After a tough 2016, market analysts say that this year they expect a better investment climate in many healthcare sectors.
Tag Archives: ACA
Why some KC-area hospitals are still throwing their hat into ACA payment model
http://www.bizjournals.com/kansascity/news/2017/01/26/prime-healthcare-aco.html
A Kansas City-area health network may benefit from its new designation through a pilot program created under the Affordable Care Act — if it isn’t repealed. As an accountable care organization (ACO), physicians affiliated with the Prime Healthcare ACO in Kansas and Missouri could benefit from cost-sharing incentives for Medicare patients.
Specifically, providers and the Centers for Medicare and Medicaid Services would split the savings from reducing costs for a patient through coordinated care, such as not ordering duplicate tests. Of course, ACO providers still must meet key quality metrics.
“It’s looking back at those procedures that have already occurred,” said Paula Ellis, chief nursing officer at Saint John Hospital, a Prime Healthcare affiliate in Leavenworth. “It’s really being a lot more mindful, and looking at all of the information that’s out there. It’s seeing where (the patient) is getting care that their primary care provider doesn’t know about.”
Prime Healthcare also owns Providence Medical Center in Kansas City, Kan., St. Joseph Medical Center in Kansas City, Mo., and St. Mary’s Medical Center in Blue Springs
While savings between different ACO providers have been mixed, Ellis said other markets under Prime Healthcare have found success. The California-based for-profit hospital operator launched its first ACO in California last year.
Its application for the Kansas City ACO model was granted on Jan. 1. It is serving about 10,000 Medicare patients who use Prime Healthcare physicians as their primary care provider.
“The model’s been out there for a few years,” Ellis said. “It has a track record.”
It’s worth noting that the future of ACOs, for the most part, is unknown. The model is part of the Medicare Shared Saving Program, established under the Affordable Care Act, to reduce costs and improve care. A substantial number of providers have adopted it; CMS reported 480 ACOs served a total of 9 million assigned beneficiaries as of January.
WEB BRIEFING FOR JOURNALISTS: REPEALING AND REPLACING OBAMACARE
Web Briefing for Journalists: Repealing and Replacing Obamacare
With passage of budget resolutions in the House and Senate, Congressional efforts to repeal and replace the Affordable Care Act are underway. Key issues for Republicans in Congress and the Trump Administration have emerged around how quickly to move forward with partial repeal of the ACA through a budget reconciliation measure and whether replacement proposals should be considered simultaneous with a repeal debate. A variety of Congressional repeal proposals have been floated – including one by Rep. Tom Price, President Trump’s nominee for Secretary of Health and Human Services — but none have yet come up for a vote.
On Wednesday, January 25, the Kaiser Family Foundation hosted a web briefing for journalists to answer questions and sort through possible scenarios for repealing and replacing the ACA, including implications for coverage, the insurance market, the Medicaid program, and women’s health.
Panelists included Larry Levitt, senior vice president for special initiatives and co-executive director of the Foundation’s Program for the Study of Health Reform and Private Insurance; Usha Ranji, the Foundation’s associate director for women’s health policy; Diane Rowland, the Foundation’s executive vice president. Rakesh Singh, the Foundation’s vice president for communications, moderated.
Medicaid Financing: The Basics
Medicaid represents $1 out of every $6 spent on health care in the US and is the major source of financing for states to provide coverage to meet the health and long-term needs of their low-income residents. Medicaid is administered by states within broad federal rules and jointly funded by states and the federal government. President-elect Trump and other GOP proposals have put forth fundamental changes in Medicaid financing. This brief examines the following 3 key Medicaid financing questions:
- How does Medicaid financing work now? States design their Medicaid programs within broad federal rules; in return, Medicaid provides a guarantee of federal matching payments with no pre-set limit. There are special match rates for the ACA, administration and other services. Medicaid also provides “disproportionate share hospital” payments to hospitals serving many Medicaid and uninsured patients.
- How much does Medicaid cost and how are funds spent? Payment to private managed care organizations (MCOs) account for 43% of Medicaid spending. Almost two-thirds of all Medicaid spending is for the elderly and persons with disabilities, who make up just one-quarter of all Medicaid enrollees. Medicaid enrollment and spending increases during recessions. Medicaid growth per enrollee has been lower than private health spending. The ACA has provided a significant amount of federal dollars to states.
- What is the role of Medicaid in federal and state budgets? Medicaid is the third largest domestic program in the federal budget following Medicare and Social Security. Medicaid is a spending item but also the largest source of federal revenues for state budgets. In responding to two major recessions in the last 15 years, states have adopted an array of policies to control Medicaid spending growth. Research shows that the influx of federal dollars from Medicaid spending has positive effects for state economies.
Medicaid Pocket Primer
WHAT IS MEDICAID?
