Friday, October 17, 2014

Fwd: qotd: Complexity of the 90 day grace period for paying exchange plan premiums

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From: Don McCanne <don@mccanne.org>
To: Quote-of-the-Day <quote-of-the-day@mccanne.org>
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Subject: qotd: Complexity of the 90 day grace period for paying
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Health Affairs
Health Policy Briefs
October 16, 2014
The Ninety-Day Grace Period

To help enrollees new to the system keep their insurance, the ACA
provides a ninety-day grace period before an insurer can discontinue
someone's coverage for failure to pay a monthly premium. This applies
only to those who have received an advance premium tax credit to
purchase health insurance through the Marketplaces and have previously
paid at least one month's full premium in that benefit year.

The grace period allows for continuity of care for patients by
preventing people from shifting or "churning" in and out of coverage
when they fail to make a monthly premium payment.

In final regulations, CMS said issuers must pay all appropriate claims
for medical services rendered to the enrollee during the first month of
the grace period, and the insurer may put on hold claims for services
rendered to the enrollee in the second and third months. Issuers must
also notify HHS of such nonpayment and notify providers of the
possibility for denied claims when an enrollee is in the second and
third months of the grace period.

During these second and third months of the grace period, because the
patient is still insured, he or she cannot be billed by the provider for
any remainder that is owed for medical services that the enrollee
received. But if an enrollee fails to pay his or her premiums and the
entire grace period elapses, providers are allowed to seek payment for
the medical services they gave to that patient and for which the
insurance company did not reimburse claims.

Patient assistance programs: Some providers have expressed interest in
providing premium and cost-sharing assistance for their patients
enrolled in coverage through the Marketplaces. By helping their patients
maintain coverage and avoid the grace period in the first place,
providers hope to reduce the risk that medical claims for care they
provide will go unpaid.

However, questions continue to swirl about the legality of such an
approach. Although federal anti-kickback regulations might seem to
prohibit this type of practice, HHS has stated that such regulations do
not apply to the Marketplaces, their plans, and premium tax credits
because they are not considered "federal health care programs."

The ACA's uniform grace period could prove to play an important role in
keeping people enrolled in their plans. But big questions remain
unanswered about the financial risks to which physician practices or
hospitals could be exposed, as well as how much risk insurers face for
claims in the grace period and how that might affect premium growth for
all enrollees over time.

http://www.healthaffairs.org/healthpolicybriefs/brief.php?brief_id=128

****


Comment by Don McCanne

The Affordable Care Act provides a 90 day grace period during which
health care coverage through exchange plans is continued before insurers
can cancel the plans for non-payment of premiums. However, the insurers
must pay claims for only the first 30 days, whereas providers are not
allow to collect from the patient during the remaining 60 days. After 90
days of nonpayment of premiums, the patient can be retroactively billed,
though collection can be difficult since most of these patients do not
have enough funds to pay their premiums, much less their health care bills.

If you read the full Health Policy Brief, you will see that the issues
are even more complex. The 90 day rule is yet one more unnecessary
administrative burden that ACA added to our already highly complex
system of financing health care. Under a single payer system there would
be no such thing as a 90 day grace period. Financing of the health care
system would be as automatic as it is now with Medicare.

Thursday, October 16, 2014

Fwd: qotd: Will malpractice reform prevent “defensive medicine”?

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From: Don McCanne <don@mccanne.org>
To: Quote-of-the-Day <quote-of-the-day@mccanne.org>
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Subject: qotd: Will malpractice reform prevent "defensive medicine"?
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The New England Journal of Medicine
October 16, 2014
The Effect of Malpractice Reform on Emergency Department Care
By Daniel A. Waxman, M.D., Ph.D., Michael D. Greenberg, J.D., Ph.D., M.
Susan Ridgely, J.D., Arthur L. Kellermann, M.D., M.P.H., and Paul
Heaton, Ph.D.

