Under the farm bill, the secretary of Agriculture could grant up to 10 loans of no more than $15 million each, starting next year, for association health plans.

This article first appeared May 08, 2018 on Kaiser Health News.

By Julie Appleby

Some Republican lawmakers continue to try to work around the federal health law’s requirements. That strategy can crop up in surprising places. Like the farm bill.

Tucked deep in the House version of the massive bill — amid crop subsidies and food assistance programs — is a provision that supporters say could help provide farmers with cheaper, but likely less comprehensive, health insurance than plans offered through the Affordable Care Act.

It calls for $65 million in loans and grants administered by the Department of Agriculture to help organizations establish agricultural-related “association” type health plans.

But the idea is not without skeptics.

“I don’t know that anyone at the Department of Agriculture, with all due respect, knows a darn thing about starting and maintaining a successful insurance company,” said Sabrina Corlette, a professor and project director at the Georgetown University Health Policy Institute.

Association health plans are offered through organizations whose members usually share a professional, employment, trade or other relationship, although the Trump administration is soon to finalize new rules widely expected to broaden eligibility while loosening the rules on benefits these plans must include.

Under that proposal, association plans would not have to offer coverage across 10 broad “essential” categories of care, including hospitalization, prescription drugs and emergency care. They could also spend less premium revenue on medical care.

Under the farm bill, the secretary of Agriculture could grant up to 10 loans of no more than $15 million each, starting next year, to existing associations whose members are ranchers, farmers or other agribusinesses.

The language is strikingly similar to a bill introduced April 12 by Rep. Jeff Fortenberry (R-Neb.), a supporter of association health plans. He did not respond to calls for comment.

Although the farm bill is usually considered “must-pass” by many lawmakers, it is currently facing pushback because of controversy surrounding other parts of the measure, mainly language that would add additional work requirements to the food stamp program.

Still, the focus on association health plans won’t go away.

The plans — coupled with another Trump administration move to make short-term insurance more widely available — could draw healthier people out of the ACA markets, leaving the pool of beneficiaries with higher percentages of people who need medical care. And that, some say, could drive up premiums for those who remain.

The National Association of Insurance Commissioners, for example, has warned that association plans “threaten the stability of the small group market” and “provide inadequate benefits and insufficient protection to consumers.”

Actuaries have made similar arguments.

Others are concerned about the idea of the government providing funding for such plans.

“We have reams of experience with AHPs that have gone belly up … and the notion that we should put taxpayer money into them is irresponsible,” said Georgetown University’s Corlette.

She was referring to the industry’s mixed track record with plans. Some have served members well, but other plans have been marked by solvency problems that left consumers on the hook with unpaid medical bills or were investigated for providing little or no coverage for such things as chemotherapy or doctor office visits.

It’s not fair to simply focus on the failures, countered attorney Christopher Condeluci, who served as tax and benefits counsel to the Senate Finance Committee and now advises private clients, some of whom are interested in association plans.

“Some AHPs were not successful,” he agreed. “But there’s arguably more examples of AHPs that work. The trouble is everyone focuses on the negative.”

Although the GOP generally supports association plans, using taxpayer funds to help start them could prove problematic for some conservatives in Congress.

Many Republican lawmakers expressed concerns about the use of tens of millions of taxpayer dollars to start insurance co-ops that were part of the ACA, most of which failed.

“The hard-earned tax dollars collected from working Americans, sitting at Treasury right now, are not venture capital, said Rep. Kevin Brady (R-Texas) at a subcommittee hearing in November 2015. Currently, Brady is chairman of the powerful House Ways and Means Committee.

The provision could also be popular in rural areas.

“We think it’s a good idea,” said Rob Robertson, chief administrator for the Nebraska Farm Bureau Federation, whose group is considering sponsoring one.

About half of his members, Robertson said, have a spouse working a non-farm job, mainly for insurance coverage. Of those who buy their own plan, some are facing astronomical premiums and are looking for relief.

“I can’t think of any sector that is affected more by the huge premium increases under Obamacare than farmers and ranchers,” he said.

The farm bill — including the AHP provision — was approved by the House Committee on Agriculture in mid-April, and is currently awaiting floor consideration. Meanwhile, a final rule on the Trump AHP rule, which has drawn more than 900 comments from supporters and opponents, could be issued as early as this summer.

