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Tag Archives: Insurance

Massachusetts' Next Step

According to this article in the NY Times, Massachusetts is getting crushed by health care costs. A vast majority of people in the state have some form of insurance, but the costs of providing health care in Massachusetts is expected to increase by 42% in 2009 alone. Now Massachusetts is looking at whether it can regulate insurance premiums – i.e. limit what insurers can charge. Massachusetts is also deciding whether or not to “bundle” payments for health care. In other words, if you need your appendix out, Massachusetts pays the provider one price to take care of you from beginning to end of treatment for that problem. If you get it done cheaper, the provider keeps the change. If there are complications or if expensive testing is needed, the provider pays out of pocket for whatever costs go above and beyond the flat fee. In theory, providers could lose significant amounts of money by treating high-risk patients who are prone to develop complications or bad outcomes. This prepayment idea was also tossed about by Michael Canon at the CATO Institute. On its face, the idea sounds good. But underneath the surface, I think that such a system encourages skimpy medical care and encourages cherry-picking of healthy patients. Remember the HMOs that paid physicians a flat fee for taking care of all the patients? Remember fighting with physicians for appointments and testing because the physicians had to control costs? How will the system proposed in Massachusetts be any different? In addition, I think there will be a lot of gaming of the system. I was going to give examples of how the system could be gamed, but will hold off for now until more about the proposal is disclosed. I continue to think that “prepayment” or “bundled payment” ideas will have an adverse effect on medical care. Healthcare policy experts interviewed for the article hit the nail on the head: Changes in payment practices will not be enough to slow the growth in spending, even when combined with other cost-cutting strategies. To truly change course, they say, the state and federal governments may need to place actual limits on health spending, which could lead to rationing of care. “Really controlling costs requires just stopping spending,” said Stuart H. Altman, a professor of health policy at Brandeis University.

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Emergency Care – Where's The Line?

The University of Chicago case is getting a lot of press and is polarizing the people on either side of the argument about Dontae Adams’ care. Read about it at one of my previous posts, at ShadowFax’s place, over at Kevin’s blog, or at Scalpel’s blog. The Chicago Tribune is getting a lot of play out of the controversy. It has published several articles already and just put up another one last night. Just by the sheer number of people writing about the topic, you should be able to tell that the outcome of this topic is going to help define how medical care will be provided in the future. On one side of this issue is Dontae Adams and his mother. Dontae happened to be in the wrong place at the wrong time. He was bitten in the mouth by a pit bull and had a large cut on his lip. It is obvious that he needed medical care. Dontae’s mother took him to the emergency department at the University of Chicago where she alleges that they began asking her about their insurance soon after they arrived. Dontae’s mom works and he has medical coverage through the Illinois Medicare program. Stop here for a minute. If you read through the comment boards at the Chicago Tribune web site, they are rife with people who criticize indigent/uninsured patients who may or may not be citizens of this country for “clogging up the emergency department” by going there for “routine” care. It’s easy to look down on someone is viewed as “abusing the system.” So let me ask you this: Suppose you lost your job tomorrow and had no insurance. Suppose you had to take a minimum wage job at WalMart to keep food on the table for your kids and you weren’t eligible for health insurance. What would you do for medical care? If you called a random doctor’s office and told them you needed an appointment for “routine” care and could only pay a small amount of cash, what are the chances that you’d get seen that same day? What are the chances that you’d be seen at all? Our family has good insurance, my daughter needs to see a specialist, and the earliest appointment is 4 months away. Let’s say you’re living on a fixed income and want to pay for your doctor’s visits in cash. How can you afford to spend well over a hundred dollars for a single doctor’s office visit? Ah, but there are free clinics all over the place, right? In the rural hospital where I moonlight, the closest free clinic is about 40 miles away and has very strict criteria on who it will treat at no cost. Cook County, IL, where the University of Chicago is located, is in the midst of a budget crunch and has closed down many free clinics. See articles HERE, HERE, and HERE. There’s also an issue of whether or not the care some people seek in the emergency department is “necessary.” Clearly, much of the care that emergency physicians provide is not “emergent.” But I can say that because I have had eight years of medical training plus all the continuing medical education each year. Going to the emergency department to get an excuse for missing work, or trying to get a three day government-paid babysitter for grandma so you can leave on a trip is one thing, but in general, we have to give the benefit of the doubt to the patients. Back to Dontae. According to federal EMTALA laws, patients must receive a medical ...

