Embattled WI governor, Scott Walker (R), issued a statement yesterday opposing the implementation of a state exchange as provisioned by the ACA — opting to defer action on the measure until the case is heard by the SCOTUS in March. In doing so, he will be returning almost $40 M in federal funding earmarked for the healthcare exchange. Whether this is earnest on his part or merely a symbolic gesture to Wisconsin GOP faithful in the wake of a pending certified recall vote on his office remains to be seen. Walker has always been against the passage of the reform law, instead focusing on efforts to deny federal assistance in doing so (states which choose this path will have to demonstrate fiscal independence on healthcare exchange creation by 1/1/13 or will be mandated a program by the feds).

Is this entire episode a game of chicken by Walker in light of his sudden vulnerability? It is, if one listens to the rhetoric from the state’s Democrats on the issue. Advocacy groups are also weighing their own disapproval of the governor’s intentions. The SOCTUS will hear testimony on the constitutionality of the reform law (notably, the mandate for coverage) over a two day period by the end of March. By the end of Februrary numerous amicus briefs will be filed by both Obama admin (DOJ) and plaintiffs (states) in the case. In spite of all the rancor surrounding this issue, it will difficult to envision striking of the mandate provision, much less the entire reform law as two lower courts have offered split decisions on the matter — prompting the SCOTUS to act quickly on a decision on the entirety of the ACA well before the election. | PDF brief from UCB Labor Center in support of the ACA’s constitutionality

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The cost of the delivery of healthcare in this country always seems to be independent of traditional models of demand in practically any other market-based, for-profit operation. That is, instead of relying on the parameters of patient (consumer) satisfaction or dissatisfaction; further innovation fuels the development of costlier, more advanced technology seemingly designed to break the bank (in one way or another) the very entity it is supposed to benefit: the patient.

An editorial reprint in today’s Minneapolis-St. Paul paper of record, the Star Tribune, makes the case for the unintended costly consequences this very innovation has on the big picture with respect to healthcare delivery in the 2010s. It focuses on the use of nuclear diagnostics developed by the Mayo Clinic as a superfluous and disruptive innovation which does the patient-as-consumer no favors…while benefiting the institution at the hands of government abetting.

Proton beam therapy is a kind of radiation used to treat cancers. The particles are made of atomic nuclei rather than the usual X-rays, and theoretically can be focused more precisely on cancerous tissue, minimizing the danger to healthy tissue surrounding it. [...]

To generate sufficient revenue, proton beam facilities need to treat patients with other types of cancer. Consequently, they have been promoted for patients with lung, esophageal, breast, head and neck cancers.

But the biggest target by far has been prostate cancer, diagnosed in nearly a quarter of a million men each year. [...]

With Medicare reimbursement so generous, and patients and doctors eager for the latest technology, building new machines is sane, profitable business for hospitals like Mayo.

But it is crazy medicine and unsustainable public policy.

Maybe so, but the practice of medicine depends upon the richness of technologies in which parties not only compete toward developing paths of effective treatments for chronic diseases (like cancer, in this case), but also race to spur further research on the nature and behavior of disease. It is within this self-fulfilling prophecy of the cycle of medical education that knowledge moves forward — something the creators of publications like this one thrived upon. And, that’s a good thing. | LINK

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Honestly, these “clock-ticking countdowns” are getting a little irksome. The eleventh hour negotiations surrounding the legislative extensions of the payroll tax cuts for the middle class just hit another roadblock, outlets have reported. Cue the Senate showdown between the GOP and Dems. Closely tied into the GOP plan for the extension of the tax cut is the inclusion of the Keystone XL oil pipeline — a controversial project which President Obama had originally hoped to decide upon by 2013 its potential for environmental sustainability.

The Keystone pipeline pawn would force Obama to make a decision on its contruction by the end of this year.

