Memorial Hermann Physician Network and Blue Cross Blue Shield of Texas are teaming up to develop an accountable care organization that will better manage the cost of care for 100,000 members.
The Lone Star state's largest insurer and Houston's largest health system are teaming up to develop a Texas-sized accountable care organization.
Big Tex
Blue Cross Blue Shield of Texas and Memorial Hermann Health System expect their ACO arrangement to be underway by July 2014.
The two are undertaking the effort to better manage the care for, and the cost of, the 100,000 Blues members seen by 2,000 physicians in the Memorial Hermann Physician Network, which is part of the 12-hospital Memorial Hermann Health System.
Robert Morrow, MD, medical director for BCBSTX, says the new ACO is the "logical progression" of the payment methodologies such as bundled payments and shared savings being applied throughout the healthcare industry as providers and payers make the paradigm shift from paying for procedures and volume to paying for value.
ACOs are about using data to drive and demonstrate improved patient outcomes, as well as a cost savings, Morrow says.
The Texas-sized ACO itself is a work in progress, so specific details are scarce. Both partners are experienced players in terms of adopting innovative approaches to reduce healthcare costs. Memorial Hermann already has in place an ACO relationship with Aetna and a patient-centered medical home with Humana. It also participates in the Medicare shared-savings program. All totaled the physician network has about 300,000 covered lives under these different arrangements.
Meanwhile BCBSTX has an accountable care organization with Texas Health Resources and four active PCMHs.
Still, each deal is different. So when payers and providers enter into these agreements they have to take a hard look at their roles, notes Chris Lloyd, MD, CEO of Memorial Hermann Physician Network. "How will we do care management or outreach to patients? How will we combine our strengths?"
BCBSTX and Memorial Hermann have already started the exchange of data and information. Work sessions are also being held around care management principles and patient outreach, among other topics.
Each partner brings significant strengths to the ACO with data a strong point for both. Lloyd says BCBSTX will provide claims data across the spectrum of care—inpatient, outpatient, post-acute, surgical, and primary care—that will "provide us with a lot of transparency in terms of how we are doing" in terms of outcomes and cost savings.
He says BCBSTX also has sophisticated total cost of care accounting processes that Memorial Hermann can cross check with its own data to make sure the insurer and health system are on the same page in terms of how patients should be managed.
Morrow notes that Memorial Hermann has a "long history in developing patient data, particularly in the clinical arena." It has the population and risk stratification tools in place to calculate co-morbidities to identify the individual patients most likely to need intervention through care management or coordination.
Measuring success of the ACO will probably include the usual suspects such as increased utilization of recommended preventive care and screenings, and reduced hospital readmissions. Improved management of chronic conditions such as COPD, congestive heart failure, and diabetes will also play a role.
Lloyd says the financial arrangement will be based on the total cost of care with underlying clinical and cost benchmarks. The ACO will include the commercial and Medicare Advantage lines of business.
The multi-year contract will run at least three years, which Lloyd says is the time it takes to begin to manage the cost trajectory. Typically the first year of an ACO costs the most because of the amount of diagnoses taking place. Cost reduction begins to appear in the second or third years of an ACO.
Lloyd says the ACO arrangement is a win-win for patients and employers. "Patients like it because it's more focused on managing their health and not just caring for them on an encounter basis like when they are admitted to the hospital."
Employers are becoming more aware of ACOs and their potential to help reduce the cost of employee healthcare benefits. "When they see an accountable care network as part of the benefit design they are selecting it," says Lloyd.
To help reduce the cost of care for their frailest members, payers are increasingly focusing on prevention and disease management. It is estimated that these patients drive 35% to 50% of total healthcare costs.
Cigna's recent acquisition of Alegis Care, which focuses on homebound healthcare for the very frail, is yet another sign that payers are becoming increasingly comfortable crossing into provider territory to play a proactive role in reducing the cost of healthcare for their members.
It also puts Cigna on the frontline of what one consultant calls the "chronic care management arms race" as payers look to save money in the treatment of their frailest members by increasing the focus on prevention and management.
"These are among the costliest patients to serve," said Shawn Morris, the president of development and innovation for Cigna-HealthSpring in a statement released by the company. It is estimated that these patients drive 35% to 50% of total healthcare costs.
