Guest blog on balanced billing from a veteran health advocate...

Friday, May 16, 2008

Beth Capell, Health Access' contract lobbyist extraordinaire, has been advocating for consumers for more than two decades. She offers these thoughts on balance billing, an insidious practice of some doctors and hospitals who decide to threaten insured consumers with aggressive collection agency if the consumer does not pay the “balance” between the insurer or HMO paid for their care and what the doctor or hospital wanted to be paid. (Relatedly, we reported on a recent and egregious example of balance billing):

“Balance” billing has been illegal for Medicare and Medicaid enrollees for decades. It is illegal for HMO enrollees if they go to a contract facility. And until a few years ago, we probably would have said balance billing was illegal when an insured consumer got emergency care, even at a non-contract hospital.

As consumers, we are sympathetic to doctors and hospitals who feel badly treated by HMOs and insurers. We know what that’s like.

But as consumer representatives, we are pretty impatient with doctors and hospitals that treat consumers badly. We don’t like that either. And when it is all about a billing dispute between providers and plans, we say a pox on both their houses: get consumers out of the middle.

Well, this week DMHC had a hearing on a regulation to do just that: to say that if a consumer with coverage regulated by DMHC gets emergency care, then the consumer is only responsible for applicable copays or deductible, not for the difference between what the emergency doctor or the hospital wanted to be paid and what the HMO paid. Health Access is fortunate that our representative at this hearing is Elizabeth Abbott, who formerly headed the federal Centers for Medicare and Medicaid Services (CMS) in the western region of the United States: she has heard plenty of plan-provider disputes in her day and has no surfeit of patience with whining. She reports that doctors are furious at the proposed regulation.

As we said, we are sympathetic to doctors and hospitals fighting with HMOs. And indeed we as well as the Department have spent endless hours listening to the complaining of doctors and hospitals.

After all that, we know several things: first, consumers deserve to be protected from bad behavior by doctors and hospitals as well as HMOs and insurers. Second, under California, doctors and hospitals that do not have a contract with the consumer’s HMO do in fact get paid and usually get paid in a reasonable period of time (less than 60 days). So what are the doctors and hospitals fighting with the HMOs about? It turns out it is not just about the amount of the payment but also what counts how.

You would think that it would be easy to decide that when an ER doc takes care of you because you have a broken bone, he should be paid for reading the x-ray or MRI, but it turns out whether that is part of the bundle of services or not is part of what providers and plans fight over. And they fight over it partly because there is no standardization of bundling. The docs, not surprisingly, want the bundling system the docs have developed (called the AMA/CPT code, if you care). But Medicare decided a long time ago that letting the docs set the rules by which they are paid does not make much sense and ditto with Medi-Cal.

And we made it lots more complicated in California when we allowed the development of the “delegated medical model”. (If your eyes are crossing, welcome to my world.) That means that Blue Shield does not just contract with individual docs, but instead contracts with Sutter Medical Group or Hill Physicians or Beaver or Scripps or some other outfit with thousands of docs and hundreds of thousands of patients. So if you are a Sutter Medical Group patient but you end up at UC Davis emergency room because that is where the ambulance took you, what are the rules for bundling the claim? Is that thing-y they put on your finger to check your blood oxygen in or out of the bundle? Is it the Medicare rules? The Sutter group rules? The Blue Shield rules? Or are you actually HealthNet? And why do you care? Well, probably you will when the ER doc or the hospital loses their
patience with the HMO and just decides to send you to collections and let you
fight it out with the HMO.

And yes, this is yet another way in which are current system piles on administrative overhead for no good reason. So in addition to fighting to prohibit balance billing of consumers, we are trying to help figure out how to minimize the provider-plan disputes by supporting a single set of rules for bundling as well as other changes.

The need to end balance billing got a lot more obvious this week when we found out that one hospital system in Southern California, Prime Healthcare, had sent over 6,000 Kaiser members to collections because Kaiser would not pay whatever Prime Healthcare wanted to charge for their emergency care. (link to OC Register
story) Prime Healthcare is a system that refuses to contract with most insurers---so it is not just Kaiser members who are at risk: it is anyone with insurance who walks into their emergency room. It looks as if Prime Healthcare took on Kaiser first but nothing prevents the hospitals from doing the same thing to consumers covered by other insurers that Prime fails to contract with. And Prime also seems to be engaged in the same old game that for-profit Tenet used to play of turbo-charging the charges for care so that the sticker price goes up and up.

As well as the proposed regulations, we are working on AB1203 (Salas) and SB981 (Perata) to prevent balance billing of patients who get emergency care. While both these bills are still in progress, we hope this year we can get consumers out of the middle of these provider-plan disputes.

Labels: BalanceBilling, Insurers, Schwarzenegger

posted by Hanh Kim Quach | Permalink | 4:53 PM


 

...and don't forget health reform

In Schwarzenegger's presentation on the budget Wednesday, when being grilled by the media on the specifics of his lottery proposal and other elements of his budget, he made a point to invoke his "don't forget health reform" pitch: he indicated it was a shame it didn't pass earlier in the year, and how he is still committed to doing health reform in his term.

"As you know, we have made severe cuts in health care. And when it comes to health care, what is even more painful is that we didn't get health care reform done, because that would have given Medi-Cal an additional $4 billion dollars. So we are going to go and continue staying on that subject of health care reform, and continue working with the stakeholders together to get this done."

Some, especially those in the Senate, used the budget crisis as an excuse to stall AB x1 1, the negotiated plan between the Governor and the Speaker, saying it wasn't the right time for such an ambitious effort in the middle of a budget crisis. Others, especially in the Administration, stated that the budget deficit only reinforced the urgency of health reform.

My take: Passing health reform would not have prevented the tough choices presented by the budget crisis, but it would have provided additional--and better--options for a solution.

What would have happened if the plan passed? AB x1 1 and its companion ballot measure would have raised $15 billion in new revenues for health care coverage expansions and provider rate increases.

There's no doubt that the cuts announced today and back in January take us in the absolute opposite direction--a cut of $2 billion plus in both state and federal funds. Instead of raising $15 billion with AB x1 1, we are facing gruesome cuts:

* Instead of expanding Medi-Cal coverage and broadening the eligibility rules, the Governor has proposed restricting eligibility.

