Analyzing Blue Cross Blue Shield Plan Administrative Costs

By Clive Riddle, June 13, 2019

Sherlock Company in the June issue of their Plan Management Navigator examines administrative cost trends for Blue Cross Blue Shield Plans, analyzing year end 2018 vs 2017 data.  They found that costs “increased by 5.5% per member, up from an increase of 5.1% for 2017. Reweighting to eliminate the effects of product mix differences between the years, per member costs increased by 6.7% as compared with 5.9% in 2017. ASO/ASC increased as commercial insured membership declined. Medicare Advantage continued to grow rapidly.”

 Their key findings included:

• Most clusters of expenses grew at rates less than last year.
• Uniquely, Account and Membership Administration’s growth rate increased.
• Growth in Information Systems was the single most important reason for administrative expense increase in 2018.
• The shift in favor of products and market segments that are lower cost to administer muted the real growth.

Sherlock’s benchmarking study “analyzes in-depth surveys of 14 Blue Licensees serving 37 million members. Surveyed Plans comprise 52% of the members of Blue Cross Blue Shield Plans not served by publicly-traded companies.” 

Why does this benchmarking matter? Because the non-publicly traded BCBS plans provide a meaningful universe to benchmark, and plan administrative expenses are highly scrutinized, and certainly more controllable than medical expenses. As Doug Sherlock states, “in the current environment, optimizing administrative expenses is a high priority for health plan managers. Plans have completed their adaptation to the Affordable Care Act and the bulge in Exchange and Medicaid members. Plus, administrative expense visibility has been heightened by the rhetoric of presidential candidates.”

Here’s some key specific data from their report:

• For the universe as a whole, the median total costs were $38.51 per member per month, higher than last year’s $34.99. 
• By functional area, median pmpm costs were: Sales & Marketing $9.21; Medical & Provider Management $5.03; Account and Membership Administration $16.10 and Corporate Services $5.92
• Median pmpm costs by product categories included: Commercial insured $49.84; Commercial ASO $28.32; Medicare Advantage $112.08; and Medicaid $46.08.
• The median administrative expense ratio was 9.0% compared with 8.9% last year.
• The median administrative expense ratio by product categories included: Commercial insured 10.8%; Commercial ASO 7.1%; Medicare Advantage 12.5%; and Medicaid 9.3%.
• Staffing ratios increased by 6.8%, especially in Information Systems. 
• Approximately 19 FTEs serve every 10,000 members in the commercial products. 
• Compensation, including all benefits except OPEB, increased at a median rate of 3.8%. 
• The median proportions of FTEs that were outsourced was 11.0%.
• After the effect of the Miscellaneous Business Taxes, total administrative expense PMPM increased by 17.9% compared with a decline of 2.3% in the prior year 

Consumer Surveys on SDOH Experiences: Kaiser, McKinsey and Waystar

By Clive Riddle, June 7, 2019 

Kaiser Permanente has just released results of consumer SDOH survey they commissioned entitled Social Needs in America, which found “68% of Americans surveyed reported they experienced at least one unmet social need in the past year. More than a quarter of those surveyed [28%] said that an unmet social need was a barrier to health, with 21% prioritizing paying for food or rent over seeing a doctor or getting a medication.”  In two other recent consumer SDOH survey reports, one [Waystar] found the same exact percentage [68%] reporting one or more unmet needs, while the other [McKinsey] found a lower figure [53%.] 

Here’s some of the Kaiser survey’s other detailed findings:

Respondents that frequently or occasionally experience stress include:

• 39%  over meeting their family’s needs for food/balanced meals;
• 38% over social relationships needs;
• 35% over meeting housing needs; and,
• 32% over transportation needs

Respondents believe these factors are important to overall health:

• stable housing (89%)
• balanced meals (84%)
• reliable transportation (80%); and
• supportive social relationships (72%) 

35% lack confidence that they could identify the best resource if they or a family member needed to use community resources relating to transportation, food, housing, or social isolation. 

42% would turn to their medical services provider when looking for information on community resources to help with social needs, and 30% would turn to their health insurance provider for this information.

Respondents are supportive of medical service providers assessing social needs;

• 93% say their medical provider should ask about access to
• food and balanced meals;
• 83% say their medical provider should ask about safe and stable housing;
• 78% say their medical provider should ask about social relationships and
• isolation; and
• 77% feel that their medical provider  should ask about transportation to work, school, appointments, or activities

Mckinsey examined consumer interest in SDOH offerings and how SDOH impacted healthcare utilization rates in their 2019 Consumer Social Determinants of Health Survey report, released in April, which found 53% reported they were adversely impacted by at least one SDOH factor, with food security being the most commonly reported unmet need (35%), followed by safety (25%) housing (21%) social support (17%) and transportation (15%). McKinsey found that 45% of respondents with unmet social needs reported high healthcare utilization, compared to 21% of respondents reporting no unmet needs. 85% of respondents indicated they would use a social program offered by their health plan.

Waystar released results of their consumer SDOH survey in December, finding:

• 68% of consumers have at least some level of SDoH challenge and 52% have a moderate to high SDoH risk in at least one category.
• Patients with SDoH issues are 2.5 times more willing to talk about those issues with clinicians than they are with payers
• Patients with high SDoH risk are more than 20 times more likely to miss a medical appointment at least once a month
• Medicare and Medicaid, have the largest high-stress share with 33 percent having high stress in three or more areas, compared to 21 percent of the commercial insurance population being "high risk."

