KFF Health News

KFF Health News is a national health policy news service that is part of the nonpartisan Henry J. Kaiser Family Foundation.

GOP Takes Aim at Medicaid, Putting Enrollees and Providers at Risk

KFF Health News, February 21, 2025

Democrats, hoping to block the GOP's plans and preserve Medicaid funding, are rallying support from hospitals, governors, and consumer advocates.

This article was published on Friday, February 21, 2025 in KFF Health News.

By Phil Galewitz

Medicaid is under threat — again.

Republicans, who narrowly control Congress, are pushing proposals that could sharply cut funding to the government health insurance program for poor and disabled Americans, as a way to finance President Donald Trump's agenda for tax cuts and border security.

Democrats, hoping to block the GOP's plans and preserve Medicaid funding, are rallying support from hospitals, governors, and consumer advocates.

At stake is coverage for roughly 79 million people enrolled in Medicaid and its related Children's Health Insurance Program. So, too, is the financial health of thousands of hospitals and community health centers — and a huge revenue source to all states.

On Feb. 13, the House Budget Committee voted to seek at least $880 billion in mandatory spending cuts on programs overseen by the House Energy and Commerce Committee. That committee oversees Medicaid, which is expected to bear much of the cuts.

Senate Republicans, working on their own plan, have not proposed similar deep cuts. Sen. Ron Wyden of Oregon, the Finance Committee's top Democrat, said he expects "an effort to keep the Medicaid cuts hidden behind the curtain, but they're going to come sooner or later."

Since Trump took office, Republicans in Washington have discussed making changes to Medicaid, particularly by requiring that enrollees prove they are working. Because most enrollees already work, go to school, or serve as caregivers or have a disability, critics say such a requirement would simply add red tape to obtaining coverage, with little impact on employment.

Other GOP ideas that could gain traction toward meeting budget-cutting goals include reducing the federal government's share of costs for certain enrollees or for the program overall.

Both Trump and House Speaker Mike Johnson say they are only trying to cut what they describe as "waste, fraud, and abuse" in the program, but have yet to offer examples or specifics.

Trump has said he would "love and cherish" Medicaid along with Medicare. During a Fox News interview that aired Feb. 18, Trump repeated his assurance that Medicaid, along with Social Security and Medicare, was not "going to be touched."

Known as the workhorse of the U.S. health system, Medicaid covers Americans from the beginning of life to the end — paying for 4 in 10 births and care costs for more than 60% of nursing home residents. The program operates as a state-federal partnership, with the federal government paying most of the money and matching state funds regardless of how many people enroll.

Medicaid, which turns 60 this summer, was created as part of President Lyndon B. Johnson's "Great Society" strategy to attack poverty along with Medicare, the federal health insurance program for people 65 and older.

In today's era of extreme partisanship on Capitol Hill, few topics highlight the ideological chasm between the major political parties better than Medicaid.

Unlike Democrats who view Medicaid as a way to ensure health care is affordable and accessible regardless of income, many Republicans in Washington see Medicaid as a broken and wasteful welfare program that's grown too big and covers millions of adults who don't deserve the government assistance. Many Republicans in Congress say "able-bodied" adults could get coverage from a job or by purchasing insurance on their own.

Nearly all Republicans opposed the 2010 Affordable Care Act, which expanded Medicaid by offering coverage to millions of low-income adults and helped edge the country closer to Democrats' long-sought goal of all Americans having health coverage. In exchange for expanding Medicaid, the federal government offered states a larger funding match to cover those individuals.

But while most Republican-controlled states accepted the federal expansion dollars — some only after voters approved ballot initiatives in favor of Medicaid expansion — GOP leaders in Congress have remained steadfastly against the program's growth.

When Republicans last controlled Congress and the White House, the party sought big cuts to Medicaid as part of efforts in 2017 to repeal and replace the ACA. That campaign failed by a razor-thin margin, partly due to concerns from some congressional Republicans over how it would harm Medicaid and the private industry of health plans and hospitals that benefit from it.

Now, a more conservative GOP caucus has again put a bull's-eye on Medicaid's budget, which has grown by at least $300 billion in eight years due largely to the covid pandemic and the decision by more states to expand Medicaid. The House budget plan seeks to free up $4.5 trillion to renew Trump's 2017 tax cuts, which expire at the end of this year.

"Medicaid is increasingly caught in the middle of partisan polarization in Washington," said Jonathan Oberlander, a health policy professor at the University of North Carolina and the editor of the Journal of Health Politics, Policy and Law. "This is not just resistance to the ACA's Medicaid expansion; it is a broader change in the politics of Medicaid that puts the program in a more precarious place."

Medicaid presents a tempting target for Republicans for several reasons beyond its sheer size, Oberlander said. "The first is fiscal arithmetic: They need Medicaid savings to help pay for the costs of extending the 2017 tax cuts," he said, noting Trump has taken off the table cuts to Medicare, Social Security, and national defense — the other most costly government programs.

The GOP cuts would also help scale back the program, which covered 93 million people at its apex during the covid pandemic, when states were prohibited for three years from terminating coverage for any enrollee. Oberlander said the cuts also would allow Republicans to strike a blow against the ACA, often called Obamacare.

Republicans' latest revamping effort comes as Medicaid expansion has become entrenched in most states — and their budgets — over the past decade. Without federal expansion dollars, states would struggle to afford coverage for low-income people on the program without raising taxes, cutting benefits, or slashing spending on other programs such as education.

And since Trump's first-term effort to cut Medicaid, additional red states such as Utah, Oklahoma, Idaho, and Missouri have expanded the program, helping drop the nation's uninsured rate to a record low in recent years.

Medicaid is popular. About 3 in 4 Americans view the program favorably, according to a January 2025 KFF poll. That's similar to polling from 2017.

Here are a few strategies the GOP reportedly is considering to reduce the size of Medicaid:

Cutting ACA Medicaid funding. Through Medicaid expansion, the ACA provided financing for the program to cover adults with incomes up to 138% of the federal poverty level, or $21,597 for an individual. The federal government pays 90% of the cost for adults covered through the expansion, which 40 states and Washington, D.C., have adopted. The GOP could lower that funding to the same match rate the federal government pays states for everyone else in the program, which averages about 60%.

Shifting to block or per capita grants. Either of these two proposals could lower federal funding for states to operate Medicaid while giving states more discretion over how to spend the money. Annual block grants would give states a set amount, regardless of the number of enrollees. Per capita grants would pay the states based on the number of enrollees in each state. Currently, the federal government matches a certain percentage of state spending each year with no cap. Limiting the federal funding would hamper Medicaid's ability to help states during difficult economic times, when demand for coverage rises with falling employment and incomes, while states also have fewer tax dollars to spend.

Adding work requirements. Republicans in Washington are looking to insert work requirements into federal law. During Trump's first term, his administration allowed several states to condition coverage for adults on whether they were working, unless they met exemptions such as caregiving or going to school. Arkansas became the first to implement the measure, leading to 18,000 people losing coverage there. Federal judges ruled in 2018 that Medicaid law does not allow for work requirements in the program, which stopped efforts by Trump and several states to impose them in his first term. Several states are taking steps to add a requirement, including Ohio and Montana.

Lawrence Jacobs, founder and director of the University of Minnesota's Center for the Study of Politics and Governance, said Republicans will face challenges within their own ranks to make major Medicaid cuts, noting House members may be hesitant to cut Medicaid if warned it could lead to hospital closures in their district.

America's Essential Hospitals, a trade group representing safety-net hospitals that treat the disadvantaged, is encouraging its members to reach out to their lawmakers to make sure they know not only the cuts' potential impact on patients, but also how they could lead to job cuts and service reductions affecting entire communities.

"The level of cuts being discussed would be incredibly damaging and catastrophic for our hospitals," said Beth Feldpush, the group's senior vice president of policy and advocacy.

Said Jacobs: "The politics of cutting Medicaid is really quite fraught, and it's hard to make a prediction about what will happen at this point."

We'd like to speak with current and former personnel from the Department of Health and Human Services or its component agencies who believe the public should understand the impact of what's happening within the federal health bureaucracy. Please message KFF Health News on Signal at (415) 519-8778 or get in touch here.

Phil Galewitz: pgalewitz@kff.org, @philgalewitz

Deny and Delay? California Seeks Penalties for Insurers that Repeatedly Get It Wrong

KFF Health News, February 19, 2025

Experts say it could be one of the boldest attempts in the nation to rein in health insurer denials, before and after care is given.

This article was published on Wednesday, February 19, 2025 in KFF Health News.

By Christine Mai-Duc

When Colleen Henderson's 3-year-old daughter complained of pain while using the bathroom, doctors brushed it off as a urinary tract infection or constipation, common maladies in the potty-training years.

After being told her health insurance wouldn't cover an ultrasound, Henderson charged the $6,000 procedure to her credit card. Then came the news: There was a grapefruit-sized tumor in her toddler's bladder.

