospital prices, spurred in part from provider consolidation. The payer lobby argued health plans do their best to keep out-of-pocket costs affordable for customers through payment negotiations and by offering a number of coverage options.

“However, insurance premiums track directly with the underlying cost of medical care. The rising cost of doctor’s visits, hospital stays, and prescription medications all put upward pressure on premiums,” the group said.

Employers care about this issue as well, especially those that self-insure, said Steve Wojcik, vice president of public policy for the National Business Group on Health. Coverage can get expensive for businesses because they don’t get as good of a deal as government payers, he told Healthcare Dive.

Wojcik suggested more radical change away from fee-for-service payment arranges would be a better way of dealing with the issue. It’s an argument for many who push the healthcare sector’s slow march toward paying for quality and not quantity of treatment.

“I think, ultimately, it’s about driving transformation in healthcare delivery so that there’s more of a global payment for managing someone’s health or the health of a population rather than paying piecemeal for different services, which I think is inflationary,” he said.

Regardless, whether hospitals cost shift isn’t as important as whether they go out of business. “We may be missing the point if we focus on cost shifting,” Christopher Ody, a health economist at Northwestern University’s Kellogg School of Management, told Healthcare Dive.

Charging as much as they can?

A paper Darden helped author in the National Bureau of Economic Research found some hospitals that faced payment reductions from value-based Medicare programs did negotiate slightly higher average payments from private payers.

Health economist Austin Frakt noted the ability to negotiate better pricing could be related to quality improvement these hospitals likely undertook, knowing their quality measures would directly affect future payments.

It comes back to determining causality, Frakt, who holds positions with the Department of Veteran’s Affairs, Boston University and Harvard, told Healthcare Dive.

“It’s an important distinction, because the simplest economic model which is consistent with the evidence is that hospitals charge as much as they can to each type of payer,” he said. “So, they can’t really change what they receive from Medicare — those prices are fixed. But they charge private payers whatever the revenue- or profit-maximizing price is.”

Hospitals assert there is causality, but haven’t pointed to evidence that convinced Frakt of their argument. Frakt, for the record, understand why hospitals make the argument to policymakers, however.

“I’m not implying that this, throughout, is just to make a profit,” he said. “I think it’s possible to also have the best interests of patients in mind and to have this argument.”

Grundling said there has to be a breaking point somewhere so long as government rates fail to keep up with medical inflation. Also, hospitals have a federal legal responsibility to stabilize any patient regardless of ability to pay and have other philanthropic investments.

“It just puts a greater pressure on other payers in the system,” he said.

Frakt said the argument providers give for cost shifting doesn’t necessarily make sense for the average consumer. “It’s very strange that people find it intuitive that hospitals can readily cost shift because we don’t talk about any other industry like that,” he said. “Nobody says, well, my theater tickets was so much higher because you paid less.”

The idea that healthcare is vastly different from other industries is enduring, however, he said. “People don’t even want to think of healthcare as having prices,” he said. “How do you put a price on that?”

 

Republicans ready to revive ACA repeal talks

Posted on by • Posted in 2020 Election Issues, ACA, Essential Health Benefits, Health Insurance Coverage Adequacy, High Deductible Health Plans, High Drug Prices, High Premiums, High Prices, Medicaid, Medicaid Block Grants, Medical Loss Ratio (MLR), Medicare Buy-In, Medicare for All, Out of Pocket Expenses, Preexisting Conditions, Public Option • Leave a comment

https://www.beckershospitalreview.com/hospital-management-administration/republicans-ready-to-revive-aca-repeal-talks.html

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Sen. Lindsey Graham, R-S.C., promised to revive ACA repeal in Congress if Republicans can win back a majority in the House and reelect President Donald Trump in 2020, according to an interview on South Carolina radio show “The Morning Answer with Joey Hudson,” featured by The Hill. 

“This is what 2020 is about: If we can get the House back, and keep our majority in the Senate, and President Trump wins reelection, I can promise you, not only are we going to repeal Obamacare, we are going to do it in a smart way where South Carolina would be the biggest winner,” Mr. Graham said.

Mr. Graham, who failed to pass an ACA repeal plan in 2017, called “Medicare for All” and other Democratic presidential candidates’ healthcare plans “crazy.”  