Friday Five: Top 5 healthcare business news items from the MCOL Weekend edition

Every business day, MCOL posts feature stories making news on the business of health care. Here are five we think are particularly important for this week:

Why Some CEOs Figure ‘Medicare For All’ Is Good For Business 

Walk into a big-box retailer such as Walmart or Michaels and you’re likely to see MCS Industries’ picture frames, decorative mirrors or kitschy wall décor.

Kaiser Health News

Friday, June 7, 2019

U.S. Records 1,000th Case of Measles, Officials Blame Misinformation for Outbreak

The United States has recorded 1,001 measles cases so far this year in the worst outbreak of the highly contagious disease in more than a quarter-century, federal health officials said on Wednesday as they issued a new plea for parents to vaccinate their children.

NY Times

Thursday, June 6, 2019

Growing Hack of Health-Care Data Gets Scrutiny From Congress

A hack of health-care data involving a medical bill collector and two major diagnostics companies has grown to almost 20 million people, and is now attracting more questions from key members of Congress.

Bloomberg

Thursday, June 6, 2019

CVS to expand health hubs to 1,500 stores by end of 2021

CVS Health Corp said it would offer expanded health services such as nutrition counseling and blood pressure screenings in 1,500 stores by the end of 2021, following through on plans announced during the pharmacy chain’s 2018 acquisition of health insurer Aetna.

Reuters

Wednesday, June 5, 2019

Supreme Court rules against Obama-era provision on Medicare reimbursements 

The Supreme Court on Monday ruled that an Obama-era rule change on how Medicare reimbursements to hospitals are made should be removed because officials did not follow the proper notice and comment regulations in implementing the formula.

The Hill

Tuesday, June 4, 2019

These and more weekly news items on the business of healthcare are featured in the MCOL Weekend edition, along with the MCOL Tidbits, and more, for MCOL Premium level members.

ACA Exchange 2020 Final Rule Changes and Survey of Exchange Health Plan Participation and Expectations

By Clive Riddle, May 31, 2019 

Last month CMS issued their final rule with ACA benefit and payment parameters for 2020. Their changes for 2020 included: 

• The method for calculation of premium assistance for lower-income enrollees (projected to lower the total amount of financial assistance provided by $900 million, when compared with 2019, and result in 100,000 fewer exchange enrollees in 2020.)
• Allowing plans to make mid-year changes to their drug formularies
• Allowing plans to implement cost-sharing requirements if enrollees choose a brand-name drug when a medically appropriate generic version of the drug is available (even when out-of-pocket spending maximum is reached)
• Allowing plans to implement copayment accumulator programs for prescription drugs
• Lowering user fees for the 2020 coverage year by half a percentage point
• Increases maximum out-of-pocket spending limits by 3.2%, from $7,900 to $8,150 for individual plans and from $15,800 to $16,300 for family plans      

How will these changes, and overall market forces, impact health plan participation in the ACA exchanges for 2020? eHealth has just released survey results from 17 plans that collectively cover 80 million lives that participate in ACA exchanges, that found “more than twice as many insurers intend to increase plan offerings for 2020 as compared with 2019, with premiums holding fairly steady.”

Here’s some of their detailed findings: 

• 45% intend to add to the number of ACA plans they'll offer in 2020, compared to 21% who did so for the 2019 plan year
• 42% expect to raise premiums between 5 and 10 percent over 2019 rates. 33% do not expect to make any noteworthy changes to premiums, while 23% expect to reduce monthly premiums by 5 percent or more.
• 69% said that sales during the last open enrollment period were within 10 percent of their expectations. 15% reported that sales outpaced expectations by 10 to 15 percent, while another 15% of said sales were 10 percent or more below expectations.
• 71% said they are paying attention to public discussions about "Medicare for all" but don't expect major changes, compared to 67% in 2018

Friday Five: Top 5 healthcare business news items from the MCOL Weekend edition

Every business day, MCOL posts feature stories making news on the business of health care. Here are five we think are particularly important for this week:

Prescription Drug Spending Varies by Private, Public Payers

Total prescription drug spending reached $333 million in 2017, but the way that lump sum was divided among Medicare, Medicaid, and employer-sponsored health plans may reveal differences between the populations each payer covers, according to a May analysis from the Kaiser Family Foundation (KFF).

HealthPayer Intelligence

Thursday, May 30, 2019

Executive order may leave out disclosure of negotiated rates

After intense opposition from health care stakeholders, sources say language calling for disclosure of rates negotiated between insurers and health care providers could be dropped from the final version of a Trump administration executive order on health care price transparency that is expected to be announced by mid-June.

Washington Post

Thursday, May 30, 2019

Report from The Leapfrog Group Finds Only 1 in 5 U.S. Hospitals Fully Meet Payor Standards for Maternity Care

The Leapfrog Group, a national watchdog organization of employers and other purchasers focused on health care safety and quality, today released its 2019 Maternity Care Report.

The Leapfrog Group

Wednesday, May 29, 2019

5 names to know at Facebook: the people behind its push into health care

When it comes to building out a health business, Facebook is often seen as having much more modest ambitions than its Big Tech competitors.

Stat News

Wednesday, May 29, 2019

J&J's Greed Helped Spawn Opioid Epidemic Oklahoma’s AG Argues

Johnson & Johnson’s greed for more sales of its addictive opioid painkillers helped create a deadly epidemic in Oklahoma that claimed thousands of lives, and the company should pay billions of dollars as compensation, the state’s top law-enforcement officer told a judge.

Bloomberg

Wednesday, May 29, 2019

These and more weekly news items on the business of healthcare are featured in the MCOL Weekend edition, along with the MCOL Tidbits, and more, for MCOL Premium level members.

