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Looking for middle ground on the ACA debate

April 18, 2017by Robert Whitcomb in Uncategorized tagged , ,

By EMILY LAZAR

For Kaiser Health News

Joel Hay, a professor at the University of Southern California, describes his political views as “conservative, free market.” But in a counterintuitive twist, his proposal to fix the Affordable Care Act would expand the largest source of public health coverage in the country: Medicaid.

Hay, who specializes in health policy and economics, envisions an Obamacare replacement plan that would scrap health insurance exchanges such as Covered California, which sell subsidized private market plans.

Instead, he would allow people under the age of 65 to buy into Medicaid, called Medi-Cal in California. Their premiums would be based on family income and a surcharge would be assessed on those who are uninsured at the time they apply. That would be intended as an incentive to keep them from buying insurance only when they’re sick. People could acquire coverage regardless of preexisting conditions.\

Under Obamacare, 31 states and the District of Columbia expanded Medicaid, the federal-state health care program for people with low incomes. In doing so, they added more than 11 million people to the rolls, including about 3.7 million in California.

Hay believes that the Medicaid expansion was the most successful part of the ACA and contends that the health insurance exchanges have struggled to provide affordable plans with adequate networks in many states.

He said expanding Medicaid further could achieve two important goals: slowing the growing costs of health care, which he said is better achieved by Medicaid than private market plans, and giving all Americans access to at least basic health coverage.

Scrapping the exchanges may not be an easy sell in the Golden State, where Covered California has been lauded as a national model.

Laurel Lucia, director of the health care program at the University of California at Berkeley Center for Labor Research and Education, agrees with Hay that the Medicaid expansion has been a success, but she wonders whether middle class consumers will enroll in Medicaid as readily as private market plans.

California Healthline recently interviewed Hay about his proposal, and Lucia for a contrasting point of view. Their comments, below, have been edited for clarity and length.

 

Joel Hay proposes scrapping the Obamacare exchanges and building on the expansion of Medicaid instead. (Courtesy of Joel Hay)

Q: Can you provide an overview of your Obamacare replacement plan?

It would build on the successful part of the Affordable Care Act, namely the Medicaid expansion that is responsible for the majority of the increased coverage.

This is how it would work: Below some family income threshold that would be yet to be determined, the cost of getting Medicaid would be zero. Above that, there would be premiums based on family income up to some maximum threshold, where the cost would be something like 10 percent of family income.

People would always have an option of opting out into a private plan if one is available to them. But this is a backup for anybody that doesn’t have other options.

This plan focuses on the two biggest problems in American health care. No. 1: Not everyone has health insurance. No. 2: We have the highest health care costs in the world.

Medicaid is a no-frills health plan available in all states. It’s not perfect, but it works. There are certainly access problems, but it seems to do a much better job, even in some of these rural areas where we’re seeing problems with the health insurance exchanges.

Q: In some states, such as California, the exchanges seem to be working reasonably well. Why lump all exchanges in one basket?

There’s a philosophical issue here. Is competition across health plans the best way to get affordable, basic care to everyone?

Among the majority of people that are reasonably well-educated, middle class or better, have good jobs and in fact maybe get their insurance through their jobs, the competition between insurance plans works reasonably well. But when you go further down the income scale, that’s where the competition doesn’t seem to work.

The Obamacare experience thus far backs that up. A lot of people just don’t seem to be able to get a good plan either because the premiums are skyrocketing or because the narrowing of the coverage options they have is prohibitive.

Q: Would your plan require everyone to have health insurance?

There is no mandatory requirement for having health insurance, but there are penalties if you go without coverage. If you don’t sign up during open enrollment, the only option you can get outside of that window would be this Medicaid option. The longer you delayed getting into it, the higher your monthly premiums would be.

Q: Would subsidized health plans still be offered through exchanges?

No. The subsidies to help people buy into Medicaid should be targeted to making sure everybody has access to essential care. The subsidies would be focused on helping low-income people get into a no-frills Medicaid health plan. The subsidies will phase out at some upper income level.

If you’re earning $96,000 for a family of four, hopefully the private market will generate options for you. But if you have no other option, this would be available to your family at a premium of 10 percent of your family income. That’s going to work out to be something like $10,000. That’s a lot of money, but that’s the problem we have.

Q: What do you mean when you say “that’s the problem we have”?

We’ve reached the point in this country where the average cost of health care per capita is over $10,000, whereas the median family income is only $54,000. A median family of 2.6 people is going to see over half of their income going to health care.

We have to consider other options. Medicaid is cheaper. It gets the lowest price for drugs by law and negotiates vigorously to get extremely low prices for medical services, hospitalizations, doctors. If you can get your health care through Medicaid, the cost per every unit of service is lower.

Q: Can the already-stressed Medi-Cal program {California’s Medicaid program} handle millions more enrollees?

It’s better than what has been demonstrated in the private health insurance exchanges under Obamacare. In Medicaid, people may have to travel long distances for specialty care, although some of those things can be overcome with telemedicine and other mechanisms. But we’ve seen pretty much a collapse of the private markets to handle people in rural, hard-to-reach places. Yet Medicaid has provided care to people in every state, including in every one of these remote access areas. It’s not perfect. Rural health care access is never going to be perfect.

Q: You have mentioned block grant funding of Medicaid as part of your proposal. That is what Congressional Republicans have been pushing to reduce federal spending on the program. How can you do that and significantly expand Medicaid at the same time?

I certainly wouldn’t want to hang the whole program on whether or not it’s block-granted. The argument in favor of block granting is if you give a certain amount of money per-capita to the states, it’s up to them to allocate the resources efficiently and effectively to provide the highest quality of care. If you continue with the current funding approach for Medicaid, the states have 50 percent or less of the responsibility for how the dollars are spent and so they’re not going to work as effectively to control costs and quality.

Some people on the far right want to actually destroy Medicaid. They think by block granting Medicaid, they can eventually make it go away. That’s not my goal here. My goal is to provide sufficient federal funds to make this thing work.

Q: Have you discussed this idea with any lawmakers?

I’m just beginning. What I see so far is that everybody is so polarized, that there really isn’t any movement in the middle. I’ve presented this to left-wing academics, and they say what they want to do is push through single payer, even if it’s only in California. They’re just not interested in compromise. I’m sure the same would be true of Tea Party Republicans.

