Sam’s Club to launch a private health insurance exchange – The Washington Post

October 23, 2014 Leave a comment

The exchange, known as The Aetna Marketplace for Sam’s Club, will be available in 18 states beginning this month to members, their employees and their families. Employers can choose whether to offer a defined contribution plan or one that gives workers a flat, pre-tax contribution to apply toward a plan of their choice.

One of Sam’s Club’s chief rivals, Costco, already offers a private insurance marketplace that is geared at individual shoppers. The Sam’s Club marketplace is different in that it was designed specifically to appeal to small-business owners, although individual members could potentially sign up for it. Sam’s says that some 70 percent of its customers who hold business memberships have five or fewer employees.

via Sam’s Club to launch a private health insurance exchange – The Washington Post.

This collaboration exploits the weak 2013-14 rollout of the Small Business Health Options Program (SHOP) states must operate within their health benefit exchanges as the exchanges prioritized the individual plan side of their operations and outreach efforts.

Private sector marketplaces like this one compete with the SHOP. But the SHOP offers something they cannot: income tax credits for small employers with 25 or fewer employees paid an average of $50,000 or less annually. The credits can be claimed for a 2-year period provided the employer pays at least half of the premium.

 


The ACA health insurance market reforms are at hand. Need help understanding and preparing for the new regulatory landscape and the health benefit exchange marketplace -- and explaining them to your key stakeholders?  Pilot Healthcare Strategies can help with expert analysis and clear communications. For a free initial consultation, email me at fpilot@pilothealthstrategies.com or call 530-295-1473. 

Healthcare Reform Update: More providers, insurers showing appetite for narrow networks | Modern Healthcare

October 17, 2014 Leave a comment

The ACA is driving much of the shift toward these narrow-network products, said Gerald Kominski, director of the UCLA Center for Health Policy Research in Los Angeles. The healthcare reform law standardizes health plan benefits and sets caps on out-of-pocket costs. So providers and insurers are using unique networks as a differentiator. “If you’re competing on price and you can’t vary copayment structure or deductibles, the only thing you can do is try and keep your networks as affordable as possible,” Kominski said.It’s not surprising to see providers and insurers try to copy Kaiser Permanente, said Peter Lee, executive director of Covered California, the state’s insurance exchange, at a virtual conference Wednesday organized by Modern Healthcare. “People understand when you pick Kaiser, you get a designated set of care delivery. I think it’s a very healthy thing for the entire health system to compete on delivery.”But experts caution that Kaiser has half a century of experience in operating a staff-model HMO, and other providers and insurers won’t be able to replicate that model quickly.

via Healthcare Reform Update: More providers, insurers showing appetite for narrow networks | Modern Healthcare.

Narrow networks help bridge the tradeoff between richer benefits mandated by the ACA and keeping premiums affordable –which in turn promotes the spread of risk fundamental to the viability of all insurance products. However, for narrow networks to properly function in the marketplace, they have to be true provider networks and not simply a list of suggested providers offered along with a major caveat emptor that there’s no guarantee a particular provider is in the network and accepting plan members.

Why? Because individuals and families purchase health insurance for the peace of mind it provides and the certainty that care is available when needed and covered per the coverage terms. That’s the key value. Otherwise, it functions more like those garbage “health plans” the ACA was designed to do away with that offered discounted services provider lists that could not be relied upon as accurate and current. As a vertically integrated risk bearing and provider entity, Kaiser Permanente holds a major advantage over other commercial health plan issuers in that its providers are in house, sparing Kaiser members the risk associated with provider network volatility and uncertainty that can hamper other commercial health plan issuers.

Because by definition there are fewer available providers in narrow network plans, there’s also less room for error when a member is seeking an in-network provider. That’s why it’s essential narrow network plans have networks with provider rosters that are accurate and up to date.

 


The ACA health insurance market reforms are at hand. Need help understanding and preparing for the new regulatory landscape and the health benefit exchange marketplace -- and explaining them to your key stakeholders?  Pilot Healthcare Strategies can help with expert analysis and clear communications. For a free initial consultation, email me at fpilot@pilothealthstrategies.com or call 530-295-1473. 

