cost

RECENT POSTS

Mass. Launches A Grand Experiment: Pricing Health Care

There’s a grand experiment underway in Massachusetts and we are all, in theory, part of it.

Here’s the question: Can we actually list prices for childbirth, MRIs, stress tests and other medical procedures, and will patients, armed with health care prices, begin to shop around for where (and when) they “buy” care?

One of the first steps in this experiment is a new requirement that hospitals and doctors tell patients who ask how much things cost. It took effect Jan. 1 as part of the state’s health care cost control law and we set out to run a test.

Our sample shopper is Caroline Collins, a 32-year-old pregnant real estate agent from Fitchburg who is trying to find out the price of a vaginal delivery. Her first call is to the main number at Health Alliance Hospital in Leominster. From there, she is transferred to the hospital’s obstetrics department. A receptionist there tells Collins to call the billing office at UMass Memorial Medical Center in Worcester, Continue reading

Partners On Anti-Merger Report: ‘Misleading,’ ‘Flawed,’ ‘Inaccurate’

partners

Partners HealthCare does not hold back in the response it plans to file today with the state’s Health Policy Commission (HPC). The commission issued a report last month that marked a rare effort to crimp Partners’ dominance in the Massachusetts market. The commission said that if Partners adds South Shore Hospital in Weymouth to its growing network, costs will increase around $23-26 million a year.

Wrong, says Partners, in an 89-page rebuttal that includes dozens of letters and testimonials from South Shore area leaders who support the merger. The commission should withdraw its finding, concludes Partners, and not send the proposed merger to the state attorney general for further regulatory review.

Some key points from Partners’ response:

1) The merger would not “add $23-26 million in annual physician health care costs.”

Partners says the HPC doesn’t understand how Partners’ physician contracts work. The assertion that the merger “will result in significant annual physician cost increases is based on material misunderstandings of both the Partners payer contracts and the process and goals of the parties’ proposed physician development efforts” in the South Shore Hospital area.

2) If there are any cost increases, they would be “offset” by better value and more efficient care.
Continue reading

The $26 Million Reason To Say ‘No’ To Partners

A merger between Partners HealthCare and South Shore Hospital would increase the state’s health care costs by $23-$26 million a year, according to a report due out today.

That substantial estimate from the state’s Health Policy Commission is based on three factors: more patients funneled to expensive Partners hospitals, higher payments for South Shore Hospital and more money for its doctors.

“Given the rather strange — bizarre some would say — pricing system in Massachusetts, by this merger, South Shore and the South Shore-affiliated doctors would get an immediate increase in their rates,” Stuart Altman, the commission board chairman, said.

(401(K) 2012/flickr)

(401(K) 2012/flickr)

The commission’s estimate, according to a summary of the report, does not include the effects of increased leverage Partners and South Shore could use to demand higher payments. The impact “will be substantial if payers are unable to prevent the exercise of this leverage in future negotiations.”

The report says there is no indication that this merger would improve quality or bring new services to the area.

Partners, which expects to receive the full report today, said the South Shore merger would improve care and lower costs. The state’s largest hospital network will have a chance to respond to the commission’s findings before they are final. Continue reading

Globe Scoop: Health Commission To Advise Against Partners Expansion

Have we entered a new era of tough hospital oversight?

That’s one possible takeaway from a Boston Globe report today that says the state’s new Health Policy Commission will — in a “a rare rebuke” — advise against an ambitious expansion plan by hospital system Partners Healthcare. The proposed acquisition of South Shore Hospital by Partners would “push up patients’ costs and stifle medical care competition in the region,” the Globe reports.

More from the story, by Rob Weisman:

partners

A report by the year-old Massachusetts Health Policy Commission details what might happen if Partners is allowed to acquire the 378-bed Weymouth hospital and a Partners-owned physicians group absorbs Harbor Medical Associates, which has 65 doctors on the South Shore.

It concludes Partners’ South Shore moves would not only increase premiums for consumers and employers and weaken rival providers, but also threaten the state’s ability to hit its overall target for holding down medical spending, according to several people briefed on the findings. Those people spoke on condition of anonymity because the report is not yet public.

The commission, created under the state’s 2012 cost containment law, lacks the authority to block Partners’ moves, but its findings come at a critical time for other regulators who do have that power.

Partners spokesperson Rich Copp said his organization had not yet seen copy of the Commission report, which he stressed is “preliminary.”

But he said: “This preliminary report creates an opportunity to begin a meaningful dialogue with the Health Policy Commission around our vision to reduce health care costs.” Continue reading

AG: Caremark To Pay MassHealth $2.6M For Not Reimbursing Pharmacy Claims

This just in from Massachusetts Attorney General Martha Coakley: Caremark, the national pharmacy benefits manager that also operates mail-order pharmacies, will pay $2.6 million to MassHealth — and $4.25 million in a multistate settlement — for failing to reimburse claims.

