Medicare

State Health Policy Resources for the COVID-19 Era

By M2|2020-03-26T17:05:27+00:00March 26th, 2020|Health Care Trends, Medicaid, Medicare, State Health Initiatives, Uncategorized|

State Health Policy Resources for the COVID-19 Era

M2’s focus has always been state health policy, and right now, WOW, there’s a lot of action at the state level! We pulled together a list of resources for anyone wanting to take a closer look at state actions and/or policies by state. See our list below and feel free to share additional state level policy resources you are finding useful.

Council of State Governments (CSG) is tracking state resources and restrictions and executive orders by state
Kaiser Family Foundation (KFF) is tracking state policy actions to address coronavirus with information in map, chart, and table form
The Center for Connected Health Policy is tracking state telehealth coverage policies in the time of COVID-19
Go to these CMS links for info on two popular Medicaid waivers right now:
1. Section 1115 waivers by state
2. Section 1135 waivers by state
The National Conference of State Legislatures (NCSL) is also posting state health policy COVID-19 related resources, including a map showing the open/adjourned/suspended status of state legislatures
The National Governors’ Association (NGA) is sharing their state action tracking chart via spreadsheet and PDF

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“Medicare-for-All” Understood as Lower Premiums for Me?

By M2|2019-05-07T20:39:01+00:00May 7th, 2019|Health care spending, Health Care Trends, Health Plans, Health Reform, Insurance, Medicare, Medicare For All, Out-of-pocket spending, Uncategorized|

“Medicare-for-All” Understood as Lower Premiums for Me?

Proposals for Medicare-for-All, or more accurately, universal health coverage, are being introduced by both Congress and state legislatures at a rapid pace (see this useful interactive tool, The Many Varieties of Universal Coverage from The Commonwealth Fund). While policy types argue over how such a plan would be funded and how to set reimbursement rates for providers, and Wall Street frets about what single payer health coverage would do to health insurance companies, state legislators and regular people seem to have a different perspective. In my many conversations with people across the country about the idea of “Medicare-for-All,” I have found it striking how often people say they favor such an approach because they want lower health insurance premiums.

I think we may have a language problem. When health policy people hear “Medicare-for-All”, they think “change the health care delivery and insurance infrastructure from employer contributions to taxpayer contributions,” but maybe when regular people say “Medicare-for-All”, they mean “please find a way to lower my premiums”. The Kaiser Family Foundation Health Tracking Poll conducted in early January hints at the importance of lower premiums as a reason to support “Medicare-for-All” type proposals. As shown in the figure below, nearly 50% of people polled strongly favored proposals that allow people between 50 and 64 years of age to buy in to Medicare, or allow people to buy in to Medicaid, or create a plan like Medicare that is available to anyone. Getting insurance from a single government plan is strongly favored by only 34% of respondents.

These “buy-in” proposals may be gaining in popularity as people lose access to employer-sponsored insurance. Here is the math: “if the coverage rate for employer-sponsored insurance was the same in 2017 as it was in 1999 (67.3%), almost 24 million (or 23.8 million) additional people would be covered through an employer plan in 2017.”

It’s easy to understand why people would focus on lower health care premiums; rising premiums are having a big impact on household incomes. As fewer people are receiving health insurance through their employer, they are also being exposed to higher costs for health care premiums. We pulled recent information on employer and worker contributions for health insurance, the average national premium for a person earning just over 400% of FPL ($49,000) to buy a health plan on the ACA Exchange at various ages, and Medicare premiums. We then created a rough comparison chart of what premiums an individual might have to pay for health insurance based on how they accessed coverage. Below is what we found:

Notably, the average annual premium for employer-sponsored coverage of an individual was about $6,900 last year. But employees usually paid just 18% of that amount. For people who may have been covered by their employer for years, and then have to buy insurance in the ACA Exchange, the loss of that employer-sponsored contribution to their health insurance coverage could be quite a shock.

It’s a catchy phrase and easy to hashtag in social media, but is the appeal of Medicare-for-All driven largely by the hope that a person’s premiums will be lower? Is Medicare-for-All the best or only way to achieve lower premiums? As with all policy issues, we should probably start with the key question, “what problem are we trying to solve” and then go from there, always checking to see that we are, in fact, addressing the problem we are trying to solve with a workable solution.

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Same health care, different setting, but much higher costs

By M2|2019-04-25T20:36:11+00:00April 24th, 2019|Health care spending, Health Reform, Insurance, Medicare, Uncategorized, What do we pay for and why|

Same health care, different setting, but much higher costs

There is so much health care news happening right now, you may not have seen this, but different services cost different amounts, depending on where they were delivered. While this concept isn’t necessarily news to health care policy types, this latest data set and accompanying graphics make the issue clearer than ever and beg for a policy fix.