Now that employers, insurers, and government seem determined to curb growth in health care spending, the bets health systems placed on expensive medical technologies are less of a sure thing.

This article first appeared May 02, 2018 on Kaiser Health News.

By Jay Hancock

The Maryland Proton Treatment Center chose “Survivor” as the theme for its grand opening in 2016, invoking the reality-TV show’s tropical sets with its own Tiki torches, palm trees and thatched booths piled with pineapples and bananas.

It was the perfect motif for a facility dedicated to fighting cancer. Jeff Probst, host of CBS’ “Survivor,” greeted guests via video from a Fiji beach.

But behind the scenes, the $200 million center’s own survival was less than certain. Insurers were hesitating to cover procedures at the Baltimore facility, affiliated with the University of Maryland Medical Center. The private investors who developed the machine had badly overestimated the number of patients it could attract. Bankers would soon be owed repayment of a $170 million loan.

Only two years after it opened, the center is enduring a painful restructuring with investors poised for huge losses. It has never made money, although it has ample cash to finance operations, said Jason Pappas, its acting CEO since November. Last year it lost more than $1 million, he said.

Volume projections were “north” of the current rate of about 85 patients per day, Pappas said. How far north? “Upper Canada,” he said.

For years, health systems rushed enthusiastically into expensive medical technologies such as proton beam centers, robotic surgery devices and laser scalpels — potential cash cows in the one economic sector that was reliably growing. Developers got easy financing to purchase the latest multimillion-dollar machine, confident of generous reimbursement.

There are now 27 proton beam units in the U.S., up from about half a dozen a decade ago. More than 20 more are either under construction or in development.

But now that employers, insurers and government seem determined to curb growth in health care spending and to combat overcharges and wasteful procedures, such bets are less of a sure thing.

The problem is that the rollicking business of new medical machines often ignored or outpaced the science: Little research has shown that proton beam therapy reduces side effects or improves survival for common cancers compared with much cheaper, traditional treatment.

If the dot-com bubble and the housing bubble marked previous decades, something of a medical-equipment bubble may be showing itself now. And proton beam machines could become the first casualty.

“The biggest problem these guys have is extra capacity. They don’t have enough patients to fill the rooms” at many proton centers, said Dr. Peter Johnstone, who was CEO of a proton facility at Indiana University before it closed in 2014 and has published research on the industry. At that operation, he said, “we began to see that simply having a proton center didn’t mean people would come.”

Sometimes occupying as much space as a Walmart store and costing enough money to build a dozen elementary schools, the facilities zap cancer with beams of subatomic proton particles instead of conventional radiation. The treatment, which can cost $48,000 or more, affects surrounding tissue less than traditional radiation does because its beams stop at a tumor rather than passing through. But evidence is sparse that this matters.

And so, except in cases of childhood cancer or tumors near sensitive organs such as eyes, commercial insurers have largely balked at paying for proton therapy.

“Something that gets you the same clinical outcomes at a higher price is called inefficient,” said Dr. Ezekiel Emanuel, a health policy professor at the University of Pennsylvania and a longtime critic of the proton-center boom. “If investors have tried to make money off the inefficiency, I don’t think we should be upset that they’re losing money on it.”

Investors backing a surge of new facilities starting in 2009 counted on insurers approving proton therapy not just for children, but also for common adult tumors, especially prostate cancer. In many cases, nonprofit health systems such as Maryland’s partnered with for-profit investors seeking high returns.

Companies marketed proton machines under the assumption that advertising, doctors and insurers would ensure steady business involving patients with a wide variety of cancers. But the dollars haven’t flowed in as expected.

Indiana University’s center became the first proton-therapy facility to close following the investment boom, in 2014. An abandoned proton project in Dallas is in bankruptcy court.

California Protons, formerly associated with Scripps Health in San Diego, landed in bankruptcy last year.

A number of others, including Maryland’s, have missed financial targets or are hemorrhaging money, according to industry analysts, financial documents and interviews with executives.

