ObamaCare’s impact on health costs.
“Giving health-care providers a lump sum payment for certain treatments – touted as a way to save money and improve coordination of care — yielded disappointing results for some major California hospitals and insurers, a study found.
The RAND Corp. study, funded by a $2.9-million federal grant, looked at “bundled payments” for care of insured orthopedic patients under 65 at a handful of large hospitals and insurers in California.
Six of the state’s biggest insurers and eight hospitals started out in a pilot program in 2010, but only three insurers and two hospitals actually decided to enter contracts to adopt bundled payments. The others dropped out because they didn’t think bundled care, such procedures as total knee replacement surgery, would change the delivery of care significantly or lower costs, according to the study, published in the journal Health Affairs Monday.
The pilot project resulted in such a small number of hospital cases that it was hard to draw conclusions about how bundled payments affect health care quality or costs, which were the initial goals of the study, the researchers reported. Two ambulatory surgery centers managed to partner with an insurance company and had a higher volume of cases, but generally health plans have been slow to contract with them, the study found.
“That was unexpected,” said Susan Ridgely, the lead author of the study and a senior policy analyst at RAND, a Santa Monica, Calif.-based think tank. “They were a bit more flexible and also wanted the business, but hospitals began to see that it required too much time and effort or maybe that it was not in their best interest.””
“Francisco Velazco couldn’t wait any longer. For several years, the 35-year-old Seattle handyman had searched for an orthopedic surgeon who would reconstruct the torn ligament in his knee for a price he could afford.
Out of work because of the pain and unable to scrape together $15,000 – the cheapest option he could find in Seattle – Velazco turned to an unconventional and controversial option: an online medical auction site called Medibid, which largely operates outside the confines of traditional health insurance. The four-year-old online service links patients seeking non-emergency care with doctors and facilities that offer it, much the way Priceline unites travelers and hotels. Vetting doctors is left to prospective patients: Medibid does not verify credentials but requires doctors to submit their medical license number for patients to check.
Velazco paid $25 to post his request for knee surgery. A few days later, he had bids for the outpatient procedure from surgeons in New York, California and Virginia, including details about their expertise. After accepting the lowest bid — $7,500, a fee that covered anesthesia and related costs — he learned that his surgeon would be William T. Grant, a Charlottesville orthopedist.”
“If being uninsured were no big deal, presumably Obamacare never would have been enacted. The whole premise of the law is that being uninsured is a bad thing, so it’s well worth wielding a few carrots and sticks to get people into coverage. Unfortunately, Obamacare has had to break more than a few eggs along the way. One of the presumably unintended consequences of this misguided law is the fashion in which it encourages some young adults to become uninsured. These are the very young people that the Exchanges need to sign up for coverage if they are to avoid a death spiral.
It may seem puzzling that a law that both hands out subsidies to encourage coverage and imposes penalties on those who do not could possibly increase the incentive to become or remain uninsured.”
“Did you hear the great news? According to the latest Medicare Trustees report, “Medicare isn’t going bankrupt,” and Vox has a chart to prove it! Not only that, “slow health cost growth has improved Medicare’s financial outlook, extending the program’s trust fund to last until 2030.” That’s four years longer than last year’s forecast!
It all sounds great until you hear what Vox unaccountably elected not to tell its readers. All those rosy Medicare predictions are based on a scenario that no one with any common sense should believe.” As PolitiFact.com pithily puts it: “There are good reasons to question whether things will pan out that way.” Indeed, you don’t exactly have to be a mind-reader to see that the Medicare actuaries also don’t believe this scenario which is precisely why they again (as they have done routinely in 2011, 2012, and 2013) released an alternative fiscal scenario that is far more likely to transpire.
Medicare Part A Actually Will Grow 2-1/2 Times As Fast As Vox Says
When Vox says the trust fund will last another four years, that’s a reference to the Part A Hospital Trust Fund. Under the so-called “projected baseline” used in the Trustees’ report, the trust fund will indeed last until 2030. But that baseline portends cuts in hospital payment rates so drastic that Obamacare-mandated reductions in payments to hospitals so drastic that:
•Hospital payments for both Medicare and Medicaid will be 38% lower than the amounts paid by private health insurers by the year 2030 (Figure 1).
•Eventually, payment reductions to hospitals will mean they are paid 59 percent less by Medicare and Medicaid than by private health insurers!””
“In an oped for Politico, I explain why ObamaCare architect Jonathan Gruber’s 2012 admissions that “if you’re a state and you don’t set up an Exchange, that means your citizens don’t get their tax credits” matter to the ongoing litigation over the Obama administration issuing those subsidies in federal Exchanges, and why Gruber’s attempts to explain his own words away are not credible. Shortly after submitting that piece, I learned Oklahoma Attorney General Scott Pruitt found Gruber’s remarks relevant enough to ask a federal court hearing one of those cases to take notice.
Gruber’s repeated remarks contradict the Obama administration’s legal argument, made in Halbig v. Burwell and three related lawsuits, that it is implausible that Congress would have conditioned those subsidies on states establishing Exchanges. His remarks likewise contradict the amicus briefs Gruber himself filed in two of those cases. (Here’s my response to those briefs.)”