Emergency department care has been a particular focus of a new
generation of malpractice reform laws. Approximately a decade ago, the
states of Texas (in 2003), Georgia (in 2005), and South Carolina (in
2005) changed their malpractice standard for emergency care to "willful
and wanton negligence" (in Texas) and "gross negligence" (in Georgia and
South Carolina). From a legal standpoint, these two standards are
considered to be synonymous and are widely considered to be a very high
bar for plaintiffs. Under typical interpretations of this standard, a
plaintiff must show that a physician had "actual, subjective awareness"
of "the likelihood of serious injury" but nevertheless proceeded with
"conscious indifference."

The Texas, Georgia, and South Carolina laws are intended to protect
physicians who are practicing with incomplete information in
high-intensity care settings. The enactment of these laws offers an
unusual circumstantial experiment with which to evaluate a type of
reform that is qualitatively different from what has been studied
previously.

Study Design

We used a quasi-experimental analytic approach that was designed to
evaluate the effect of legal reform on the treatment of Medicare
patients in the emergency department; we attempted to isolate the effect
of the law from temporal trends and from characteristics of patients and
hospitals (i.e., to evaluate changes that could be attributable to the
new policy).

Results

Malpractice reform was not associated with a significant decrease in CT
or MRI utilization in any of the three states. There was no significant
reduction in per-visit emergency department charges in Texas or South
Carolina. In Georgia, reform was associated with a 3.6% reduction (95%
confidence interval [CI], 0.9 to 6.2; P=0.01) in charges. There was no
reduction in the rate of hospital admissions in any of the three states.

Discussion

Malpractice reforms in Texas, Georgia, and South Carolina, which changed
the liability standard for emergency care from ordinary negligence to
gross negligence, provide unusually broad protection for emergency
physicians. We did not find evidence that these reforms decreased
practice intensity, as measured by the rate of the use of advanced
imaging, by the rate of hospital admission, or in two of three cases, by
average charges. Although there was a small reduction in charges in one
of the three states (Georgia), our results in aggregate suggest that
these strongly protective laws caused little (if any) change in practice
intensity among physicians caring for Medicare patients in emergency
departments.

In the context of the existing literature, our findings suggest that
physicians are less motivated by legal risk than they believe themselves
to be. Although a practice culture of abundant caution clearly exists,
it seems likely that an aversion to legal risk exists in parallel with a
more general risk aversion and with other behavioral, cultural, and
economic motivations that might affect decision making. When legal risk
decreases, the "path of least resistance" may still favor
resource-intensive care. Our results suggest that malpractice reform may
have less effect on costs than has been projected.

http://www.nejm.org/doi/full/10.1056/NEJMsa1313308

****


Comment by Don McCanne

When the topic of controlling health care costs comes up, those opposed
to single payer reform, and, for that matter, opposed to the Affordable
Care Act, frequently cite the need for malpractice reform, often
claiming that defensive medicine (ordering unnecessary tests and medical
interventions merely to prevent lawsuits) is a major cause of excess
health care spending. This article casts doubt that malpractice reform
would reduce supposed defensive medicine.

The three states studied - Texas, Georgia and South Carolina - passed
laws requiring a much more rigid standard of "gross negligence" for
emergency department physicians to be found liable for malpractice. Data
available from Texas demonstrates that their reforms did reduce
malpractice claim filings by 60 percent, and reduced malpractice
payments by 70 percent. Physicians were reassured that they were
protected as long as they did not proceed with "conscious indifference"
with care that had a "likelihood of serious injury."

Now that there was no longer a need for CT and MRI scans and hospital
admissions that were done only to prevent lawsuits, the level of these
presumed defensive medicine measures should have decreased. They did not.

This suggests that these measures were taken for reasons other than
simply to prevent lawsuits. A low yield test or procedure is not
necessarily a no yield intervention. These are done because there is a
real chance, even if at low odds, that the intervention may benefit the
patient.

This study leads us to conclude that the concept that there is excessive
resource-intensive care provided strictly as defensive medicine should
be abandoned and replaced with patient-centered outcomes research to
better determine what is of value in health care (PCORI in ACA is such
an attempt).

