Tag Archives: Medicare

Healthcare: It’s complicated

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http://www.theactuary.com/features/2017/07/its-complicated/

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It has been a little over seven years since the US began implementing healthcare reform at the national level, following the passage of the Patient Protection and Affordable Care Act (ACA), also known as Obamacare. However, the future of the law’s programmes has never seemed more uncertain now that the United States House of Representatives has passed legislation repealing and replacing many of the ACA’s key provisions.

While the ACA and the proposed replacement legislation are fundamentally different in their approaches to financing and regulating healthcare, they do have one thing in common: both are extraordinarily complicated.

Actuaries have had a front-row seat as healthcare reform has unfolded, and they are in a unique position to help address the challenges our complex system presents – whether that involves setting premium rates, calculating reserves, or just trying to explain healthcare policy to their Facebook friends. After all, actuaries were working to promote the financial stability of our complex healthcare system long before the ACA came along.

Even so, one might ask: Why is the American healthcare system so complicated? Does it have to be that way? Most stakeholders acknowledge that our current system has room for improvement, although opinions vary widely on what to do about that. In part, the complexity of our system is rooted in our history.

The healthcare system that we have today wasn’t formed in one fell swoop. Instead, it has been stitched together gradually over the past century by policymakers working to meet the challenges of their times. For example, the prevalence of employer-sponsored insurance was at least partly driven by price-wage controls implemented by the federal government in the 1940s during the Second World War, together with very favourable tax treatment. When the employer-sponsored market began to flourish, healthcare coverage became unaffordable for the non-working population – in particular, low-income workers, seniors, and disabled individuals – and the Medicare and Medicaid programmes were born. Currently, healthcare in the US is provided and funded through a variety of sources:

  • Employer-sponsored insurance – either self-funded by the employer or insured through a carrier
  • Individual major medical insurance – currently subsidised by the federal government for many individuals under the ACA
  • Medicare, Medicaid, and military health coverage – subsidised by federal and state governments and increasingly administered by privately managed care organisations
  • Other – for instance, the Indian Health Service, care provided to correctional populations, and uncompensated care provided to the uninsured.

 

It’s therefore not surprising that the policies being proposed today are an attempt to fix the problems we currently face, such as expanding access to affordable healthcare, reducing the cost of healthcare, or improving the quality of care received by patients.

However, our system has evolved in such a way that trying to implement a solution is like trying to solve a Rubik’s Cube – it is hard to make progress on one side without introducing new problems into other parts of the puzzle. For a Rubik’s Cube, successful solvers focus on both the local and global picture, and sometimes must make short-term trade-offs to achieve a longer-term solution. Unfortunately, the short-term nature of political pressures make it difficult to implement longer-term strategies for healthcare. Yet, we see many areas where actuaries can be instrumental in addressing the challenges presented by our complex healthcare system.

Complex times call for complex models

The ACA made sweeping changes that impacted almost every source of coverage listed above. The most profound changes, besides the expansion of Medicaid coverage, were the changes made to the individual and small employer health insurance markets. These already small markets were fractured into several separate pieces (grandfathered business from before the ACA became law, ‘transitional’ business issued before 2014, and ‘ACA-compliant’ business issued in 2014 and beyond). The only constant has been change, with many regulatory changes occurring each year (often after premium rates were set by insurers) and with the stabilisation programmes intended to mitigate risk during this time of change often paradoxically increasing uncertainty. This led some to question whether these markets were inherently too unpredictable to be viable, whereas others felt that the markets were finally starting to stabilise before the election changed everything.

Besides predictability problems caused by regulatory or political factors, two challenges facing health actuaries during these transitional years have been (1) the lag between when market changes are implemented and when data on policies subject to the new rules becomes available, and (2) the difficulty in predicting consumer behaviour in reaction to major changes in market rules such as guaranteed issue and community rating. How many of the uninsured would sign up? How price-sensitive would members be when they renewed their coverage each year? How will changes in other sources of coverage (such as Medicaid expansion) impact the individual market? How will potential actions by competitors affect an insurer’s risk?

Despite the daunting nature of these challenges, actuaries have, out of necessity, found ways to try to address them. For example, faced with the data lag problem, they explored ways to augment traditional claim and enrollment data with new data sources such as marketing databases or pharmacy history data available for purchase. Such sources can be used to develop estimates of the health status of new populations not previously covered by an insurer. Many actuaries also developed agent-based stochastic simulation models that attempted to model the behaviour of consumers, insurers and other stakeholders in these new markets. Such models continue to be used to evaluate the potential outcomes of future changes to the healthcare system, and will probably be essential should efforts to repeal and replace the ACA prove successful.

Information problems: what is a rational actor to do?

Most goods and services in the US have a price tag that consumers can use to ‘shop’ for the option that they feel gives them the best value for their dollar. Healthcare is different. If you ask how much a healthcare service will cost in the US, the answer is “it depends”. List prices such as billed charges for hospitals and physicians and average wholesale prices for pharmaceuticals are increasingly meaningless, given the enormous contractual discounts and rebates that typically apply. The same service may have wildly different prices depending on who is paying for it, and prices may not correlate well with either the clinical value the service provides to the patient or the actual cost to the healthcare provider who renders it. Layered on top of this complex foundation are the often arcane policy provisions that determine a member’s ultimate cost for a claim.