Mass. AG Martha Coakley (Wikimedia Commons)

Mass. AG Martha Coakley (Wikimedia Commons)

Here’s the AG’s news release:

A company responsible for processing and paying prescription drug claims will pay $2.6 million to the Massachusetts Medicaid Program (MassHealth) to settle allegations that the company failed to reimburse MassHealth for pharmacy claims paid on behalf of its subscribers, Attorney General Martha Coakley announced today.

Under the terms of the settlement with Massachusetts, Arkansas, California, Delaware, Louisiana and the Department of Justice, Caremark, L.L.C. will pay a total of $4.25 million. The $2.6 million paid to MassHealth represents approximately 63 percent of the total payment by Caremark.

“This settlement is the result of an investigation into allegations that Caremark failed to properly handle and reimburse pharmacy claims for certain customers in the Commonwealth, leaving MassHealth to foot the bill,” AG Coakley said. “Our office will continue to safeguard the taxpayers’ investment in programs designed to provide care and treatment to our most vulnerable citizens.”

Caremark, operated by CVS Caremark Corp., is a California limited liability corporation with its principal place of business located in Illinois. It operates as a Pharmacy Benefit Manager (PBM) throughout the United States and contracts with its client health plans to supply prescription drug distribution and claims processing to participants in the clients’ plans. Caremark also operates mail-order pharmacies, and contracts with retail pharmacies nationwide to dispense prescriptions to its Caremark Plan participants.

This investigation began in 1999 with the filing of a whistleblower lawsuit in United States District Court in San Antonio, Texas. The plaintiff in that case amended her complaint in 2005 to add claims on behalf of the Commonwealth under the Massachusetts False Claims Act.

The investigation reviewed allegations that Caremark improperly rejected, denied or reduced the reimbursement of pharmacy charges. Continue reading

Lingering Health Law Questions Jon Stewart Wants Answered

By Georgia Feuer
Guest Contributor

Last week Jon Stewart hosted Secretary of Health and Human Services Kathleen Sebelius on The Daily Show. During the interview, he kept returning to the same question: Why was the piece of the Affordable Care Act that requires businesses to provide health insurance delayed for one year, but the piece requiring individuals to obtain health insurance (the “individual mandate”) was not delayed?

In her answer, Sebelius mentioned that there are subsidies and tax credits available to individuals starting in 2014 and also that the so-called “employer mandate” affects a very small number of businesses. The employer mandate only applies to businesses with 50 or more employees. Only 5% of businesses have 50 or more employees, and most of these companies already offer insurance.

Screen shot 2013-10-14 at 1.11.38 PMBut Jon Stewart was not satisfied with her answer, and that is because she did not give the whole answer. The real reason why the individual mandate cannot be delayed is that it is too crucial to the success of health care reform. To understand why, let’s suppose that getting health insurance was, in fact, voluntary. Then the people who would be most motivated to purchase health insurance are those who are sick. Continue reading

Looking Back: What Really Happened At The Start Of Mass. Health Reform

A lot of Obamacare supporters point to Massachusetts as proof that signing up the uninsured is a big, but doable task. Here, in 2013, that’s a reasonable conclusion.

But back in 2007 and 2008 things were a lot messier, and some advocates for universal coverage were worried.

Here’s why:

2006 Romneycare handshake

In this April 12, 2006, file photo, then-Gov. Mitt Romney is seen with lawmakers and staffers after signing the state’s universal health coverage law at Faneuil Hall in Boston. (AP File)

1) It looked like the state had, by a lot, underestimated the number of people who would be eligible for free and subsidized coverage. (In 2006, the estimate was 140,000. By April 2008, the estimate rose to 225,000, based on early sign-ups. Enrollment plateaued at 177,000 in 2009.)

2) A dramatic increase in first enrollment put a strain on doctors and health care services at every level.

3) Patients, many of whom had not had insurance for years, had a lot of problems they hadn’t taken care of and were seeking more tests, surgery and other treatment that drove up costs.

4) State budget watchers started to panic. The governor’s office kept going back to the Legislature to ask for more money and a few top lawmakers began to question whether the state could afford to fund the coverage law.

5) Employers saw an increase in workers who, to avoid the individual mandate penalty, signed up for their employer’s coverage, which increased employers’ outlays for health insurance.

Of course we don’t know if people who’ve gone without insurance around the country will behave like Massachusetts residents.  Continue reading

Crazy Health Premium Ride Ahead For Mass. Small Businesses

hounddiggity/flickr

hounddiggity/flickr

Small business owners and residents who buy health insurance on your own: my sympathies.

The next time you renew health insurance may be an even crazier experience than usual. The Affordable Care Act is changing the factors insurers consider when setting your rates. And, some insurers will benefit more than others, based on a pretty complicated “risk adjustment” for their members. The result is a 30 percent spread between increases and decreases, as of Jan. 1, 2014. It’s the biggest difference in rates that anyone I spoke to has seen in Massachusetts.