“Medicare for All is $30 trillion, and it’s going to take private sector healthcare away from 180 million Americans,” he said. Instead, he proposed giving states the power to determine healthcare policy through block grants and other smaller reforms. This would allow states to test conservative healthcare policies against liberal ones, he said. 

“This election has got a common thing: Federalism versus socialism,” Mr. Graham said. “What I want to do is make sure the states get the chance to administer this money using conservative principles if you are in South Carolina, and if you want Medicare for All in California, knock yourself out.”

Anthem again irks docs with latest changes to reimbursement

Posted on by • Posted in American Medical Association (AMA), Cost Management, Cost Reduction, Health Insurance Coverage Adequacy, Health Insurance Industry, High Prices, Physician, Physician Practice Management, Primary Care, Rev Cycle Management • Leave a comment

https://www.healthcaredive.com/news/anthem-again-irks-docs-with-latest-changes-to-reimbursement/559747/

Anthem is again ruffling the feathers of providers, this time over a new reimbursement policy denying payment for certain follow-up office visits the same day a procedure is performed. 

The policy could impact many specialists and primary care doctors. Dermatologists are particularly upset over the change, which they call punitive and unnecessary with the potential to disrupt patient care.

“It is a nuisance. It makes absolutely no sense,” George Hruza, a practicing dermatologist and president of the American Academy of Dermatology, told Healthcare Dive.

It’s the latest in a string of controversial policies from Anthem. The Blue Cross payer that insures 40 million people has taken steps to rein in costs by enforcing different payment policies based on site of care and other factors. 

In the past several years, the Indianapolis-based for-profit said that it would no longer pay for emergency room visits if patients show up with minor ailments like the common cold. It also stopped paying for certain imaging tests at outpatient facilities owned by hospitals due to the unexplained wide variation in costs compared with freestanding imaging centers.

And this year, Anthem cut rates paid to hospital-based labs in an attempt to align them with independent labs, a strategy that garnered extensive discussion on lab giant Quest Diagnostic’s second quarter earnings call.

Anthem contends the latest change to office visit payments will prevent duplicative billing for similar visits. The change took effect March 1, according to a previous provider alert. Anthem told Healthcare Dive it’s an update to its claims systems and does not describe it as a new reimbursement policy.

Despite conversations with Anthem, Hruza said his organization hasn’t been given an explanation on what triggered the change and whether it actually addresses a problem or an abuse of the system. He said he understands the need to cut healthcare costs, but wonders how much savings the change will generate as some of the visits are below $100.

The payer proposed an almost identical change last year but later decided to pull it back after intense pushback from the American Medical Association and other provider groups. The newer policy is worse because doctors would receive no payment, and it’s more narrowly tailored to the same diagnosis, Hruza said.

‘Appropriate settings’

Anthem argues the policy is needed to move care to more cost-efficient settings.

“Our efforts to help achieve that goal include a range of initiatives that, among other things, encourage consumers to receive care in the most appropriate setting and also help promote accurate coding and submission of bills by providers,” Anthem said in a statement to Healthcare Dive.

Hruza is worried the latest iteration would cause patients delays in care.

He gave the example of a patient with acne prescribed a medication. He would want to see them for a follow-up in a few weeks. At that second appointment, if he saw the treatment wasn’t working well, he might prescribe a different medication. At the same time, he may drain an acne cyst, a minor procedure. That would trigger a denial, he said, because of the two visits revolving around the same diagnosis with the same-day procedure.

AMA is aware of the policy and has had meetings with Anthem about its concerns, a source for the organization that represents the nation’s doctors told Healthcare Dive.

For providers, the big fear is the change will result in unjustified claim denials and encourage other payers to adopt similar measures. Hruza said there is no recourse for contracted providers, particularly those that work in smaller practices, when these changes are made, given Anthem’s size as the nation’s second-largest insurer.

As deductibles rise and patients are shouldering a greater burden of the cost of care, insurers may be feeling the pressure from employers to wring out costs from the provider side, Sabrina Corlette, a research professor at the Center on Health Insurance Reforms at Georgetown University, told Healthcare Dive.