Moreover, even if a patient can determine the cost of treatment at different healthcare providers, making an informed choice often requires clinical knowledge the average person is unlikely to possess. Also, many of the most costly services are non-discretionary and often emergent in nature. In other words, even if a consumer wanted to shop they would be hard-pressed to do so.

All of this means that it is exceedingly hard for various stakeholders – patients, doctors, even insurers – to know the true cost of a service at the point of care, much less manage it. Yet a lot of effort has been spent in trying to better align cost incentives for providers and patients. Past efforts have often used crude methods, such as high deductibles paired with health savings accounts, to create incentives. Current efforts such as value-based insurance designs, which vary cost sharing based on a patient’s clinical profile, use more nuanced approaches to encourage patients to use high-value care. Moving from fee-for-service to value-based payment models for reimbursing healthcare providers has been a focus of both private and public payers in the US.

While such initiatives show promise, they come at the price of even more complexity – and it isn’t always clear that this price is worth paying. The proliferation of more complex benefit designs and provider contracting arrangements can exacerbate the price transparency problems that existed even in the relatively simple fee-for-service world.

Actuaries are well equipped to help insurers, providers and consumers navigate these waters. For example, repricing healthcare claims in an equitable way using actuarial techniques, such as comparing reimbursement rates with a standard fee schedule, is

an efficient way for providers and payers to evaluate cost levels consistently across contracts that may use very different reimbursement methodologies.

Actuaries also have a role to play in developing tools to support clinicians and consumers in understanding the financial dimensions of their healthcare decisions.

Technology: the cause of, and solution to, all our cost problems?

For better or worse, Americans seem determined to seek technological solutions to our health problems, even when lifestyle changes in diet and exercise habits might be just as effective.

Technological advances drive a significant portion of healthcare cost increases, and while many do result in profoundly valuable new therapies, some provide only marginal benefit over existing options at a significantly higher cost. Finding ways to leverage our love of technology to achieve health outcomes more cheaply would be a worthy goal, and one where an actuary could make a difference. Work to use machine learning (for example, in radiology), smarter medical devices, and other data-intensive methods to improve healthcare are still in their infancy, but show promise. From a policy perspective, actuaries could assist in designing novel approaches toward rethinking the incentives for clinical innovation, such as linking payment for new therapies to their clinical value relative to alternatives.

Will the US ever change its relationship status with healthcare from “it’s complicated” to something less ambiguous? In the near term, the answer seems to be “no.” But perhaps we can hope that – with a little help from actuaries – even a complicated relationship can be a good one.

Forgotten Heroes: Remembering Dr. Alvin Blount, Who Helped Integrate America’s Hospitals

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http://healthaffairs.org/blog/2017/09/01/forgotten-heroes-remembering-dr-alvin-blount-who-helped-integrate-americas-hospitals/

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Mortar rounds shook the bunker. The 8225th Mobile Army Surgical Hospital (MASH) was crammed with casualties—civilians, Americans, and KATUSAs (Korean Augmentation to US Army). The four surgical tables under the direction of its acting chief surgeon, Alvin G. Blount, often operated around the clock, doing as many as 90 surgeries during sleepless protracted engagements. Blount could shut out the mayhem and focus only on his patient’s needs, as if everything else in the world had stopped. His calm, gentle demeanor commanded respect. His was the first racially integrated MASH unit, and he was its first black chief surgeon. Blount received the Korean War Service Medal for these efforts and would later become part of a group of doctors that helped radically reform US health care. He died earlier this year, the last surviving member of the group that initiated that effort.

The stories of the Korean MASH units would become popularized in a book, a movie, and a popular television series called M*A*S*H that ran from 1972 to 1983 and still appears in syndicated reruns. Yet, in an apparent attempt to assure “historical accuracy,” the television series chose to eliminate the black surgeon that appeared in the book and movie version.

After the war, Blount returned to private practice in racially segregated Greensboro, North Carolina. His Howard University medical school mentor, Charles Drew had warned him, “you boys going south will have to sweat it out, but victory will come.” Despite the US Supreme Court’s 1954 ruling in Brown v. Board of Education of Topeka that separate was inherently unequal in education, “separate but equal” remained the law of the land for hospitals. The Hill-Burton Act of 1946 specifically permitted federal funding for the construction of the two white-only hospitals in Greensboro and made similar provisions for other Southern cities. Black physicians in Greensboro were excluded from medical staff privileges at these white hospitals, one of which was the Moses H. Cone Memorial Hospital, the most well-endowed hospital in the region. Segregation in hospitals remained for another decade as Blount and a few courageous colleagues engaged in a polite and seemingly fruitless struggle against a powerful, entrenched white establishment.

