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Study asserts insurance marketplaces are healthy


For Kaiser Health News

Despite dire warnings from Republicans and some large insurers about the stability of the Affordable Care Act exchanges, an Obama administration report released Aug. 11 indicated that the individual health insurance market has steadily added healthier and lower-risk consumers.

Medical costs per enrollee in the exchanges in 2015 were unchanged compared with 2014, according to the Centers for Medicare & Medicaid Services. In contrast, per-member health costs rose between 3 percent and 6 percent in the broader U.S. insurance market, which includes 154 million people who get coverage through their employer and the 55 million people on Medicare, the report said.

Aviva Aron-Dine, senior counselor to U.S. Health and Human Services Secretary Sylvia Burwell, said the data was encouraging when many insurers have announced double-digit rate increases for 2017 and others have pulled back in some states to curtail financial losses.

“What we take from this is that the marketplace is on sound footing,” she said in a phone briefing with reporters. She also said the sharp 2017 rate increases could be intended to help insurers compensate for underpricing their premiums in 2014 and 2015 and not the first in a series of large annual rate hikes. Next year’s phase-out of the Affordable Care Act’s reinsurance programs — which helped insurers cover losses on higher-cost enrollees the past two years — is another reason why some insurers want higher rates for 2017.

Nearly 13 million Americans bought coverage for 2016 on the Obamacare marketplaces. More than 80 percent received federal subsidies that help them afford policies and insulate them from effects of premium increases.

Several insurers, including UnitedHealth Group and Humana, have said they will not sell 2017 individual plans on many state exchanges because they absorbed heavier-than-expected losses in part due to higher medical claims.

Aron-Dine said the administration always expected that rising enrollments would attract younger and healthier enrollees to balance the risk of insuring the older and sicker people who signed up initially. In 10 states with the highest enrollment growth from 2014 to 2015, the government reported, per-member per-month claims costs fell by an average of 5 percent.

Its study was based on claims data collected by CMS to administer the health law’s reinsurance and risk adjustment programs. Insurers submitted their 2015 data earlier this year.

What explains insurers’ losses from Obamacare if health costs have held steady?

Sabrina Corlette, research professor at the Center on Health Insurance Reforms at Georgetown University’s Health Policy Institute, said some insurers priced their coverage too low in 2014 and 2015 — in part to grab market share — and are now trying to make up for it. She said insurers have based most of their 2017 rate increases on their 2015 results.

“This should reassure people that despite the narrative that these markets are going down the toilet, in fact the report shows the opposite … that these markets are generally performing pretty well,” Corlette said.

Cynthia Cox, associate director for the Kaiser Family Foundation Program for the Study of Health Reform and Private Insurance, said the CMS report is good news for consumers. “This suggests the premium increases that we are seeing going into 2017 is likely to be a one-time adjustment … for pricing too low in the first few years,” she said. (Kaiser Health News is an editorially independent program of the foundation.)

Burwell calls Fort Dodge, Iowa, community-health model


Downtown Fort Dodge.

Sylvia Burwell, the U.S. secretary of health and human services, has hailed Fort Dodge, Iowa (pop. 25,000), as a model for improving community health.

That’s in large part because Fort Dodge’s branch of the Des Moines, Iowa-based UnityPoint Health System also hosts one of the first Accountable Care Organizations in the country. The ACO work that healthcare providers have done in Fort Dodge makes it one of the nation’s best examples of how to improve health while curbing costs.

The Des Moines Register reports that Ms. Burwell visited Fort Dodge on July 14 to hear local physicians, nurses and patients about successes in healthcare. “We know that folks are depending on us to make more progress on affordability and on quality. I’m here to visit today one of the great models of people accelerating the change that the rest of the nation needs to do,” the paper reported.

The Register said  that  Fort Dodge’s ACO is particularly  unusual among other early ones because it has  at least broken even financially. Ms. Burwell cited the  collaboration among healthcare providers and a range of community agencies for the success.

For the full article from The Register, please hit this link.

Burwell: ACA focus will be on quality, not quantity


U.S. Health and Human Services Secretary Sylvia Burwell says that the Obama administration will focus on improving quality over quantity in the nation’s healthcare system in the ongoing implementation  of the Affordable Care Act.

As part of this, she says,  the administration plans  to push further on a patient-centered approach.

“Our vision is paying providers for what works, and incentivizes quality over quantity.”

She also emphasized the importance that the administration puts on enlisting states that do not currently accept federal funds for for the Affordable Care Act’s Medicaid expansion. With the recent Supreme Court ruling on ACA subsidies, it seems likely that all or most of the states now refusing to expand Medicaid will do so within the next year or so.



HHS chief looks at future of ACA

By Mary Agnes Carey, for Kaiser Health News


Could she believe what she heard?

Sitting in her office Thursday morning, Health and Human Services Secretary Sylvia Burwell saw on her computer screen that the Supreme Court was about to announce its ruling on a challenge that could cripple the Affordable Care Act. “You knew this was it,” she said.