Alegis Care physicians make house calls and deliver medical care to chronically ill and elderly Medicaid and Medicare patients who are unable to travel to their regular physician's office. Services include transitional care from hospital to home, targeted chronic care management, and comprehensive health assessment.
Cigna, as well as WellPoint and Humana, has made turnkey acquisitions to help reduce the cost of care for this population. When WellPoint made the deal for CareMore Health Group, it acquired 25 healthcare clinics where physicians and other healthcare professionals specialize in delivering care coordination and intensive treatment to the chronically ill. Humana acquired SeniorBridge, a national network of care managers who provide in-home healthcare management and services for seniors.
The move by these payers to vertically integrate home-based care delivery allows them to "gain reputational benefits from delivering these services and to avoid the double marginalization that occurs when these services are purchased from an outside firm," says Adam Powell, a healthcare economist and president of Payer+Provider Syndicate in Boston.
"As Cigna, Humana, and WellPoint have all made acquisitions in this space, offering convenient chronic care management services may soon become table stakes."
Morris says Cigna looked at several care models before deciding on the Alegis Care approach, which puts the primary care physician in the driver's seat in caring for this population with support from social workers, nurse practitioners, pharmacists, and other healthcare providers. Morris says it is the right model to improve healthcare quality as well as the patient experience.
"If we can improve those two, we think the cost comes down," says Morris.
It is also easier to scale than the CareMore model, which requires bricks and mortar facilities.
Morris said Cigna has plans to expand its geographic reach, and grow the risk assessment and chronic care components of Alegis Care, as well as its third party business.
Risk assessment is particularly important in the care of this frail population, especially among new Medicaid or Medicare members. Morris says performing a thorough exam within the first 120 days of membership is critical in terms of quantifying co-morbidities in order to develop a care plan for the member.
"We identify the resources we need to bring to bear, such as a social worker or behavioral health, and we coordinate with the member's PCP in the delivery of those services."
Morris says right now chronic care is Alegis Care's smallest business. "We think we have the membership to scale this and we know how to do it in a risk environment. "
Alegis Care will continue to provide TPA services to other insurers. Morris says Cigna expects to build a business model to enable Alegis Care to continue to work for third parties and "be very successful at it. We think this is a population where no one has scaled the delivery of chronic care services and management—not the coordination of care—the actual delivery of care to chronics."
Alegis Care is already in five of the markets where Cigna-HealthSpring has Medicaid and Medicare Advantage members. There are plans to expand across all of those markets.
Morris also expects to capitalize on potential synergies with Cigna-HealthSpring's LivingWell clinics, which contract with physicians who work out of their own offices to provide in-office care to seniors. If a LivingWell patient is suddenly homebound, then Alegis Care physicians could be engaged to provide bridge care until the patient could once again travel to the LivingWell clinic for care. "That is part of our strategy," says Morris.
After concerns about delays, the federal data services hub, an integral part of health insurance exchanges, is ready to be deployed, federal officials say. But members of the House Subcommittee on Cyber Security are skeptical.
The assertion by federal officials that the data services hub necessary to support health insurance exchanges has successfully completed security testing and is operationally ready was challenged at a House subcommittee meeting Wednesday.
Rep. Patrick Meehan (R-PA), who chairs the Subcommittee on Cyber Security, Infrastructure Protection, and Security Technologies for the House Homeland Security Committee, disparaged the administration's claims.
"Just last month we were told that [it] wouldn't be ready until the end of Sept. 30. Now lo and behold [security testing] was completed on Sept. 6 and it's ready to go?" He added incredulously, "this is an agency [Department of Health & Human Services] that for three months failed to meet a single deadline."
The data services hub will provide one connection to the federal data sources needed to verify consumer application information on the health insurance exchanges.
Meehan's opposition to the data hub is well documented. Citing the potential for the abuse and theft of personal information, in July he introduced HR 2837, which calls for a one year delay in the hub's launch.
Most of the committee member's questions were fielded by Kay Daly, the assistant inspector general for audit services in the Office of Inspector General at HHS.