George Simkins, Jr., a dentist and aggressive activist, took charge of the Greensboro chapter of the National Association for the Advancement of Colored People (NAACP) in the early 1950s and sought the help of the NAACP Legal Defense and Educational Fund (LDF) to challenge the city’s segregated hospital system. But recruiting black physicians to join as plaintiffs proved difficult. Some were comfortable with the status quo, and most were concerned about damaging ties with white colleagues, who they relied on for help with their patients. Blount himself was reluctant, but he was close friends with Simkins and knew that the segregated system resulted in lower-quality care for his patients. Blount joined the lawsuit and helped Simkins recruit five other physicians to do the same. These five physicians, in addition to two black dentists, two black patients, Blount, and Simkins, made up the final list of 11 plaintiffs. Michael Meltsner, a young, white protégé of Thurgood Marshall, served as lead attorney.

The suit, filed in US District Court in 1962, argued that Greensboro’s two white hospitals, the Moses H. Cone Memorial Hospital and the Wesley Long Hospital, functioned as an “arm of the state,” having received a total of $2.8 million in federal Hill-Burton program funds. By remaining segregated, the hospitals violated the due process and equal protection clauses of the Fifth and Fourteenth Amendments of the US Constitution. Accordingly, the plaintiffs argued, the Hill-Burton law was unconstitutional because it provided federal funding for the construction of racially segregated institutions. As is customary with any case challenging federal law, the US attorney general was given the opportunity to defend the federal government. Surprisingly, however, Attorney General Robert Kennedy joined the plaintiffs, seizing the opportunity to push the administration’s stalemated civil rights agenda. Despite this unexpected support, the District Court dismissed the suit. The “victory” that Charles Drew had promised seemed increasingly distant.

Blount and his fellow plaintiffs, however, now found themselves at the beginning of a long and unpredictable journey to transform US health care. In a 3:2 decision in 1963, the US Court of Appeals of the Fourth Circuit ruled in favor of the plaintiffs. The hospital defendants appealed to the US Supreme Court, but in a rushed ruling, just days before the Senate began its longest debate on the Civil Rights Act of 1964, the Court chose to not review the lower court decision and let it stand. Title VI of the Civil Rights Act, the most likely provision to be eliminated to assure the bill’s passage, prohibited the provision of any federal funding to organizations that discriminated on the basis of race. By letting the Fourth Circuit decision stand, the Supreme Court effectively made Title VI the law of the land before it had even passed through the legislative branch.

Resistant to any federal interference in their organization, the executive committee of the board of the Moses H. Cone Memorial Hospital recommended to the full board that the hospital return its Hill-Burton funds to the federal government to relieve it of any obligation to desegregate. That recommendation was rejected. Nothing in the Court’s decision, of course, prevented other hospitals from choosing not to apply for Hill-Burton construction funds or from returning funds they had already received. There was also no provision in the law for federal enforcement for those hospitals that had already received federal money. The NAACP LDF or other parties could mount challenges against individual hospitals, but it would be a slow and costly process.

The Medicare legislation enacted less than a year later, however, changed the game. Hospitals could survive without Hill-Burton funds, but they could not “choose” not to be Medicare and Medicaid providers. No hospital would be certified as a Medicare provider without being fully compliant with concrete nondiscrimination requirements. Local civil rights groups whose members included hospital workers served as the final arbiters. Any lapses in enforcement by federal volunteer inspectors or subterfuge by the hospitals would not escape notice.

In less than six months, 6,000 hospitals became fully compliant. Thanks to Medicare, America’s hospitals went from being our country’s most racially and economically segregated institution to our most integrated. Almost all of the separate wooden bench waiting rooms and welfare wards disappeared. Patterns of use of services that had always been shaped by racial and economic privilege began, for the first time, to reflect actual medical need. Over the next 20 years, racial and economic disparities in infant mortality and life expectancy narrowed. In Greensboro, Blount became the first black surgeon to operate at Moses H. Cone Memorial Hospital. Yet, the events that propelled all of these changes have been almost forgotten. Only current political events in North Carolina and nationally have stirred some local reflection about that past.

A statue of Simkins was unveiled on the lawn of the Guilford County Courthouse in October 2016, near where he was jailed for trespassing in 1955 after trying to play golf with friends on the city-owned golf course. Only after his death was he honored as the city’s “Moses.”

In 2016, Blount, at age 94, was the only surviving plaintiff in the Simkins v. Moses Cone Hospital suit. He was still seeing a limited number of patients under the watchful eye of his loyal long-time practice manager, Martha Reid. His office on East Market Street was filled with memorabilia and memories of more than a half century of practice. In October, he was invited to a meeting at the regional nonprofit integrated health system that Moses H. Cone Memorial Hospital became. About 250 health care professionals and community leaders attended, along with Blount’s children. Dr. James Wyatt, a black surgeon and president of the Cone Health medical and dental staff, thanked Blount “for opening doors for me.” Cone CEO, Terry Akin, addressed Dr. Blount: “It seems to me, and to our medical and dental staff, that we needed to take the opportunity to apologize for our role in this chapter of our history and to honor these individuals for challenging us to be our best selves, and for their foresight and courage in changing America.” Cone donated $250,000 to a scholarship fund honoring Blount and the other plaintiffs that will provide support for minority students pursuing careers in health care. It will be administered by the Greensboro Medical Society, one of many local black medical societies across the country that played a key role in the hospital desegregation struggle. A month later, a historical highway marker was unveiled on North Elm Street adjacent to the Moses H. Cone Memorial Hospital, acknowledging the plaintiffs and their role in changing the nation’s hospitals.

