insurance

Health Payment Reform Can Bring Big Savings For Employers, Report Finds

Projected impact of growth scenarios on total employer savings on employer-sponsored health insurance. From "Benefits of Slower Health Care Cost Growth for Massachusetts Employees and Employers" by Jonathan Gruber and Ian Perry. (Courtesy)

WBUR’s Martha Bebinger reports that under new health payment reform (read cost-containment) plans currently underway in the state legislature, employers could save between $8 and $35 billion over nine years, according to a new analysis by MIT economist Jonathan Gruber.

That translates into direct financial benefits for workers, writes Bebinger:

Gruber says there’s a direct trade off between health care costs and wages. When premiums go up, wages don’t rise as quickly.

“What we’re saying here, by that same logic, is if we can control health care costs workers get more,” Gruber said.

In what Gruber calls a modest proposal, health care costs would increase 5 percent per year, just one point less than the expected 6 percent increase. The savings for employers would be $8 billion over nine years.

Under a more aggressive approach, health care costs would still rise, but only 2 percent per year. Employers would save almost $35 billion or about $1,000 per worker, per year. Continue reading →

FILED UNDER: Insurance, Money, Politics, cost, hospitals, insurance, payment reform

November 15, 2011 | 8:43 AM | By Rachel Zimmerman

Dropping Co-Pays Boosts Adherence, Health After Heart Attack

Can free medications help solve the problem of poor adherence among heart attack patients?

A new study by researchers at Brigham & Women’s Hospital (and funded, in part, by the insurer Aetna) concludes that eliminating co-pays for drugs prescribed after a heart attack improves patients’ medication adherence rates and health outcomes without increasing overall costs.

The research, published online in The New England Journal of Medicine, split heart attack patients into two groups: one with full insurance coverage — including all prescription drugs routinely prescribed after a heart attack, including statins, beta-blockers, angiotensin-converting-enzyme (ACE) inhibitors, and angiotensin-receptor blockers — and another with usual insurance coverage, including co-pays.

While adherence rates were incredibly low in both groups, study authors write: “Rates of adherence ranged from 35.9 to 49.0% in the usual-coverage group and were 4 to 6 percentage points higher in the full-coverage group.” Continue reading →

FILED UNDER: Insurance, Medicine/Science, Money, Personal Health, cost, heart attacks, insurance, prescription drugs

June 22, 2011 | 11:11 AM | By Rachel Zimmerman

Poorer Patients Help Subsidize Health Care For The Rich, Coakley Report Finds

Tucked into Attorney General Martha Coakley’s exhaustive investigation of the drivers behind escalating health care costs in the state is a startling, new and counterintuitive finding: the richer you are, the more your insurer is probably spending on your health care. And the poor are helping to foot the bill.

Indeed, the report says, it appears that lower-income people are subsidizing the higher-cost care of the wealthy — the Chelseas of the state lending a hand to the Wellesleys, in effect.

As far as the attorney general’s office knows, this is the first such analysis in the nation.

In what counts as a glimmer of irony in an otherwise serious document, the report says:

While we did not uncover any relationship between TME (total medical expense) and payment method, we did uncover a relationship between TME and patient income.

The relationship is this: “More money is being spent on the patients from higher income zip codes” and “those with lower TME may be
subsidizing the higher cost of care of those with higher TME in the same risk pool.”

To come to that conclusion, the attorney general gathered information from the state’s top three health insurers — Blue Cross Blue Shield of Massachusetts, Harvard Pilgrim HealthCare and Tufts Health Plan — on their members’ spending by zip code, and compared it to data from the IRS on average income. They found that the higher income zip codes had higher total medical spending, which includes what insurers spend on care plus the patients co-pays and deductibles. This spending, the report notes is “not explained by the member being sicker or older” and it doesn’t include services such as purely cosmetic surgery.

