Billy Abbott, a retired Army medic, wakes at 6 every morning, steps on the bathroom scale, and uses a cuff to take his blood pressure.
The devices send those measurements electronically to his doctor in Gulf Shores, Alabama, and a health technology company based in New York, to help him control his high blood pressure.
Nurses with the company, Cadence, remotely monitor his readings along with the vital signs of about 17,000 other patients around the nation. They call patients regularly and follow up if anything appears awry. If needed, they can change a patient's medication or dosage without first alerting their doctor.
Abbott, 85, said he likes that someone is watching out for him outside his regular doctor appointments. "More doctors should recommend this to their patients," he said.
Increasingly, they are.
Dozens of tech companies have streamed in, pushing their remote monitoring service to primary care doctors as a way to keep tabs on patients with chronic illnesses and free up appointment time, and as a new source of Medicare revenue.
But some experts say remote monitoring's huge growth — spurred on during the covid-19 pandemic, when patients were hesitant to sit in crowded doctors' waiting rooms — has outpaced oversight and evidence of how the technology is best used.
"It is the wild West where any patient can get it if a doctor decides it is reasonable or necessary," said Caroline Reignley, a partner with the law firm McDermott Will & Emery who advises health providers.
In 2019, Medicare made it easier for doctors to bill for monitoring routine vital signs such as blood pressure, weight, and blood sugar. Previously, Medicare coverage for remote monitoring was limited to certain patients, such as those with a pacemaker.
Medicare also began allowing physicians to get paid for the service even when the monitoring is done by clinical staff who work in different places than the physician — an adjustment advocated by telemedicine companies.
In just the first two full years, remote monitoring services billed to Medicare grew from fewer than 134,000 to 2.4 million in 2021, according to federal records analyzed by KFF Health News.
Total Medicare payments for the four most common billing codes for remote monitoring rose from $5.5 million in 2019 to $101.4 million in 2021, the latest year for which data is available.
Part of the allure is that Medicare will pay for remote monitoring indefinitely regardless of patients' health conditions as long as their doctors believe it will help.
For doctors with 2,000 to 3,000 patients, the money can add up quickly, with Medicare paying an average of about $100 a month per patient for the monitoring, plus more for setting up the device, several companies confirmed.
Medicare enrollees may face 20% in cost sharing for the devices and monthly monitoring, though certain private plans through Medicare Advantage and Medicare supplement policies may cover those costs. The government allowed insurers to waive the patient cost sharing during the pandemic.
About 400 doctors and other providers repeatedly billed Medicare for remote patient monitoring in 2019. Two years later, that had mushroomed to about 3,700 providers, according to Medicare data analyzed by KFF Health News. (The data tracks providers who billed more than 10 patients for at least one type of remote monitoring.)
Federal law enforcement officials say they are conducting investigations after a surge in complaints about some remote patient monitoring companies but would not provide details.
The Department of Health and Human Services' Office of Inspector General in November issued a consumer alert about companies signing up Medicare enrollees without their doctors' knowledge: "Unscrupulous companies are signing up Medicare enrollees for this service, regardless of medical necessity," and bill Medicare even when no monitoring occurs.
In a statement to KFF Health News, Meena Seshamani, director of the federal Center for Medicare, part of the Centers for Medicare & Medicaid Services, did not say how CMS is ensuring only patients who can benefit from remote monitoring receive it. She said the agency balances the need to give patients access to emerging technology that can improve health outcomes with the need to combat fraud and make proper payments to providers.
While some small studies show remote monitoring can improve patient outcomes, researchers say it is unclear which patients are helped most and how long they need to be monitored.
"The research evidence is not as robust as we would like to show that it is beneficial," said Ateev Mehrotra, a Harvard Medical School researcher.
A January report by the Bipartisan Policy Center, a Washington, D.C.-based think tank, warned about "a lack of robust evidence on the optimal use of remote monitoring" and said some policy and medical experts "question whether we are effectively ‘rightsizing' the use of these services, ensuring access for patients who need it most, and spending health care dollars in effective ways."
Denton Shanks, a medical director at the American Academy of Family Physicians, said remote monitoring helps patients manage their diseases and helps physician practices be more efficient. He has used it for the past two years as a doctor at the University of Kansas Health System.
It has worked well, he said, though sometimes it can be challenging to persuade patients to sign up if they have to pay for it.
"For the vast majority of patients, once they are enrolled, they see a benefit, and we see a benefit as their vital signs come in the normal range," Shanks said.
The size of the market is tantalizing.
About two-thirds of the more than 66 million Medicare beneficiaries have high blood pressure, the most common metric monitored remotely, according to physicians and the monitoring companies.
"The patient need is so enormous," Cadence CEO Chris Altchek said. The company has about 40 nurses, medical assistants, and other providers monitoring patients in 17 states. He said patients enrolled in remote monitoring experience a 40% reduction in emergency room visits. Cadence says 82% of its patients use the devices at least once every two days.
Timothy Mott, a family physician in Foley, Alabama, said valuable appointment times in his office open up as patients who previously needed vital signs to be checked there turn to remote monitoring.
Cadence nurses regularly contact Mott's patients and monitor their readings and make changes as needed.
"I was concerned early on whether they were going to make the right decisions with our patients," Mott said. "But over time the dosage changes or changes in medication they are making are following the best guidelines on effectiveness."
At the six-month mark, about 75% of patients have stayed with the monitoring, Mott said.
The advantages are apparent even to some providers who do not get paid by Medicare to offer the service. Frederick Health, a Maryland health system, provides remote monitoring to 364 high-risk patients and estimates the program saves the nonprofit system $10 million a year by reducing hospital admissions and ER visits. That estimate is based on comparisons of patients' Medicare claims before they started the program and after, said Lisa Hogan, who runs the program.
The hospital pays for the program and does not bill Medicare, she said.
Shelly Olson's mother, who has dementia, has lived at the Scandia Village nursing home in rural Sister Bay, Wisconsin, for almost five years. At first, Olson said, her mother received great care at the facility, then owned by a not-for-profit organization, the Evangelical Lutheran Good Samaritan Society.
Then in 2019, Sanford Health — a not-for-profit, tax-exempt hospital system — acquired the nursing home. The COVID-19 pandemic struck soon after. From then on, the facility was regularly short of staff, and residents endured long wait times and other care problems, said Olson, a registered nurse who formerly worked at the facility.
Now Scandia Village has a new, for-profit owner, Continuum Healthcare. Olson said she was reassured when Continuum hired two locals as the facility's new administrator and nursing director.
But Kathy Wagner, a former Scandia Village nursing director, is not optimistic. "The for-profit owner will face the same problems," said Wagner, who is now retired and serves on an informal task force that monitors the facility's quality of care. "No one has articulated what the for-profit owner will bring to the table to change the picture."
The sale of Scandia Village this year is part of a trend of for-profit companies, including private equity groups and real estate investment trusts, snapping up struggling not-for-profit nursing homes, many of which were operated for decades by Lutheran, Catholic, Jewish, and other faith-based organizations.
The pace of sales has ticked up, reaching a high last year, according to Ziegler Investment Banking. Since 2015, 900 not-for-profit nursing homes and senior living communities nationwide have changed hands, with more than half of them acquired by for-profit operators.
For-profit groups own about 72% of the roughly 15,000 nursing homes in the United States, which serve more than 1.3 million residents.
While overall for-profit ownership percentage hasn't notably increased in recent years, the type of for-profit companies that own these facilities has shifted toward private equity, real estate investment trusts, and complicated ownership structures, said David Grabowski, a professor of health care policy at Harvard Medical School.