We should no longer allow ourselves to be distracted by false promises
of health care savings through flawed concepts such as defensive
medicine. We know what will greatly reduce wasteful spending, and that
is a single payer national health program. We must not be distracted
from trying to achieve that goal.

Wednesday, October 15, 2014

Fwd: qotd: States largely ignoring network inadequacies

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From: Don McCanne <don@mccanne.org>
To: Quote-of-the-Day <quote-of-the-day@mccanne.org>
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Subject: qotd: States largely ignoring network inadequacies
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Urban Institute
September 2014
Implementation of the Affordable Care Act: Cross-Cutting Issues
Six-State Case Study on Network Adequacy
By Sabrina Corlette, Kevin Lucia, and Sandy Ahn

During the transition to new health plans and new marketplaces under the
Affordable Care Act (ACA), many insurers revamped their approach to
network design, and many now offer narrower provider networks than they
have in the past. In this study for the Robert Wood Johnson Foundation's
project to monitor ACA implementation, researchers assessed network
changes and efforts at regulatory oversight in six states: Colorado,
Maryland, New York, Oregon, Rhode Island, and Virginia. Researchers
found that insurers made significant
changes to the provider networks of their individual market plans, both
inside and outside the marketplaces, and that insurers took varying
approaches to network design. Across all six states, insurers and state
officials alike reported consumer and provider confusion about which
plan networks included which providers, but most have received few
consumer complaints about their ability to obtain in-network services.
While three of the six states have taken action to improve provider
directories, it appears unlikely that state legislatures, officials and
regulators will dramatically change network adequacy standards, at least
in the short-term.

Conclusion

Insurers have used—and are likely to continue to use— network design to
curb costs and offer customers a more affordable premium. This was a
clear trend in the individual market as insurers approached the 2014
plan year, and some of our informants believe it will soon extend to the
group market as employers look for ways to reduce premiums. However,
despite concerns among some regulators, consumer advocates, and
providers that overly narrow networks could harm quality of care and
place consumers at significant financial risk, most of our study states
are not planning to significantly change their oversight of plan
networks. Though consumers reported problems with inaccurate provider
directories and a lack of consumer-friendly, comparable information
about the scope of plan networks, only half of our study states report
requiring insurers to improve the information made available to
consumers. At the same time, state officials and insurers also reported
that consumers were generally not complaining about difficulty obtaining
needed care from providers. Consequently, most state legislatures,
officials and regulators are unlikely to change network adequacy
standards, at least in the short-term.

http://www.urban.org/UploadedPDF/413240-Six-State-Case-Study-on-Network-Adequacy.pdf

****


Comment by Don McCanne

Private insurers use narrow networks of physicians and hospitals so that
they can negotiate more favorable provider rates which then supposedly
allows them to keep their insurance premiums more competitive. The
trade-off is that patients lose their choice of providers and increase
the risk that they will suffer severe financial penalties because of
unavoidable circumstances wherein care is obtained out of network, or
worse, care is not received at all because of impaired access.

The use of narrow networks will cause harm to many patients. Yet,
according to this report, for the present, "most state legislatures,
officials and regulators are unlikely to change network adequacy
standards." Also, although provider directories are notoriously
inaccurate, "only half of our study states report requiring insurers to
improve the information made available to consumers."

How much do the insurers really save by using narrow networks? The
savings is not the difference between the prices specified by the
providers and the amount contracted with the narrow network providers.
Insurers already receive sharp discounts from the providers in their
broad networks. So the savings is only the very modest additional amount
squeezed out of those who contract for the more exclusive narrower
networks. That savings is surely not worth the impaired access, loss of
choice, and potential financial hardship brought by narrow networks.

With a single payer system, fair payments apply to all physicians and
hospitals, therefore there is no need to establish separate networks.
The one network is the entire health care delivery system (except for
those who choose integrated delivery systems such as Kaiser Permanente).
Government administered pricing is far more patient friendly than
market-based manipulations, and isn't the patient what it is all about?