The Centers for Medicare & Medicaid Services (CMS) finalized the Hospital Outpatient Prospective Payment and Ambulatory Surgical Center Payment Systems and Quality Reporting Programs Rule November 21, 2018, implementing site neutral payments for hospital outpatient clinic visits. The policy essentially reduces payments for services provided in outpatient settings to the same level as the payment made for the same service in a physician’s office.

However, the policy change applies only to Medicare, which covers less than 20% of the U.S. population. The commercially insured, for example, via employer-sponsored insurance and the individual and small group market, account for 56% of the population (see Charles Gaba, The Psychedelic Donut: Types of Coverage in the U.S.).

Wouldn’t a similar policy for people who receive health insurance outside of Medicare be a way to reduce costs?

Outpatient setting is always more expensive…

The Health Care Cost Institute compared a common set of services performed in physician’s offices and outpatient hospital settings and found “for this set of services, the average price was always higher in an outpatient setting than an office setting.”

Services that saw a significant change when provided in an office vs. an outpatient setting varied by service. Some of the bigger changes were for ultrasounds, upper airway endoscopies, and drug administration. For example, “in 2017, 45.9% of level 5 drug administration visits occurred in outpatient settings, compared to 23.4% in 2009.”

Not only did prices increase over time for both settings, the site differential for some of the visits was stunning.

We took the HCCI info and added a calculation of our own for a few of the visit types to show the percentage difference between the price of a visit in the office setting vs. outpatient setting, as shown in the table below.

It is also something that should be made transparent to patients. As mentioned in a recent , health care costs are rising and people are struggling to afford those costs. States are passing transparency bills left and right (hospital transparency, drug price transparency), even though it is unclear how “transparency” actually lowers costs. However, implementing site neutral payments for all payers (not just Medicare) is a more obvious, and more immediate, improvement to rising health care costs.

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Who Should Be Allowed to Help Patients Pay Health Costs?

By M2|2018-06-06T17:07:51+00:00June 6th, 2018|Health care spending, Health Care Trends, Health Reform, Insurance, Medicaid, Medicare, Out-of-pocket spending, Reimbursement, State Health Initiatives, Uncategorized|

Who Should Be Allowed to Help Patients Pay Health Costs?

If you can’t pay your health insurance premium, should you be allowed to have someone else pay it for you? What about your deductible? Your co-insurance or a copayment? These might seem like trick questions, but no. There really are circumstances when a person can’t receive help for health care costs. In the past few years, this has become a hot topic in health policy circles as health care costs continue to rise. At issue is a fundamental question we have considered before: whose health care costs should be managed, those of the healthy or the sick? Is it better to have sick people pay more so that healthy people who buy insurance can keep their premiums low? Or is it better to spread catastrophic health costs across larger pools of people so everyone pays a little in order to avoid ever paying a lot?

Third-party payments: Friend or foe?

When the Affordable Care Act was being debated nearly a decade ago, the American Enterprise Institute correctly pointed out, the entire U.S. health care system “relies on a third-party payment system.” That is, either individuals or employers make payments to insurers who in turn make payments to health care providers, or taxpayer money is used to pay health care providers who care for people covered by Medicaid, Medicare, TriCare or other public programs.

While the big picture debate of how to finance and provide health care services and for whom continues, this blog is focused on a more specific type of third-party payments (TPP). Right now, states and the feds are being asked to weigh in on which third parties should be allowed to pay insurance premiums or healthplan-required cost sharing, for example, a deductible or a health care service or product copayment. The debate at this moment is focused on people with chronic, severe, or expensive health care needs – people who need kidney dialysis, for example. The feds have been trying to work out guardrails since 2013 related to whether a third-party organization can pay for a person’s premiums in the state insurance exchanges. (For a deeper dive, go here). California has also joined the fray and is considering a bill, SB 1156, “Health care service plans: 3rd-party payments,” setting forth who will be allowed to make TPP for health insurance premiums.

Representing the “foe” side is America’s Health Insurance Plans (AHIP). A recent brief titled “How Third-Party Premium Payments Can Harm Consumers and Destabilize Markets” argues that TPPs from “entities steering Medicare and Medicaid eligible beneficiaries into qualified health plans (QHPs) sold through the Affordable Care Act (ACA) marketplaces…can increase the number of older and less healthy individuals in the individual market risk pool, resulting in higher premiums for all consumers and further destabilizing the market.” In support of SB 1156, the California Labor Federation presents a similar point-of-view, arguing that allowing TPPs of premiums for individuals with chronic or severe illnesses “also shifts costs onto commercial plans, driving up health care spending and increasing premiums for Californians already struggling with rising costs.” Who should pay when a person is sick? Is it always the better choice to shift costs to taxpayers by requiring a person who needs dialysis to enroll in Medicaid or Medicare, as AHIP suggests? How should we balance the interests of individuals and employers who want low health care premiums with the needs of patients with high health care costs?