Consumer advocates, researchers, and regulators are leery about this trend. They point to studies showing that nursing homes owned by for-profit companies — particularly investors in private equity and real estate — tend to have skimpier staffing, lower quality ratings, and more regulatory violations. Motivated by these concerns, the Biden administration issued a rule last fall that requires nursing homes to disclose more information about their owners and management firms.
Executives at not-for-profit organizations, as well as researchers who study nursing homes, wonder how for-profit companies can accomplish what the previous not-for-profit owners could not: reviving financially struggling nursing homes.
"I don't know where these investor groups can see savings without cutting back on the level of quality," Grabowski said.
Part of the problem is that to boost profits, many for-profit operators set up a network of related companies to provide fee-based services such as management, physical therapy, and staffing. They also may sell a nursing home's real estate to a sister company, which then charges high rent. These payments cut into the available operating funds to provide adequate staffing and quality care.
Last year, New York Attorney General Letitia James sued the for-profit owners of four nursing homes for financial fraud and resident neglect, alleging that they used more than $83 million in public funds to enrich themselves through a complex network of related companies while providing horrendous care.
"When nonprofits are sold, you start to see a precipitous decline in quality," said Sam Brooks, director of public policy for National Consumer Voice for Quality Long-Term Care. "Nonprofits generally staff well above for-profits. When churches and nonprofits divest these homes, for-profits move in, and the care gets really bad."
The leaders of not-for-profits that have sold facilities to for-profit operators cite a variety of reasons for exiting or downsizing. Those reasons include state Medicaid payment rates that are too low to cover operating costs and a shortage of nursing and other staffers that makes it hard to maintain quality care. In addition, they say their facilities have seen fewer admissions, at least partly because Medicare Advantage plans have tightened coverage policies for rehabilitation care in nursing homes.
Susan McCrary, chief executive of St. Ignatius Community Services in Philadelphia, said her organization sold its nursing home because it was losing money. She said low state Medicaid rates forced their hand, even after the state bolstered its Medicaid payments by 17.5% in January 2023.
McCrary said the St. Ignatius board worried the losses would jeopardize the organization's ability to continue its mission of serving low-income seniors, for whom it also operates three independent-living and assisted living buildings.
At the same time, "our board definitely had concerns about selling to a for-profit because we're aware of the research that shows the quality of care is not the same as with a nonprofit," McCrary said. "But we knew we needed to move forward with this process to continue our services in West Philadelphia."
Nate Schema, CEO of the Evangelical Lutheran Good Samaritan Society, said his organization decided to sell some of its long-term care facilities to Continuum Healthcare, a New Jersey-based corporation, and a second company, Idaho-based Cascadia Healthcare, as part of its strategy to better serve its communities. Good Samaritan now operates in seven Midwestern states, down from 22 states. Consolidating markets better enables his organization to launch programs for nursing home residents in conjunction with Sanford's hospitals and clinics.
"We've been very intentional about finding quality partners to carry on our mission," Schema said. "Unfortunately, we haven't seen a lot of nonprofit providers coming to us."
Continuum, which took over Scandia Village nursing home in January, will address staffing shortages by improving wages, benefits, and career opportunities, said Tim Hodges, the corporation's communications director. Continuum, which is owned by private investors and commercial lenders, owns eight nursing homes in four states.
Similarly, Steve LaForte, Cascadia's executive vice president, said his company has revived the finances of the nine Good Samaritan nursing homes it took over in the Pacific Northwest partly by attracting more patient referrals and strengthening relationships with state policymakers, in the hope it "leads to more realistic Medicaid rates." He said Cascadia has also focused on workplace culture — such as by not using workers from staffing agencies — and on empowering those who run the individual facilities to select vendors for pharmacy, rehabilitation, and other services.
Cascadia, he said, does not use tactics like contracting with sister vendors to boost its profits. "That type of organization gives the whole industry a bad name," LaForte said.
The overall perception of for-profit corporations is unfair, said Zach Shamberg, CEO of the Pennsylvania Health Care Association, because all nursing homes are struggling under inadequate Medicaid rates and high labor costs due to a shortage in workers.
He said he hopes that Pennsylvania's Medicaid rate increase — plus a new minimum staffing requirement and a mandate that 70% of total costs be dedicated to resident care — will address the financial and quality issues. Nursing homes in Pennsylvania and across the country are also lobbying state lawmakers and the federal government to offer extra payments tied to quality outcomes for residents.
"If there aren't for-profit entities to buy these facilities, these facilities are closing, which would exacerbate the existing access to care crisis as the population gets older," Shamberg said.
California Attorney General Rob Bonta announced Monday that he is throwing his weight behind legislation to bar medical debt from showing up on consumer credit reports, a Democratic-led effort to offer protection to patients squeezed by health care bills.
Bonta is a sponsor of Sen. Monique Limón's bill, which seeks to block health care providers, as well as any contracted collection agency, from sharing a patient's medical debt with credit reporting agencies. It would also prevent credit reporting agencies from accepting, storing, or sharing any information concerning medical debt. Medical debt isn't necessarily an accurate reflection of credit risk, and its inclusion in credit reports can depress credit scores and make it hard for people to get a job, rent an apartment, or secure a car loan.
"This is a broken part of our current system that needs to be fixed," Bonta, a Democrat, told KFF Health News. "This is California's opportunity, and we relish the ability to be up in front of key issues."
If enacted, California would become the third state to remove medical bills from consumer credit reports, following Colorado and New York in 2023. Minnesota has a proposal to do the same. Last year, the Biden administration announced plans to develop similar federal rules through the Consumer Financial Protection Bureau, but they have yet to be released. And should former President Donald Trump return to the White House, he would have the prerogative to undo the rules.
Limón said it's important for the state to enshrine its own protections into law alongside the federal push. "We may be waiting for a very long time to see outcomes that California could potentially deliver in the next year," said the Santa Barbara Democrat.
Bonta said he's not sure what sort of opposition to the bill to expect, but he wonders if providers and collection agencies will be resistant.
A KFF Health News analysis found that credit reporting threats are the most common collection tactic used by hospitals to get patients to pay their bills. A hospital, for example, might be concerned that a credit score ban might make it more difficult to get patients to pay for medical care they have already received.
The three largest U.S. credit agencies — Equifax, Experian, and TransUnion — have said they would stop including some medical debt on credit reports as of 2022. Among the excluded debts are paid-off bills and those less than $500, but the agencies' voluntary actions left out millions of patients with bigger medical bills on their credit reports.
Limón said she often hears from constituents about the impact medical debt has on their lives. Medical debt disproportionately affects low-income, Black, and Latino Californians, according to the California Health Care Foundation.
And, increasingly, people with healthy incomes who often carry medical insurance are incurring medical debt. A KFF Health News-NPR investigation found that about 100 million people across the country are saddled with medical debt, which has forced some to give up their homes, ration food, and take on extra work.
Though the legislation wouldn't forgive medical debt, Limón said she hopes it will encourage people to seek medical care when they need it.
"You hear so many people now that are concerned about getting medical care because they can't afford it and instead wait to get worse," Limón said. "If the bill passes, we'll see less fear and more people going to get medical care."
Margaret Parsons, one of three dermatologists at a 20-person practice in Sacramento, California, is in a bind.
Since a Feb. 21 cyberattack on a previously obscure medical payment processing company, Change Healthcare, Parsons said, she and her colleagues haven't been able to electronically bill for their services.
