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4,000 Kaiser mental health clinic workers launch 5-day strike in California
Four thousand California mental health clinicians began a five-day strike Dec. 10 to protest what they call understaffing issues that lead to long wait times for therapy appointments.
The strike affects more than 100 Kaiser Permanente clinics and medical facilities, according to the National Union of Healthcare Workers, which represents psychologists, therapists, social workers, addiction medicine specialists and other mental health clinicians.
Workers are striking at Los Angeles Medical Center, Anaheim Medical Center, Fontana Medical Center, San Diego Medical Center, Fresno Medical Center, Sacramento Medical Center, San Francisco Medical Center and San Jose Medical Center.
“The situation inside Kaiser clinics has become untenable,” said Kenneth Rogers, a psychologist for Oakland, Calif.-based Kaiser. “We don’t have enough hours in the day to see patients and do all the preparation and follow-up work that goes into every appointment. Patients are suffering and unable to access clinically appropriate care.”
Union president Sal Rosselli told The Mercury News mental health workers also seek benefits and pensions that are equal to what about 100,000 other Kaiser employees receive.
John Nelson, vice president of communications at Kaiser Permanente, expressed disappointment about the strike.
“We are disappointed the leadership of the National Union of Healthcare Workers would ask our highly valued mental health staff to go out on strike, when we’ve been in active negotiations since the summer, having met in 16 bargaining sessions over five months, and with two more bargaining sessions scheduled for next week,” he told Becker’s last month.
“There are no takeaways in our contract proposal,” Mr. Nelson said. “We are offering guaranteed wage increases which would keep our expert therapists among the best compensated in their profession and continue to ensure that we attract and retain the most highly skilled professionals.”
Kaiser told The Mercury News its medical centers and medical offices are scheduled to remain open during the walkout, although “some nonurgent mental health and other appointments may need to be rescheduled.”
Middle-income Americans paying more for health insurance
https://www.healthcaredive.com/news/middle-income-americans-paying-more-for-health-insurance/543903/
Dive Brief:
- Middle-income families are spending more of their incomes on health insurance as average premiums skyrocketed in 2017 after modest rate increases earlier this decade, The Commonwealth Fund found in a new report.
- Average employee contributions rose to nearly 7% of median income for single and family plans compared to 5.1% a decade ago. Premium contributions were 8% of median income or more in 11 states, including Louisiana, which had the highest percentage (10.2%).
- The contributions and potential out-of-pocket spending for single and family policies was $7,240 in 2017. That was 11.7% of median income and an increase from 7.8% a decade ago.
Dive Insight:
Cost and price variations between areas aren’t anything new. A recent Network for Regional Healthcare Improvement found healthcare usage and pricing drive variation between states’ total healthcare costs. The report also found vast differences in costs between five states studied.
Overall, national health spending has slowed in recent years. The CMS Office of the Actuary reported this month that national health spending grew 3.9% ($10,739 per person) in 2017. It was the second consecutive year of slower healthcare spending growth. The slower cost growth is connected to fewer people receiving care.
The Commonwealth Fund found large differences between states. For instance, the average annual premium contributions for single-person plans ranged from $675 in Hawaii to $1,747 in Massachusetts. Michigan saw the cheapest premiums in family plans at $3,646 while Delaware had the highest at $6,533.
The average annual deductible for single-person policies increased to more than $1,800 in 2017. The gap was between $863 (Hawaii) and about $2,300 (Maine and New Hampshire). Three states (Florida, Mississippi and Tennessee) had average deductibles more than 6% of median income.
Premiums for employer health plans, which is how most Americans get coverage, increased 4.4% for single plans and 5.5% for family plans in 2017. All but five states saw higher single-person premiums with eight states averaging more than $7,000 (Alaska, Connecticut, Delaware, Massachusetts, New Jersey, New York, Rhode Island and Wyoming).
Meanwhile, family premiums increased in 44 states and were $20,000 or more in seven states (Alaska, Connecticut, Massachusetts, New Jersey, New York, West Virginia and Wyoming) and the District of Columbia.
The cost of health insurance is increasing faster than wage growth — and the Commonwealth Fund found that the added cost isn’t leading to higher-quality health insurance. The issue is especially a problem in southern states with lower median incomes, such as Mississippi.
The group suggested policymakers could tackle the problem of rising healthcare costs in a couple of ways.
Congress could provide more tax credits to people with employer-sponsored insurance, require businesses to improve plan benefit design to cover more services before employees reach their deductibles and offer refundable tax credits to offset out-of-pocket costs.
Other potential efforts include connecting provider payments to value and outcomes, addressing the concentration of payer and provider markets and slowing prescription drug cost growth. “Policymakers will need to recognize that the increasing economic strain of healthcare costs facing middle-income and poor Americans is driven by multiple interrelated factors and will require a comprehensive solution,” according to the report.