Representing the “friend” side is The Commonwealth Fund in “Assessing the Promise and Risks of Income-Based Third-Party Payment Programs.” Their brief acknowledges the policy debate outlined above regarding TPP programs serving patients with specific health diagnoses, but focuses on TPP programs that address health care costs for a different population, noting, “History suggests that TPP programs can address low-income consumers’ affordability concerns on a large scale.”

Many of the guardrails set forth by The Commonwealth Fund parallel the California bill, including basing eligibility for TPP on income and paying “consumers’ premium shares from the point of enrollment through the end of the coverage year, thus preventing short-term enrollment that ends once a course of treatment is complete.” These guardrails seem to address several of the foe’s concerns. First, basing TPP on income means both the healthy and the sick can gain access to health insurance, which makes it much less likely that premiums rise due to a sicker risk pool. Second, AHIP argues consumers can be harmed “particularly if the third party stops making premium and cost-sharing payments once initial treatment is received, which could result in serious or life-threatening interruptions in access to care.” Requiring entities that provide TPPs to pay for more than just initial treatment addresses the foe’s concern.

I’m an aunt. Can I pay for my nephew’s prescription drug cost sharing?

One of the remaining concerns at the heart of TPP for health insurance premiums or health plan required cost-sharing (such as co-payments) relates to whether the organization making the TPP is motivated by financial gain or is steering patients to specific health care products, services, or providers. Federal law prohibits most TPPs in federal health programs, for example, Medicaid and Medicare, considering the TPPs to be in violation of one or another fraud and abuse law, such as the Anti-Kickback Statute and the Physician Self-Referral Law (Stark law).

While it makes sense that a health care provider should not be allowed to accept bribes, it is much less clear who should be allowed to help patients pay health costs. The way the U.S. health care system works today, if a person is not eligible for government-sponsored health care (for example, through Veterans Affairs, Medicare, or Medicaid) and they cannot pay for individual health care costs, whether premiums or cost-sharing such as copayments or deductibles, the person can usually be denied care. To be clear, AHIP is arguing that private entities, or groups of people, cannot come together and help such an individual make the health plan-required payments. The California bill says, “Any member of the individual’s family” can make a TPP, but then goes on to define “family” only to “include the individual’s spouse, domestic partner, child, parent, grandparent and siblings.”

This begs the question of what should be allowed when it comes to TPPs. What entities should be allowed to pay for patient’s health care costs?

Medical crowdfunding, such GoFundMe campaigns?
Health care sharing ministries?
Contributions gathered voluntarily by employees to help a co-worker with cost-sharing requirements? Or by a congregation to help a fellow churchgoer?
Employer emergency funds?
Family members helping family members, (let’s say Aunts, for example…)

It is quite clear that the alternative to the TPP being made is no payment being made, which certainly would cause an interruption in access to care for the patient who needs it. Like most health policy issues, TPPs can be either friend or foe and a one size fits all policy won’t work. Creating guardrails focused on allowing entities, including those in the list above, help patients pay their medical bills should be paramount.

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Paying to Address Social Determinants of Health: Medicare Advantage to Offer “Supplemental Benefits”

By M2|2018-05-07T14:32:50+00:00May 4th, 2018|Health care spending, Health Care Trends, Medicare, Social Determinants of Health, Uncategorized, What do we pay for and why|

Paying to Address Social Determinants of Health: Medicare Advantage to Offer “Supplemental Benefits”

CMS recently announced it will change its policy regarding Medicare Advantage plans and the scope of “supplemental benefits” these plans may offer. As of the 2019 plan year, CMS says it is reinterpreting existing law and expanding the options that Medicare Advantage plans may offer to enrollees.

In the past, CMS has not allowed an item or service to be eligible as a supplemental benefit – an additional benefit beyond the standard benefits under traditional Medicare – “if the primary purpose includes daily maintenance,” the agency says.

However, in the 2019 final Call Letter for Medicare Advantage, CMS says the policy change will “expand the scope of the primarily health-related supplemental benefit standard” to allow benefits used to “diagnose, prevent, or treat an illness or injury, compensate for physical impairments, act to ameliorate the functional/psychological impact of injuries or health conditions, or reduce avoidable emergency and healthcare utilization.”

Items and services under this expanded scope could include things like “air conditioners for people with asthma, healthy groceries, rides to medical appointments and home-delivered meals,” a recent article in Kaiser Health News notes.

Transportation, different food options, and items such as grab bars in bathrooms might be covered options now. While a physician’s order or prescription is not necessary, the new benefits must still be “medically appropriate” and recommended by a licensed health care provider.