No Death Spiral In Obamacare Exchanges

From Laurel Lucia, University of California at Berkeley Center for Labor Research and Education, health care program director

I agree with the conclusion that the Medicaid expansion has been working really well, especially in California. It’s true that Medicaid costs are lower than the costs to cover an equivalent population with private insurance and that Medicaid costs have been growing more slowly than costs in private insurance.

Q: What do you think of Professor Hay’s idea?

But I disagree with the premise that the individual market components of the ACA are failing. In California, the individual market reforms and subsidies have been working very well, and nationally I’d say they’re mostly working.

In California, we’ve had very high enrollment and we still have significant competition in the individual market. The vast majority of Californians have a choice of at least three insurers through Covered California.

Nationally, millions of people have been newly insured as a result of the individual market subsidies under the ACA. And affordability has improved significantly for low- and middle-income people who don’t have job-based coverage and need to rely on the individual market.

Both nationally and in California, I would not say that the individual market is in a death spiral.

Q: Aren’t there places where premiums have skyrocketed and choices have decreased?

There are places in the United States where much more plan choice is needed. We need to build on the Affordable Care Act reforms in the individual market to ensure greater choices and greater competition, rather than starting from scratch.

Q: It doesn’t seem like the current Congressional leadership wants to build on the ACA.

If there’s bipartisan will to make the ACA work better in terms of the individual market, it’s very possible to do with some policy changes. And in some places, like California, it is already working well.

Q: So why not end subsidized private plans and allow people to buy into Medicaid instead?

It’s an interesting idea to expand upon Medicaid. There is a question of whether middle-class consumers would enroll at the same rate in a Medicaid-type plan as they do in private insurance.

The provider networks in Medicaid are often quite different than those in plans offered through Covered California. Some consumers may be less likely to enroll in Medi-Cal if they have a strong attachment to their provider and that provider is not in the Medi-Cal network or isn’t accepting new Medi-Cal patients.

Q: Would middle-class consumers be less likely to sign up for Medicaid because of a perception or stigma that it’s just for poor people?

I just don’t know how Californians or Americans at higher income levels would perceive a new program like this that builds upon Medicaid.

If you were going to expand Medicaid to a broader population, you would want to make sure that it is adequately funded. One part of Professor Hay’s proposal would fund Medicaid through block grants, which would actually do just the opposite.

Most research has indicated that block-grant funding for Medicaid would result in substantial cuts to federal Medicaid spending over time without resulting in better cost efficiency. The loss of federal funding would force states to make difficult decisions like cutting eligibility, cutting benefits or implementing enrollment caps.

Block-grant funding would not only threaten Medicaid coverage for existing enrollees, but it would also be especially harmful if you were considering expanding the Medicaid population at the same time.

Q: What can be done to moderate health care cost growth, if not through Medicaid?

Cost containment is an important next step in federal health policy and state policy as well. Costs are growing too rapidly, not just in the individual market but also in job-based coverage, but those are trends that started well before the ACA.

They’re not due to the ACA. In fact, since the ACA, private insurance premiums have grown at a slower rate.

But we do need more focus on slowing the rate of cost growth. I think a lot of the barrier there is political. There have been a lot of solutions proposed to reduce costs, for example allowing Medicare to negotiate with drug companies on drug prices. And often Congress doesn’t want to take on the drug industry or the hospital industry or other aspects of the health care industry to reduce costs.

 

In Idaho, a glimmer of hope for rural hospitals

April 13, 2017by Robert Whitcomb in Uncategorized tagged , , , , ,

arco

By ANNA GORMAN

For Kaiser Health News

ARCO, Idaho

Just before dusk on an evening in early March, Mimi Rosenkrance set to work on her spacious cattle ranch to vaccinate a calf. But the mother cow quickly decided that just wasn’t going to happen. She charged, all 1,000 pounds of her, knocking Rosenkrance over and repeatedly stomping on her. “That cow was trying to push me to China,” Rosenkrance recalls..

Dizzy and nauseated, with bruises spreading on both her legs and around her eye, Rosenkrance, 58, nearly passed out. Her son called 911 and an ambulance staffed by volunteers drove her to Lost Rivers Medical Center, a tiny, brick hospital nestled on the snowy hills above this remote town in central Idaho.

Lost Rivers has only one full-time doctor and its emergency room has just three beds — not much bigger than a summer camp infirmary. But here’s what happened to Rosenkrance in the first 90 minutes after she showed up: She got a CT scan to check for a brain injury, X-rays to look for broken bones, an IV to replenish her fluids and her ear sewn back together. The next morning, although the hospital has no pharmacist, she got a prescription for painkillers filled through a remote prescription service. It was the kind of full-service medical treatment that might be expected of a hospital in a much larger town.

Not so long ago, providing such high-level care seemed impossible at Lost Rivers. In fact, it looked as if there wouldn’t be a Lost Rivers at all. The 14-bed hospital serves all of Butte County, whose population of 2,501 (down from 2,893 in 2000) is spread over a territory half the size of Connecticut. Arco, the county’s largest town, has seen its population drop 16 percent since 2000, from 1,026 to 857 last year. “Bears outnumber people out here,” is how hospital CEO Brad Huerta puts it.

The medical center nearly shut its doors in 2013 due in large part to the declining population of the area it serves — almost becoming another statistic, another hospital to vanish from rural America. But then the hospital got a dramatic reboot with new management, led by Huerta, who secured financing to help pay for more advanced technology, upgraded facilities and expanded services. He also brought in more rotating specialists, started using telemedicine to connect the hospital to experts elsewhere and is now planning to open a surgery center and a long-term care rehabilitation wing.

If Lost Rivers had closed, the alternative would have been hospitals in Idaho Falls or Pocatello, each more than an hour away across high-altitude prairie. Instead, “I don’t have to go across the desert for hardly anything,” said Rosenkrance, resting at the hospital the morning after the cow attack.

Rural hospitals are facing one of the great slow-moving crises in American healthcare. Across the U.S., they’ve been closing at a rate of about one per month since 2010 — a total of 78, or about 6 percent. About 14 percent of the U.S. population lives in rural counties, a proportion that has dropped as the number of urban dwellers grows. Declining populations mean a smaller base of patients and less revenue. And the hospitals are caught in a squeeze: Because many patients in the countryside are older and sicker, they require more intensive and often expensive care.