Dr. Blount passed away on January 6, 2017, at Moses H. Cone Memorial Hospital after a brief illness. His family marked his passing with a quiet event at the small Episcopal church adjoining the North Carolina A&T State University campus, which served as an early organizing center for the lunch counter sit-in movement. “My life is my memorial,” he had told his practice manager. “No big casket or cemetery plot either—cremation. … Just be sure I’m dead before you burn me.”

His life was indeed his memorial. From caring for wounded soldiers in Korea to feeding arrested Dudley High School students after a lunch counter sit-in, Blount was an endless source of compassion and integrity. He and his wife lovingly raised seven children, and his youngest daughter, Gwen Blount Adolph, now a lawyer in New York, recently reflected on her father’s life: “My daddy was a gentle soul who wanted to do right by everyone.” She recalled the night the arm fell off her brother Alvin’s teddy bear, and he was inconsolable. “We all had this vivid memory of my dad taking needle and thread and operating on Teddy…. We all gathered around, as if it was an operating room. He was so patient, and it was so important to my brother. It was as if everything else in the world had stopped—that was Daddy.”

In these divisive times, it is too easy to be dismissive of the past and despairing about the future. The lives of Dr. Blount and the other Moses Cone plaintiffs tell us something different. They tell us that landmark pieces of social policy such as Medicare, when implemented fairly and compassionately, can promote justice and equality. And they tell us that the power to remedy injustices lies with individuals who are willing to challenge the status quo and further the cause of universal health care for all Americans.

What is a SNP?

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http://bettermedicarealliance.org/snps?utm_source=rollcallheadlines&utm_medium=email&utm_campaign=newsletters

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SNPs are a type of Medicare Advantage plan that are paid and regulated in the same way as other Medicare Advantage plans, but have the authority to provide specialized care to serve beneficiaries who are dually-eligible for Medicare and Medicaid, have certain chronic conditions, or receive long-term care in an institutional setting such as a Skilled Nursing Facility. In addition to providing all Medicare Part A and Part B benefits, SNPs must also exceed these core benefits by providing reduced cost sharing, individualized care plans, and other tailored benefits related to mental health, social services, and wellness.

Appeals court overturns ruling requiring HHS to clear Medicare appeals backlog by 2021

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http://www.beckershospitalreview.com/finance/appeals-court-overturns-ruling-requiring-hhs-to-clear-medicare-appeals-backlog-by-2021.html

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The U.S. Appeals Court for the District of Columbia on Friday overturned an order requiring HHS to clear its backlog of Medicare reimbursement appeals by the end of 2020.

On Dec. 5, 2016, U.S. District Judge James Boasberg granted a motion for summary judgment filed by the American Hospital Association in AHA v. Burwell — a lawsuit that centers on the Recovery Audit Contractor Program.

He ordered HHS to incrementally reduce the backlog of 657,955 appeals pending before the agency’s Office of Medicare Hearings and Appeals over the next four years, reducing the backlog by 30 percent by the end of 2017; 60 percent by the end of 2018; 90 percent by the end of 2019; and to completely eliminate the backlog by Dec. 31, 2020.

HHS filed a motion Dec. 15, 2016, asking the judge to reconsider his decision. HHS argued it would be impossible to reduce the appeals backlog on the schedule provided by the court without improperly paying claims, regardless of merit. In January, Judge Boasberg denied HHS’ motion for reconsideration.

In late January, HHS filed an appeal in the case, seeking to avoid the district court’s order enforcing the plan to clear the appeals backlog by the end of 2020.

On Friday, the appellate court sided with HHS.

Since HHS said it was impossible to lawfully comply with the district court’s order, the appellate court ruled it was “an error of law” and “an abuse of discretion” for the district court judge to order HHS to abide by the schedule to clear the Medicare appeals backlog.

“In sum, it was an abuse of discretion to tailor the mandamus relief without tackling the Secretary’s claims that lawful compliance would be impossible,” states the appellate court’s opinion.

The appellate court held that on remand the lower court should determine if compliance with the timetable to reduce the Medicare appeals backlog is impossible.

Doctor Shortage Under Obamacare? It Didn’t Happen

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When you have a health problem, your first stop is probably to your primary care doctor. If you’ve found it harder to see your doctor in recent years, you could be tempted to blame the Affordable Care Act. As the health law sought to solve one problem, access to affordable health insurance, it risked creating another: too few primary care doctors to meet the surge in appointment requests from the newly insured.

Studies published just before the 2014 coverage expansion predicted a demand for millions more annual primary care appointments, requiring thousands of new primary care providers just to keep up. But a more recent study suggests primary care appointment availability may not have suffered as much as expected.

The study, published in April in JAMA Internal Medicine, found that across 10 states, primary care appointment availability for Medicaid enrollees increased since the Affordable Care Act’s coverage expansions went into effect. For privately insured patients, appointment availability held steady. All of the gains in access to care for Medicaid enrollees were concentrated in states that expanded Medicaid coverage. For instance, in Illinois 20 percent more primary care physicians accepted Medicaid after expansion than before it. Gains in Iowa and Pennsylvania were lower, but still substantial: 8 percent and 7 percent.