Here are the rates for the beginning of the year, and for the next quarter, which the state put out:

Rates in August 2013 with the Massachusetts Office of Consumer Affairs and Business Regulation

Continue reading

Consumer Reports Rates Surgery; Hospitals Push Back

We, patients, need user-friendly ways to answer this question: Where’s the best place to go for a knee replacement, or cardiac care, or to deliver a baby?

It is virtually impossible to find an answer even though hospitals have reams of information about how often patients recover smoothly and how often they suffer infections, complications or even die after surgery.

A few groups are stepping into the void. The latest issue of Consumer Reports rates hospitals in Massachusetts, and across the country, on surgery. The “overall” scores surprised me.

From Consumer Reports' “Your Safer-Surgery Survival Guide”

From Consumer Reports’ “Your Safer-Surgery Survival Guide”

Carney Hospital at the top is hardly a magnet for patients needing surgery in the Boston area. Some hospitals that are have the lowest overall ratings.

I called Mass General, where the hospital’s senior VP for quality and safety, Dr. Elizabeth Mort, praised the goal of giving patients more information about the quality of care. But she says Consumer Reports’ methods have so many flaws that these ratings “do the patient a disservice.”

The ratings, Mort says, don’t accurately take into account:

- how sick the patient was when he or she came in for surgery or the severity of their disease
- how many other conditions the patient may have
- how many complications actually occurred

The ratings are also misleading, Mort says, because they pool different types of procedures in single category. For example, they pool many prostate procedures, even though some hospitals perform very specialized and difficult surgeries and some hospitals only perform the most basic operations.

Consumer Reports’ ratings are based on two factors: how often patients died in the hospital following surgery and how often they had an extended stay, which is often a sign there were complications. Researchers combed through Medicare billing records. Consumer Reports doesn’t have medical reports that would allow it to adjust for the issues Mort mentioned above.

“That’s a little bit of the point,” says Doris Peter, with Consumer Reports Health Ratings Center, “that clinical data is not widely available to the public and we can’t base our ratings on clinical data if it’s not made available.”

Dr. John Santa, medical director of Consumer Reports Health, says in the magazine that while the ratings aren’t perfect, “we think they’re an important step in giving patients information they need to make an informed choice.” And, he adds, “we hope that by highlighting performance differences, we can motivate hospitals to improve.”

The Massachusetts Hospital Association (MHA) says it supports “greater transparency regarding quality and financial data to better inform the public,” but that “Consumer Reports’(CR) continued efforts to rate US hospitals result in greater confusion rather than clarity with an oversimplification of this extremely complex and important subject.”
Continue reading

Boston’s Mostly Good Results In Health Savings Experiment

Boston is a major player in a critical national health care test: Can focusing on prevention, and paying doctors based on the quality of their care, actually save money?

After the first year of this experiment, the answer is: Maybe.

Nationally, 32 large hospitals and physician groups signed on as Pioneer ACOs (Accountable Care Organizations). 

They agreed to try to save money on Medicare patients while still making sure patients received regular check-ups, cancer screenings and kept problems such as high blood pressure under control. Results out today show that 18 of the 32 groups spent less on Medicare patients than doctors and hospitals outside this pilot project. Most of those who saved money got to keep half the savings.

All 32 groups met the program’s quality goals.  There was a disagreement about how tough the federal Center for Medicare and Medicaid Services should be in setting those 30-plus goals.  The issue may come to a head again this year when quality scores won’t just be reported, they will count towards or against what providers are paid.

Images_of_Money/flickr

Images_of_Money/flickr

In Boston, four of the five Pioneer ACOs spent less money on Medicare patients in the first year of the contract than the federal government projected they would spend if not operating as an ACO:

–Beth Israel Deaconess Care Organization (BIDCO) says it saved 4.2%.

–Mount Auburn Cambridge Independent Physicians Association (MACIPA) says it saved 3.4%.

–Partners HealthCare says it saved 2.4%.

–Steward Health Care says it saved money, but declined to say how much.

–Atrius Health, the state’s largest physicians group lost money.
Update: Atrius Health says a final tally, that includes the first quarter of this year, reduced its loss from 2.1% to .98%. Since this falls within the margin of error, Atrius will not have to return any money to CMS for the first year of the Pioneer ACO program.

Specifically $220 on each of its Medicare patients.  Atrius offered more specific numbers than any of the other Boston Pioneers (as a sort of challenge that the other organizations did not take up). Transparency anyone?

Atrius spent $10,665 on its Medicare patients before becoming a Pioneer ACO, and $10,885 after the first year.

“We thought we’d be at an initial disadvantage,” says Atrius CEO Gene Lindsey, “because we had already harvested much of the low hanging fruit, that some of the organizations might be able to harvest in the first year to show good results.  But the difficult work that would be necessary for sustained results…would really be a long-haul effort.”

At Partners, Vice President for Population Health Management at Partners HealthCare, Dr. Tim Ferris, says he “didn’t expect to be this successful in the first year of the program.”  Ferris echoes Lindsey’s long view. The changes needed to make an ACO work are “a long term effort that will pay off much more in five years than in the first year.” Continue reading