“Florida Blue, the state’s largest health insurer, is increasing premiums by an average of 17.6 percent for its Affordable Care Act exchange plans next year, company officials say.
The nonprofit Blue Cross and Blue Shield affiliate blames higher health costs as a result of attracting older adults this year who previously lacked coverage and are using more services than expected.
Florida insurance regulators plan to release rate information for all companies next week. The exchange plans cover individuals who aren’t covered by employer-based policies.
Florida Blue offers many plans. The 40 percent of its individual policyholders who chose “narrow network” plans called BlueSelect that limit coverage to fewer doctors and hospitals will see rates rise by an average of 13 percent.
Critics of the health law have predicted big rate hikes in the second year of the online marketplaces. Florida Blue CEO Patrick Geraghty noted that premiums in the individual market have been going up for years. “In the individual market, this type of average rate increase is typical,” he told Kaiser Health News. “It’s is not aberrant.””
“Andrew Slavitt, a former executive at the technology company tasked with “saving” HealthCare.gov and now second in command at the agency overseeing Obamacare, yesterday ran into sharp questions from a House panel about a potential conflict of interest in his new role.
Rep. Morgan Griffith, R-Va., pressed Slavitt on his previous job at OptumInsight/QSSI and that company’s continuing involvement with HealthCare.gov.
“How are you able to manage your former employer, and doesn’t this create a conflict of interest?” Griffith asked Slavitt during the new Obamacare official’s testimony before the Energy and Commerce Subcommittee on Oversight and Investigations.
Slavitt, the new principal deputy administrator at Centers for Medicare and Medicaid Services, didn’t go into specifics, but said he had limited contact with his former employer. He assured Griffith and other subcommittee members that he was taking the proper steps to maintain ethical standards and noted that he had signed an ethics pledge.
“As a public servant, I have a very clear set of rules to follow,” Slavitt said.”
“The weighted average increase for plans being sold on the Obamacare California public exchange in 2015 will be 4%. So, that means Obamacare is working really well, right?
Well, wait a minute.
Let’s consider a few things:
1.This week the California insurance commissioner reported that the average unsubsidized 2014 rate increase carriers charged going into Obamacare was between 22% and 82%. That was a pretty healthy bump to get everyone into Obamacare in the first place.
2.California voters will go to the polls this fall to vote on Proposition 45. That ballot initiative would regulate health insurance rates in California for the first time. Big rate increases on part of the carriers would do a lot to get that proposition passed and very low increases would do a lot toward defeating it.
3.The health plans competing in the Obamacare exchanges are limited to tiny losses this year because of the Obamacare reinsurance program that runs through 2016. In effect, anymore underpricing they put into their rates for 2015 is subsidized by the federal government. In fact, the Obama administration recently took the statutory caps off of how much they can pay the carriers to keep their bottom line whole.”
“The Affordable Care Act may be the law of the land, but some states are still doing their best to avoid it. Nearly half the states have refused to participate in the law’s expansion of Medicaid. Some describe this reluctance as tantamount to a moral crime—see Virginia Governor Terry McAuliffe’s recent statement that expansion’s opponents are “prevent[ing] their own constituents from getting access to health care.”
As a doctor, I know this isn’t true. Medicaid is sold to the public as a magic pill that will solve the poor’s inadequate access to medical care. But reality isn’t so simple.
Simply put, Medicaid gives patients terrible access to medical care. A recent study found that nearly a third of doctors no longer accept new Medicaid patients. In some states, as many as 60 percent don’t. Why not? Because Medicaid operates in a world without economic logic.
Bureaucrats in Washington dictate how much money doctors receive for the treatments and services they provide. Unfortunately, on average they reimburse at less than the actual cost—the average Medicaid reimbursement is 40 percent less than the reimbursement from private insurance.
Medicaid payments don’t even match the reimbursement rates for Medicare. Primary care receives 59 cents for every Medicare dollar. Obstetric care receives 78 cents. Overall, Medicaid receives 66 cents for every Medicare dollar—a one third cut for the exact same service.”
“The price tag for healthcare.gov, the Obamacare website, is approaching $1 billion even as key features remain incomplete, congressional auditors said.
The budget to get the site ready for the next round of enrollments, starting in November, jumped to $840 million as of March, according to the Government Accountability Office. That’s a $163 million increase since December.
Accenture Plc (ACN), the company that took over building the site that failed at its introduction this past October, is expected to be paid $175 million as of June, an $84 million increase from the estimate in January when it signed a contract. The data are part of testimony for a congressional hearing today in the Republican-led House. The GAO places blame for the site’s rising price on poor planning and supervision of contractors who built the federal health exchange.
If the management doesn’t improve “significant risks remain that upcoming open enrollment periods could encounter challenges,” William Woods, the GAO’s director of acquisition and sourcing management, is scheduled to testify according to prepared remarks released by the Energy and Commerce Committee.”