Posts Tagged ‘Medicaid’

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Will the ACA Survive the Supreme Court, 2012 Election?

Wednesday, February 1st, 2012

The 26 states that have challenged President Barack Obamas healthcare law face several dilemmas as they try to convince the Supreme Court to declare the law’s Medicaid expansion unconstitutional   The two lower courts that heard the Medicaid challenge ruled in favor of the Obama administration, even as those judges struck down the healthcare law’s individual mandate. Legal experts on both sides of the mandate debate were surprised that the Supreme Court agreed to also hear the Medicaid piece of the state’  lawsuit.  The healthcare law’s supporters claim that the states erred in their initial brief on the Medicaid expansion, which was filed with the Supreme Court.

According to the states involved in the lawsuit. the ACA’s Medicaid expansion is “coercive.” Although state participation in the program is strictly voluntarily, the brief argues, the healthcare law makes it impossible for states to opt out of Medicaid.  The brief tries hard to link the Medicaid expansion to the individual mandate, arguing that states won’t be able to exercise their legal right to leave Medicaid because it’s the only way for Medicaid-eligible residents to fulfill the mandate.

“While the (Affordable Care Act) purports to leave states’ participation in Medicaid nominally voluntary, multiple aspects of the Act evince Congress’ keen awareness that, in fact, no state will be able to reject its new terms and withdraw from the program,” the brief says. “Most obviously, the ACA’s individual mandate requires Medicaid-eligible individuals to obtain and maintain insurance.”  But most Medicaid-eligible people would be exempt from the mandate, said Timothy Jost, a law professor at Washington and Lee University and a supporter of the health law.

Then there’s the Supreme Court case, which will be heard in the spring and a verdict announced prior to the November presidential election. According to Kurt Mainwaring, a ksl.com contributor, “Far-reaching consequences of the court’s ruling will likely impact both the cost of healthcare and the outcome of the 2012 elections.  If the Supreme Court rules that ACA is constitutional, healthcare costs will likely continue to rise — although at a slower rate than if the law were determined to be unconstitutional.  At present, healthcare costs make up approximately 18 percent of GDP. If expenditures continue on their current trajectory, “the share of GDP devoted to healthcare in the United States is projected to reach 34 percent by 2040.”  Translated to real numbers, the Department of Health and Human Services (HHS) notes that Americans paid approximately $1,000 annually in healthcare costs in 1960; more than $7,000 per year in 2007; and are projected to pay more than $13,000 per year by 2018.  This kind of increase in healthcare costs is not sustainable — and these kinds of projections are part of the reason ACA was enacted in the first place.

Beach Conger, a Vermont internist writing in the Burlington Free Press believes that “Medicare for All” — a possibility that was raised during the lengthy debate over the ACA — should be reconsidered.  According to Conger, “Medicare and I were born in the same year. Professionally speaking, that is. We were raised together, and we have been married to each other for what seems an eternity. As with any long-term relationship, we have had our ups and downs, but we have both matured over the years, and I believe we are both the better for it. Without being too vain, I have to say I have done a better job at providing health care, and I have to admit that Medicare has helped me do it.  At first, it just made sure that those retired people who wished to pay me the fees to which those in my line of work have become so accustomed, could actually do so. But eventually it realized that there was more to the business than just money, and it began to keep an eye over my shoulder, making sure I was not leaving undone those things which ought to be done and not doing those things which I ought not.  So I can’t help but think, why not Medicare for everyone? It would be so simple. And that’s when I realized.  It was too simple.”

Dr. Conge, it should be pointed out, lives in Vermont, to date the only of 50 states to enact a single-payer public option — Green Mountain Care.

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As States Create Health Insurance Exchanges, Insurers Are Benefiting from the ACA

Wednesday, January 25th, 2012

The same insurance companies that spent millions of dollars working to defeat the Patient Protection and Affordable Care Act (ACA) claiming it would raise costs and disrupt coverage, are seeing their profit margins soar to levels not seen since before the recession and are benefiting financially from the law, a Bloomberg Government study shows.

Insurers recorded their highest combined quarterly net income of the past 10 years after the law was signed in 2010, said Peter Gosselin, the study author and senior healthcare analyst for Bloomberg Government. The Standard & Poor’s 500 Managed Health-Care Index rose 36 percent in the period, four times higher than the S&P 500.  “The industry that was the loudest, most persistent critic of this law, the industry whose analysts and executives predicted it would suffer immensely because of the law, has thrived,” Gosselin said. “There is a shift to government work under way that is going to represent a fundamental change in their business model.”

