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The beginnings of a wave of physician secession?
https://mailchi.mp/5a57c9e710d7/the-weekly-gist-april-5-2019?e=d1e747d2d8
This week I got a message from a physician who is a member of a health system’s employed medical group. He’d come across my quote in a story that aired on Charlotte, NC’s NPR affiliate WFAE discussing the recent exits of large groups of doctors from two health system-sponsored medical groups in that market. When we connected over the phone, he said, “Splitting off from the health system is something that doctors joke about over beers. Is this for real, and how were they able to do it? Where else is this happening?”
From our perspective, the situation in Charlotte is unique—we haven’t seen another market where dozens of doctors have “seceded” from an employed group en masse to return to independent practice. But we wouldn’t be surprised to see others. A general sense of practice fatigue has made some doctors antsy, and more open to exploring other options. And it’s hard for employed doctors to ignore the big dollars being commanded by large, independent physician practices from payers and investors.
Given the depth of integration and shared infrastructure, exiting an employment arrangement today is far more complex compared to twenty years ago, when it was almost as easy as changing the sign on the practice door. But doctors in many markets are watching the fate of their newly-independent peers in Charlotte. Health systems whose medical groups lack an integrated identity, shared values and common culture may be the most susceptible to a possible wave of physician secession.
More good news for Medicare Advantage plans
https://mailchi.mp/5a57c9e710d7/the-weekly-gist-april-5-2019?e=d1e747d2d8
Medicare Advantage (MA) plans got a better-than-anticipated pay hike this week, as the Centers for Medicare & Medicaid Services (CMS) released its final 2020 policy and payment updates for the private coverage program for seniors. MA payments will increase by an average of 2.53 percent in 2020, higher than the 1.59 percent initially proposed by CMS earlier this year, reflecting CMS’s expectation that MA services will grow faster than it initially thought.
With the announcement, CMS is also finalizing plans to allow reimbursement for supplemental, non-clinical services covered by MA plans, such as transportation, nutrition support, and housing improvements, as long as those services are intended to improve health status. The final update also confirms CMS’s intent to continue updating its risk-adjustment methodology to more accurately reflect the intensity of services delivered to beneficiaries, a change that has been controversial among insurers, who fear the new methodology will result in lower payments from the government.
Despite these concerns, shares of MA insurers traded higher after the CMS announcement, and health plans will no doubt be pleased with yet another year of good news from CMS on MA rates. Given continued strong enrollment growth, robust rate increases, and a pipeline of millions of aging Baby Boomers poised to become eligible for Medicare, large insurers (and increasingly, providers) will view MA as their primary source of growth for the next decade or more.
Walking back plans for an ACA replacement plan
https://mailchi.mp/5a57c9e710d7/the-weekly-gist-april-5-2019?e=d1e747d2d8
Reversing course in the face of strong pushback from his own party’s leaders in Congress, President Trump this week backed off his earlier pledge to deliver a Republican healthcare plan to replace the Affordable Care Act (ACA).
After the Department of Justice switched positions on the Texas court case testing the constitutionality of the ACA, urging the Fifth Circuit Court of Appeals to invalidate the 2010 law entirely, Trump doubled down by declaring that Republicans would be known as the “party of healthcare”, going so far as to tap four GOP senators to craft a replacement bill.
However, the White House received a rare rebuke from Senate Majority Leader Mitch McConnell (R-KY), who said this week that in private discussions with the President, “I made it clear to him that we’re not going to be doing that in the Senate.” In tweets and a subsequent speech, Trump signaled his frustration with Congressional Republicans on the issue (“We blew it the last time. Man, I was fed a bill of goods.”), vowing to return to the issue after the 2020 elections.
By highlighting GOP divisions on the issue, this week’s public dust-up and Presidential about-face all but guarantee that healthcare will be a marquee issue in the upcoming elections, allowing Democrats to campaign on an issue that proved a strong suit for them in the 2018 midterms. Expect the politics of healthcare to remain front and center in the months to come.
Insurers, hospitals, physicians united in stance on ACA lawsuit
Hospitals, physicians and insurer groups are united in wanting to preserve the Affordable Care Act and have defended it in briefs filed with the Fifth Circuit Court of Appeals.
The American Hospital Association, the American Medical Association and America’s Health Insurance Plans are among groups that are fighting a lower court ruling in Texas that struck down the law.
On the other side is the Department of Justice, which last month reversed an earlier opinion and sided with the Texas judge who ruled that without the individual mandate, the entire ACA has no constitutional standing.
WHY THIS MATTERS
The ACA has insured millions who otherwise may not have been insured, allowing them to get care when needed instead of going to the more expensive emergency room when they have a medical crisis.
Hospitals and physicians see less uncompensated care under the ACA.
Without the ACA, patients would no longer have protections for pre-existing conditions, children would no longer have coverage under their parents’ health insurance plan until age 26, insurers would no longer be held to the 85 percent medical loss ratio, 100 percent coverage for certain preventive services would cease and individual marketplace and subsidies based on income would be eliminated.