Friday Five: Top 5 healthcare business news items from the MCOL Weekend edition

Every business day, MCOL posts feature stories making news on the business of health care. Here are five we think are particularly important for this week:

House leaders propose restructuring Medicare Part D

U.S. House of Representatives health committee leaders have drafted new reforms to Medicare Part D as Congress prepares for a final legislative sprint on drug pricing.

Modern Healthcare

Friday, May 24, 2019

Bipartisan senators reveal sweeping health care package

A sweeping draft legislative package from the bipartisan leaders of the Senate Health Committee seeks to lower health care costs by addressing surprise medical bills and adding transparency to drug prices, among other provisions.

The Hill

Friday, May 24, 2019

CBO: Medicare for All gives 'many more' coverage but 'potentially disruptive'

Experts from Congress’s nonpartisan budget office testified Wednesday that a single-payer health care system would result in “many more” people with health insurance but would also be “potentially disruptive” and increase government control.

The Hill

Thursday, May 23, 2019

Measles outbreak spreads to 24 states

The number of measles cases in the United States climbed again this week, bringing the number to 880 cases across 24 states, according to the Centers for Disease Control and Prevention (CDC).

The Hill

Tuesday, May 21, 2019

Poll: Many Rural Americans Struggle with Financial Insecurity, Access To Health Care

Polling by NPR finds that while rural Americans are mostly satisfied with life, there is a strong undercurrent of financial insecurity that can create very serious problems for many people living in rural communities.

NPR

Tuesday, May 21, 2019

These and more weekly news items on the business of healthcare are featured in the MCOL Weekend edition, along with the MCOL Tidbits, and more, for MCOL Premium level members.

The Health Tech Our Toddlers Should Never Know

by Kim Bellard, May 23, 2019

Joanna Stern wrote a fun article for The Wall Street Journal: "The Tech My Toddler Will Never Know: Six Gadgets Headed for the Graveyard."  My immediate thought was about health tech's equivalent list.  There certainly is a lot of health tech that should be headed to the graveyard, but, knowing healthcare's propensity to hang on to its technology way too long, I had to modify her more optimistic headline to say "should" instead of "will."

One can always hope.  Here's my healthcare tech list:

1.  Faxes:  You knew it had to be at the top of the list.  Anyone under thirty who knows how to work a fax machine probably works in healthcare.  The reason faxes persist is because they supposedly offer some security advantages, but one suspects inertia plays at least a big a role. There are other options that can be equally "secure," while making the information digital. 

2.  Phone Trees:  We've all had to call healthcare organizations -- doctors' offices, testing facility, health plans, etc.  Most times, you first have to navigate a series of prompts to help specify why you are calling, presumably to get you closer to the right person.  There are probably studies that show it saves money for the companies that use them, and perhaps some that even claim its saves customers time, but this is not a technology most people like. By 2030 I want my AI -- Alexa, Siri, etc. -- to deal directly with the companies' AI to spare me from phone trees. 

3.  Multiple health records: I have at least five distinct health records that I know of, only two of which communicate to the other at all.  For people with more doctors and/or more complex health issues, I'm sure the situation is even worse.  EHRs are old technology, the cable of healthcare.  By 2030, we should each have a single health record that reflects the broad range of our health.

4.  Stethoscopes:   You've seen them. Your doctor probably has one.  Find the oldest photographs of doctors that exist and you might find them with stethoscopes; they are that old.” It's not that they are useless, but as it is that there are better alternatives, such as handheld ultrasounds or even smartphone apps.  For Pete's sake, people are working on real-life tricorders.   By 2030, seriously, can we be using its 21st century alternatives?  

5.  Endoscopes: Perhaps you've had a colonoscopy or other endoscopic procedure; not much fun, right?  We do a lot of them, they cost a lot of money (at least, in the U.S.), and they involve some impressive technology, but they're outdated. By 2030, we should be using things like ingestible pill cameras, with ingestible robots to take any needed samples or even conduct any microsurgery. 

6.  Chemotherapy: Chemotherapy is literally a lifesaver for many cancer patients, and a life-extender for many others.  We're constantly getting new breakthroughs in it, allowing more remissions or more months of life.  But it can pose a terrible burden -- physically, emotionally, and financially -- on the people getting it.  Chemotherapy has been likened to carpet bombing, with significant collateral damage.  Increasingly, there are alternatives that are more like "smart bombing" -- precision strikes that target only cancer cells, either killing or inhibiting them.  By 2030, perhaps cancer patients won't fear the treatments almost as much as the cancer.

Healthcare certainly has no shortage of technology that we should hope today's toddlers will never have to use or experience.  The above are just six suggestions, and you may have your own examples.  We can make these happen, by 2030; the question is, will we?

This post is an abridged version of the posting in Kim Bellard’s blogsite. Click here to read the full posting.

The Short List of Major Healthcare Implications from A Declining Birth Rate

By Clive Riddle, May 17, 2019

Like most of the industrialized world. the U.S. birth rate is declining, as evidenced in the new  CDC National Center for Health Statistics National Vital Statistics System May 2019 report on "Births: Provisional Data for 2018."  (the final birth report is scheduled to come out this fall.) The big news from the report is the number of births was the lowest in 32 years, and the fertility rate reached another record low.