Health insurers gave $86.2 million to the U.S. Chamber of Commerce to oppose the law after Obama administration officials disparaged their desire to chase profits by raising customer premiums.  America’s Health Insurance Plans (AHIP), still claims the law will increase costs and cause consumers to lose coverage.  Even so, the insurers saw their average operating profit margins expand to 8.24 percent in the six quarters since the ACA became law, compared with 6.88 percent during the previous 18 months.

One significant finding of an annual California Employer Health Benefits Survey released by the California HealthCare Foundation, a research and grant-making non-profit organization, is that in California fewer companies provided healthcare coverage for their employees last year; those that did raised premiums for coverage. According to the survey, premiums have risen 153 percent since 2002, a rate more than five times the increase in California’s inflation rate.  During the last two years alone, the proportion of state employers offering coverage to workers fell to 63 percent from 73 percent, according to the survey.

“This is a departure from previous years and could be an early sign of future changes,” the foundation report noted in commenting on data collected between July and October 2011 in interviews with 770 private firm benefit managers.

Increasing costs and shrinking coverage are speeding up, said Anthony Wright, executive director of Health Access California, a group that advocates for expanded health insurance coverage.  “They are frankly multi-decade trends,” he said. “What is notable is that this is more significant than usual.”  What’s been a “gradual erosion of employer-based coverage in good years” has evolved into “a steep one in bad years,” Wright said. “To be down to 63 percent (of California companies offering coverage) is huge.  It used to be up over 80 percent.”

There is good news, however, in the fact that 13 states have functioning health insurance exchanges, two have pending legislation to establish them, while another five are planning their exchanges. Health insurance exchanges are state-regulated standardized healthcare plans where individuals can purchase health insurance and be eligible for federal subsidies.  The remaining 30 states are moving more slowly.  For example, Pennsylvania is gradually moving toward a health insurance exchange.  “Pennsylvania has taken steps towards the establishment of an exchange, which I think is positive — there are other states that have moved more aggressively, including states whose governors are part of the lawsuit,” said Sharon Ward, director of the Pennsylvania Budget and Policy Center, a non-government organization that supports the federal health care law.  Two states — Louisiana and Arkansas — have opted out of the insurance exchange program.

Insurers are of two minds regarding the issue of insurance exchanges. Some favor the programs because they would help them to reach more consumers.  Consumer advocacy groups and insurance analysts claim that exchanges would increase competition to the industry, with the ultimate result of cutting prices nationwide.

Writing in the Green Bay Press Gazette, Jeff Mason, CEO of the BayCare Clinic, believes that, generally speaking, healthcare payments need fixing. According to Mason, “Healthcare finance is complicated even in the best of times.  Unfortunately, it isn’t the best of times.  We’re in a climactic period in healthcare when the finance mechanisms don’t work anymore.  Employers can’t continue to pay the spiraling healthcare costs.  Providers can’t continue to shift their low-reimbursement government work to employers. The government can’t expect any more free care out of providers.  Right now, our clinic collects less than half of what we charge to all of our customers in aggregate.  We collect 11 cents of every dollar we charge to Medicaid, and 13 cents of every dollar we charge to Medicare.  This is considered our “low-pay” business, and is extremely difficult to manage financially.

“This physician/hospital payment problem is a government experiment that started in the 1980s and has gone terribly wrong.  It followed the concept that a large purchaser of a service should get a better price and began discounting government payments to providers.  Medicare started by shaving a few percent, but then it got larger and larger.  All along, health care providers were shifting the shortfalls to the private employers.  At the same time, health care expense continued to grow as we obtained more expensive new medications and new technologies to improve patient treatments.”

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Some of America’s Doctors Are Going Broke

Wednesday, January 18th, 2012

Many of America’s physicians have an embarrassing secret — they are going broke. This quandary is claiming a wide range of casualties, including family physicians, cardiologists and oncologists.

Industry insiders are concerned about the trend.  Approximately 50 percent of all doctors operate a private practice. If a cash crunch forces the closure of an independent practice, it robs a community of a vital healthcare resource.  “A lot of independent practices are starting to see serious financial issues,” said Marc Lion, CEO of Lion & Company CPAs, LLC, which advises independent physician practices about their finances.  Doctors say that smaller insurance reimbursements, changing regulations, soaring business and drug costs take away from their practices’ profitability. Some experts counter that doctors’ lack of business sense shares the blame.