* Instead of raising provider rates, the Legislature and the Governor has already cut those rates, so millions now have less access to doctors and hospitals.

* Instead of streamlining and simplifying these programs, the Governor proposes making them more bureaucratic and cumbersome.

* Instead of bringing in more federal matching funds, the Governor proposes making cuts and thus losing those matching funds, leaving even more federal money in DC.

* Instead of dramatically reducing the number of uninsured Californians and the resulting "hidden tax" on the health system as a whole, the Governor's proposal would markedly increase the rate of uninsurance, for children and families.

If we had passed health care reform and still had to deal with $2 billion in cuts, then that would have meant that we only had $13 billion for health care expansions and improvements--and so then we would have the choice of raising additional revenues to make the new expansions and commitments whole again, or restructure the proposal to work with the $13 billion (rather than $15 billion) raised. Any of those choices, while tough, would have been preferable to what we have now.

If adopted, the Governor's proposed cuts take us further from the goal: it digs a bigger hole, that will need to be filled before embarking on additional expansions.

Medi-Cal and Healthy Families are the foundation for health reform, on which additional expansions are built atop--but that only works if the budget that funds them are strong and sustainably funded.

We will also be pursuing legislative and policy reform that we believe lays a foundation for reform in 2009-10, and we are pleased that the Governor have indicated an interest in such efforts. But the budget is also a key foundation that needs a resolution this summer.

Even with these ugly budget cuts hanging in the air, I have to hope that the Legislature will once again decide to reject these health cuts as too severe, as they have in the past. I have to hope that constituents in rural and "red" areas care about their schools, emergency rooms, seniors and children as much as anyone else.

And I have to hope that the logic of health reform will prevail upon this Governor: that the best arguments against these cuts, and for revenues to prevent these cuts, were all made by this Governor last year as he stumped for health reform:

* that California is visionary enough to get everybody covered, and not leave people to be uninsured;
* that Californians are willing to contribute to support and expand health coverage;
* that we need to invest in our health care system, for its own sake and to bring in new federal matching dollars that are left in DC; and
* that investments in health care have broader benefits, including positive health, societal, and economic implications.

Finally, it's worth remembering that part of the Massachusetts health reform was a deal to restore of several key cuts to that's state's Medicaid program (for example, to benefits) made in previous years. Our work this year will be to prevent such cuts, so they won't have to be restored in the first place when we pursue comprehensive health reform in the near future.

Labels: Budget, Schwarzenegger, YearOfReform

posted by Anthony Wright | Permalink | 12:20 PM


 

Over a thousand patients reinstated...

Thursday, May 15, 2008

Major news today from Los Angeles, where the Department of Managed Health Care (DMHC) announced settlement agreements with Kaiser Permanente and HealthNet to automatically restore coverage to over 1200 patients who had their coverage rescinded.

Lisa Girion of the Los Angeles Times, who's been on this story like a hawk, has an early story.

Here's the Department of Managed Health Care's press release and text of the actual settlements with the two insurers. Kaiser had the bulk of the rescissions--over 1,000, even though they stopped the practice two years ago. The real question now is whether the other leaders in the individual market--Blue Shield, and especially Blue Cross, will also come to terms.

A few weeks ago, consumer advocates stood with the DMHC Director Cindy Ehnes when they announced that all of the 5,000+ people who had their coverage retroactively rescinded since 2004 would be provided an independent review process so that they can get their past treatments paid for, get appropriate restitution, and get reinstated for coverage going forward.

These settlements go beyond that, in getting the plans to reinstate the patients without the uncertainty and administrative hassle of a review, and with the agreement not to challenge the reinstatement in court--something that some plans were threatening.

We appreciate the Department's focus on getting people their care and coverage first and foremost. We are pleased that over a thousand patients will get reinstated without further procedural barriers and heartache. The patients will appropriately be made whole for the expenses they have had to bear, but also ensured coverage so that are not left alone and abandoned, uninsured and uninsurable because of their so-called pre-existing conditions.

And while we think the fines don't match the scale of the insurer's wrongdoing, the priority is to make the patients whole, and to make sure they have coverage. We appreciate the focus on back-end enforcement of this settlement and the possibility of much steeper fines, and hope the Department adopts a 'zero-tolerance' policy for further bad behavior by these insurers.

Thousands of other patients are waiting to see if their health plan will agree to a settlement, or if they will have to go to a more cumbersome process to get coverage, either through the Department or in court. It's sad that after all the attention on this reprehensible practice by insurers, we don't have the entire industry seeking to make this right.

Labels: DMHC, Insurers, Rescissions

posted by Anthony Wright | Permalink | 8:43 PM


 

It's worse than what you read...

The news coverage of the budget, if anything, has downplayed the impact of the budget on health care. Let me focus on what we consider is the biggest of the cuts newly announced yesterday, that would impact the most number of people.

The San Francisco Chronicle mentions that the Medi-Cal eligibility cut would mean that "40,000 poor working parents, who now receive comprehensive Medi-Cal coverage, would have their benefits reduced if they earn more than about $12,000 for a family of three."

Actually, these parents, who would make roughly $10,736-$17,600/year for a family of three, would lose access to Medi-Cal coverage. Some might be eligible for other programs, but many would simply become uninsured.

More to the point, the 39,000 people impacted in the first year is only the beginning. In a few years, after full implementation, the cut would deny coverage to 439,000 Californians.

The Los Angeles Times described it in this way, that the budget would "Deny thousands of impoverished parents healthcare coverage that they now have through the state's Medi-Cal program. Under the change, a single parent with one child who earns more than $8,540 a year would no longer be eligible." Tha was correct, but downplayed the massive scale of the cut--that the impact was eventually deny *hundreds of thousands* of Californians.

The Sacramento Bee has an article that doesn't go into the specific horror of the cuts.