She heard Noridian Healthcare Solutions, California's Medicare payment processor, was not accepting paper claims as of earlier this week, she said. And paper claims can take 3-6 months to result in payment anyway, she estimated.
"We will be in trouble in very short order, and are very stressed," she said in an interview with KFF Health News.
A California Medical Association spokesperson said March 7 that the Centers for Medicare & Medicaid Services had agreed in a meeting to encourage payment processors like Noridian to accept paper claims. A Noridian spokesperson referred questions to CMS.
The American Hospital Association calls the suspected ransomware attack on Change Healthcare, a unit of insurance giant UnitedHealth Group's Optum division, "the most significant and consequential incident of its kind against the U.S. health care system in history." While doctors' practices, hospital systems, and pharmacies struggle to find workarounds, the attack is exposing the health system's broad vulnerability to hackers, as well as shortcomings in the Biden administration's response.
To date, government has relied on more voluntary standards to protect the health care system's networks, Beau Woods, a co-founder of the cyber advocacy group I Am The Cavalry, said. But "the purely optional, do-this-out-of-the-goodness-of-your-heart model clearly is not working," he said. The federal government needs to devote greater funding, and more focus, to the problem, he said.
The crisis will take time to resolve. Comparing the Change attack to others against parts of the health care system, "we have seen it generally takes a minimum of 30 days to restore core systems," said John Riggi, the hospital association's national adviser on cybersecurity.
In a March 7 statement, UnitedHealth Group said two services — related to electronic payments and medical claims — would be restored later in the month. "While we work to restore these systems, we strongly recommend our provider and payer clients use the applicable workarounds we have established," the company said.
"We're determined to make this right as fast as possible," said company CEO Andrew Witty.
Providers and patients are meanwhile paying the price. Reports of people paying out-of-pocket to fill vital prescriptions have been common. Independent physician practices are particularly vulnerable.
"How can you pay staff, supplies, malpractice insurance — all this — without revenue?" said Stephen Sisselman, an independent primary care physician on Long Island in New York. "It's impossible."
Jackson Health System, in Miami-Dade County, Florida, may miss out on as much as $30 million in payments if the outage lasts a month, said Myriam Torres, its chief revenue officer. Some insurers have offered to mail paper checks.
Relief programs announced by both UnitedHealthand the federal government have been criticized by health providers, especially hospitals. Sisselman said Optum offered his practice, which he said has revenue of hundreds of thousands of dollars a month, a loan of $540 a week. Other providers and hospitals interviewed by KFF Health News said their offers from the insurer were similarly paltry.
In its March 7 statement, the company said it would offer new financing options to providers.
Providers Pressure Government to Act
On March 5, almost two weeks after Change first reported what it initially called a cybersecurity "issue," the Health and Human Services Department announced several assistance programs for health providers.
One recommendation is for insurers to advance payments for Medicare claims — similar to a program that aided health systems early in the pandemic. But physicians and others are worried that would help only hospitals, not independent practices or providers.
Anders Gilberg, a lobbyist with the Medical Group Management Association, which represents physician practices, posted on X, formerly known as Twitter, that the government "must require its contractors to extend the availability of accelerated payments to physician practices in a similar manner to which they are being offered to hospitals."
HHS spokesperson Jeff Nesbit said the administration "recognizes the impact" of the attack and is "actively looking at their authority to help support these critical providers at this time and working with states to do the same." He said Medicare is pressing UnitedHealth Group to "offer better options for interim payments to providers."
Another idea from the federal government is to encourage providers to switch vendors away from Change. Sisselman said he hoped to start submitting claims through a new vendor within 24 to 48 hours. But it's not a practicable solution for everyone.
Torres said suggestions from UnitedHealth and regulators that providers change clearinghouses, file paper claims, or expedite payments are not helping.
"It's highly unrealistic," she said of the advice. "If you've got their claims processing tool, there's nothing you can do."
Mary Mayhew, president of the Florida Hospital Association, said her members have built up sophisticated systems reliant on Change Healthcare. Switching processes could take 90 days — during which they'll be without cash flow, she said. "It's not like flipping a switch."
Nesbit acknowledged switching clearinghouses is difficult, "but the first priority should be resuming full claims flow," he said. Medicare has directed its contractors and advised insurers to ease such changes, he added.
Health care leaders including state Medicaid directors have called on the Biden administration to treat the Change attack similarly to the pandemic — a threat to the health system so severe that it demands extraordinary flexibility on the part of government insurance programs and regulators.
Beyond the money matters — critical as they are — providers and others say they lack basic information about the attack. UnitedHealth Group and the American Hospital Association have held calls and published releases about the incident; nevertheless, many still feel they're in the dark.
Riggi of the AHA wants more information from UnitedHealth Group. He said it's reasonable for the conglomerate to keep some information closely held, for example if it's not verified or to assist law enforcement. But hospitals would like to know how the breach was perpetrated so they can reinforce their own defenses.
"The sector is clamoring for more information, ultimately to protect their own organizations," he said.
Rumors have proliferated.
"It gets a little rough: Any given day you're going to have to pick and choose who to believe," Saad Chaudhry, an executive at Maryland hospital system Luminis Health, told KFF Health News. "Do you believe these thieves? Do you believe the organization itself, that has everything riding on their public image, who have incentives to minimize this kind of thing?"
What Happens Next?
Wired Magazine reported that someone paid the ransomware gang believed to be behind the attack $22 million in bitcoin. If that was indeed a ransom intended to resolve some aspect of the breach, it's a bonanza for hackers.
Cybersecurity experts say some hospitals that have suffered attacks have faced ransom demands for as little as $10,000 and as much as $10 million. A large payment to the Change hackers could incentivize more attacks.
"When there's gold in the hills, there's a gold rush," said Josh Corman, another co-founder of I Am The Cavalry and a former federal cybersecurity official.
Longer-term, the attack intensifies questions about how the private companies that comprise the U.S. health system and the government that regulates them are defending against cyberthreats. Attacks have been common: Thieves and hackers, often believed to be sponsored or harbored by countries like Russia and North Korea, have knocked down systems in the United Kingdom's National Health Service, pharma giants like Merck, and numerous hospitals.
The FBI reported 249 ransomware attacks against health care and public health organizations in 2023, but Corman believes the number is higher.
But federal efforts to protect the health system are a patchwork, according to cybersecurity experts. While it's not yet clear how Change was hacked, experts have warned a breach can occur through a phishing link in an email or more exotic pathways. That means regulators need to consider hardening all kinds of products.
One example of the slow-at-best efforts to mend these defenses concerns medical devices. Devices with outdated software could provide a pathway for hackers to get into a hospital network or simply degrade its functioning.
The FDA recently gained more authority to assess medical devices' digital defenses and issue safety communications about them. But that doesn't mean vulnerable machines will be removed from hospitals. Products often linger because they're expensive to take out of service or replace.
Senator Mark Warner (D-Va.) has previously proposed a "Cash for Clunkers"-type program to pay hospitals to update the cybersecurity of their old medical devices, but it was "never seriously pursued," Warner spokesperson Rachel Cohen said. Riggi said such a program might make sense, depending on how it's implemented.
Weaknesses in the system are widespread and often don't occur to policymakers immediately. Even something as prosaic as a heating and air conditioning system can, if connected to a hospital's internet network, be hacked and allow the institution to be breached.