That was in 2009. The next five years, Henderson said, became a protracted battle against her insurer, UnitedHealthcare, over paying for the specialists who finally diagnosed and treated her daughter's rare condition, inflammatory pseudotumor. She appealed uncovered hospital stays, surgeries, and medication to the insurer and state regulators, to no avail. The family racked up more than $1 million in medical debt, she said, because the insurer told her treatments recommended by doctors were unnecessary. The family declared bankruptcy.

"If I had not fought tooth and nail every step of the way, my daughter would be dead," said Henderson, of Auburn, California, whose daughter eventually recovered and is now a thriving 20-year-old junior at Oregon State University. "You pay a lot of money to have health insurance, and you hope that your health insurance has your well-being at the forefront, but that's not happening at all."

While insurance denials are on the rise, surveys show few Americans appeal them. Unlike in Henderson's case, various analyses have found that many who escalate complaints to government regulators successfully get denials overturned. Consumer advocates and policymakers say that's a clear sign insurance companies routinely deny care they shouldn't. Now a proposal in the California Legislature seeks to penalize insurers who repeatedly make the wrong call.

While the measure, SB 363, would cover only about a third of insured Californians whose health plans are regulated by the state, experts say it could be one of the boldest attempts in the nation to rein in health insurer denials — before and after care is given. And California could become one of only a handful of states that require insurers to disclose denial rates and reasoning, statistics the industry often considers proprietary information.

The measure also seeks to force insurers to be more judicious with denials and would fine them up to $1 million per case if more than half of appeals filed with regulators are overturned in a year.

In 2023, state data show, about 72% of appeals made to the Department of Managed Health Care, which regulates the vast majority of health plans, resulted in an insurer's initial denial being reversed.

"When you have health insurance, you should have confidence that it's going to cover your health care needs," said Sen. Scott Wiener, the San Francisco Democrat who introduced the bill. "They can just delay, deny, obstruct, and, in many cases, avoid having to cover medically necessary care, and it's unacceptable."

A spokesperson for the California Association of Health Plans declined to comment, saying the group was still reviewing the bill language. Gov. Gavin Newsom's spokesperson Elana Ross said his office generally does not comment on pending legislation.

Concerned about spiraling consumer health costs, state lawmakers across the nation have increasingly looked for ways to verify that insurers are paying claims fairly.

In 2024, 17 states enacted legislation dealing with prior authorization of care by private insurers, according to the National Conference of State Legislatures. Connecticut, which has one of the most robust denial rate disclosure laws, publishes an annual report card detailing the number and percentage of claims each insurer has denied, as well as the share that ends up getting reversed. Oregon published similar information until recently, when state disclosure requirements lapsed.

In California, there's no way to know how often insurers deny care, which health experts say is especially troubling as mental health care is reaching crisis levels among children and young adults. According to Keith Humphreys, a health policy professor at Stanford University, it's easier to deny mental health care because a diagnosis of, say, depression can be more subjective than that of a broken limb or cancer.

"We think it's unacceptable that the state has absolutely no idea how big of a problem this is," said Lishaun Francis, senior director of behavioral health for the advocacy group Children Now, a sponsor of the bill.

Under Wiener's proposal, private insurers regulated by the Department of Managed Health Care and the Department of Insurance would be required to submit detailed data about denials and appeals. They would also need to explain those denials and report the outcomes of the appeals.

For appeals that make it to the state's independent medical review process, known as IMR, insurers whose denials are overturned more than half the time would face staggering penalties. The first case that brings a company above the 50% threshold would trigger a fine of $50,000, with a penalty ranging from $100,000 to $400,000 for a second. Each one after that would cost $1 million.

If passed, the measure would cover roughly 12.8 million Californians on private insurance. It would not apply to patients on Medi-Cal, the state's Medicaid program, or Medicare, and it would exclude self-insured plans offered by large employers, which are regulated by the U.S. Department of Labor and cover roughly 5.6 million Californians.

The phrase "deny and delay" continues to reverberate across the health care industry after the killing of UnitedHealthcare CEO Brian Thompson. A survey by NORC at the University of Chicago released shortly after the brazen attack revealed that 7 in 10 people said they believed denials for health coverage and profits by health insurance companies bore a great deal or a moderate amount of responsibility for Thompson's death.

Following Thompson's death, UnitedHealthcare said in statements that "highly inaccurate and grossly misleading information" had been circulated about the way the company treats claims and that insurers, which are highly regulated, "typically have low- to mid-single digit margins."

Wiener called Thompson's killing a "cold-blooded assassination" but said his bill grew out of a narrower proposal that failed last year aimed at improving mental health coverage for children and adults under age 26. But he acknowledged the nation's reaction to the killing underscores the long-simmering anger many Americans feel about health insurers' practices and the urgent need for reform.

Humphreys, the Stanford professor, said the U.S. health system creates strong financial incentives for insurers to deny care. And, he added, state and federal penalties are paltry enough to be written off as a cost of doing business.

"The more care they deny, the more money they make," he said.

Increasingly, large employers are starting to include language in contracts with claim administrators that would penalize them for approving too many or too few claims, said Shawn Gremminger, president of the National Alliance of Healthcare Purchaser Coalitions.

Gremminger represents mostly large employers who fund their own insurance, are federally regulated, and would be excluded from Wiener's bill. But even for such so-called self-funded plans, it can be nearly impossible to determine denial rates for the insurance companies hired simply to administer claims, he said.

While it could be too late for many families, Sandra Maturino, of Rialto, said she hopes lawmakers tackle insurance denials so other Californians can avoid the saga she endured to get her niece treatment.

She adopted the girl, now 13, after her sister died. Her niece had long struggled with self-harm and violent behavior, but when therapists recommended inpatient psychiatric care, her insurer, Anthem Blue Cross, would cover it for only 30 days.

For more than a year, Maturino said, her niece cycled in and out of facilities and counseling because her insurance wouldn't cover a long-term stay. Doctors tested a laundry list of prescription drugs and doses. None of it worked.

Anthem declined a request for comment.

Eventually, Maturino got her niece into a residential program in Utah, paid for by the adoption agency, where she was diagnosed with bipolar disorder and has been undergoing treatment for a year.

Maturino said she didn't have the energy to appeal to Anthem. "I wasn't going to wait around for the insurance to kill her, or for her to hurt somebody," Maturino said.

This article was produced by KFF Health News, which publishes California Healthline, an editorially independent service of the California Health Care Foundation.

Christine Mai-Duc: CMaiDuc@kff.org, @cmaiduc

Pain Clinics Made Millions From 'Unnecessary' Injections Into 'Human Pin Cushions'

KFF Health News, February 18, 2025

Pain MD's injections have been proved in court to be part of a decade-long fraud scheme.

This article was published on Tuesday, February 18, 2023 in KFF Health News.

By Brett Kelman

McMINNVILLE, Tenn. — Each month, Michelle Shaw went to a pain clinic to get the shots that made her back feel worse — so she could get the pills that made her back feel better.

Shaw, 56, who has been dependent on opioid painkillers since she injured her back in a fall a decade ago, said in both an interview with KFF Health News and in sworn courtroom testimony that the Tennessee clinic would write the prescriptions only if she first agreed to receive three or four "very painful" injections of another medicine along her spine.

The clinic claimed the injections were steroids that would relieve her pain, Shaw said, but with each shot her agony would grow. Shaw said she eventually tried to decline the shots, then the clinic issued an ultimatum: Take the injections or get her painkillers somewhere else.

"I had nowhere else to go at the time," Shaw testified, according to a federal court transcript. "I was stuck."

Shaw was among thousands of patients of Pain MD, a multistate pain management company that was once among the nation's most prolific users of what it referred to as "tendon origin injections," which normally inject a single dose of steroids to relieve stiff or painful joints. As many doctors were scaling back their use of prescription painkillers due to the opioid crisis, Pain MD paired opioids with monthly injections into patients' backs, claiming the shots could ease pain and potentially lessen reliance on painkillers, according to federal court documents.

Now, years later, Pain MD's injections have been proved in court to be part of a decade-long fraud scheme that made millions by capitalizing on patients' dependence on opioids. The Department of Justice has successfully argued at trial that Pain MD's "unnecessary and expensive injections" were largely ineffective because they targeted the wrong body part, contained short-lived numbing medications but no steroids, and appeared to be based on test shots given to cadavers — people who felt neither pain nor relief because they were dead.

Four Pain MD employees have pleaded guilty or been convicted of health care fraud, including company president Michael Kestner, who was found guilty of 13 felonies at an October trial in Nashville, Tennessee. According to a transcript from Kestner's trial that became public in December, witnesses testified that the company documented giving patients about 700,000 total injections over about eight years and said some patients got as many as 24 shots at once.

"The defendant, Michael Kestner, found out about an injection that could be billed a lot and paid well," said federal prosecutor James V. Hayes as the trial began, according to the transcript. "And they turned some patients into human pin cushions."