Though these findings are consistent with other research, including a study of Medicaid expansion in Michigan, they are contrary to intuition. In places where coverage gains were larger — in Medicaid expansion states — primary care appointment availability grew more.

“Given the duration of medical education, it’s not likely that thousands of new primary care practitioners entered the field in a few years to meet surging demand,” said the Penn health economist Daniel Polsky, the lead author on the study. There are other ways doctor’s offices can accommodate more patients, he added.

One way is by booking appointment requests further out, extending waiting times. The study findings bear this out. Waiting times increased for both Medicaid and privately insured patients. For example, the proportion of privately insured patients having to wait at least 30 days for an appointment grew to 10.5 percent from 7.1 percent.

The study assessed appointment availability and wait times, both before the 2014 coverage expansion and in 2016, using so-called secret shoppers. In this approach, people pretending to be patients with different characteristics — in this case with either Medicaid or private coverage — call doctor’s offices seeking appointments.

Improvement in Medicaid enrollees’ ability to obtain appointments may come as a surprise. Of all insurance types, Medicaid is the least likely to be accepted by physicians because it tends to pay the lowest rates. But some provisions of the Affordable Care Act may have enhanced Medicaid enrollees’ ability to obtain primary care.

The law increased Medicaid payments to primary care providers to Medicare levels in 2013 and 2014 with federal funding. Some states extended that enhanced payment level with state funding for subsequent years, but the study found higher rates of doctors’ acceptance of Medicaid even in states that didn’t do so.

The Affordable Care Act also included funding that fueled expansion of federally qualified health centers, which provide health care to patients regardless of ability to pay. Because these centers operate in low-income areas that are more likely to have greater concentrations of Medicaid enrollees, this expansion may have improved their access to care.

Other trends in medical practice might have aided in meeting growing appointment demand. “The practice and organization of medical care has been dynamic in recent years, and that could partly explain our results,” Mr. Polsky said. “For example, if patient panels are better managed by larger organizations, the trend towards consolidation could absorb some of the increased demand.”

Although the exact explanation is uncertain, what is clear is that the primary care system has not been overwhelmed by coverage expansion. Waiting times have gone up, but the ability of Medicaid patients to get appointments has improved, with no degradation in that aspect for privately insured patients.

Commentary: Why Republicans will always struggle to repeal Obamacare

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http://www.reuters.com/article/us-lemieux-healthcare-commentary-idUSKBN1AJ286

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With John McCain’s dramatic “no” vote, the Health Care Freedom Act (HFCA) died early last Friday morning and with it any hope of repealing the Affordable Care Act (ACA) for the foreseeable future. While conservatives might prefer to blame incompetent vote-whipping in the Senate, the ACA could prove resilient for the same reason Medicare and Social Security have: most voters prefer not to wonder if they will be able to eat when hungry or see a doctor when sick. Any program that gives more economic security to a broad, politically powerful group will be dangerous to meddle with, even in these polarized times.

Conservative activists and pundits who don’t want to contend with that reality may point to the president they were dealt: Donald Trump knew essentially nothingabout health care and he alternated between disengagement and crude bullying of wavering senators ahead of the vote.

Blaming Senate Majority Leader Mitch McConnell is less convincing. McConnell is a masterful legislative strategist and it took his maneuvering to bring a bill supported by less than 30 percent of the public to within one vote of passing. Indeed, McConnell may only have come even that close because he skipped the normal committee hearing process, protecting the proposal from more public and media scrutiny.

The real lesson here is that once major social programs are in place, it’s simply very hard to eliminate them.

In his 1994 book “Dismantling the Welfare State?” the political scientist Paul Pierson showed that major social welfare programs were very resilient, and conservative attempts to repeal them generally failed. This was true even in parliamentary systems with fewer choke points to stop repeal than the American system.

In the United States, the clearest example is Social Security. Before becoming president, Ronald Reagan had a desire to make it a voluntary program, but he quickly abandoned any thoughts of radically restructuring the program after taking office. Instead he oversaw a bipartisan plan to protect the program’s solvency through a combination of regressive tax increases and benefit cuts. When the Republican controlled-Senate narrowly passed a one-year freeze to seniors’ annual cost-of-living adjustment freeze during Reagan’s second term, the president abandoned the unpopular proposal, letting it die in the House of Representatives.

George W. Bush, after winning re-election in 2004, made Social Security privatization his signature domestic issue. Bush travelled the country, making the case for a system of voluntary private accounts to partially replace Social Security for young workers. But the idea was politically toxic, actually becoming less popularthe more Bush discussed it. Congressional Democrats, who had collaborated with Republicans on major domestic legislation during Bush’s first term, came out against the proposal en masse. Republicans controlled both houses of Congress but they refused to take responsibility for highly unpopular changes to a cherished program. No Social Security privatization bill came close to a vote. Republicans have not actively pursued the goal since.

Nor have Republicans had any success at attacking the Great Society’s cornerstone health policy, Medicare. Sometimes they actively go in the opposite direction. In George W. Bush’s first term, Bush worked with Republicans to pass a corporate-friendly expansion of Medicare to partially cover payments for prescription drugs. Tea Party activists consider this one of the Bush era’s major betrayals of small government conservatism. But even arch-conservatives like Rick Santorum voted for the law. The politics were irrefutable: senior citizens vote, mostly Republican, and they fill a lot of prescriptions.

