Archive for November, 2011

City of Amarillo Awards Hospital Contract For Employee Health Care

Wednesday, November 30th, 2011

Northwest Texas Healthcare System will provide hospital services for the City of Amarillo’s 4,500 employees and dependents for at least the next two years.


Government Health Plan To Cut Physician Pay by 27% in 33 Days

Monday, November 28th, 2011

Doctors warn that U.S. health care  will implode if government health plan cuts physician pay by 27% in the next 33 days. Many will no longer accept government health care patients, exacerbating  the shortage of access to care in this country for those reliant upon government health care.


Courageous Brownsville Doctor Rejects Humana – Will Others Follow?

Sunday, November 27th, 2011

          In today’s issue of the Brownsville Herald there appears an announcement by a local physician of his decision to no longer accept Humana Insurance patients.

The problem with this, as we see it, is the fundamental nature of the patient / physician relationship. Patients should be able to choose any physician of choice. Physicians should retain the same right in choosing and building their client base without third party interference.

A patient/physician relationship is based upon a contract. The physician agrees to provide a service and the patient agrees to pay for that service. A third party, such as an insurance policy should be irrelevant to the transaction. The insurance policy will pay what it will pay, nothing more and nothing less, irregardless of the patient/physician contract.

However, the traditional patient/physician relationship has changed with the advent of “Managed Care.” Patients and employers who sponsor group medical insurance have essentially given up their “contractural rights”  by allowing  third party intermediaries to represent them and be bound by them. Physicians, historically poor businessmen, have done the same.

Purchasing health insurance through carriers that require participation in their proprietary PPO networks such as Humana, Cigna, Blue Cross, United HealthCare and others effectively handcuffs the patient and physician to a very large degree.  The patient/physician contractual relationship is relegated to “second class citizenship” status by secretive PPO contracts that effectively rule the relationship and has “veto” power over both of the intended beneficiaries.

The good news is some employers who sponsor group health insurance and fed-up physicians are, after 25 years of failed Managed Care strategies (arranged and supported by third party intermediaries) are taking back control.

Self-funded employee welfare plans is the only vehicle available to employers who want to take back control of the patient / physician relationship. The fully-insured group medical market is not a viable option.


South Texas Employer To Drop PPO Plan – But Will They Save Money?

Saturday, November 26th, 2011

A South Texas employer group has made the decison to drop their PPO network and pay physicians  U&C. Facilities will be paid using Medicare as a benchmark.

The rationale?: Why pay PPO access fees, (disclosed and undisclosed)  when instead  you can just pay providers what they get anyway? Seems to make sense.

Editor’s Note: There are two species of medical providers – doctors and hospitals. Doctors  want to be paid fairly and promptly. Most hate PPO networks, insurance companies and other intermediaries who “manage” health care. They sign PPO contracts only because they want to be advertised as “preferred.” Doctors would like nothing better than to be left alone to practice medicine. Hospitals, are different. They consider PPO networks as their outside salesmen and partners. They dictate pricing while PPO intermediaries demand ” discounts” to justify their fees. Inflated and arbitrary pricing accomplishes both objectives.


The Best Way To Get Referrals Is to Own The Referrer – Patient Steerage On Steroids

Saturday, November 26th, 2011


The largest hospital system in Georgia, Emory Healthcare, entered into a clinical affiliation with CVS Caremark’s MinuteClinic, opening up the door to convenient care for consumers, the latter announced yesterday.


United HealthCare to Acquire XL Health

Saturday, November 26th, 2011

With ObamaCare looming, and the expected death and planned extermination of private health insurance carriers in this country  by 2014, insurance companies are positioning for continued profits by supplementing government health care programs such as Medicare and Medicaid through niche products. Transitioning strategies include acquisition of urgent care centers (Humana- Concentra), Medicare supplement business, entry into foreign markets (Aetna – China) or a  total exit from health insurance to other lines.