The sidebar that describes the budget "highlights" doesn't even mention this cut to Medi-Cal eligibility--even though it is the health cut with the biggest impact in the May Revise. That sidebar does list some of the bad cuts, but also neglects to mention a major-dollar proposed cut from January, that would also eliminate key benefits, like dental, optometry, and podiatry, for millions of adults on coverage. It's unclear why some cuts were included and other, bigger cuts were not.

Let's hope that future coverage of the budget goes into the full implications of what is being proposed here. The cuts are bad enough that they don't need embellishment, but they do need coverage, so Californians can understand the stark choices, and how they would impact our fellow citizens and our health system.

Labels: Budget, InTheNews, Schwarzenegger

posted by Anthony Wright | Permalink | 10:19 AM


 

Other reactions to the health budget...

Wednesday, May 14, 2008

Shane Goldmacher at the Sacramento Bee's Capitol Alert has a useful compilation of some of the reactions to the budget. Here's some that touch on the health budget, from Health Access board leaders, member organizations, allies, and others:

Marty Hittelman, president of the California Federation of Teachers: “The governor’s budget revision tries to protect education, but lacks the funding to do it... Shifting the bulk of the cuts to health and human services is a disguised cut to education. These programs aren’t isolated from schools. Our students need to come to school ready to learn, and they can’t do that hungry or sick.” “School kids did not cause this crisis,” said Hittelman. “Their teachers and school staff are being confronted with uncertain futures. It’s time to put in place a fair, stable and progressive funding source for education and other vital services.”

Ted Lempert, president of Children Now: “It’s mind-boggling that too many of our state's leaders still can’t see the shortsightedness of cutting children’s health, education and economic support. California’s children currently are well behind national average measures of well-being and per-child funding. It’s also clear that investment in these programs today will reduce the state’s future costs and increase its future revenues. Yet California continues to make decisions that are leading us closer and closer to a next generation that can’t support our human capital needs and increasingly overburdens public costs. We’re shortchanging our future in big, bad ways.”

Annelle Grajeda, president of SEIU California State Council and SEIU Local 721: “We need our elected leaders to understand that the people of California will not accept cuts that hurt our children, seniors, and communities. The proposed budget reflects a short-term mentality, but we’ve got a long-term problem on our hands. Cuts that yield quick savings now but create costly problems later are unwise. This budget is a missed opportunity to move the ball forward."

Cathy Maupin, interim executive director of the California Children's Defense Fund: “In a state with the 8th largest economy in the world, it is a moral outrage that cuts to foster care, health coverage, cash assistance for children, and food programs are even being considered. Our policy makers must recognize that every step taken to improve the lives of children improves the lives of all Californians. Instead of structuring our state budget to address the urgent needs facing millions of California’s families, the Governor proposes once again to balance the budget on the backs of our state’s most vulnerable population: children. In many cases one family will feel the effects of multiple cuts simultaneously. For example, the same child receiving CalWORKs may experience a freeze in her cash benefits, be disenrolled from health care, and have her food assistance benefits reduced."

Tom Porter, California state director AARP: "AARP is extremely disappointed with the Governor’s 2008 May budget proposal, announced today. Far from improving upon his initial budget proposal, the Governor’s budget revision proposes even deeper cuts to critical services to the most vulnerable Californians.

AARP believes that highest priority in the budget process should be given to programs that serve the state’s most vulnerable populations – specifically low-income children, as well as disabled and older adults. The budget should not be balanced on the backs of these most vulnerable Californians. We believe our elected leaders should fully fund the “safety net” programs that are critical to the well-being of those who cannot care for themselves. Further, our health care system is failing. Drastic cuts have already weakened these critical programs. If approved, the Governor’s new proposal means fewer people will have access to services and the health care crisis will simply get worse. AARP believes that policymakers should consider revenue enhancements rather than cut services to California’s most vulnerable persons."

C. Duane Dauner, president of the California Hospital Association: "The May Revision of the Administration’s proposed 2008-09 State Budget contains bad news for health care consumers across California. With the state facing a projected $17.2 billion deficit, the proposal released today would result in crushing, disproportionate cuts to the Medi-Cal program - including up to $184 million in cuts to hospitals caring for the most vulnerable in our state. Adding insult to injury, these proposed cuts come on top of more than $1.3 billion in Medi-Cal reductions to all health care providers that were enacted earlier this year and are scheduled to take effect on July 1, 2008.

The additional payment cuts proposed in the May Revise include $22 million for inpatient services provided at hospitals that do not contract with the Medi-Cal program; $54 million in cuts to some public hospitals through the Safety Net Care Pool; and approximately $12 million in payment reductions in the Medi-Cal managed care program. Additionally, hospitals may experience up to an additional $96 million in losses as a result of changes being proposed to Medi-Cal eligibility and benefits.

If these additional cuts are adopted into law, more patients covered by the Medi-Cal program will not receive needed health care services. Some hospitals cannot meet payroll beginning in late June as a result of the 10 percent cuts and payment delays already enacted; other hospitals will be severely affected. It is a lose–lose proposition for both patients and hospitals.
California’s hospitals have a long-standing commitment to ensuring that every Californian should have equitable access to safe, affordable, high-quality, medically necessary health care. But this goal is endangered by the proposed slashing of the Medi-Cal program. California already ranks dead-last in the nation when it comes to funding health care for Medicaid patients. Further reductions only serve to fracture an already broken health care system, while at the same time costing the state in lost matching federal dollars."

Dr. Richard Frankenstein, president of California Medical Association: "These budget cuts will devastate access to health care for millions of poor Californians and will wreak havoc on the ability of middle class Californians to meet their health care needs. If this budget somehow passes and even a fraction of these cuts go into effect, Governor Schwarzenegger's legacy to the people of California will not be the health care reform he has promised, but instead a health care system damaged beyond belief.

All Californians should sit up and take notice. These cuts will not just take wheelchairs away from the disabled, deprive poor children of access to their critical health care needs, and leave seniors stranded. The cuts will also raise the costs of health care for employers and families, undermine the quality of care in emergency rooms, and shut down doctors' offices, hospitals, pharmacies, and clinics in communities across California. The health and well-being of all Californians will suffer under this budget.”

Labels: Budget

posted by Anthony Wright | Permalink | 11:59 PM


 

A deeper wound for our health care system...