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The Healthcare Ponzi scheme

Today I was going to finish a post I created about how emergency care in the US is now at a “tipping point.” Before doing so, I scanned some of my favorite blogs. A post by Dr. Wes is so insightful and so timely that I had to incorporate it into what I was writing about. Dr. Wes coins a new term called the “Bernie Syndrome”, named after Bernie Madoff and his giant Ponzi scheme that took down so many wealthy investors. People got caught up in his scam because no one took the time to look at how Bernie achieved his remarkable results. No one cared. Bernie’s clients just got regular portfolio statements showing how great their investments were going. Meanwhile, behind the scenes, everything was crumbling. Even though Madoff’s business model was collapsing, everyone was still happy because of the rosy statements that Madoff was sending them … that is until the market got so bad that he couldn’t maintain his charade. Suddenly there was nationwide panic as people learned that the real picture was nothing like the picture that Bernie Madoff had painted. Dr. Wes gives a couple of examples about the “Bernie Syndrome” and healthcare, including the recent SCHIP expansion and lowering Medicare eligibility to age 55 instead of age 65. US citizens suffering from Bernie Syndrome think that the added coverage is great. After all, just like Bernie Madoff’s investors, the public is going to get even more health care – for free – regardless of what the market or the deficit is like. SCHIP expansion will cover more kids. Medicare expansion will cover more seniors. Underneath these wonderful proposals, however, the medical care system in this country is being crushed under its own weight. Before the Madoff collapse, several industry insiders questioned the returns Bernie Madoff achieved with his investment portfolios. No one seemed to listen – they were too caught up in the grand illusion that Madoff had created. Now, at least in emergency healthcare, the Ponzi scheme, reinforced by the Bernie Syndrome, is starting to unravel. George Bush embodied the Madoff Mentality when he told business leaders during a 2007 speech in Cleveland “The immediate goal is to make sure there are more people on private insurance plans. I mean, people have access to health care in America. After all, you just go to an emergency room.” The transcript of Mr. Bush’s speech used to be here, but for some reason the White House has now removed the text of that speech from its archives. So patients with Bernie Syndrome now go to the “emergency rooms”. The widely held belief is that if you go to the emergency department, federal law requires the emergency departments to treat you. That widely held belief is only partially true. EMTALA laws require that every patient be screened for an emergency condition. If no emergency condition is found, the hospital has no duty under EMTALA laws to provide any further care. If an emergency medical condition is found, the hospital is required to stabilize the condition, or, if the hospital cannot provide stabilizing treatment, then the hospital must provide an “appropriate transfer” to another facility that can provide such treatment. The Ponzi scheme in emergency medical care was working well for a while. Then shrinking reimbursements closed some hospitals. Now unfunded emergency care is taking too much of a bite out of hospital budgets. You see, EMTALA may require that hospitals provide all patients with a screening exam and treatment for an emergency condition, but EMTALA makes no provision on how providers will receive reimbursement for ...

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Another Gash In The California Safety Net

An article in yesterday’s California Daily Journal (subscription only) by Evan George titled “ER Patients Use Court Ruling to Push for Billing Refunds” shows why Californians are going to soon have a lot more difficulty obtaining emergency care. A man named Ariel Sabban is suing Scripps Memorial Hospital and its emergency physician group for $57.83 as a refund for a medical bill he paid more than a year ago after bringing his kid to the hospital and having the emergency physician sew up his kid’s head. In essence, since balance billing is now “illegal” in California, Sabban is stating that the hospital and emergency physicians shouldn’t have billed him for what his insurance didn’t cover. He is being represented by Vincent Slavens, a partner at Krause Kalfayan Benink and Slavens in San Diego. The Daily Journal expects that if a wave of class action suits over the case occurs, “hospitals and ER doctors could be on the hook for hundreds of millions of dollars in collective refunds to patients.” I “Googled” the terms “Ariel Sabban” and “San Diego” and the first thing that popped up was this link to the California Bar Association. Is Ariel Sabban’s full name “Ariel Joseph Sabban” and is he a San Diego attorney with the firm Murray, Hayes & Sabban? If Krause Kalfayan Benink and Slavens is able to obtain class action status in their law suit, they have the potential to get a large settlement on behalf of the “class” who will each likely end up with a pittance in “reimbursement”. You have to know that a class action is what the firm is shooting for – why else would they file a lawsuit over $57? If Ariel Sabban is an attorney, he just might have a “referral fee” arrangement with the law firm representing him, which could mean that a class action settlement becomes a windfall for him — all over his $57 “overpayment.” Whomever Ariel Sabban is, he can revel in the fact that his frivolous lawsuit will likely be the straw that breaks the back of the California emergency medical system. Everyone in California should realize just how bad their emergency medical care is about to get. I already posted about the difficulties with emergency medical care in California HERE and HERE. According to the Daily Journal article, 70 hospital emergency departments in California have closed in the past 13 years. It’s not going to get better. When your dad is dripping with sweat, can’t breathe and is clutching his chest with a heart attack and seconds count, the next hospital emergency department that closes because of lack of funding just may be the one down the street from you. When your child stops breathing and you have to drive an hour or more in traffic and hope that you get to the hospital before your child dies, think of the California Supreme Court’s ruling about balance billing and ask yourself whether the lives of your family were worth $57. My advice to California emergency physicians: Leave. My advice to California emergency physician groups: Give notice to each and every hospital that you work at that you will not renew your contract and send the notice to the editors of the newspapers. Then leave. My advice to other groups that might want to do business in California: Avoid California like the plague. My advice to Californians: Put some law firm phone numbers on your speed dials for when you have a medical emergency. After all, everyone knows that lawyers are more important than doctors, anyway. I said that cases like this ...