Health Care Strategies for Public Sector Groups

Tuesday, November 22nd, 2011


Bill:  Thought I’d share this white paper produced by GFOA and Colonial Life.  I’ve not read it yet, but the summary I read outlines a few of the things you’ve been talking about for several years now, wellness programs, onsite clinics, and developing a consumer mentality in the employees.    GFOA_2011WhitePaper_ContainingHealthCareCosts

Editor’s Note: This was sent to us by a county official in Texas. See Page 6, item #2. This is where this market is going. See also Health Care Strategies for Texas Political Subdivisions

Montana Admonishes Blue Cross – Most Favored Nations Status in Jeopardy?

Wednesday, November 16th, 2011
……. Blue Cross must notify the Justice Department and the state of Montana before it uses exclusive contracts with brokers, or exclusive or most-favored-nation provisions in its agreements with health care providers.

Is An Addiction To PPO’s A Sign of Financial Dependence? How Is Society Impacted By Addicts?

Sunday, November 13th, 2011
Ford D. Albritton, M.D. Dr. Albritton is Board Certified in Otolaryngology, Head and Neck Surgery and is a Fellow of both the American Academy of Otolaryngology, Head and Neck Surgery and the American College of Surgeons. Please Note:
*Accepted insurance plans are subject to change. However, we do accept most insurance programs.To ensure that we accept yours, please call 214.345.1400 

 Accountable Health Plans Of America Inc PPO (Interplan Health Group)
Admar PPO/Merged With Proamerica Through BCE
Aetna Medicare Advantage
Affiliated PPO
Affiliated PPO
AHI – Healthlink (Formerly Affiliated Healthcare)
Amcare HMO ( Formerly Amerihealth HMO)
BCE Emergis
Beech Street PPO/Cappcare PPO
Blue Cross Blue Shield HMO
Blue Cross Blue Shield PPO/POS
Cappcare PPO/Beech Street
Carrollton-Farmers Branch ISD PPO
CCN Managed Care Inc PPO
Centra PPO
Choice Care (Formerly Humana/Employers Health)
Choice Care Medicare Advantage PPO Network
Cigna Care Network (Specialty Care Network)
Cigna PPO
Cigna HMO
City Of Carrollton PPO
CCN Managed Care Inc PPO
Federal Reserve Bank Of Dallas
First Care HMO
First Health PPO (Formerly Affordable/Healthcare Compare)
First Health Ti PPO
Freescale (Formerly Motorola)
Galaxy Health Network PPO
Golden Rule Ins Co (Purchased By United Health Eff 9/1/04)
Greatwest Healthcare HMO (Formerly One Health)
Greatwest Healthcare One Plan (Formerly One Health)
Greatwest Healthcare POS (Formerly One Health)
Greatwest Healthcare PPO (Formerly One Health)
Healthcare Partners Of East Texas
Healthtexas Provider Network
Healthsmart/NTHN EPO/PPO
Healthsmart/NTHN GEPO
Healthsmart/NTHN POS
(HPET) Healthcare Partners Of East Texas
Humana (Choice Care)
Independent Medical Systems PPO (Formerly Integrated Medical Systems)
Intereplan Heath Group-Accountable-Interplan
Lewisville ISD PPO
Lumenos (Baylor Employees)
Managed Healthcare Inc PPO
Medical Control PPO/PPOnext PPO
Multiplan PPO
Multiplan PPO
National Healthcare Alliance PPO
North Texas Health Network (Name Changed To Healthsmart)
Pacificare HMO
Pacificare PPO
(PHCS) Private Health Care System Open Access
(PHCS) Private Health Care System PPO/Open Access
PPOnext PPO/Medical Control PPO
PPO Smartnet (Subset Of Choicecare/Humana
PPN- Premeir Provider Network
Proamerica Managed Care Inc PPO (BCE Emergis)
Pronet PPO
Randalls Food Markets PPO
Regional Healthcare Alliance PPO
Santa Fe Employees Hospital PPO
Secure Horizons Direct
Southwest Preferred Network (Alliance Health) PPO
Texas Health Choice HMO (Kaiser Permanente)
Texas Instruments (Ti) PPO
Texas Medical Resource PPO
Texas Municipal League PPO (TML)
Texas True Choice
Texas True Choice Star PPO
TRS-Care (Texas Public School Retired Employees)
TRS-Active Care PPO (Texas Public School Active Employees)
Unicare Classic PPO/Preferred
Unicare Performance
United Health Care Choice Plus & Select Plus POS
United Health Care Choice & Select HMO
United Health Care Options PPO
USA Managed Care Organization
USC Health Services PPO
Texas Institute For Surgery
DPS Renewal
Beech Street Workers’ Compensation New Contract Amendment
Interplan Health Group Workers’ Compensation (Formerly Identified As Accountable) New Contract Amendment
Medical Savings Plans (Through Galaxy) New Contract Amendement