With respect to healthcare, the inclusion of provisions to forestall cuts to Medicare payments for 2 years, preventing incremental threats to physician reimbursements (no permanent overhaul), would be the political gambit. It’s a political mixed bag for some healthcare entities. Hospitals would be better served by more long-term solutions to the so-called doc-fix problem. Providers would be spared more frequently intermittent threats to reimbursement. If passed, this payroll tax cut extension would eliminate the possibility of approximately 27 percent in cuts to Medicare payments.  | LINK

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Grants in the total amount of over $1B will be targeted to healthcare orgs that work with federal agencies in an effort to increase the size of the overall healthcare workforce. The Obama administration is expected to announce today the availability of the funds to get initiatives started in as little as 6 months. I must admit, I was sent information on taking part in this effort.

“This will open the inbox for many innovators and organizations that have an idea to bring to the table,” Don Berwick, administrator for the Centers for Medicare & Medicaid Services, said in an interview. “We’re seeking innovators, organizations and leaders that have an idea to bring into further testing.”

Participating orgs with ideas brought to the table will be  grouped in the specially named CMS Center for Medicare & Medicaid Innovation. The initiative, praised by CMS head Don Berwick, is betting on using federal monies as an incentive to get the government involved in vetting other possible ways to spend more frugally ahead of reform and a pending physician shortage by decade’s end — two scenarios that will have to be met forcefully to ensure the onslaught of much needed healthcare delivery that won’t come cheap. | LINK

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Okay, here’s what we do know about the current state of solvency of Medicaid post-stimulus funding: states are grappling with a larger share of Medicaid liabilities than before, and they are immediately reacting with a combination of cuts to providers/hospitals and pulling in the reins on certain services.

Although states are bearing a bigger share of the Medicaid burden this year than they have in the recent past, overall Medicaid spending (state and federal dollars) is projected to grow by only 2.2 percent, the lowest amount since 2006, [a] Kaiser report [shows]. That is because the stimulus funding ended, and program costs are stabilizing as the national economy shows tentative signs of recovery and enrollment growth slows.

The article is a lengthy one, but worth a read. The Kaiser-funded survey trial of states with respect to this question suggests many states are implementing myriad Medicaid spending stopgaps in the short term. All this is on the table as the bipartisan so-called congressional supercommittee gets ready to release its report on trimming the current budgetary deficit.

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The news Wednesday morning of a 3.6 percent increase in Social Security COLA payments for 2012 is somewhat of a mixed blessing for Medicare beneficiaries, many of whom have had to shoulder stagnant SS income over the last couple of years due to negligible inflation. The increase — set to take place in January — could be offset by higher Medicare B premiums, which are deducted from SS payments.

Typically, and unsurprisingly, Medicare B premiums increase at rates higher than inflation — but those increases cannot exceed COLA, by law. Dually eligible recipients over the last couple of years, as well as higher income senior beneficiaries, were not protected from rate increases over 2010 because of Medicaid payments incurred by the former and Part B surcharges paid by the latter group.

The majority of Medicare beneficiaries, however, paint a variable picture with respect to SS income and Part B liability; and the degree of variability has to due with the amount of the monthly SS benefit paid to seniors. All of this is a stark reminder of the degree of the increasing costs of healthcare delivery on Medicare and how it compares and impacts SS entitlements year-in and year-out.

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From the Did You Know category today: the state of Indiana is challenging a key provision of the ACA having to do with the medical loss ratio for insurers. That’s the amount by which insurance premiums are set a certain degree of cost implementation for overhead. The ACA requires the insurer to spend 80 percent on healthcare delivery, or else pay a fine. Indiana is pursuing a federal waiver from this proviso. Healthcare consumer advocacy weighs in.

Indiana’s application is based on state politicians’ ideological opposition to health reform, not the realities of the state’s health care market … As the MLR regulations make clear, there must be a credible threat to the stability of the individual marketplace in order to grant a waiver. Indiana has demonstrated no such threat. We urge [HHS] to reject Indiana’s application.

Indiana is the only state in the country to request that consumer high deductible health plans be exempted from MLR provisions unconditionally. HHS will ultimately decide on the matter. | LINK

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While California struggles to make some headway in reconciling its budgetary woes amidst an outcry from patients, hospitals, and physicians with respect to Medicaid funding, the funding of Medicare — specifically via auterity measures to ensure its short term viability within reform — is a top concern among the same factions. Only this time, the ire is directed towards the commission charged with implementing payment scales.