The Department of Justice declined to comment for this article. Kestner's attorneys either declined to comment or did not respond to requests for an interview. At trial, Kestner's attorneys argued that he was a well-intentioned businessman who wanted to run pain clinics that offered more than just pills. He is scheduled to be sentenced on April 21 in a federal court in Nashville.

According to the transcript of Kestner's trial, Shaw and three other former patients testified that Pain MD's injections did not ease their pain and sometimes made it worse. The patients said they tolerated the shots only so Pain MD wouldn't cut off their prescriptions, without which they might have spiraled into withdrawal.

"They told me that if I didn't take the shots — because I said they didn't help — I would not get my medication," testified Patricia McNeil, a former patient in Tennessee, according to the trial transcript. "I took the shots to get my medication."

In her interview with KFF Health News, Shaw said that often she would arrive at the Pain MD clinic walking with a cane but would leave in a wheelchair because the injections left her in too much pain to walk.

"That was the pain clinic that was supposed to be helping me," Shaw said in her interview. "I would come home crying. It just felt like they were using me."

'Not Actually Injections Into Tendons at All'

Pain MD, which sometimes operated under the name Mid-South Pain Management, ran as many as 20 clinics in Tennessee, Virginia, and North Carolina throughout much of the 2010s. Some clinics averaged more than 12 injections per patient each month, and at least two patients each received more than 500 shots in total, according to federal court documents.

All those injections added up. According to Medicare data filed in federal court, Pain MD and Mid-South Pain Management billed Medicare for more than 290,000 "tendon origin injections" from January 2010 to May 2018, which is about seven times that of any other Medicare biller in the U.S. over the same period.

Tens of thousands of additional injections were billed to Medicaid and Tricare during those same years, according to federal court documents. Pain MD billed these government programs for about $111 per injection and collected more than $5 million from the government for the shots, according to the court documents.

More injections were billed to private insurance too. Christy Wallace, an audit manager for BlueCross BlueShield of Tennessee, testified that Pain MD billed the insurance company about $40 million for more than 380,000 injections from January 2010 to March 2013. BlueCross paid out about $7 million before it cut off Pain MD, Wallace said.

These kinds of enormous billing allegations are not uncommon in health care fraud cases, in which fraudsters sometimes find a legitimate treatment that insurance will pay for and then overuse it to the point of absurdity, said Don Cochran, a former U.S. attorney for the Middle District of Tennessee.

Tennessee alone has seen fraud allegations for unnecessary billing of urine testing, skin creams, and other injections in just the past decade. Federal authorities have also investigated an alleged fraud scheme involving a Tennessee company and hundreds of thousands of catheters billed to Medicare, according to The Washington Post, citing anonymous sources.

Cochran said the Pain MD case felt especially "nefarious" because it used opioids to make patients play along.

"A scheme where you get Medicare or Medicaid money to provide a medically unnecessary treatment is always going to be out there," Cochran said. "The opioid piece just gives you a universe of compliant people who are not going to question what you are doing."

"It was only opioids that made those folks come back," he said.

The allegations against Pain MD became public in 2018 when Cochran and the Department of Justice filed a civil lawsuit against the company, Kestner, and several associated clinics, alleging that Pain MD defrauded taxpayers and government insurance programs by billing for "tendon origin injections" that were "not actually injections into tendons at all."

Kestner, Pain MD, and several associated clinics have each denied all allegations in that lawsuit, which is ongoing.

Scott Kreiner, an expert on spine care and pain medicine who testified at Kestner's criminal trial, said that true tendon origin injections (or TOIs) typically are used to treat inflamed joints, like the condition known as "tennis elbow," by injecting steroids or platelet-rich plasma into a tendon. Kreiner said most patients need only one shot at a time, according to the transcript.

But Pain MD made repeated injections into patients' backs that contained only lidocaine or Marcaine, which are anesthetic medications that cause numbness for mere hours, Kreiner testified. Pain MD also used needles that were often too short to reach back tendons, Kreiner said, and there was no imaging technology used to aim the needle anyway. Kreiner said he didn't find any injections in Pain MD's records that appeared medically necessary, and even if they had been, no one could need so many.

"I simply cannot fathom a scenario where the sheer quantity of TOIs that I observed in the patient records would ever be medically necessary," Kreiner said, according to the trial transcript. "This is not even a close call."

Jonathan White, a physician assistant who administered injections at Pain MD and trained other employees to do so, then later testified against Kestner as part of a plea deal, said at trial that he believed Pain MD's injection technique was based on a "cadaveric investigation."

According to the trial transcript, White said that while working at Pain MD he realized he could find no medical research that supported performing tendon origin injections on patients' backs instead of their joints. When he asked if Pain MD had any such research, White said, an employee responded with a two-paragraph letter from a Tennessee anatomy professor — not a medical doctor — that said it was possible to reach the region of back tendons in a cadaver by injecting "within two fingerbreadths" of the spine. This process was "exactly the procedure" that was taught at Pain MD, White said.

During his own testimony, Kreiner said it was "potentially dangerous" to inject a patient as described in the letter, which should not have been used to justify medical care.

"This was done on a dead person," Kreiner said, according to the trial transcript. "So the letter says nothing about how effective the treatment is."

Over-Injecting 'Killed My Hand'

Pain MD collapsed into bankruptcy in 2019, leaving some patients unable to get new prescriptions because their medical records were stuck in locked storage units, according to federal court records.

At the time, Pain MD defended the injections and its practice of discharging patients who declined the shots. When a former patient publicly accused the company of treating his back "like a dartboard," Pain MD filed a defamation lawsuit, then dropped the suit about a month later.

"These are interventional clinics, so that's what they offer," Jay Bowen, a then-attorney for Pain MD, told The Tennessean newspaper in 2019. "If you don't want to consider acupuncture, don't go to an acupuncture clinic. If you don't want to buy shoes, don't go to a shoe store."

Kestner's trial told another story. According to the trial transcript, eight former Pain MD medical providers testified that the driving force behind Pain MD's injections was Kestner himself, who is not a medical professional and yet regularly pressured employees to give more shots.

One nurse practitioner testified that she received emails "every single workday" pushing for more injections. Others said Kestner openly ranked employees by their injection rates, and implied that those who ranked low might be fired.

"He told me that if I had to feed my family based on my productivity, that they would starve," testified Amanda Fryer, a nurse practitioner who was not charged with any crime.

Brian Richey, a former Pain MD nurse practitioner who at times led the company's injection rankings, and has since taken a plea deal that required him to testify in court, said at the trial that he "performed so many injections" that his hand became chronically inflamed and required surgery.

"‘Over injecting killed my hand,'" Richey said on the witness stand, reading a text message he sent to another Pain MD employee in 2017, according to the trial transcript. "‘I was in so much pain Injecting people that didnt want it but took it to stay a patient.'"

"Why would they want to stay there?" a prosecutor asked.

"To keep getting their narcotics," Richey responded, according to the trial transcript.

Throughout the trial, defense attorney Peter Strianse argued that Pain MD's focus on injections was a result of Kestner's "obsession" with ensuring that the company "would never be called a pill mill."

Strianse said that Kestner "stayed up at night worrying" about patients coming to clinics only to get opioid prescriptions, so he pushed his employees to administer injections, too.

"Employers motivating employees is not a crime," Strianse said at closing arguments, according to the court transcript. "We get pushed every day to perform. It's not fraud; it's a fact of life."

Prosecutors insisted that this defense rang hollow. During the trial, former employees had testified that most patients' opioid dosages remained steady or increased while at Pain MD, and that the clinics did not taper off the painkillers no matter how many injections were given.

"Giving them injections does not fix the pill mill problem," federal prosecutor Katherine Payerle said during closing arguments, according to the trial transcript. "The way to fix being a pill mill is to stop giving the drugs or taper the drugs."

Brett Kelman: bkelman@kff.org, @BrettKelman

As States Mull Medicaid Work Requirements, Two Scale Theirs Back

KFF Health News, February 14, 2025

More than a dozen states had Medicaid work requirement programs approved during Trump's first administration.

This article was published on Friday, February 14, 2025 in KFF Health News.

By Renuka Rayasam and Sam Whitehead

President Donald Trump's return to the White House sent a clear signal about Medicaid to Republicans across the country: Requiring enrollees to prove they are working, volunteering, or going to school is back on the table.

The day after Trump's inauguration, South Carolina GOP Gov. Henry McMaster asked federal officials to approve a work requirement plan. Ohio Republican Gov. Mike DeWine plans to soon follow suit. Republicans in Congress are eyeing Medicaid work requirements as they seek to slash billions from the federal budget.

But, just as a second Trump administration reignites interest in work requirements, Georgia is proposing to scale back key parts of the nation's only active program. And Arkansas announced an effort to revive — with fundamental changes — a program that ended after a legal judgment in 2019.

The Georgia and Arkansas proposals, from the only two states to have implemented Medicaid work requirements, reveal the disconnect between rhetoric behind such programs and the realities of running them, said consumer advocates and health policy researchers.