Faced with these dramatic economic and demographic pressures, however, some hospitals are surviving — even thriving — by taking advantage of some of the most cutting-edge trends in health care. They are experimenting with telemedicine, using remote monitors to track patients and purchasing high-tech equipment to perform scans and other types of exams. And because many face physician shortages, they are partnering with universities and increasingly relying on nurse practitioners, paramedics and others to deliver care. In parts of rural Oregon and Washington, veterans can get counseling through a tele-mental health program. Physicians in Iowa and North Dakota have access to virtual emergency room support.

At Lost Rivers — a dramatic rural health turnaround story — Huerta’s strategy was to use technology and innovation to offer the kind of high-quality medical care that would keep patients like Rosenkrance coming back. “Necessity is the mother of invention,” Huerta said. “Small hospitals like mine are always going to be under the gun. You have to get really creative.”

In the decades to come, America’s heartland and hinterlands will continue to be home to the people who run the country’s farms, forests and fisheries, and its wilder regions will continue to draw visitors who crave nature and recreation. And those people will need medical care. As a result, rural health researchers say hospitals like Lost Rivers are important test cases. They show that, despite daunting obstacles, rural America need not be left behind when it comes to health care. In fact, because they are being forced to innovate faster than their urban counterparts, they can provide a glimpse into the future of medicine.

“Being in a rural place does not preclude high-quality medicine,” said Tom Ricketts, senior policy fellow at the Sheps Center for Health Services Research at the University of North Carolina at Chapel Hill. “They are under a lot of pressure, but there are rural places you can point to as places you would say, ‘This is how things ought to be done.’”

Where Folks Wear ‘Multiple Hats’

It’s a Tuesday afternoon at Tara Parsons’ flower shop. She cleans up as she waits for customers — or for an emergency call. Parsons, a fourth-generation Arco resident, is not just the town florist; she is also the county coroner, a sheriff’s dispatcher and a volunteer emergency medical technician. This afternoon, she is on ambulance duty.

“We all wear multiple hats out here,” she said.
The streets are lined with shuttered and boarded-up storefronts, some with their signs still on display: the Galloping Goose, the Sawtooth Club. Residents talk nostalgically about the town’s heyday, when there were banks, a bowling alley and a movie theater, back when residents drove to Idaho Falls only twice a year, to get school supplies and do Christmas shopping.

The town of Arco was founded in the 1870s as a junction for horse-drawn stagecoaches. Its quirky claim to fame is that in 1955, it became the first town in the world to be powered by nuclear energy, a credit to the Idaho National Laboratory, down the road toward Idaho Falls. Every summer, to celebrate its history, the town puts on a celebration that features a rodeo and a softball tournament.

Now, most of the businesses are gone. The town still has a lumber shop, a hardware store and a few auto garages. There’s also a bar, a gym and a dollar store. And around the corner there’s the local diner — Pickle’s Place — where people come day and night for fried pickles and biscuits and gravy.

Like so many other residents, Butte County clerk Shelly Shaffer has a personal connection to the hospital: Her mom worked there, her sister was born there, and she used to take her children there. Lost Rivers Medical Center — which also has two outpatient clinics — is one of the town’s biggest employers.

“It would be devastating if we didn’t have our hospital,” she said.

That was the direction they were headed. When Huerta, the CEO, arrived four years ago, he found the nearly 60-year-old hospital in disarray — dilapidated facilities, fearful employees, reluctant patients and a financial mess left behind by the former CEO. The hospital’s bank account held just $7,000 and morale was at an all-time low. “We were the poster child for everything that was wrong with rural health care,” he said. “It had been a slow, steady decline from neglect.”

Shannon Gamett, 28, a nurse at Lost Rivers, said paydays were nerve-wracking: “We would run as fast as we could to the bank to cash [a paycheck], or it might not clear.”

After borrowing money to pay his employees, Huerta campaigned to pass a $5.5 million bond for Lost Rivers. He asked locals if it was worth $5 a month — one six-pack of beer or two movie rentals — to keep the hospital running. They answered “yes” at the polls, and the hospital emerged from bankruptcy. Next, Huerta set his sights on overhauling the badly outmoded facilities. One of his top priorities was the laboratory, which he said looked like a high school science classroom from the 1950s.

He instituted a new philosophy: If it doesn’t happen at a “real” hospital, it doesn’t happen at Lost Rivers. That meant ending some local practices, nixing little things like letting staff members wear scrubs of any color they fancied, and big things, like allowing people to bring their horses in for X-rays. “I said, ‘I have no problem doing this, but you tell me what insurance the horse has,’” he recalled. “The practice stopped immediately.”

To bring in more revenue, he applied for grants and got the hospital a trauma center designation (the first level IV trauma center in Idaho) so it could get paid more for the care it was already providing. He saved money by inviting the town’s residents to help renovate clinic exam rooms and by moving the medical records to a cloud-based system that didn’t require more information technology employees.

Prognosis Unclear

Despite Huerta’s efforts, however, the long-term success of Lost Rivers is not guaranteed. “If you don’t have enough people to support a clinic or a hospital, it has no economic reason to be there,” said Ricketts, the Sheps Center fellow. “It just disappears.”

Arco and Butte County officials hope the local economy will get a boost from a planned expansion of Idaho National Laboratory, which conducts nuclear energy testing and research. Residents also are mounting a campaign to get the Craters of the Moon, a national monument in Butte County, designated as a national park.

“It would literally put us on the map,” county clerk Shaffer said.

But even if that happens, Huerta knows he can’t expect a big influx of new residents. Rural parts of the United States saw an absolute decline in population following the 2008 financial crisis, a trend that has since stabilized. But there is little or no growth. So Huerta has to concentrate on keeping the patients he has — and giving them a reason to keep coming. And it’s working: The hospital is now making a small profit and has some reserves on hand for future projects.

“If you are not offering the services, people are going to go somewhere else,” Huerta said. “And as medicine advances and reimbursement is still pegged to volume, you have to find ways to keep that existing population here.”

