Another sign that the economy is mired in muck, with prospects for improvement any time soon being very dim:

A new survey shows a family health plan in 2010 averages $4,000 a year, up 14% from 2009. Meanwhile, the average employer contribution to a family plan hasn’t increased at all. [...] Overall, premium growth slowed slightly this year to 3%, with the average annual cost of a family health plan reaching $13,370. Workers picked up 30% of that bill. The average plan for a single individual cost $5,049.

Slow job growth. Incremental premium increases. Higher out-of-pocket expenses for care. Forget about cost-sharing. This is massive cost shifting, and healthcare consumers are being forced to take the brunt of the cost of that coverage. | LINK

In the nascent days of Pres. Obama’s reform legislation, much in the way of healthcare policy at the start of this crucial decade proceeds incrementally. With respect to the role of small businesses, expect the use of targeted tax credits for employees as another incentive for the smallest of those private proprietorships to remain viable in both the healthcare economy and the economy in general. It’s all about baby steps and getting skin the health reform game at the outset. The Congressional Budget Office estimates the credits could give up to $40B in savings to small businesses over the next 10 years and lower annual premiums by approx. 10 percent by 2016. | PDF LINK to Commonwealth Fund white paper

The massive increase in procedures over the past 20 years has added to the cost of providing care, to no one’s surprise. A study in the recent Radiology journal acknowledges this.

Part of the explosion in medical imaging over the past two decades may be attributable to overutilization, and steps need to be taken to cut back … Imaging services and their costs have grown at about twice the rate of other technologies in healthcare including lab procedures and pharmaceuticals…

Part of the problem fueling this growth has been the inclusion of many non-invasive standard imaging techniques as being procedure based — lumping the costs associated with uncomplicated, unenhanced CT imaging with, say, CT-guided renal biopsy — for example. Of course, bordering on the unethical side are the practices of self-referral within large imaging groups in many healthcare markets. | LINK

The application of the philosophy that is at the core of medicine: first do no harm — is a little at play in an article in the NYT. The rise of so-called concierge practices in the wake of healthcare reform has touched off a debate of sorts on the ethics of delivering such care. That is, you essentially pay for what you get — nothing more, nothing less. Perhaps its the myriad names by which its central workings are known that give it some ethical cover: membership medicine, concierge health care, cash only practice, direct care, boutique medicine. These terms convey one basic fact — the patient pays an annual fee (with other possible charges). In exchange for the retainer, doctors provide enhanced care.

[I]t’s hard not to wonder whether it is possible to practice in a way that reconciles concierge medicine with all the ethical concerns. One group of doctors in Boston believes it is possible. [...] But unlike other boutique practices, the retainer fee of $1,800 per year that these patients pay does not go directly to the doctors’ coffers. Instead, it is used to support the traditional general medical practice, the teaching of medical students and trainees and free care to impoverished patients.

Thinking of the delivery of this type of “specialized” primary care in which fees go to the process of delivery itself before direct provider revenue is another way some primary care practices hope to regain some lost footing in practices on the brink of dissolution or acquisition under the brave new world of reform. For some of these practices, for now, arrangements seem to be paying off — ethically, if not fiscally. | LINK

For the past six months insurance regulators in California have been working through negotiations with Anthem, a BC insurer whose initial premium rate hikes became a cause célèbre for healthcare consumers in that state and the Obama administration, alike. The previously proposed 39% increases created a firestorm in healthcare policy circles and provided Obama and HHS a temporary PR headache as a solution to lower premium increases was sought. The end result after scrutiny of state ledgers is a “smaller” increase —  of approx. 14 percent. | MP3 LINK

The AARP today released a watchdog analysis (using Medicare claims data) depicting the general increase in the price of the most popular prescription medications relative to prevailing inflationary trends. And, surprise! The lobbying group notes an almost 10 percent increase in the price of branded preparations straight from the manufacturer for 2009. Apparently, all but 6 of the over 200 brands studied showed any increase over the rates of inflation for that period. Pharma is quick to dispute the group’s findings as they do not include more precise reporting of actual point of purchase data to the consumer, forgoing mentions of rebates and plan discounts. | PDF LINK of AARP’s report

Medical loss ratios (MLRs), those metrics used by insurance companies to gauge medical costs as a percentage revenues from premiums, will be attracting some attention this week thanks to a provision in the recently passed reform bill that will allow a third party to be instrumental in determining how much insurers can ultimately spend on those admin costs — influencing profits in the process. That third party — the National Assn. of Insurance Commissioners (NAIC) — could have far-reaching authority in determining Insurance’s role in final implementation of the healthcare reform law come 2014.