“Employers are getting more and more wise to the fact that the reason we have a cost problem in this country is because of provider prices,” Corlette said. 

 

 

 

Trump to Sign Medicare Order as Part of Attack on Democrats’ Health-Care Message

Posted on by • Posted in 2020 Election Issues, ACA, Essential Health Benefits, Executive Orders, Health Insurance Coverage Adequacy, Health Policy, Health System, High Deductible Health Plans, High Drug Prices, High Premiums, High Prices, Hospital, Hospital Industry, Out of Pocket Expenses, Preexisting Conditions • Leave a comment

https://www.wsj.com/articles/trump-administration-proposal-would-allow-prescription-drug-imports-from-canada-11564580906?utm_source=Sailthru&utm_medium=email&utm_campaign=Newsletter%20Weekly%20Roundup:%20Healthcare%20Dive%2008-03-2019&utm_term=Healthcare%20Dive%20Weekender

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Administration moves ahead to bolster Medicare Advantage plans and authorize lower-cost drug imports from Canada, as it takes on Medicare for All.

President Trump is preparing to sign an executive order next week on Medicare and moving ahead with allowing some drug imports from Canada, part of the administration’s effort to engineer a response to Democratic proposals that candidates say would expand health coverage to all Americans.

The executive order would aim to strengthen Medicare for 44 million Americans and portray the president as defending it against Democrats who want to expand it nationwide under their Medicare for All strategy, a White House official said Wednesday.

The administration on Wednesday also said it would allow the imports of some drugs from Canada, backing an idea most Democratic candidates have also said they support. More executive orders, including one on drug prices, are possible, according to a person familiar with the plans.

Mr. Trump is taking a two-pronged approach to his 2020 campaign message on health care, attacking Medicare for All as socialism and rolling out a blitz of health-care initiatives intended to position him as the person who can drive down costs and protect health care.

The president is expected to contrast the Democrats’ plans with his in a speech set for Aug. 6. “He’s going to indict and impugn the idea of Medicare for All,” a White House official said of the speech. Senior White House aides and agency officials are holding meetings several times a week on health care plans, the official said.

Democratic challengers say Mr. Trump has endangered coverage by backing cuts to Medicare and a lawsuit that could dismantle the Affordable Care Act.

“We are not about trying to take away health care from anyone,” Massachusetts Democratic Sen. Elizabeth Warren said during the candidates’ debate Tuesday. “That’s what the Republicans are trying to do.”

This week, the administration proposed a rule that would compel hospitals to disclose discounted rates with insurers. The president signed an executive order to overhaul kidney-disease care, and the White House relaxed restrictions on pretax health savings accounts so the money can be used on treatment to prevent disease.

Mr. Trump is expected to sign the Medicare executive order next week at The Villages, a Florida retirement community with 120,000 residents that is majority Republican.

Mr. Trump may call for agency action to bolster Medicare Advantage plans, which private insurers offer under contract with Medicare and cover about 22 million people, according to two people familiar with the executive order. The president is likely to focus on curbing waste and abuse in Medicare that can add to the program’s cost. In addition, the order may aim to let Medicare Advantage plans offer a wider array of supplemental benefits. The administration has already taken steps in this direction by letting home health-care providers become partners in the Medicare Advantage contracts.

Mr. Trump also is expected to push for changes that could lower the price of patient visits to hospital outpatient clinics, two of the people said. Those visits can cost more than visits to clinics operated by doctors. “This is part of the president’s broader vision to put American patients first,” one person familiar with the executive order said.

A White House spokesman declined to confirm the details or comment on the executive order.

House Republicans and Health and Human Services Secretary Alex Azar have criticized the plans from Democrats, saying they would end Medicare Advantage and imperil the Medicare program, which covers 44 million Americans.

“Our administration wants to strengthen the program, protect the program, make sure it’s sustainable over the long term,” Seema Verma, administrator at the Centers for Medicare and Medicaid Services, said Wednesday at a press event. “We need to work toward that instead of forcing so many more people onto the program.”