The attorney general found the same pattern among the commercial members of all three big insurers: the total medical spending for higher-income patients tends to be far higher than the total medical spending for lower-income patients. For instance, a Blue Cross member living in a tonier area like Wellesley with a six figure income is spending $437 per member per month on health care. That’s compared to a member living in a neighborhood like Chelsea, where incomes are considerably lower, who is spending $320 per member per month, according to the report. And both consumers, the richer and the poorer, are likely paying comparable premiums.

Interestingly, when investigators examined the data by region, they found the relationship between level of health care spending and patient income to be strongest in three areas: Metrowest, Northeastern Massachusetts, and Boston and its surrounding towns.

So what’s going on here? While there’s a stereotypical notion floating around that poor people burden the health care system with overuse, and therefore cost more, it turns out in Massachusetts at least, the opposite seems to be true.

The report says that in general, two factors drive differences in spending: price (richer people are using pricier providers) and use (the wealthier are using more health care services.) Continue reading →

FILED UNDER: Insurance, Money, cost of care, income disparities, insurance, Martha Coakley

February 23, 2011 | 11:08 AM | By Carey Goldberg

Pennsylvania Slashes State Health Insurance, In Contrast To Mass.

Tom and Paula Michele Boyle, Pennsylvania residents who are about to lose their state-funded insurance

File under “Reasons to be glad we live in Massachusetts.”

NPR reports today that Pennsylvania’s entire state-funded health insurance program for low-income adults is about to be cut, leaving 42,000 members uninsured. Nearly 500,000 people had been on the waiting list, hoping to join the program.

States around the country are facing similar cuts in this season of exploding budget crises. In California, Gov. Jerry Brown is proposing to slash more than a billion-dollar swath out of state health programs, as reported here.

Not here in Massachusetts. As WBUR’s Martha Bebinger reported earlier this month:

In a tough budget year, the Patrick administration is out with a strategy to maintain subsidized coverage for 174,000 low to moderate income residents. While states around the country are trimming government health insurance, Secretary for Administration and Finance Jay Gonzalez says Massachusetts will preserve near universal coverage. Continue reading →

FILED UNDER: Insurance, commonwealth care, insurance, jay gonzalez

December 15, 2010 | 11:52 AM | By Carey Goldberg

Prediction: Not Just Carrots But Sticks Coming To Wellness

Of these eleven sage predictions for health care in 2011 just posted by Evan Falchuk, president of Best Doctors, Inc., the one that grabbed me most was #5:

5. More employers will start charging employees surcharges for being overweight, smoking, or otherwise not taking care of themselves. Among self-insured employers, who pay for a huge proportion of American health care costs, this is becoming increasingly mainstream. These employers are saying to their employees: it’s your business if you don’t take good care of yourself, but it’s mine to pay for the consequences of it. So, employees are being told they need to pay extra for their health coverage, unless they participate in programs the employer makes available to help them quit smoking, lose weight and manage their chronic illnesses.

I’d just been thinking that even though I post a daily reason to exercise and I’m afloat in health information, it’s stunning how hard I find it to do the right thing in terms of diet and exercise every day. “I need coercion,” I thought. “I need a workplace where they make everyone go to gym class at noon.”

That won’t be happening soon, but I did ask Evan about this trend he’d identified — let’s call it the “wellness stick.”

It began two or three years ago, he said, and so far it’s happening mainly outside of Massachusetts, perhaps because we tend to be healthier already than other states.

One of the first companies doing this was PepsiCo, he said. The company’s head of benefits told him that their employees who smoke had been informed: “If you smoke, we’re going to charge you $600 a year extra in your health premium — unless you participate in a smoking cessation program. You don’t have to quit, you just have to participate.” They had huge success with people signing up — though the tactic is still playing out; many people quit, but many people have said they’ll just pay the $600.

Another example: The supermarket firm Safeway and obesity.
Starting about two years ago, Evan said, Safeway plotted its employees’ Body Mass Index scores on a chart, and found the expected bell curve but there was “a big lump on the right hand side of people with really high BMI,” to the point of clear health risks. Safeway said in effect, “We’ll have surcharges for those people because they’re costing everybody more money, but also create a very supportive environment to help them lose weight.”