In 2011, now-Speaker of the House Paul Ryan proposed a plan to convert Medicare into a system in which seniors received vouchers (whose value would decrease over time) to purchase health insurance on private markets. The proposal was extremely unpopular and created a major backlash. Ryan has never officially abandoned some form of vouchers as a goal, but he has not put any Medicare restructuring on his legislative agenda since taking the Speaker’s gavel. The Ryan budget’s threat to Medicare, however, proves a reliably spooky specter for Democrats to invoke when sending fundraising emails or appealing to older swing voters.

Social programs are often not fully appreciated by their beneficiaries until someone proposes getting rid of them. Facing an existential threat made the Affordable Care Act much more popular – as then-Speaker of the House Nancy Pelosi predicted, support for it increased once people found out what was in it. The Republican proposals to replace the ACA, conversely, are staggeringly unpopular. As recently as last year, more Americans disapproved of the ACA than supported it, but its approval ratings are now over 50 percent, while the repeal bills started out unpopular and became more so.

The majority support for the ACA wasn’t soft, either. Supporters of the ACA were far more motivated than its opponents during the repeal struggle, putting their time and sometimes their bodies on the line, such as when disabled people were ejected from the offices of members of Congress.  This helps to explain why moderate Republican Senators Susan Collins of Maine and Lisa Murkowski of Alaska (not to mention Democratic senators representing states that Trump won in landslides such as West Virginia and Montana) were unwavering in their opposition. The weekend after the HCFA was voted down, Murkowsi was repeatedly greeted by supporters, some in tears, thanking her for her no vote, while Nevada Senator Dean Heller was rewarded for his “yes” vote by seeing his approval rating plummet to 22 percent.

This doesn’t mean that supporters of the ACA should be complacent. Even when Republicans have failed to eliminate major social programs, they have been able to make them less generous in ways that caused real harm, Reagan’s Social Security adjustment included. Trump is signaling that he will damage the ACA administratively, and 19 states are still refusing the ACA’s generous Medicaid expansion.

Moreover, the failure to eliminate major welfare programs is a tendency, not an iron law. In 1996, President Bill Clinton signed a welfare “reform” bill that led to more than 6 million mothers with children losing welfare benefits.

That was possible partly because welfare, unlike Obamacare, only benefits the poor, who are politically disempowered.

Still, Republicans just came closer to passing a partial repeal of the ACA than many would have thought possible.

The battle over healthcare is far from over, but the repeated failures of the GOP efforts to repeal it prove the political durability of the social safety net.

Medicare proposed changes would cut home health reimbursement

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http://www.healthcarefinancenews.com/news/home-health-agencies-concerned-about-cuts-proposed-medicare-payments?mkt_tok=eyJpIjoiTXpOa01qUXhaVGd5TnpkaiIsInQiOiJudFozOHVLS1VVNXZZRE42Y0RmTWdIZHpkOU0yNERUSmlXU0VCMlJDMEFyMmVTUUc4aVwvcXRVc0gzXC9ndUdJVjhHT1drZkkzdDhBVFhHZ3BHVjI1NmhIVHY1RmNXSENVdWtwb3RVVnVtaFNWbXNFdnBzb0JVenRcL1ZuR1p0MW0zRyJ9

Home health agencies could see decreases of $80 million in 2017 and $950 million in 2019.

Home health providers object to the Centers for Medicare and Medicaid Services’ proposed rule that would reduce Medicare payments by 0.4 percent, or $80 million, in 2018, and up to  $950 million in 2019.

The Partnership for Quality Home Healthcare is especially concerned about a groupings model proposal starting in 2019 that  would change the unit of payment from 60-day episodes of care to 30-day periods of care and places patients in payment groups based on how they fit in six clinical categories.

“CMS is proposing a major reform to home health reimbursement without having worked collaboratively with industry partners like the Partnership and we expect to be included in payment reform development going forward,” said Partnership Chairman Keith Myers. “We question whether CMS has the unilateral authority to make such a proposed change without action by Congress.”

CMS said the six clinical groups used to categorize 30-day periods of care are based on the patient’s primary reason for home healthcare.

The new model could result in a $950 million Medicare payment cuts for home health providers in 2019 if it is implemented in a non-budget neutral manner, according to Home Health Care News. If implemented in a partially-budget-neutral manner, it could reduce payments by $480 million, the report said.

CMS is not proposing a revision to the split percentage payment approach in the change to a 30-day period. However, the agency said it is proposing to phase-out of the split percentage payment approach in the future and is soliciting feedback now.

For 2018, Medicare payments to home health agencies would be reduced by 0.4 percent, or $80 million, based on the proposed policies, CMS projects.

The $80 million decrease reflects the effects of a $190 million increase from a 1 percent home health payment update, a $170 million decrease from a -0.97 percent adjustment to the 60-day episode payment rate to account for nominal case-mix growth, and a $100 million decrease due to the sunset of the rural add-on provision.