"They recognize that what they did the first time didn't work," said Ben Sommers, a Harvard professor and a former health official in the Biden and Obama administrations. "It should be a signal to federal policymakers: Don't point to Georgia and Arkansas and say, 'Let's do that.'"

More than a dozen states had Medicaid work requirement programs approved during Trump's first administration.

After an expensive and bumpy rollout, Georgia in January posted a draft renewal plan for its Georgia Pathways to Coverage program. The plan removes the requirement to document work every month and to pay premiums. Those key elements — which supporters have argued promote employment and personal responsibility — were never implemented, the state said.

Enrollees would still have to meet the work requirement when they first apply and when they renew each year. The draft plan also expands the group of people who can opt out of work reporting to include parents of children under age 6. A public comment period on the plan is open through Feb. 20.

Arkansas' latest request to federal officials doesn't require enrollees to report their work hours. Instead, it proposes checking whether people are working, caregiving, or fulfilling other qualifying activities by using data, which could include income, job history, educational status, whether a child lives at home, and other criteria, said Gavin Lesnick, a spokesperson for the state's Medicaid agency.

People deemed "not on track towards meeting their personal health and economic goals" won't be disenrolled but can participate in a "success coaching" program to maintain coverage, according to the state's proposal. A public comment period on Arkansas' program runs through March 3.

'Fundamentally Flawed'

More than 90% of U.S. adults eligible for Medicaid expansion are already working or could be exempt from requirements, according to KFF. Still, several states are quickly moving to restart Medicaid work requirements.

Besides the three states of Arkansas, Ohio, and South Carolina, Iowa and South Dakota are considering similar proposals. Lawmakers in Montana are weighing them as they debate renewing the state's Medicaid expansion.

This week, House Republicans floated a budget proposal to cut $880 billion from the Energy and Commerce Committee, which oversees Medicaid, the state-federal health insurance program for people with low incomes or disabilities. Before the release of that plan, Speaker Mike Johnson said Republicans were discussing changes to Medicaid that include imposing work requirements.

Supporters of such requirements say Medicaid should be reserved for people who are working.

Right now, it "disincentivizes many low-income families from earning additional income" because they would lose health coverage if they make too much money, said South Carolina Gov. McMaster in his January letter to federal officials. He has argued that a work-reporting requirement is "fiscally responsible" and "will incentivize employment."

There is no evidence showing such programs improve economic outcomes for people; the requirements don't help people find jobs, but not having health insurance can keep them from working, health policy researchers say.

The goal of Ohio's plan is to focus "resources and efforts on those who are engaged with their health choices and independence," said the state. The plan doesn't require most individuals to regularly "report activities, fill out forms, or take any action" beyond what is generally required for Medicaid enrollment. Ohio estimates that more than 61,000 people, or 8% of enrollees subject to its measure, would lose Medicaid eligibility in the first year.

Consumer advocates, health policy analysts, and researchers said the scaling back seen in recent work requirement proposals speaks to the challenges of mandating them for public benefits — and could serve as a cautionary tale for Republicans in Washington, D.C., and across the country. The programs can eliminate people from the Medicaid rolls or suppress enrollment, while adding costly layers of bureaucracy, they said.

"As a matter of health policy, work-reporting requirements in Medicaid are fundamentally flawed," said Leo Cuello, a researcher at the Georgetown Center for Children and Families.

Lessons Learned?

Arkansas got its initial program off the ground in 2018 before a federal judge said it was illegal. Unlike Georgia, the state had already expanded Medicaid. That work-reporting requirement led to more than 18,000 people losing coverage, in part because enrollees were unaware or confused about how to report they were working.

In his ruling that ended the program, Judge James Boasberg said its approval was "arbitrary and capricious" because it failed to address a core goal of Medicaid: "the provision of medical coverage to the needy."

Arkansas' latest proposal tries to address a potential legal challenge by suspending, rather than terminating, health coverage through the end of the calendar year for people who don't meet requirements.

"We have worked to design this amendment taking into account lessons learned from previous work requirements," said Arkansas Medicaid Director Janet Mann at a press conference in late January announcing the new proposal.

But the requirements are "subjective," and the difference between suspension and termination isn't meaningful, said Camille Richoux, health policy director of Arkansas Advocates for Children and Families.

"The impact is the same: You can't go to the doctor," she said. "You can't get your prescriptions filled."

In Georgia, the Pathways program, launched in 2023, has offered coverage to a small portion of those who would qualify for Medicaid if the state had fully expanded it to all low-income adults, as 40 others have done. With the proposed changes, the state estimates enrollment in Pathways would grow to as many as 30,000 people in the final year of the pilot. The state currently estimates at least 246,000 would become eligible for Medicaid under a full expansion.

About 6,500 people were enrolled in Pathways as of late January, said Grant Thomas, the state's deputy Medicaid commissioner, in a legislative hearing. According to state officials, the program has cost more than $57 million in state and federal funds through December, with most of that money going toward program administration, not benefits.

"Pathways is doing what it is designed to do: increase access to affordable health care coverage while lowering the uninsured rate across Georgia," said Russel Carlson, the state's Medicaid director. The changes to Pathways are an attempt to "improve the member experience" while finding ways "to make government more efficient and accessible," he added.

Pathways requires that enrollees regularly submit documentation to prove they are working, but the program doesn't include meaningful measures to help people find work, critics said. People who could be eligible for Pathways have said the whole process is time-consuming due to lengthy questionnaires, a glitchy system for uploading documents, and confusing technical language on the website, according to those working with potential enrollees.

"There's stuff that sounds good on paper, but when you go to implement it in real life, it's costly and burdensome," said Leah Chan, director of health justice at the Georgia Budget and Policy Institute.

So far, Pathways has cost state and federal taxpayers nearly $9,000 per enrollee, largely back-end costs to run the program. States that have expanded Medicaid spent about $6,500 per enrollee in that group in 2021, according to KFF researchers.

Georgia GOP Gov. Brian Kemp has said he's committed to his signature health program, but some Republican state lawmakers have shown an openness to consider full expansion.

A group of Democratic senators cited KFF Health News' reporting last year when they asked the federal government's top watchdog to investigate Pathways spending.

Even with the proposed changes, some people, including those who work in the informal or gig economy, may not have official records and may be locked out of health coverage, said Laura Colbert, executive director of Georgians for a Healthy Future, a nonprofit consumer health advocacy organization. People caring for older children or aging relatives, older adults who struggle to find work, and those with medical conditions that prevent them from working still wouldn't qualify for health coverage, she said.

"The Pathways program just doesn't reflect the reality of how people are working," Colbert said. "Pathways is a program that has clearly been developed by people who have had salaried jobs with predictable incomes."

Renuka Rayasam: rrayasam@kff.org, @renurayasam

Sam Whitehead: swhitehead@kff.org

Top CA Dems Clash Over How to Rein In PBMs

KFF Health News, February 13, 2025

As prescription drug prices continue to spiral and federal efforts to control them stall, state lawmakers are focusing on PBMs.

This article was published on Thursday, February 13, 2025 in KFF Health News.

By Christine Mai-Duc

California Gov. Gavin Newsom and state legislators in Sacramento seem to agree: Prescription drug prices are too high. But lawmakers and the second-term governor are at odds over what to do about it, and a recent proposal could trigger one of the biggest healthcare battles in Sacramento this year.

A California bill awaiting its first hearing would subject drug industry intermediaries known as pharmacy benefit managers, or PBMs, to licensing by the state Department of Insurance. And it would require them to pass along 100% of the rebates they get from drug companies to the health plans and insurers that hire them to oversee prescription drug benefits.

But the proposal, which would impose some of the toughest PBM regulations in the nation, faces at least one major hurdle: Newsom. He vetoed a similar measure last year, unconvinced it would lower consumer costs. He signaled his intent to offer an alternative but has yet to reveal it.

Any fight over PBM reform promises to be a pricey one. Interest groups on both sides spent at least $7 million combined lobbying California lawmakers and the Newsom administration on healthcare last year, according to records filed with the secretary of state.

"This bill directly threatens the profitability of PBMs going forward," said Ge Bai, a health policy professor at Johns Hopkins University who has tracked similar bills in other states. "These bills are really the result of an interindustry dog fight, and these are ridiculously fierce fights because PBMs control revenue for pharmacies, as well as for manufacturers."

The country's top three PBMs —CVS Caremark, affiliated with Aetna; UnitedHealth Group's Optum Rx; and Express Scripts, owned by Cigna — control roughly 80% of prescriptions in the United States, according to the Federal Trade Commission. In theory, they leverage their buying power to extract steep discounts from drug manufacturers and pass savings along to insurance companies and employers who provide health coverage.

But as prescription drug prices continue to spiral and federal efforts to control them stall, state lawmakers are focusing on PBMs, which help insurers decide which drugs their plans cover and how much patients will pay out-of-pocket to get them. However, they have been stymied by the drug industry's secretive ecosystem of rebates, reimbursements, and obscure fees, thwarting efforts to lower drug costs.