Medicaid is the nation’s public health insurance program for people with low income. The Medicaid program covers more than 70 million Americans, or 1 in 5, including many with complex and costly needs for care. The vast majority of Medicaid enrollees lack access to other affordable health insurance. Medicaid covers a broad array of health services and limits enrollee out-of-pocket costs. The program is also the principal source of long-term care coverage for Americans. As the nation’s single largest insurer, Medicaid provides significant financing for hospitals, community health centers, physicians, and nursing homes, and jobs in the health care sector. The Medicaid program finances over 16% of all personal health care spending in the U.S.
HOW IS THE MEDICAID PROGRAM STRUCTURED?
Medicaid is a federal-state program. Subject to federal standards, states design and administer their own Medicaid programs. Beyond the federal requirements, states have extensive flexibility to determine covered populations, covered services, health care delivery models, methods for paying physicians and hospitals, and many other aspects of their Medicaid programs. States can also get Section 1115 waivers to test and implement approaches that diverge from federal Medicaid rules but that the Secretary of Department of Health and Human Services (HHS) determines advance program objectives. All Americans who meet Medicaid eligibility requirements are guaranteed coverage.
The federal government matches state Medicaid spending on an open-ended basis. The guarantee of federal matching funds increases state resources for coverage of their low-income residents and also permits state Medicaid programs to respond to demographic and economic shifts, changing coverage needs, technological innovations, public health emergencies such as the opioid addiction crisis, and disasters and other events beyond states’ control. Medicaid is a complex program because it has evolved over time to serve diverse populations with a wide range of needs, including many individuals who are very poor and very frail, and because of wide variation across state Medicaid programs. The Centers for Medicare and Medicaid Services (CMS) within HHS is the federal agency responsible for Medicaid. Title XIX of the Social Security Act and a large body of federal regulations govern the program, defining federal Medicaid requirements and state options and authorities.
Medicaid Financing: The Basics
Why risk adjustment is a crucial component of individual market reform
The mantra of ‘Repeal and Replace’ has escalated in recent weeks, though what, specifically, the ‘Replace’ component might look like is still unclear. However, many of the current proposals include, at a minimum, some type of continuous coverage provision that allows people with chronic health conditions who have continuously maintained coverage to buy health insurance at standard rates. For example, Paul Ryan’s A Better Way proposal and Tom Price’s Empowering Patients First Act would each prohibit insurers from charging sicker patients more than standard premiums in the individual market as long as they have maintained continuous coverage since before becoming sick.
Such provisions are important to keep patients from seeing their health insurance premiums sky-rocket after becoming sick, which would defeat the purpose of insurance in the first place. However, these provisions also require that insurers sell policies to these patients at premiums that they know will not cover their expected health care spending, generating losses for the insurance company. On its own, this would create a situation where insurers have a strong financial incentive to avoid enrolling these sicker patients.
Risk adjustment combats disincentives to provide coverage for sicker patients
In order to mitigate these incentives for insurance companies to avoid sicker patients, policymakers will need to include a risk adjustment program in any replacement reforms that require insurers to issue insurance to any applicant (also known as “guaranteed issue”) and set limits on adjusting premiums to fully reflect an enrollee’s health status. Continuous coverage provisions are one example of such limits, but risk adjustment will be necessary to combat against adverse selection across a wide range of potential reforms.
A risk adjustment program would make behind-the-scenes financial transfers to insurers to adequately compensate them for enrolling these sicker patients when they are not allowed to charge the individual higher premiums. Risk adjustment will be necessary to promote a well-functioning market where private insurers compete based on the value they deliver and not simply by avoiding sicker patients.
Improving Quality and Value in the U.S. Health Care System
https://www.brookings.edu/research/improving-quality-and-value-in-the-u-s-health-care-system/
Executive Summary
The U.S. health care system faces significant challenges that clearly indicate the urgent need for reform. Attention has rightly focused on the approximately 46 million Americans who are uninsured, and on the many insured Americans who face rapid increases in premiums and out-of-pocket costs. As Congress and the Obama administration consider ways to invest new funds to reduce the number of Americans without insurance coverage, we must simultaneously address shortfalls in the quality and efficiency of care that lead to higher costs and to poor health outcomes. To do otherwise casts doubt on the feasibility and sustainability of coverage expansions and also ensures that our current health care system will continue to have large gaps — even for those with access to insurance coverage.
There is broad evidence that Americans often do not get the care they need even though the United States spends more money per person on health care than any other nation in the world. Preventive care is underutilized, resulting in higher spending on complex, advanced diseases. Patients with chronic diseases such as hypertension, heart disease, and diabetes all too often do not receive proven and effective treatments such as drug therapies or selfmanagement services to help them more effectively manage their conditions. This is true for insured, uninsured, and under-insured Americans. These problems are exacerbated by a lack of coordination of care for patients with chronic diseases. The underlying fragmentation of the health care system is not surprising given that health care providers do not have the payment support or other tools they need to communicate and work together effectively to improve patient care.