The Medicare Access and CHIP Reauthorization Act, or MACRA extended until Jan. 1, 2018 the rural add-on, which increased by 3 percent the payment amount otherwise made for home health services in a rural area.

Additionally, the proposed rule for 2018 refines the home health value-based purchasing model. It revises the applicable measure for receiving performance scores for any of the home health consumer assessment of healthcare providers and systems, or HHCAHPS.

The Partnership for Quality Home Health Care said it plans to release an analysis of the proposed payment model and its impacts on home health delivery.

The coalition is concerned that Affordable Care Act directives for high-risk beneficiaries to receive access to home health services would result in disproportionate cuts to provide the care if the payments are implemented as drafted.

Tuesday’s home health rule is among several proposals that reflect a broader strategy by CMS to relieve regulatory burdens for providers, support the patient-doctor relationship in healthcare and promote transparency, flexibility, and innovation in the delivery of care, CMS said.

“CMS is committed to helping patients and their doctors make better decisions about their healthcare choices,” said CMS Administrator Seema Verma. “We’re redesigning the payment system to be more responsive to patients’ needs and to improve outcomes. The new payment system aims to encourage innovation and collaboration and to incentivize home health providers to meet or exceed industry quality standards.”

ACOs are leaving $886M in net payments on the table, analysis finds

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http://www.beckershospitalreview.com/accountable-care-organizations/acos-are-leaving-886m-in-net-payments-on-the-table-analysis-finds.html

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ACOs in Track 1 of the Medicare Shared Savings Program are losing out on millions of dollars in additional net payments from CMS by not taking on more risk and missing out on the Quality Payment Program’s 5 percent lump sum bonus payment for ACOs in Track 2 and 3, according to an analysis from Avalere.

The analysis simulates how much Track 1 ACOs would earn if they were enrolled in Track 2 — based on 2015 performance — and the QPP was in place. Track 1 ACOs do not bear downside financial risk, and therefore share in a smaller portion of savings than their Track 2 and 3 counterparts. However, if these ACOs had taken on more risk in 2015, they would have earned $178 million more in shared savings, according to the analysis. And if the Track 1 ACOs took on downside risk, they would qualify as an Advanced Alternative Payment Model under the Medicare Access and CHIP Reauthorization Act’s QPP. These models have the opportunity to earn a bonus up to 5 percent on Medicare Part B expenditures — and based on 2015 performance, those ACOs would be leaving $1.1 billion in AAPM bonus payments on the table by not bearing the downside risk necessary to qualify, according to the report.

“The CMS’ new value-based payment incentives really tip the scales for doctors to assume greater financial risk,” Josh Seidman, PhD, senior vice president at Avalere, said in a statement. “For those physicians who were dipping their toes in the water with low-risk ACO models, the incentives now make it advantageous for a majority of them to move more aggressively into greater accountability for population health.”

Of course, some of the ACOs would have also generated net losses. The analysis indicates some of the ACOs in the simulation would have had to pay back CMS for spending above the benchmark. These shared losses would have totaled $437 million. Benefits and losses taken together, if all Track 1 ACOs joined Track 2 of the MSSP and performed as well as they did in 2015, they would earn additional net payments of $886 million, according to the analysis.

However, the majority of ACOs would still benefit by joining Track 2. Avalere found 79 percent, or 307 of the Track 1 ACOs, would have financially benefitted, compared to 21 percent, or 82, that would not.

This year 486 ACOs are participating in Track 1, accounting for most of the MSSP program. Track 2 counts just six participants and Track 3 has 36 ACOs.

How GOP Will Still Carve Up Medicare

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https://www.forbes.com/sites/johnwasik/2017/07/19/how-gop-will-still-carve-up-medicare/#48a9aa5943f1

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Now that the GOP’s plan for repealing and replacing Obamacare seems to be in a coma, the party has turned its attention to the 2018 federal budget.

Although specific spending details in the House committee mark-ups are still being hammered out, the GOP is back to its old script.

The GOP has a working blueprint to cut billions out of federal programs and balance the budget without tax increases. And, among other items, it still wants to privatize Medicare.

Speaker of the House Paul Ryan (R-WI). (Photo by Win McNamee/Getty Images)

Medicare covers more than 55 million Americans. Most of them are 65 or older and millions are permanently disabled. It’s the nation’s second-largest government-managed single-payer plan after Medicaid, which covers some 70 million.

 

While Medicare provides coverage for doctors and hospitals, it also covers prescription drugs if you pay an additional premium. You also have the option to buy into private policies through Medicare Advantage — if you don’t want the fee-for-service part of basic Medicare.

The rehashed House GOP budget blueprint wants to reshape Medicare into more of a Medicare Advantage model, which now covers some 19 million Americans.

What does that mean? Funding for the guaranteed part of Medicare would be shifted into the privatized scheme. You’d receive a fixed stipend or “premium support” to buy a private policy on an exchange.

Buying private plans on an exchange? Where have we heard that before? Oh yes, that was the model for the Affordable Care Act, or Obamacare, which the GOP has spent the last seven yearstrying to repeal. It’s been a staple of House Speaker Paul Ryan’s policy platform for years.