 

 

 

Democratic Debate Turns Ferocious Over Health Care

Posted on by • Posted in 2020 Election Issues, ACA, Health Insurance Coverage Adequacy, Health Policy, High Deductible Health Plans, High Drug Prices, High Premiums, High Prices, Medicare, Medicare Buy-In, Medicare for All, Out of Pocket Expenses, Public Option, Single Payer Health System, Single Payer Healthcare System, Underinsured, Uninsured, Universal Healthcare System • Leave a comment

Candidates in the first night of this week’s Democratic presidential debates sparred over health care coverage.

It took only one question — the very first — in Tuesday night’s Democratic presidential primary debate to make it clear that the issue that united the party in last year’s congressional elections in many ways now divides it.

When Jake Tapper of CNN asked Senator Bernie Sanders whether his Medicare for All health care plan was “bad policy” and “political suicide,” it set off a half-hour brawl that drew in almost every one of the 10 candidates on the stage. Suddenly, members of the party that had been all about protecting and expanding health care coverage were leveling accusations before a national audience at some of their own — in particular, that they wanted to take it away.

“It used to be Republicans that wanted to repeal and replace,” Gov. Steve Bullock of Montana said in one of the more jolting statements on the subject. “Now many Democrats do as well.”

Those disagreements set a combative tone that continued for the next 90 minutes. The health care arguments underscored the powerful shift the Democratic Party is undergoing, and that was illustrated in a substantive debate that also included trade, race, reparations, border security and the war in Afghanistan.

In the end, it was a battle between aspiration and pragmatism, a crystallization of the struggle between the party’s left and moderate factions.

It is likely to repeat itself during Wednesday night’s debate, whose lineup includes former Vice President Joseph R. Biden Jr. and Senator Kamala Harris of California. He supports building on the Affordable Care Act by adding an option to buy into a public health plan. She released a proposal this week that would go further, eventually having everyone choose either Medicare or private plans that she said would be tightly regulated by the government.

Democrats know all too well that the issue of choice in health care is a potent one. When President Barack Obama’s promise that people who liked their health plans could keep them under the Affordable Care Act proved to be untrue, Republicans seized on the fallout so effectively that it then propelled them to majorities in both the House and Senate.

On Tuesday night, Representative Tim Ryan of Ohio evoked those Republican attacks of years ago on the Affordable Care Act, saying the Sanders plan “will tell the union members that give away wages in order to get good health care that they will lose their health care because Washington is going to come in and tell them they have a better plan.”

Republicans watching the debate may well have been smiling; the infighting about taking away people’s ability to choose their health care plan and spending too much on a pipe-dream plan played into some of President Trump’s favorite talking points. Mr. Trump is focusing on health proposals that do not involve coverage — lowering drug prices, for example — as his administration sides with the plaintiffs in a court case seeking to invalidate the entire Affordable Care Act, putting millions of people’s coverage at risk.

It was easy to imagine House Democrats who campaigned on health care, helping their party retake control of the chamber, being aghast at the fact that not a single candidate mentioned the case.

Mr. Sanders’s plan would eliminate private health care coverage and set up a universal government-run health system that would provide free coverage for everyone, financed by taxes, including on the middle class. John Delaney, the former congressman from Maryland, repeatedly took swings at the Sanders plan, suggesting that it was reckless and too radical for the majority of voters and could deliver a second term to Mr. Trump.

Mr. Sanders held firm, looking ready to boil over at time — “I wrote the damn bill,” he fumed after Mr. Ryan questioned whether benefits in his plan would prove as comprehensive as he was promising. Senator Elizabeth Warren of Massachusetts, the only other candidate in favor of a complete overhaul of the health insurance system that would include getting rid of private coverage, chimed in to back him up.

At one point she seemed to almost plead. “We are not about trying to take away health care from anyone,” she interjected. “That’s what the Republicans are trying to do.”

Mr. Delaney has been making a signature issue of his opposition to Medicare for all, instead holding up his own plan, which would automatically enroll every American under 65 in a new public health care plan or let them choose to receive a credit to buy private insurance instead. He repeatedly disparaged what he called “impossible promises.”

He was one of a number of candidates — including Beto O’Rourke, the former congressman from Texas; Senator Amy Klobuchar of Minnesota and Mayor Pete Buttigieg of South Bend, Ind. — who sought to stake out a middle ground by portraying themselves as defenders of free choice with plans that would allow, but not force, people to join Medicare or a new government health plan, or public option. (Some candidates would require people to pay into those plans, while others would not.)

