Archive for March 2012
HHS: Essential benefits to be determined by states By doverland FierceHealthPayer; 12/16/2011 – 15:35 Insurers are slowly inching toward knowing what essential benefits they must offer in plans sold through health insurance exchanges. But that doesn’t mean they’re any closer to learning about what specific benefits are actually required.
The Department of Health & Human Services (HHS) is giving states almost complete flexibility to determine what essential benefits they will require as a condition of participation in their exchanges, according to a “pre-rule bulletin” the agency issued Dec. 16.
The health reform law lists 10 broad benefits categories that every plan sold through exchanges must provide, but it leaves the determination of specific requirements to HHS, which has decided to pass the decision on to the states, according to The Hill’s Healthwatch.
The agency’s decision means there won’t be one national standard benefits package for insurers to comply with, but instead different “benchmark” plans in each state where they operate, reports Kaiser Health News.
According to the bulletin, states must choose from one of four benchmark options provided by HHS–one of the three largest small group plans in the state; one of the three largest state employee health plans; one of the three largest federal employee health plan options; or the largest HMO plan offered in the state’s commercial market.
HHS chose to issue the bulletin instead of a proposed regulation, so the guidance doesn’t have the force of law, KHN notes. Also, HHS only addressed services and items covered by a health plan in its bulletin. The agency said it will address cost-sharing features, including deductibles, copayments and coinsurance, in future bulletins and rules.
Kaiser Primer Explains Reform Issues before Supreme Court Joseph Goedert; March 21, 2012 12:25pm ET
With the Supreme Court tackling constitutional challenges to the Affordable Care Act during oral arguments March 26-28, the Kaiser Family Foundation has published a very readable 10-page primer of the issues and arguments before the court.
The issues cover the individual mandate, severability, expansion of Medicaid, the Commerce Clause, the Necessary and Proper Clause, taxing power, and the implications of up or down rulings on those issues.
The foundation also has released results of a survey on public views of the reform law. In particular, the survey finds more than half of respondents believe justices’ ideological views will play a major role in their decision.
The primer for oral arguments and survey results are located on the web. A feature story in the January issue of Health Data Management explained core issues before the court and their implications for health information technology provisions of the law.
Review of Medicaid Audit Program Finds Big Flaws Joseph Goedert; March 20, 2012 3:44pm ET HealthDataManagement
Flaws in processes and use of data are significantly hindering recoupment of Medicaid overpayments under the Medicaid Integrity Contractor Audit program, according to a new report from the Department of Health and Human Services’ Office of Inspector General.
The 370 audits were assigned between January and June 2010 with an estimated $80 million in potential overpayments, but the 11 audits revealing overpayments only yielded a total of $6.7 million. By June 2011, most of the rest of remaining audits were completed with no finding of overpayment, or ongoing but unlikely to identify overpayments.
“Specifically, 109 of the 144 ongoing audits are unlikely to identify overpayments because the methods used to select the audit targets have already proven unsuccessful,” according to the OIG report. “The 109 audit targets were selected using the same algorithms in the same states as other completed audits that primarily had findings of no overpayments.”
Further, 36 percent of 157 audits with no overpayments were mistakenly selected based on conclusions drawn from erroneous data. The data identified the claims for audit targets as inpatient claims, when they were in fact outpatient claims. In 13 other audits, claims data were outdated; the claims were identified as overpayments, but problems had been corrected with changes not reflected in the database.
Among its recommendations, OIG calls for more collaborative identification of audit targets by contractors that conduct audits, contractors that review audits, the states and the Centers for Medicare and Medicaid Services.
Also, improving the ability of review contractors to analyze Medicaid data in the context of state-specific policies through better communication would reduce targets misidentified because of misapplication of state policy, according to OIG. The report, “Early Assessment of Audit Medicaid Integrity Contractors,” is available here.
Millions in Medicaid overpayments uncollected due to faulty auditing By Alicia Caramenico Fierce Healthcare 21 March 2012
Medicaid Integrity Contractor (MIC) audits failed to recoup overpayments due to flawed methods of identifying providers who potentially received excess funds, according to a new report from the Office of Inspector General.
Although the 370 assigned audits between Jan. 1 and June 30, 2010 had about $80 million in potential overpayments, the report found that only 11 percent of the audits identified overpayments–recouping only $6.7 million.
Moreover, 42 percent found no overpayments, while 39 percent remained ongoing as of June 2011 and are not likely to identify overpayments.
“Specifically, 109 of the 144 ongoing audits are unlikely to identify overpayments because the methods used to select the audit targets have already proven unsuccessful,” the report states.
Incorrect claims data, as well as the misinterpretation of the claims data with regards to state-specific Medicaid policies led to misidentified audit targets, according to the report.
