DOCTOR PUNDIT » Healthcare Legislation

Small Business Poised to Benefit Under Reform

Michael Douglas, MD, MBA — Thu, 02 Sep 2010 13:12:49 +0000

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

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Sebelius at Center of Newest Reform Legislative Technicality

Michael Douglas, MD, MBA — Mon, 23 Aug 2010 10:47:10 +0000

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

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California’s Governor Announces Statewide Broadband Health Informatics Network

Michael Douglas, MD, MBA — Fri, 20 Aug 2010 13:15:40 +0000

CMS has informed state Medicaid directors the terms of qualification for federal matching funds for administrative costs toward information technological infrastructures. Specifically, states must comply with the following stipulations: administration of Medicaid incentive payments to Medicaid eligible professionals and eligible hospitals; oversight of the Medicaid electronic health record (EHR) Incentive Program; and the pursuit of initiatives that encourage the adoption of certified EHR technology for the promotion of health care quality and the electronic exchange of health information.

Besides the latter bullet point above, the entrance of individual states into EHR IT initiatives carries with it a commitment to Medicaid funds in this era of reform. Some states are already on board, like California — whose governor couldn’t be more excited to get the ball rolling.

“What we are launching today is a new era for healthcare,” Schwarzenegger said. “Through a simple broadband link, this state-of-the-art system will save lives by instantly connecting people from across the state, including under-served and rural areas, with the best and brightest doctors. The California Telehealth Network marks the beginning of a new digital highway that will fundamentally change the future of how healthcare is provided.”

Others, like Minnesota, are leaving some state government agencies — and patients they serve — in a lurch.

Millions of dollars in health care funds seemingly destined for Minnesota after last week’s emergency session of Congress have yet to clear a final hurdle: the signature of Gov. Tim Pawlenty, an outspoken critic of the new federal spending.

UPDATE: In an unsurprising PR move, leading Dem candidate for Pawlenty’s job come November — former one-term U.S. Senator Mark Dayton — wants Pawlenty to just accept fed funds. | LINK

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Federal Government’s Role in Insurance Compliance under Reform Will Remain Significant

Michael Douglas, MD, MBA — Sun, 15 Aug 2010 11:12:13 +0000

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

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Study: Medicaid (California) ED Visits Up Sharply in Past Decade

Michael Douglas, MD, MBA — Wed, 11 Aug 2010 13:23:14 +0000

The underlying tenet of heatlhcare reform in this country is access. Achieving that access is a means to an end that separates reform’s political ideology essentially down partisan lines. The ongoing Medicaid saga and its “role” via the states is thorn in the current administration’s side as reform gets underway. With some jurisdictions embracing federal matching funds upfront to finance care in the near term, others are downright hostile to enter in to a commitment when individual states’ financial outlooks are so shaky.

A new study highlights the reality facing states whose budgets are so tenuous (in this case, California), the conflicting scenario between guaranteed healthcare access and the depletion of funds to finance it generally leads to one conclusion: no matter what state governments do to cut spending in one healthcare sector, costs seem to go up in another — sometimes at a far greater rate.

Increasing numbers of Americans, especially adults on Medicaid, are using hospital emergency rooms for their health care, say researchers from the University of California, San Francisco. [..]

The findings suggest that access to primary care is a key problem, Tang [the researcher/author] said. “Whether it’s primary care physicians are not accepting new patients with Medicaid or that there aren’t enough primary care physicians, we need to dig a little bit deeper,” she said.

More spending the answer? Seems really audacious at this point to even ask that question, let alone think it. | LINK

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Obama’s Remarks on Medicare Savings in Reform Criticized by CMS Actuary

Michael Douglas, MD, MBA — Mon, 09 Aug 2010 20:59:29 +0000

Critics of President Obama’s rosy outlook on Medicare reform as part of the Affordable Care Act are pointing to the entitlement’s chief actuary as proof that his sudden realization of Medicare’s fiscal virtues under reform are peppered with politics. As recently as last weekend, Obama praised the almost half a trillion in savings over the next decade to the federal budget as not only the most fiscally responsible action the government has implemented as part of reform, but also as part and parcel of the overall commitment to the nation’s seniors with respect to the affordable access to healthcare.

Chief actuary Richard Foster responds,

[T]he financial projections shown in this report for Medicare do not represent a reasonable expectation for actual program operations in either the short range (as a result of the unsustainable reductions in physician payment rates) or the long range (because of the strong likelihood that the statutory reductions in price updates for most categories of Medicare provider services will not be viable). I encourage readers to review the “illustrative alternative” projections that are based on more sustainable assumptions for physician and other Medicare price updates.

Those alternative projections do not include future Medicare costs over the next 20 to 25 years, which, according to Foster, cannot occur without continued cuts in payments to hospitals and providers. Together, with Social Security, Medicare costs are represented by trillions and trillions in unfunded liabilities; as slower payments to healthcare providers will do anything but create efficiency and cost savings — and everything to create care delivery disincentives over that time frame.