Holy Smoke! How does this guy know what he is going to get paid? Smith with Blue Cross pays him $10 while Jones with Cigna pays him $11 for the same service. Then in comes Garcia with TTC who pays him $13.22 for the same service that Jones recieved. Yabolonski comes in with UHC and pays $9.53 for the same service Garcia received……………….

Then in comes Don Pedro with cash…………….and pays $3.50

Editor’s Note: If we  remove  the addiction (health care intermediaries such as the ones listed above) we can reduce health care costs by more than 40%. A San Antonio employer did  – Bill Miller Forbes.

From The Desk Of Molly Mulebriar:

 Bill, let me see if I understand this post. Ford has contracted with every PPO in the world, “discounting” his fees for service in return for patient steerage to his facility. That is the premise behind PPO’s – doctor charges less so that his name can appear in a PPO directory. So, since he has signed up with every PPO out there, practically every patient he sees he will have to discount his fees which means he will almost never get to charge his full normal fees. Seems to me to be a hell of an expensive advertising campaign, having your name in all those PPO directories. An unscrupulous doctor would inflate his normal fees, then agree to a discount down to his original normal fee giving the illusion of savings.


Medicare/DRG Based Pricing – The Future Of Cost Containment

Thursday, November 10th, 2011

Payments based on PPO discounts and negotiations/repricing based on provider charges are becoming increasingly ineffective cost containment solutions due to escalating healthcare provider charges. Recognizing this, many large insurers are already utilizing Medicare/DRG Based Repricing for reimbursement of some of their clients’ claims.


Want To Save On PPO Access Fees Without Materially Affecting Claim Costs?

Wednesday, November 9th, 2011

Self-funded group medical plans rely on PPO network agreements to save money on claims. To access  purported network savings, the Plan Sponsor pays a PPO management fee, or access fee, usually around $4-5 pepm, or more. Recently, third party administrators and carriers are beginning to bump those fees higher, as high as $12.50 pepm in some cases.

So, what does a self-funded group medical plan really get, overall, in the way of claim savings by utilizing a PPO network? For the privilage of paying a management fee, they get “discounts” off billed charges. And, the discounts appear to be significant.

There is a good reason for that – bill high, give a whopping discount, and still bill high. Seems to make everyone happy. “Boy, did I get a good deal! The doctor charged $750 and my PPO network repriced it down to $200! I saved $550!”

Or, “my hospital bill was $87,000, but ABC Insurance Company repriced it down to $54,300! Thank you insurance company!”

So, why pay a PPO management fee when you can simply pay providers what they get anyway?

Here is a redacted email we sent this morning to a third party administrator:

XXXXXXX does not want to pay the increased PPO access fee. Instead, they are considering dropping the PPO network and pay physician U&C at the 90th percentile, and pay hospitals cash at 65% of billed charges. The end result, based on emperical data specific to this case, as far as claim dollars expended would be no worse, or better, than paying $18,225 in annual PPO access fees for the privilage of paying about the same in real claim dollars.

Common Sense tells us that physicians will take U&C at the 90th percentile all day long and hospitals will take 65% of billed charges all day long too. XXXXXXX still ends up paying more than they should (no more than they would if they continued with the PPO contract), but at least they save the ridiculous PPO management fees of $18,225.

Editor’s Note: Common sense is defined by Merriam-Webster as, “sound and prudent judgement based on a simple perception of the situation or facts.”[

Good post. I am seeing more and more of this in the market.  I have several groups that have dropped their PPO network and are paying U&C on the physician side and paying hospitals Medicare +25%.  We almost never see any balance billing issues on the physician side, and less than 20% of our hospital claims are balanced billed to the patient. When that happens we negotiate within certain parameters and the balance billing issue goes away. 