In addition to California, PBM proposals have been introduced this legislative session in Arkansas, Iowa, and at least 20 other states as of Feb. 10, according to the National Academy for State Health Policy. All 50 states and Washington, D.C., have some sort of PBM regulation on the books.

And although President Donald Trump has criticized PBMs and vowed to "knock out the middleman," his recent actions undoing moves to lower prescription drug prices have left some healthcare experts skeptical that meaningful reform will come from Washington, D.C.

Meanwhile, state data shows California health plan drug costs have grown by more than 50% since 2017. California insurers spent 11% more on pharmaceuticals in 2023 than in 2022, with specialty and brand-name drugs driving the increase.

Both Newsom and bill author Sen. Scott Wiener (D-San Francisco) have said PBMs play a role in high drug prices. While Wiener wants to ban some of their practices outright, Newsom has so far taken a more measured approach, calling for more disclosure and pointing to his plan for the state to manufacture its own generic drugs, which has yet to get off the ground.

In vetoing Wiener's 2024 bill, which passed in a near-unanimous bipartisan vote, Newsom said he was unconvinced that licensing PBMs would improve affordability for patients and instead directed his administration to "propose a legislative approach" to gather more data from PBMs. In a statement, Newsom spokesperson Elana Ross noted that "Big Pharma backed the vetoed bill" and said the Democratic governor, in partnership with the legislature, will take action to address PBMs this year. She declined to elaborate.

In his January budget proposal, Newsom said his administration was "exploring approaches to increase transparency" in the entire drug supply chain, not just PBMs.

Industry representatives say they're being unfairly targeted with transparency laws and regulations and blame pharmaceutical companies for setting high drug prices.

"The PBM is taking the risk on price variation, and it allows the client to have certainty on what they're going to be paying," said Bill Head, an assistant vice president of state affairs for the Pharmaceutical Care Management Association, which represents PBMs. "We're hired because it works. It saves money at the end of the day."

He said PBMs pass on more than 95% of the rebates they receive from drugmakers — a number health policy researchers say is hard to verify.

Consumer advocates say drugmakers simply raise their prices to maintain profits and PBMs charge insurers far more for many medicines than pharmacies are paid to actually dispense them, a practice known as spread pricing.

A January report by the Federal Trade Commission found the three biggest PBMs appeared to steer the most profitable prescriptions away from competitors and to their affiliated pharmacies, which they reimbursed at markups exceeding 1,000% for some drugs, including some used to treat cancer, multiple sclerosis, and serious lung conditions. Over a six-year period, the analysis found, those PBMs and their affiliated pharmacies made roughly $8.7 billion in additional revenue by marking up prices on a sample of 51 specialty drugs.

Wiener's latest bill, SB 41, would ban such markups, as well as spread pricing, and bar PBMs from receiving performance bonuses based on drug rebates. Similar provisions were stripped out of last year's bill in the final days before its passage.

"These are practices that only PBMs are engaging in and they're causing harm, reducing consumer choice, increasing drug costs, and it's time to address them," Wiener said. "I'm not going to let that idea just evaporate because of one veto."

Clint Hopkins, who has co-owned Pucci's Pharmacy in Sacramento since 2016, said he often deals with complaints from frustrated patients who don't understand drug pricing schemes and restrictions set by pharmacy benefit managers.

He's had to turn away customers whose drugs can cost him hundreds of dollars in losses each time they're filled and says spread pricing is helping drive independent pharmacies out of business.

"I'm not asking to be paid more. I am asking to be paid fairly — at cost or above."

Under current law, California requires PBMs to disclose some information about drug rebates, and other information, to its clients. That data is often labeled as proprietary to the companies, leaving an incomplete picture of the supply chain, said Maureen Hensley-Quinn, a senior program director at the National Academy for State Health Policy.

PBM representatives say pharmacies, insurers, and other actors in the supply chain should have to disclose information about their profits and practices, too.

"You want to look under the hood?" Head said. "We're open to that, but let's look under everybody's hood."

Bai said lawmakers are likely going after PBMs because insurers are one portion of the supply chain that they have the power to regulate. But she warned such legislation could cost consumers more if drugmakers and pharmacies remain unchecked. A better approach, Bai suggested, would be to bar PBMs entirely from managing benefits for generic drugs, one of their biggest revenue sources.

"In healthcare, there's no saint and there's no villain. Everybody's trying to make money," Bai said. "These fights will bring no benefit to patients unless we go to the root."

This article was produced by KFF Health News, which publishes California Healthline, an editorially independent service of the California Healthcare Foundation.

Christine Mai-Duc: CMaiDuc@kff.org, @cmaiduc

Montana Looks To Regulate Prior Authorization as Patients, Providers Decry Obstacles to Care

KFF Health News, February 13, 2025

Advocates say it's time Montana joined many other states in limiting how and when insurers can deny drugs or treatments through prior authorization.

This article was published on Thursday, February 13, 2025 in KFF Health News.

By Mike Dennison

HELENA, Mont. — When Lou and Lindsay Volpe's son was diagnosed with a chronic bowel disease at age 11, their health insurer required constant preapproval of drugs and treatments — a process the Volpes say often delayed critical care for their son.

"You subscribe to your insurance policy, you pay into that for years and years and years with the hope that, if you need this service, it will be there for you," Lou Volpe said. "And finally, when you knock on the door and say, ‘Hey guys, we need some help,' they just start backpedaling."

The Volpes, who live in Helena, and their health care providers spent more than 18 months pushing for these approvals from Blue Cross and Blue Shield of Montana — including a four-month wait last year for approval of costly infusions that worked to control their son's disease where other treatments had failed.

"It just really slowed everything down on his treatment, and I feel like he could have been recovering from this situation a lot sooner," Lindsay Volpe said.

Now, the Volpes, other patients, and their health care providers are bringing the issue to the 2025 Montana Legislature, saying it's time Montana joined many other states in limiting how and when insurers can deny drugs or treatments through their preapproval process, known as "prior authorization."

This month, a Democratic and a Republican lawmaker introduced or were drafting separate bills restricting health insurers' ability to require prior authorization for certain treatments and medications. A third lawmaker was preparing other measures as well.

Many of the state's medical providers are behind the effort, saying prior authorization is denying vital care and needlessly sucking up more and more of their time, which they say could be better spent with patients.

"It has increased incredibly in the last couple of decades, to the point that it's one of the leading causes of burnout for physicians," said Lauren Wilson, a Missoula pediatrician and past president of the Montana chapter of the American Academy of Pediatrics. "It's just delaying patient care for no good reason."

Montana health insurers, however, insist they are authorizing drugs and treatments that are shown to be needed. If their review power is stripped away, costs will continue to increase due to insurance paying for unnecessary treatments, they said.

Blue Cross and Blue Shield of Montana said it doesn't comment on individual cases, such as the Volpes', but said it approves the "vast majority" of prior authorization requests. Blue Cross, which insures or manages health insurance for 384,000 people in Montana, also said it regularly audits its prior authorization procedures and is taking steps to speed up the process.

"Prior authorizations are a way to ensure members receive the right care at the right place at the right time, avoiding unnecessary services and helping providers understand coverage before a service is delivered," the company said in a statement.

Denial of care through insurers' prior authorization processes has struck a nerve nationwide as well.

In the wake of the December shooting death of UnitedHealthcare CEO Brian Thompson in New York City, customers of the health insurance giant and other consumers took to social media to denounce the industry for denied claims and puny reimbursements.

And since then, one of the nation's largest health insurers, The Cigna Group, announced it would spend $150 million this year to reform its prior authorization process and related services for patients and health care providers.

In the past two years, multiple states have passed laws restricting prior authorization, according to the American Medical Association, with New Jersey enacting restrictions over New Year's. The laws, spearheaded by health care providers, generally narrow when and how prior authorization can occur and create stricter timelines for the review.

Legislators in several states, including Indiana, Nebraska, North Dakota, Virginia, and Washington, have introduced prior authorization bills this year.

In Montana, local health insurers aren't quietly giving in to increased regulation.

They note that state regulation of prior authorization affects only about a fourth of Montanans with health insurance, because large, self-insured plans managed by national health insurers are under federal rules.

State restrictions on prior authorization will increase costs primarily for three in-state insurers, they say — and, eventually, their customers.

"We feel like our job is to say, ‘Is that the best use of money for our membership?'" Jackie Boyle, senior vice president of external affairs for Mountain Health Co-Op, said of prior authorization. "If we approve something, we are doing it for every patient like them."

Mountain Health, based in Helena, insures 55,000 people in Montana, Idaho, and Wyoming.

Democratic state Rep. Jonathan Karlen of Missoula is sponsoring two bills: one to remove prior authorization for most generic drugs, inhalers, and insulin, and another that says patients can't be denied a drug when they switch insurers and are waiting for authorization from the new insurer. The second bill also says a procedure or treatment may be denied only by a physician with a matching specialty.