Also, federal funding for Medicaid expansion would end.
TREND
Republicans under President Trump have tried unsuccessfully to repeal and replace the law.
The lawsuit, brought by 19 Republican governors, puts the GOP in a political bind over supporting the repeal of a law that is popular with consumers and their constituents. President Donald Trump recently said Republicans would unveil an ACA replacement after the 2020 election.
Democrats are also facing a crisis within their party over healthcare as it becomes a priority issue in the presidential election. Some of the leading candidates, such as Senator Kamala Harris, support Medicare for all. The Medicare for All Act of 2019 has been introduced in the Democratic-led House of Representatives.
Veteran politician and attorney Earl Pomeroy said he believes the Texas versus United States appeal changes the political course for 2020. The entire MFA argument will move to the back burner because of the Texas lawsuit, he said.
“The fight is going to be trying to underscore the Congressional importance of the provisions of the ACA and enhancing them,” Pomeroy said. “I do not believe that supporting Medicare for all is an advantageous position for a Democratic candidate running in a district that is not a secure Democratic seat. I believe Kamala Harris will spend much of the campaign walking back her comments on health insurance.”
Pomeroy is a former member of the U.S. House of Representatives for North Dakota’s at-large district, a North Dakota Insurance Commissioner and senior counsel in the health policy group with Alston & Bird.
“The safe political ground is defending a law people have warmed up to,” he said. “All politics is local but all healthcare is personal. There is little risk tolerance in the middle class for bold experiments in healthcare.”
BACKGROUND
The lawsuit was brought by Texas and the 19 other Republican-led states, based on the end of the individual mandate. In February, U.S. District Court Judge Reed O’Connor agreed that the federal law cannot stand without the individual mandate because if there is no penalty for not signing up for coverage, then the rest of the law is unconstitutional.
Twenty-one Democratic attorneys general appealed and the House of Representatives has intervened to defend the ACA in the case.
Either outcome in the appeals court may see the case headed to the U.S. Supreme Court.
WHAT THE PROVIDERS AND INSURERS ARE TELLING THE COURT
In a court brief filed by the AHA, the Federation of American Hospitals, The Catholic Health Association of the United States, America’s Essential Hospitals, and the Association of American Medical Colleges urged the Fifth Circuit Court of Appeals to reject a district court decision they said would have a harmful impact on the American healthcare system.
“Those without insurance coverage forgo basic medical care, making their condition more difficult to treat when they do seek care. This not only hurts patients; it has severe consequences for the hospitals that provide them care. Hospitals will bear a greater uncompensated-care burden, which will force them to reallocate limited resources and compromise their ability to provide needed services,” they said.
In a separate friend-of-the-court brief, 24 state hospital associations also urged the Fifth Circuit to reverse, highlighting specific innovative programs and initiatives for more coordinated care.
The American Medical Association, the American College of Physicians, American Academy of Family Physicians, American Academy of Pediatrics and the American Psychiatric Association filed a brief. AMA President Dr. Barbara L. McAneny said, “The district court ruling that the individual mandate is unconstitutional and inseverable from the remainder of the ACA would wreak havoc on the entire healthcare system, destabilize health insurance coverage, and roll back federal health policy to 2009. The ACA has dramatically boosted insurance coverage, and key provisions of the law enjoy widespread public support.”
AHIP said the law impacts not only the individual and group markets, but also other programs such as Medicaid, Medicare and Part D coverage.
“Since its passage in 2010, the ACA has transformed the nation’s healthcare system,” AHIP said. “It has restructured the individual and group markets for purchasing private health care coverage, expanded Medicaid, and reformed Medicare. Health insurance providers (like AHIP’s members) have invested immense resources into adjusting their business models, developing new lines of business, and building products to implement and comply with those reforms.”
Sutter Health|Aetna adds Stanford Health Care to network
The joint venture between provider and payer, which launched last year, has grown to about 50 plan sponsors across 15 counties.
Sutter Health|Aetna has added Stanford Health Care to its network of providers.
Sutter Health|Aetna is the joint venture launched last year between the Sacramento, California-based health system and the national insurer. It offers self-insured preferred provider organization health plans to businesses in the Northern California area.
It has grown to about 50 plan sponsors across 15 counties.
WHY THIS MATTERS
This represents another expanded partnership between a provider and payer, though this is in the commercial space.
Other recent partnerships, such as the one announced between Duke Health and Blue Cross Blue Shield of North Carolina, have capitalized on the Medicare Advantage market.
Stanford Health Care recently launched a Medicare Advantage plan with Lumeris called the Stanford Health Care Advantage, in northern California.
The partnerships allow providers and insurers to expand their reach and get access to population health data to lower costs and improve outcomes.
The addition of Stanford Health Care gives Sutter Health|Aetna’s network members in Northern California access to the network’s more than 1,500 specialists and nearly 200 primary care physicians throughout the San Francisco Bay Area.