One big challenge for Lost Rivers and many other rural hospitals is that their patients tend to be older — and thus sicker and costlier to treat. People 65 and older account for about 18 percent of the rural population, compared with 12 percent in urban areas, according to the National Rural Health Association. An older patient base can strain hospitals because Medicare, the public insurance program for the elderly, doesn’t pay hospitals as well as private insurance does. Elderly patients also may need more intense care than small hospitals can provide.
Some seniors move to Arco precisely because there is a hospital in town. But for others, what Lost Rivers offers simply isn’t enough.Rural hospitals have a higher percentage of patients on Medicaid, the public insurance for poor people, which pays notoriously low rates to providers.

Residents Ray Westfall, 82, and his wife, Winona, recently put their house on the market after deciding it was time to move to Utah, closer to family and more specialized health care. Westfall has neuropathy in his legs, which causes numbness most of the time. He gets around with a walker. Winona has dementia.

“We can get some care here at the local hospital, but mostly we have to travel to Idaho Falls,” he said.

Westfall is a regular at Parsons’s flower shop. On a recent Tuesday, he bought a bouquet for his wife — carnations, her favorite.

Parsons said many of the emergency calls she responds to are for older folks who’ve suffered strokes, fallen at home or are struggling to breathe. One 99-year-old woman she took to the hospital on this morning had fallen in her living room.

Parsons said she has known many of her patients for years, through her parents or grandparents. As they grow old and get sick, she picks them up in the ambulance and drives them to Lost Rivers.

“And before long, I’m doing their funeral flowers,” she said.

Telemedicine: A New Frontier 

At first the Bengal Pharmacy, on the bottom floor of Lost Rivers Medical Center, looks like any other pharmacy, with racks of over-the-counter cold medications, bandages, reading glasses and medical supplies. Shelves of prescription medications sit behind the counter. But it has no pharmacist on site; instead, technicians and students from Idaho State University in Pocatello shuffle about, filling prescriptions.

Their supervisor is a pharmacist at the university, about 80 miles away, who checks their work remotely. Patients who want to talk to him go to a small private room with a phone and video link. The pharmacy is named for the university’s mascot.

For rural hospitals, telehealth can make otherwise faraway services accessible to people where they live, said Keith Mueller, director of the Center for Rural Health Policy Analysis at the University of Iowa. That can be critical, especially during the winter when snowstorms sometimes cut off access to rural towns.

“We can, in effect, bring the provider to the community without physically doing so,” Mueller said. “Even in urban areas, people want more and more convenience in how we receive our services. Here we are talking more about necessity.”

At Lost Rivers, patients can have telemedicine appointments with a psychiatrist. And doctors can get virtual guidance from specialists in trauma, emergency care and burns. But new technologies sometimes take getting used to. “When you lose that hometown community pharmacist, that human touch, when you turn it over to computers, that’s a concept that people have difficulty with,” said Martha Danz, who sits on the hospital’s board.

Leon Coon, 83, said the concept is a bit foreign to him. “I just don’t do that stuff,” said Coon, who works loading hay. “I’m a little old-fashioned.” Sipping coffee at the truck stop early on a Wednesday morning, Coon said he doesn’t even text, so he’s a bit wary of technology that puts him in touch with a pharmacist all the way in Pocatello. But then again, he said he doesn’t rely on the medical system much at all.

“Anytime you go to the doctor, it’s just like a mechanic,” he said. “They’re going to find something wrong. I feel good most of the time, so I just don’t go.”

Shane Rosenkrance, whose wife got trampled by the cow, said he remembers when there were five community drugstores in the valley. Now, he is grateful to have the one pharmacy — even if the pharmacist isn’t actually behind the counter. “To have health care, you have to have a pharmacy,” he said. “And through technology, they are able to do it.”

Telemedicine is hardly a panacea. The projects often depend on grants or government awards, because rural hospitals’ operating margins are slim. And some of the telemedicine and remote monitoring technologies require high-speed internet, which isn’t always reliable or cost-effective in rural areas.

“You can’t do home monitoring everywhere,” said Sally Buck, CEO of the National Rural Health Resource Center. “You can’t do telehealth everywhere.”
“Ego is a dangerous thing,” he said. “If there is anyone who can do a better job, I’m going to get [my patients] there.”Telemedicine also may raise more questions than it answers for some patients, and even create a need for in-person follow-ups. Orie Browne, the medical director for Lost Rivers, said he tries to keep patients from having to travel. But if someone needs more advanced medical care — or a specialist that Lost Rivers doesn’t have — he will refer them to another hospital. The hospital has a helicopter pad, and patients with emergencies that can’t be handled at Lost Rivers can either be flown out by helicopter or transferred by ambulance.

Nevertheless, Huerta said, he hopes to expand telemedicine, including such services as oncology. Huerta recognizes that Lost Rivers doesn’t have the staff or the expertise to do it all. He believes the hospital should try to do more when it can, and refer out the rest.

“We aren’t trying to do brain surgery,” he said. “We’re not doing Level I trauma. But colonoscopies? Tele-oncology? People in rural areas get cancer too, and it’s demanding driving hours back from a chemotherapy session.”

Rounding Up Doctors

Browne started work at Lost Rivers one recent day in March, then drove 45 minutes to one of its outpatient clinics in Mackay, 26 miles away. One of his first patients was Elizabeth Galasso, 59, who was worried because her heart rate was racing.

“I was scared,” Galasso said, speaking with a hoarse voice as she sat hunched on the exam table. “I felt my heart pounding clear down into my stomach.”

An EKG showed her heart was beating normally. Browne told her it was likely a panic attack, but suggested a stress test just to make sure. He told her that her age, her smoking history and anxiety all put her at risk for heart disease.

“But I think things are going to be just fine,” he said. Galasso reached over and hugged him.

Browne, who took over as Lost Rivers’s medical director in 2015, said he was drawn to the outdoor activities in the area — and the variety of rural health care. He used to have a private practice in Idaho Falls and rotated into Lost Rivers for a week at a time. Now, he spends his days bouncing between the emergency room, the hospital inpatient beds and the primary care clinic. “That’s good for a person who gets bored easily,” he said.

Many doctors, however, don’t feel the same pull. Rural hospitals and clinics have long struggled to recruit doctors. In rural areas, there are roughly 13 physicians — of any kind — per 100,000 people, compared with 31 in urban areas, according to the National Rural Health Association.

