Just when you thought that the only controversy to emerge surrounding reform this news cycle dealt with the initial forays into extended government-mandated coverage of children, think again. Now, a well-known corporate giant is warning the federal government that it may drop its employer-sponsored coverage of some 30,000 employees unless a key provision in the reform law is waived in its behalf.
McDonald’s Corp., which carries coverage with an insurer to provide capped plans to its low-wage workers, claims that its ability to do so will be threatened under reform; they cite tougher rules on a certain percentage of insurers’ premium hikes to cover massive administrative costs, known as the medical loss ratio (MLR). The Obama administration and the Democratic architects of the reform bill included provisions to limit insurers’ overreliance on MLRs as a basis for denying coverage by passing on those higher premiums to policyholders. McDonalds contends that its carrier cannot possibly meet the threshold of utilizing 80% – 85% of revenue on direct patient medical costs. Under reform, it says, its workers would immediately suffer — jettisoning coverage and raising the specter of workers either trying to qualify for government subsidy (Medicaid) or going it alone on the open market.
There’s another battle here for the soul of the reform law: a slippery slope of corporate exemptions that could weaken the intent of the law’s core mission — to curb healthcare delivery costs by forcing insurers to take a hard look at how they utilize profits versus federal government acknowledgment of a potential problem it has to squelch in favor of less desirable alternatives in the spirit of reform. | LINK
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
It has already happened in the Minneapolis/St. Paul metro. Now Duluth is in the midst of a nurses strike.
Nurses in Duluth voted overwhelmingly to reject a new labor contract, setting the stage for a 24-hour strike.
More than 90 percent of nurses who voted from St. Mary’s Medical Center and SMDC Medical Center, and more than 86 percent of those from St. Luke’s Hospital voted to reject the contract offer primarily because it did not include language that would allow them to close a unit to new admissions if they felt overwhelmed.
Again, the issue appears to be faulty staffing (nurse:patient) ratios. | LINK
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
Former HHS Secretary from the Clinton Administration, Donna Shalala told a standing room only crowd at the AHIP convention in Las Vegas over the weekend that the recently passed healthcare reform bill’s ultimate utility will depend more on the influence of insurers and not of the government.
“The American people voted not for a government takeover of healthcare, but they committed themselves to the employer-based system and private delivery,” she told the insurance industry crowd during a session titled, “A Way Forward: Next Steps for America’s Health Care System.”
While “a great deal of money” will be spent on public insurance programs, including Medicaid and Medicare, the “basic core” of reform will involve private insurers, she said.
Kudos to Shalala for being honest in this assessment. Although many insurers have begun taking steps to work within the framework of changes that will begin within the next two to four years, the reality is that private insurers will always have a stake in healthcare delivery. The development of exchanges, private-public contracts, and other mechanisms will be the result of the necessity to create innovation to maintain a robust healthcare marketplace. | LINK
The 12000-member nursing mega-union is playing PR hardball, going after the emotional jugular in advance of a walkout over staffing demands that seems all but certain.
In a news release Monday, the union cited several examples of what it calls dangerous staffing. Among them: a nurse at Methodist Hospital in St. Louis Park who said a dying patient “had to sit in his own feces” because no one was available to clean him up, and a nurse at Mercy Hospital in Coon Rapids who called for help when a patient’s surgical incision ripped open, “but nobody came.”
An expected and noble strategy, but one that could backfire. Although tableaus of patient horror stories like these evoke a visceral response, assigning these incidents to something as isolated, discrete, and simple as staffing inequities irresponsibly assumes public ignorance of the end product of something more insidious and global — a broken healthcare delivery system that yearns to be fixed via negotiation and cooperation, not bullying and scare tactics. Twin Citians as citizens and patients can easily understand that. | LINK
It continues to be a rather interesting and fun exercise watching how Massachusetts handles being the example of state-sanctioned guaranteed healthcare coverage. Over the past couple of months the escalating heat brought on by some of the state’s major insurers to test the state government’s reach on the regulation of premiums crescendoed recently, with a judicial ruling that expressed that the state was able to cap premium rate increases coverage for small businesses. Although the insurer in this case (Neighborhood Health Plan) agreed to only a 7.7 percent increase (down from an original 11 percent increase), other insurers are still pursuing the courts via the appeal process.
In a statement, Governor Deval Patrick applauded the settlement. “I appreciate the willingness of Neighborhood Health Plan to work with us to provide immediate relief from skyrocketing premiums,’’ he said, “and hope they will be an example to other health plans as well.’’
Time will tell; but for now, the first test over challenges to the state government’s insurance commission to regulate rates by its insurers guaranteeing small group and individual coverage seems to be in favor of the state. For Neighborhood Health, I wonder if they consider this episode one of “leading by example”. | LINK
Until today the major significance of June 1 was important for two healthcare policy-related developments: the initiation of the restructured GAMC safety net here in Minnesota, and the one-day nursing walkout. Since the latter is rescheduled for the 10th, the former kicks off today with as much uncertainty for its future stability as those ongoing nursing-hospital talks are currently demonstrating.
With the new focus of GAMC as one of operating within a strict healthcare (capitated) budget of sorts, many beneficiaries of the program in its former incarnation are not only finding it as challenging to negotiate it in order to retain the level of care they have gotten used to; they are also realizing that its current policy is somewhat finite and inflexible.
That is, until they are able to take advantage of a state-run program using matched federal funds later this year, they are realizing that access to that care has just become as complicated — almost intentionally so. Such is the case of a Duluth man with schizophrenia who now has to travel to the Twin Cities in order to receive the care he has become accustomed to, by necessity.
The purported one-day walkout is still on schedule to happen a week from yesterday, and the CEO of one of the health systems in the Twin Cities is exercising his philanthropic tendencies.
The chief executive of Allina Hospitals and Clinics is voluntarily working without pay until the Twin Cities’ biggest hospital chain reaches an agreement with its nurses.
Allina is the only group so far to make public any action which acknowledges the concern of the 12,000-strong nurses’ union — additionally, addressing the possibility that upper management would take pay furloughs if need be. At best, the move looks like a gesture of goodwill. At worst, a game of PR one-upsmanship against the other hospital and healthcare systems who have yet to appear to address the nursing collective in any public way. | LINK
Originating from Saint Paul, Minnesota, [doctorpundit.com] is a weblog about the policy of healthcare and where it intersects with politics and public opinion; it is edited by Michael Douglas, MD, MBA. Welcome, and please consider my take on what is Healthcare 2.0, complemented by a few of my thoughts on my personal avocations and guilty pleasures: music, prose, and writing. Follow Doctor Pundit via RSS above.
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DOCTOR PUNDIT @ ONE YEAR | An occasional DP series from 2010 highlighting healthcare policy trends over the period from 2009-2010 in a compare/contrast format.