As she rushed down the hall to a conference room where her team was waiting, Burwell heard a cheer. “And that’s the moment that I knew” the justices had upheld the law’s subsidies helping more than 6 million people purchase health insurance, she recalled.

“I’m like, ‘Are we sure?’ ” she said. “Of course everyone was reading through quickly and following it at that point.”

But, she added, it was more than just a legal victory. “It was very emotional because I met all those people,” Burwell said, visibly moved as she described her reaction to the ruling. “When you meet all these individuals [who have benefited from the health law], it really does touch you in terms of what it means. … You couldn’t help your kids, or you couldn’t take care of your parents, and that’s what these people face.”

During the past few months, Burwell had insisted there was no “Plan B” if the court were to strike the subsidies. With the court’s ruling in place, an insurance “death spiral” — where only sick people stay in the health law’s online marketplaces, or exchanges and healthier individuals drop out — has been averted. But Burwell acknowledges there are many challenges ahead.

Enrollment needs to continue to grow and those who get coverage need to better understand their benefits, Burwell said Friday in a briefing with reporters. Her agency must continue to work with governors to find middle ground that will help them accept the law’s Medicaid expansion. People with employer-based insurance must understand how the law benefits them – for example, adult children up to age 26 can stay on their parent’s health insurance plan and no out-of-pocket payments are required for preventive care.

The law’s tools to improve the way healthcare is delivered or to help detect waste, fraud and abuse in federal healthcare programs must be better understood, Burwell said.

While it’s clear that President  Obama will reject some proposed changes to the law, such as a repeal of its requirement that most Americans purchase coverage or the House-passed legislation to repeal the law’s medical device tax, Burwell said the administration is open to ideas that improve affordability, access and quality. “We have work to do. This [law] can be better,” she said.

Implementing a law as sweeping and as complicated as the Affordable Care Act will continue to occupy much of Burwell’s time in the less than two years left in her tenure (or, as Burwell reminds you, 1 year, 6 months and 23 days). And, as she says, “there will always be more to do.”

Funding cliff for health centers; CMG at a FQHC


See the news below on the federal funding cliff for community health centers. Below it is an article on Cambridge Management Group’s successful engagement at  a  Federally Qualified Health Center in Massachusetts that had been in crisis.

From the National Association of Community Health Centers Web site:

”Health and Human Services (HHS) Secretary Sylvia Mathews Burwell on Feb. 26 warned a House panel that unless addressed this year by Congress, the health center funding cliff will lead to more than 7 million patients losing access to care and 40,000 jobs lost with over 2,000 health center site closures.”

”Burwell’s testimony before the Subcommittee on Health focused on 2016 HHS Budget Request, which requests funding for, among other programs, Community Health Centers and the National Health Service Corps (NHSC) – two key healthcare programs that ensure people in underserved communities have life-saving primary and preventive care when and where they need it.”


Here’s the article on Cambridge Management Group’s successful work to help turn around a large Federally Qualified Health Center — Community Health Connections, based in Fitchburg, Mass:


CMG helps turn around CHC

By Yvonne C. Acquafredda, MBA, and Lillian J. LeBlanc, MBA

Today’s healthcare organizations face increased pressure to deliver high-quality and cost-effective care. A key element in enabling them to do this is creating work environments that encourage teamwork on all levels, from board members to all employees.

The Great Place to Work Institute, which studies organizations around the globe, notes the importance of collaboration in the workplace. Great enterprises of all sizes structure their operations to encourage employee cooperation to achieve their organizations’ goals.

Fitchburg, Mass.-based Community Health Connections (CHC), a system of outpatient clinics providing medical, dental and behavioral-health services to thousands of mostly low-income residents in 20 communities, achieved an operational turnaround through a new focus on cross-functional cooperation and clearer and more consistent management.

This was accomplished in partnership with the healthcare-sector consultancy Cambridge Management Group (CMG) and the executive-search firm ZurickDavis (ZD).

CHC is a Federally Qualified Health Center (FQHC). With changing demographics and healthcare reform, such institutions play an increasingly important role in the U.S. healthcare sector. CHC’s experience has lessons for a wide range of healthcare and other organizations across America.

Established just 10 years ago, CHC grew rapidly as it responded to urgent needs to provide primary care in north-central Massachusetts. As patient volume increased, clinicians and administrators worked diligently to meet the demand. But CHC’s organizational structure and culture acted as barriers to examining and improving business processes even as clinical demands surged. By 2013, CHC found itself near receivership. As CHC board member Gregg Buckman put it, “the financial issues were staggering.” In addition, employee morale fell to an all-time low.

Would CHC collapse in the face of the demands being put on it?

Cambridge Management Group Transforms the Organization

Fortunately, CHC’s forward-thinking board recognized the broad range of issues facing the organization and contacted CMG to find ways to stop the losses and then stabilize, focus and grow the organization.

Crucial parts of the engagement that followed were to emphasize collaboration at all levels and to clarify the institution’s needs and goals.