While public health types (me included) often focus on explaining what a social determinant of health is and how it could be addressed in order to improve health equity, this policy change is significant in that it attaches payment to interventions – even if they are not clinical – that could lead to improved health.

Separately, the most recent federal budget agreement lifts the annual caps on the amount Medicare pays for physical, occupational, or speech therapy, and streamlines the medical review process. This policy change will apply to both traditional Medicare and Medicare Advantage enrollees.

As of Jan. 1, Medicare beneficiaries will be eligible for therapy indefinitely as long as their provider confirms their need for therapy and they continue to meet other requirements. Also, under a 2013 court settlement, enrollees will not lose coverage “simply because they have a chronic disease that doesn’t get better,” KHN says.

In an interview with KHN, Judith Stein, executive director, Center for Medicare Advocacy, said, “Put those two things together and it means that if the care is ordered by a doctor and it is medically necessary to have a skilled person provide the services to maintain the patient’s condition, prevent or slow decline, there is not an arbitrary limit on how long or how much Medicare will pay for that.”

These are innovative moves on CMS’s part; they show the agency recognizes the need for a more holistic approach to health care for Medicare enrollees and that it’s willing to address the social determinants of health, such as the impact of the home environment on a patient’s health.

CMS is now moving beyond purely “medical” treatments for Medicare Advantage enrollees and addressing broader aspects of health. We get what we pay for, and by covering different types of care, CMS is encouraging actions that may lead to improved health outcomes and avoidance of some preventable health events for patients.

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It’s a Hospital, It’s a Health Plan, It’s Both!

By M2|2018-04-20T18:55:42+00:00April 20th, 2018|Health care spending, Health Plans, Hospitals, Insurance, Medicaid, Medicare, Uncategorized|

It’s a Hospital, It’s a Health Plan, It’s Both!

Tufts Health Plan (Watertown, MA) and hospital company Hartford HealthCare (Hartford, CT) have announced a joint venture to form an insurance company, which will focus on providing those over 65 who qualify for Medicare the alternative of purchasing a Medicare Advantage plan.

The “twist” with this joint venture is that it will bring together an insurer and a hospital firm in one company and “it’s a first for Connecticut.”

Like many of the new health care collaborations sprouting up, such as Aetna-CVS and Berkshire Hathaway, Amazon and JPMorgan, the name of the game right now is using data better to try to lower costs.

Hartford is looking to Tufts Health Plan to bring “insights around closing gaps in care, identifying members who have needs they may not even be aware of and better coordination of care,” James Cardon, Hartford’s chief integration officer, told the Hartford Courant. Tufts has 1.1 million members across New Hampshire, Massachusetts, and Rhode Island.

Collaborations between health plans and providers are not unknown; however, they are in “relative infancy, and many of the approaches don’t involve as extensive as a commitment that is implied and inherent in a joint venture,” according to Tufts CEO Thomas Croswell.

A key advantage of the joint venture is that it will combine clinical data from Hartford with claims data from Tufts Health Plan, giving the partners the ability to reach out to members. Inherent in these concepts is reaching patients before they have serious health care needs.

Hartford HealthCare CEO Elliot Joseph explained the joint venture was built specifically to address both organizations’ realization that there’s room for improvement in care for patients with chronic conditions, especially in helping seniors manage their care in order to avoid hospitalizations. If reducing costs is the goal, it makes sense that Tufts and Hartford HealthCare are focusing initially on seniors, given their high use of health care services; however, such a strategy is unlikely to work for other populations.

In another example of provider-insurer consolidation, Centene Corp., a Medicaid managed care insurer and the “dominant health plan on the Affordable Care Act exchanges,” plans to buy Florida-based primary-care provider Community Medical Group.

Community Medical will boost Centene’s scale and capabilities around care delivery, and Centene will gain access to the provider’s patient population.

Community Medical Group operates 13 medical centers and two specialty centers serving more than 70,000 Medicaid, Medicare Advantage, and Affordable Care Act exchange patients in Miami-Dade County, FL. As of the end of last year, Centene had 848,000 Florida plan members, and that number is expected to increase as it grows membership in the ACA exchange in Florida.

Centene also announced recently that it has agreed to buy MHM Services, a provider of health care and staffing services to correctional facilities and government agencies, serving 330,000 people.

This strategic approach is all about controlling where plan members receive care, similar to previous deals where an insurer buys a provider group. UnitedHealth Group’s Optum subsidiary bought DaVita’s medical group and acquired Surgical Care Affiliates last year. Humana also bought home healthcare provider Kindred Healthcare last year.

The health care system in the U.S. is changing rapidly. With less direction (or interference, depending on your point of view) from the federal government, health plans and provider groups are leading the way in creating new approaches for care delivery. Whether payers, including employers and consumers are better off, is yet to be seen.

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