“It’s the carrot and stick approach. It’s not enough just to dangle the carrot out there. A lot of companies are putting in these stick-like approaches,” Evan said, and he knows of several Massachusetts employers who are contemplating adding sticks to their wellness plans. (Though WBUR’s Martha Bebinger tells me that she’s been looking and looking for wellness sticks among state employers, and found none so far.)

Readers, does your company use a stick? Do you think that it should?

FILED UNDER: Money, exercise, insurance, wellness

November 11, 2010 | 6:32 AM | By Carey Goldberg

Daily Rounds: Health Insurance Profits Soar; Fosamax Questions; Probiotics For Diarrhea; Public Against Obamacare Repeal; Menino Fights For Insurance Flexibility

Health Insurance Profits Soar, Dem Calls For Rebates “Health insurance profits are skyrocketing in 2010 compared to last year’s returns and the outgoing chairman of the House subcommittee that oversees the companies is calling on them to return the profits to consumers in the form of premium reductions.” (Huffington Post)

Fosamax Lawsuits Question Wide Use of Osteoporosis Drugs – NYTimes.com “The trial is providing a palpable backdrop for a broadening debate among many doctors and researchers who are rethinking Fosamax and similar bone medications known as oral bisphosphonates, particularly as a treatment for women who have not yet developed osteoporosis.” (The New York Times)

Medical News: Probiotics May Help Treat Acute Diarrhea – in Infectious Disease, General Infectious Disease from MedPage Today “One way to battle diarrhea-causing gut bugs is to introduce even more gut bugs, two major reviews found.” (medpagetoday.com)

Poll: Public mixed on GOP tax, health plans – BostonHerald.com “When it comes to the health care law Obama signed in March, just 39 percent back the GOP effort to repeal it or scale it back. Fifty-eight percent would rather make even more changes in the health care system or leave the measure alone.” (Boston Herald)

Menino seeks more control over health insurance costs – The Boston Globe “Mayor Thomas M. Menino vowed yesterday to go to Beacon Hill to fight for a state law that would allow the city of Boston to save millions of dollar on health care insurance. Tweet Be the first to Tweet this! Yahoo! BuzzShareThis Menino said he could save at least $12 million a year if he gained the authority to shift a larger share of the city’s insurance costs from taxpayers to teachers, police, firefighters, and other city employees, retirees, and elected officials.” (Boston Globe)

FILED UNDER: Insurance, Medicine/Science, Money, Personal Health, Politics, fosamax, health care reform, insurance, osteoporosis, probiotics

November 1, 2010 | 11:47 AM | By Carey Goldberg

Non-Binding ‘Medicare For All’ On Ballots

Sure, Massachusetts is leading the nation in health care reform. But for some residents — quite a few, actually — it hasn’t led far enough.

Tomorrow, the ballots in 14 districts will include non-binding questions on whether the state should move to a “single-payer” system, also known as “Medicare For All.” To wit:

Shall the representative from this district be instructed to support legislation that would establish health care as a human right regardless of age, state of health or employment status, by creating a single payer health insurance system like Medicare that is comprehensive, cost effective, and publicly provided to all residents of Massachusetts?

With everyone still adjusting to state and federal health reform, why put the single-payer question on the ballot now?

Jon Weissman, a spokesman for the single-payer campaign in western Massachusetts, says that “it’s one part of a strategy to put together a legislature that will vote for single-payer.” A single-payer bill has been introduced repeatedly in the legislature for more than a decade, he said, and has always gotten plenty of sponsors, but never passed.

These days, he said, a powerful argument in its favor is that a single-payer system would be cheaper than the current health care system in Massachusetts. Also, other states are looking into single-payer plans, and “Massachusetts doesn’t want to not be a leader!”

But the “core answer,” he said, is that the ballot measure is “one of many tactics we use in order to keep the issue alive.”