Karlen said insurers are putting up barriers to care to increase their profits and said it's time to break those barriers down.

"People should be making medical decisions based on what they and their doctors think, not what their insurance company thinks," he said. "If a doctor says you need a medication, that's why you have insurance — so you can get that."

Republican state Rep. Ed Buttrey of Great Falls said he plans to introduce a bill to help kids with chronic bowel diseases, such as the Volpes' son, imposing a seven-day limit to decide whether to authorize expensive biologic treatments. If insurers don't meet the deadline, the drug would be automatically approved.

Buttrey's bill also would eliminate most retroactive denials — when insurers refuse to pay for treatment they'd authorized.

State Sen. Vince Ricci (R-Billings) said he is preparing other bills that may include even stronger language to restrict prior authorization for drugs for various conditions.

Health care providers and patients have heard the rationale of insurers and promises that improvements will be made, but they say nothing has happened and that it's time for the state to step in.

"When there are no consequences and no teeth to anything, I can complain all I want, but it doesn't seem to incite change," said Kim Longcake, the pediatric nurse practitioner who's treating the Volpes' son.

Longcake said she and another specialist in her office tracked the time they spent on prior authorization requests in a two-week period.

"Depending on where you want to see me, I'm booking out four to six months," Longcake said. "If I wasn't spending 12 hours a week doing prior authorization stuff, it would improve access to care."

The Volpes said their son, now 13, couldn't absorb food and didn't gain any weight for a year and a half while he went through treatments that didn't work and repeated preauthorization waits, including for his current treatment, which appears to be working.

"What he's gone through at that age was really excessive, beyond what was needed for treatment, because we couldn't get the care that he needed," his mother said. "If we didn't get switched to this medication, he'd still be doing that."

Mike Dennison: mikedennison5@gmail.com

Doctor Wanted: Small Town Offers Big Perks to Attract a Physician

KFF Health News, February 12, 2025

Havana, Florida leaders are holding out hope of finding a family physician who can practice and prescribe medications independently.

This article was published on Wednesday, February 12, 2025 in KFF Health News.

By Daniel Chang

HAVANA, Fla. — For a rural community, this town of 1,750 people has been more fortunate than most. A family doctor has practiced here for the last 30 years.

But that ended in December when Mark Newberry retired. To attract a new doctor, Havana leaders took out want ads in local newspapers, posted notices on social media, and sweetened the pot with a rent-free medical office equipped with an X-ray, an ultrasound machine, and a bone density scanner — all owned by the town.

Local leaders hope the recruitment campaign will help attract candidates amid a nationwide shortage of doctors.

"This is important for our community," said Kendrah Wilkerson, Havana's town manager, "in the same way that parks are important and good future planning is important."

According to a Florida Department of Health report, doctor shortages affect all or part of nearly every county, but less populous counties, such as Gadsden, where Havana is located, have the fewest physicians per 10,000 residents.

Florida's doctor shortage is expected to grow in the next decade, with one study projecting a statewide need of 18,000 physicians — including 6,000 primary care doctors — by 2035.

"This is a huge, huge issue," said Matthew Smeltzer, a managing partner of Capstone Recruiting Advisors, a company that helps hospitals, physician practices, and other employers find and hire doctors. "It probably hits small towns the hardest, just because most people would prefer to live in a midsize or large community.

In this challenging environment, Havana leaders are hoping that want ads and rent-free perks will make their small town stand out and persuade a doctor to practice here.

Wilkerson describes the community, just south of the Georgia border, as an ideal place to raise a family. Its country roads are lined with farms, pastures, and churches. Main Street downtown features antique stores, gift shops, a general store, and restaurants.

"Everything you would imagine a Hallmark movie to be is kind of where we live," Wilkerson said. "It's people who still care and look out for each other, and neighbors are actually friends."

Offering generous incentives was how town leaders got Newberry to practice in Havana in 1993. The town gave Newberry an initial deal similar to the one it's offering now, and later began providing him about $15,000 a year in financial support.

Newberry, who served about 2,000 patients, declined to be interviewed. "I'm just retiring!" he said in an email, adding that "the town has chosen unconventional ways" of recruiting a doctor.

By subsidizing office space and the use of medical equipment to attract a doctor, Havana is looking out for the needs of its residents, Wilkerson said.

Without a town doctor, some of Newberry's former patients now have to travel to Tallahassee, about a 30-minute drive southeast of Havana. Others are seeing doctors in Quincy, about a 20-minute drive west.

"Our hope is that they'll come back when we find us a new doctor," Havana Mayor Eddie Bass said.

Susan Freiden, a former town manager who retired in 2006, said having a local doctor is also important to meet the needs of the town's low-income residents, many of whom are older adults. "Not everybody can get to Tallahassee to get a doctor," she said. "Not everybody has transportation."

But it remains to be seen whether rent-free office space and equipment are enough to attract a doctor to Havana. The town's recruitment campaign has drawn a lot of interest from nurse practitioners, but few primary care physicians have applied for the position.

Town leaders say they're holding out hope of finding a family physician, who can practice and prescribe medications independently.

"We would really, you know, prefer to have a true doctor that can handle it all for us," Bass said.

Smeltzer, the physician headhunter, said primary care physicians are in especially low supply. And though in his experience Florida, North Carolina, Tennessee, and Texas are among the places doctors want to live and work, it often takes something extra to persuade them to work in a small town, he said.

"If someone wants to practice in a small town, they're more likely to go to where they have ties, whether it's themselves or their spouse or significant other," he said.

The challenge for a community of Havana's size, Smeltzer said, is that "there may literally be nobody from that town that went to med school. Or, if there is, maybe it's one. But were they a primary care physician?"

Still, there is a silver lining. Smeltzer said young physicians are placing a high value on work-life balance and meaningful relationships with their patients — qualities that may give an edge to a small-town, independent practice.

"We hear quality of life and work-life balance far more in the last three to five years than we ever heard before," he said, "and that's almost in lockstep with compensation in terms of what they're focusing on."

Freiden, the former Havana town manager, said those are the same values Newberry had when he started to practice here. She even became one of his patients.

"He was just perfect," she said, "because he wasn't all about the money, if you can imagine that. He was kind of a different kind of physician."

Fortunately for Havana, the town recently received interest from a family medicine doctor who grew up here, went to medical school, and expects to finish a three-year residency at Tallahassee Memorial HealthCare in June.

Camron Browning, a 2003 graduate of Northside Havana High School, told the seven-member Town Council in a December interview that he was focusing on family medicine and that, during his residency, he has seen thousands of patients, delivered babies, and gained experience as a hospitalist.

"My goal," he said, "was to be able to come home and serve my hometown."

Smeltzer said Havana's incentives could be attractive to new doctors, such as Browning, who would face daunting startup costs to establish an independent practice.

After the December interview, the Council voted unanimously to begin contract negotiations with Browning, who said he would plan to be ready to see patients as soon as possible after completing his residency.

"I'm here to stay," Browning told the Council. "This was always my dream."

Daniel Chang: dchang@kff.org, @dchangmiami

KP Back in the Hot Seat Over Mental Health Care, but It's Not Only a KP Issue

KFF Health News, February 11, 2025

KP therapists and union reps accuse the HMO giant of saddling workers with excessive caseloads.

This article was published on Tuesday, February 11, 2025 in KFF Health News.

By Bernard J. Wolfson

For more than a decade, Kaiser Permanente has been under the microscope for shortcomings in mental health care, even as it is held in high esteem on the medical side.

In 2013, California regulators fined the insurer $4 million for failing to reduce wait times, giving patients inaccurate information, and improperly tracking appointment data. And in 2023, KP agreed to pay $50 million, the largest penalty ever levied by the state's Department of Managed Health Care, for failing to provide timely care, maintain a sufficient number of mental health providers, and oversee its providers effectively.

Now, Kaiser Permanente is back in the hot seat as mental health workers in Southern California wage a strike that's in its fourth month. KP therapists and union representatives accuse the HMO giant of saddling workers with excessive caseloads and often forcing patients to wait twice as long as the state allows for follow-up appointments. They say that the staff is burned out and that this work environment makes it hard to recruit clinicians, exacerbating the staffing problem.

KP rebuffs these claims, saying the union is parading out old problems, seeking to create "an inaccurate and outdated perception" of KP's care. They say the union's pay demands are "in direct contrast to our commitment to providing quality, affordable care."

Kaiser Permanente — the largest commercial health plan in California, with about 9 million members — is far from alone in struggling to provide adequate mental health care. A pandemic-induced shortage of health care workers has created obstacles for all health plans in recent years, on top of a preexisting scarcity. Moreover, many therapists decline to contract with insurers. And lingering bias in the health care system against mental health services — and patients — may also be at play.

Federal and state laws require health plans to provide mental health care on par with medical care. But many people who have sought therapy can vouch that those measures, known as mental health parity laws, do not seem to be followed consistently. You can spend hours or even days calling every therapist allegedly in your insurance company's network and come away empty-handed.