Doctors and other medical providers can be enticed by programs that repay their school loans if they work in a rural area. Some medical schools have programs designed specifically for students who plan to practice in rural or underserved communities. Another way to make treatment more accessible in rural areas is to expand the responsibilities of nurse practitioners, physician assistants and even paramedics.

Lost Rivers relies on nurse practitioners and physician assistants to provide care for patients in the clinics and the hospital. In addition to Browne, the medical center has four part-time primary care physicians, some who live hours away and come in once a week. Various specialists, including a cardiologist and an orthopedist, also rotate into the medical center’s outpatient clinics about once a month. And an MRI machine gets driven to the hospital once a week.

Tim Tomlinson, a podiatrist who lives in Twin Falls and drives 100 miles to Arco once a week, spent a recent morning seeing a lineup of patients. One was a man who had to have a toe amputated after a horse stepped on his foot, another a diabetic who needed a skin graft checked on his foot.

Tomlinson said he’s gotten paid late before, and he has seen the hospital nearly shut down more than once. But he keeps coming because he has developed a practice — and he thinks its important patients have access to specialty care. Lost Rivers isn’t unique in its difficulties, he noted. “All those small towns are struggling as young people move out, leaving mostly old people,” he said. “That puts a drain on the hospitals.”

Patients are living longer with chronic diseases now, so the demand for elderly care is only going to increase. If not the rural clinics and hospitals, Tomlinson said, “who’s going to deliver it?”

Even with the decline in the nation’s rural population, many people are rooted in rural America because of family or because they like the outdoors and a slower pace of life. One of them is Gene Davies, who has lived in Arco more than 60 years, runs a mechanic shop straight out of a different era. Handwritten signs sit on a wooden chair next to the door: “Gone to Dr.” “Be back tomorrow.” “Hope to be back Monday.”

Davies said he appreciates the remoteness of the region. “I ain’t got no plans to go anywhere else,” he said. “I’ve seen enough of the other world. I don’t want it.”

Rosenkrance, the cattle farmer, said she’s not going anywhere, either. She’s been coming to the hospital since she was a child, when she ran through the halls while her father worked in the pharmacy. Now her husband teases her about having a standing reservation in the emergency room.

Just before discharging Rosenkrance, nurse Celeste Parson told her she needed to rest physically and mentally. The accident had left her with a concussion, a lacerated ear and a black eye. Then Parson issued her the most important instruction: Don’t do anything that could cause another blow to the head.

“We would really like you to rest up for at least a week,” Parson said. “But the doctor knows for you, two or three days is more realistic.”

As she grabbed an ice pack and her purse, Rosenkrance reflected on the importance of Lost Rivers for residents across the whole valley.

“This hospital is a big deal,” she said. “It’s saved a lot of lives.”

 

ACA could suffer death by a thousand cuts

April 10, 2017by Robert Whitcomb in Uncategorized tagged , , , , , ,

By JAY HANCOCK

For Kaiser Health News

The Affordable Care Act’s worst enemies are now in charge of the vast range of health coverage it created. They’re also discussing changes that could affect a wider net of employment-based policies and Medicare coverage for seniors.

Republicans failed last month in their first attempt to repeal and replace the ACA. But President Trump vows that the effort will continue. Even if Congress does nothing, Trump has suggested he might sit by and “let Obamacare explode.”

Health insurance for the 20 million who benefited from the ACA’s expanded coverage is especially at risk. But they’re not the only ones potentially affected. Here’s how what’s going on in Washington might touch you.

A three-year-old lawsuit threatens many plans.

A suit by the Republican-led House challenges some subsidies supporting private plans sold to individuals and families through the ACA’s online marketplaces, also called exchanges. It has already gained one court victory. By many accounts, it would wreck the market if successful, stranding up to 12 million without coverage.

“It’s the single-biggest problem facing the exchanges,” said Rachel Sachs, a health-law professor at Washington University in St. Louis. “That would make insurers not only exit tomorrow but also not want to offer plans in 2018.”

The litigation involves lesser-known ACA subsidies that reduce such out-of-pocket costs as copayments and deductibles for lower-income consumers. These are different from the law’s income-linked tax credits, which help pay for premiums.

Filed in 2014, when Barack Obama was president, the suit could backfire by politically harming the Republicans now in charge. House leaders have delayed the litigation and said they won’t drop the lawsuit but will continue the subsidies while it gets considered. The administration has not said how it plans to handle the lawsuit.

Policy confusion undermines coverage.

Even if Congress doesn’t repeal the ACA, the continuing battle makes insurance companies think twice about offering marketplace policies for next year. The less clarity carriers have about subsidies and whether the administration will promote 2018 enrollment, the likelier they are to bail or jack up premiums to cover themselves.

Preserving the subsidies, which limit out-of-pocket costs for lower-income consumers, “is essential,” said Kevin Lewis, CEO of Community Health Options, a nonprofit Maine insurer. “Markets don’t like uncertainty. The ‘sword of Damocles’ hanging over our collective heads is unsettling, to say the least.”

Democrats say Republicans are sabotaging Obamacare.

Shortly after taking power, Trump officials yanked advertising designed to maximize enrollment in marketplace plans just before a Jan. 31 deadline. It was partly restored after an outcry.

Then the administration said it would scrap an Obama-regime plan of rejecting tax returns from individuals who decline to say whether they had health insurance — weakening the requirement to be covered.

Trump aide Kellyanne Conway suggested in January  that the administration might entirely stop enforcing that requirement — the part of the law most hated by Republicans. If officials persist with that message, plans could attract even fewer of the young and healthy members whose premiums are needed to support the ill. That would cause more rising premiums and insurer exits.

“More mischief can be done,” said Dr. Peter Kongstvedt, a health industry consultant and senior faculty member at George Mason University. “It is absolutely possible that some markets will end up with no carriers unless a combination of state and federal government act to preserve the market” with taxpayer money.

Trump officials will move to roll back ACA coverage even if Congress doesn’t repeal.

Tom Price, M.D., secretary of the Department of Health and Human Services, has signaled his intent to reverse parts of the ACA through regulation even if Congress doesn’t repeal the law.