The debate moderators also pressed Mr. Sanders and Ms. Warren on whether the middle class would have to help pay for a Sanders-style plan, which would provide a generous set of benefits — beyond what Medicare covers — to every American without charging them premiums or deductibles. One of the revenue options Mr. Sanders has suggested is a 4 percent tax on the income of families earning more than $29,000.

In defending his plan, Mr. Sanders repeatedly pointed out how many Americans are uninsured or underinsured, unable to pay high deductibles and other out-of-pocket costs and thus unable to seek care.

Analysts often point out that the focus on raising taxes to pay for universal health care leaves out the fact that in exchange, personal health care costs would drop or disappear.

“A health reform plan might involve tax increases, but it’s important to quantify the savings in out-of-pocket health costs as well,” Larry Levitt, executive vice president for health policy at the nonpartisan Kaiser Family Foundation, tweeted during the debate. “Political attacks don’t play by the same rules.”

A Kaiser poll released Tuesday found that two-thirds of the public supports a public option, though most Republicans oppose it. The poll also found about half the public supports a Medicare for all plan, down from 56 percent in April. The vast majority of respondents with employer coverage — which more than 150 million Americans have — rated it as excellent or good.

In truth, Mr. Delaney’s own universal health care plan could also face political obstacles, not least because it, too, would cost a lot. He has proposed paying for it by, among other steps, letting the government negotiate drug prices with pharmaceutical companies and requiring wealthy Americans to cover part of the cost of their health care.

Had Mr. Sanders not responded so forcefully to the attacks, it would have felt like piling on, though some who criticized his goals sounded more earnest than harsh.

“I think how we win an election is to bring everyone with us,” Ms. Klobuchar said, adding later in the debate that a public option would be “the easiest way to move forward quickly, and I want to get things done.”

 

 

Politicians Tackle Surprise Bills, but Not the Biggest Source of Them: Ambulances

Posted on by • Posted in Ambulance, Balance Billing, Health Policy, High Prices, Out of Network, Out of Pocket Expenses, Rev Cycle Management, Surprise Bills • Leave a comment

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A legislative push in Congress and states to end unexpected medical bills has omitted the ambulance industry.

After his son was hit by a car in San Francisco and taken away by ambulance, Karl Sporer was surprised to get a bill for $800.

Mr. Sporer had health insurance, which paid for part of the ride. But the ambulance provider felt that amount wasn’t enough, and billed the Sporer family for the balance.

“I paid it quickly,” Mr. Sporer said. “They go to collections if you don’t.”

That was 15 years ago, but ambulance companies around the nation are still sending such surprise bills to customers, as Mr. Sporer knows well. These days, he oversees the emergency medical services in neighboring Alameda County. The contract his county negotiated allows a private ambulance company to send similar bills to insured patients.

In most parts of medical care, you can choose a doctor or hospital that takes your insurance. But there are some types of care where politicians have begun tackling the “surprise” bills that occur when, say, patients go to an emergency room covered by their insurance and are treated by a physician who is not.

Five states have passed laws this year to restrict surprise billing in hospitals and doctor’s offices. Congress is working on a similar package of measures, after President Trump held a news conference in May urging action on the issue.

But none of these new policies will protect patients from surprise bills like the one Mr. Sporer received. Ordinary ambulances that travel on roads have been left out of every bill.

“Ambulances seem to be the worst example of surprise billing, given how often it occurs,” said Christopher Garmon, a health economist at the University of Missouri-Kansas City. “If you call 911 for an ambulance, it’s basically a coin flip whether or not that ambulance will be in or out of network.”

Mr. Garmon’s research finds that 51 percent of ground ambulance rides will result in an out-of-network bill. For emergency room visits, that figure stands at only 19 percent.

Congress has shown little appetite to include ambulances in a federal law restricting surprise billing. One proposal would bar surprise bills from air ambulances, helicopters that transport patients who are at remote sites or who have life-threatening injuries. (These types of ambulances tend to be run by private companies.)

But that interest has not extended to more traditional ambulance services — in part because many are run by local and municipal governments.