Aetna, Hill Physicians Medical Group and Dignity Health’s Hospitals and Medical Foundation Form Accountable Care Collaboration in Northern California

The agreement features a new payment model to reward Hill Physicians and Dignity Health for meeting quality, efficiency and patient satisfaction measures, including:

  • The percentage of Aetna members who get recommended preventive care and screenings;
  • Better management of patients with chronic conditions, such as diabetes and heart failure;
  • Reductions in avoidable hospital readmission rates; and
  • Reductions in emergency room visits.

via Aetna, Hill Physicians Medical Group and Dignity Health’s Hospitals and Medical Foundation Form Accountable Care Collaboration in Northern California – The Health Section.

 

This agreement affects Aetna’s group market; the insurer withdrew from California’s individual health insurance market as of 2014.

The move follows by two weeks the unveiling of an individual market Accountable Care Organization (ACO) formed by Anthem Blue Cross and 6,000 doctors and 14 hospitals across seven Southern California health systems.

 


The ACA health insurance market reforms are at hand. Need help understanding and preparing for the new regulatory landscape and the health benefit exchange marketplace -- and explaining them to your key stakeholders?  Pilot Healthcare Strategies can help with expert analysis and clear communications. For a free initial consultation, email me at fpilot@pilothealthstrategies.com or call 530-295-1473. 

Viewpoints: Lack of doctors in Humboldt reflects rural problems with access to health care – California Forum – The Sacramento Bee

The takeaway by Humboldt-Del Norte County Medical Society executive director Penny Figas: “The patients don’t have access.”

Humboldt is one of 22 rural Northern California counties to make up Covered California’s pricing Region 1. Anthem has signed up 91 percent of the region’s 49,665 enrollees. If Humboldt’s profile resembles its rural brethren, of its 5,679 enrollees, more than 5,000 will have a lot of trouble finding a physician to see them.

Without question, access is a major issue facing Obamacare’s implementation in California. What good is it to sign up for and pay for health insurance if you can’t find a doctor to see you?

via Viewpoints: Lack of doctors in Humboldt reflects rural problems with access to health care – California Forum – The Sacramento Bee.

While the Patient Protect and Affordable Care Act’s reforms of the individual health insurance market and expanded Medicaid eligibility have increased access to coverage, that coverage becomes far less valuable when health care providers don’t accept it. The health insurance crisis may be morphing into a provider access crisis, with the first indications showing up in rural America where provider networks are the least robust.

 


The ACA health insurance market reforms are at hand. Need help understanding and preparing for the new regulatory landscape and the health benefit exchange marketplace -- and explaining them to your key stakeholders?  Pilot Healthcare Strategies can help with expert analysis and clear communications. For a free initial consultation, email me at fpilot@pilothealthstrategies.com or call 530-295-1473. 

Rapid Growth in Wisconsin’s Medicaid Program Could Cause Strain on State Budget | MacIver Institute

[Madison, Wisc...] The Department of Health Services (DHS) has requested a $2.78 billion increase in funding for the 2015-17 biennium. The new dollars would grow the agency’s total budget to nearly $23 billion, or roughly one-third of the entire state budget.

Almost half of the new money, $1.25 billion, would come from the federal government, which already provides $10.5 billion to the agency for federally sponsored programs. Another $831.5 million would come from Wisconsin’s General Fund, made up of state tax dollars paid by the average Wisconsinite.

What is driving such an increase in costs for the agency? The answer lies mostly in its massive Medicaid program.

Of the $831.5 million in additional state dollars requested by DHS, $760 million would be added to Wisconsin’s Medicaid program and its outcrop, BadgerCare.

via Rapid Growth in Wisconsin’s Medicaid Program Could Cause Strain on State Budget | MacIver Institute.

This is likely to become a major budgetary issue in the states. This summer, California had to appropriate more than $2 billion in increased tax revenues in its fiscal year 2014-15 budget toward offsetting rising Medicaid cost sharing.