For example, Price couldn’t unilaterally eliminate coverage for birth control or maternity care, both of which many Republicans object to on moral grounds or because of cost. But birth control might no longer be free as a preventive benefit. Maybe the administration would let states limit the number of prenatal visits in maternity coverage. Perhaps more employers could gain religious exemption from providing birth control.

Medicaid coverage for low-income people could shrink.

Obamacare’s coverage expansion included government Medicaid coverage for folks with lower incomes. Thirty-one states and the District of Columbia expanded Medicaid to most adults with incomes below about $16,000 for singles and $28,000 for a family of three — although eligibility varies.

Republicans want to reduce the growth of Medicaid spending and give more control over the program to states. Discussions for a Medicaid overhaul focus on replacing ACA provisions with fixed, less-generous federal grants to states.

But even if the ACA survives, it’s likely the administration will give states more say in who gets Medicaid coverage and how much. Many Republicans favor work requirements for Medicaid recipients and raising out-of-pocket payments for patients.

Under the failed House replacement bill, the American Health Care Act, 9 million people in those states would have lost Medicaid coverage in 2020, estimated the nonpartisan Congressional Budget Office.

At the same time, however, Republican support for the ACA’s Medicaid expansion is growing, which might mean overall cutbacks would be less severe or Medicaid coverage could increase among the 19 states that didn’t expand the program under the ACA.

Some Republicans want to overhaul Medicare for seniors.

House Speaker Paul Ryan wants to restrain Medicare growth by giving members fixed, “premium support” payments to buy plans and possibly raise the age of eligibility. Both could lead to less coverage or greater out-of-pocket expense.

But the proposal wasn’t part of the Republicans’ replacement bill. Changing Medicare likely would trigger loud objections from AARP and other powerful lobbies. And Trump doesn’t seem inclined to back a change.

“I don’t think … Trump wants to meddle with Medicare or Social Security,” White House chief of staff Reince Priebus said in January.

Job-based coverage could become less generous.

Although ditching Obamacare would end the requirement for large employers to offer health insurance, most companies would keep their plans as a way to attract workers, analysts say.

But that coverage could become less generous. The ACA limits employer-plan members’ annual out-of-pocket cost and also prohibits caps on annual and lifetime benefits. At the same time, it prohibits waiting periods for covering a new worker’s preexisting illness.

Any replacement law signed by Trump might not include those protections.

Julie Rovner: Replacing the ACA: Where there’s a will there’s a way

April 5, 2017by Robert Whitcomb in Uncategorized tagged , , , , , , , , , ,

 

By JULIE ROVNER

Kaiser Health News

Now that the GOP effort to repeal and replace the Affordable Care Act is in limbo, is there a way to make it work better?

Democrats and Republicans don’t agree on much when it comes to the controversial federal health law, but some party leaders from each side of the aisle agree it needs repairs.

“No one ever said the Affordable Care Act was perfect,” said Senate Minority Leader Chuck Schumer (D.-N.Y.) on the Senate floor March 27. “We have ideas to improve it. Hopefully our colleagues on the Republican side do as well.”

A day later, Speaker Paul Ryan (R-Wis.) said, “We all want a system in healthcare where everybody can have access to affordable coverage, where we have more choice and competition.” And several GOP senators have moved away from the party’s long-held call for a total repeal and are offering bills that would amend the measure.

Health-policy analysts say that some of the health law’s marketplace problems could be improved with a bipartisan spirit. Here are some of the possibilities:

Stabilize the Insurance Market

Insurance companies have only a matter of weeks before they must tell the federal government and/or individual states whether they plan to offer coverage in 2018 on the health law’s online marketplaces, which serve customers who don’t get job-based or government insurance.

As of now, many companies say the uncertainty of what the market will look like — or the rules under which they will operate — is making that decision difficult. At least one insurer, Humana, has already said it would not offer coverage.

Two key moves that insurers are looking for from the administration are a promise to continue providing certain subsidies for those with lower incomes and enforcing the requirement for most people to either have insurance or pay a tax penalty.

The subsidies — known as “cost-sharing reductions” — are different than the tax-credit subsidies that many marketplace customers get to help pay their premiums. The cost-sharing subsidies help those with incomes between the poverty line ($20,420 for a family of three) and nearly 2½ times that ($50,400 for that same family) pay their deductibles and other out-of-pocket costs. The House  sued the Obama administration in 2014 for providing the subsidies without a formal congressional appropriation for the money, and a federal judge sided with the lawmakers.

The Obama administration appealed the decision, but if the Trump administration were to drop that appeal, the subsidies would disappear. At a House hearing March 29, Health and Human Services Secretary Tom Price, M.D. would not say what the administration plans to do about the lawsuit or the subsidies.

“I’m a party to that lawsuit and I’m not able to comment,” he said. But Ryan, who is also a party to the suit, said March 30 that he believes the administration should continue paying the subsidies until the lawsuit is resolved.

The administration has been similarly quiet about how strictly it will enforce the “individual mandate” that requires most people to have health insurance or pay a fine. On his first day in office, President Donald Trump issued an executive order directing federal agencies to “minimize the unwarranted economic and regulatory burdens” of the health law. But other than the IRS backtracking on a plan to enforce the mandate more strongly, little has happened on that front.

Yet those two provisions together — the cost-sharing subsidies and the individual mandate — could result in 25 to 30 percent increases in premiums if they were to disappear, said Andy Slavitt, who oversaw the health law for the final years of the Obama administration. Assuring that the subsidies will remain and the mandate will be enforced “would send a strong signal to (insurance companies) that they should continue to participate in the market,” he added.

Some GOP health policy analysts — including economist Gail Wilensky, who previously ran the Medicare and Medicaid programs — have proposed replacing the individual mandate with penalties for signing up for insurance late, which is what Medicare does. Republicans did that in their proposed replacement bill, by adding a 30 percent premium surcharge to those with a break in coverage longer than two months. But insurance actuaries and the Congressional Budget Office said that might eventually prompt fewer people to enroll because it would encourage healthy people to remain uncovered.

Entice People to Enroll

Getting young and healthy people to sign up for coverage is not just a benefit for them. If there are not enough healthy people in the insurance pool, then premiums rise for everyone, because risk is being spread across a mostly sicker population. And someday even the healthy people will need medical care.

