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The ACA Protects People with Preexisting Conditions; Proposed Replacements Would Not
The Affordable Care Act’s health insurance marketplaces open for enrollment today for the sixth time. But this year the marketplace health plans in many states will face some new competition from insurance products that don’t meet the law’s standards, including the ban on denying coverage or charging more based on a person’s preexisting health conditions.
New Trump administration regulations released earlier this year have undermined the coverage protections in the ACA by making it possible for insurers to renew often skimpy short-term health insurance for up to three years, and for small businesses to form associations that sell substandard health plans. One of the reasons insurers can charge low premiums for these plans is that they generally cover less that ACA-compliant plans and insurers can deny them to people with diabetes or a history of cancer, for example. Only healthy people get these plans. And the more healthy people who buy them, the more expensive coverage becomes for people with a history of illness who buy their own insurance and have incomes too high to qualify for marketplace subsidies. In guidance released last week, the administration will allow states to further encourage the sale of these plans by letting people use federal subsidies to buy them.
As a nation, it is important for us to focus our energy on ways to improve people’s health. We are experiencing an unprecedented decline in life expectancy which will ultimately affect our economic health and the ability of Americans to compete in a global workforce. One of the most basic things we can do is preserve the coverage protections for people with health problems that have been law for more than four years, rather than poke holes in them. Americans say they support this idea. Recent polls have found that majorities of Americans believe that people with health conditions should not be denied affordable health insurance and health care. As a result, House and Senate candidates of both parties are running on their support for protecting coverage for people with preexisting conditions. But some of those very candidates voted to repeal the ACA last year.
The ACA has dramatically improved the ability of people with preexisting conditions to buy coverage. In 2010, before the law passed, we conducted a survey that found 70 percent of people with health problems said it was very difficult or impossible to buy affordable coverage, and just 36 percent said they ended up purchasing a health plan. By 2016, the percentage of people who had trouble buying an affordable plan had dropped down to 42 percent — still high but much improved — and 60 percent ultimately bought a plan.
While the congressional ACA repeal bills failed last year, a Republican Congress could try again next year. And in the meantime, the law’s preexisting conditions protections and other provisions face another threat from a lawsuit brought by Republican governors and attorneys general in 20 states. The U.S Department of Justice has agreed with the plaintiff states in part, and refused to defend the law’s preexisting condition protections. The court decision is pending. Should the states win, an estimated 17 million people could become uninsured.
Some congressional candidates from these states and others are pointing to their support for Republican proposals, such as the “Ensuring Coverage for Patients with Pre-Existing Conditions Act,” as proof they support coverage for preexisting conditions. This bill would prevent insurers from refusing or varying premiums based on preexisting conditions. But, unlike the ACA, this bill would allow insurers to sell plans that entirely exclude coverage for care pertaining to the preexisting conditions themselves. The reality is that this bill would not protect sick Americans, or those who may become ill in the future, from high out-of-pocket health care costs.
Several million people will be going to the marketplaces in the next few weeks to sign up for coverage since they do not have it through an employer. At this time, not one of them who buys a plan in the marketplace has to fear that an insurance company will deny them coverage or charge them a higher premium because of their health. The efforts to undermine the individual market and invalidate the ACA’s consumer protections are real-life threats for people who depend on this insurance for their health care. The nation cannot move forward with tackling our most pressing health care problems if we continue to debate a core protection of the ACA that most Americans support.
IN SEARCH OF INSURANCE SAVINGS, CONSUMERS CAN GET UNWITTINGLY WEDGED INTO NARROW-NETWORK PLANS
Despite federal rules requiring plans to keep up-to-date directories, consumers may lack access to clear information about which health plans have ‘narrow networks’ of providers or which hospitals and doctors are in or out of an insurer’s network.
As a breast cancer survivor, Donna Catanuchi said she knows she can’t go without health insurance. But her monthly premium of $855 was too high to afford.
“It was my biggest expense and killing me,” said Catanuchi, 58, of Mullica Hill, N.J.
A “navigator” who helps people find coverage through the Affordable Care Act found a solution. But it required Catanuchi, who works part time cleaning offices, to switch to a less comprehensive plan, change doctors, drive farther to her appointments and pay $110 a visit out-of-pocket — or about three times what she was paying for her follow-up cancer care.
She now pays $40 a month for coverage, after she qualified for a substantial government subsidy.