 


The ACA health insurance market reforms are at hand. Need help understanding and preparing for the new regulatory landscape and the health benefit exchange marketplace -- and explaining them to your key stakeholders?  Pilot Healthcare Strategies can help with expert analysis and clear communications. For a free initial consultation, email me at fpilot@pilothealthstrategies.com or call 530-295-1473. 

Underinsured ACA enrollees strain community health centers | Modern Healthcare

September 26, 2014 Leave a comment

When the ACA was enacted, leaders of community health centers were excited about the prospect of their previously uninsured patients getting coverage and having their levels of uncompensated care drop. But they were surprised when many of their lower-income patients bought bronze plans with high cost-sharing and started coming in seeking treatment on a sliding-scale fee basis. Previously, sliding-scale fees were used mostly by uninsured people who had to pay their own bills.

The centers say this has had a negative impact of their finances. “The use of the sliding fee scale due to the inability to pay required co-pays impacts the community health centers’ uncompensated-care costs, which are not declining as rapidly as contemplated by some policymakers,” said Mary Leath, CEO of Community Health Centers of Arkansas.

The squeeze is being felt even in states that have expanded Medicaid to adults with incomes up to 138% of poverty, which has provided community health centers in those states with more paying patients. Deb Polun, director of government affairs at the Community Health Center Association of Connecticut, said the lowest deductibles for bronze plans in her state are about $4,000, which is not affordable for lower-income patients.

via Underinsured ACA enrollees strain community health centers | Modern Healthcare.

This is an interesting development that points to some potential implications:

1. Lower income households are mistakenly choosing high deductible bronze metal tier plans that are ill suited to their economic resources and health statuses — particularly among people who are frequent users of primary care services — because they don’t understand how out of pocket cost sharing works and believe health plans are all inclusive.

2. These households should be but are not being directed toward silver metal tier plans that feature cost sharing subsidies for households earning up to 250 percent of federal poverty. If so, this suggests state health benefit exchanges and those who help people choose individual plans such as insurance agents need to do a better job ensuring consumers are getting adequate information in order to choose the best metal tier plan for their circumstances.

3. Lower income households are deliberately selecting bronze plans in order to benefit from their lower premiums, knowing they can get low cost primary care on a sliding scale fee basis from community health centers.

4. Lower income households are overestimating their incomes and should be enrolled in Medicaid programs if eligible instead of exchange plans. California’s state-operated exchange, Covered California, has switched some plan year 2014 enrollees from exchange plans to Medicaid when income redeterminations for plan year 2015 found some households earning too little to qualify for an exchange plan.

The item reports bronze health plan issuers are denying claims submitted by CHCs, which are then written off as uncompensated care. This raises the question of the type of care for which reimbursement is requested since preventative services are not subject to cost sharing and are included in plans at all metal tiers of coverage.

 


The ACA health insurance market reforms are at hand. Need help understanding and preparing for the new regulatory landscape and the health benefit exchange marketplace -- and explaining them to your key stakeholders?  Pilot Healthcare Strategies can help with expert analysis and clear communications. For a free initial consultation, email me at fpilot@pilothealthstrategies.com or call 530-295-1473. 

Employers shouldn’t be in the wellness business

September 23, 2014 3 comments

Many American employers are looking to establish employee wellness programs – something that Princeton University health care economist Uwe E. Reinhardt believes they shouldn’t be doing. People should be aware of their health and what they need to do to improve and preserve it. But their health status is not — nor should it be — the responsibility of their employers, Reinhardt said in this interview with Managed Care. (Reinhardt’s comments on this topic begin at 15 minutes into the interview)

Just as government price controls instituted during World War II incented employers to offer health plans for their employees and led to today’s system of employer-based coverage as the norm for most working age Americans, Reinhardt takes a similar view of wellness programs. “I think in America, employers stumbled into this by default,” Reinhardt observed. “I think it’s sad, very sad. Employers should not be doing it.”

I agree with Reinhardt. Health maintenance is ultimately a personal responsibility and not that of one’s employer, health plan and for the vast majority of people, their health care providers. Most human beings naturally tend toward health at all life stages if they live in a healthy environment and engage in health enhancing behaviors relative to diet, plenty of vigorous exercise that raises the heart rate and getting 7 to 8 hours of sleep every night.