But it takes more than just the requirement for coverage to get people to enroll. Slavitt said it requires a real effort by both federal and state officials to reach people and help them understand that having health insurance is a good thing, even if they are healthy. “What they should be doing is increasing marketing and the outreach budget,” he said. “You’re trying to reach people who are uninsured and are unsure how it all works, and it does take a lot of hand-holding.”

So far, however, the administration’s only move on that front was to cancel ads encouraging people to sign up at the end of the enrollment period that overlapped with Trump’s first days in office. The HHS Inspector General is now investigating the results of this action. Some analysts have estimated canceling the last-minute push lowered enrollment in the exchanges by as much as a half-million people.

Help Offset Insurer Losses

Democratic lawmakers who wrote the Affordable Care Act knew that the market might be hard for insurers to navigate for the first few years, and they built in several programs to help reimburse those who lost money.

Republicans, however, blocked funding for one of the major programs, which was intended to reimburse insurance plans that enrolled sicker-than-average populations for the first three years of the marketplace operations. Republicans called the money “insurer bailouts.” The loss of that money was a major reason for the collapse of many of the nonprofit insurance co-ops created under the law and some other insurance companies said it contributed to their decisions to leave the marketplaces.

Now, however, there are indications that Republicans might support some efforts to provide more funding for insurers.

On March 13, Price sent a letter to governors encouraging them to apply for waivers of the ACA rules in order to make insurance more affordable and available in their states. Among the state innovations singled out in the letter is a “reinsurance” program in Alaska that helps insurers pay for extremely high-cost patients. That plan, said Price, “significantly” offset what was a projected 40 percent premium increase in the state, and might be an option elsewhere under the waivers, which could allow states to get federal funding for such a program.

And the GOP health bill, the American Health Care Act, included $100 billion for a “Patient and State Stability Fund” that states with limited insurer competition could use to lower costs and help encourage insurers to stay in the market.

“They have a potential fix staring them in the face,” said Larry Levitt of the Kaiser Family Foundation of the GOP proposal for a stability fund. “It was a clever mechanism because the states could use it for any of a variety of purposes.” (Kaiser Health News is an editorially independent project of the Foundation.)

Assist Patients With High Out-Of-Pocket Costs

Democrats and Republicans agree that people who buy their own insurance are paying too much out-of-pocket, in premiums as well as deductibles and cost sharing.

Democrats mostly want to increase federal subsidies to help with affordability — something Republicans are not likely to embrace.

But there are other ways to lower consumer spending.

For example, Sabrina Corlette of Georgetown University’s Center on Health Insurance Reforms, calls for “smarter, not skimpier benefit design.” One way to do that is to set federal rules to push insurers that offer coverage with high deductibles to add more benefits that would be available without paying thousands of dollars first, like a few trips to the doctor or urgent care center or a few prescriptions. She writes that could keep people from dropping coverage because they feel they are not getting any value for their premiums. And if those mostly healthy people feel they are getting benefits they might use, they are more likely to continue to purchase coverage, thus reducing premiums for everyone.

Another potential way to lower insurance costs is to lower health care costs. Even if there are multiple competing insurers in an area, if there’s one dominant hospital system, it can pretty much charge whatever it wants.

“There’s no other price in the U.S. economy that’s growing as fast as a hospital price,” said Bob Kocher, a former Obama administration health official now at the venture capital firm Venrock. And in areas with not much hospital competition, “prices are 30 to 50 percent higher for everything.”

But how to get hospital prices down is almost as hard as regulating insurance. Kocher said one way would be for federal regulators to be more discriminating about approving hospital mergers, which tend to give hospitals more negotiating power over insurers.

More controversial would be to require hospitals that dominate their markets “to just accept Medicare prices” from marketplace insurers, Kocher suggested. While that would tend to bring prices down, it’s not likely to fly with free-market Republicans.

Right, wrong ways to fix the ACA

March 28, 2017by Robert Whitcomb in Uncategorized tagged ,

 

Harris Meyer writes in Modern Healthcare about right and wrong ways to fix the Affordable Care Act.

“Experts have ideas about what can be done to stabilize the ACA’s individual insurance markets and enable states to better control Medicaid costs. These include steps to encourage more young, healthy people to sign up for insurance, while discouraging people from enrolling only when they need medical care, then dropping coverage.

“But experts also have emphatic ideas about what not to do, including using reckless rhetoric about letting the insurance markets collapse, and making piecemeal changes without carefully considering corollary effects on the complex, inter-related healthcare system.”

“One target for the would-be bipartisan reform camp is the ACA’s taxes on health insurance premiums, medical devices, high-value employer health plans and branded prescription drugs. It’s easy to imagine Republicans and Democrats, backed by a wide range of eager healthcare stakeholder groups, uniting to repeal some or all of those taxes, which they argue increase premiums and medical costs.

“Those levies, however, provide funding for the ACA’s coverage and benefit expansions. Once you pull one thread of the ACA’s financing, the whole ball of yarn could unravel, because every interest group would demand its fair share of the returned booty. Then the hospital industry likely would insist on a return of its contribution, in the form of repealing the law’s Medicare payment cuts.”

To read Mr. Meyer’s article, please hit this link.

Mayo to cherry-pick patients with private insurance

March 16, 2017by Robert Whitcomb in Uncategorized tagged , , ,

cherry

The Minneapolis Star Tribune reports that Mayo Clinic’s chief executive recently told his staff to prioritize patients with commercial insurance over those with Medicaid or Medicare when possible.

The announcement came during a speech Mayo CEO John Noseworthy, M.D., gave to employees. Mayo stressed that the announcement refers  to cases where patients may be able to receive comparable care elsewhere, and that the prestigious hospital system still uses medical need as the primary factor in its decision-making.

Mayo cited an estimated $1.8 billion in unpaid Medicare services and an increased number of Medicaid patients across the organization in 2016 as reasons for its move.

“We need to balance requests from these patients with their specific needs—if it’s necessary for them to come to Mayo—as well as the needs of commercial paying patients,” said Karl Oestreich, Mayo’s spokesman.

Dr. Noseworthy said a recent 3.7 percent increase in Medicaid patients was a “tipping point” for Mayo.

“If we don’t grow the commercially insured patients, we won’t have income at the end of the year to pay our staff, pay the pensions, and so on so we’re looking for a really mild or modest change of a couple percentage points to shift that balance.”