While many patients often do not receive medically necessary care, others receive care that may be unnecessary, or even harmful. Research has documented tremendous variation in hospital inpatient lengths of stay, visits to specialists, procedures and testing, and costs — not only by different geographic areas of the United States, but also from hospital to hospital in the same town. This variation has no apparent impact on the health of the populations being treated. Limited evidence on which treatments and procedures are most effective, limited evidence on how to inform providers about the effectiveness of different treatments, and failures to detect and reduce errors further contribute to gaps in the quality and efficiency of care. These issues are particularly relevant to lower-income Americans and to members of diverse ethnic and demographic groups who often face great disparities in health and health care.
Reforming our health care delivery system to improve the quality and value of care is essential to address escalating costs, poor quality, and increasing numbers of Americans without health insurance coverage. Reforms should improve access to the right care at the right time in the right setting. They should keep people healthy and prevent common, avoidable complications of illnesses to the greatest extent possible. Thoughtfully constructed reforms would support greater access to health-improving care — in contrast to the current system, which encourages more tests, procedures, and treatments that are at best unnecessary and at worst harmful.
This report reviews the evidence on a range of payment and delivery system reforms designed to improve quality and value. It reaches several conclusions:
What’s the biggest test Trump will face in 2017? ‘Bipartisan support’ for Obamacare’s replacement
President-elect Trump created a huge challenge for himself by vowing to repeal Obamacare and replace it with “something great,” with details to follow the election. Now he must deliver without creating a lasting political liability for his new administration.
Repeal is easy. The money aspects of Obamacare—subsidies to make insurance affordable, penalties for not having insurance, expanded Medicaid funding and added taxes—can all be scrapped by using the budget reconciliation process that requires only a majority vote in each chamber and the president’s signature.
But repeal by itself would create a human and political disaster. At least 20 million people would lose their health insurance; millions of others would be unable to buy affordable coverage in a chaotic individual insurance market; many doctors, hospitals and other health providers would lose paying customers; and states would feel the pinch of cuts in federal Medicaid money. Ironically, many of the states that made the most dramatic progress reducing their uninsured populations under Obamacare, and would suffer the most disruption from repeal, are the Rust Belt and Appalachian States that put Trump over the top. To avoid starting the new administration in a political hole, “Repeal” must be followed promptly by “Replace” (with a smooth transition between the two), as the president-elect himself pointed out on “60 Minutes.”
The political challenge is that the replacement for Obamacare must have broad bipartisan support—and not just because Republicans have only 52 seats in the Senate and need 60 votes to quash a filibuster. More importantly, as the history of Obamacare illustrates, health reform supported by only one party is unlikely to survive in this deeply polarized nation. If President Trump is to create a lasting legacy in health care, not just another political football, he needs buy-in from most of his own party and a significant fraction of Democrats.
Republican governors have a stake in keeping the Medicaid expansion. Will congressional Republicans listen?
https://www.brookings.edu/blog/fixgov/2017/01/24/medicaid-governors-and-congress/
The House and Senate took the first steps two weeks ago towards an eventual repeal of parts of the Affordable Care Act (ACA). At the same time, significant uncertainty as to how efforts proceed from here remains. There are disagreements among congressional Republicans on virtually every component of a path forward, including a timeline, the connections between a repeal bill and an approach to replacement, and what, if any, components of the law should be preserved.
One important set of actors, however, has already begun to weigh in on the process: several of the nation’s Republican governors. In particular, a number—including Charlie Baker of Massachusetts, Rick Snyder of Michigan, John Kasich of Ohio, Asa Hutchinson of Arkansas, and Brian Sandoval of Nevada—have voiced concerns about eliminating the Medicaid expansion. Together, these governors—several of whom recently met with members of the Senate Finance Committee to discuss the law—lead roughly one third of the 16 states that chose to expand Medicaid and currently have Republican executives. According to new data from the Kaiser Family Foundation, they represent roughly 2.2 million individuals who enrolled in Medicaid in 2015 thanks to the ACA’s expansion, or roughly 6 percent of the total population in these states. (By comparison, the national average for states for which Kaiser was able to obtain data is roughly 7 percent of a state’s population.)
In the case of Medicaid, as political scientist Shanna Rose has demonstrated, Republican governors have a long history of taking a different tack than their national counterparts. One source of this state-level variation involves the ability of the Secretary of Health and Human Services to waive provisions of federal law, at a state’s request, to allow for Medicaid pilot, or demonstration, programs. Beginning in earnest during the Reagan administration and escalating in particular under Clinton, governors nationwide have experimented with service delivery through waivers. Some feared that this experimentation could lead to restricted access, but research by Frank Thompson and Courtney Burke finds that, pre-ACA, governors more often than not used section 1115 Medicaid waivers to expand access for low-income Americans. This historical trend has continued throughout the ACA era, as governors have bargained with the Obama administration to secure waivers that expand access to Medicaid in their states.
HENRY KOTULA 