Daly's office released just last month a report on the implementation of the data services hub [PDF] from a security perspective. It noted that a "security authorization decision by the authorizing official, the CMS Chief Information Officer, is expected on Sept. 30. CMS is working with very tight deadlines to ensure that security measures for the Hub are assessed, tested, and implemented by Oct. 1. If there are additional delays in completing the security assessment and testing, the CMS CIO may have limited information on the security risks and controls when granting the security authorization of the hub."
Daly said during her testimony that CMS had just reported that the security authorization was completed on Sept. 6. Daly's office had not yet been able to do a thorough assessment of the new information, she said.
Meehan confirmed with Daly the steps in the security authorization process, including beta testing to identify the program flaws, making repairs, and then retesting. "Two or three weeks ago they couldn't certify to us that they had begun the beta testing," Meehan said, "do you believe that they made up all that work in such a short time?"
Daly explained that her office would have to review the related work documents before she could make any assessment.
Several committee members asked about the availability of documentation that could inform Congress and the general public of the efficacy of the system and the results of testing.
Daly replied that her department focused on the security of the hub and not how well the hub functioned. "That was beyond our scope. We understood that GAO would could that aspect."
Several committee members, and one witness, took exception to the data hub testing process being performed by an independent contractor—although contracting for this type of work is not uncommon.
"Speaking for myself, I never relied on a contractor to give complete assurance" on the efficacy of a process," stated Michael J. Astrue, who served as Social Security Commissioner under the Bush and Obama administrations. He left the office in February 2013.
"The OIG is set up to make independent assessments. I am outraged that you would rely on a contractor [for] complete assurance."
Astrue added that transparency is important. "You need to know if this system is secure, whether it's violating privacy, and whether it's doing its job. You don't know that right know. If the OIG defines its job so those things aren't relevant areas then you need to [ask] GAO to fill the gap where OIG isn't fulfilling its responsibility."
Although no officials from CMS were called to testify, the agency did release a data services hub fact sheet on Wednesday ahead of the subcommittee hearing. It says, in part, "The hub and its associated systems have several layers of protection in place to mitigate information security risk. CMS has developed an extremely strong enterprise information security program to protect consumer information in a secure and efficient manner during open enrollment and beyond."
The system will use "a continuous monitoring model that will utilize sensors and active event monitoring to quickly identify and take action against irregular behavior and unauthorized system changes that could indicate a potential incident."
Meehan closed the subcommittee hearing without calling for any action, but expressed his concern that the hearing had raised more questions about the readiness of the data services hub.
Despite reports of progress on health insurance exchanges, some members of Congress continue to express concern that the exchanges may not be ready by the Oct. 1 deadline.
If you cling to the hope that Congressional hearings are honest, forthright efforts by our elected representatives to fact-find about complex topics, then a subcommittee hearing held Tuesday must have been an eye opener.
The House Energy & Commerce Committee's subcommittee on health met ostensibly to gather information about the progress that is being made as we countdown to the Oct. 1 rollout of health insurance exchanges.
There have been several government reports released in recent months that have raised concerns about whether the exchanges will be ready to process millions of health insurance applications. Earlier this summer the Government Accountability Office released two reports that raised concerns about HIX meeting the Oct. 1 deadline. While "much progress has been made… much remains to be accomplished within a relatively short amount of time," the reports warned.
So, it seems entirely within the domain of the health subcommittee to take a look at where things stand for this critical piece of the healthcare reform law.
The opening statements by Rep. Joe Pitts (R-PA), chair of the subcommittee, and Rep. Phil Gingrey (R-GA) set a somewhat hopeful stage. Both voiced legitimate concerns that the exchanges would be ready on Oct. 1. Rep. Gingrey noted the complexities involved in testing the system."How can taxpayers feel secure with [having] their personal information in the exchange when there has not been adequate security checks to determine the effectiveness?" he asked.
The seven-witness panel was almost perfect. It included the four technology contractors charged with getting HIX up and running. If the committee members really wanted to assess the progress and potential problems of HIX then these witnesses, who work each and every day on the front lines of HIX development, were the ones to call.
Representatives from CGI Federal Inc., Equifax Work Solutions, Serco Inc., and Quality Software Services Inc.–firms with decades of experience in government contracting between them—spoke about the systems in place and the testing underway. All of them assured the subcommittee that they were on schedule with their part of the massive HIX project.