• The Hampton University Proton Therapy Institute in Virginia has lost money for at least five years in a row, recording an operating loss of $3 million in its most recent fiscal year, financial statements show.
• The Provision CARES Proton Therapy Center in Knoxville, Tenn., lost $1.7 million last year on revenue of $23 million — $5 million below its revenue target. The center is meeting its debt obligations, said Tom Welch, its president.
• Centers operated by privately held ProCure in Somerset, N.J., and Oklahoma City have defaulted on debt, according to Loop Capital, an investment bank working on deals for new proton facilities.
• A facility associated with the Seattle Cancer Care Alliance, a consortium of hospitals, lost $19 million in fiscal 2015 before restructuring its debt, documents show. Patient volume is growing but executives “continue to be disappointed in the slower-than-expected acceptance of proton therapy treatment” by insurers, said Annika Andrews, CEO of SCCA Proton Therapy.
• A center near Chicago lost tens of millions of dollars before restructuring its finances in a 2013 sale to hospitals now affiliated with Northwestern Medicine, documents filed with state regulators show. The facility is “meeting our budget expectations,” said a Northwestern spokesman.

Representatives from ProCure and the facilities in San Diego and Hampton did not respond to repeated requests for interviews.

“In any industry that’s really an emerging industry, you often have people who enter the business with over-exuberant expectations,” said Scott Warwick, executive director of the National Association for Proton Therapy. “I think maybe that’s what went on with some of the centers. They thought the technology would grow faster than it has.”

In the absence of evidence showing protons produce better outcomes for prostate, lung or breast cancer, “commercial insurers are just not reimbursing” for these more common tumors, said Brandon Henry, a medical device analyst for RBC Capital Markets.

The most expensive type of traditional, cancer-fighting radiation — intensity modulated radiation therapy — costs around $20,000 per treatment, while others cost far less. The government’s Medicare program for seniors covers proton treatment more often than private insurers but is insufficient by itself to recoup the massive investment, analysts said.

The rebellion by private insurers “is very, very good” and may signal the health system “is finally figuring out how to say no to low-value procedures,” said Amitabh Chandra, a Harvard health policy professor who has called proton facilities unaffordable “Death Stars.”

Proton centers are fighting back, enlisting patients, legislators and nonprofits to push for reimbursement. Oklahoma has passed and Virginia has considered legislation to effectively require insurers to cover proton therapy in more cases.

An entire day at the 2017 National Proton Conference in Orlando was dedicated to tips on getting paid, including a session titled “Strategies for Engaging Health Insurance on Proton Therapy Coverage.”

Proton facilities tell patients the therapy is appropriate for many kinds of cancer, never mentioning the cost and guiding them through complicated appeals to reverse coverage denials. The Alliance for Proton Therapy Access, an industry group, has online software for generating letters to the editor demanding coverage.

In hopes of navigating a difficult market, many new centers are smaller — with one or two treatment rooms — and not as expensive as the previous generation of units, which typically have four or five rooms, like the Baltimore facility, and cost $200 million or more.

Location is also critical. Treatment requires near-daily visits for more than a month, which may explain why larger centers such as Maryland’s never attracted the out-of-town business they needed.

To make the finances work, hospitals are combining forces. The first proton beam center in New York City is under construction, a joint project of Memorial Sloan Kettering, Mount Sinai and Montefiore Health System.

Smaller facilities, which can cost less than $50 million, should be able to keep their rooms full in many major metro areas, said Prakash Ramani, a senior vice president at Loop Capital, which is helping develop such projects in Alabama, Florida and elsewhere.

Maryland’s center hopes to break even by year’s end, executives said. That will involve refinancing, converting to nonprofit, inflicting losses on investors and issuing municipal bonds.

But plans call for four centers soon to be open in the D.C. area.

“It’s a real arms race,” said Johnstone, the former proton-center CEO, who has co-authored papers on proton-therapy economics. He is now vice chair of radiation oncology at Moffitt Cancer Center in Tampa, which doesn’t have a proton center. “What places need now are patients — a huge supply of patients.”

The former HHS secretary, who resigned amid scandal last fall, criticized the elimination of the ACA's penalty for those who don't have insurance.

This article first appeared May 01, 2018 on Kaiser Health News.

By Emmarie Huetteman

In a surprising reversal, Dr. Tom Price said he now thinks getting rid of the individual mandate was a bad idea.

Yet this is the same Tom Price who only last summer laid the groundwork for the mandate’s eventual dismantling, saying it was “driving up the costs for the American people.”