Interesting reading, and a compelling alternative to what fiscal conservatives see as Obama spin on this federally funded aspect of the reform movement. (Page 288 for Foster’s comments.) | LINK

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Obama Touts Medicare as Essential to Health Reform; GOP Cites Government Takeover

Michael Douglas, MD, MBA — Sun, 08 Aug 2010 16:45:37 +0000

Two thousand ten just may go down as the year that Medicare is finally getting the recognition it deserves. Well, perhaps in a half-perverse way, anyway. The government entitlement program, which has just celebrated 45 years as the godfather of all payers in healthcare, continues to gain ink in an otherwise unrelated news cycle. President Obama appears to be taking credit for saving the program’s solvency singlehandedly, as his vision of healthcare reform would be far less vital without a provision to forming a leaner, meaner CMS.

In his weekly address to the American people, Obama reiterated his commitment to a program that is more “secure” than ever, a “commitment to America’s seniors” — never wavering from that core point. Obama will likely continue that same tenor as he campaigns for (some of the more vulnerable) Democrats in this year’s midterms, highlighting Medicare’s fiscal leanness with such tenacity, that to acknowledge that the country is still mired in a recession flirting with across-the-board double digit unemployment and ever-spiraling jobless claims is completely tangential.

At this stage, it is not clear how this gambit of Obama’s will play out in November, especially when wide swaths of the general population demographic — not just seniors — need the reassurance he continues to express on health reform as generalizable and essential to economic recovery in this country. All the while, the GOP will continue to hold up Obama’s enthusiasm for government’s role in Medicare as reason that 16% of this country’s GDP is one of the prime causes of the current economic disarray.

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Obama Admin Buoyed by Entitlement Trustee Report

Michael Douglas, MD, MBA — Wed, 04 Aug 2010 01:27:54 +0000

The Obama administration can take solace in some favorable news to become official later this week, as the annual Medicare and Social Security trustees report detailing the entitlement programs’ fiscal health becomes public. The report says that the budget will realize approximately $8B in savings at the dawn of reform, with a trajectory of almost a half a trillion in overall savings by the end of the 2010s.

Although not considered a particularly incendiary demographic with respect to Obama’s reform goals, the nation’s senior citizens have expressed concern over the solvency of Medicare over the next decade. It is safe to assume that the administration will use this news as a talking point to assuage those fears — in addition to running ads like this as a surrogate method.

Critics of the Obama admin’s plan to trim Medicare and Medicaid costs are quick to point out the presumed diversion of those implied savings into subsidies for the uninsured over the next decade — a move, they say, does nothing to retain solvency into the 2020s or save on healthcare costs in the long term. | LINK to report [PDF]

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North Carolina Medicaid Enrollees Benefit from One of the Country’s Oldest Examples of the Medical Home

Michael Douglas, MD, MBA — Mon, 02 Aug 2010 13:15:47 +0000

Health care coordination seems to the mechanism by which many healthcare pundits on either side of the the debate agree on how significant waste in spending can be cut. North Carolina’s Medicaid program is utilizing the medical home model as an example of that type of care coordination.

Moving beyond Medicaid FFS and traditional managed care partnerships, the delivery of care in this context identifies the appropriate patient populations based upon services meeting certain primary care needs. Physicians are paid higher reimbursements and a specialized “care-coordination” fee as incentive to continue participation. Community care networks made up of primary care teams in multiple locations serving Medicaid enrollees are headed by physicians and serve as the de facto health plan for those patients.

This model is another example of putting state healthcare spending to practical use, empowering physicians who manage it not only to have a stake in its success but also to remain intimately involved in quality healthcare delivery at the state level. | LINK

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Report: FDA Pharma Approval Process Undermines Patient Access to Timely Healthcare

Michael Douglas, MD, MBA — Wed, 28 Jul 2010 15:58:46 +0000

A conservative health and public policy think tank reports on the consequences of a federally managed pharmaceutical approval and regulatory process and how that impacts patient access to timely and appropriate care — with respect to pharma availability. The Pacific Research Institute released its white paper detailing what it describes as the bureaucratic morass of “stymied pharmaceutical regulation” within the FDA’s drug approval process. A snippet:

During a 12-month period in 2008 and 2009, the European Union’s European Medicines Authority (EMA) and the Food and Drug Administration (FDA) approved a total of 39 new medicines. Fifteen were approved only by the FDA, 11 were approved only by the EMA, and 13 were approved by both regulators.

In five of the 13 cases where the FDA and EMA both approved the medicine, the EMA was the first to approve, and it issued those approvals 552 days faster than the FDA, on average. Even if we include all 13 medicines approved by the FDA and the EMA, the EMA approved those 97 days faster, on average.

The report goes on to describe the effects on impassive procedures of the FDA and its correlation to unnecessary medical tourism for similarly approved pharmacological treatments elsewhere. Although the report confirms what we all know about the costs of healthcare respect to governmental and regulatory mechanisms, perhaps this is another area in which Obama’s pick to head another regulatory agency addresses the need to apply quality and efficiency to the rather staid and arcane process of pharma approval.

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