Catanuchi’s switch to a more affordable but restrictive plan reflects a broad trend in insurance plan design over the past few years. The cheaper plans offer far narrower networks of doctors and hospitals and less coverage of out-of-network care. But many consumers are overwhelmed or unaware of the trade-offs they entail, insurance commissioners and policy experts say.
With enrollment for ACA health plans beginning Nov. 1, they worry that consumers too often lack access to clear information about which health plans have “narrow networks” of medical providers or which hospitals and doctors are in or out of an insurer’s network, despite federal rules requiring plans to keep up-to-date directories.
“It’s very frustrating for consumers,” said Betsy Imholz, who represents the advocacy group Consumers Union at the National Association of Insurance Commissioners. “Health plan provider directories are often inaccurate, and doctors are dropping in and out all the time.”
These more restrictive plans expose people to larger out-of-pocket costs, less access to out-of-network specialists and hospitals, and “surprise” medical bills from unforeseen out-of-network care.
More than 14 million people buy health insurance on the individual market — largely through the ACA exchanges, and they will be shopping anew this coming month.
TREND APPEARS TO BE SLOWING
For 2018, 73 percent of plans offered through the exchanges were either health maintenance organizations (HMOs) or exclusive provider organizations (EPOs), up from 54 percent in 2015.
Both have more restrictive networks and offer less out-of-network coverage compared with preferred provider organizations (PPOs), which represented 21 percent of health plans offered through the ACA exchanges in 2018, according to Avalere, a health research firm in Washington, D.C.
PPOs typically provide easier access to out-of-network specialists and facilities, and partial — sometimes even generous — payment for such services.
Measured another way, the number of ACA plans offering any out-of-network coverage declined to 29 percent in 2018 from 58 percent in 2015, according to a recent analysis by the Robert Wood Johnson Foundation.
For example, in California, HMO and EPO enrollment through Covered California, the state’s exchange, grew from 46 percent in 2016 to 70 percent in 2018, officials there said. Over the same period, PPO enrollment declined from 54 percent to 30 percent.
In contrast, PPOs have long been and remain the dominant type of health plan offered by employers nationwide. Forty-nine percent of the 152 million people and their dependents who were covered through work in 2018 were enrolled in a PPO-type plan. Only 16 percent were in HMOs, according to the Kaiser Family Foundation’s annual survey of employment-based health insurance.
The good news for people buying health insurance on their own is that the trend toward narrow networks appears to be slowing.
“When premiums shot up over the past few years, insurers shifted to more restrictive plans with smaller provider networks to try and lower costs and premiums,” said Chris Sloan, a director at Avalere. “With premium increases slowing, at least for now, that could stabilize.”
Some research supports this prediction. Daniel Polsky, a health economist at the University of Pennsylvania, found that the number of ACA plans nationwide with narrow physician networks declined from 25 percent in 2016 to 21 percent in 2017.
Polsky is completing an analysis of 2018 plans and expects the percent of narrow network plans to remain “relatively constant” for this year and into 2019.
“Fewer insurers are exiting the marketplace, and there’s less churn in the plans being offered,” said Polsky. “That’s good news for consumers.”
Insurers may still be contracting with fewer hospitals, however, to constrain costs in that expensive arena of care, according to a report by the consulting firm McKinsey & Co. It found that 53 percent of plans had narrow hospital networks in 2017, up from 48 percent in 2014.
“Narrow networks are a trade-off,” said Paul Ginsburg, a health care economist at the Brookings Institution. “They can be successful when done well. At a time when we need to find ways to control rising health care costs, narrow networks are one legitimate strategy.”
Ginsburg also notes that there’s no evidence to date that the quality of care is any less in narrow versus broader networks, or that people are being denied access to needed care.
Mike Kreidler, Washington state’s insurance commissioner, said ACA insurers in that state “are figuring out they can’t get away with provider networks that are inadequate to meet people’s needs.”
“People have voted with their feet, moving to more affordable choices like HMOs but they won’t tolerate draconian restrictions,” Kreidler said.
The state is stepping in, too. In December 2017, Kreidler fined one insurer — Coordinated Care — $1.5 million for failing to maintain an adequate network of doctors. The state suspended $1 million of the fine if the insurer had no further violations. In March 2018, the plan was docked another $100,000 for similar gaps, especially a paucity of specialists in immunology, dermatology and rheumatology. The $900,000 in potential fines continues to hang over the company’s head.
Centene Corp, which owns Coordinated Care, has pledged to improve its network.