Recent steep 35 percent to 40 percent cuts in Medicare reimbursements for key cardiovascular services, such as stress tests and echocardiograms, have taken a substantial toll on revenue for cardiologists, as an example.  Federal law requires that Medicare reimbursement rates be adjusted every year based on a formula tied to the economy’s health. That law says rates need to be cut every year to keep Medicare financially sound.

Although Congress has blocked those cuts 13 times over the 10 years, most recently on December with a two-month temporary “patch,” this dilemma haunts doctors every year.

Beau Donegan, senior executive with a hospital cancer center in Newport Beach, CA, is well aware of physicians’ financial woes.  “Many are too proud to admit that they are on the verge of bankruptcy,” she said. “These physicians see no way out of the downward spiral of reimbursement, escalating costs of treating patients and insurance companies deciding when and how much they will pay them.

“This is a very timely and truthful story for doctors and hospitals in America. This is also a 911 call for U.S. healthcare security.  More importantly, when a doctor is ‘$3.2 million in debt’ or has to force 6,000 cancer patients to look for a new doctor”, as reported by CNN Money, “our healthcare system infrastructure earthquake is coming,” says Dr. Jin Zhou, president of ERISAclaim.com, a national expert on PPACA and ERISA appeals and compliance.  This 2012 CNN Money report is consistent with an AMA report on March 4, 2011 that 51 percent of doctors in Texas are going broke: “51 percent of Texas doctors dug into personal funds to keep practices afloat in 2010,” Dr. Zhou said.

Writing in Forbes, Rick Ungar counters that “While there is considerable truth to be found in the CNN Money piece, a deeper analysis is in order given the knee-jerk reaction by the many who are too quick to place the problem and the blame at the feet of the federal government.  First off, it is important to recognize that not all physicians in the healthcare system are facing financial crisis. About 50 percent of the nation’s doctors are employed, typically by hospitals, and receive a salary in exchange for their service. So far, these practitioners do not appear to be in any significant financial danger.”

The financial problems are typically experienced by a portion of the remaining 50 percent who wish to operate their own private practices and, as a result, find themselves suffering from the financial stresses faced by so many small businesses in these difficult times.  Yet, even among this 50 percent, not all private practices areas are in trouble. For example, surgeons and dermatologists seem to be doing just fine while cardiologists and oncologists, whose business models necessarily make them more susceptible to trouble, are feeling the pain.

Why oncology and cardiology?

Part of the blame does rest with changes in Medicare and Medicaid payment policies. Certainly, cardiologists and oncologists, whose practices naturally bring them into contact with more senior citizens, are the most likely to feel the pain when it comes to reduced government payments. Last year, the Centers for Medicare & Medicaid Services (CMS) took a hatchet to what is paid to cardiologists for performing important tests such as echocardiograms, stress tests and other “machine” based testing. But what you may not know is that these reductions were based on a survey conducted by the American Medical Association, at the request of the CMS, that seemed to go out of its way to omit cardiologists in private practice from the survey participants. Why? Because private practice cardiologists have, by and large, dropped out of the AMA and the AMA’s interest was in getting more money set aside for those medical practitioners in other areas of medicine who remain members.

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Medicare Times Are a Changing

Monday, January 16th, 2012

Baby boomers may not like it — and whoever wins the White House this year — but the Medicare that our parents knew and love is destined to change. And it’ll be like it or lump it.

With more than 1.5 million baby boomers enrolling in Medicare every year, the program’s future is one of the most crucial economic issues for anyone who currently is 50 or older. Healthcare costs are the most erratic part of retirement expenses, and Medicare remains a great deal for retirees, who often get benefits worth significantly more than the payroll taxes they paid while working.  “People would like to have what they used to have.  What they don’t seem to understand is that it’s already changed,” said Gail Wilensky, a former Medicare administrator. “Medicare as we have known it is not part of our future.”

Consider these numbers.  Medicare’s giant trust fund for inpatient care is expected to run out of money in 2024.  When that happens, the program will collect only enough payroll taxes to pay 90 percent of benefits.  Additionally, researchers estimate that as much as one-fifth and even two-thirds of the more than $500 billion that Medicare now spends every year is spent on treatments and procedures of little or no benefit to patients.

Representative Paul Ryan (R-WI), chairman of the House Finance Committee, is leading the charge on changing Medicare.  Ryan’s current proposals will not impact people now 55 or older would not have to make any changes.  But how would it work?  Would it save taxpayers’ dollars?  Would it shift costs to retirees, who are least able to afford it?   Will Congress ultimately end traditional Medicare?  These questions are still waiting for answers.  “I’m not sure anybody has come up with a formula on this that makes people comfortable,” said health economist Marilyn Moon, who formerly served as a trustee overseeing Medicare finances.