In some of his first public remarks since resigning as secretary of Health and Human Services amid a scandal about his travel expenses last September, Price criticized the elimination of the Affordable Care Act’s penalty for those who don’t have insurance.

“There are many, and I’m one of them, who believes that that actually will harm the pool in the exchange market,” he said Tuesday, as one of several dozen keynote speakers at the annual World Health Care Congress in Washington. “Because you’ll likely have individuals that are younger and healthier not participating in that market, and consequently that drives up the costs for other folks within that market.”

At the conference, Price re-introduced himself — a third-generation physician who did “a short stint at HHS” — to insurers, drugmakers and other health industry types.

Washington could be forgiven for thinking they had met before.

As a congressman and then HHS secretary, he’d been a vocal critic of the ACA, lambasting its many elements — including the individual mandate — and pressing for the law’s full repeal. Months after Price’s resignation, that penalty was removed by Congress as part of a tax bill even as the ACA itself remained, having withstood multiple Republican attempts to kill it.

It has been seven months since Price stepped down amid reports he misspent hundreds of thousands of dollars of taxpayer money on private charter and military air travel. Price sidestepped questions Tuesday about the Trump administration and his change of heart on the individual mandate.

But Price’s re-emergence offered a snapshot of a tarnished former Trump administration official working on his next act. In January, he joined the board of the Atlanta-based Jackson Healthcare, a health care staffing and technology company.

A conference spokeswoman did not respond to inquiries about the decision to invite Price and whether he was paid to give remarks. The conference organizers played down Price’s remarks, billed as “a candid perspective” on the prospects for efforts to repeal and replace the Affordable Care Act and timed early on the third day of the four-day conference. He was conspicuously absent from the headshots of featured speakers splashed across the conference website and cagey about his plans for the future, referring only to his “advisory roles” when asked.

Gone was the Tom Price who, as a leading critic of the ACA while a Republican congressman from Georgia, attracted the attention of President Donald Trump. But it was the administration’s fight against the ACA that, by many accounts, cost him Trump’s support.

Price “better get the votes,” Trump said in a speech last July, days before the Senate rejected one of the last in a round of attempts to repeal President Barack Obama’s signature health care law. “Otherwise I will say, ‘Tom, you’re fired’.”

“From a policy standpoint, the repeal-and-replace battle last year was kind of the height of political frustration, wasn’t it?” Price mused to the audience Tuesday.

Instead of hammering the ACA, Price offered a brisk, occasionally perfunctory assessment of the health care landscape, ticking off a list of challenges (regulation, bad; wearables such as Fitbits, good) and developments (the health care market, stable; association health plans, under review). The states are doing their own assessments and reacting to it — and rightfully so, he said, pointing to decisions by Republican-led states such as Utah to expand Medicaid. (He had opposed the expansion of Medicaid as a congressman.)

On this, Price could offer an expert up-close opinion: “These are states that have looked at the situation, don’t necessarily see a solution coming out of Washington.”

Until there's a central information source, consumers will have to use their research skills, plus a little telephone work.

This article first appeared April 30, 2018 on Kaiser Health News.

By Emily Bazar

Back in 2008, Mary Hogden was homeless, living on the streets of Berkeley, Calif.

“I got beat up really badly out there,” says Hogden, 62. “It’s not a safe place for women.”

She landed in the hospital and then in a boarding home for adults with mental illness. But her big break came when she started volunteering for a mental health program called the Pool of Consumer Champions, run by Alameda County.

Participants, who offer each other support, also advise the county’s behavioral health division on how to better meet consumers’ needs. The county has adopted some of the group’s recommendations, Hogden says.

“People rallied around me when I was unstable and struggling with my mental health,” Hogden recalls.

She didn’t know at the time that the program was paid for by the state’s Mental Health Services Act (MHSA). But after two years as a volunteer, she became a paid staffer and learned that the program wouldn’t exist without that funding.

“I wouldn’t be where I’m at in my wellness and recovery had it not been for the Mental Health Services Act,” Hogden says.

In 2004, Californians approved the act, originally known as Proposition 63, which imposes a 1 percent tax on personal income over $1 million to help counties expand mental health care services.

The tax has raised billions, and Gov. Jerry Brown expects it will bring in roughly $1.8 billion in the coming fiscal year.