Three other witnesses also delivered statements: Antoinette Kraus, executive director of the Pennsylvania Health Access Network; Brett Graham, a partner and managing director for Leavitt Partners; and Edward Lenz, senior counsel for the American Staffing Association.
Kraus talked about how her statewide coalition of 60 organizations representing one million clients is helping to implementing the PPACA. Graham outlined the challenges faced by states, and Lenz addressed how the Obama administration has responded to employer concerns.
Typically each hearing includes five minutes of "testimony" from each witness during which time the committee members—at least the ones who show up—listen politely. The rubber really hits the road when the committee members begin their witness questioning.
Actually, the questioning from both Republican and Democrats is more like posturing. But in this case the Republican committee members were particularly egregious in their efforts to continue to paint Obamacare as a train wreck.
The four contractors and their reports of success were quickly forgotten as Republicans honed in on Graham and Lenz, who testimonies included some negative statements.
Graham, for instance, stated that while "baseline functionalities will be up and running" the exchanges can expect "a rocky enrollment period as they work to overcome both known and unknown operational challenges."
That's not a huge surprise. Anyone who has survived even a small technology upgrade can attest that glitches and bumps in the road are par for the course.
Lenz stated that his group is working with the administration to iron out the definition of full-time. The PPACA standard of 30 hours is below what most employers consider full-time and is creating "a perverse economic incentive to reduce employee hours." Lenz noted that the administration is willing to work with his group on this issue.
I watched all two hours of the subcommittee hearing and came away with a good feeling about HIX. The vendors gave a thumbs up and even the concerns of Graham and Lenz seemed manageable.
So imagine my surprise when a press release from the E&C Committee arrived in my e-mail Tuesday with this headline: As Health Law's Open Enrollment Approaches, Missed Deadlines, Delays, andData Security Concerns Cause Headachesfor All Involved.
The press release includes this statement from Rep. Fred Upton (R-MI), the E&C Committee chair: "We are now three weeks from the exchanges opening for enrollment, and questions and uncertainties continue to overwhelm. "Issues related to readiness testing and functionality of the exchanges have yet to be addressed. Missed deadlines, delays and untimely guidance will affect critical components of the exchanges, including eligibility determinations, integration with existing state programs, and coordination among agencies." The release includes statements from only two witnesses—Graham and Lenz.
Is it too much to expect an honest assessment of the entire meeting? Good news was delivered, but once again the partisan focus is to make healthcare reform seem like a losing proposition.
Elsewhere in Washington on Tuesday, federal officials announced that the data hub has been security tested and will be operational by September 30. The data hub is a networked system for verifying consumers' Social Security numbers, immigration status and other information when they log on to health insurance exchanges had been delayed, and beset by security concerns.
Despite some lawmakers' concerns, technology contractors say health insurance exchanges will be up and running by October 1, as mandated by law.
Four vendors entrusted with getting the health insurance exchanges up and running told a House subcommittee on Tuesday that despite concerns heard in healthcare information technology circles and within the federal government, the exchanges will be ready to roll by Oct. 1.
The exchanges are the online marketplaces that will be used by individuals to select and purchase health insurance, as mandated by the Patient Protection and Affordable Care Act. The preparedness of this critical component of the healthcare law has been widely debated among stakeholders, pundits, and politicians.
Earlier this summer the Government Accountability Office released two reports that raised concerns about HIXmeeting the Oct. 1 deadline. While "much progress has been made…much remains to be accomplished within a relatively short amount of time," warned the reports.
Rep. Joe Pitts (R-PA), chair of the House Energy & Commerce Committee's subcommittee on health, which called the hearing, clicked through the exchange functions that must be completed for each insurance application, including checks with the IRS to verify income and the Department of Homeland Security to verify residency.
"I've just gone through 20 steps…I'm a little skeptical that this system will function as advertised," Pitts said.
Rep. Frank Pallone (D-NJ), ranking member of the subcommittee, cautioned that although "hiccups and unanticipated issues will occur along the way, we need to put them in perspective."