The White House’s preference is to keep the existing structure of Medicare while “twisting the dials” to control spending, said Medicare trustee, economist Robert Reischauer of the Urban Institute think tank.

Ryan’s original approach would have put 100 percent of future retirees into private insurance.  His most recent plan, written with Senator Ron Wyden (D-OR), would keep traditional Medicare as an option, competing with private plans.

Writing for AARP, Ricardo Alonzo Zaldiver says that, “This could mean more Medicare recipients joining private insurance plans (currently, only about 25 percent of Medicare recipients are in private ‘Medicare Advantage” plans, while the other three-quarters participate in the traditional, government-run Medicare program).  A new voucher-for-private-Medicare plan would be available to anyone currently under 55.

“It could also mean keeping the existing Medicare structure but making certain tweaks to control spending.  Under President Obama’s healthcare overhaul, the Independent Payment Advisory Board could force Medicare cuts to service providers if costs rise above certain levels and Congress fails to act.  Obama has said he’ll veto any plan to cut Medicare benefits without raising taxes on the wealthy.  During failed budget negotiations last summer, he indicated a willingness to gradually raise the Medicare eligibility age to 67, revamp co-payments and deductibles in ways that would raise costs for retirees, and cut payments to drug makers.  ‘For the 76 million baby boomers signing up over the next couple of decades, it will pay to be watching.’”  President Obama has promised that he will veto any plan to cut Medicare benefits without raising taxes on the wealthy.

The Chicago Sun-Times offers this sage advice: “Fix Medicare, ignore scare talk.”  According to writer Steve Huntley, “I’ve contributed to Medicare every year of its existence. Yet, it’s a myth that seniors have paid the costs of their Medicare services, as demonstrated by the research of economists Eugene Steuerle and Stephanie Rennane of the Urban Institute think tank.  Their study showed that a two-income couple earning $89,000 a year would pay $114,000 in Medicare taxes during their careers but could expect to receive $355,000 in medical care in retirement. They could get prescriptions, doctor visits and hospital services valued at three times their contribution to Medicare.

“Medicare combined with Medicaid and Social Security add up to an entitlement time bomb –  they’ll consume all tax revenues by 2052, according to a Heritage Foundation analysis –  for the people who’ll be stuck with the bill: working Americans.  In 1950, there were 16 taxpaying workers for each retiree; by the time the baby boomers all retire, there will be two workers for each retiree. Entitlement reform has to happen.”

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States Rewarded for Adding Kids to Public Insurance Rolls

Monday, January 9th, 2012

Twenty-three states will share $296.5 million in federal funds for encouraging low-income families to enroll children in state-run public healthcare programs.  The bonuses reward states that streamlined eligibility for Medicaid, the federal-state health program and the Children’s Health Insurance Program (CHIP).  The goal is to assure coverage for children younger than 19 from households with annual incomes of less than $45,000 for a family of four, though some states are more generous.  Despite 2011’s shaky economy, the number of uninsured children fell to 5.9 million in 2010 from 6.9 million the previous year, according to a study by the Georgetown University Health Policy Institute.  Children still leave the program rolls because parents neglect to renew eligibility, increasing the likelihood of missed vaccinations and dental checkups, said Tricia Brooks, a senior fellow at the Georgetown institute.

“Families may avoid routine preventive care with the hope they’ll have more money next month or delay seeking care until they know they really have to bring the children in,” Brooks said.  “At that point, the emergency room is a likely choice.”

Besides the 1.2 million newly insured children, three million who previously had private insurance transferred to CHIP or Medicaid during that time frame, said Sherry Glied, assistant secretary for planning and evaluation at the Department of Health and Human Services (HHS).  Because of that, children have been protected from 10 years of erosion of health insurance among Americans that resulted as employers dropped coverage, workers with insurance were laid off because of the recession, and people whose only alternative was to buy insurance on their own could not afford to do so.  Since CHIP was first established in 1997, the share of adults ages 26 to 64 with a health plan dipped from 83 percent to 80 percent. By contrast, in the same period, the share of children with insurance grew from 86 percent to 93 percent.  “It’s very encouraging, because it shows that even in an economic downturn, CHIP really made a difference,” Glied said.

The 23 states that are eligible to receive performance bonuses are: Alabama, Alaska, Colorado, Connecticut, Georgia, Idaho, Illinois, Iowa, Kansas, Louisiana, Maryland, Michigan, Montana, New Jersey, New Mexico, North Carolina, North Dakota, Ohio, Oregon, South Carolina, Virginia, Washington, and Wisconsin.