Secret-shopper surveys of 4,300 randomly selected outpatient providers listed as accepting new patients showed that "an alarming proportion" of them were unresponsive or unreachable, according to a federal government report issued last month. And while that was true for medical providers, it was consistently worse for mental health and substance abuse care, according to the report.

In California, state regulators have been conducting behavioral health care investigations of the insurance companies they regulate to help identify the extent and causes of delays in care.

So far, the DMHC has investigated nine health plans (not including KP) and found dozens of violations related to appointment availability, timely access, quality of care, and patient appeals, department spokesperson Rachel Arrezola says. The agency also has identified numerous "barriers" that do not necessarily break the law but may make it more difficult for patients to get care, she says.

Mark Peterson, a professor at UCLA's Luskin School of Public Affairs, notes that the open-ended nature of therapy can conflict with health plans' focus on their bottom lines. "It may be once a week, it may be more than once a week and go on for years," Peterson says.

For insurers, he says, the question is, "How do you put an appropriate limit on that?"

And the unwillingness of many therapists to accept insurance companies' payment rates, or to abide by their restrictions, often leads them to decline participation in health plan networks and charge higher rates. That, Peterson says, makes therapy financially inaccessible for a lot of people seeking it.

Even if you have some coverage for therapy outside your health plan network, your insurer will pay only a percentage of the rate that it recognizes as legitimate. "If your therapist is charging $300 an hour, and your insurance company only recognizes $150 an hour, and they only pay 50% of what they recognize, now you've got a quarter coverage of your therapy," Peterson says.

Since Kaiser Permanente is a closed system and patients don't get reimbursed for care outside the network, access problems for its patients can be "highly pronounced," Peterson adds.

In California, KP has accounted for over $54 million of the $55.7 million in mental-health-related fines the DMHC has levied on insurers in the past two decades. That includes the $50 million fine imposed in 2023, which was part of a settlement in which KP agreed to fix deficiencies the department found and to invest an additional $150 million in projects intended to enhance access to mental health care, not just for KP members, around California.

Officials at the National Union of Healthcare Workers, which represents some 2,400 KP mental health workers in the ongoing Southern California contract talks, say the HMO could easily invest enough to become a paragon of high-quality mental health care if it wanted to.

Greg Tegenkamp, the lead union negotiator, says KP could "lead the way to do the right thing."

Kaiser Permanente says it already is doing the right thing, even as it acknowledges past shortcomings. In a recent statement, it said it has invested over $1 billion in new treatment spaces and more mental health providers since 2020.

"We've grown our workforce and increased our network of skilled therapists so that any Kaiser Permanente member who needs an appointment is able to get timely, high-quality, clinically appropriate care," the company says.

In addition to higher wages and lower patient loads, workers want more time to complete follow-up tasks outside sessions and the reinstatement of a pension that was eliminated for those hired in Southern California after 2014.

Kaiser Permanente says that it already pays its mental health workers in Southern California about 18% above the market rate and that the current proposal would raise pay even more. KP recently raised its proposed wage increase by a modest amount, according to union officials.

KP refutes reports from workers about long wait times for patients seeking mental health appointments. It says the average wait time is 48 hours for urgent appointments and six business days for nonurgent ones, "which is better than the state's requirement" of no more than 10 days.

But workers say KP patients still face long delays for follow-up appointments.

"It's really hard for our patients to get regular, frequent appointments," says Kassaundra Gutierrez-Thompson, a KP therapist in Southern California who is on strike. Gutierrez-Thompson says she's seen it from both sides, since she is also a patient who sees a KP psychiatrist for depression and recently faced a big rescheduling delay after one of her appointments was canceled without notice.

As a provider, Gutierrez-Thompson says, she and her colleagues are expected to see patients "back-to-back-to-back." She says some of her colleagues developed urinary tract infections when they couldn't get to the bathroom. One even started wearing adult diapers, she says.

"The working conditions are like a factory," Gutierrez-Thompson says. "We do such human work, but they would love for us to be robots with no needs and just see patients all day."

This article was produced by KFF Health News, which publishes California Healthline, an editorially independent service of the California Health Care Foundation.

Bernard J. Wolfson: bwolfson@kff.org, @bjwolfson

Some Incarcerated Youths Will Get Health Care After Release Under New Law

KFF Health News, February 10, 2025

A new federal law aims to connect jailed children and young adults who are eligible for Medicaid or CHIP to services before release.

This article was published on Monday, February 10, 2025 in KFF Health News.

By Renuka Rayasam

Valentino Valdez was given his birth certificate, his Social Security card, a T-shirt, and khaki pants when he was released from a Texas prison in 2019 at age 21. But he didn't have health insurance, mental health medications, or access to a doctor, he said.

Three years later, he landed in an inpatient hospital after expressing suicidal thoughts.

After more than a decade cycling through juvenile detention, foster care placements, and state prisons, Valdez realizes now that treatment for his mental health conditions would have made life on his own much easier.

"It's not until you're put in, like, everyday situations and you respond adversely and maladaptive," he said, "you kind of realize that what you went through had an effect on you."

"I was struggling with a lot of mental stuff," said Valdez, now 27.

For years, people like Valdez have often been left to fend for themselves when seeking health care services after their release from jail, prison, or other carceral facilities. Despite this population's high rate of mental health problems and substance use disorders, they often return to their communities with no coverage, which increases their chances of dying or suffering a lapse that sends them back behind bars.

A new federal law aims to better connect incarcerated children and young adults who are eligible for Medicaid or the Children's Health Insurance Program to services before their release. The goal is to help prevent them from developing a health crisis or reoffending as they work to reestablish themselves.

"This could change the trajectory of their lives," said Alycia Castillo, associate director of policy for the Texas Civil Rights Project. Without that treatment, she said, many young people leaving custody struggle to reintegrate into schools or jobs, become dysregulated, and end up cycling in and out of detention facilities.

Medicaid has historically been prohibited from paying for health services for incarcerated people. So jails, prisons, and detention centers across the country have their own systems for providing health care, often funded by state and local budgets and not integrated with a public or private health system.

The new law is the first change to that prohibition since the Medicare and Medicaid Act's inception in 1965, and it came in a spending bill signed by President Joe Biden in 2022. It took effect Jan. 1 this year, and requires all states to provide medical and dental screenings to Medicaid- and CHIP-eligible youths 30 days before or immediately after they leave a correctional facility. Youths must continue to receive case management services for 30 days after their release.

More than 60% of young people who are incarcerated are eligible for Medicaid or CHIP, according to a September 2024 report from the Center for Health Care Strategies. The new law applies to children and young adults up to age 21, or 26 for those who, like Valdez, were in foster care.

Putting the law into practice, however, will require significant changes to how the country's thousands of correctional facilities provide health care to people returning to communities, and it could take months or even years for the facilities to be fully in compliance.

"It's not going to be flipping a switch," said Vikki Wachino, founder and executive director of the Health and Reentry Project, which has been helping states implement the law. "These connection points have never been made before," said Wachino, a former deputy administrator of the Centers for Medicare & Medicaid Services.

The federal CMS under the Biden administration did not respond to a question about how the agency planned to enforce the law.

It's also unclear whether the Trump administration will force states to comply. In 2018, President Donald Trump signed legislation requiring states to enroll eligible youths in Medicaid when they leave incarceration, so they don't experience a gap in health coverage. The law Biden signed built on that change by requiring facilities to provide health screenings and services to those youths, as well as ones eligible for CHIP.

Even though the number of juveniles incarcerated in the U.S. has dropped significantly over the past two decades, more than 64,000 children and young adults 20 and younger are incarcerated in state prisons, local and tribal jails, and juvenile facilities, according to estimates provided to KFF Health News by the Prison Policy Initiative, a nonprofit research organization that studies the harm of mass incarceration.

A 'Neglected Part of the Health System'

The federal Bureau of Justice Statistics estimates that about a fifth of the country's prison population spent time in foster care. Black youths are nearly five times as likely as white youths to be placed in juvenile facilities, according to the Sentencing Project, a nonprofit that advocates for reducing prison and jail populations.

Studies show that children who receive treatment for their health needs after release are less likely to reenter the juvenile justice system.

"Oftentimes what pulls kids and families into these systems is unmet needs," said Joseph Ribsam, director of child welfare and juvenile justice policy at the Annie E. Casey Foundation and a former state youth services official. "It makes more sense for kids to have their health care tied to a health care system, not a carceral system."

Yet many state and local facilities and state health agencies nationwide will have to make a lot of changes before incarcerated people can receive the services required in the law. The facilities and agencies must first create systems to identify eligible youths, find health care providers who accept Medicaid, bill the federal government, and share records and data, according to state Medicaid and corrections officials, as well as researchers following the changes.

In January, the federal government began handing out around $100 million in grants to help states implement the law, including to update technology.

Some state officials are flagging potential complications.