HEALTH ACCESS UPDATE
Wednesday, May 14th, 2008


GOVERNOR'S MAY BUDGET REVISION MAKES DEEPER HEALTH CUTS

* Budget shortfall projected at $17.2 billion; Governor continues "cuts & borrow" approach
* Health cuts keep in place January proposals, goes further in directly denying coverage
* Hundreds of thousands of the poorest working families would lose coverage

Click Here for What's New on the Health Access WeBlog: Much more on the budget cuts; Welcome, Speaker Bass; Bass and health reform; Balance billing; Canadian health care; Underinsurance; Who gets hurt by a cuts-only budget?; High deductible health plans for who?; MRMIP's waiting list; McCain's risky high-risk pool proposal; The new opportunity for health reform; Big Tobacco's track record on reform; More on the McCain health plan.


SACRAMENTO--Gov. Arnold Schwarzenegger released the revised version of his budget proposal today, which makes deeper cuts in health and human services programs in order to address the state’s shortfall, which has grown by nearly $3 billion since he first released the budget in January. Altogether, the $100 billion general fund budget is $17.2 billion short.

“The crisis is very real and it is very serious,’’ the governor said. His proposal would attempt to bring in $11.7 billion in new money ($3.5 billion from deficit bonds of years past), and another $5 billion by selling the lottery’s income to Wall Street. Schwarzenegger would cut an additional $12.5 billion from state programs, on top of the $1 billion that was cut earlier this year to help minimize the deficit.

“We had to make very difficult cuts. No one wanted to do this. But because health and human services was the second largest part of the budget, this is where we had to cut,’’ Schwarzenegger said. Twenty percent of the cuts imposed come from Health and Human services, reported Director of Finance Mike Genest. Deficit aside, Schwarzenegger restored funding to some of his original cut proposals in January and will now keep parks open and will not release inmates nearing their release date early.

View the full May Revision at the website of the Department of Finance here: www.ebudget.ca.gov.

The Health and Human Services Agency has their summary of the health and human services cuts here, at:
http://www.chhs.ca.gov/Documents/HHS%20Budget%20Facts%20Final%205%2008.pdf

THE CUTS

CUTS ALREADY MADE (PROVIDER RATES): Health programs were already dealt a blow earlier this year. Medical providers that treat Medi-Cal recipients will see their reimbursement rates cut by 10% as a result of a budget cut package already approved earlier in the year. Already California ranks near the bottom for reimbursement rates for doctors caring for Medi-Cal patients. That cut -- saving the state $544 million (and losing an equivalent amount in federal matching dollars) -- will begin July 1st.

CUTS ALREADY PROPOSED AND STILL PENDING (MEDI-CAL BENEFITS, QSRs): Still pending from the Governor's January proposal are a range of cuts, such as eliminating benefits for adults on Medi-Cal, including dental coverage, optometry, podiatry, and other services. The pending proposals also included imposing additional paperwork burdens on children and families so hundreds of thousnads enrollees fall off the program (known as quarterly status reports).

NEW MAY REVISE CUTS: The Governor's May revision retain all cuts to health care proposed in January, that would make it harder for the 6.6 million children, parents, seniors and people with disabilities on Medi-Cal to get the care they need--by reducing access to providers, by eliminating benefits, by increasing paperwork so that it is easier to fall off coverage. The May Revision also does the one major type of cut that the January budget did not do--directly deny people coverage by changing eligibility rules. The May revision cuts of interest to health advocates are as follows:

* DENIAL OF COVERAGE TO LOW-INCOME WORKING PARENTS: Parents earning very low wages (roughly between $11,000 and $18,000/year for a family of three) would no longer be eligible for Medi-Cal coverage.

Under the new proposal, a family of three would need to earn even less: $891 a month, and work fewer than 100 hours a month. The cut is expected to reduce spending by $31.2 million this year, but increase to $342.5 annually in three years. In the first year of implementation, 39,000 parents would be denied coverage. After a couple of years of full implementation, over 429,000 Californians would be denied Medi-Cal coverage.

This proposal was also proposed for the 2003-04 budget by then-Gov. Gray Davis, but rejected. Earlier reform expanded coverage to these parents as part of welfare reform, so that families working their way off of welfare would not lose health coverage as they found jobs (that likely did not provide health benefits). If this cut stands, then the potential incentive is to work less, in order to keep coverage.

* CONTINUED BUREAUCRATIC ENROLLMENT PROCEDURES: The Administration, which had championed efforts to make it easier for families to enroll in public programs, is now further seeking to delay the implementation of SB437 (Escutia) of 2006, which would have streamlined and fast-tracked enrollment for children into Healthy Families or Medi-Cal. This delay saves the state $13 million.

* ADDITIONAL BENEFIT CUTS: Qualifying low-income legal immigrants who permanently live in the US will lose various benefits, including prescription drugs and dental coverage, and only get four services: emergency care, pregnancy-related coverage, certain long-term care services, and some cancer treatments. This would be a $86.7 million cut.

* MORE PAPERWORK FOR EMERGENCY SERVICES: The limited emergency services coverage that Medi-Cal provides to undocumented immigrants would be more limited, through the implementation of a monthly eligibility process. The savings would reduce state payments to California health providers by $42 million.

* CUT TO NON-CONTRACTING HOSPITALS: Hospitals that don't contract with Medi-Cal would face a rate cut of either 5% of regional contracted rates, or 90% of cost, whichever is lowest. This would provide $11.2 million in savings.

* COST AND QUALITY DATA: The budget proposes to take money from the state’s Health Data and Planning Fund, which would be used to give consumer a glimpse of providers’ prices, error rates and other key information that would help health care purchasers make informed choices. This cut saves $12 million.

Again, these cuts come on top of more than $1 billion cuts proposed in January. The governor had previously proposed higher premiums and co-pays for Healthy Families enrollees, requiring families to report changes to their income every three months in order to remain on Medi-Cal, and the elimination of essential benefits, such as adult dental care and incontinence creams and washes for aged, blind and disabled Californians.

View the fact sheet and previous reports here and here.