“Counties were able to take Mental Health Services Act dollars and either revamp existing programs or completely create new programs that didn’t exist at all,” says James Wagner, deputy director of Alameda County Behavioral Health Care Services.

The act has been “wildly successful” at improving the ability of counties to respond to the mental health needs of their residents, he says.

But counties and the state have faced criticism from the Little Hoover Commission, an independent state oversight agency, and others for their implementation of the law. In February, a state audit accused counties of hoarding the mental health money — and the state of failing to ensure the money was being spent.

Still, there’s no question “these programs have helped hundreds of thousands of people,” says Heidi Strunk, president of the California Coalition for Mental Health.

A 2016 compilation of MHSA-funded programs across the state lists page after page of offerings that address homelessness, suicide, caregivers, veterans, children and dozens of other topics and populations, including scholarships for college students pursuing degrees in mental health.

But what’s available — and to whom — depends on your county. For instance, most programs are for low-income residents, but that’s not true across the board. Unfortunately for consumers, researching county programs and determining whether you or your loved ones qualify may not be easy.

“It’s so hard for individuals and families to know what kind of services are available, especially because there’s no statewide standard,” says Jessica Cruz, CEO of NAMI California, an advocacy group for individuals, and their families, who have been affected by serious mental illness.

“Access is an issue,” Cruz says. “There’s not one singular place to look and see what’s available.”

Strunk’s coalition is advocating for a statewide, interactive map that will allow you to click on your county and see its Mental Health Services Act programs. NAMI California, which compiled the 2016 list of programs statewide, is working on an update, but that won’t be out until this summer, Cruz says. (Check NAMI California’s website at namica.org for the update.)

“We’re still trying to resolve issues with how to get information to the public,” Strunk says.

Until there’s a central information source, you will have to use your research skills, plus a little telephone work.

To get started, Strunk suggests Googling your county’s name and the term “MHSA coordinator.” Then call that person. You can also find your county’s MHSA plan online.

Some counties have toll-free hotlines that will help connect you with appropriate programs based on your needs. (In Orange County, for example, it’s 855-625-4657. In Alameda County, dial 800-491-9099. Riverside County residents can call 800-706-7500.)

“Each county webpage looks different,” Strunk warns. “Some counties have super user-friendly landing pages, for some counties it’s buried, and some you can’t find at all.”

MHSA programs primarily serve recipients of Medi-Cal, California’s version of the federal Medicaid program for low-income residents, and uninsured people with serious mental illnesses. But there are also services for a broader range of the population.

About 20 percent of Mental Health Services Act dollars are earmarked for “prevention and early intervention,” and these are more likely to serve a wider cross section of people.

Sharon Ishikawa, Orange County’s Mental Health Services Act coordinator, points to OC ACCEPT as one example. The program provides counseling, vocational support and other services to people — and their families — who are confronting challenges related to sexual orientation and gender identity.

“It is open to anybody with or without insurance,” says Dawn Smith, a program manager who oversees several of the county’s MHSA-funded services. “They might have a really high deductible and don’t have a way to pay that or they might not be able to afford the copay.”

But the majority of participants are uninsured, Smith says.

NAMI, which has chapters across the state, operates some MHSA-funded programs on behalf of counties, and eligibility is not based on insurance status, Cruz says.

“For us, anybody’s eligible. Anybody can come to a family-to-family class. Anybody can come to a support group. You don’t have to be referred by the county,” she explains.

NAMI Orange County runs the MHSA-funded Peer Connector program, says Diana Fernandez, one of the peer mentors.

The program is for people, regardless of income, who have a family member or friend who is struggling with mental illness, a learning disorder or a behavioral problem. Participants can have a one-hour phone call each week for up to 12 weeks with peer mentors who have had personal experience finding help for themselves or loved ones, Fernandez explains.

Fernandez has five children, and two have struggled with dyslexia and attention deficit hyperactivity disorder (ADHD).

Last week, Fernandez spoke with a man who told her he felt suicidal. She stayed on the phone and connected him with the county’s crisis assessment team, then waited until she knew he was on his way to the hospital.

That situation was unusual, she says. More typically, Fernandez helps parents of children who are struggling in school, or caregivers who are emotionally and physically spent.

“We assure clients that they are normal and typical for what they’re going through,” she says. “That gives them a feeling of hope they may not have had before.”