But erecting more defenses requires more people and resources — which often aren't available. In 2017, Woods and Corman assisted on an HHS report surveying the digital readiness of the health care sector. As part of their research, they found a slice of wealthier hospitals had the information technology staff and resources to defend their systems — but the vast majority had no dedicated security staff. Corman calls them "target-rich but cyber-poor."
"The desire is there. They understand the importance," Riggi said. "The issue is the resources."
HHS has proposed requiring minimum cyberdefenses for hospitals to participate in Medicare, a vital source of revenue for the entire industry. But Riggi says the AHA won't support it.
"We oppose unfunded mandates and oppose the use of such a harsh penalty," he said.
In a little more than two years as CEO of a small hospital in Wyoming, Dave Ryerse has witnessed firsthand the worsening financial problems eroding rural hospitals nationwide.
In 2022, Ryerse's South Lincoln Medical Center was forced to shutter its operating room because it didn't have the staff to run it 24 hours a day. Soon after, the obstetrics unit closed.
Ryerse said the publicly owned facility's revenue from providing care has fallen short of operating expenses for at least the past eight years, driving tough decisions to cut services in hopes of keeping the facility open in Kemmerer, a town of about 2,400 in southwestern Wyoming.
South Lincoln's financial woes aren't unique, and the risk of hospital closures is an immediate threat to many small communities. "Those cities dry out," Ryerse said. "There's a huge sense of urgency to make sure that we can maintain and really eventually thrive in this area."
A recently released report from the health analytics and consulting firm Chartis paints a clear picture of the grim reality Ryerse and other small-hospital managers face. In its financial analysis, the firm concluded that half of rural hospitals lost money in the past year, up from 43% the previous year. It also identified 418 rural hospitals across the U.S. that are "vulnerable to closure."
Mark Holmes, director of the Cecil G. Sheps Center for Health Services Research at the University of North Carolina, said the report's findings weren't a surprise, since the financial nosedive it depicted has been a concern of researchers and rural health advocates for decades.
The report noted that small-town hospitals in states that expanded Medicaid eligibility have fared better financially than those in states that didn't.
Leaders in Montana, whose population is nearly half rural, credit Medicaid expansion as the reason their hospitals have largely avoided the financial crisis depicted by the report despite escalating costs, workforce shortages, and growing administrative burden.
"Montana's expansion of Medicaid coverage to low-income adults nearly 10 years ago has cut in half the percentage of Montanans without insurance, increased access to care and preserved services in rural communities, and reduced the burden of uncompensated care shouldered by hospitals by nearly 50%," said Katy Mack, vice president of communications for the Montana Hospital Association.
Not one hospital has closed in the state since 2015, she added.
Hospitals elsewhere haven't fared so well.
Michael Topchik, national leader for the Chartis Center for Rural Health and an author of the study, said he expects next year's update on the report will show rural hospital finances continuing to deteriorate.
"In health care and in many industries, we say, 'No margin, no mission,'" he said, referring to the difference between income and expenses. Rural hospitals "are all mission-driven organizations that simply don't have the margin to reinvest in themselves or their communities because of deteriorating margins. I'm very, very concerned for their future."
People living in rural America are older, sicker, and poorer than their urban and suburban counterparts. Yet, they often live in places where many health care services aren't available, including primary care. The shorter life expectancies in these communities are connected to the lack of success of their health facilities, said Alan Morgan, CEO of the National Rural Health Association, a nonprofit advocacy group.
"We're really talking about the future of rural here," Morgan said.
Like South Lincoln, other hospitals still operating are likely cutting services. According to Chartis, nearly a quarter of rural hospitals have closed their obstetrics units and 382 have stopped providing chemotherapy.
Halting services has far-reaching effects on the health of the communities the hospitals and their providers serve.
While people in rural America are more likely to die of cancer than people in urban areas, providing specialty cancer treatment also helps ensure that older adults can stay in their communities. Similarly, obstetrics care helps attract and keep young families.
Whittling services because of financial and staffing problems is causing "death by a thousand cuts," said Topchik, adding that hospital leaders face choices between keeping the lights on, paying their staff, and serving their communities.
The Chartis report noted that the financial problems are driving hospitals to sell to or otherwise join larger health systems; it said nearly 60% of rural hospitals are now affiliated with large systems. South Lincoln in Wyoming, for example, has a clinical affiliation with Utah-based Intermountain Health, which lets the facility offer access to providers outside the state.
In recent years, rural hospitals have faced many added financial pressures, according to Chartis and other researchers. The rapid growth of rural enrollment in Medicare Advantage plans, which do not reimburse hospitals at the same rate as traditional Medicare, has had a particularly profound effect.
Topchik predicted sustainability for rural health facilities will ultimately require greater investment from Congress.
In 1997, Congress responded to a rural hospital crisis by creating the "Critical Access Hospital" designation, meant to alleviate financial burdens rural hospitals face and help keep health services available by giving facilities cost-based reimbursement rates from Medicare and in some states Medicaid.
But these critical access hospitals are still struggling, including South Lincoln.
In 2021, Congress established a new designation, "Rural Emergency Hospital," which allows hospitals to cut most inpatient services but continue running outpatient care. The newer designation, with its accompanying financial incentives, has kept some smaller rural hospitals from closing, but Morgan said those conversions still mean a loss of services.
"It's a good thing that now we keep the emergency room care, but I think it masks the fact that 28 communities lost inpatient care just last year alone," he said. "I'm afraid that this hospital closure crisis is now going to run under the radar."
"It ends up costing local and state governments more, ultimately, and costs the federal government more, in dollars for health care treatment," Morgan said. "It's just bad public policy. And bad policy for the local communities."
If you went 'anywhere in the world,' you could get a prescription filled for 40% to 60% less than it costs in the U.S. — President Joe Biden, Feb. 22, 2024.
This article was published on Wednesday, March 6, 2024 in KFF Health News.
It's well documented that Americans pay high prices for healthcare. But do they pay double or more for prescriptions compared with the rest of the world? President Joe Biden said they did.
"If I put you on Air Force One with me, and you have a prescription — no matter what it's for, minor or major — and I flew you to Toronto or flew to London or flew you to Brazil or flew you anywhere in the world, I can get you that prescription filled for somewhere between 40 to 60% less than it costs here," Biden said Feb. 22 at a campaign reception in California.
He followed up by touting provisions in the 2022 Inflation Reduction Act to lower drug prices, including capping insulin at $35 a month for Medicare enrollees and limiting older Americans' out-of-pocket prescription spending to $2,000 a year starting in 2025. The law also authorized Medicare to negotiate prices directly with drug companies for 10 prescription drugs, a list that will expand over time.
Research has consistently found that, overall, U.S. prescription drug prices are significantly higher, sometimes two to four times as high, compared with prices in other high-income industrialized countries. Unbranded generic drugs are an exception and are typically cheaper in the U.S. compared with other countries. (Branded generics, a different category, are close to breaking even with other countries.)
However, such factors as country-specific pricing, confidential rebates, and other discounts can obscure actual prices, making comparisons harder.
"The available evidence suggests that the U.S., on average, has higher prices for prescription drugs, and that's particularly true for brand-name drugs," said Cynthia Cox, director of the Peterson-KFF Health System Tracker, which tracks trends and issues affecting U.S. healthcare system performance. "Americans also have relatively high out-of-pocket spending on prescription drugs, compared to people in similarly large and wealthy nations."
Andrew Mulcahy, a senior health economist at Rand Corp., a nonpartisan research organization, agreed that Biden's overall sentiment is on target but ignores some complexities.