To earn their bonuses, states used electronic databases rather than paperwork submissions from families to verify incomes or preemptively enrolling kids who appear to be eligible.  Additionally, states may guarantee one year of eligibility rather than requiring periodic renewals.  Georgia and South Carolina use information from their nutrition assistance programs to hasten eligibility determinations, said Marilyn Tavenner, acting administrator of the U.S. Centers for Medicare and Medicaid Services.  In 2010, 15 states claimed bonuses totaling approximately $206 million.  Alabama, which received $55 million after adding 133,000 children to its public insurance programs, led the pack.

In Connecticut, for example, an estimated 49,000 Connecticut children under 18 have no health insurance, said Mary Alice Lee, senior policy fellow with Connecticut Voices for Children.  The state provides affordable insurance for children under the Husky Health program. According to Lee, considering that the state’s economic downturn and the 2010 nine percent unemployment rate, the fact that the percentage of uninsured children held steady means that the Husky program is working.  “The number of uninsured children in Connecticut is really relatively low compared to other states,” Lee said.  On a national basis, 9.8 percent of children under 18 were uninsured in 2010.  “The Husky program is doing exactly what it’s supposed to do, that is, provide affordable coverage for children during times of economic stress.”

No parent in America should have to think twice about taking their child to a doctor’s appointment or filling a prescription for their child because the cost is too high,” Tavenner said. “And no child should have to miss school or activities because they’re not getting the care they need to stay healthy.”  States have wide latitude regarding how they spend the funds, but the intent is that they will be used to help defray the shared Medicaid costs that the states incur by enrolling more children.

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ACA Is Fixing U.S. Healthcare Delivery: Donald Berwick

Wednesday, January 4th, 2012

Dr. Donald Berwick, who oversaw Medicare and Medicaid until recently said the programs are trapped in a health system that promotes wasteful spending and inefficient care. “Healthcare is broken,” Berwick, who headed the Centers for Medicare and Medicaid Services (CMS), said.  “We have set up a delivery system that is fragmented, unsafe, not patient-centered, full of waste and unreliable.  Despite the best efforts of the workforce, we built it wrong. It isn’t built for modern times.”  Berwick said the Patient Protection and Affordable Care Act (ACA) is changing how physicians and hospitals are paid and deliver care through such innovative arrangements as accountable care organizations (ACOs), which improve coordination and lower costs.”

According to Berwick, it is not clear whether these efforts will produce results quickly enough to silence the critics who want to make more radical changes that would shift the majority of the burden onto beneficiaries.  “That is the central question, the nub…whether that will happen fast enough, I just don’t know.”

To read the full transcript of Berwick’s remarks, click this link:

Berwick defended his tenure as CMS administrator. Even though he failed to win Senate confirmation, that did not impact his ability to get things done, though he would have preferred a longer term.  “An agency of this size will do better with longer-term leadership commitment,” he said.  With the knowledge that his tenure was likely to be short, Berwick felt a greater sense of urgency to achieve things.  Berwick’s most challenging decisions involved state requests to cut Medicaid benefits and writing regulations to encourage doctors and hospitals to form ACOs, while not making the requirements overly burdensome.

Berwick took exception to state’s efforts to limit hospital coverage for Medicaid recipients, which is presently under review by federal regulators.  Hawaii has proposed a 10-day limit on some enrollees; Arizona has proposed a 25 day limit.  “It’s a nonsensical idea.  If a patient needs 20 days, the patient should get 20 days,” he said.

According to the Bangor Daily News, Berwick’s departure from CMS is “an unnecessary loss.” Berwick’s parting words should help Americans understand how their health system is in the process of being improved.  The article notes that “Waste is a broad term, including needless medical procedures, failure of adequate preventive measures, duplication and inefficiency, as well as outright fraud.  Hospital-acquired infections have caused the deaths of almost 100,000 Americans each year and the illness of millions more, according to the U.S. Centers for Disease Control and Prevention.  Dr. Berwick has reported that these complications have added as much as $45 billion a year to hospital costs borne by taxpayers, insurers and customers.  He said that some hospitals have virtually eliminated some infections that other hospitals still consider inevitable.  Under the Affordable Care Act, sometimes called Obamacare, financial incentives will go to hospitals that excel in fighting these infections starting in 2015.