WHAT'S NEXT

With the latest budget figures, the Legislature can now begin making decisions and negotiating on the budget in earnest. Many decisions had been postponed -- in part because it was unclear how much money the state had to work with, and in part, because the cuts were so untenable. Next week, budget subcommittees will continue to hammer out details. Health Access will monitor the status of the health budget proposals and keep advocates informed.

For more information, contact the author of this report, Hanh Kim Quach, policy coordinator, Health Access California, at hquach@health-access.org.

Labels: Budget, Schwarzenegger, Updates

posted by Anthony Wright | Permalink | 7:03 PM


 

By The Numbers

Gov. Arnold Schwarzenegger's budget will impact tens of thousands of Californians. Here's a compilation of the cuts and lives affected:

• Quarterly-status reports: 160,000 children; 15,000 adults impacted in 2008-09. Two-year total is 300,000 children impacted. Five-year total is 471,000 impacted. Requires families to justify every three months that their income has not changed. If they fail to do so, they would be dropped from Medi-Cal.
• Elimination of essential benefits, such as dental, speech therapy, eyeglasses and optometrist services and incontinence creams and washes.

1. Dental: 900,000
2. Optometrists: 214,000
3. Eyeglasses and Contact lenses: 457,000
4. Podiatrists: 85,000
5. Incontinence creams and washes: 66,000
6. Acupuncture: 33,000
7. Hearing aids: 28,000

• Seniors and Medicare premiums: Requiring some low-income seniors (earning, at most, $1,100 a month) to pay $97-a-month co-pay on for their Medicare coverage for doctors visits. 57,000 seniors affected.
• Low-income working families: Would deem families earning very meager wages ($1,500 a month for three people) too wealthy to qualify for Medi-Cal. Such a family would need to drop its income to $895 a month -- and work no more than 100 hours a month -- in order to qualify. Numbers of people affected by this are unclear. We do know that 429,000 adults with children are on Medi-Cal now. About one-third of those are single moms.

Labels: Budget, MediCal, Schwarzenegger

posted by Hanh Kim Quach | Permalink | 5:16 PM


 

Ugly.

The Governor’s budget cuts will result in closing the doors to coverage and care for hundreds of thousands of Californians, and further unravel the broken health care system that we all rely on.

We need to remember: The new cuts that block people from getting coverage is on top of severe cuts already made this, and others still pending, that would reduce access to doctor and hospitals, eliminate basic benefits like dental care, and have people dropped from coverage. As a result, millions of Californians, including children, parents, seniors, and people with disabilities will live sicker and die younger as a direct result of these budget decisions.

THE BIGGEST CUT: The biggest of the new cuts is the "1931b" eligibility cut that would mean that a parent in a three-person family with a $11,000/year income would no longer be able to get Medi-Cal coverage. Such a cut is calculated to save $342.5 million a year in state funds, although it would also mean an equivalent loss of federal matching funds to our health system.

Developing...

Labels: Budget, Schwarzenegger

posted by Anthony Wright | Permalink | 2:01 PM


 

Closing the doors to coverage and care...

The cuts are here, and they are bad. The Governor is proposing major new cuts to health and human services.

In Medi-Cal, the major new cut is to eligibility: changing the rules so that people will no longer be able to get coverage. Our back-of-the-envelope proposal is that hundreds of thousands of people would no longer be able to get health coverage...

More soon...

Labels: Budget, Schwarzenegger

posted by Anthony Wright | Permalink | 1:13 PM


 

Bass fishing...

Tuesday, May 13, 2008

It was a moving ceremony today to install the new Speaker of the Assembly, Karen Bass.


Some common points were made in the various speeches and comments: her position is historic, as the first African-American female to lead a legislative body in the U.S.; her background in community organizing; her courage in the face of a recent tragedy of losing her daughter; and her personal interest in and advocacy for foster care children. She gave a beautiful speech as well.


Through the day, the topic that loomed was, predictably, the state budget. It's the task at hand, and one that will impact everyone in California, and every issue. And especially health care, given that health care is second only to education in its claim on the state budget.


Jon Myers at KQED Capitol Notes has an interview and asked about the future of health reform. While the new Speaker made clear that the budget was (appropriately) the first, second and third priority, she said, in reponse to Myers' questions, "I don't think it is dead at all... I absolutely want to get back to health care reform, but we have to deal with the budget first.... There will be time left in the legislative year to address health care reform.... No, I don't think it was too much bitten off.... I would very much like to tackle the whole issue."


Important signal. Shoring up the budget is an important foundation for health reform, but we have a Speaker that is willing to move forward this year and next, in order to win elements of a comprehensive reform package.


And so congratulations to Speaker Bass: she also now gets her own label on this blog, so that people can click on her below, and get most of this blog's posts related to her and health care.

Labels: Bass, Budget, YearOfReform

posted by Anthony Wright | Permalink | 10:45 PM


 

The Quiet before the Storm

There's the steady drone of doom and gloom emanating from the Capitol, but Sacramento is collectively holding its breath, waiting for Gov. Arnold Schwarzenegger to release his updated budget proposal tomorrow in what's known in Capitol parlance as the "May Revise.''

This second version of the budget comes out a month after tax day, when the state has a better idea what kind of income it has to work with the following year ....and by all accounts, it has not been pretty. Estimates of the deficit -- which started at $14.5 billion in January -- are more like $16 billion to $20 billion now.

While the entire state budget is $140 billion -- the general fund, where we have the shortfall -- is $100 billion. That means the deficit is nearly one-fifth of our budget.

Accompanying the bad figures are equally as bad rumors: Cuts, cuts and more cuts. On the flip side, precious little in new income for the state.

For most of this decade, we have grappled with multibillion dollar deficits larger than the entire budgets of many of the states in the US. And what have we done? We've borrowed and cut.

And now, we're down to the bone. Many of you may recall -- and here's a reminder -- that the governor already proposed more than $1.1 billion in health program cuts, which will mean:

• 500,000 children losing health coverage over the next five years because the state will require that their families report every three months any changes in their life.
• People with disabilities, who live on (at most) $997 a month, could develop infections and sores on their body and other sensitive areas because they lose coverage for incontinence creams and washes.
• The poorest adults will lose their dental care -- and many with already poor dental health will not treat their cavities, develop gum disease, abscesses and possibly lose their teeth.