Here's highlights from the report: 

• The provisional number of births for the United States in 2018 was
• 3,788,235, down 2% from 2017 
• The general fertility rate was 59.0 births per 1,000 women aged 15–44, down 2% from 2017 a
• The total fertility rate declined 2% to 1,728.0 births per 1,000 women in 2018
• Birth rates declined for nearly all age groups of women under 35, but rose for women in their late 30s and early 40s
• The birth rate for teenagers aged 15–19 was down 7% in 2018 to 17.4 births per 1,000 women
• Rates declined for both younger (aged 15–17) and older (aged 18–19) teenagers
• The cesarean delivery rate decreased to 31.9% in 2018; the low-risk cesarean delivery rate decreased to 25.9%
• The preterm birth rate rose for the fourth year in a row to 10.02% in 2018
• The 2018 rate of low birthweight was unchanged from 2017 (8.28%)

In a Q&A session with report author Brady E. Hamilton, Ph.D. posted in the NCHStats blog, Hamilton is asked if there was a specific finding that surprised him, which he replied "the record lows reached for the general fertility rate, the total fertility rate and birth rates for females aged 15-19, 15-17, 18-19, and 20-24 are noteworthy. In addition, the magnitude of the continued decline in the birth rate for teens aged 15-19, down 7% from 2017 to 2018, is also historic." Hamilton was non-committal about the trend going forward, stating “these data do not answer the question of why the number of births dropped in 2018 or if the decline will continue.”

But assuming the trends do continue, which certainly the opinion of many, there are certainly major implications for healthcare, including this short-list: 

• Impact of reduced demand for hospital and physician OB services
• Impact of increased births from higher-age mothers, with greater care complexities involved
• Longer range reduced demand for hospital and physician pediatric services
• Longer range reduced available Medicare funding from employed workforce, with growing imbalance of senior retired population compared to working population

Friday Five: Top 5 healthcare business news items from the MCOL Weekend edition

Every business day, MCOL posts feature stories making news on the business of health care. Here are five we think are particularly important for this week:

As ER Wait Times Grow, More Patients Leave Against Medical Advice

Emergency room patients increasingly leave California hospitals against medical advice, and experts say crowded ERs are likely to blame.

Kaiser Health News

Friday, May 17, 2019

CMS takes aim at spread pricing in Medicaid managed care

The Centers for Medicare & Medicaid Services issued an information bulletin (PDF) on the calculations for a Medicaid managed care plan’s medical loss ratio, as the agency is concerned insurers aren’t accurately including pharmacy benefit manager spread pricing in those calculations.

Fierce Healthcare

Wednesday, May 15, 2019

Will Washington State's New 'Public Option' Plan Reduce Health Care Costs? 

Millions of Americans who buy individual health insurance, and don't qualify for a federal subsidy, have been hit with sticker shock in recent years.

NPR

Friday, May 17, 2019

Low-rated US hospitals are deadlier due to mistakes, botched surgery, infections 

Patients' risk of dying from medical mistakes, deadly infections and safety lapses have gotten much worse at the lowest ranked U.S. hospitals, underscoring Americans' need to check ratings of their local hospitals, new research released Wednesday shows.

USA Today

Thursday, May 16, 2019

Walmart Charts New Course By Steering Workers To High-Quality Imaging Centers 

Walmart Inc., the nation’s largest private employer, is worried that too many of its workers are having health conditions misdiagnosed, leading to unnecessary surgery and wasted health spending.

Kaiser Health News

Wednesday, May 15, 2019

These and more weekly news items on the business of healthcare are featured in the MCOL Weekend edition, along with the MCOL Tidbits, and more, for MCOL Premium level members.

Consumer Insights and Kaiser Initiative on SDOH

By Clive Riddle, May 10, 2019

McKinsey has just published various insights from their 2019 Consumer Social Determinants of Health Survey, which found that compared to those whose social need is met, respondents (2,010 surveyed with government program coverage or uninsured and below 250% of federal poverty level) that:

• Reported food insecurity were 2.4 times more likely to report multiple ER visits, and 2,0 times more likely to be hospitalized
• Reported unmet transportation needs were 2.6 times more likely to report multiple ER visits, and 2,2 times more likely to be hospitalized
• Reported unmet community safety needs were 3.2 times more likely to report multiple ER visits

Encouraging news from the survey for health plan advocates of SDOH was that 85% of respondents reporting unmet social needs said they would use a social program offered by their health insurer. Regardless of their social needs, respondents were interested in these types of health plan SDOH programs as follows: 

• 50% were interested in grocery store discounts for healthy foods
• 48% were interested in free memberships at local gyms
• 45% were interested in a wellness dollar account used towards wellness services of their choice
• 41% were interested in total reimbursement of home improvement purchases to address health issues
• 40% were interested in after-hours drop-in clinics at lower or no cost 

Speaking of health plans, Kaiser Permanente has just announced their new Thrive Local initiative, a “a social care coordination platform” with “a network of public agencies and community-based organizations that will support” Kaiser “members to meet their social needs.”

Kaiser says that “starting this summer, closed-loop and bidirectional communication will provide confidence that referral, follow-up and ongoing patient/family engagement happen. Improved cross-sector collaboration and communication will also reduce the unintentional trauma and stigma that our patients and families may experience. Beyond Kaiser Permanente members and patients, community-based organizations will also benefit through improved decision support, automation, and relevance of the referrals they receive from their health system. This connectivity and interoperability between health care and social organizations and agencies will redefine the meaning of ‘provider network’ in this new world as the network of providers of health, health care, and social needs to address total health of our communities.”

Kaiser Permanente is partnering with Unite Us to launch the program, as tells us that Thrive Local within three years “will be available to all of Kaiser Permanente’s 12.3 million members and the 68 million people in the communities Kaiser Permanente serves.

CBO: Coverage by Oration

by Clive Riddle, May 3, 2019

 The Congressional Budget Office has been quite busy as of late, preparing reports that can serve as reference resources in response to Orators residing in Congress, the White House and the campaign trail, that are espousing healthcare coverage policy proposals, whether those proposals being orated involve Medicare for All, Medicare for Some, Death to the ACA, or other such schemes.