The Cost of Employer Insurance Is a Growing Burden for Middle-Income Families
Recent national surveys show health care costs are a top concern in U.S. households.1 While the Affordable Care Act’s marketplaces receive a lot of media and political attention, the truth is that far more Americans get their coverage through employers. In 2017, more than half (56%) of people under age 65 — about 152 million people — had insurance through an employer, either their own or a family member’s.2 In contrast, only 9 percent had a plan purchased on the individual market, including the marketplaces.
In this brief, we use the latest data from the federal Medical Expenditure Panel Survey–Insurance Component (MEPS–IC) to examine trends in employer premiums at the state level to see how much workers and their families are paying for their employer coverage in terms of premium contributions and deductibles. We examine the size of these costs relative to income for those at the midrange of income distribution. The MEPS–IC is the most comprehensive national survey of U.S. employer health plans. It surveyed more than 40,000 business establishments in 2017, with an overall response rate of 65.8 percent.
Highlights
- After climbing modestly between 2011 and 2016, average premiums for employer health plans rose sharply in 2017. Annual single-person premiums climbed above $7,000 in eight states; family premiums were $20,000 or higher in seven states and D.C.
- Rising overall employer premiums increased the amount that workers and their families contribute. Average annual premium contributions for single-person plans ranged from $675 in Hawaii to $1,747 in Massachusetts; family plans ranged from $3,646 in Michigan to $6,533 in Delaware.
- Average employee premium contributions across single and family plans amounted to 6.9 percent of U.S. median income in 2017, up from 5.1 percent in 2008. In 11 states, premium contributions were 8 percent of median income or more, with a high of 10.2 percent in Louisiana.
- The average annual deductible for single-person policies rose to $1,808 in 2017, ranging from a low of $863 in Hawaii to a high of about $2,300 in Maine and New Hampshire. Average deductibles across single and family plans amounted to 4.8 percent of median income in 2017, up from 2.7 percent in 2008. In three states (Florida, Mississippi, and Tennessee), average deductibles comprised more than 6 percent of median income.
- Combined, average employee premium contributions and potential out-of-pocket spending to meet deductibles across single and family policies rose to $7,240 in 2017 and was $8,000 or more in eight states. Nationally, this potential spending amounted to 11.7 percent of median income in 2017, up from 7.8 percent a decade earlier. In Louisiana and Mississippi, these combined costs rose to 15 percent or more of median income.
Risk-Adjustment Fix Finalized for 2018 After Bout of Uncertainty
https://www.healthleadersmedia.com/finance/risk-adjustment-fix-finalized-2018-after-bout-uncertainty
Officials have made no secret of their disdain for the ACA, so some accused them of making an excuse to destabilize the market. Not so, says the CMS administrator.
KEY TAKEAWAYS
The fix follows a brief freeze last summer, when the Trump administration said it was just following a judge’s order.
The payments are a permanent fixture of the ACA designed to compensate insurers who cover sicker groups.
Five months after the Centers for Medicare & Medicaid Services sent a wave of uncertainty across the health insurance industry by freezing risk-adjustment payments, the agency has finalized a fix for the 2018 benefit year.
The move seeks to appease a federal judge in New Mexico who ruled last February that the government had failed to justify its methodology for calculating the payments for benefit years 2014-2018. That ruling was the basis, CMS said, for the administration’s decision to freeze payments suddenly last July.
The freeze lasted only two-and-a-half weeks until CMS announced a final rule to resume the payments for the 2017 benefit year. That final rule re-adopted the existing methodology, with an added explanation regarding the program’s budget neutrality and use of statewide average premiums. A similar fix for the 2018 benefit year was proposed two weeks later.
Risk-adjustment payment policies for the 2019 benefit year, which weren’t subject to the judge’s ruling, were finalized in April.
The risk-adjustment payments are a permanent feature of the Affordable Care Act designed to offset the law’s requirement that insurers offer coverage without regard to a consumer’s health status. Since some insurers will inevitably attract sicker patient populations than others, the ACA redirects money from insurers with healthier populations to those with higher utilization.
Trump administration officials have made no secret of their disdain for the ACA, so some accused them of using the February ruling as an excuse to inject uncertainty into the market, one exhibit in the menagerie of alleged “sabotage.” Even the nonprofit health plan that filed the lawsuit that prompted the freeze accused the government of making “a purely self-inflicted wound” when it could have instead promulgated a new rule all along.
Conservative critics, meanwhile, accused the administration of capitulating to political and industry pressure by ending the freeze, when it should have instead “ended its micromanagement of the insurance market.”
CMS Administrator Seema Verma said in a statement Friday that the final rule “continues our commitment to provide certainty regarding this important program, to give insurers the confidence they need to continue participating in the markets, and, ultimately, to guarantee that consumers have access to better coverage options.”
Kris Haltmeyer, vice president of legislative and regulatory policy for the Blue Cross Blue Shield Association, lauded the fix.
“We are pleased to see CMS issue this final rule to keep the risk adjustment program in place for the 2018 benefit year, ensuring stability in health care coverage for millions of Americans,” Haltmeyer said in a statement. “This important program has worked for years to balance the cost of care between healthy Americans and those with significant medical needs and, as CMS has stated, is working as intended.”