The [sustainable growth rate] calls for annual, automatic cuts in Medicare payments to doctors, which Congress always delays, allowing the cuts to accumulate. MedPAC is considering a 10-year replacement that would be offset by cuts to most medical specialties. But the American Hospital Association said health care providers shouldn’t have to foot the bill for a new formula.

MedPAC knows that this is an issue which legislators are echoing, as well. It is becoming a rather common — and exasperating — rite of passage: automatic SGR cuts in Medicare reimbursements which are usually stalled by Congress; the inevitable revisiting of definitive methods to decrease healthcare costs due to Medicare next on the agenda. Most parties agree on that point, just as long as that agenda does not include massive industry cuts (read: providers) within healthcare delivery. | LINK

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Alzheimer dementia continues to be among the most heavily researched and funded chronic diseases in medical science today. The increased awareness, brought into the spotlight and “modernized” more than 20 years ago following the high profile revelations of celebrites and politicians afflicted with the disorder, has led to increased patient education, public policy initiatives, and, of course, greater research monies in the effort to not only treat symptoms, but also to find a cure.

An international advocacy group is now asking municipalities to take awareness a notch higher with the commitment to even greater awareness of the disorder — addressing what it calls a “treatment gap”, hampering any gains on detection of the disorder at its earlier stages. Here in the U.S., the Obama admin is apparently hard at work in developing the country’s first-ever national anti-Alzheimer strategy aimed at sharply cutting the enormous healthcare costs associated with ancillary treatment .

The National Alzheimer’s Project: From Act to Action is an effort to support a committed and effective implementation of the National Alzheimer’s Project Act (NAPA). Information collected from individuals living with the disease, caregivers, providers and other stakeholders will be shared with the U.S. Department of Health and Human Services, which is responsible for creating a national strategy to address the crisis and coordinate across government agencies. This project is facilitated and supported by the Alzheimer’s Association.

Consider this effort an amalgam of citizen awareness and discussion (townhalls) and legislation (congressional passage of the National Alzheimer Project Act) garnering bipartisan^[1] support to fight a scourge that can leave heavy financial tolls on caregivers, families, and the healthcare delivery system itself.^[2] A daunting task, to be sure — but one that is sorely needed. Here’s looking forward to December — the date when the president makes his plans for these initiatives very public. | LINK

1. Just how bipartisan? In 2007, Newt Gingrich co-authored an article in Alzheimer’s and Dementia: The Journal of the Alzheimer’s Association, making the case for the creation of a federal Alzheimer strategy.
2. Alzheimer’s Association advocates sent more than 15,000 email messages to the White House asking the President to sign the National Alzheimer’s Project Act into law; on 1/4/11, he did — making this action the most significant legislative action with respect to Alzheimer funding intiatives up to this point.

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If one assumes that news of cuts in reimbursements of the two major healthcare entitlements (which probably will not happen) is never really good news for providers when accompanied by news of overall decreases in government spending on Medicare and Medicaid — then news of OMB-projected reductions in entitlement spending over the next decade essentially confirms this postulate. Under current fiscal policy, the government is expected to spend about $4 billion less this year on Medicare, matched with another $4 billion reduction over the next decade compared to the administration’s previous estimates, according to those revised projections.

When coupled with a virtually stagnant U.S. economy, a subsequent decline in payroll tax means finding alternatives to fund not only Medicare, but also Social Security. FY 2012 mandatory spending (which now includes funds spent on TARP funding) on Medicare will top north of $450 billion. If more than half of the budget goes toward entitlement spending, it’s difficult to realize other options when it comes to managing discretionary expenses — even with President Obama’s push for healthcare reform. Choosing between raising taxes, decreasing SS payouts to retirees, or inflating the budget as a percentage of GDP — just to maintain fiscal gov’t solvency — is enough to give any healthcare policy wonk a massive headache.

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