He said price comparisons his team has conducted reflect the amounts wholesalers pay manufacturers for their drugs, which can differ sharply from prices consumers and their drug plans pay.
"In many of those other countries, [patients] pay nothing," Mulcahy said. "So I think that's part of the complication here when we talk about prices; there are so many different drugs, prices, and systems at work."
What International Drug Pricing Comparisons Show
A 2024 Rand study that Mulcahy led found that, across all drugs, U.S. prices were 2.78 times as high as prices in 33 other countries, based on 2022 data. The report evaluated most countries in the Organization for Economic Co-operation and Development, or OECD, a group of 38 advanced, industrialized nations.
The gap was largest for brand-name drugs, the study found, with U.S. prices averaging 4.22 times as high as those in the studied nations. After adjusting for manufacturer-funded rebates, U.S. prices for brand-name drugs remained more than triple those in other countries.
The U.S. pays less for one prescription category: unbranded, generic drugs, which are about 33% less than in other studied countries. These types of drugs account for about 90% of filled prescriptions in the U.S., yet make up only one-fifth of overall prescription spending.
"The analysis used manufacturer gross prices for drugs because net prices — the amounts ultimately retained by manufacturers after negotiated rebates and other discounts are applied — are not systematically available," a news release about the report said.
People with health insurance pay prices that include both markups and discounts negotiated with insurers. Uninsured people may pay a pharmacy's "usual and customary" price — which tends to be higher than net prices paid by others — or a lower amount using a manufacturer discount program. But many of these adjustments are confidential, making it hard to quantify how they affect net prices.
In 2021, the Government Accountability Office released an analysis of prices of 20 brand-name drugs in the U.S., Canada, Australia, and France. The study found that retail prices were more than two to four times as high as in the U.S.
Like Rand, the agency adjusted for rebates and other price concessions for its U.S. estimate, but the other countries' estimates reflected gross prices without potential discounts.
"As a result, the actual differences between U.S. prices and those of the other countries were likely larger than GAO estimates," the report said.
Another analysis by the Peterson-KFF Health System Tracker that Cox co-authored compared the prices of seven brand-name drugs in the U.S., Germany, the Netherlands, and the United Kingdom, and found that some U.S. prices were two to four times as high. For unbranded, generic drugs, the price gaps were smaller.
"Despite the fact that the U.S. pays less for generic drugs and Americans appear to use more generic drugs than people in other countries, this did not offset the higher prices paid for brand-name drugs," Cox said.
The Peterson-KFF report, using 2019 OECD data, found that the U.S. spent about $1,126 per person on prescription medicines, higher than any peer nation, with comparable countries spending $552. This includes spending by insurers and out-of-pocket consumer costs.
"Private and public insurance programs cover a similar share of prescription medicine spending in the U.S. compared to peer nations," the report noted. "However, the steep costs in the U.S. still contribute to high U.S. healthcare spending and are passed on to Americans in the form of higher premiums and taxpayer-funded public programs."
Why Is the U.S. Such an Outlier on Drug Pricing?
The U.S. has much more limited price negotiation with drug manufacturers; other countries often rely on a single regulatory body to determine whether prices are acceptable and negotiate accordingly. Many nations conduct public cost-benefit analyses on new drugs, comparing them with others on the market. If those studies find the cost is too high, or the health benefit too low, they'll reject the drug application. Some countries also set pricing controls
In the U.S., negotiations involve smaller government programs and thousands of separate private health plans, lowering the bargaining power.
"It's complicated. Everything in healthcare costs more here, not just [prescriptions]," said Joseph Antos, a senior fellow at the American Enterprise Institute, a conservative-leaning think tank, in an email interview. Although the government's new Medicare drug negotiation is the United States' first attempt to set drug prices, Antos noted that U.S. drug price negotiation still doesn't operate as price-setting for prescriptions in Europe does because it's limited to a few drugs and doesn't apply to Medicaid or private insurance.
Drug patents and exclusivity is another factor keeping U.S. drug prices higher, experts said, as U.S. pharmaceutical companies have amassed patents to prevent generic competitors from bringing cheaper versions to market.
Drug companies have also argued that high prices reflect research and development costs. Without higher consumer prices to offset research costs, the companies say, new medicines wouldn't be discovered or brought to market. But recent studies haven't supported that.
One 2023 study found that from 1999 to 2018, the world's largest 15 biopharmaceutical companies spent more on selling and general and administrative activities, which include marketing, than on research and development. The study also said most new medicines developed during this period offered little to no clinical benefit over existing treatments.
Our Ruling
Biden said, if you went "anywhere in the world," you could get a prescription filled for 40% to 60% less than it costs in the U.S.
He exaggerated by saying "anywhere in the world," but for comparable high-income, industrialized countries, he's mostly on target.
Research has consistently shown that Americans pay significantly higher prices overall for prescription medication, averaging between two times to four times as high, depending on the study. The U.S. pays less for unbranded, generic drugs, but those lower prices don't offset the higher prices paid for brand-name drugs, researchers said.
Factors including country-specific pricing, confidential rebates. and other discounts also obscure true consumer prices, making comparisons difficult.
Biden's statement is accurate but needs clarification and additional information. We rate it Mostly True.
PolitiFact copy chief Matthew Crowley contributed to this report.
A Maryland firm that oversees the nation's largest independent network of primary care medical practices is facing a whistleblower lawsuit alleging it cheated Medicare out of millions of dollars using billing software "rigged" to make patients appear sicker than they were.
The civil suit alleges that Aledade Inc.'s billing apps and other software and guidance provided to doctors improperly boosted revenues by adding overstated medical diagnoses to patients' electronic medical records.
"Aledade did whatever it took to make patients appear sicker than they were," according to the suit.
For example, the suit alleges that Aledade "conflated" anxiety into depression, which could boost payments by $3,300 a year per patient. And Aledade decided that patients over 65 years old who said they had more than one drink per day had substance use issues, which could bring in $3,680 extra per patient, the suit says.
The whistleblower case was filed by Khushwinder Singh in federal court in Seattle in 2021 but remained under seal until January of this year. Singh, a "senior medical director of risk and wellness product" at Aledade from January 2021 through May 2021, alleges the company fired him after he objected to its "fraudulent course of conduct," according to the suit. He declined to comment on the suit.
The case is pending and Aledade has yet to file a legal response in court. Julie Bataille, Aledade's senior vice president for communications, denied the allegations, saying in an interview that "the whole case is totally baseless and meritless."
Based in Bethesda, Maryland, Aledade helps manage independent primary care clinics and medical offices in more than 40 states, serving some 2 million people.
Aledade is one of hundreds of groups known as accountable care organizations. ACOs enjoy strong support from federal health officials who hope they can keep people healthier and achieve measurable cost savings.
Aledade was co-founded in 2014 by Farzad Mostashari, a former health information technology chief in the Obama administration, and has welcomed other ex-government health figures into its ranks. In June 2023, President Joe Biden appointed Mandy Cohen, then executive vice president at Aledade, to head the Centers for Disease Control and Prevention in Atlanta.
Aledade has grown rapidly behind hundreds of millions of dollars in venture capital financing and was valued at $3.5 billion in 2023.
Mostashari, Aledade's chief executive officer, declined to be interviewed on the record.
"As this is an active legal matter, we will not respond to individual allegations in the complaint," Aledade said in a statement to KFF Health News. "We remain focused on our top priority of delivering high-quality, value-based care with our physician partners and will defend ourselves vigorously if needed in a court of law."
