CMS Releases Major Overhaul of Medicaid Managed Care Regs

CMS last week released its first major update to Medicaid and CHIP managed care regulations in over a decade with a proposed rule that aims to align Medicaid managed care with Medicare Advantage and private market policies, bolster state delivery reforms, impose new quality ratings, set up best practices, and bring CHIP managed care in line with the proposed changes. CMS proposes to add new requirements for medical loss ratios for managed care plans, implement best practices identified in existing managed long-term care services and support programs, require states to develop a Medicaid managed care quality rating system for health plans, and permit managed care flexibility for enrollees aged 21 to 64 in short-term inpatient or sub-acute institutions for mental disease. Click here for a CMS summary. Click here for the 650-page regulatory proposal.

  • Since most of Medicaid is now outsourced to private companies like Centene, Aetna and UnitedHealthCare, CMS believes there is good reason to update the regs. Click here for the report.
  • One thing is certain, health plans are unhappy about the requirement that imposes a Medical Loss Ration on Medicaid plans. Click here.
  • In a report released last week, the GAO found thousands of Medicaid beneficiaries and hundreds of providers involved in potential improper or fraudulent payments during FY2011—the most-recent year for which reliable data were available in four selected states: Arizona, Florida, Michigan, and New Jersey. GAO said further actions are needed to curtail the fraud. Click here for their report.
  • A House subcommittee is holding a hearing this week on Medicaid fraud. Click here for details.


Hospital Productivity Growing Faster than Medicare Payments: Study

A new study published in Health Affairs found that hospitals’ productivity has grown more rapidly in recent years than in prior ones. Hospitals are providing better care at a faster rate than growth in the payments they receive from Medicare, according to the study. Click here for the news report. Click here for the study.


Blue Cross Facing Serious Antitrust Lawsuits

Blue Cross and Blue Shield insurance companies as well as the Blue Cross Blue Shield Association face antitrust lawsuits alleging that the 37 independently owned insurers act as an illegal cartel, the Wall Street Journal reported last week. The claims–which have been consolidated into two lawsuits–are gaining traction in a federal court in Alabama. One lawsuit represents healthcare providers, the other individual and small-employer customers. Click here. (It includes a state-by-state map showing BCBS market share.)


10 Health Care Bills Moving Through Ways and Means Committee This Week

The GOP-led Congress appears to be on the move again with health care policy changes as the Ways and Means Committee prepares to pass as many as 10 bills this week. Two of the bills have already passed the Senate. Click here for a very good 3-page summary of all the bills likely to gain committee approval Tuesday.


Pay-for-Value Coming to Rx?

Express Scripts Holding Co., a large manager of prescription-drug benefits for U.S. employers and insurers, is seeking deals with pharmaceutical companies that would set pricing for some cancer drugs based on how well they work, according to reports last week. The effort is part of a growing push for so-called pay-for-performance deals amid complaints about the rising price of medications, some of which cost more than $100,000 per patient a year. Click here.


Accusations Grow Against Health IT Companies for Blocking Information Exchange, Locking In Customers

The federal government has poured more than $29 billion into health information technology and told doctors and hospitals to use electronic medical records or face financial penalties. But some tech companies, hospitals and laboratories are intentionally blocking the electronic exchange of health information because they fear that they will lose business if they share information on patients with competing providers, administration officials said. In addition, officials said, some sellers of health information technology try to “lock in” customers by making it difficult for them to switch to competing vendors. Click here for the NYTimes report.


Actuaries Say GOP Contingencies for Supreme Court Ruling on Obamacare Fall Short

Many of the contingency plans that Republican members of Congress are gearing up to push if the Supreme Court pulls subsidies from federal exchanges would severely disrupt the insurance market by causing adverse selection and increased premiums, the American Academy of Actuaries warns in a policy brief out last week. Even a temporary extension of the subsidies under the GOP plans would likely just delay the inevitable market destruction. Click here for their report.

  • A Supreme Court ruling due in a few weeks could wipe out health insurance for millions of people covered by President Barack Obama’s health care law. But it’s Republicans – not White House officials – who have been talking about damage control. A likely reason: 26 of the 34 states that would be most affected by the ruling have Republican governors, and 22 of the 24 GOP Senate seats up in 2016 are in those states. Click here for the AP story.
  • The politics of this court decision could cut either way, argues this report.


Major Health System Announces New National Minimum Wage

Ascension, the nation’s largest Catholic and non-profit health system, last week announced plans to implement a new national minimum wage for its employees across the country. The new Socially Just Minimum Wage, $11 an hour, will be effective with the pay period beginning July 5, 2015. Approximately 7 percent of more than 150,000 employees across Ascension’s more than 1,900 sites of care in 23 states and Washington, D.C., will be directly helped in some way. Click here for the announcement.