Unnecessary hospital readmissions add another $12 billion a year, estimates the Medicare Payment Advisory Commission.  It says half or more of these readmissions could be prevented through better coordination and patient education, permitting them to recover at home rather than re-entering the hospital with complications.  ‘Integrated care’ will also reduce costs, said Dr. Berwick, by protecting patients from having to tell their stories over and over to different providers and letting a doctor know what medication they had already been given.  No figure is available for the savings from automated record keeping, but it is becoming substantial.  Preventive medicine is already reducing waste, for example by detecting diseases at early stages for prompt treatment.  The Affordable Care Act makes preventive benefits like cholesterol tests, mammograms and screening for colon and rectal cancer free for everyone with Medicare.”

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ACA Gives 2.5 Million Young Adults Healthcare Coverage

Tuesday, December 27th, 2011

The number of young adults who have no medical coverage has contracted by 2.5 million since the Patient Protection and Affordable Care Act (ACA) took effect, according to a new analysis by the Obama administration.  That decline is 2½ times larger than earlier government and private estimates, which showed about one million Americans ages 19 – 25 had acquired coverage.

Obama administration officials said they now have more comprehensive data and are slicing the numbers more precisely than the government typically does, in an attempt to identify the impact of a popular provision in the law.  Thanks to the ACA, young adults can remain on their parents’ health insurance plans until their 26th birthdays.  Families have flocked to sign up their offspring, making the transition to work in a challenging economic environment a bit easier.

“Thanks to the Affordable Care Act, 2.5 million more young adults don’t have to live with the fear and uncertainty of going without health insurance,” said HHS Secretary Kathleen Sebelius.  “Moms and dads around the country can breathe a little easier knowing their children are covered.”

“This comparison makes it clear that the increase in coverage among 19 to 25 year-olds can be directly attributed to the Affordable Care Act’s new dependent-coverage provision,” according to an Assistant Secretary for Planning and Evaluation (ASPE) brief.  “Furthermore, the coverage gain for young adults was entirely due to an increase in private coverage (from 49 percent to 58 percent), with no change in Medicaid coverage during this period.”

“The increase in coverage among 19- to 25-year-olds can be directly attributed to the Affordable Care Act’s new dependent coverage provision,” according to the Department of Health and Human Services (HHS).  “Initial gains from this policy have continued to grow as…students graduate from high school and college.”

That age group previously recorded the highest uninsured rate. Now, 26- to 35-year-olds have that dubious distinction by a narrow margin, according to the Centers for Disease Control and Prevention.

According to the HHS survey, nearly 36 percent of Americans ages 19 – 25 — more than 10.5 million people — were uninsured in the third quarter of 2010, before the law’s provision took effect.  The majority of employer-based health plans began carrying the provision January 1, 2011.  By the 2nd quarter of 2011, the proportion of uninsured young adults had fallen to slightly more than 27 percent, or about eight million people.

And just who are these young adults?  Some are transitioning from school to work. Others are trying to start their careers by working at low-wage jobs that don’t usually come with healthcare coverage.  Some – known as the “invincibles” – pass up job-based health insurance because they don’t think they’ll need it and prefer some extra money in their paychecks.

Similarly, the National Center for Health Statistics has documented a broadly similar trend, only not nearly as spectacular.  According to administration officials, those statistics do not focus on the change from calendar quarter to calendar quarter, as the new HHS report does.  Instead, they pool data over longer time periods; that tends to dilute the law’s perceived impact.

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Berwick Laments Washington, D.C., Cynicism About ACA

Tuesday, December 20th, 2011

Dr. Donald Berwick, who recently left his job as administrator of the Centers for Medicare and Medicaid Services (CMS) because the Senate refused to confirm his nomination, struck back at his critics who had accused the pediatrician of advocating healthcare rationing.

“The true rationers are those who impede improvement, who stand in the way of change, and who thereby force choices that we can avoid through better care,” Berwick said.  “It boggles my mind that the same people who cry ‘foul’ about rationing an instant later argue to reduce healthcare benefits for the needy, to defund crucial programs of care and prevention, and to shift thousands of dollars of annual costs to people — elders, the poor, the disabled – who are least able to bear them.”

Although Berwick didn’t specifically accuse Senate Republicans, it was clear that he was referring to proposals to drastically slash the nation’s budget deficit by capping federal funding to states for Medicaid.  That proposal could cut billions of dollars that critics have said would lead to cuts in benefits.

During his 16-month tenure at CMS, Berwick studiously avoided using the term “rationing”.  Now, the gloves have come off.  “When the 17 million American children who live in poverty cannot get the immunizations and blood tests they need, that is rationing.  When disabled Americans lack the help to keep them out of institutions and in their homes and living independently, that is rationing.  When tens of thousands of Medicaid beneficiaries are thrown out of coverage, and when millions of seniors are threatened with the withdrawal of preventive care or cannot afford their medications, and when every single one of us lives under the sword of Damocles that, if we get sick, we lose health insurance, that is rationing.”

