CHIPping away at the social contract

And then there were none

Long before the arrival of the Obama Administration with its explicit goal of expanding health insurance coverage to everyone, the country had achieved consensus on the need to insure all children. The Children’s Health Insurance Program (CHIP), first enacted in 1997, enables relatively low income families who don’t qualify for Medicaid to get low cost, high quality insurance for their kids.

Congress let funding for the program expire at the end of September. CMS and the states have been scrambling to shift other funds around to keep the program going. But time is now running out.

Alabama looks to be the first state that will have to close its CHIP program, according to Kaiser Health News. Seven thousand kids will be tossed off on January 1 (Happy New Year!) and tens of thousands more would exit a month later. Within a few months, all 9 million CHIP-covered kids across the US will be gone.

CHIP has had a dramatic effect in lower income states like Alabama, where the childhood uninsured rate dropped from 20 percent in 1997 to under 3 percent in 2015. Prior political fighting over CHIP funding back in 2004 led to long-lasting damage to the program, and we can expect the same or worse this time.

I cheered the election of Doug Jones in Alabama, and find it notable that his first pronouncement was a plea to Congress to fund CHIP even before he is seated. If everyone looked out for their constituents the way Doug does, this wouldn’t be an issue at all.

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By healthcare business consultant David E. Williams, president of Health Business Group.

Health Wonk Review is up at Workers’ Comp Insider

The Happy Holiday Health Wonk Review edition is up at Workers’ Comp Insider. Host and Health Wonk Review curator Julie Ferguson does a great job of pulling it all together. But I’m skeptical about whether Santa is really a regular reader.

CVS + Aetna. Are we sure this adds up?

CVS and Aetna. Love at second sight?

Many of the stories I’m reading about CVS’s acquisition of Aetna suggests the deal is a bold move to expand CVS’s retail clinic business.  See for example, CVS-Aetna deal has major implications for retail health, primary care practices in FierceHealthcare.

If the merger goes through, CVS plans to expand health services at its retail pharmacies, according to CVS and Aetna officials. Although it will take several years to accomplish, CVS will increase its number of clinics and add staff and equipment for a wider variety of treatments.

This seems like silly reasoning. If the idea is to get health insurers to offer plans that favor retail clinics, why not just contract with those plans? Aetna is a big company but as a national plan its market share in many geographies is relatively modest. Often –like here in Massachusetts– the local Blue Cross has the biggest market share. If CVS is big and powerful enough to actually buy Aetna, surely it can get that company and others to come to terms on retail clinics.

If there’s strategic logic behind the deal it’s more likely to be in the pharmacy management side of the business, where, for example, the combined CVS/Aetna will be the biggest player –but not a dominant one– in Medicare Part D pharmacy plans. That’s not so compelling.

Possibly, the two companies just wanted to do a big deal that wouldn’t get blocked by the Justice Department. Aetna already got slapped down for its attempt to merge with Humana, and CVS doesn’t have a lot of options for horizontal takeovers of other drug chains or pharmacy benefit managers.

There is some kinship between the companies. Both are New England based and CVS’s Chief Medical Officer, Troy Brennan previously held the same role at Aetna.

It seems just as likely that CVS will offer Aetna “products” through its stores. As @WilliamGerber points out on Twitter, CVS could sell Part D plans at retail. I’m thinking maybe CVS will eventually offer consumer friendly health plans from Aetna that go beyond pharmacy.

Certainly, the shadow of Amazon is hanging over the deal. CVS is extremely nervous about Amazon coming in and eating its lunch in a way that Walgreens never could. So it’s doing something Amazon won’t –getting more into third-party reimbursement.

Stay tuned. I look forward to seeing how this one plays out.

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By healthcare business consultant David E. Williams, president of Health Business Group.

#CareTalk: Is value based care here to stay?

In the November edition of #CareTalk, CareCentrix CEO John Driscoll and I cover everything from my recent accident to Amazon, with a dose of Doug Jones and Judge Roy Moore thrown in for good measure.

Overview:

(0:18) David talks about a recent accident that he was involved in and what he learned about the U.S. healthcare experience from a patient’s perspective.