On May 1^st, the CBO released a 34-page report:  Key Design Components and Considerations for Establishing a Single-Payer Health Care System, serving as a roadmap that “describes the primary features of single-payer systems, and it discusses some of the design considerations and choices that policymakers will face in developing proposals for establishing such a system in the United States.”

The report is organized by these categories of components and design considerations: 

• How would the government administer a single-payer health plan?
• Who would be eligible for the plan, and what benefits would it cover?
• What cost sharing, if any, would the plan require?
• What role, if any, would private insurance and other public programs have?
• Which providers would be allowed to participate, and who would own the hospitals and employ the providers?
• How would the single-payer system set provider payment rates and
• purchase prescription drugs?
• How would the single-payer system contain health care costs?
• How would the system be financed? 

In May 2^nd, the CBO released a 42-page report: Federal Subsidies for Health Insurance Coverage for People Under Age 65: 2019 to 2029, which “project that federal subsidies, taxes, and penalties associated with health insurance coverage for people under age 65 will result in a net subsidy from the federal government of $737 billion in 2019 and $1.3 trillion in 2029.”

 The report tells us that:

• Between 240- 242 million people are projected to have health insurance each month during 2019-2029. The number of uninsured is projected to rise from 30 million in 2019 to 35 million in 2029.
• Net federal subsidies for insured people will total $737 billion in 2019 and $1.3 trillion in 2029.
• Medicaid and CHIP account for 40 - 45 percent of the federal subsidies, Medicare accounts for about 10 percent, and subsidies for ACA marketplace coverage account for less than 10 percent.

On April 18^th the CBO provided a blog post: CBO Releases Four Products Explaining How Its New Health Insurance Simulation Model Works that describes how they generate estimates of health insurance coverage and premiums for the population under age 65, such as for the May 2md Federal Subsidies report.

 Also on April 18^th, the CBO released an 11-page report:  Health Insurance Coverage for People Under Age 65:  Definitions and Estimates for 2015 to 2018 that “explains how CBO defines health insurance coverage, describes how CBO combines data from various sources to produce estimates of different types of coverage in past years, and shows such estimates for the years 2015 to 2018.” 

The report:  

• Describes how CBO defines health insurance coverage (private and public) for people under 65 who are not institutionalized and who are not members of the active-duty military;
• Describes the individual data sources CBO uses to compile preliminary estimates of historical outcomes, and the limitations of those sources; and
• Compares preliminary estimates of historical outcomes with CBO’s integrated estimates of coverage (that are consistent with each other and that sum to accurately depict the total population) for 2015 to 2018.

Friday Five: Top 5 healthcare business news items from the MCOL Weekend edition

Every business day, MCOL posts feature stories making news on the business of health care. Here are five we think are particularly important for this week:

Most Americans grateful for their job's health coverage, but still struggle with healthcare costs

Most people with employer-sponsored insurance are generally happy with their health plans, but many still struggle with healthcare affordability, according to a Kaiser Family Foundation/Los Angeles Times survey.

Becker's Hospital Review

Friday, May 3, 2019

Insys’s John Kapoor Is First CEO Convicted of Opioid Racketeering

Insys Therapeutics Inc. founder John Kapoor was convicted of a racketeering conspiracy that drove sales of a highly addictive opioid while contributing to a nationwide epidemic.

Bloomberg

Friday, May 3, 2019

Budget office: Caveats to government-run health system

Congressional budget experts said Wednesday that moving to a government-run health care system like “Medicare for All” could be complicated and potentially disruptive for Americans.

AP News

Thursday, May 2, 2019

Medicaid Work Requirements Hit Roadblocks

Toward the end of 2018, the Trump administration seemed to be marching briskly toward its goal of requiring able-bodied adults in Medicaid to prove they had jobs to participate in the public health plan for the poor.

Pew Trust

Wednesday, May 1, 2019

Officials declare measles outbreak in Pacific Northwest over

A measles outbreak that sickened more than 70 people, mostly children, in the Pacific Northwest is finally over even as the total number of cases nationwide continues to spike to near-record levels, officials said Monday.

AP News

Tuesday, April 30, 2019

These and more weekly news items on the business of healthcare are featured in the MCOL Weekend edition, along with the MCOL Tidbits, and more, for MCOL Premium level members.

Friday Five: Top 5 healthcare business news items from the MCOL Weekend edition

Every business day, MCOL posts feature stories making news on the business of health care. Here are five we think are particularly important for this week: 

Medicaid, CHIP enrollment for kids dropped by 861,000 in 2018

An estimated 861,000 fewer children were covered by Medicaid and the Children's Health Insurance Program in 2018 compared with the year before, according to an analysis by Georgetown University's Center for Children and Families drawing on new CMS data.

Thursday, April 25, 2019 

Anthem Beats Earnings Estimates, Outlines Plans for Pharmacy Benefits Unit

Anthem Inc on Wednesday posted a better-than-expected quarterly profit and laid out its plans to transition most customers to its revamped pharmacy benefits business this year.

NY Times

Thursday, April 25, 2019

Pharma Lobby Nears Spending Records With Drug Prices Under Fire

Large drug makers and the industry’s primary trade group neared previous spending records on lobbying in the first three months of the year as President Donald Trump and Congress increased pressure to rein in the cost of medicine.

Bloomberg

Tuesday, April 23, 2019 

More than 1 million Americans have lost health insurance since 2016

More than 1 million Americans have lost health insurance coverage since 2016, according to a new report from the Congressional Budget Office (CBO).

The Hill

Monday, April 22, 2019 

Hospitals Stand to Lose Billions Under ‘Medicare for All’

For a patient’s knee replacement, Medicare will pay a hospital $17,000. The same hospital can get more than twice as much, or about $37,000, for the same surgery on a patient with private insurance.