CMG typically operates as a partner of management, providing guidance, expertise and best practices learned over the company’s three decades. As Lia Spiliotes, a CMG partner and senior adviser, explained: “We don’t do what you do; we help you do what you do better.”

However, due to the depth of the challenges at CHC, the board and CMG agreed that interim leadership was needed. Thus Ms. Spiliotes became interim CEO and her CMG colleague Kevin Ward interim CFO.

CMG brought its corporate philosophy of servant leadership to CHC, emphasizing executive approachability and openness without all the traditional boundaries of organizational hierarchy. For example, before CMG’s arrival, CHC executive offices were in an area of CHC headquarters removed from most employees and patients. The interim leadership team established its base in a former gift shop called “The Fishbowl,” in the middle of CHC’s main building. All employees were welcomed to come by.

Another example of this approach was that Ms. Spiliotes invited CHC billing people to meet with the interim leadership team, to give the latter perspective on CHC’s billing processes and present ideas for improvement.

In the initial meetings, all employees were quiet, seemingly afraid to speak up. But over time, as staffers observed, and regularly interacted with, the interim leaders, candid discussion helped to reveal several core operational challenges. One, identified by the billing team, was a communication breakdown between the clinical and billing departments, resulting in many claims being denied. Absent cross-functional teams, the communication changes needed to capture lost revenue would never have been identified.

Over the months of CMG’s leadership, through regular communication and increased collaboration, employees identified many administrative, financial and clinical concerns. Workable solutions were designed in response as the newly collaborative process led employees to feel more empowered, energized and invested in CHC’s success.

ZurickDavis Leverages Collaboration for the CEO Search

As a new culture took hold, the CHC board turned considerable attention to recruiting a long-term leadership team. Sustaining CHC’s turnaround would require leaders with the same understanding of servant leadership that CMG brought, able to relate to employees at all levels and willing to invest the skills, time and energy needed to support organization-wide collaboration to achieve operational success.

So CHC’s board reached out to a trusted business partner, the executive-search firm ZurickDavis. CMG and ZD had been familiar with each other’s work for years.

In the spirit of collaboration, so much a hallmark of the CMG-ZD engagement, the latter’s staff invested considerable time to understand the needs of the organization, including requirements for new leadership. ZD went beyond standard job descriptions and the conventional executive-search process; it approached the engagement with few assumptions. It intensely interviewed several CHC board members and the interim leadership team, letting ZD come to fully understand the organization’s evolution and needs.

Armed with this information, ZD developed a profile of the ideal CEO to maintain CHC’s momentum. Through careful listening to the stakeholders, ZD recognized that certain qualities of character would be even more important than very job-specific skills. The new leader must be someone “committed to serve, unpretentious and genuine,” ZD found. He or she should possess a “naturally respectful, consultative, collaborative and accessible leadership style,” but also show “a willingness to lead decisively, to energize and inspire.”

ZD was a full partner throughout the process. According to ZurickDavis’s Ellen Mahoney, who worked closely in the search, steady openness and collaboration informed the whole process. “Everyone was transparent. We were a part of all meetings and fully utilized as a resource.”

Jeff Zegas, ZD’s chief executive officer, said that this level of cooperation and candor, especially in hiring a new leader, is crucial to any organization wishing to strengthen its culture and thus achieve and maintain operational success over the long term.

Building a Collaborative Organization: The ROI

Although CHC’s transformation is still a work in progress, outcomes show the positive impact of the CMG-ZD engagement. CHC achieved a positive fiscal 2013 cash flow (before depreciation) of nearly $190,000, compared with a negative $1.2 million for fiscal 2011. Eligibility denials involving erroneously entered insurance claims were reduced by almost 65%. And the organization enjoyed unprecedented public support for its $20 million project to build a new Fitchburg Family Health Center.

However, much still remains to be done. CHC’s board chair, Mary Giannetti, offers this advice to other organizations that need to effect profound change. “It takes commitment at all levels, but you don’t have to do it alone. Call in the experts and place trust in those you hire.” CMG co-founder Bob Harrington sums up the process at CHC: “Give employees some autonomy and expectation of accountability and you will motivate them to succeed.”

Yvonne Acquafredda has provided broad-based marketing and communications support to several companies in consumer services and healthcare. She has extensive experience in multi-site organizations. Ms. Acquafredda has a bachelor of science degree in communications from the University of Miami, a master of business administration degree from Northeastern University and a certificate in digital marketing from Rutgers University.

Lillian LeBlanc has more than 30 years of experience in the healthcare industry, assisting organizations with cultural transformation and boosting organizational effectiveness. She has worked with healthcare systems in Boston, Maine and South Florida. Ms LeBlanc holds a bachelor of science degree in economics, summa cum laude, from Boston State College and a master of business administration degree from the University of Massachusetts. She is a guest blogger for the Great Place to Work Institute, which produces Fortune’s annual list of 100 Best Places to Work For in America.

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