Representatives from CGI Federal Inc., Equifax Work Solutions, Serco Inc., and Quality Software Services Inc., firms with decades of experience in government contracting among them, addressed a wide range of committee concerns, including the readiness of the data services hub, IT applications, paper applications, income and employment verification, and project modifications.
The contractors also assured the subcommittee members that they are well-versed in protecting personal information and have safeguards in place to protect the privacy of personal data.
Data Services Hub
The data hub, a networked system for verifying consumers' Social Security numbers, immigration status and other information when they log on to health insurance exchanges had been delayed, and beset by security concerns. But federal officials announced Tuesday that the hub has been security tested and will be operational by September 30.
The hub will be owned and operated by the Centers for Medicare & Medicaid Services. It will be housed in a CMS secure cloud hosted at a data center.
Michael Finkel, executive vice president for program delivery at QSSI, which is charged with writing the software code for the federal government's data services hub, said QSSI, too, is meeting its delivery milestones on time.
Software coding is complete, performance and integration testing is underway, and the hub is connected to the system that will transfer data to and from health plans. It is also connected to the databases at the federal agencies tasked with verifying information.
Online applications
CGI Federal has a 29-month contract to design, develop and implement the HIX. Cheryl Campbell, a senior vice president at the firm, is "confident" that CGI's part of the job will be ready by Oct.1. She noted that all the key milestones have been achieved, including an operational readiness review this month.
Paper Applications
John Lau, the program director for Serco Inc. contract, said his company is "on schedule" to deliver all of the requirements of its CMS contract to process and verify paper applications. Serco was contracted in July 2013.
Income and Employment Verification
Equifax Workforce Solutions has a five-year contract to provide realtime income and employment verification services to the data services hub. Lynn Spellecy, corporate counsel, said the company has provided this type of service to government agencies for almost 20 years. The services will be similar to the eligibility reviews it provides in 30 states for the Medicaid and Children's Health Insurance programs.
Spellecy said the Equifax system is integrated with the data services hub and end-to-end testing has been performed with the hub and the state exchanges. Volume testing to simulate activity at peak periods has been successfully completed. Data flow tests are scheduled for next week.
Low administrative costs and the capability to compete with public health insurance exchanges are driving factors. So is the promise of access to big data, which can give payers a strategic edge.
Change keeps on coming to the health insurance industry.
Pittsburgh-based Highmark Health Services is in the process of expanding its defined contribution products to large group employers. The expansion follows a successful year-long pilot with small group employers (fewer than 100 employees) that attracted 60 companies and about 6,000 covered lives, says Bill Brown, manager of digital distribution for the giant Blue Cross Blue Shield affiliate.
In January, Highmark made the product line available to employers with more than 100 employees. Now it is marketing to large employer groups (more than 1,000 employees).
To date it has enrolled around 100 companies with about 9,200 covered lives.
In January 2014, Highmark will add its defined contribution product line to its Delaware and West Virginia markets. The products are offered though Highmark's proprietary health insurance exchange, MyBenefits.
For employers, defined contribution plans take the guesswork out of budgeting for healthcare costs from year-to-year. An employer puts a cap on how much to spend on employee healthcare benefits. Each employee receives a set amount of money to spend on the exchange to purchase the health benefits that meet his or her needs.
Among the advantages to Highmark is administrative efficiency. Brown notes that in western Pennsylvania a lot of Highmark's small group business was paper-based and took some time to manage. The platform in place for defined contribution is entirely electronic for processes such as open enrollment and enrollment updates.
"Once we input the group information onto the platform we can provide the group administrators with enrollment and payroll reduction reports. An administrator can download a member census whenever they need one. To not have to worry about pushing paperwork saves a lot of time and effort," says Brown.
Highmark began exploring the market for defined contribution just as healthcare reform came onto the scene. Brown, who was in new product development at the time, says the team looked at new and expansion products that would be healthcare reform compliant.
Business retention, especially in terms of competing with the public HIX, was a driving factor.
Offering defined contribution through its own private, proprietary HIX filled the bill.
Highmark decided to pilot with small groups so insurance brokers could be part of the process. About 99% of Highmark's small group business is sold through brokers and the insurer wanted to maintain that buffer with clients as it worked through the operations side of the HIX. The pilot began with one broker and then added five.