NY Times

Monday, April 22, 2019 

These and more weekly news items on the business of healthcare are featured in the MCOL Weekend edition, along with the MCOL Tidbits, and more, for MCOL Premium level members.

Robots Need DNA Too

by Kim Bellard, April 22, 2019 

DNA, it seems, never ceases to amaze. Now scientists are using it to create new kinds of "lifelike" mechanisms.   Pandora, we may have found your box. 

Researchers from Cornell recently reported on their advances.  They used something called DASH -- DNA-based Assembly and Synthesis of Hierarchical -- to create "a DNA material with capabilities of metabolism, in addition to self-assembly and organization – three key traits of life."

That sends chills up my spine, and not necessarily in a good way. 

Lead author Shogo Hamada elaborated:

The designs are still primitive, but they showed a new route to create dynamic machines from biomolecules. We are at a first step of building lifelike robots by artificial metabolism.  Even from a simple design, we were able to create sophisticated behaviors like racing. Artificial metabolism could open a new frontier in robotics.

The reference to racing in his quote refers to the fact their mechanisms were capable to motion -- likened to how slime mold moves -- and they literally had their "lifelike materials" racing each other.  If I'm reading the research paper correctly, the mechanisms were even capable of hindering their competitor."

Well, that's lifelike, all right.

It wasn't all days at the race track; oh-by-the-way, they also demonstrated its potential for pathogen detection, which sounds like it could prove pretty useful.

These mechanisms eat, grow, move, replicate, evolve,and die.  Dr. Luo says: "More excitingly, the use of DNA gives the whole system a self-evolutionary possibility.  That is huge."  Dr. Hamada adds: "Ultimately, the system may lead to lifelike self-reproducing machines."

Those chills are back.

There has been a lot of attention on engineering advances that will allow for nanobots, including uses with our bodies and so-called "soft robots," but we should be given equal attention to what is called synthetic biology.

Synthetic biology isn't necessarily or even predominately about creating new kinds of biology, as the researchers at Cornell are doing, but reprogramming existing forms of life. They're being programmed to eat CO2 (thus helping with global warming), help with recycling, get rid of toxic wastes, even make medicines. 

A Columbia researcher believes that new techniques for programming bacteria, for example, "will help us personalize medical treatments by creating a patient’s cancer in a dish, and rapidly identify the best therapy for the specific individual."

In the not-too-distant future, we're going to be programming lifeforms and "lifelike materials" to do our bidding at the molecular or cellular level.  We've been debating and worrying about when A.I. might become truly intelligent, even self-aware, but the Cornell research is giving us something equally profound to debate: how to draw the line between "life" and "things"?

Medicine, healthcare, and health are going to have to develop more 21st century versions.  What we've been doing will look like brute force, human-centric approaches.  Synthetic biology and molecular engineering open up new and exciting possibilities, and some of those possibilities will upend the status quo in healthcare in ways we can barely even imagine now.  

It's not going to be enough to think of new approaches.  We're going to have to find new ways to even think about those new approaches.  
  
In the meantime, let's go watch some DASH dashes!

This post is an abridged version of the posting in Kim Bellard’s blogsite. Click here to read the full posting. 

Five Sterile Processing Questions for Stephen Cuthbertson, College Medical Center and Jeremy Gibson-Roark, DNV GL Healthcare: Post-Webinar Interview

By Claire Thayer, April 18, 2019

Improvement, Regulatory Compliance & Case Management of College Medical Center in Long Beach California, and Jeremy Gibson-Roark, a lead clinical and certification surveyor with DNV GL Healthcare, participated in a Healthcare Web Summit discussion on sterile processing.

If you missed this informative webinar, Is Your Sterile Processing Department Safe? Risks and Opportunities in Sterile Processing, watch the On-Demand version here. After the webinar, we interviewed Stephen and Jeremy on five key takeaways from the webinar: 

1. What are a few of the opportunities you've identified in sterile processing departments for quality improvement? 

Jeremy Gibson-Roark: 

• IUSS use
• Tray Completion – All instruments accounted for and delivered
• Instrument Quality
• Instrument/Set Availability
• Tray Management – Removing and repurposing of trays not being utilized
• Tray Management – Condensing of trays to reduce volume of processing  

2. How does the certification in sterile processing benefit the patient? 

Jeremy Gibson-Roark: It allows an organization to ensure that a Quality Management System (QMS) is in place in the sterile processing department.  This system should be designed to achieve continual improvement in the department.  The benefit to the patient is the assurance that the organization has dedicated the resources and leadership to the processing of surgical/medical instrumentation. 

3. Why were you interested in obtaining Sterile Processing Program Certification for your hospital? 

Stephen Cuthbertson: We wanted a certification to set us apart from our local area hospitals. After review of the SPPC standards, we felt confident we could achieve the certification. We don’t have the volume for attempting, stroke, VAD, or hip and knee, etc… 

4. What are some of the key steps involved in the certification process? 

Stephen Cuthbertson: I think the biggest key steps are first understanding that the standards speak to and expect to see data, policies, QMS, etc.., specific to the SPD. The document review is extensive and the tour of the various departments affected by SPD are the other big steps. It’s also important to realize that the nonconformities aren’t a bad thing, they assist the organization in improving their patient safety related to SPD. 

5. Is certification only available for Hospital? 

Jeremy Gibson-Roark: This is the only certification available for the Sterile Processing Department in the United States. While individual certification is available through other organizations, DNV GL is the only organization that will certify a hospitals SPD.