We will all know at 1 p.m. tomorrow what the total damage will be. But this we know -- There are only three ways to cut Medi-Cal:

• Reimbursement rates for providers -- Check. That was already proposed in January and approved by the Legislature months later to go into effect July 1.
• Benefits to recipients -- Check. See a couple of the bullet points above.
• Eligibility -- Quasi - check. Requiring families to justify their income every three months is a passive aggressive way to knock people off of the Medi-Cal rolls. The state is secretly hoping that families will be too overwhelmed, their life in too much chaos, they will lose or somehow fail to complete the form and send it in. Of course, that means 500,000 children won't get health care....

By process of elimination, a direct cut to eligibility is the only thing left for the state to do to the Medi-Cal program.

Let's cry ourselves to sleep and see what's in store for us tomorrow.

Labels: Budget, MediCal, SCHIPHealthyFamilies, Schwarzenegger

posted by Hanh Kim Quach | Permalink | 6:38 PM


 

Monetary Melancholy

Monday, May 12, 2008

Gov. Arnold Schwarzenegger is expected to release his May revision of the budget on Wednesday. In January, we had a $14.5 billion hole. By all accounts, it's at least larger than $16 billion now -- and possibly approaching $20 billion.

That's bad news for all of us. (See a list of health services cuts Health Access is tracking here.) Marty Omoto at the California Disability Community Action Network does a good job of laying out what's at stake here.

And San Francisco Chronicle has a story today about the big bad picture. California Progress Report also has an analysis.

Labels: Budget, InTheNews

posted by Hanh Kim Quach | Permalink | 11:29 AM


 

The timing could not have been better...

Friday, May 09, 2008

Dr. Prem Reddy, owner of Prime Healthcare Services, is running around terrorizing 6,000 Southern California Kaiser Permanente members -- sending them enormous hospital bills (via an aggressive collection agencies) and telling them to pay up, or ruin their credit. See the story here. One patient featured is being asked to pay $50,739.70 in full by June.

The company, with 9 hospitals Southern California, is demanding payment for emergency services that are currently under dispute with Kaiser. The patients are being told they must come up with the money to pay for their treatment (the portion that Kaiser is disputing and has not agreed to pay).

The tactic being used by the hospital chain is called "balance billing,'' where patients are asked to pay the difference between what the hospital billed, and what the insurance company paid. The Schwarzenegger Administration has been working on regulations to ban this practice, and in a strongly worded notice releasing their proposed rules, accused providers -- such as hospitals and physicians -- who engage in this behavior of using "innocent enrollees'' as "bargaining chips in an unfair provider billing pattern'' that leads to "long-term harm o the enrollee's health, safety and financial stability.''

Coincidentally -- the Administration's Department of Managed Health Care will hold a hearing on this very issue in Irvine on Wednesday, the heart of Orange County where three of Prime's hospitals are located (and presumeably many of the recipients of these giant bills.)

Testimony anyone?

(Relatedly, AB1203 by Mary Salas would ban this practice.)

Labels: Affordability, BalanceBilling, Hospitals

posted by Hanh Kim Quach | Permalink | 12:56 PM


 

Rebuilding our muscle

Thursday, May 08, 2008

American manufacturers pay more than twice as much per hour for health benefits as the manufacturers in countries we regularly trade with, according to a new report by the New America Foundation that found for every $2.38 an hour paid for benefits by US manufacturers, others pay about $0.96. It's a losing proposition all around that:

1. Makes our products more expensive -- read: less competitive. (ie. an American-made car costs $1,500 more due to health costs versus $900 more by foreign competitors.
   
2. Results in American businesses trying to ratchet down what they pay in health care costs, and resulting in crappier coverage for their workers. (for more money, I might add)


3. Results in jobs going overseas -- like Ford going to Canada as reported earlier this week.
   

The report runs through a litany of interesting stats, including:

• In 1960, health benefits were only 1.2% of payroll. Now, it's more like 9.9% (averaged across all businesses, including those that *don't* provide coverage).


• Since 2000, fewer employers are offering coverage (from 69% to 60%). But for workers that *do* get coverage on the job, it's costing more -- 102% more (from $135 to $273 monthly premium).

It also acknowledges that not all costs can be shifted to workers, either in higher premiums and out-of-pocket costs or lost wages, because it would affect a business' ability to be competitive in hiring good quality employees -- something all businesses must grapple with in order to stay competitive. And that the cost of health care can't depress wages -- particularly for those already making minimum wage ($5.85 or $8 in CA), or in cases where a labor contract acts as a backstop.

Labels: Employers, International, Research

posted by Hanh Kim Quach | Permalink | 2:24 PM


 

Healthcare Armageddon

Tuesday, May 06, 2008

The New York Times had an excellent article this weekend about workers, who have health coverage through work, feeling financially strained.

The reason: businesses - unable to absorb higher health care costs - have decided that workers need to absorb more of these costs. Businesses are buying crappier coverage (this doesn't mean cheaper premiums, just cheaper than more comprehensive plans, but still expensive) and asking workers to pay a greater share of the premium. So not only are premiums for workers increasing, but the plans that they are getting are getting worse, which means higher copays, deductibles, and less coverage.

It used to be that worrying about how to pay for health care happened mostly if you didn't have insurance. Then, it started creeping into the ranks of the insured -- but only those who bought insurance on their own, without the benefit of a group buying in bulk to negotiate lower rates. Now, though, health cost worries are hitting the employer market -- where most Americans get their coverage.

One *insured* worker said he was losing the equivalent of a month's worth of pay with the higher premium and deductibles. That's in addition to the fact that the coverage isn't very good.

The Times characterized these plans as "health insurance in name only.'' I like that: essentially people are paying to be uninsured under these plans.

My health plan colleagues would argue that having some kind of coverage is better than being uninsured. No?

But is it really? At what point does debt become so crushing that it doesn't matter if the number is $60,000 or $200,000 in debt, and accruing interest. Especially considering that families that are insured, earning more than 300% of the poverty level actually have negative (-$600) net financial assets according to the latest study by Health Affairs. On an annual income of $60,000, either way, you're screwed.