BCBS's Brown says the buzz about private HIX and defined contribution plans has exploded over the past six to eight months as employers have become more aggressive in seeking out new ways to reduce their employee healthcare costs. He says Highmark's decision to expand from 100-member employer groups to 1,000-member groups simply reflects market demand.
More than 14% of the groups selecting defined contribution products are new to Highmark. Buy ups of ancillary products such as dental and vision to existing customers nearly doubled. Previously those products were not always available to small groups, Brown says.
But it is access to so-called "big data" that makes the strategic difference. "We get tons of information from the employees who are shopping on the platform," says Brown. Highmark also gathers information from surveys about the product selection and the employer contribution.
Recently Highmark revamped the platform's user experience based on survey feedback from administrators and employees. One change: adding an employee sign-in before reviewing products. Employees preferred to sign-in so they could save their work as they moved around the platform and then come back to it later. Decision support tools to help in product selection were also added.
The Highmark platform was developed by Seattle-based Array Health. Last month Highmark announced that it is expanding its strategic relationship with Array and investing in the company to enable "more businesses in more locations" to access its defined contribution products.
An OIG review of recovery audit contractor files covering a two-year span identified improper payments in about 50% of them, totaling $1.3 billion. Unless CMS takes action to develop additional performance evaluation metrics, high amounts of improper payment will continue, OIG says.
The Centers for Medicare & Medicaid Services needs to tighten up the oversight of its recovery audit program to evaluate its effectiveness in terms of improper payments identified, the referral of potential fraud cases, and the implementation of corrective action, according to a report from the Office of Inspector General at the Department of Health and Human Services.
In addition, the OIG report notes that recovery audit contractor performance metrics and evaluations are sorely lacking. "Given the critical role of identifying improper payments, effective oversight of RAC performance is important."
While providers, particularly hospitals, have criticized what are sometimes construed as overzealous efforts by RACs, this OIG report suggests that with additional training, RACs could identify even more fraud.
The OIG studied recovery audit contractor files for FY 2010 and FY 2011. During those years, RACs reviewed 2.6 million claims and identified improper payments in about 50% of them totaling $1.3 billion.
More than half of those payments involved billing code errors and care delivered in settings that were too intensive or expensive. About $903 million in improper payments were recovered from or returned to providers.
CMS identified some 46 vulnerabilities—including suppliers and providers billing separately for bundled services—that led to improper payments. While specific corrective actions were taken to remedy the issues, CMS never evaluated the effectiveness of those actions. "As a result, high amounts of improper payments may continue," according to the report.
The report notes that the Government Accounting Office identified similar vulnerabilities in a 2010 report.
While RACs focus on identifying payment errors, they are also required to report evidence of potential fraud. For FY 2010 and FY 2011 the RACs reported only six cases nationwide on the basis of "external notification," which typically means complaints from provider employees who were asked to submit false claims. The report notes that in November 2012, CMS still had not taken any action on the cases.
To remedy these and other issues, the OIG made these recommendations:
Assess the vulnerabilities pending corrective action and develop timeframes for addressing them to make sure they are resolved in a timely manner.
Improve education to ensure that RACs refer all appropriate cases of potential fraud by providing specific examples of fraud that should be referred and regularly communicating with RACs to share information about fraudulent coding or billing schemes.
Take appropriate and timely action on RAC referrals of potential fraud.
Develop evaluation metrics to improve RAC performance and to ensure that RACs are evaluated on contract requirements. "Metrics should include accuracy targets for RAC determinations of improper payments or similar measures (e.g., effectiveness ratings)," says the report.
In a written response included in the OIG report, Marilyn Tavenner, the CMS administrator, concurred with items 1, 2, and 4. Regarding item 3, Tavenner provided an update on CMS action taken on six cases in question but did not make any future commitment.
Under the guise of better "understanding the work" health insurance exchange navigators will perform, a request from some GOP members of the House Energy & Commerce Committee carries the whiff of political motivation.
The House Energy & Commerce Committee is turning up the heat on one of its favorite targets—the Patient Protection and Affordable Care Act. With defunding healthcare reform now an unlikely outcome, E&C has turned its attention to the counselors expected to help the uninsured navigate their way through the health insurance exchanges expected to begin operating in less than one month.