Humana May Be Sold

Health insurer Humana Inc. is exploring a possible sale of the company, a move that could trigger a round of mergers in an industry grappling with challenges and opportunities the federal health-care overhaul has created. Faced with pressure to cut costs and find ways to profit from the potential new customers the Affordable Care Act is generating, the big health insurers have long been expected by analysts to turn to mergers that will give them the heft to better compete as the industry evolves. Click here for the WSJ story.

  • A new study out last week estimates that overhead costs for health plans will increase by $270 billion over the next decade. Click here for the report in Health Affairs.


Court Rules on Highmark, UPMC Medicare Advantage Battle

The Commonwealth Court of Pennsylvania ruled last week that Highmark Medicare Advantage beneficiaries will be able to keep in-network access to University of Pittsburgh Medical Center providers. The commercial contracts between Highmark and UPMC ended at the end of last year, putting tens of thousands of people at risk of having their care at UPMC facilities be billed as out of network. And last month, UPMC announced that it would move to cut off Highmark’s MA contract, which threatened to disrupt care for about 180,000 seniors. Click here for the 3-page court decision.


Federal Prosecutors Targeting C-Suite in Fraud Enforcement: DOJ

Federal prosecutors are moving fraud enforcement into the C-suite, according to remarks made by Assistant Attorney General Leslie R. Caldwell during a speech delivered at the American Bar Association’s 25th Annual National Institute on Health Care Fraud last week. Just as the Department of Justice has pursued charges against executives for financial fraud, healthcare executives will be held accountable for fraud schemes that occur under their watch, he said. Click here to read his speech.


CMS Launches New Efforts Against Heart Disease, $112 Million Awarded

CMS announced a new program last week that seeks to enroll 300,000 patients and more than 700 physician practices in an effort to dramatically reduce cardiovascular disease. Currently, providers are paid to meet specific blood pressure, cholesterol or other targets for their patients as a group. In a new approach, the Million Hearts® model will use a data-driven, widely accepted predictive modeling approach to generate personalized risk scores and modification plans for patients. Click here for details.

  • In a related development, CMS announced last week awards of $112 million to regional cooperatives to work with about 5,000 primary care professionals in 12 states to improve the heart health of their nearly 8 million patients. Click here.


Chronic Disease Management Now Standard Fare for Health Plans

Programs to help patients manage chronic diseases such as diabetes and asthma appear to have become a standard component of health plans, according to a new RAND Corporation study. The number of people in the United States with one or more chronic conditions is expected to grow to 171 million by 2030. Click here for the study.


New Hope for Cancer Patients; Providers Concerned About Growing Costs

A new drug that unleashes the body’s immune system to attack tumors can prolong the lives of people with the most common form of lung cancer, doctors reported late last week, the latest example of the significant results being achieved by this new class of medicines. In a separate study, researchers said they had found that a particular genetic signature in the tumor can help predict which patients could benefit from the immune-boosting drugs. Click here for this encouraging report from the NY Times.

  • Providers can no longer ignore the skyrocketing costs of cancer treatments and the financial burden it creates for their patients, according to reports last week. The rising costs are due to more expensive drugs–some immunity system-based therapies can cost $150,000 a year–and higher co-payments and deductibles for patients. Click here for the story.


FBI Investigating Providers on Use of Device Used in GYN Surgery

The FBI has launched an investigation to determine whether medical device makers, doctors and hospitals failed to report deficiencies with a power tool used during gynecological surgery. Click here for the report in the NYTimes.


Obesity Epidemic Worsens in U.S.

America’s obesity epidemic is getting worse and it appears to be tied up with a poorer overall sense of well-being, according to reports last week. The obesity rate rose last year, to 27.7 percent, according to a Gallup and Healthways survey of more than 175,000 Americans nationwide. That rate is 2.2 points higher than where it was in 2008, when the survey was launched, with higher rates associated with lower well-being scores overall. Click here for the sobering report.


Hospitals Using New, Advanced Monitoring Systems for Patients

Hospitals are trying new early-warning systems to monitor patients for subtle but dangerous signs of a worsening condition. Among the strategies hospitals are adopting is a wireless monitor that slips under a mattress and alerts nurses to changes in breathing and heart rate. Another approach rates a patient’s risk of serious deterioration in real time based on lab results, vital signs and nurses’ assessments gathered from electronic medical records. Click here for the story.


Columnist Says Doctors Have Become Data Entry Specialists

A leading conservative columnist, Charles Krauthammer, was out last week with a column about why doctors are quitting the profession – because they have gone from patient care to data entry specialists. Click here.


Health Care Now Number One Employer in Most Counties

Health care is now the number one employer in most counties in the United States, according to data from the Census Bureau. Click here for an interactive map of all the U.S. counties and how they compare from an employment perspective.