Lamar Alexander, the chairman of the Senate Committee on Health, Education, Labor and Pensions, and a key author of a Senate surprise billing proposal, said in an email that surprise bills from air ambulances were the more pressing issue because federal law prevents any local regulation of their prices. “Unlike air ambulances, ground ambulances can be regulated by states,” said Mr. Alexander, a Republican from Tennessee. “And Congress should continue to learn more about how to best solve that problem.”

The ambulance industry has brought its case to Capitol Hill, arranging meetings between members of Congress and their local ambulance operators.

“When we talk to our members of Congress, what we really emphasize is that we’re a little different from the other providers in the surprise billing discussion,” said Shawn Baird, president-elect of the American Ambulance Association. “We have a distinct, public process. The emergency room isn’t subject to any oversight of that kind.”

Patient advocates contend that this public oversight isn’t doing enough to protect patients, who often face surprise bills and forceful collection tactics from ambulance providers.

Anthony Wright, executive director of Health Access California, worked on a 2016 California law to restrict surprise billing. Initially, he thought it made sense to include ambulances in that legislation.

“It’s our experience that ambulance providers bill quicker and are more aggressive in sending bills to collection,” Mr. Wright said. “If they’re being more aggressive, you might want legislation to deal with that one first.”

But obstacles quickly began to mount. Some were about policy, like whether California would need to offset the revenue local governments would lose.

Then there were the politics. “There is the political reality that it’s hard to go after an entire industry at once,” Mr. Wright said. “It’s hard to have a bill opposed by doctors and hospitals and ambulances. We did manage to get a strong protection against doctor billing, but that was an epic, brutal, three-year fight.”

The California law that passed in 2016 did not regulate ambulance prices.

Patient groups elsewhere also say they ran into political trouble. Of the five states that passed surprise billing regulations in 2019, only Colorado’s new law takes aim at ambulance billing — not by regulating it, but by forming a committee to study the issue.

“The surprise bills laws are hard enough to get,” said Chuck Bell, program director for advocacy at Consumer Reports, who worked to pass a Florida surprise billing law in 2016. “You’re struggling with health plans, hospitals and doctors and other provider groups. At a certain point you don’t want to invite another big gorilla in the room to further widen the brawl.”

On Capitol Hill, the ambulance services have been less aggressive than other health care providers in lobbying against their inclusion in reforms. But lawmakers have largely declined to even include them in the conversation.

Consumer advocates say the lack of state-level legislation has been a barrier.

“Since there are issues related to ambulances being run by municipalities, and, at the state level, there hasn’t been a lot of model law to inform federal law, I think that’s made some members hesitant to wade into that space,” said Claire McAndrew, the director of campaigns and partnerships at the health care consumer group Families USA.

Local governments generally finance their ambulance services through a mix of user fees and taxes. If ambulances charge less to patients, they typically need more government funding.

Municipal governments often publish the prices of their ambulance services online, and they can range substantially. In Moraga and Orinda, in the Bay Area, the base rate for an ambulance ride is $2,600, plus $42 for each mile traveled. In Marion County, Fla., the most basic kind of ambulance ride costs $550, plus $11.25 per mile.

In many communities, there is no choice of ambulances.

Older patients are not charged such fees. Medicare, which also covers some people with disabilities, pays set prices for ambulance rides — a base rate of around $225 for the most typical type of care, in addition to a mileage fee — and forbids the companies to send patients additional bills.

In Bucks County, Pa., where it is $1,500 for a basic ambulance ride, in addition to $16 per mile, the emergency medical service gets 78 percent of its revenue from ambulance billing, according to Chuck Pressler, the executive director of the Central Bucks Emergency Medical Services. The rest of the budget comes from taxes raised by local cities and fund-raising drives.

“There is an expectation that we just plant money trees, that people should come in and work for free,” Mr. Pressler said of proposals to tamp down ambulance billing. “When was the last time you saw the police send out a fund-raiser? They don’t have to do that. Why do we have to raise money to come get you when you’re sick?”