Senate To Probe Aetna, Cigna, United Health Care for Fraud

Wednesday, November 9th, 2011

“The insurance companies allegedly encouraged in-network physicians to send their patients’ lab tests to a specific testing company. Known as a pull-through scheme………………………”


Hospital Pricing Revealed – What Hospitals Do Not Want You To Know

Sunday, November 6th, 2011


“Most hospitals will tell you that Medicare pays too little causing the hospital to lose money on Medicare patients.That is not true.

The law requires Medicare to pay on average 1% more than cost at an efficient hospital.

What Medicare pays should be a starting point in determining a reasonable charge for you.

In the deal the Minnesota Attorney General made with the seven-hospital Fairview Health Services, the hospitals would be required to charge self-pay patients no more than 5% above Medicare or Medicaid rates, whichever is greater.If you follow the guidelines set by the Minnesota Attorney General, you would be paying your hospital Medicare plus 5%.”

“We believe in general you should pay no more than Medicare plus 25%. That is a generous payment from you. Minnesota has required hospitals accept Medicare plus 5%. We suggest you offer Medicare plus 25%. “

Editor’s Note: Here is a sample page of the above mentioned website:


Well said.
An argument I have been using of late is relative to a hospital’s payer mix.  As you probably know, payer mix is an internal term at a hospital. It segregates where their money comes from by percentage and what they pay.  
An average hospital has a payer mix that looks something like this:
Medicaid:  15%
Medicare:  38%
Blue Cross: 30% (more in many markets) and where more almost always with favored nations contracts
Sub Total    83%
Medicaid pays poorly, Mediare pays very well, and the average BC/BS pays anywhere from 10% to 25% greater than Medicare
United, Aetna, Cigna, Humana, etc then pay a few points higher then BC/BS on average.
Then comes the rental networks and non-Bucas.  This group pays in at least the 95th percentile of a hospital’s payer mix.  There is no way a hospital can defend balance billing a patient for more money when they are paying at such a hefty level of their payer mix.
PS   Many rural hospitals have a payer mix of 85% Government pay (Medicaid + Medicare)
Good stuff Bill. The environment is ripe for a transparent priced, competitive marketplace for providers. Just need to keep the pressure on in revealing the indefensible model now in place.

New Texas Laws Fix Loopholes After Retaliation Against Two Nurses

Wednesday, November 2nd, 2011

                 This is a story about how two Texas nurses turned the tables on a hospital administrator, a county sheriff and and a county attorney.


Castlight Health – Reference Based Pricing

Tuesday, November 1st, 2011

Whatever happens to ObamaCare, a company such as Castlight has the potential to disrupt the way health care is consumed in the U.S. ……………….Castlight is also introducing to its self-insured clients so-called reference-based pricing, which allows employers—as opposed to the insurance companies, to cap the amount they pay for procedures based on those price variations.

Brownsville Independent School District VS HealthSmart

Tuesday, November 1st, 2011

BISD considers change in representation – 

Editor’s Note: On one hand, we would like to see the lawsuit move forward, all the way to a jury trial, if for no other reason than to expose the inner workings of the insurance brokerage world, and the secretive world of PPO contracts. 

However, special interests on both sides of this lawsuit cannot afford this public scrutiny and we believe will settle this case rather than give the public a once in a lifetime view of the sordid  financial business we know as our health care delivery system.

If this case moves forward and the discovery process runs it’s course before a settlement is made, Molly Mulebriar ( promises to report the highlights of facts recorded during the process. To date, a recent trip to the Cameron County Courthouse shows little activity in that regard.

On the other hand, we believe this lawsuit is politically motivated and a waste of taxpayer money. In reading he pleadings, we find errors of facts as we know them, easily addressed by defense attorneys. We are confident a jury will reach the right judgement/s if this case goes that far. But, as appears to be  the norm in our legal system, sometimes it is less expensive to settle a case than to pay lawyers over a protracted period of time. In our litigious society, you can sue a Ham Sandwich and win (settle) every time.