Pennsylvania Insurance Commissioner Jessica Altman said she expects residents buying insurance in the individual marketplace for 2019 to have a wider choice of providers in their networks.
“We think and hope insurers are gradually building more stable networks of providers,” said Altman.
NEW STATE LAWS
Bad publicity and recent state laws are pushing insurers to modify their practices and shore up their networks.
About 20 states now have laws restricting surprise bills or balance billing, or which mandate mediation over disputed medical bills, especially those stemming from emergency care.
Even more have rules on maintaining accurate, up-to-date provider directories.
The problem is the laws vary widely in the degree to which they “truly protect consumers,” said Claire McAndrew, a health policy analyst at Families USA, a consumer advocacy group in Washington, D.C. “It’s a patchwork system with some strong consumer protections and a lot of weaker ones.”
“Some states don’t have the resources to enforce rules in this area,” said Justin Giovannelli, a researcher at the Center on Health Insurance Reforms at Georgetown University. “That takes us backward in assuring consumers get coverage that meets their needs.”
PATIENT LEAKAGE CAN SINK YOUR REVENUES BY 20% OR MORE
https://www.healthleadersmedia.com/finance/patient-leakage-can-sink-your-revenues-20-or-more
A majority of hospital executives recognize patient leakage as a problem that’s costing their respective systems, but few have taken steps to properly address it.
KEY TAKEAWAYS
Reducing patient leakage should be a top priority for CFOs in 2019, according to Scott Vold, CEO of Fibroblast.
The survey found most executives recognize the challenge of patient leakage but few have done anything to stem its effects.
Nearly one in five executives report losing more than 20% on patient leakage annually.
More than four out of five healthcare executives report that patient leakage is a serious problem facing their organizations, though not many have implemented solutions to curb the dilemma, according to a new survey from Fibroblast, commissioned by Sage Growth Partners.
Patient leakage occurs when a patient referral that should stay inside a health network ends up leaving for another or a patient that should receive care in the network but doesn’t follow through on the care.
Among the numerous financial challenges that healthcare executives face, patient leakage is a quandary with a clinical angle that requires immediate action to stem the tide and recoup lost revenues.
WHO’S AWARE OF PATIENT LEAKAGE:
- 87% of executives say it’s a high priority
- 23% don’t track it
- 20% don’t know where or why it happens
Just over one-third of polled executives reported that they understand where and why patient leakage occurs, with 60% saying they don’t follow up with patients to determine if they received care from the physician they were referred to.
WHAT PATIENT LEAKAGE COSTS ANNUALLY:
- 43% of executives say they’ve lost 10% or more of revenues
- 23% say they don’t know how much they’re losing
- 19% say they’ve lost 20% or more
Scott Vold, CEO of Fibroblast, the company which commissioned the Sage Growth Partners survey, told HealthLeaders that patient leakage goes beyond the traditional financial challenges CFOs face because it poses a risk to the value-based care model due to patients developing an event that is more acute than it should’ve been had they received care.
“If it’s not already, reducing patient leakage, including the referral management process, should be their top priority for 2019,” Vold said. “They need to take thoughtful yet aggressive steps to do it. The good news is that it is an addressable problem that can be fixed and can have an enormous financial and strategic impact in a relatively short amount of time.”
WHAT’S AT FAULT AND WHO WILL FIX IT:
- 57% of executives are somewhat satisfied with their EMRs
- 19% say they are not satisfied
- 69% say patient leakage is handled by more than one person
- 19% say they plan to purchase a third-party solution
- Only 2% currently have one in place
HHS set to implement long-delayed 340B final rule in January
Editor’s note: This story has been updated to include a response from 340B Health and the American Hospital Association.
HHS is planning an about-face on the long-delayed rule that would set price ceilings and monetary penalties in the 340B program, moving up its start date by several months.
The Department of Health and Human Services issued a notice (PDF) saying that it intended to finally implement the rule on Jan. 1, cutting off seven months of time from a previously announced July 1 start date.
The rule—which would set price ceilings for drugs and punish pharmaceutical companies that knowingly overcharge 340B hospitals—has been delayed five times by the Trump administration, most recently in June. The final rule was first issued in January 2017.
The Health Resources and Services Administration (HRSA) said the delays were necessary as it needed more time to implement the rule properly and wanted to fully explore possible alternatives or supplemental regulations.
The most recent delay was fueled in part because HHS has made addressing the rising cost of drugs a key priority, and officials were concerned that implementing the rule could impact actions taken under the “American Patients First” plan.