The lawsuit also names as defendants 19 independent physician practices, many in small cities in Delaware, Kansas, Louisiana, North Carolina, Pennsylvania, and West Virginia. According to the suit, the doctors knowingly used Aledade software to trigger illegal billings, a practice known in the medical industry as "upcoding." None has filed an answer in court.
More than two dozen whistleblower lawsuits, some dating back more than a decade, have accused Medicare health plans of overcharging the government by billing for medical conditions not supported by patient medical records. These cases have resulted in hundreds of millions of dollars in penalties. In September 2023, Cigna agreed to pay $37 million to settle one such case, for instance.
But the whistleblower suit filed against Aledade appears to be the first to allege upcoding within accountable care organizations, which describe part of their mission as foiling wasteful spending. ACOs including Aledade made headlines recently for helping to expose an alleged massive Medicare fraud involving urinary catheters, for instance.
Finding the 'Gravy'
Singh's suit targets Aledade's use of coding software and guidance to medical practices that joined its network. Some doctors treated patients on standard Medicare through the ACO networks, while others cared for seniors enrolled in Medicare Advantage plans, according to the suit.
Medicare Advantage is a privately run alternative to standard Medicare that has surged in popularity and now cares for more than 30 million people. Aledade has sought to expand its services to Medicare Advantage enrollees.
The lawsuit alleges Aledade encouraged doctors to tack on suspect medical diagnoses that paid extra money. Aledade called it finding "the gravy sitting in the [patient's] chart," according to the suit.
The company "instructed" providers to diagnose diabetes with complications, "even if the patient's diabetes was under control or the complicating factor no longer existed," according to the suit.
Some medical practices in Delaware, North Carolina, and West Virginia billed the inflated code for more than 90% of their Medicare Advantage patients with diabetes, according to the suit.
The lawsuit also alleges that Aledade "rigged" the software to change a diagnosis of overweight to "morbid obesity," which could pay about $2,500 more per patient. Some providers coded morbid obesity for patients on traditional Medicare at 10 times the national average, according to the suit.
"This fraudulent coding guidance was known as ‘Aledade gospel,'" according to the suit, and following it "paid dividends in the form of millions of dollars in increased revenue."
These tactics "usurped" the clinical judgment of doctors, according to the suit.
'No Diagnosis Left Behind'
In its statement to KFF Health News, Aledade said its software offers doctors a range of data and guidance that helps them evaluate and treat patients.
"Aledade's independent physicians remain solely responsible for all medical decision-making for their patients," the statement read.
The company said it will "continue to advocate for changes to improve Medicare's risk adjustment process to promote accuracy while also reducing unnecessary administrative burdens."
In a message to employees and partner practices sent on Feb. 29, Mostashari noted that the Justice Department had declined to take over the False Claims Act case.
"We recently learned that the federal government has declined to join the case U.S. ex rel. Khushwinder Singh v. Aledade, Inc. et al. That's good news, and a decision we wholeheartedly applaud given the baseless allegations about improper coding practices and wrongful termination brought by a former Aledade employee three years ago. We do not yet know how the full legal situation will play out but will defend ourselves vigorously if needed in a court of law," the statement said.
The Justice Department advised the Seattle court on Jan. 9 that it would not intervene in the case "at this time," which prompted an order to unseal it, court records show. Under the false claims law, whistleblowers can proceed with the case on their own. The Justice Department does not state a reason for declining a case but has said in other court cases that doing so has no bearing on its merits.
Singh argues in his complaint that many "unsupported" diagnosis codes were added during annual "wellness visits," and that they did not result in the patients receiving any additional medical care.
Aledade maintained Slack channels in which doctors could discuss the financial incentives for adding higher-paying diagnostic codes, according to the suit.
The company also closely monitored how doctors coded as part of an initiative dubbed "no diagnosis left behind," according to the suit.
President Joe Biden is counting on outrage over abortion restrictions to help drive turnout for his reelection. Former President Donald Trump is promising to take another swing at repealing Obamacare.
But around America's kitchen tables, those are hardly the only health topics voters want to hear about in the 2024 campaigns. A new KFF tracking poll shows that healthcare tops the list of basic expenses Americans worry about — more than gas, food, and rent. Nearly 3 in 4 adults — and majorities of both parties — say they're concerned about paying for unexpected medical bills and other health costs.
"Absolutely healthcare is something on my mind," Rob Werner, 64, of Concord, New Hampshire, said in an interview at a local coffee shop in January. He's a Biden supporter and said he wants to make sure the Affordable Care Act, also known as Obamacare, is retained and that there's more of an effort to control healthcare costs.
The presidential election is likely to turn on the simple question of whether Americans want Trump back in the White House. (Nikki Haley, the former South Carolina governor and U.S. ambassador to the United Nations, remained in the race for the Republican nomination ahead of Super Tuesday, though she had lost the first four primary contests.) And neither major party is basing their campaigns on healthcare promises.
But in the KFF poll, 80% of adults said they think it's "very important" to hear presidential candidates talk about what they'd do to address healthcare costs — a subject congressional and state-level candidates can also expect to address.
"People are most concerned about out-of-pocket expenses for healthcare, and rightly so," said Andrea Ducas, vice president of health policy at the Center for American Progress, a Washington, D.C.-based progressive think tank.
Here's a look at the major healthcare issues that could help determine who wins in November.
Abortion
Less than two years after the Supreme Court overturned the constitutional right to an abortion, it is shaping up to be the biggest health issue in this election.
That was also the case in the 2022 midterm elections, when many voters rallied behind candidates who supported abortion rights and bolstered Democrats to an unexpectedly strong showing. Since the Supreme Court's decision, voters in six states — including Kansas, Kentucky, and Ohio, where Republicans control the legislatures — have approved state constitutional amendments protecting abortion access.
Polls show that abortion is a key issue to some voters, said Robert Blendon, a public opinion researcher and professor emeritus at the Harvard T.H. Chan School of Public Health. He said up to 30% across the board see it as a "personal" issue, rather than policy — and most of those support abortion rights.
"That's a lot of voters, if they show up and vote," Blendon said.
Proposals to further protect — or restrict — abortion access could drive voter turnout. Advocates are working to put abortion-related measures on the ballot in such states as Arizona, Florida, Missouri, and South Dakota this November. A push in Washington toward a nationwide abortion policy could also draw more voters to the polls, Blendon said.
A surprise ruling by the Alabama Supreme Court in February that frozen embryos are children could also shake up the election. It's an issue that divides even the anti-abortion community, with some who believe that a fertilized egg is a unique new person deserving of full legal rights and protections, and others believing that discarding unused embryos as part of the in vitro fertilization process is a morally acceptable way for couples to have children.
Pricey Prescriptions
Drug costs regularly rank high among voters' concerns.
In the latest tracking poll, more than half — 55% — said they were very worried about being able to afford prescription drugs.
Biden has tried to address the price of drugs, though his efforts haven't registered with many voters. While its name doesn't suggest landmark health policy, the Inflation Reduction Act, or IRA, which the president signed in August 2022, included a provision allowing Medicare to negotiate prices for some of the most expensive drugs. It also capped total out-of-pocket spending for prescription drugs for all Medicare patients, while capping the price of insulin for those with diabetes at $35 a month — a limit some drugmakers have extended to patients with other kinds of insurance.