Berwick also jabbed at those who inaccurately said the Patient Protection and Affordable Care Act (ACA) included so-called “death panels.”  According to Berwick, “If you really want to talk about ‘death panels,’ let’s think about what happens if we cut back programs of needed, life-saving care for Medicaid beneficiaries and other poor people in America.  Maybe a real death panel is a group of people who tell healthcare insurers that is it OK to take insurance away from people because they are sick or are at risk for becoming sick.”

Going even further, Berwick said that the ACA needs more advocates supporting the law. “The law is just a framework,” Berwick said.  “Healthcare in America can improve and it can become sustainable without a tremendous amount of community involvement.”  President Obama has an important role in this, as do healthcare consumers who must push healthcare leaders to rethink the way they work.  “Increasingly, though, that advocacy role is falling to physicians, nurses, and hospital executives.  We need their voices, because they know the system can’t go on the way it is,” he said.

“I think that a lot of the public concern about that law and a lot of the congressional criticism is ill-founded and based on myths,’’ Berwick said.  “I think any chance to air publicly, with conversation and even debate, matters of such concern is healthy.’’

While contemplating what to do next in his career, Berwick said “I’m excited by how much is in motion in healthcare right now.  It’s an incredibly interesting and promising time with many risks, and I want to stay thoroughly engaged in reshaping American healthcare into the high-performance, sustainable system I know it can be.”

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Super Committee’s Failure Raises Questions About Healthcare Funding

Wednesday, December 7th, 2011

Now that the Super Committee has failed to identify $1.2 trillion in cuts from the federal budget, automatic cuts totaling billions for everything from Medicare to biomedical research, start in 2013.  Some healthcare sectors will fare better than others.  The primary health entitlement programs, Medicare and Medicaid, are protected under the law that created the Super Committee.  Automatic cuts will not impact Medicaid, the joint federal-state health program for the poor.  Medicare would be cut by two percent – all from payments to hospitals and other providers.

The bad news is that unless Congress reworks the legislation mandating the automatic cuts, a series of across-the-board reductions will begin in 2013.  The House and Senate appropriations committees must decide how to spread the cuts among various programs.  And some of the larger, better-financed lobbies may be able to influence what is cut and what is kept.

Even though the Medicare cuts are limited to hospitals and other medical providers and would not exceed two percent, they argue that is too much and that they sacrificed plenty in the Patient Protection and Affordable Care Act (ACA).  Rich Umbdenstock, president and CEO of the American Hospital Association, said sweeping cuts would hurt Medicare beneficiaries and their families and “also have an impact on the ability of hospitals to provide essential public services to the communities they serve given the impact that Medicare has on the entire healthcare system.”

Officially known as the Joint Select Committee on Deficit Reduction, the Super Committee was unable to meet its deadline to come up with $1.2 trillion of deficit reduction required by the law that created it, much less the $4 trillion that deficit hawks said was necessary to stabilize the finances of the U.S. government, whose debt has topped $15 trillion.  The failure ensures that the fiscal debate between Democrats who want to protect social programs and increase revenue by raising taxes on the wealthy; and Republicans who want smaller government and have pledged to reject tax increases will be a fundamental choice confronting voters in 2012.

“After months of hard work and intense deliberations, we have come to the conclusion today that it will not be possible to make any bipartisan agreement available to the public before the committee’s deadline,” Representative Jeb Hensarling,(R-TX), and Senator Patty Murray, (D-WA) said.  The co-chairs thanked committee members, staffers and “the American people for sharing thoughts and ideas and for providing support and good will as we worked to accomplish this difficult task.”

Writing for Politico, David Nather speculates on whether the Super Committee’s failure has harmed efforts to reform Medicare and Medicaid.  It would be easy to conclude that the Super Committee’s failure means the big, expensive health care entitlement programs — Medicare and Medicaid — are untouchable.  It also would be wrong.  The timing was off, coming too close to a presidential election.  The co-chairs weren’t powerful enough.  The work came too soon after a summer debt deal that Democrats hated.  Republicans couldn’t give the kind of concessions on taxes that Democrats needed.  And the alternative to a Super Committee deal on healthcare entitlements — the two percent automatic cuts in healthcare payments and defense funding that will now take place in 2013 — wasn’t harsh enough to force a deal on Medicare and Medicaid. In fact, it might even have been the easier way out.  All of which means Medicare and Medicaid are not off the table forever.”