The start date was moved up to Jan. 1, HRSA said in the notice, because it “determined that the finalization of the 340B ceiling price and civil monetary penalty rule will not interfere with the department’s development of these comprehensive policies.”
Four national healthcare organizations sued HHS in September over the delays to the final rule. The American Hospital Association (AHA), America’s Essential Hospitals (AEH), the Association of American Medical Colleges (AAMC) and 340B Health all signed on to the suit, which claims that the repeated delays violate the Administrative Procedure Act.
Since the rule was first proposed in 2015, there has been ample time to notify stakeholders and tweak the plan, the groups argued.
“The department’s proffered rationales for their successive delays have shifted and been inconsistent,” according to the lawsuit.
340B Health said in a statement emailed to FierceHealthcare that the group is “encouraged” to see HHS responding to the suit.
“These rules were ordered by Congress more than eight years ago based on clear, documented evidence of overcharging by drug companies of 340B hospitals, clinics, and health centers,” interim CEO Maureen Testoni said. “The time for delay is over and now it is time for action.”
AHA echoed the sentiment, saying it hopes HHS “sticks by the commitment” to roll out the rule.
“The rule also requires that HHS make pricing information available online to 340B hospitals and other providers,” General Counsel Melinda Hatton said in a statement. “We strongly encourage HHS to publish that website promptly, which is critical to enforcement of the 340B program, as soon as possible after January 1.”
HHS has also taken aim at the 340B program by significantly slashing its payment rate. In a rule that took effect at the beginning of fiscal year 2018, the Centers for Medicare & Medicaid Services cut the rate from up to 6% above the average sales price for a drug to 22.5% less than the average sales price.
All told, the change will cut $1.6 billion in drug discount payments. AHA, AEH and AAMC are also challenging that policy in court.
Anthem’s Q3 profit jumps 29% to $960M
Anthem posted strong operating results in the third quarter of 2018.
Here are four things to know from the health insurer’s results:
1. Anthem’s operating revenue grew 4 percent in the third quarter of this year to $23 billion, up from $22.1 billion in the same period a year prior. The health insurer said premium increases and the return of the health insurance tax in 2018 positively affected operating revenue, as did growth in its Medicare business.
2. Anthem’s reduced footprint in the individual ACA exchanges, local group and Medicaid plans contributed to a year-over-year decline in membership in the third quarter of this year compared to the same three months in 2017. Anthem lost 753,000 members year over year and now has 39.5 million members. At the same time, Anthem grew its Medicare membership year over year by 267,000 members in the third quarter of this year through acquisitions and organic growth.
3. Anthem trimmed its medical loss ratio, or the amount the health insurer pays toward medical care versus overhead costs, to 84.8 percent in the third quarter of this year. That’s down from 87 percent in the same period last year. Lower taxes and better medical cost performance in its commercial and specialty insurance lines contributed to the improvement.
4. Including expenses and nonoperating gains, Anthem ended the third quarter of 2018 with $960 million in net income, up 29 percent from $747 million recorded in the same period last year.
Hospital bankruptcies continue to skyrocket: 3 things to know
More than 20 hospitals have filed for Chapter 11 bankruptcy since 2016, according to an Oct. 30 report from the law firm Polsinelli.
The Polsinelli-TrBK Distress Indices Report details how healthcare trends have affected the U.S. economy. Researchers determined that while the economy, specifically Chapter 11 bankruptcies across all industries and the real estate industry, have remained stable during the past several quarters, healthcare exhibited consistently high levels of distress during eight of the last 11 quarters.
To compile the report, researchers use Chapter 11 bankruptcy data as a proxy for measuring financial distress in the overall U.S. economy and breakdowns of distress specifically in real estate and healthcare.
Here are three things to know from the report:
1. Southwestern states have been hit the hardest by healthcare bankruptcy filings. For example, increased competition, insurance payer pressure and overexpansion contributed to Neighbors Legacy Holdings in Houston, a freestanding emergency facility operator with more than 30 facilities, to file for bankruptcy earlier this year.
2. While general Chapter 11 bankruptcies have decreased 53 percent from the 2010 benchmark, healthcare industry distress increased by 305 percent during the same period.
3. The law firm’s Health Care Services Distress Research Index was 405 for the third quarter of 2018, an increase of 65 points from the second quarter of 2018. The third-quarter figures represent a year-over-year increase of 82 points.
To learn more, click here.