To ensure audits target the right providers, the agency recommends collaborative efforts among Audit MICs, Review MICs, the states and the Centers for Medicare & Medicaid Services, according to an OIG statement. Not only does collaboration eliminate duplicative efforts, it also completes audits an average of 2.5 months faster than regular audits, according to the report’s authors.
Given the findings, CMS said it has revamped how it selects audit targets–such improvements could save the government money as CMS spent about $17.2 million on MIC audits in fiscal year 2010.
In its accompanying study, the OIG concluded last month that MIC reviews are not being used to their full potential because they can only access incomplete data and cannot make specific recommendations about which organizations should be further scrutinized, FierceHealthFinance previously reported.
Medicaid computer system glitches costing states millions By Dan Bowman Fierce Health IT 21 March 2012
Computer problems are plaguing state Medicaid agencies across the nation, according to a number of recent reports, causing everything from overpayments and unauthorized payments to extra front-end work for providers. Technical glitches have been reported for systems in Louisiana, Florida, Colorado and Maine.
In Louisiana, several providers have said the state’s Clinical Advisor system–developed by Connecticut-based Magellan Health Services–has prevented them from submitting claims, Gambit reports. While some providers said their passwords weren’t working, others indicated the system wouldn’t allow them to enter patient medical records and diagnoses.
Specifically, Cecilia McNeil–chief of operations and finance for Chalmette, La.-based mental health rehabilitation provider the Guidance Center–said information she entered into the system simply vanished overnight, causing her to have to re-enter that data into the system all over again.
“It’s caused a huge among of extra work for us,” she tells Gambit.
Meanwhile in Florida, glitches in a computer billing system implemented by the state’s Agency for Health Care Administration have made it nearly impossible to bill the state’s 67 counties for Medicaid expenses with any accuracy, according to a commentary in The Ledger. The AHCA reported more than $300 million in uncollected Medicaid bills, the commentary notes, much of which will need to be repaid by the counties, according to an article in The St. Augustine Record.
In Colorado, computer glitches have caused processing delays for eligibility benefits, as well as incorrect information to be sent to recipients, The Denver Post reports.
Maine’s issues are well-documented, as well. The state’s Medicaid system, according to the Bangor Daily News, likely will have to repay the federal government after 19,000 citizens not eligible for Medicaid received such benefits due to a computer glitch.
When I found out that Department of Health & Human Services Secretary Kathleen Sebelius was going to be on The Daily Show last week, I was really excited. Not just because I happen to think Jon Stewart, The Daily Show’s host, is possibly one of the best interviewers working in media right now (despite the fact that he’s not really a journalist and the show is completely satirical), but also because I knew that meant issues I cover every week–healthcare reform and insurance companies–were going to be discussed in a fresh manner.
And I wasn’t disappointed. In an interview  that extended well beyond the typical allotted time (the excess portion was available exclusively online), Stewart didn’t allow Sebelius merely to regurgitate her rehearsed health reform talking points. Instead, he almost immediately delved into the recent HHS decision to allow states to determine what benefits health plans must offer to sell plans through health insurance exchanges.
“Because the flexibility should be at the state level,” Sebelius explained, “Insurance markets are different and we want to give states, within a framework…” She couldn’t finish her thought though because Stewart interrupted, obviously wanting a more substantive answer. “You want me to take it all on,” Sebelius said with an awkward chuckle. “I’m not going to.”
That’s where insurers should perk up. Sebelius clearly is pledging there will not be one federal exchange that trumps state-run exchanges so insurers must pay attention to the exchange-related actions of the states where they do business. For the big insurers, that means simultaneously monitoring several states’ activities.
What HHS will do is set the framework, Sebelius said, by establishing ground rules for payers. “Insurance companies for the first time have to play by a set of rules,” she said. “No more cherry-picking the market to kick out people who might get sick, for instance.”
As she attempted to describe the medical-loss ratio (in layman’s terms, no less – good luck!) as an example of the ground rules, Stewart interjected, hitting on one of healthcare reform’s biggest problems: much of the provisions are too complicated and people don’t understand them. “I’ve started reading about it and it’s so confusing,” Stewart said. And regardless of whether you agree with Stewart’s political leanings, he is definitely one intelligent man.
Last, but not least, Stewart questioned Sebelius about how a Supreme Court decision, namely a ruling that the individual mandate is unconstitutional, could affect health reform efforts overall. Although Sebelius is confident the mandate will be upheld, she said HHS will pursue alternatives if the agency receives an unfavorable decision. “I think we keep going,” she said. “We find ways to encourage people to become enrolled and become insured. And the mandate’s the fastest way to do it, and it just says, basically, everybody’s got some responsibility. But there are other ways to encourage people to come in,” she added.