 

 

 

Out-of-pocket costs rising even as patients transition to lower-cost care settings

Posted on by • Posted in 2020 Election Issues, Consumerism, Denial Rates, Emergency Care, Health Insurance Coverage Adequacy, Health Policy, Health System, Healthcare Financial Management Association (HFMA), High Deductible Health Plans, High Drug Prices, High Prices, Highly Specialized Drugs, Hospital, Hospital Industry, Out of Pocket Expenses, Primary Care, Rev Cycle Management, Urgent Care • Leave a comment

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Patients saw increases of up to 12% in their out-of-pocket responsibilities for inpatient, outpatient and ED care in 2018.

A new TransUnion Healthcare analysis has found that most patients likely felt a bigger pinch to their wallets as out-of-pocket costs across all settings of care increased in 2018. The new findings were made public yesterday at the 2019 Healthcare Financial Management Association Annual Conference in Orlando.

The analysis reveals that patients experienced annual increases of up to 12% in their out-of-pocket responsibilities for inpatient, outpatient and emergency department care last year.

In 2017, the average inpatient cost was $4,068; the average outpatient cost was $990; and the average emergency department cost was $577.

In 2018, the average inpatient cost was $4,659; the average outpatient cost was $1,109; and the average emergency department cost was $617.

FUELING THE TREND

There are certain factors that are influencing this trend, according to Jonathan Wiik, principal of healthcare strategy at TransUnion Healthcare.

“Patients are becoming more aware that emergency care is expensive and somewhat inefficient,” Wiik said. “No one wants to go to the emergency room unless we have to, because we don’t want to deal with the time there or the expense. They aren’t the best place to get primary or even urgent care.”

Another factor, he said, is that providers realize the emergency department is a care setting of last resort for many. Providers want to make sure that have room in the ED for cases that are real emergencies, so they’re essentially curating their patients, steering patients to the most cost effective settings possible — often primary care, which is the least expensive setting.

Noting that the biggest annual increases were in inpatient and outpatient care, Wiik said that was largely a function of utilization and just a general wariness, in addition to the fact that most EDs have pretty flat contracts. Financial communication with patients is also an issue.

“Most people can’t afford the average out-of-pocket, so providers are really trying to educate patients as early as they can about those costs,” said Wiik. “Emergency care is a really hard place to educate people on finances, let alone collect on them.”

RISING COSTS

The analysis found that, during a hospital visit, patients are likely experiencing cost increases that continue the trend of higher out-of-pocket costs. About 59% of patients in 2018 had an average out-of-pocket expense between $501 and $1,000 during a healthcare visit. This was a dramatic increase from 39% in 2017. Conversely, the number of patients that had an average out- of-pocket expense of $500 or below decreased from 49% in 2017 to 36% in 2018.

And with out-of-pocket costs increasing, the trend toward consumerism is growing as more patients, payers and providers transition to lower cost settings of care.

One example: Inpatient care, traditionally the most expensive healthcare option, has seen a leveling off with the percentage of price estimates remaining at 8% between 2017 and 2018. The percentage of outpatient services estimates, generally about one-quarter of the cost of inpatient services, rose in that same timeframe from 65% to 73%.

“Patients are likely seeing more providers and payers recommending that they take advantage of cost-effective healthcare options, which brings down costs for all parties,” said Wiik. “This is especially important as costs continue to rise in all areas of healthcare, particularly in inpatient, outpatient and emergency department services.”

This is having an impact on providers, payers and patients, he said.

“Let’s pretend Joanna had an MRI in her head, and that ran $3,200. That might have been paid by Blue Cross Blue Shield, and $100 out of Joanna’s pocket. Now Joanna’s paying $300. Most patients don’t look up how much the MRI’s going to be. They just get the bill later and try to figure it out. I think the patient portion of the bill is going to be in the 35, 40% range very soon. What that means is we’re quickly approaching half of the bill coming from the patient and half from the payer. That’s not insurance anymore, that’s a bank account.”

A recent Kaiser Family Foundation study indicated that 34% of patients are finding it difficult to pay their deductible before insurance kicks in. In addition to patients being challenged to make payments, the trend is that providers are also feeling the pressure of increased denial rates and write-offs, which is increasing bad debt.

Considering these factors together — increased out-of-pocket expenses, a patient’s challenge to make payment, and increased denial rates — collecting payments from all payers is critical for providers. In order for providers to ensure they receive payment for the patient-care services rendered, it is vital that they implement strategies that maximize reimbursements.