CVS Caremark PBM Releases Its Own Report Card and Gives Itself A’s

by Clive Riddle, April 12, 2019

CVS Health’s Caremark PBM has just released their annual Drug Trend Report, and tells is that they “blunted the impact of drug price inflation achieving a negative -4.2 percent price growth for non-specialty drugs and a 1.7 percent price growth for specialty drugs. Furthermore, 44 percent of CVS Caremark's commercial PBM clients saw their net prescription drug prices decline from 2017 to 2018.”

In the 12-page report, CVS Caremark notes that while medical costs have increased by 14% since 2013, their member average cost per 30-day Rx decreased 8.4% during that time, from, $11.96 to $10.95. They also remind us Non specialty brand AWP increased 8.1% last year, and specialty brand AWP increased 7.6% last year, while overall U.S. inflation increased 1.9%.

CVS Caremark reports that specialty drugs account for 1% of their Rxs, but 45% of their pharmacy spend.  They cite specialty drug cost growth as the number one trend to keep on your radar going forward. The rest of the top five trends:

2) Integrated management of specialty drug spend that falls under the medical benefit, given 45% of the specialty spend falls under medical benefits

3) Addressing pharma manufacturer innovations in marketing and product protection to reduce market competition

4) Strategies to improve medication adherence for chronic disease patients

5) Identifying “bad actors” through analytics

Got $285k for Healthcare Costs in Your Retirement Years?

By Clive Riddle, April 5, 2019

West Health and Gallup this week released a 44-page report: The U.S. Healthcare Cost Crisis, with survey results that addressed “the impact of the high cost of healthcare on personal finances, individual healthcare choices and the level of satisfaction with the U.S. healthcare system.”

The survey found “that despite 45% of respondents reporting fears of bankruptcy if a major health event strikes, 1 in 4 skipping a medical treatment due to costs and Americans collectively borrowing an estimated $88 billion to cover healthcare costs in the past year.” The report also tells us that: 

• When given the choice between a freeze in healthcare costs for the next five years or a 10% increase in household income, 61% of Americans report that their preference is a freeze in costs
• 76% expect their costs for healthcare will increase even further in the next two years
• 26% have deferred a treatment
• 12% borrowed money to pay for healthcare in the past year, including nearly 3 million borrowing $10,000 or more
• 23% cut back on household spending due to healthcare costs
• Only 36% of  doctors discuss costs with them in advance of procedures, tests or treatment plans, and 34% discussed costs of prescriptions 

But the concern rightfully is heightened for seniors (age 65+) who have the most immediate and more complex healthcare needs overall, and finite financial resources: 

• 31% of seniors will be unable to pay for basic healthcare in the next 12 months (41% with annual household income <$60,000)
• 29% will be unable to pay for medicine in the next 12 months (42% with annual household income <$60,000)
• 38% said a major health event could lead to bankruptcy 38%  (45% with annual household income <$60,000) 

Fidelity this week released their annual analysis of out of pocket Medicare expenses and funds required for medical expenses with a couple retiring today. 

According to Fidelity, “a 65-year old couple retiring in 2019 can expect to spend $285,000 in health care and medical expenses throughout retirement, compared with $280,000 in 2018. For single retirees, the health care cost estimate is $150,000 for women and $135,000 for men.” Fidelity tells us that “while there’s no surprise that health care costs are a top financial concern in retirement, the past two years combined have seen a slower rise (3.6 percent) than in the previous two (2015-2017), which saw the estimate grow to $275,000 from $245,000 (up a total of 12.2 percent). Even without the same rate of growth, some retirees are still surprised by today’s cost of health care.” 

Fidelity healthcare prescription isn’t surprising – they advocate building savings to cover the expenses, through HSAs:

Friday Five: Top 5 healthcare business news items from the MCOL Weekend edition

Every business day, MCOL posts feature stories making news on the business of health care. Here are five we think are particularly important for this week: 

Average prices higher for outpatient healthcare, study finds

Commercially insured patients face higher prices for a set of healthcare services performed in outpatient settings compared to those at physician offices, according to a Health Care Cost Institute study.

Becker's Hospital Review

Thursday, April 4, 2019 

Insurers, hospitals, physicians united in stance on ACA lawsuit

Hospitals, physicians and insurer groups are united in wanting to preserve the Affordable Care Act and have defended it in briefs filed with the Fifth Circuit Court of Appeals.

Healthcare Finance News

Wednesday, April 3, 2019 

Fixing Surprise Medical Bill Problem Shouldn’t Fall To Consumers, Panel Told

One point drew clear agreement Tuesday during a House subcommittee hearing: When it comes to the problem of surprise medical bills, the solution must protect patients — not demand that they be great negotiators.

Kaiser Health News

Wednesday, April 3, 2019 

CMS, states face difficult choices on Medicaid expansion, work requirements

The Trump administration and many states face a complex set of policy decisions in the wake of a federal judge’s decision vacating Medicaid work requirement waivers in Kentucky and Arkansas.

Modern Healthcare

Tuesday, April 2, 2019 

Association Health Plan Ruling Puts Some Companies in Limbo

A federal judge's ruling against a type of health insurance plan designed for small business owners has some companies now thinking about what to do next.

Associated Press

Tuesday, April 2, 2019 

These and more weekly news items on the business of healthcare are featured in the MCOL Weekend edition, along with the MCOL Tidbits, and more, for MCOL Premium level members.

Five Questions for Change Healthcare's Chris Simpkins and Dr. Andrei Gonzales

By Claire Thayer, March 29, 2019

Recently, Change Healthcare’s Chris Simpkins, Vice President Value Based Analytics and Dr. Andrei Gonzales, Assistant Vice President, VBR Product Management, participated in a Healthcare Web Summit webinar and shared some of the many ways in which episode analytics can be used by Managed Medicaid plans to drive improved care quality and lower total costs of care. 