Labels: Employers, InTheNews, MedicalDebt, Underinsurance

posted by Hanh Kim Quach | Permalink | 2:01 PM


 

A cuts-only budget harm knows no party...

Monday, May 05, 2008

The California Budget Project has an excellent resource on its website, showing the local impact of proposed budget cuts by county and by legislative district.

The county numbers are interesting, but you need to know the context of how big/small the counties are to begin with. (Alpine County has only 160 Medi-Cal recipients, and 2 children on Healthy Families; Los Angeles has 2.2 million on Medi-Cal, 250,000 kids on Healthy Families).

The legislative districts numbers are interesting because they are more comparable, having similar (although not the same) numbers in each district.

TOP FIVE DISTRICTS IMPACTED BY MEDI-CAL RATE CUTS: Five Senators have more than a quarter of a million constituents on Medi-Cal coverage--largely children, parents, seniors, and people with disabilities--who would lose access to key doctors and hospitals as a result of the proposed Medi-Cal provider rate cuts already adopted. These Senators would have hospitals and doctors in their districts lose over $50 million dollars in Medi-Cal funds.

These five (of 40 total) Senators are:
1) Florez (D-Fresno/Bakersfield): 306,820 on Medi-Cal; $62 million lost funding
2) Vincent (D-Los Angeles): 290, 260 on Medi-Cal; $59 million lost funding
3) Cedillo (D-Los Angeles): 278,180 on Medi-Cal; $56 million lost funding
4) Cogdill (R-Fresno/Ripon): 270,320 on Medi-Cal; $55 million lost funding
5) Ashburn (R-Bakersfield): 253,190 on Medi-Cal; $51 million lost funding

What's interesting about the list is the diversity. We have some districts from inner-city Los Angeles, but also the rural areas of the Central Valley. These districts are represented by Latino, African-American, and white legislators. And they are three Democrats and two Republicans: these budget cuts impact Republican and Democratic areas alike.

While California Republican legislators insist on a cuts-only budget, there are certainly many whose communities will be severely hurt by such a resolution to this budget crisis.

Republican Senators Denham and Runner also have lots of impacted constituents, with over 200,000 people on Medi-Cal in their districts. Of the eighteen (out of 80) Assemblymembers with more than 110,000 constituents with Medi-Cal coverage, eight are Republicans, including La Malfa, Aghazarian, Villines, Fuller, Maze, Runner, Adams, and Garcia.

TOP TEN DISTRICTS ON CHILDREN LOSING COVERAGE: So, as a result of the proposal to increase paperwork and administration burdens on Medi-Cal, here would be the top ten legislative districts that have the biggest number of children fall off coverage by 2010 and become uninsured: Florez (14,420); Vincent (14, 300); Cedillo (14,150); Calderon (11,760); Romero (11, 640); Cogdill (11,570); Ridley-Thomas (10,820); Ashburn (10,510); Padilla (10,490); Correa: (10,280). Again, a diverse crew in region, ethnicity, party, and ideology.

Unlike the other 3/4 of the Senate, these legislators each have over 10,000 children losing coverage as a result of the so-called "quarterly status reports." Sens. Denham and Battin also have high number of impacted children as well; in the Assembly, the list includes Berryhill, Aghazarian, Villines, Maze, Runner, and Garcia, who would have over 2,500 children lose coverage.

MAY REVISE AND BUDGET NEGOTIATIONS APPROACH. The California Budget Project has similar numbers for education, child care, and other programs. I haven't looked closely at those reports, but I imagine that my takeaway would still hold:

The budget crisis knows no bounds. Californians in both "red" and "blue" areas will get hit in a big way, whether cuts to schools, to child care, or to health care--where thousands and thousands of children and adults will have reduced access to doctors and hospitals, if not lose coverage altogether.

We need to come together to find an alternative to a cuts-only budget that would force such cuts.

Labels: Budget, MediCal, Research

posted by Anthony Wright | Permalink | 3:50 PM


 

Look who's moving to Canada

The Associated Press reports that the Canadian Auto Workers have signed a three-year contract with Ford. Chrysler is next.

High health care costs have been a primary source of angst for automakers, who two years ago made headlines by appealing to Washington for some kind of help. Since 2005, though, automakers' health care costs have declined by $2.1 billion. The United Auto Workers agreed to some changes, that resulted in increases costs for retirees and workers.

Salaried workers have seen premiums increase as much as 30%, out-of-pocket maximums increase by 33% to $4,000, and a tripling deductibles from $500 to $1,500.

All this -- and automakers are *still* moving to Canada.

Labels: International, InTheNews

posted by Hanh Kim Quach | Permalink | 6:01 AM


 

Who are these made for anyway?

Friday, May 02, 2008

Health Affairs has just released an excellent new study, which challenges the notion that high-deductible health plans with their low premiums are offering the otherwise a good alternative to going uninsured. Based on this research, and an updated report from the Government Accountability Office tells us who does benefit from these plans.



The Health Affairs study just confirms what advocates have been saying -- and debunks what insurance companies argue: high deductible plans are not a sound choice for families who are uninsured. One medical emergency would leave these families vulnerable to tens of thousands in medical debt, if not bankruptcy.

UPDATE: Check out Health Access' earlier report on "Thin Protections," also showing how high deductible plans provide little comfort for middle-income families that are often asset-poor.

Among the Health Affairs report's findings:

• Only 21% of households with one uninsured person could cover a $1,000, along with their other obligations.
• No more than 9 percent of households with one uninsured person could meet the out-of-pocket maximum of $5,000.

Also interesting:

$300: Uninsured families earning less than 300% of poverty ($63,600 for a family of four) had an average of $300 (!) in liquid financial assets. Incidentally, this is pretty much all they have too.

Higher income assets thin: Even for those families, who were uninsured, earning more than $63,600 -- assets were pretty scant. Gross financial assets -- which include stocks and mutual funds -- totalled $3,600 for these families. Families WITH insurance had more than four times that amount: $16,420.