“The program’s continued smooth operation is vital to ensure access to a broad range of coverage options for millions of individuals and small businesses,” he added.
Verma noted that the litigation is still pending.
Hospital mergers and acquisitions: They keep happening but let’s face it, the big ones rarely work
The first installment of our two-part series looks at many of the things that can, and commonly do, go wrong.
Mergers and acquisitions have been a common occurrence in healthcare for years now, and of late, mega-mergers have become the norm — giant organizations that join forces, often in an attempt to leverage their newfound scale and keep dollars flowing in.
The problem is that these mega-mergers often don’t deliver on their promises. Organizations want more negotiating power when hashing out contracts with insurance companies, and they rarely get it. Credit ratings are being downgraded. Costs often rise, quality deteriorates, and some companies want out of these deals altogether six or seven years down the road.
Others work out just fine, of course, but for every healthcare entity that sees success in these deals, there’s another which just bet the farm and lost it.
The mission then becomes: How to avoid that fate?
HARD LOOK AT REALITY
RIta Numerof, PhD, president of healthcare consulting firm Numerof and Associates, expects a rocky road going forward. Mergers are difficult to do well under normal circumstances, but a mega-merger is rarely a normal circumstance — it’s more complex, and more challenging to do well given that the healthcare industry is going through a fairly big transition.
In most of these scenarios, said Numerof, the intent was honorable. They wanted to lower costs and improve quality and do better by the consumers who depend on them. That’s the message that’s expressed publicly, anyway, and the Federal Trade Commission and the Department of Justice have generally been willing to accept these sentiments.
Numerof said regulators should be taking a closer look at whether these deals are sound from a financial perspective, and in fact will deliver on that promise.
“I am very skeptical of this,” she said. “The reality is that around 40 percent of M&A in general, across industries, fail to deliver on the financial performance that the parents coming together in the first place wanted to achieve. The fact that there is so much evidence against the likelihood of success should be a data point the Department of Justice takes into account.”
A lot of the healthcare mergers that have taken place over the past five to eight years have been a response to the Affordable Care Act, said Numerof, and were intended as a bulwark against negotiations with insurance companies, essentially giving the buyers more negotiating clout when coming to the table as contract rates are being revisited.
It has also, she said, become a mechanism for these delivery systems to put more pressure on independent physicians, something of a dying breed in the industry.
The issue for these merging organizations is that, while they feel there’s safety in numbers, the deals add another layer of complexity into their business models.
CHANGING BUSINESS MODELS
Even under the best circumstances, M&A often fails to live up to the promise that was established.
“It’s because merger and acquisition integration, which would allow these mergers to realize the potential behind them, requires an enormous amount of work, and most organizations don’t take into account the time that’s required, the focus that’s required, and some of the cultural dynamics that are going to be at play,” said Numerof. “And many don’t take these considerations into account when they evaluate potential partners.”
When these deals are completed, there’s often a “glow” that follows, with a general sentiment that the decision will be good for business. Then reality sets in.
As an example, there’s one very successful pharmaceutical company that has a set of products centered around a speciality disease. The company was acquired for a significant chunk of change by one of the major pharma companies, which promised the smaller company that, due to its success, it would be allowed to operate as independently as possible.
Less than a year later, the company is being broken apart, and the components are being integrated into the infrastructure of the larger company. That has led to some bureaucratic overlay, and defections from people who don’t want to work for a larger company.
In some cases, mergers occur and then the participating parties want to jump ship.
“You have companies coming together, healthcare systems that came together with a lot of fanfare, and after about five to seven years they all agree this was not a good situation, and the company divests all of the assets and individual units,” said Numerof. “So this is very expensive, and not necessarily very good for the community.”
Size is almost never protective, she said. Bond ratings are going down. Some deals, like CVS-Aetna, which was recently approved by the DOJ, will have to do things very different than they have historically in order to be successful — and that will be a struggle in a challenging market environment.
PROPOSAL
In order to avoid risk, there are certain elements companies should consider.
“One of the first tenets is you’ve got to be very clear when defining the joined vision of the company, and articulate how the separate histories of these companies is going to come together to create a different whole,” said Numerof.
“One of the key points here is the strength of each of the companies. When two companies are weak, it’s like entering into a marriage. With two weak people, it doesn’t work. If you have strong companies coming together strategically because they both see opportunities for growth, where they can leverage each others’ trends, that puts them in a much better position.”
There are always opportunities for cost reduction, but they’ve got to have a new business model. That model has to take into account a new go-to-market strategy, and take into account what’s going to happen in terms of the portfolio — how customers are going to be taken care of, are what the infrastructure requirements are going to be.
An important consideration is redefining core roles and competencies, and sorting out which core values will endure in the combined entity. That will essentially be the glue that holds the enterprise together, and it will require communication; management structure will be crucially important in making the endeavor work long-term.
They’re all factors to consider, especially given that Numerof expects more mega-mergers in the future.
“I think we’re going to see more mega-mergers until the DOJ says,’This is not in the best interest of consumers, the economy, and the ability to compete,'” she said.
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HENRY KOTULA 