Last week 15 Republican members of the committee signed letters to 51 of the 105 organizations recently named as navigators for the public HIX. The letters demand that the organizations provide extensive information about how their navigator grants will be used, the budget for the grants, employee training, employee supervision, and what safeguards will be in place to protect personal information.
That all sounds quite reasonable on the surface. But the request for information carries the whiff of political motivation.
Under the guise of "understanding the work" the navigators will perform, the letter also asks for "a written description of whether your organization may contact individuals who have utilized you services as a navigator for... fundraising, voter registration efforts, or campaign activities."
Huh?
Finally, the committee wants to see all the documentation related to the navigator grant application itself.
"This would include, but is not limited to, materials your organization submitted in order to obtain the grant, materials provided to your organization upon obtaining the grant, and communications between your organization and representatives from HHS, CMS, CCIIO or any other federal or state entity. This request also includes, but is not limited to, any documents provided by (or communications with), representatives from HHS, CMS, CCIIO, Enroll America, or any other entity including federal or state governments discussing individuals to target or solicit for enrollment under the PPACA including discussions or documents related to geographic area."
Enroll America? That is the 501(c)(3) organization behind the "Get America Covered" campaign, which is funneling tens of millions of dollars into an education and HIX enrollment effort directed at the uninsured. The group has ties to the White House and is unpopular, to say the least, in Republican circles.
The letter also includes a four-page description of how the information requested should be transmitted to the E&C committee, including numbering folders and boxes and providing a written certification that all the related documents have been shared with the committee.
The navigator responses are due to the committee by Sept. 13.
Rep. Harry Waxman (D-CA), the ranking minority member of the E&C could barely contain his frustration. In a letter to Rep. Fred Upton (R-MI), the E&C chair, Waxman labeled the navigator letter as "an abuse of your oversight authority" and "groundless investigations into civic organizations that are trying to make health reform a success."
He noted that the timing of the letters and the Sept. 13 deadline was "particularly suspect. You are insisting on voluminous document productions... just when these groups need to be focused on their mission of helping uninsured Americans enroll for coverage."
He added that the information requests appear to have been sent "solely to divert the resources of small, local community groups just as they are needed to help with the new healthcare law."
It is hard to say what the E&C Committee expects to accomplish in this move. Whether you support PPACA or not, you must be as tired of this political posturing as I am. The House has had ample opportunity through its hearing process to question leaders at the Department of Health and Human Services about the navigator process. But so many of these hearings are bogged down in partisan politics that they are more political theater than fact-finding efforts.
PPACA is the law of the land. Isn't it time for the House GOP to move on to more pressing issues?
A series of papers describing Medicare policy reform proposals is expected to be released over the coming months by the House Energy & Commerce and House Ways & Means committees.
A discussion paper released last week by two influential House committees outlines a Medicare reform strategy focused on deductibles, coinsurance and a cap on out-of-pocket spending. The proposals reflect many of the topics discussed during House committee meetings held in recent months.
Modernizing Medicare for the 21st Century is the first paper in a series of Medicare policy proposals expected to be released over the coming months by the House Energy & Commerce and House Ways & Means committees. The papers are intended to "spark discussion on how to protect seniors and place the Medicare program on sound financial footing."
Since 2008 the Medicare Trust Fund has paid out more in hospital benefits and other expenditures than it receives in income. Interest earnings and asset redemptions are used to cover the difference. In 2012 alone, $11 billion in interest income and $24 billion in asset reserves were used to cover the shortfall, according to the 2013 Medicare Trustees Report.
The latest estimates have Medicare Part A, the hospital trust fund facing insolvency in 2026.
While acknowledging that the onslaught of aging baby boomers, increased expenditures, and draining resources have all contributed to Medicare's ongoing problems, the discussion paper also points a finger at what it terms "the program's outdated 1960's-era old-fashioned and complicated benefit design" that fails to "encourage consumer involvement and often leaves beneficiaries confused."
According to the paper, it is time for Medicare to follow the lead of commercial insurers, which have long coordinated hospital and physician benefits. Medicare continues to relay on "an array of confusing coinsurance and deductible levels and a fee-for-service structure," that have discouraged provider care coordination, rewarded overutilization, and increased costs.