Rather than set up formal wellness programs, employers should support people’s decisions to engage in these behaviors and provide them to ability to do so while recognizing everyone has their own personal journey toward health.

 


The ACA health insurance market reforms are at hand. Need help understanding and preparing for the new regulatory landscape and the health benefit exchange marketplace -- and explaining them to your key stakeholders?  Pilot Healthcare Strategies can help with expert analysis and clear communications. For a free initial consultation, email me at fpilot@pilothealthstrategies.com or call 530-295-1473. 

Uwe Reinhardt on future of U.S. healthcare: No single payer, end of Medicaid

September 22, 2014 Leave a comment

About halfway into this interview with Managed Care, Princeton University health care economist Uwe Reinhardt prognosticates where the U.S. health system is headed in the post-Patient Protection and Affordable Care Act era. And it’s not Canadian-style single payer where a government monopsony pays providers.

However, Medicaid as a public payer could go away in a three-tiered system foreseen by Reinhardt and replaced with publicly financed providers: public clinics and hospitals. Potentially accelerating Reinhardt’s prediction are significant challenges states are experiencing ensuring those eligible for Medicaid get timely, continuous coverage and have access to a sufficient pool of providers. These challenges have been heightened by expanded ACA Medicaid eligibility in some states and difficulties complying with the ACA mandate that state health benefit exchanges employ a single, electronic application process for both commercial exchange plans and state Medicaid programs.

For most people in private insurance plans, Reinhardt predicts the growth of reference pricing where payers set a standard reimbursement for common procedures or medications. Providers would not be reimbursed above reference price level but could opt to charge more and give patients the option of paying the difference out of pocket. Reinhardt sees higher relative prices charged for procedures and medications compared to other nations as the primary reason why U.S. health care costs are often double or more that of other countries for the same procedure or medication.

The third and top tier of the future U.S. health system is concierge or “boutique” medicine where those who can afford it have their own personal physician on retainer.

 


The ACA health insurance market reforms are at hand. Need help understanding and preparing for the new regulatory landscape and the health benefit exchange marketplace -- and explaining them to your key stakeholders?  Pilot Healthcare Strategies can help with expert analysis and clear communications. For a free initial consultation, email me at fpilot@pilothealthstrategies.com or call 530-295-1473. 

Covered California official concerned over provider network volatility, enrollee access

September 19, 2014 1 comment

As California’s health benefit exchange marketplace, Covered California, prepares for Plan Year 2015 enrollment in November, at least one of its board members is openly concerned whether plan enrollees will have predictable access to in-network health care providers.

At a Covered California board meeting this week, Board Member Kim Belshé observed there has been a “steady drumbeat” of media accounts of Plan Year 2014 enrollees having difficulty finding physicians willing to accept Covered California plans. Belshé pointed to an aggravating factor of what she described as nearly real time changes to plan network provider rosters. California Executive Director Peter Lee noted some plan issuers are updating their network provider lists as frequently as weekly.

That introduces a degree of uncertainty that devalues the plans by robbing enrollees of the peace of mind that they will be able to see a network provider without running the risk of being turned away or having to pay more for care from a non-network provider. With the use of smaller networks in order to hold down premium rates, the likelihood that a provider isn’t in a given plan’s network increases.

It appears to come down to money and specifically provider reimbursement rates. Media accounts such as this one point to provider dissatisfaction over reimbursement rates for Covered California plans. This San Jose Mercury News item explains:

Many doctors are upset about the discounted reimbursement rates that insurers have imposed on them to keep premiums low on the Covered California exchange. The new rates — as much as 30 percent lower than those paid by nonexchange plans — took effect Jan. 1, when the new health care plans of hundreds of thousands of Californians kicked in.

The Patient Protection and Affordable Care Act and California law require health plan issuers that offer plans both on and off the California exchange to offer off exchange plans at the same price as exchange plans. But there is no requirement that provider networks be the same among the plans. California law effective June 16, 2014 allows plan issuers to factor provider networks into setting premium rates. Narrower networks can decrease rates but with the tradeoff of access to a wider pool of providers that affords enrollees a greater level of certainty a given provider may be in their plan network.