In Georgia, for example, the state juvenile justice system doesn't have a way to bill Medicaid, said Michelle Staples-Horne, medical director for the Georgia Department of Juvenile Justice.

In South Dakota, suspending someone's Medicaid or CHIP coverage while they are incarcerated instead of just ending it is a challenge, Kellie Wasko, the state's secretary of corrections, said in a November webinar on the new law. That's a technical change that's difficult to operationalize, she said.

State Medicaid officials also acknowledged that they can't force local officials to comply.

"We can build a ball field, but we can't make people come and play ball," said Patrick Beatty, deputy director and chief policy officer for the Ohio Department of Medicaid.

States should see the law as a way to address a "neglected part of the health system," said Wachino, the former CMS official. By improving care for people transitioning out of incarceration, states may spend less money on emergency care and on corrections, she said.

"Any state that is dragging its feet is missing an opportunity here," she said.

'Our System Is Making People Worse'

The Texas Department of Family Services took custody of Valdez when he was 8 because his mother's history of seizures made her unable to care for him, according to records. Valdez said he ran away from foster care placements because of abuse or neglect.

A few years later, he entered the Texas juvenile justice system for the first time. Officials there would not comment on his case. But Valdez said that while he was shuffled between facilities, his antidepressant and antipsychotic medications would be abruptly stopped and his records rarely transferred. He never received therapy or other support to cope with his childhood experiences, which included sexual abuse, according to his medical records.

Valdez said his mental health deteriorated while he was in custody, from being put in isolation for long periods of time, the rough treatment of officials, fears of violence from other children, and the lack of adequate health care.

"I felt like an animal," Valdez said.

In August, the U.S. Department of Justice released a report that claims the state exposes children in custody to excessive force and prolonged isolation, fails to protect them from sexual abuse, and fails to provide adequate mental health services. The Texas Juvenile Justice Department has said it is taking steps to improve safety at its facilities.

In 2024, 100% of children in Texas Juvenile Justice Department facilities needed specialized treatment, including for problems with mental health, substance use, or violent behavior, according to the department.

Too often, "our system is making people worse and failing to provide them with the continuity of care they need," said Elizabeth Henneke, founder and CEO of the Lone Star Justice Alliance, a nonprofit law firm in Texas.

Valdez said trauma from state custody shadowed his life after release. He was quick to anger and violence and often felt hopeless. He was incarcerated again before he had a breakdown that led to his hospitalization in 2022. He was diagnosed with post-traumatic stress disorder and put on medication, according to his medical records.

"It helped me understand that I wasn't going crazy and that there was a reason," he said. "Ever since then, I'm not going to say it's been easy, but it's definitely been a bit more manageable."

Renuka Rayasam: rrayasam@kff.org, @renurayasam

Blood Transfusions at the Scene Save Lives. But Ambulances Are Rarely Equipped to Do Them.

KFF Health News, February 10, 2025

Of the more than 11,000 EMS agencies in the U.S. that provide ground transport to acute care hospitals, only about 1% carry blood.

This article was published on Monday, February 10, 1015 in KFF Health News.

One August afternoon in 2023, Angela Martin's cousin called with alarming news. Martin's 74-year-old aunt had been mauled by four dogs while out for a walk near her home in rural Purlear, North Carolina. She was bleeding heavily from bites on both legs and her right arm, where she'd tried to protect her face and neck. An ambulance was on its way.

"Tell them she's on Eliquis!" said Martin, a nurse who lived an hour's drive away in Winston-Salem. She knew the blood thinner could lead to life-threatening blood loss.

When the ambulance arrived, the medics evaluated Martin's aunt and then did something few emergency medical services crews do: They gave her a blood transfusion to replace what she'd lost, stabilizing her sinking blood pressure.

The ambulance took her to the local high school, and from there a medical helicopter flew her to the nearest trauma center, in Winston-Salem. She needed more units of blood in the helicopter and at the hospital but eventually recovered fully.

"The whole situation would have been different if they hadn't given her blood right away," Martin said. "She very well might have died."

More than 60,000 people in the U.S. bleed to death every year from traumatic events like car crashes or gunshot wounds, or other emergencies, including those related to pregnancy or gastrointestinal hemorrhaging. It's a leading cause of preventable death after a traumatic event.

But many of those people likely wouldn't have died if they had received a blood transfusion promptly, trauma specialists say. At a news conference last fall, members of the American College of Surgeons estimated that 10,000 lives could be saved annually if more patients received blood before they arrived at the hospital.

"I don't think that people understand that ambulances don't carry blood," said Jeffrey Kerby, who is chair of the ACS Committee on Trauma and directs trauma and acute care surgery at the University of Alabama-Birmingham Heersink School of Medicine. "They just assume they have it."

Of the more than 11,000 EMS agencies in the U.S. that provide ground transport to acute care hospitals, only about 1% carry blood, according to a 2024 study.

The term "blood deserts" generally refers to a problem in rural areas where the nearest trauma center is dozens of miles away. But heavy traffic and other factors in suburban and urban areas can turn those areas into blood deserts, too. In recent years, several EMS agencies throughout the country have established "pre-hospital blood programs" aimed at getting blood to injured people who might not survive the ambulance ride to the trauma center.

With blood loss, every minute counts. Blood helps move oxygen and nutrients to cells and keeps organs working. If the volume gets too low, it can no longer perform those essential functions.

If someone is catastrophically injured, sometimes nothing can save them. But in many serious bleeding situations, if emergency personnel can provide blood within 30 minutes, "it's the best chance of survival for those patients," said Leo Reardon, the Field Transfusion Paramedic Program director for the Canton, Massachusetts, fire department. "They're in the early stages of shock where the blood will make the most difference."

There are several roadblocks that prevent EMS agencies from providing blood. Several states don't allow emergency services personnel to administer blood before they arrive at the hospital, said John Holcomb, a professor in the division of trauma and acute care surgery at UAB's Heersink School.

"It's mostly tradition," Holcomb said. "They say: ‘It's dangerous. You're not qualified.' But both of those things are not true."

On the battlefields in the Middle East, operators of military medical facilities would maintain that only nurses and doctors could do blood transfusions, said Randall Schaefer, a U.S. Army trauma nurse who was deployed there and now consults with states on implementing pre-hospital blood programs.

But in combat situations, "we didn't have that luxury," Schaefer said. Medical staff sometimes relied on medics who carried units of blood in their backpacks. "Medics can absolutely make the right decisions about doing blood transfusions," she said.

A quick response made a difference: Soldiers who received blood within minutes of being injured were four times as likely to survive, according to military research.

Civilian emergency services are now incorporating lessons learned by the military into their own operations.

But they face another significant hurdle: compensation. Ambulance service payments are based on how far vehicles travel and the level of services they provide, with some adjustments. But the fee schedule doesn't cover blood products. If EMS responders carry blood on calls, it's usually low-titer O whole blood, which is generally safe for anyone to receive, or blood components — liquid plasma and packed red blood cells. These products can cost from $80 to $600 on average, according to Schaefer's study. And payments don't cover the blood coolers, fluid warming equipment, and other gear needed to provide blood at the scene.

On Jan. 1, the Centers for Medicare & Medicaid Services began counting any administration of blood during ambulance pre-hospital transport as an "advanced life support, level 2" (ALS2) service, which will boost payment in some cases.

The higher reimbursement is welcome, but it's not enough to cover the cost of providing blood to a patient, which can run to more than $1,000, Schaefer said. Agencies that run these programs are paying for them out of their own operating budgets or using grants or other sources.

Blood deserts exist in rural and urban areas. Last August, Herby Joseph was walking down the stairs at his cousin's house in Brockton, Massachusetts, when he slipped and fell. The glass plate he was carrying shattered and sliced through the blood vessels in his right hand.

"I saw a flood of blood and called my cousin to call 911," Joseph, 37, remembered.

The ambulance team arrived in just a few minutes, evaluated him, and called in the Canton-based Field Transfusion Paramedic Program team, which began administering a blood transfusion shortly thereafter. The program serves 30 towns in the Boston area. Since the transfusion program began last March, the team has responded to more than 40 calls, many of them related to car accidents along the ring of interstate highways surrounding the area, Reardon said.

Brockton has a Level 3 trauma center, but Joseph's injuries required more intensive care. Boston Medical Center, the Level 1 trauma center where the EMS team was taking Joseph, is about 23 miles from Brockton, and depending on traffic it can take more than a half hour to get there.

Joseph was given more blood at the medical center, where he remained for nearly a week. He eventually underwent three surgeries to repair his hand and has now returned to his warehouse job.

Although Boston has several Level 1 trauma centers, the region south of the city is pretty much a trauma desert, said Crisanto Torres, one of the trauma surgeons who cared for Joseph.

Boston Medical Center partners with the Canton Fire Department to operate the field transfusion program. It's an important service, Torres said.

"You can't just put up a new Level 1 trauma center," he said. "This is one way to blunt the inequity in access to care. It buys patients time."

Michelle Andrews: andrews.khn@gmail.com, @mandrews110

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