To read more, please hit this link.

Higher physician spending doesn’t help hospital patients’ outcomes

March 13, 2017by Robert Whitcomb in Uncategorized tagged , , , ,

 

A study published in JAMA Internal Medicine found that higher spending on physicians doesn’t lead to better  outcomes for patients who have been hospitalized.

The study included data from a little more than 72,000 physicians over 1,324,000 hospitalizations of Medicare beneficiaries.

The authors found that, perhaps unsurprisingly, spending variation is greater among than physicians than among hospitals.

They said the data “suggest that not only does physician spending vary substantially even within the same hospital, but also that higher-spending physicians do not reliably achieve better patient outcomes.”

The authors point out that many payment-reform and value-based care efforts are targeted to hospitals that, it is assumed, can help influence physician behavior.  They  suggest that this targeting should also directly include physicians,  to help cut  costs.

“Our findings suggest that higher-spending physicians may be able to reduce resource use without compromising patient outcomes. Policy interventions that target physicians within hospitals (e.g., physician-level pay-for-performance programs and reporting of how resource use of each physician compares with other physicians within the same hospital) should be developed and evaluated.”

“Among both hospitalists and general internists, physicians with higher spending per hospitalization had no detectable differences in 30-day mortality or readmissions compared with lower-spending physicians within the same hospital. Given larger variation in spending across physicians than across hospitals, policies that target physicians within hospitals may be more effective in reducing wasteful spending than policies focusing solely on hospitals.”

To read the JAMA piece, please hit this link.

Medicare ACOs seen gaining this year

February 23, 2017by Robert Whitcomb in Uncategorized tagged , , , , ,

 

Avalere Health, the  consulting firm, sees financial-risk-bearing Accountable Care Organizations gaining more traction and popularity this year. It says that “providers will feel increasingly comfortable with assuming financial risk in exchange for larger incentives” as more than 9 million Medicare beneficiaries are covered by a total of 480  (ACOs), including 99 new participants, in the Medicare Shared Savings Program (MSSP).

The number of ACOs participating in the Next Generation ACO Model launched by the CMS Innovation Center has more than doubled to 45 this year, from 17 in 2016..

Of the 525 ACOs serving Medicare beneficiaries, 87 are in risk-sharing arrangements that include bearing financial losses if certain cost targets aren’t reached.

Healthcare Dive noted: “Expansion of MSSP and growth in the number of risk-sharing ACOs is due in large part to the passage of MACRA, which is accelerating the trend toward value-based initiatives through the Quality Payment Program. So far, it seems that MSSP has been successful saving a total of $466 million in 2015 and more than $1.29 billion total since 2012.”

“As Congress considers health reform, there is some doubt surrounding the future of value-based initiatives like MSSP, which was established by the ACA. One reform floated by Republican leadership could be detrimental to progress made toward value-based care.”

“This approach would cause Medicare to function more like traditional markets, which would increase financial responsibility borne by beneficiaries and leave improvements to market forces rather than government regulators.”

To read the Avalere report, please hit this link.

To read the Healthcare Dive analysis, please hit this link.

 

 

CMS nominee wants to overhaul Medicaid

February 17, 2017by Robert Whitcomb in Uncategorized tagged , , , , ,

 

Seema Verma, nominated by President Trump to lead the Centers for Medicare & Medicaid Services, told her confirmation hearing at the Senate Finance Committee that she’d consider clawing back parts of a rule set during the Obama administration that overhauled Medicaid managed-care programs.
She also  said he doesn’t want to turn Medicare into a voucher program, an idea backed by Health and Human Services Secretary Tom Price, M.D., and thinks  that rural healthcare providers shouldn’t face risk in alternative-payment models.

Ms. Verma said  that one of her priorities would be re-assessing a rule issued under the Obama administration that ordered states to more vigorously oversee the adequacy of Medicaid plans’ provider networks and encouraged states to establish quality rating systems for health plans. She raised the question of whether these mandates have  overly burdened the states financially.

On Medicaid,  she said that  “the status quo is not acceptable.”

“I’m endorsing the Medicaid system being changed to make it better for the people relying on it … and whether that’s a block grant or per capita cap, there are many ways we can get there.”

On Medicare, Modern Healthcare reported that Sen. Ron Wyden (D.-Ore.), the ranking Democrat on the Finance Committee, “said that she sounded like she wanted to keep Medicare a fee-for-service system.” The CMS under the Obama administration set goals to move Medicare away from fee-for-service, which was viewed as prone to abuse and fraud even as it has been very lucrative for physicians and hospitals and encourages much medically unneeded ordering of tests and procedures to maximize providers’ income.

But Ms. Verma denied Senator Wyden’s assertion and said that she supports Medicare focusing more on quality of care instead of volume.

To read more, please hit this link.

 

 

 

More execs being measured for population-health metrics

February 13, 2017by Robert Whitcomb in Uncategorized tagged , , , , , , ,

 

A small but growing number of hospital systems, among them Trinity Health System, America’s fifth biggest and based in Steubenville, Ohio, are linking executive  pay to population-health measures.As a Modern Healthcare article notes, “{T}he group is sure to expand as more health systems gravitate toward emerging value-based models and risk contracts that require hospitals to care for entire populations of people long after they leave the hospital.”

“Since Medicare began reimbursing providers based on quality and dinging them for poor performance in quality measures in programs like Medicare shared savings and value-based purchasing, providers have had to shift their focus to keeping people healthy long-term, rather than treating them only when sick. There’s ample empirical evidence that incentives drive behavior, so it made sense for hospital boards to prod leadership toward quality by putting part of their paychecks at risk.”

”Today, hospital executive compensation incentives are a mix of financial, quality, patient satisfaction and, increasingly, population health measures. Executive compensation experts say the weight is shifting toward the quality portion. Nearly all large health systems incentivize their executives based on cost, and 90 percent include quality measures, like hospital-acquired infections and readmission rates, in their annual plans, according to data from executive compensation firm Sullivan, Cotter and Associates,” Modern Healthcare reported.

But this will be difficult, given that it’s tougher to measure quality, with the subjectivity involved, than to  foll0w the metrics in old-fashioned fee-for-service medicine, especially if patient data from all appropriate providers aren’t  properly integrated in a health system.

To read the article please hit this link.

 

 

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