THE TREND
With the addition of Stanford Health Care, the Sutter Health|Aetna joint venture features two nationally recognized healthcare systems and access to a Northern California network that includes 33 hospitals, more than 1,700 primary care physicians, more than 9,400 specialists, 74 urgent care locations and 25 walk-in clinics.
ON THE RECORD
“The inclusion of Stanford Health Care, with its physicians from across Stanford Medicine, to our high-quality network will not only expand the provider network for our plan sponsors and members, but also provide access to another highly ranked health care system,” said Steve Wigginton, CEO of Sutter Health|Aetna. “This addition will help us in our goal to create a unique offering for Northern California employers and their employees centered around a superior consumer experience and market-leading value.”
Ex-hospital exec sues DMC for wrongful discharge, retaliation
The former top Detroit Medical Center cardiologist is suing the health system, arguing he was forced out of his job for complaining about alleged fraud at the health system, including unnecessary surgeries billed to Medicare and Medicaid.
The wrongful discharge and retaliation lawsuit was filed in Detroit U.S. District Court by Dr. Ted Schreiber, who was recruited by the DMC in 2004 and developed a trademarked process to speed life-saving treatment for heart attack patients. He also was the founding president of the new DMC Heart Hospital that opened with fanfare in 2014.
Schreiber’s accusations are “unsubstantiated,” a DMC spokeswoman said Monday night, and the health system continues to have a “culture of integrity.”
Heart Hospital shares facilities with Harper University Hospital that is poised to be terminated from the federal Medicare program in less than two weeks after failing inspections in October and December. Since Harper and Heart Hospital are considered a single facility by the Centers for Medicare Medicaid Services, both would be barred from the federal health insurance program for the elderly and disabled if Harper fails to pass an unannounced inspection by the April 15 deadline.
Michigan prohibits hospitals barred from receiving Medicare funding from participating in Medicaid, the health insurance program for mostly low-income people that is jointly funded by the state and federal governments. The two programs combined pay for 85 percent of Harper’s inpatient hospital stays, according to Allan Baumgarten, a Minneapolis-based hospital analyst.
The inspections in October and December were prompted by complaints from Schreiber and three other health system cardiologists who said they were forced from their leadership roles in retaliation for complaining about quality of care issues at the DMC.
Cardiologists Dr. Mahir Elder and Dr. Amir Kaki filed a similar lawsuit last week in Detroit federal court, saying they were forced from leadership posts for complaining to leaders of the DMC about unnecessary surgeries, dirty surgical instruments and other problems.
In his lawsuit, Schreiber said he brought concerns about physician competency and unnecessary and/or dangerous procedures to DMC peer review meetings in a bid to ensure that they were investigated. But his concerns were ignored by DMC and its for-profit owner, Tenet Healthcare of Dallas, according to Schreiber’s lawsuit.
“(T)he profitability of physicians was being weighed more heavily by DMC and Tenet executives than the physicians’ ability to provide services to patients within the standard of care,” Schreiber alledged in his lawsuit. “This policy resulted in an increase in unnecessary and/or risky procedures conducted by some physicians leading to bad patient outcomes and even patient deaths.”
The DMC continues to argue that Schreiber and the other cardiologists violated the company’s conduct code. The health system’s top priority is delivering “safe, high quality care to the people of Detroit,” said spokeswoman Tonita Cheatham.
“We have a culture of integrity, which means we don’t look the other way, we don’t condone inappropriate behavior of any kind, and we don’t compromise on our priorities,” Cheatham said in a statement.
“That also means we expect physicians to uphold our Standards of Conduct, including treating fellow physicians, nurses and staff members with respect and dignity. We welcome the opportunity to present the facts underlying the claims made in the complaint.”
In the lawsuit, Schreiber indicated he also complained to Tenet and DMC leaders that some cardiologists were away from the hospital during times they were required to be on-site as members of Cardio Team One’s 24-hour on-call team. He also said he raised concerns about staffing cuts that resulted in poor nursing care for cardiac patients.
Tenet Healthcare signed a three-year “corporate integrity agreement” as part of a $513 million settlement with the U.S. Department of Justice over allegations of a kick-back scheme involving involving four Tenet hospital subsidiaries in the South, according to Schreiber’s suit. The agreement required Tenet and all of its hospitals to self-report all complaints to the federal Justice Department.
“Senior management, including these Defendants, failed to do so and blatantly allowed legal violations to occur in order to generate more income by cutting medically necessary support and allowing unnecessary medical procedures, among other things,” the former cardiologist executive said in his lawsuit.
Schreiber referred a request for comment on the lawsuit to his attorney, David Ottenwess of Detroit.
“Tenet Healthcare, the current for-profit owner of the DMC, has been continually cited by the federal government for placing profits over people,” Ottenwess said. “Tenet has continued that course with its retaliation against Dr. Schreiber and others at the Heart Hospital who had the courage to question Tenet’s practices of profits over safety.”
HENRY KOTULA 