The Hill’s Sam Baker offers a different perspective. “The Super Committee’s demise is a mixed bag for the American Medical Association and other groups that wanted the 12-member panel to tackle Medicare’s payment formula, known as the sustainable growth rate (SGR).  The AMA — with bipartisan support in Congress — pushed hard for the supercommittee to include in its deficit-cutting package a long-term fix to the SGR.  The formula calls for automatic annual cuts in doctors’ payments, which add up as Congress consistently delays each cut from taking effect.  Aspirations of a long-term SGR patch should be put to rest, healthcare lobbyists said. But they questioned whether the supercommittee push was ever realistic, because an SGR fix would add to the deficit.”

“I never once believed that the Joint Select Committee would be the one to do that,” said Julius Hobson, a senior adviser at the Washington, D.C.-based law firm Polsinelli Shughart and a former AMA official.

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Can Marilyn Tavenner Save Medicare?

Monday, December 5th, 2011

President Barack Obama’s choice of Marilyn Tavenner as administrator of the Centers for Medicare and Medicaid Services – to replace Dr. Donald Berwick, whose recess appointment was set to expire at the end of the year – is more likely to survive the Senate confirmation process relatively unscathed.

A Harvard-educated pediatrician, Berwick won praise and the backing of major healthcare groups for his academic work, which focused on cutting the cost of care while improving quality and patient experience.  Republicans took exception to his praise of Britain’s National Health Service as an “example” for the United States to emulate.  Others accused him of supporting “rationing” healthcare services, a claim Berwick rejects.  “Every bone in my body, as a physician, even as a person, is to get everything (patients) want and need and to help them at every step,” he said.  “I have gone to the mat to get a last-ditch bone marrow transplant for a child with leukemia…and they are telling me I’m rationing?  They haven’t met me.”

White House officials said, “Before entering government services, Tavenner spent nearly 35 years working with health care providers in significantly increasing levels of responsibility, including almost 20 years in nursing, three years as a hospital CEO, and 10 years in various senior executive-level positions for Hospital Corporation of America.”

According to Ezra Klein, “Tavenner’s healthcare experience lies much more in management than policy.  Former colleagues describe her as a patient-centered manager, a hands-on medical professional equally comfortable in the board room and the emergency room.  And in contrast to Berwick, Tavenner isn’t associated with a grand vision for health reform, or a particular policy agenda for Medicare and Medicaid.  ‘With Marilyn, you present the information, then she makes a decision, and you move on,’ said Patrick Finnerty, who served as Virginia’s Medicaid director under Tavenner.  ‘She doesn’t make promises she can’t keep.  There are differences of opinions, and she would try to work through those.  She’s straight with folks but always respectful.’”

Tavenner started her career as a nurse at Virginia hospitals owned by the Hospital Corporation of America (HCA).  Tavenner met with success, rising from chief nursing officer to CEO.  In 2004, she was again promoted to HCA’s president of outpatient services, her first national position with the firm.  She resigned two years later, when then-Virginia Governor Tim Kaine tapped her to head the state’s Health and Human Resources department.

Tavenner has already won the American Medical Association’s (AMA) backing. “We have worked extensively with her in her role as deputy administrator, and she has been fair, knowledgeable and open to dialogue,” AMA President Peter Carmel said.  “With all the changes and challenges facing the Medicare and Medicaid programs, CMS needs stable leadership, and Marilyn Tavenner has the skills and experience to provide it.”

Senator Orrin Hatch (R-UT), the ranking Republican on the Senate Finance Committee, said that the panel would thoroughly scrutinize Tavenner, but did not say he opposes her nomination.  Despite Hatch’s mild comment, Tavenner is expected to face some difficult questioning because Senate Republicans have not overtly endorsed her.  According to a Republican healthcare lobbyist, “I can’t imagine a lot of support for her,” noting that the high-profile CMS role “always gets sucked into the controversy of the day.”  Ultimately, Tavenner is likely to be confirmed for the CMS post.

Tavenner is widely seen as a pragmatic administrator who will not rock the CMS boat. “The only way to stabilize costs without cutting benefits or provider fees is to improve care to those with the highest health care costs,” she said.  Tavenner also said she opposed Republican efforts to turn Medicaid into a block grant that would limit the amount of federal funding states can receive for the program.  “That approach would simply dump the problem on states and force them to dump patients, benefits or make provider cuts or all the above,” she said.  Tavenner “brings continuity in terms of implementing the mission,” said Len Nichols, director of George Mason University’s Center for Health Policy Research and Ethics.

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