So who are these high deductible plans for anyway? Well, a new GAO report tells us that:

The Government Accountability Office just updated their 2006 report on Health Savings Accounts, which can only be opened with a qualifying high-deductible health plan.

First -- only about half of the 4.5 million HSA-eligible plan enrollees opened an HSA.

And -- those who opened them have more money. The average income for the enrollees of these plans was $57,000. For those who opened an account, though, the average income was $139,000 -- more than twice as much.

I'm hoping some insurer folks or defenders of high-deductible plans can explain, again, why they still believe in light of this research that these plans are a good idea for the uninsured.

email me: hquach@health-access.org

Labels: Insurers, Research, Underinsurance

posted by Hanh Kim Quach | Permalink | 2:31 PM


 

But can Mrs. MIP get coverage?

With all the talk about the high-risk pools that McCain plans to create, it's a good thing to simply highlight that California already has a high-risk pool, even few people know about it.

It's called MRMIP, the Major Risk Medical Insurance Program.

It has a waiting list of over 500 people right now, according to a chart posted on its website. That's even though the program has never been promoted or advertised.

People who are denied coverage because of "pre-existing conditions" have to pay more than the market rate to get the coverage. It's a lifeline for those who can't get coverage any other way, but it's expensive, and has drawbacks.

The plans offered have a $75,000 overall annual cap on benefits (here's a report on the MRMIP benefit), leaving people with that coverage at risk to significant medical debt, if they happen to be sick.

There's a bill, AB2(Dymally), that Health Access California supports, to reform the program, including getting it more funding so it can provide a better benefit to more people. Its parked from last year, but without full "guaranteed issue" health reform, this issue will continue to be with us.

Labels: GuaranteedIssue, Insurers

posted by Anthony Wright | Permalink | 12:00 AM


 

More on McCain...

Thursday, May 01, 2008

There's a new May Day edition of the Health Wonk Review up at the Medical Humanities blog.

While they spotlight our post on McCain's health "plan," I want to recommend Jonathan Cohn at the New Republic for his analysis, as well as a discussion on Time.com's Curious Capitalist and Swampland, which has lots of links as well.

Basically, the nicest things I've heard about the McCain plan is it won't do any harm because it really isn't a fleshed out plan, and it doesn't have a chance in Congress. However, the majority think it's a radical shift--and not in a good way.

One debate started in Time.com's Swampland here, which quotes health policy expert Robert Blendon.

McCain's--which has some of the features of a plan proposed by George Bush in 2007, which didn't go anywhere in Congress*--actually envisions an entirely new system in which individuals would shop for their own health care coverage, presumably getting a better deal thanks to vastly more competition in the marketplace. "He proposes a vision for the future that doesn't exist -- yet," Blendon says. "His argument is I'm going to change how this thing works. ... In some sense, he has the largest scale what you would call 'reform' of all the candidates."

On the other hand, the assumption underlying the Obama and Clinton plans is the opposite, says Blendon, that "the worst thing that can happen to people is to be by themselves trying to negotiate for insurance. ... The solution is protecting people from being out there by themselves" by pooling them together, either through the workplace or in newly created purchasing cooperatives.

A commentator agrees, and succinctly lays out the three main reasons why not to shift people to the individual market:

1. Individuals have less bargaining power and sophistication than employers.
2. Negative selection.
3. Greater frictional costs from advertising to individuals, etc.

Pretty good, although they are linked. Because the individual has so little power against a big insurer, individuals usually get charged more expensive rates, and insurers profit more from the individual market. Since they lack purchasing power, they also can excluded on a case-by-case basis (as opposed to group coverage, where part of the deal is to take the entire group). And finally, the administrative and marketing costs are far more example when the company is managing and selling the plans one-at-a-time, as opposed to a group.

Individual buying coverage are simply not getting the same bang for their buck as those in the group market. Why Bush, McCain, and others would want to take coverage in that direction is beyond me.

Labels: OtherBlogs, PresidentialCandidates

posted by Anthony Wright | Permalink | 11:26 PM


 

The stars aligning again...

Wednesday, April 30, 2008

All week, we've seen signs that while health reform stalled, the need and the urgency--and the opportunity--has not.

* We have had a Field Poll showing broad support for the proposed California legislation that did stall, and even the broad provisions that any major reform is going to need to do.

* A Kaiser Family Foundation poll showed health as a major election issue this year, outpacing many other pocketbook issues--and the startling factoid, picked up by Ricardo Alonso-Zaldivar of the LA Times, that 7% of Americans said they made a decision about marriage based on the need for health coverage.

* A Robert Wood Johnson study, as reported by Lisa Girion in the Los Angeles Times, that laid out the bare facts about the rise in health care costs and the decrease in the number of jobs that now come with health benefits. Yes, the worry that the polls found is based on real trends-- people are appropriately more concerned about the status quo than the needed reforms.

* The playing field is set, the public is there, and so are many of the politicians. Governor Schwarzenegger made a strong commitment to revisit health care reform in the remaining years in his term.

The editorial board of the San Jose Mercury News may have cracked even the cynics, with their opinion piece today:

By all appearances, Gov. Arnold Schwarzenegger's plan for health care reform died an ugly death on the floor of the Legislature in January.

But as Billy Crystal's Miracle Max cracked in "The Princess Bride": "There's a big difference between mostly dead and all dead. Mostly dead is slightly alive."

Besides a great movie reference, the Mercury News also provided another key element to a new possibility: the need to get legislation passsed this year, to set the stage for 2009. We appreciate their spotlight on the Health Access California-sponsored SB1522 (Steinberg), and there are other key bills that can provide real help for people and patients as soon as possible, and lay the foundation for further reform.

It's not too late to resurrect the governor's plan. And even though it might take a miracle to reform health care in California, it's worth a shot in 2009.

That doesn't mean the subject can be ignored this year. The Legislature has work to do now to set the stage.

Next year Karen Bass will be Assembly speaker, Darrell Steinberg will lead the Senate and someone other than George Bush will be in the White House. If public support for reform remains strong, the stars will be aligned for the governor to make another run at passing his comprehensive package.

According to a Field Poll released Monday, a whopping 72 percent of voters said they gene