(1:32) What does Maine’s Medicaid expansion say about healthcare in the U.S.?

(3:40) What are the implications of the 2017 elections on U.S. healthcare?

(5:40) Where do you see value-based care heading within the next year?

(7:18) Will the next HHS secretary be more successful than Tom Price?

(7:54) Roy Moore or Doug Jones?

(8:18) Will we have any healthcare deals on Cyber Monday in 2018?

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By healthcare business consultant David E. Williams, president of Health Business Group.

Ambulance bill rip-off: There’s always a public option

A Kaiser Health News story on sky-high ambulance bills caught my attention; I have a long-standing interest in out-of-network billing and a more recent experience of taking a pricey ambulance trip myself.

Taken for a ride? Ambulances stick patients with surprise bills, is not a new story. To sum it up: it’s not unusual for a patient to get a bill for thousands of dollars and then to be stuck with a big part of the charge, even if that patient is insured. That’s because many ambulance companies can make more money by being out-of-network. Unlike physicians and hospitals, ambulance companies don’t lose patients by being out of network and refusing to offer discounts. After all, if you need an ambulance you wouldn’t have time to shop around, and it doesn’t affect repeat business either.

The article cites an example of a Fallon ambulance in Chestnut Hill, MA, one town away from where I live. A patient was transported to Brigham and Women’s hospital four miles away and charged $3,660, which the article points out is $915 per mile. The insurer paid about half and half was the responsibility of the patient.

In my own case I was crossing the street in a crosswalk and was struck by a car making a left turn. My bill from Fallon was $3,427.50 for a one-mile ride, so at least on a per mile basis it was much higher than the Chestnut Hill example.

But to be fair, the bill comprises a base fee of $3,350 for an advanced life support ambulance plus $77.50 per mile. That works out to exactly the same rate as what the suburbanite paid ($3,350+4x$77.50=$3,660) and demonstrates that Fallon is not mainly charging for mileage, it’s charging for the equipment and personnel being ready to show up on a moment’s notice.

Much of the ire is directed at the ambulance company for price gouging and the insurance company for leaving patients hanging. There are calls to regulate prices and otherwise tighten the rules, and I’m sympathetic.

But notice this point a little further down:

” If the injury had happened just a mile away inside Boston city limits, he could have ridden a city ambulance, which would have charged $1,490, according to Boston EMS, a sum that his insurer probably would have covered in full.”

When you call 911 to report a fire or a crime in Chestnut Hill and anywhere else near Boston, fire fighters and police officers are dispatched at no charge. It doesn’t matter what insurance you have –or whether you have insurance– it’s a service provided by the local government as part of its budget. Police and fire fighters responded to my crash, too, but they aren’t sending a bill.

Cities and towns could do the same with ambulances if they want. Some, like Boston, do. Public ambulances can still bill insurance and individual patients, but they’re less likely to antagonize patients and insurers with outrageous bills.

So while we think of policy solutions for ambulance bill rip-offs, let’s not forget that there are public options and lots of hybrid solutions, too.

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By healthcare business consultant David E. Williams, president of Health Business Group.

Health Wonk Review is up at Xpostfactoid

It’s time for the Late Days of Empire edition of the Health Wonk Review, ably hosted over at Xpostfactoid.

Enjoy the wonkery while you still can!

Blockchain for healthcare: Interview with Fluree co-CEO Brian Platz

Brian Platz, co-CEO of Fluree

SilkRoad Technology co-founder Brian Platz has turned his attention to blockchain, with Fluree, a new Public Benefit Corporation that has introduced a scalable blockchain database for decentralized applications. Fluree is not healthcare specific, but there is a lot of potential for blockchain.

In this podcast interview we covered the following:

• (0:10) What is a scalable blockchain database and why is it important?
• (1:58) What are some of the most pressing database needs in healthcare? How different are they from the issues faced by other industries?
• (3:07) What are some of the healthcare use cases for Fluree?
• (5:15) You mention transparency and consensus as key attributes of block chain. Does that contradict healthcare’s needs for privacy and security?
• (6:35) Who will leverage the technology in healthcare? Who is likely to be left behind?
• (7:46) What impact, if any, will healthcare consumers and patients see as a result of Fluree?
• (8:51) Why is Fluree organized as a Public Benefit Corporation?