Drugmakers are fighting the Medicare price negotiation provision in court. Republicans have promised to repeal the IRA, arguing that forcing drugmakers to negotiate lower prices on drugs for Medicare beneficiaries would amount to price controls and stifle innovation. The party has offered no specific alternative, with the GOP-led House focused primarily on targeting pharmacy benefit managers, the arbitrators who control most Americans' insurance coverage for medicines.
Costs of Coverage
Healthcare costs continue to rise for many Americans. The cost of employer-sponsored health plans have hit new highs in the past few months, raising costs for employers and workers alike. Experts have attributed the increase to high demand and expensive prices for certain drugs and treatments, notably weight loss drugs, as well as to medical inflation.
Meanwhile, the ACA is popular. The KFF poll found that more adults want to see the program expanded than scaled back. And a record 21.3 million people signed up for coverage in 2024, about 5 million of them new customers.
Enrollment in Republican-dominated states has grown fastest, with year-over-year increases of 80% in West Virginia, nearly 76% in Louisiana, and 62% in Ohio, according to the Centers for Medicare & Medicaid Services.
Public support for Obamacare and record enrollment in its coverage have made it politically perilous for Republicans to pursue the law's repeal, especially without a robust alternative. That hasn't stopped Trump from raising that prospect on the campaign trail, though it's hard to find any other Republican candidate willing to step out on the same limb.
"The more he talks about it, the more other candidates have to start answering for it," said Jarrett Lewis, a partner at Public Opinion Strategies, a GOP polling firm.
"Will a conversation about repeal-and-replace resonate with suburban women in Maricopa County?" he said, referring to the populous county in Arizona known for being a political bellwether. "I would steer clear of that if I was a candidate."
Biden and his campaign have pounced on Trump's talk of repeal. The president has said he wants to make permanent the enhanced premium subsidies he signed into law during the pandemic that are credited with helping to increase enrollment.
Republican advisers generally recommend that their candidates promote "a market-based system that has the consumer much more engaged," said Lewis, citing short-term insurance plans as an example. "In the minds of Republicans, there is a pool of people that this would benefit. It may not be beneficial for everyone, but attractive to some."
Biden and his allies have criticized short-term insurance plans — which Trump made more widely available — as "junk insurance" that doesn't cover care for serious conditions or illnesses.
Entitlements Are Off-Limits
Both Medicaid and Medicare, the government health insurance programs that cover tens of millions of low-income, disabled, and older people, remain broadly popular with voters, said the Democratic pollster Celinda Lake. That makes it unlikely either party would pursue a platform that includes outright cuts to entitlements. But accusing an opponent of wanting to slash Medicare is a common, and often effective, campaign move.
Although Trump has said he wouldn't cut Medicare spending, Democrats will likely seek to associate him with other Republicans who support constraining the program's costs. Polls show that most voters oppose reducing any Medicare benefits, including by raising Medicare's eligibility age from 65. However, raising taxes on people making more than $400,000 a year to shore up Medicare's finances is one idea that won strong backing in a recent poll by The Associated Press and NORC Center for Public Affairs Research.
Brian Blase, a former Trump health adviser and the president of Paragon Health Institute, said Republicans, if they win more control of the federal government, should seek to lower spending on Medicare Advantage — through which commercial insurers provide benefits — to build on the program's efficiencies and ensure it costs taxpayers less than the traditional program.
So far, though, Republicans, including Trump, have expressed little interest in such a plan. Some of them are clear-eyed about the perils of running on changing Medicare, which cost $829 billion in 2021 and is projected to consume nearly 18% of the federal budget by 2032.
"It's difficult to have a frank conversation with voters about the future of the Medicare program," said Lewis, the GOP pollster. "More often than not, it backfires. That conversation will have to happen right after a major election."
Republicans cast addiction as largely a criminal matter, associating it closely with the migration crisis at the U.S. southern border that they blame on Biden. Democrats have sought more funding for treatment and prevention of substance use disorders.
"This affects the family, the neighborhood," said Blendon, the public opinion researcher.
Billions of dollars have begun to flow to states and local governments from legal settlements with opioid manufacturers and retailers, raising questions about how to best spend that money. But it isn't clear that the crisis, outside the context of immigration, will emerge as a campaign issue.
Early in the morning of Feb. 21, Change Healthcare, a company unknown to most Americans that plays a huge role in the U.S. health system, issued a brief statement saying some of its applications were "currently unavailable."
By the afternoon, the company described the situation as a "cyber security" problem.
Since then, it has rapidly blossomed into a crisis.
The company, recently purchased by insurance giant UnitedHealth Group, reportedly suffered a cyberattack. The impact is wide and expected to grow. Change Healthcare's business is maintaining health care's pipelines — payments, requests for insurers to authorize care, and much more. Those pipes handle a big load: Change says on its website, "Our cloud-based network supports 14 billion clinical, financial, and operational transactions annually."
Initial media reports have focused on the impact on pharmacies, but techies say that's understating the issue. The American Hospital Association says many of its members aren't getting paid and that doctors can't check whether patients have coverage for care.
But even that's just a slice of the emergency: CommonWell, an institution that helps health providers share medical records, information critical to care, also relies on Change technology. The system contained records on 208 million individuals as of July 2023. Courtney Baker, CommonWell marketing manager, said the network "has been disabled out of an abundance of caution."
"It's small ripple pools that will get bigger and bigger over time, if it doesn't get solved," Saad Chaudhry, chief digital and information officer at Luminis Health, a hospital system in Maryland, told KFF Health News.
Here's what to know about the hack:
Who Did It?
Media reports are fingering ALPHV, a notorious ransomware group also known as Blackcat, which has become the target of numerous law enforcement agencies worldwide. While UnitedHealth Group has said it is a "suspected nation-state associated" attack, some outside analysts dispute the linkage. The gang has previously been blamed for hacking casino companies MGM and Caesars, among many other targets.
The Department of Justice alleged in December, before the Change hack, that the group's victims had already paid it hundreds of millions of dollars in ransoms.
Is This a New Problem?
Absolutely not. A study published in JAMA Health Forum in December 2022 found that the annual number of ransomware attacks against hospitals and other providers doubled from 2016 to 2021.
"It's more of the same, man," said Aaron Miri, the chief digital and information officer at Baptist Health in Jacksonville, Florida.
Because the assaults disable the target's computer systems, providers have to shift to paper, slowing them down and making them vulnerable to missing information.
Further, a study published in May 2023 in JAMA Network Open examining the effects of an attack on a health system found that waiting times, median length of stay, and incidents of patients leaving against medical advice all increased — at neighboring emergency departments. The results, the authors wrote, mean cyberattacks "should be considered a regional disaster."
Attacks have devastated rural hospitals, Miri said. And wherever health care providers are hit, patient safety issues follow.
What Does It Mean for Patients?
Year after year, more Americans' health data is breached. That exposes people to identity theft and medical error.
Care can also suffer. For example, a 2017 attack, dubbed "NotPetya," forced a rural West Virginia hospital to reboot its operations and hit pharma company Merck so hard it wasn't able to fulfill production targets for an HPV vaccine.
Because of the Change Healthcare attack, some patients may be routed to new pharmacies less affected by billing problems. Patients' bills may also be delayed, industry executives said. At some point, many patients are likely to receive notices their data was breached. Depending on the exact data that has been pilfered, those patients may be at risk for identity theft, Chaudhry said. Companies often offer free credit monitoring services in those situations.
"Patients are dying because of this," Miri said. Indeed, an October preprint from researchers at the University of Minnesota found a nearly 21% increase in mortality for patients in a ransomware-stricken hospital.
How Did It Happen?