If you missed this informative webinar presentation, “Creating Value Based Payment Success in Managed Medicaid Through Analytics,” we invite you to view a PDF version of the presentation! To do so, go to: www.healthwebsummit.com/changehealthcare031419.pdf.

After the webinar, we interviewed Mr. Simpkins and Dr. Gonzales on five key takeaways from the discussion:

1. Tell us more about Change Healthcare's recommendation to starting a Value-Based Payment Program with an upside only financial incentive and then gradually move toward an upside / downside program at a later stage?

Chris Simpkins: A value-based payment program should be approached as a crawl walk run process.  Historically, payers and providers have been on opposite sides of the negotiation table.  For one side to win… the other side needs to lose.  Value based payment programs are a shared success & responsibility program. Payers and Providers will win or lose together.  This new collaborative relationship needs time to grow and develop trust. 

Health plans need time to be more comfortable sharing data with providers about what happens outside their offices.  Providers need time to be more comfortable understanding the new financial models (i.e the the rewards & risks of these programs).  Upside only programs allow payers and providers the time they need to focus on their collaborative relationship and the structure of the program without the fear of harsh downside penalties.  As the relationship grows and provider gets more comfortable with how to succeed, downside risk can be introduced.

2. Your discussion illuminated opportunities to leverage episodes in a Medicaid population, and in particular, pregnancy management. How is a Pregnancy Program similar to procedural bundles (i.e., Total Joint Replacement)?

Chris Simpkins: Pregnancy is like a procedural bundle because a large portion of the services within the episode are predictable and clearly related to the underlying trigger event.  Each episode includes prenatal visits, ultrasounds and delivery costs.  This consistency in services allows payers and providers greater accuracy in setting budgets for performance tracking and shared savings programs.  This consistency also allows you to conduct peer to peer comparisons which helps identify variations in care that can lead to higher costs and lower quality.

3. What are some of the key findings from your recent payer survey as to drivers leading Value Based Care program care adoptions? 

Dr. Gonzales: Based on our most recent research we identified four key factors driving payer interest in value-based care programs.

1)      Medical Cost Savings – Payers identified an average medical costs savings of 5.6% from the their VBC Strategies

2)      Care Quality Improvements – 77% of payers responded felt their VBC programs were either improving care quality

3)      Improved Patient and Provider Engagement – More than 64% of respondents noted that their VBC efforts were improving key stakeholder engagement

4. In your experience, what are the top 3 provider engagement challenges in episode of care management?

Dr. Gonzales: Payers continue to struggle to secure provider support for their episode of care programs.   The top three provider engagement challenges identified include:

1)      Gaining agreement on contracted budgets and risk/gain sharing

2)      Gaining agreement on episode of care performance metrics and reports

3)      Engaging providers to consider participating in an episode of care contract 

5. Can you tell us briefly about ways in which population differences between Medicare, Commercial and Medicaid require different approaches with Episodes of Care?

Chris Simpkins: These three populations have very different healthcare needs and access the healthcare system in different ways.  The Medicare population is older and accesses the healthcare system for procedural (i.e. Joint Replacement) and Acute (Stroke, AMI).  55% of Medicare dollars are spent treating these conditions.  The Medicaid population is younger, lower socioeconmic and more female.  This produces higher medical spend for Maternity care, Chronic diseases such as Ashtma, ADHD, Diabetes.  Very little is spent on procedural episodes.  These chronic diseases are not as well suited for an episode program with a fixed budget for treating a single condition.  Total Cost of Care models centered around a PCP that focus on comorbid conditions are better suited for treating these types of conditions.  The Commercial population blends the two, there are procedurals in the older portions of the population (e.g. 55-64), maternity costs for young working families and also Chronic diseases that are prevalent in all populations.

Friday Five: Top 5 healthcare business news items from the MCOL Weekend edition

Every business day, MCOL posts feature stories making news on the business of health care. Here are five we think are particularly important for this week: 

Ruling creates uncertainty for states’ Medicaid work rules

The governor whose state is at the center of the fight over work requirements for Medicaid recipients said Thursday he wants to fight a judge’s ruling blocking those rules, while Republicans elsewhere are trying to determine the decision’s effect on their state.

Seattle Times

Friday, March 29, 2019 

Trump administration suffers another Obamacare blow in court

The Trump administration has lost another Obamacare legal battle — its second this week — just as the president has revived his drive to destroy and replace the 2010 health law.

Politico

Friday, March 29, 2019 

Centene to buy smaller rival WellCare Health Plans in deal worth $17.3 billion

Major U.S. health insurer Centene will purchase government-sponsored health-care provider WellCare Health Plans in a cash and stock deal valued at $17.3 billion.

USA Today

Friday, March 29, 2019 

Medicaid Expansion Boosts Hospital Bottom Lines — And Prices

The Medicaid expansion promoted by the Affordable Care Act was a boon for St. Mary’s Medical Center, the largest hospital in western Colorado. Since 2014, the number of uninsured patients it served dropped by more than half, saving the nonprofit hospital more than $3 million a year.

Kaiser Health News

Wednesday, March 27, 2019 

Purdue Pharma settles with Oklahoma in landmark opioid lawsuit

Purdue Pharma and the state of Oklahoma have agreed to a $270 million settlement in a lawsuit that claims the illegal marketing of OxyContin helped lead to the opioid crisis.

The Hill

Wednesday, March 27, 2019 

These and more weekly news items on the business of healthcare are featured in the MCOL Weekend edition, along with the MCOL Tidbits, and more, for MCOL Premium level members.