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By healthcare business consultant David E. Williams, president of Health Business Group.

Health Wonk Review is up at Healthcare Economist

Healthcare Economist has curated a very informative and readable Health Wonk Review, complete with a couple of video bonuses. Check it out!

How formidable would Amazon be in pharmacy?

Oops

I’m a big fan and customer of Amazon, having placed thousands of orders since 1998. I understand why retailers (and other businesses) quake in their boots at the thought of Amazon disrupting them. As a healthcare insider, I also understand why healthcare companies are especially nervous. Deep down, we understand that US healthcare is tremendously wasteful and inefficient and that Amazon could make the industry look bad and eat its lunch.

Still, I’m not convinced that Amazon is going to take over the pharmacy business, the latest topic of discussion. The Wall Street Journal (Amazon’s push into pharmacy is full of promise and pitfalls) has a piece and we’re also told that CVS’s play for Aetna is a direct result of the Amazon threat.

My own recent experience with Amazon left a bitter taste in my mouth and provided a glimpse of just how hard pharmacy could be. I don’t usually take painkillers, but the past three weeks have been an exception. Since getting hit by a car while crossing the street, I have been a pretty good customer for OTC pain meds. On a recent Sunday I noticed I was running out of ibuprofen, and rather than asking family members to do one more errand, I used Amazon to place a same-day order.

I pressed the button around 9 am, and was promised that my order would be at my doorstep by 9 pm. By around noon the item was “out for delivery” but it hadn’t arrived by 8:30 pm and I was starting to get a little worried. Nine o’clock came and went, and Amazon switched my status to “delayed.” Finally I had to ask my wife to go out to the pharmacy, which luckily for us is close by and open late. I would have had a difficult night without my refill.

Eventually Amazon canceled the order and said my address was undeliverable –a weird claim for a home that receives Amazon shipments nearly every day.

Most of the skepticism about Amazon’s entry into pharmacy focuses on new complexities like third-party payment, which are admittedly pretty serious. But my own experience shows that Amazon’s current infrastructure isn’t robust enough for the basics, so I definitely won’t be among the first to sign up for AmazonRx.

Of course Amazon isn’t the only one with shipment woes, and this experience was an exception to my usual good ones. Still, it gives me pause.

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By healthcare business consultant David E. Williams, president of Health Business Group.

Health Wonk Review: Disaster edition

Welcome to the disaster edition of the Health Wonk Review!

Fire, fire everywhere

At Workers’ Comp Insider, Julie Ferguson focuses on response and recovery in the California fires. The cleanup of the toxic devastation poses enormous environmental health risks to fire fighters and residents alike.  She also offers a tribute to the workers who battled the fires, including a little-recognized segment –prisoners who volunteer for fire fighting duty.

Can it get any worse?

Roy Poses at Health Care Renewal shares the Worst Revolving Door Health Care Case So Far.

After having followed and documented many instance of conflicts of interest and outright corruption affecting health care over the last 13 plus years, I am close to dumbfounded in response to the casualness that control of health policy and regulation is being handed over to top players in corporate health care who are most subject to these policies and regulation. 

Sabotage or bailout?

Leave it to InsureBlog to plumb the mysteries of the Trump Administration’s targeting of the cost sharing reduction component of the Affordable Care Act. It’s neither sabotage nor bailout we are told. It’s a clear look at the issues involved, but I do find Part 1 (why CSR is not a bailout) more compelling than Part 2 (why it’s not sabotage). Part 2 leaves out how the uncertainty created by Trump undermines the plans and asserts as a fact that the boost in premiums is comparable to what was happening on the exchanges anyway. It leaves out the broader context and other examples of sabotage.

#CareTalk – protecting the vulnerable

In this month’s episode of #CareTalk, CareCentrix CEO John Driscoll and your host, David Williams from Health Business Group chat about the recent hurricanes that have impacted the US and what can be done to protect vulnerable populations.

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That’s it folks! A light edition but I’ll take quality over quantity.