The Health Information Sharing and Analysis Center, an industry coordinating group that disseminates intel on attacks, has told its members that flaws in an application called ConnectWise ScreenConnect are to blame. Exact details couldn't be confirmed.
It's a tool tech support teams use to remotely troubleshoot computer problems, and the attack is "apparently fairly trivial to execute," H-ISAC warned members. The group said it expects additional victims and advised its members to update their technology. When the attack first hit, the AHA recommended its members disconnect from systems both at Change and its corporate parent, UnitedHealth's Optum unit. That would affect services ranging from claims approvals to reference tools.
Millions of Americans see physicians and other practitioners employed by UnitedHealth and are covered by the company's insurance plans.
UnitedHealth has said only Change's systems are affected and that it's safe for hospitals to use other digital services provided by UnitedHealth and Optum, which include claims filing and processing systems.
But not many chief information officers "are jumping to reconnect," Chaudhry said. "It's an uneasy feeling."
Miri says Baptist is using the conglomerate's technology and that he trusts UnitedHealth's word that it's safe.
Where's the Federal Government?
Neither executive was sanguine about the future of cybersecurity in health care. "It's going to get worse," Chaudhry said.
"It's a shame the feds aren't helping more," Miri said. "You'd think if our nuclear infrastructure were under attack the feds would respond with more gusto."
While the departments of Justice and State have targeted the ALPHV group, the government has stayed behind the scenes more in the aftermath of this attack. Chaudhry said the FBI and the Department of Health and Human Services have been attending calls organized by the AHA to brief members about the situation.
Miri said rural hospitals in particular could use more funding for security and that agencies like the Food and Drug Administration should have mandatory standards for cybersecurity.
There's some recognition among officials that improvements need to be made.
"This latest attack is just more evidence that the status quo isn't working and we have to take steps to shore up cybersecurity in the health industry," said Sen. Mark Warner (D-Va.), the chair of the Senate Select Committee on Intelligence and a longtime advocate for stronger cybersecurity, in a statement to KFF Health News.
Debra Prichard was a retired factory worker who was careful with her money, including what she spent on medical care, said her daughter, Alicia Wieberg. "She was the kind of person who didn't go to the doctor for anything."
That ended last year, when the rural Tennessee resident suffered a devastating stroke and several aneurysms. She twice was rushed from her local hospital to Vanderbilt University Medical Center in Nashville, 79 miles away, where she was treated by brain specialists. She died Oct. 31 at age 70.
One of Prichard's trips to the Nashville hospital was via helicopter ambulance. Wieberg said she had heard such flights could be pricey, but she didn't realize how extraordinary the charge would be — or how her mother's skimping on Medicare coverage could leave the family on the hook.
Then the bill came.
The Patient: Debra Prichard, who had Medicare Part A insurance before she died.
Medical Service: An air-ambulance flight to Vanderbilt University Medical Center.
Service Provider: Med-Trans Corp., a medical transportation service that is part of Global Medical Response, an industry giant backed by private equity investors. The larger company operates in all 50 states and says it has a total of 498 helicopters and airplanes.
Total Bill: $81,739.40, none of which was covered by insurance.
What Gives: Sky-high bills from air-ambulance providers have sparked complaints and federal action in recent years.
For patients with private insurance coverage, the No Surprises Act, which went into effect in 2022, bars air-ambulance companies from billing people more than they would pay if the service were considered "in-network" with their health insurers. For patients with public coverage, such as Medicare or Medicaid, the government sets payment rates at much lower levels than the companies charge.
But Prichard had opted out of the portion of Medicare that covers ambulance services.
That meant when the bill arrived less than two weeks after her death, her estate was expected to pay the full air-ambulance fee of nearly $82,000. The main assets are 12 acres of land and her home in Decherd, Tennessee, where she lived for 48 years and raised two children. The bill for a single helicopter ride could eat up roughly a third of the estate's value, said Wieberg, who is executor.
The family's predicament stems from the complicated nature of Medicare coverage.
Prichard was enrolled only in Medicare Part A, which is free to most Americans 65 or older. That section of the federal insurance program covers inpatient care, and it paid most of her hospital bills, her daughter said.
But Prichard declined other Medicare coverage, including Part B, which handles such things as doctor visits, outpatient treatment, and ambulance rides. Her daughter suspects she skipped that coverage to avoid the premiums most recipients pay, which currently are about $175 a month.
Loren Adler, a health economist for the Brookings Institution who studies ambulance bills, estimated the maximum charge that Medicare would have allowed for Prichard's flight would have been less than $10,000 if she'd signed up for Part B. The patient's share of that would have been less than $2,000. Her estate might have owed nothing if she'd also purchased supplemental "Medigap" coverage, as many Medicare members do to cover things like coinsurance, he said.
Nicole Michel, a spokesperson for Global Medical Response, the ambulance provider, agreed with Adler's estimate that Medicare would have limited the charge for the flight to less than $10,000. But she said the federal program's payment rates don't cover the cost of providing air-ambulance services.
"Our patient advocacy team is actively engaged with Ms. Wieberg's attorney to determine if there was any other applicable medical coverage on the date of service that we could bill to," Michel wrote in an email to KFF Health News. "If not, we are fully committed to working with Ms. Wieberg, as we do with all our patients, to find an equitable solution."
The Resolution: In mid-February, Wieberg said the company had not offered to reduce the bill.
Wieberg said she and the attorney handling her mother's estate both contacted the company, seeking a reduction in the bill. She said she also contacted Medicare officials, filled out a form on the No Surprises Act website, and filed a complaint with Tennessee regulators who oversee ambulance services. She said she was notified Feb. 12 that the company filed a legal claim against the estate for the entire amount.
Wieberg said other health care providers, including ground ambulance services and the Vanderbilt hospital, wound up waiving several thousand dollars in unpaid fees for services they provided to Prichard that are normally covered by Medicare Part B.
But as it stands, Prichard's estate owes about $81,740 to the air-ambulance company.
The Takeaway: People who are eligible for Medicare are encouraged to sign up for Part B, unless they have private health insurance through an employer or spouse.
"If someone with Medicare finds that they are having difficulty paying the Medicare Part B premiums, there are resources available to help compare Medicare coverage choices and learn about options to help pay for Medicare costs," Meena Seshamani, director of the federal Center for Medicare, said in an email to KFF Health News.
In Tennessee, that counseling is offered by the State Health Insurance Assistance Program. Its director, Lori Galbreath, told KFF Health News she wishes more seniors would discuss their health coverage options with trained counselors like hers.
"Every Medicare recipient's experience is different," she said. "We can look at their different situations and give them an unbiased view of what their next best steps could be."
Counselors advise that many people with modest incomes enroll in a Medicare Savings Program, which can cover their Part B premiums. In 2023, Tennessee residents could qualify for such assistance if they made less than $1,660 monthly as a single person or $2,239 as a married couple. Many people also could obtain help with other out-of-pocket expenses, such as copays for medical services.
Wieberg, who lives in Missouri, has been preparing the family home for sale.
She said the struggle over her mother's air-ambulance bill makes her wonder why Medicare is split into pieces, with free coverage for inpatient care under Part A, but premiums for coverage of other crucial services under Part B.
"Anybody past the age of 70 is likely going to need both," she said. "And so why make it a decision of what you can afford or not afford, or what you think you're going to use or not use?"
Bill of the Month is a crowdsourced investigation by KFF Health News and NPR that dissects and explains medical bills. Do you have an interesting medical bill you want to share with us? Tell us about it!