According to the House Budget Committee blueprint:

“The Medicare improvements envisioned in this budget resolution would adopt the popular simplified coverage structure of Medicare Advantage, and allow seniors greater plan choices while reducing costs.

It would resemble the private insurance market, in which the majority of Americans select a single health care plan to cover all their medical needs.”

In theory, having private insurers compete with the government to provide more coverage at a lower cost sounds like a good idea. But is it possible, given the government’s massive economies of scale?

Without generous subsidies, the prospect of insurers offering a better Medicare deal is like the corner grocer trying to compete with Wal-Mart. Moreover, using Medicare Advantage as a model is a horrible idea.

Medicare Advantage insurers have been embroiled in numerous billing scams, according to the non-partisan Center for Public Integrity. The Center, an independent watchdog, has published more than two dozen pieces on this ongoing morass. Here’s a summary of their findings:

“Congress created private Medicare Advantage health plans 11 years ago to help control health care spending on the elderly. But a Center for Public Integrity investigation found that billions of tax dollars are wasted every year through manipulation of a Medicare payment tool called a “risk score.”

The formula is supposed to pay health plans more for sicker patients and less for healthy people, but often it pays too much. The government has for years missed opportunities to corral tens of billions of dollars in overcharges and other billing errors tied to abuse of risk scores.

Meanwhile, the growing power of the Medicare Advantage industry has muzzled many critics in Congress, and turned others into cheerleaders for the program.”

Back to the main story: What House Speaker Paul Ryan and GOP congressional leaders are proposing is to tear down and remold basic Medicare into the troubled Medicare Advantage program, which would be like throwing kerosene on a house fire.

There’s even more of a muddle on how the GOP would calculate how much to give seniors for their yearly stipend to cover private premiums. What if policy costs go up double digits and the stipend doesn’t keep pace with the private market?

Would private insurers offer lower rates to healthier seniors and price less-healthy Americans out of the market? Although basic Medicare would still be available, wouldn’t the money diverted to premium support undermine funding for the traditional Medicare Hospital Trust Fund, which may be insolvent by 2029?

I think there’s a reason why there’s a billboard in Kenosha, Wisconsin — in the heart of Ryan’s Congressional District — that shows Ryan in a robber’s mask. There’s an attempted theft in progress, but older Americans and the disabled will be the victims.

AHCA savings, $487 billion in Medicare cuts remain in House budget proposal

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http://www.modernhealthcare.com/article/20170719/NEWS/170719888/ahca-savings-487-billion-in-medicare-cuts-remain-in-house-budget

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The House Budget Committee on Wednesday agreed to bake in hundreds of billions in Medicaid cuts from its ACA repeal bill to the budget resolution, plus an additional $114 billion in cuts over 10 years.

The committee’s Republicans’ unanimously approved the decision with no Democrats on board. The budget resolution, which is the foundation for passing tax reform in the Senate without Democratic votes, also assumes Medicare will reduce spending by $487 million from 2018 to 2027.

Some of the additional savings would come from imposing a work requirement on Medicaid adult beneficiaries who are younger than 65 and are not on Social Security disability as a condition of eligibility.

The Medicare savings are built on an idea long-favored by Republicans — using vouchers to buy insurance, though Republicans say future beneficiaries will have the option to buy traditional Medicare too. Democrats during Wednesday’s hearing complained that traditional Medicare would cost 25% more than it does now if vouchers come into play.

The Republicans also included savings that would stem from raising the Medicare eligibility age for future beneficiaries who are 51 or younger. Under the proposal, those individuals would not become eligible for full Social Security benefits or Medicare until the age of 67. The Congressional Budget Office has estimated that would reduce Medicare spending by 2% once everyone in the program is covered by the later eligibility age.

The proposal includes a requirement that affluent seniors pay higher premiums, and that people with incomes of $1 million or more pay the full cost of Medicare premiums without any federal subsidy.

Rep. Matt Gaetz, R-Fla., said during the hearing that the proposed changes are based on math rather than Tea Party politics, as some have alleged.

The Republican spending outline also assumes the government will do better at recouping or avoiding improper payments. The proposal said that there was $59.7 billion in improper Medicare payments in in the last fiscal year, and $36.3 billion in improper Medicaid payments. The outline assumes future improper payments will be 50% lower than today’s levels.

Rep. Debbie Wasserman-Schultz, D-Fla., introduced an amendment that would have changed the resolution so that it no longer assumed American Health Care Act changes would be future law, citing the Senate bill’s collapse this week.

But every Republican present on the committee voted against the amendment. “This is the official position of the House on repeal and reform efforts,” said Rep. Bill Johnson, R-Ohio.

The budget resolution also includes a reduction in health spending of $43.9 billion over 10 years, the CBO estimate of how much the malpractice reform bill that passed the House would save.

Ranking Member John Yarmuth, D-Ky., called the budget disgraceful and others called the cuts to Medicare, Medicaid and food stamps draconian, several Republicans worried what it envisions might not come to pass.

“We might fail to achieve savings in mandatory spending,” which includes Medicaid and Medicare, Johnson said, noting that the budget resolution might make it harder to pass tax reform in the Senate.

The first hurdle, however, is for the resolution to pass the entire House of Representatives.