HHS Sec’y Kathleen Sebelius could be at the mercy of the NAIC with respect to these new rules, creating disquietude among top Dems who favored reform with as little corporate influence as possible. Although the federal government has final say over where MLRs begin and end, states’ insurance commissioners actions will give lobbyists and insurers alike time to affect ultimate MLR regulations under reform law. Expect a mildly bumpy road at the hands of Insurance — which desires as little distance as possible between administrative quotas and earnings. | LINK

Illinois will offer this week the first-in-the-nation coverage plan for its uninsured since health reform was enacted. Currently, the state has almost 2 million uninsured by estimates. The plan to place them on coverage rolls will not reach them all — only a fraction, actually. Illinois’ Pre-existing Condition Insurance Plan can only enroll enough in its high risk pool because of federal funding limitations.^[1]

The creation of high-risk insurance pools under reform is one way over the next 4 years President Obama has said he will rein in coverage costs by mimicking enrollment/disenrollment policies of states; creating service areas of operation with HHS guidance; issuing creditable appeals processes for enrollees; preventing employers from creating disincentives for employee enrollment in those pools; and utilizing accountability rules to prevent fraud.

Illinois is the first state to test the waters in this transition to healthcare exchanges set to begin in 2014. | LINK

1. Funding comes from premiums and from the federal government, which is giving the state $196 million to run the plan until 2014 when healthcare exchanges will be required under the 2010 Affordable Care Act. [↩]

The state of Massachusetts has reached a deal with the fifth of six insurers initially denied rate hikes for coverage in that state. While nowhere near the massive increases sought in other high-profile states, Massachusetts’ most recent settlement involved a company’s requests for hikes in the 10% to 25% range for policyholders. Over 90% of coverage in Mass. has been positively affected by settlement negotiations with those five insurers which includes the individual market and small-business purchasers. The process of rate hike negotiations is just another factor in the long history of closely observed operations in a state which guarantees coverage to all of its citizens. | LINK

Healthcare reform begets the need for laws to ensure the intent of reform. This has never been truer than on the eve of implementation of the major role individual states’ insurance commissions in keeping Insurance accountable. As coverage begins to expand to include demographics never before considered by insurers, many states have no mechanism to face enforcements of the central tenets of the reform law. Most outstanding, states will now have the ability to review insurance premium hikes, for example — the number one stealth maneuver of insurers of late to guarantee profitability.

If states are not able to carry out insurance compliance in accordance with with reform law, the feds step in to guarantee standards. Problem is, as intricate as the central aspects of reform are, the provisions in many states’ laws are just as myriad.

Some state regulators said they would ask state legislators to expand their authority by putting the federal standards into state law next year. Others said they would rely on their powers of persuasion, the good will of insurers or general state laws that ban unfair or deceptive trade practices.

Despite assurances to states by the federal government that, ultimately, such oversight is well within their scope, gaps in executive powers vary widely; these inconsistencies place yet another wrinkle on the rapid rollout of reform provisions the Obama administration hopes will result in a smooth transition between the parties that will continue to drive healthcare in this country (insurers) and the ultimate functional unit of healthcare commerce (the physician-patient partnership). | LINK

I know Facebook exists, but I am not part of its ever-growing half-a-billion member network. But a pharma company apparently is. Novartis — maker of such patented mainstays as Lotrel and hot seller Diovan — was sent a notice by the FDA in which the government agency accused the drugmaker of violating Facebook terms in relation to their misleading potential consumers over a leukemia drug.

Once the drug info is viewed on the popular social network, users can spread the word about all of its benefits, but about none of its risks. In the ad for the drug, claims were made that it outperforms other anti-leukemia drugs on the market; those claims have not been proven. | PDF LINK

BC/BS Michigan is asking that state’s insurance regulators to vary the premium amounts on its Medigap supplemental offerings to seniors. It will ask state regulators to allow deeper discounts to low-income seniors while reducing the discounts on premiums for wealthier seniors. Medigap plans are standard insurance supplements to Medicare coverage offered only to beneficiaries with both Part A and B coverage.

Plans offered usually are the same; only the premiums can differ. All Michigan Blue Cross customers for the most popular of its Medigap policies now get a 39 percent discount off monthly premiums. The discount is distributed evenly to all Medigap policyholders, so that everyone pays just over $100.

It appears that with this move, the Michigan insurance marketplace is one of the first arenas in which states will negotiate with payers in the wake of expected cuts under Medicare Advantage offerings to fund reform over the next decade. | LINK

The push for widespread adoption of the electronic medical record has been viewed as an attractive by-product of health reform — a rather sexy “distraction” amid the legislative haranguing that has slowed the ongoing acceptance of reform as law. Perhaps our president is to blame. The electronic health record has an aura about it that sounds compelling at first, but its allure to many organizations considering its incorporation morphs into increasing trepidation as that day draws nearer.

For the Obama administration — assuming reelection — that “day” is the year 2014. The lofty goal of the creation of an e-record for every American by that time doesn’t seem to be taking into account the costs inherent in its smooth transition. That transition includes everything from logistical commitments to hidden costs that have yet to be accounted for, usually because of poor planning in the race to the early adoption for many health systems. For many of those systems, the reality of medical errors as a result of snafus in massive roll-outs is setting in. | LINK