In past years, such measures have passed overwhelmingly, but in famously liberal enclaves like Amherst, Jon said. This year, the districts that will vote on the measure are more middle-of-the-road, politically. Continue reading →

FILED UNDER: Money, Politics, insurance, mass-care, single-payer

October 29, 2010 | 11:55 AM | By Carey Goldberg

Dr. Tim’s Top Ten Health Reform Points

There’s something about Dr. Tim Johnson, the longtime ABC medical correspondent. You trust him. If he wrote you a prescription, you’d fill it. These days, he’s writing a prescription for the entire country, trying to cure the health care system of its spiraling costs. (He’s currently scheduled to appear Nov. 8 on WBUR’s “On Point.”)
As mentioned here, he has a new e-book out, “The Truth About Getting Sick in America.” He kindly consented to distill the whole thing down into its ten most essential points:

1) The US spends more than twice as much per person on health care as the average of all other industrialized countries ($7538 vs.$3060 in 2008) BUT we get no better outcomes AND we are the only industrialized country without universal insurance coverage.

2) For example, the five-year survival rates for 17 cancers are virtually the same in the US and Canada even though we spend almost twice as much per person ($7538 vs. $4079 in 2008).

3) And even within our own country, there are enormous differences in expenditures (adjusted for cost of living) with no difference in outcomes. For example, in Medicare spending in 2006: over $14,000 per person in Miami vs. under $6000 per person in Salem, OR.

4) One of the major factors encouraging this high spending without better outcomes is our “fee for service” payment system that basically says to doctors, hospitals, drug and device companies: the more you do or sell, the more you make. In other words our payment system incentivizes health care providers to do more whether or not it makes any difference in outcome.
Continue reading →

FILED UNDER: Insurance, Medicine/Science, Money, Personal Health, Politics, cost, insurance, reform, tim johnson

October 25, 2010 | 10:18 AM | By Carey Goldberg

Mass. Health Insurers Punt On Premiums

WBUR's Martha Bebinger

WBUR’s Martha Bebinger reports today:

The state’s largest health insurers are hedging their bets on premium increases for businesses with fewer than 50 employees.

The approach boils down to: let’s wait and see who wins the tight race for governor. One candidate, Governor Deval Patrick, capped small business insurance premiums earlier this year — a step the insurers expect him to take again if re-elected.

To avoid another fight, with lawsuits and public battles, the insurers have decided to punt. The state’s top three health plans have all filed an extension of the capped rates, just under 10%, for the first three months of next year.

All the insurers continue to say they will lose money without a higher increase later next year. But they are leaving negotiations over what rate increase the state will allow until they know with whom they will be negotiating. Republican candidate Charlie Baker, a former Harvard Pilgrim CEO, does not support the insurance rate caps.
Continue reading →

FILED UNDER: Insurance, blue cross blue shield, insurance

October 13, 2010 | 6:58 AM | By Carey Goldberg

Daily Rounds: ‘Biggest Loser’ Study; Denial of Insurance; ‘Myth Of CSI’; Hospitals Lure Doctors; Vaccine Language

'Biggest Loser' workouts drop fat without losing muscle mass – USATODAY.com“The grueling boot-camp workouts on NBC's The Biggest Loser help contestants lose large amounts of body fat while preserving their muscle mass, a new study shows.”(USA Today)

Insurers Denied Coverage to 1 in 7 – WSJ.com “The four largest U.S. for-profit health insurers on average denied policies to one out of every seven applicants based on their prior medical history, according to a congressional investigation released Tuesday.” (Wall Street Journal)

The myth of CSI – The Boston Globe “The quality of American crime scene forensics is wildly inconsistent: many labs have poorly trained investigators, antiquated equipment, and cases backed up for weeks. In some labs, investigators have purposely altered test results in order to get findings that favor the prosecution.” (Boston Globe)

Hospitals Lure Doctors Away From Private Practice : NPR “Last year, half of new doctors were hired by hospitals, according to the Medical Group Management Association, a professional organization for physician practices. According to a 2009 report by the American Medical Association, 1 in 6 doctors works for a hospital, and the number is quickly growing.” (npr.org)

Supreme Court Hears Arguments in Vaccine Case Against Wyeth – NYTimes.com “Much of the argument concerned the meaning of the word ‘unavoidable.’” (The New York Times)