Optum360, WayStar Named Top Revenue Cycle Management Vendors
Health systems preferred Optum360 for end-to-end healthcare revenue cycle management software and outsourcing, while physician practices favored Waystar.
– The eighth annual revenue cycle management technology and outsourcing solutions survey from Black Book recently uncovered the top client-rated healthcare revenue cycle management vendors for health systems, hospitals, and physician practices.
The market research company polled nearly 4,500 hospital and health system CFOs, VPs of Finance and Revenue Cycle Management (RCM), Controllers, Business Officer Managers, and other financial staff. Another 3,660 physician office business managers and 941 staff from outpatient, alternative care, clinics, IDN physician practices, and ancillary facilities also participated in the 2018 ratings.
The survey showed that providers are investing in healthcare revenue cycle management solutions as health system margins shrink to less than three percent nationwide and providers in all settings transition away from fee-for-service.
“The latest wave of challenges accompanying the shift to value-based care find most providers navigating through empowering virtual health, initiating highly patient positive experiences and sinking margins,” stated Black Book’s Managing Partner Doug Brown. “Revenue cycle management is now the most pressing strategic focus in health systems nationwide with system transformation vendors, solutions optimization consultants and RCM outsourcing firms in huge demand.”
Based on 18 indicators of client experience, loyalty, and customer satisfaction, the survey revealed the top-rated RCM solutions for various parts across the entire healthcare revenue cycle.
In terms of end-to-end revenue cycle management software, health systems and large hospital chains preferred Optum360, followed by Waystar, Change Healthcare, Recondo, and Conifer.
Health systems named Optum360 as their top end-to-end revenue cycle management software solution for the second year in a row.
Waystar and Optum360 also took top spots for hospitals with 101 to 200 beds, while small hospitals favored the RCM software from Trubridge and large hospitals ranked Change Healthcare as number one.
Physician practices and groups rated Waystar as their top RCM software vendor, followed by Change Healthcare, Allscripts, Cerner RevWorks, and athenaCollect.
Optum360 was also the highest ranked revenue cycle management outsourcing solution for health systems and large hospital chains shifting their financial and business functions outside of their organizations.
However, top revenue cycle outsourcing solutions was a mixed bag for standalone hospitals and physician practices.
Small hospitals identified Trubridge as their top outsourcing solution, while medium-sized hospitals preferred Gebbs and large hospitals liked Cognizant Trizetto.
R1 RCM was the highest rated end-to-end RCM outsourcing solution among physician practices and groups.
Additionally, the survey found the highest ranked vendors for other parts of the healthcare revenue cycle, including patient payments, provider contract management, and claims and denials management. Notable rankings included:
- Patient payment solutions: InstaMed
- Complex claims solutions: Cognizant Bolder
- Patient access solutions: Recondo Technology
- Hospital claims and denials management: Experian Health
- Physician claims clearinghouse: Cognizant Trizetto
- Patient payment analytics: RevSpring
- Provider contract management systems: nThrive
- Revenue recovery solutions: Revint Solutions
- RCM optimization consultants: Hayes Management Consulting
- RCM business intelligence and decision support: Dimension Insight
Provider organizations of all sizes are seeking healthcare revenue cycle management solutions to optimize all parts of their financial and business processes.
Revenue cycle management optimization was a top priority for hospitals, according to a September 2017 Black Book survey. Almost three-quarters of struggling hospitals prioritized revenue cycle management over other initiatives key to the value-based reimbursement transition, including population health, data analytics, and patient engagement.
The hospital and physician practice leaders surveyed said they planned to allocate 2018 capital resources for revenue cycle management upgrades, including dashboards, data analytics, and business intelligence solutions.
Revenue cycle management optimization investments are likely to continue well into the near future as provider organizations face more competition, greater patient financial responsibility, and a shifting healthcare environment.
“Healthcare providers will have no choice but to evaluate and optimize their solutions end-to-end in a future state that leverages analytics and enhanced connectivity with payers, all keeping pace with the advances in healthcare technology,” Black Book’s Brown stated in 2017.
Exclusive poll: What voters want from “Medicare for All”
Voters like some form of “Medicare for All” but are divided over what it should look like, according to our latest Axios/SurveyMonkey poll — which is about the same situation Democratic candidates are in.
The big picture: Many of Democrats’ leading 2020 prospects, and a host of candidates in the midterms, have embraced “Medicare for All,” but there’s a big variation in the policies they propose under that banner.
HENRY KOTULA 