So what’s the upshot here? HHS is taking health reform and its complex, confusing requirements to the states, which means insurers will be operating within several exchanges and their various accompanying conditions, even if the Supreme Court shoots down the reform law. That’s a lot of real information for a fake news show. -Dina  (@HealthPayer )
A look at the Supreme Court health reform challenge
By Alicia Caramenico
The healthcare industry is bracing itself, as the Supreme Court, whose final ruling will ultimately decide the constitutionality of President Obama’s health reform legislation, will hear the challenge brought up by 26 states next week.
If the court upholds the law, the implementation of provisions can proceed as scheduled. But that could cause more harm than good, warns Joseph Antos, an American Enterprise Institute for Public Policy Research analyst. “In reality, many of the states, including states that really want to do it, are woefully unprepared,” he told Healthcare IT News.
If the law is struck down, provisions already in effect would have to be withdrawn; for example, children would no longer be allowed to stay on their parents’ insurance plan up to age 26.
The Supreme Court also must decide what happens to the rest of the health reform law if only the individual mandate is ruled unconstitutional. While opponents say the entire law should get struck down, the government maintains that only two provisions (including one requiring insurers cover people with preexisting health problems) would have to fall, according to ABC News.
Industry experts warn, though, that such a move would make the rest of the law more difficult to carry out. “Without a mandate the law is a lot less effective,” MIT economist Jonathan Gruber told the Associated Press. “The market will not collapse, but it will be a ton more expensive and cover many fewer people.”
Similarly, Paul Keckley, executive director of Deloitte Center for Health Solutions, said there could be mass effects on the young, newly insured. “Should the individual mandate ultimately be ruled unconstitutional, it will significantly hamper the ACA’s ability to ensure some of those previously uninsured ‘young invincibles,’ as well as seriously undermining a key rationale for funding the new law,” he said in a statement to FierceHealthcare.
Despite the Supreme Court ruling, health executives at hospitals, medical groups and insurers in California said they will press on with healthcare reform, the Sacramento Business Journal reported earlier this month.
“We believe we need to drive health care reform whether it’s legislated or not,” Michael Taylor, Dignity Health’s senior vice president of operations said. “Healthcare costs are out of control and we need to bend the curve.”
Also see an article in YahooNews
California single-payer health care bill stalls in state Senate
January 26, 2012
Torey Van Oot
Sacramento Bee California’s “Medicare for all” universal health care legislation fell short of the 21 votes needed to pass the state Senate today. Senate Bill 810 failed on a 19-15 vote during this morning’s floor session, with four moderate Democrats abstaining and one voting no. Democratic Sen. Mark Leno, who authored the bill, said the proposal would stabilize health care costs and expand access to coverage. He called the bill, which does not include funding to cover the projected $250 billion annual cost of running the single-payer system, the first step in a “many year project” that will likely require asking voters to approve financing. He encouraged members to support the bill to allow the policy discussion to continue. No Republicans voted for the bill. Sen. Tony Strickland, R-Moorpark, criticized the proposal as an attempt to create “another costly and inefficient bureaucracy.” “There’s no doubt that we need health care reform, there’s no doubt that we need to improve our health care system, but members, this is not the bill to move forward,” he said. “Clearly, if you want the compassion of the IRS and the efficiency of the DMV doing your healthcare, this bill is for you,” Strickland said during floor debate on the measure. The bill faces a Tuesday deadline for passing the state Senate in the current legislative session. Several similar bills have cleared one or both houses in recent years. The last version to win legislative approval was vetoed by then-GOP Gov. Arnold Schwarzenegger.
Unfortunately, as many probably suspect, it has done little to control costs.
“There was a significant increase in premium costs paid by workers, reflecting Massachusetts decision to put off efforts to address lowering health care costs in the 2006 legislation,’’ according Health Affairs, the journal that published an article based on the survey on its website today.
The Blue Cross Blue Shield Massachusetts Foundation commissioned the 2010 telephone survey of 3,000 nonelderly adults.
“This comprehensive assessment of health reform shows that the Massachusetts model for expanding access to coverage and needed care has held up well during some of the worst economic conditions in decades,” said Sarah Iselin,cq the foundation’s president. “It also shows that there’s an urgent need for the state’s health care community to address rising costs with the same level of commitment, creativity, and unified action.”
Between fall 2006 and fall 2010, emergency department use fell 3.8 percent overall, and the use of emergency departments for non-emergency conditions also dropped 3.8 percent.
At the same time, health care costs were an important issue for many families in Massachusetts in fall 2010. About half adults surveyed reported their family was spending more on health care in 2010 than in the prior year and a quarter were not confident in their ability to afford care in the coming year, the survey found.