The paper makes these suggestions:
Uniform deductible. Set a combined annual deductible for Medicare Part A (hospital, skilled nursing, and home health services) and Medicare Part B (physician and outpatient services) to "better align beneficiary incentives."
Coinsurance. Put in place a simplified coinsurance rate that applies to spending above the uniform deductible to help make out-of-pocket costs more predictable for a beneficiary.
In addition, there is a call for reforms to protect Medicare beneficiaries from out-of-pocket costs that "exceed a defined and reasonable catastrophic limit."
The discussion paper also notes that any reform proposals must take into account how the purchase of supplemental coverage, including so-called Medigap policies and employer-sponsored retiree plans, may impact overall Medicare costs.
A 2009 MedPAC study found that overall Medicare spending was 33% higher when beneficiaries had Medigap insurance and 17% higher when they had employer-sponsored coverage.
No time line for additional discussion papers, committee hearings, or reform bills has been given.
Survey data released by a national business group of large employers shows that while they do not have active plans to make a shift, members view the exchanges as a cost-effective option for certain population groups.
Although many states have taken an adversarial stance when it comes to public health insurance exchanges, large employers see the marketplaces as a cost effective alternative for certain population groups, including COBRA participants, young retirees, and part-time employees.
That is according to a survey released Wednesday by the National Business Group on Health.
Employers are not saying that they plan to take active steps to shift these population groups to the exchanges—a common concern—rather, they view the exchanges as a "viable option on an individual basis," said NBHG president Helen Darling, in a telephone interview.
Some 41% of employers reported that COBRA plan participants will find the public health exchanges to be the most cost-effective option for them while 26% said some of their pre-65 retirees will opt to join the exchanges. In addition, 20% of employers responded that some of their part-time employees could move to the public exchanges.
The findings are part of an annual employer survey released by NBGH, an association whose members include more than 365 large, national employers, including American Express, CBS Corp., and Time Warner. More than 100 employers, most with more than 10,000 employees, responded to the survey.
Employers are also looking at private health insurance exchanges. Some 30% responded that they are considering private exchanges as an option for their active employees sometime after 2014. Private HIX can be used by employers to transition to a defined contribution strategy where the employer puts a cap on how much to spend on employee healthcare benefits.
Private Exchanges
Private exchanges are being developed by consulting firms, such as Aon Hewitt, Mercer, and Towers Watson, as well as retailers, such Walgreens, and insurance brokers. Aetna and Cigna have announced plans to develop proprietary exchanges.
Darling says employers are tentatively embracing the new payment models introduced through healthcare reform, including accountable care organizations and patient-centered medical homes. Noting that health plans play important roles in both ACOs and PCMHs, she said self-insured employers will have to figure out how to participate in these opportunities.
Employers identified wellness initiatives (58%), consumer-directed health plans (52%), and increased employee cost sharing (41%) as their three most effective tactics for controlling costs.
Employer interest in CDHPs has remained steady in recent years with almost three-quarters of employers (72%) offer at least one CDHP. However, some employers are moving exclusively to CHDPs. Some 22% plan to offer only a CDHP in 2014. That is up from 19% in 2013.
While employers do not expect to make big changes in the proportional sharing of healthcare premiums, employees will see cost increases under certain circumstances, including surcharges for spouses, dependents, and tobacco use.
A Shift in Family Coverage
Darling said that there is evidence that some employers are moving toward changing how they address family coverage with 9% of respondents reporting that they will base employee premium contributions on the number of dependent enrolled in 2014.
Last week United Parcel Service announced that it will drop coverage for working spouses.
Among the other report findings:
The healthcare cost trend remains at 7% for the third consecutive year.
Few employers—only 7% plan to increase their outcome-based wellness incentives to more than 20% of total plan costs.
Only 3% of respondents expect to eliminate healthcare coverage altogether.
More than four in 10 respondents (44%) currently have an on-site medical clinic in at least one location; 9% expect to build a clinic next year.
The wellness programs most frequently offered are tobacco cessation (89%), health assessments (88%), and biometric screenings (83%).