 


The ACA health insurance market reforms are at hand. Need help understanding and preparing for the new regulatory landscape and the health benefit exchange marketplace -- and explaining them to your key stakeholders?  Pilot Healthcare Strategies can help with expert analysis and clear communications. For a free initial consultation, email me at fpilot@pilothealthstrategies.com or call 530-295-1473. 

GAO report points to low Medicaid reimbursements as impetus for “Arkansas plan”

September 17, 2014 Leave a comment

A recent critical assessment of Arkansas’s use of federal Medicaid dollars to subsidize the purchase of commercial individual health plans by low income people through the state’s health benefit exchange indicates a lack of health care providers willing to accept standard Medicaid reimbursement played a key role in the move. The repurposing of the Medicaid funding was authorized under a 3-year-long demonstration project waiver issued in the U.S. Department of Health and Human Services (HHS) in 2013.

The U.S. Government Accountability Office (GAO) issued a report earlier this month criticizing the waiver as contrary to HHS’s policy of requiring such waivers not incur costs beyond existing state Medicaid program expenditures. The report concluded that $4 billion HHS approved for the demonstration project was approximately $778 million more than the state would have spent for adult beneficiaries under its then-existent Medicaid program. HHS disagrees with the report’s conclusion, contending GAO too narrowly analyzed HHS’s budget neutrality policy governing Medicaid demonstration programs and Arkansas’s Medicaid cost data and failed to take into account the effect of Medicaid program expansions.

The stated policy intent of the demonstration is to ensure access to care and continuity of coverage since individuals could stay enrolled in the same health plan regardless of whether their coverage is financed through Medicaid or federal subsidies. The GAO report noted that according to Arkansas’s waiver application, the state’s network of Medicaid providers was at capacity. “By purchasing [exchange qualified health plan] coverage for newly eligible [Medicaid] beneficiaries, the state suggested it could improve access to care because beneficiaries would have access to expanded provider networks” through commercial plans sold on the exchange.

The GAO report takes issue with “questionable assumptions about provider payment rates,” noting the demonstration program projected the cost of expanding Medicaid without the demonstration assumed Arkansas would have had to pay its Medicaid providers rates comparable to private insurance payment rates—significantly higher rates than the rates the state was paying its [Medicaid] fee for service (FFS) providers—to ensure access for newly eligible beneficiaries.

For example, the report noted, the state assumed that it would have to pay 67 percent above its Medicaid reimbursement rate for primary care services and 10 percent above Medicaid reimbursement rates for higher-cost services such as inpatient and long-term care. “HHS approving officials told us that they thought the state’s underlying concern about the insufficient capacity of the state’s Medicaid provider network was valid given a projected 25 percent increase in the number of individuals covered under the state’s Medicaid program,” the GAO report states.

HHS has approved similar demonstration waivers for Iowa and Pennsylvania, allowing those who would otherwise be eligible for Medicaid coverage to purchase coverage through those state’s health benefit exchanges. Interest has also been shown by New Hampshire and active negotiations underway between HHS and Utah.

“Arkansas’s demonstration may prove an important test of whether using Medicaid funds to finance coverage offered through exchanges will improve access to care and continuity of coverage for the adult population that the demonstration aims to cover,” the GAO report concludes. “However, the increasing use of demonstrations has shifted a significant portion of federal Medicaid funds into financing care that is not subject to all of the federal Medicaid requirements. While HHS policy requires that demonstrations be budget-neutral and therefore not increase the costs to the federal government, we have had long-standing concerns about the Department’s ability to ensure budget neutrality given HHS’s flexible approach towards approving spending for new demonstrations.”

 


The ACA health insurance market reforms are at hand. Need help understanding and preparing for the new regulatory landscape and the health benefit exchange marketplace -- and explaining them to your key stakeholders?  Pilot Healthcare Strategies can help with expert analysis and clear communications. For a free initial consultation, email me at fpilot@pilothealthstrategies.com or call 530-295-1473. 

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