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Health Care Reform Survey Proves A Point

A new survey of 1,628 adults by the Kaiser Family Foundation puts the brakes on the notion that the desire for health reform is … well … universal. Overall, healthcare reform ranks third on Americans’ priority list for the new administration – behind improving the economy and fighting terrorism, but ahead of reducing the budget deficit, improving schools, and dealing with Iraq. There is general agreement on issues such as providing universal coverage, limiting administrative expenses of insurers, and getting rid of exclusions for pre-existing conditions. But public opinion changes when people learn about the effects of their decisions. For example, 71% of people favor Obama’s idea to require employers to provide health insurance to their workers, but support drops to only 29% when told that the plan may involve employers laying off workers. Two thirds of people also thought it was a good idea to require all Americans to have health insurance … until they found out that some people would be forced to purchase insurance that was too expensive or something they didn’t want. Support for that idea suddenly dropped to 19%. Nearly 2/3 of people would be less likely to support a plan that increased their own costs and less than half of those polled were willing to pay higher insurance premiums or taxes to help cover the uninsured. Instead, 70% of those polled wanted to increase taxes for those earning more than $250,000 per year. In summary, it seems that most people in the survey want “The best health care someone else can pay for.” Got a news flash for all those who were surveyed: The concept isn’t flying now and it won’t fly in the future. If you’re expecting to get better medical care at a lower cost, you’re kidding yourselves. If we aren’t careful about our choices, we might get neither.

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Where's the Handbasket?

I got two e-mails today asking for a comment on two recently publicized court cases. They both tie in to one common theme: It’s pretty clear where our medical system is headed – now it’s just a matter of the vehicle we’re going to use to get there. The one to the right is probably the most common one used to get to this destination. One involved the California Supreme Court’s decision to bar emergency physicians from “balance billing” in the emergency department. Before this decision, there was a tension between emergency physicians who wanted to be paid fairly and insurers like United FraudCare that want to charge patients as much in premiums as possible while paying as little as possible to the medical providers so that they can keep earning their $45 billion per year and maintain their #35 ranking on the Fortune 500. [wp_campaign_3] Emergency physicians refused to sign on with the insurers given the low compensation that was being offered. Then, when an insured patient was seen in the emergency department, the emergency physicians received some of their fee from the insurer and “billed” the patient for the “balance” of the fee – hence the term “balance billing.”   Now, the California Supreme Court’s decision states that even if the emergency physicians have no agreement with the insurer, they have to take what the insurer pays them as compensation. Emergency physicians can’t bill the patients for the “balance.” If the providers deem that the emergency physician’s services are worth 25 cents, that is what the physicians have to take. The physicians can try to get the remainder of their fee back from the insurers. Patients can’t get billed for it. Of course, if the insurers don’t pay the remainder, what recourse do physicians have? Nothing. Can’t stop treating the insurer’s patients. Federal EMTALA statutes state that emergency departments have to provide an evaluation and stabilizing treatment to EVERYONE. So if emergency physician groups don’t like it, they are stuck filing more lawsuits and paying more lawyers’ fees to try to get paid fairly. The other case involved a rheumatologist who was forced to pay $400,000 because he allegedly “refused” to pay for a sign-language interpreter for a deaf patient. The physician was only making $49 per visit from Medicare, but would have to pay $150 to $200 per visit for a sign language interpreter. Instead, the physician used the patient’s family and used written notes to communicate with the patient. The patient sued the physician for discrimination under the Americans With Disabilities Act. My opinion of both of these cases is that they are a good thing. Kidding aside. I really am glad that they are happening. Think about the effects of cases like these. How many emergency physicians are going to want to work in California? I know I wouldn’t even think about a job offer there – knowing that I would likely be able to collect little to nothing for my services because the California Supreme Court held that some magical contract is created between all emergency physicians and all insurers and that those contract terms de facto provide insurers with unlimited bargaining power. Once service contracts run out with the hospitals, I foresee a lot of hospitals having a difficult time staffing their emergency departments. Care will suffer, people will die on waiting room floors, public outrage will force immediate change. How many private practitioners are going to want to accept deaf patients into their practices? If we’re talking about providing translation in general, how many physicians will want to accept anyone that doesn’t ...

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