Month: January 2012

http://www.bloomberg.com/news/2012-01-26/humana-s-mccallister-says-he-s-open-to-billion-dollar-deals-in-medicare.html

http://docs4patientcare.org/prescription

http://hr.bisd.us/Jobs/Jobpost.exe

Editor’s Note: Brownsville Independent School District is the largest employer south of San Antonio. This position is newly created. It provides an opportunity for the right person to institute risk management policy and protocol in the formation of a first class risk management department equal to the best in the state. The Cypress Fairbanks Risk Management Department and the Mesquite Risk Management Department  (http://www.mesquiteisd.org/departments/risk/index.asp) are good examples of what can be done when a qualified in-house risk manager looks after, manages and controls risk for taxpayer supported political subdivisions in this state.

http://www.primacentral.org/content.cfm?sectionid=76

Cost Plus medical reimbursement for self-funded employer sponsored health plans in Texas is a concept developed by Group & Pension Administrators (GPA) several years ago. Looking after their client’s financial interests, GPA developed a program based on the concept that health care cost needed to be addressed at the provider level on a transparent basis.

By removing  third party intermediaries who historically have negotiated  proprietary (and secret) reimbursement fee schedules in partnership with medical providers based on discounts off arbitrary and inflated fees, GPA has successfully reduced their client’s medical costs by 40% or more. With credible impirical data acquired through over 4 years of experience on their Cost Plus client base, the numbers are impressive.

We wrote Jeff McPeters, owner of GPA  for an update and future prospects of  Cost Plus. Below is his response:

Bill, we expect 2012 to  be even bigger for the  Cost Plus concept.   The number of employers who have elected Cost Plus is growing steadily and  as employers continue to struggle with  health care cost  increases, Cost Plus is taking off faster than we expected.   Cost Plus is gaining more and more attention by brokers who are committed to provide their clients with a  viable alternative to the status quo and inefficient  traditional  approaches with their  related 8% to 20%  annual rate increases.   Cost Plus  stands up very well  to products that attempt to compete,  with one  powerful benefit being  new Cost Plus clients realizing  up  to 50%  savings on claims compared to their prior year.

With the traction already experienced, Cost Plus is growing at an exponential rate.   Going into our 5^th year we have continued to improve the Cost Plus  concept to make it more  efficient for the employers.  We have also arranged for direct contracts with several hospitals to allow Cost Plus client’s employees access at very favorable rates.  The consensus form clients under cost plus is that they will never go back to the traditional PPO model. 

Editor’s Note: Jeff McPeters can be reached at jeffm@gpatpa.com

It started in Texas with Cost Plus. Smart employers, realizing that PPO “discounts” came with a hefty price, moved away from managed care contracts and instead paid providers a transparent, fair and reasonable fee for services.

Acceptance of the concept is growing. Cost Plus continues to expand it’s market share. Copy-cat competitors are entering the market, with variations to the concept.

Enter Allied Brokerage Services. Today they announced a new fully insured health plan available to small Texas employers. “Your clients will still receive the value of PPO-like discounts with protection from balance billing for all medical services………………employees can go to any provider of choice………..there are no preferred providers or networks required……………..? 

http://www.allied-brokerage.com/component/content/article/39-groupmm/147-PF

No PPO Network and No Balance Billing?   – http://www.alliednational.com/pdfs/823_pf_brochure_flyer.pdf

“ONCE WE RID OURSELVES OF TRADITIONAL THINKING WE CAN GET ON WITH THE FUTURE” – James Bertrand

Insurance coverage can be a confusing thing.  Coverage for employee benefit plan fiduciaries sometimes adds a wrinkle to the process that can be overlooked.  Depending on the type of claim asserted, there are a variety of “coverage” options that may apply.  I think the new fee disclosure rules are likely to increase claims for breach of fiduciary duty in the future, but even without that development, it makes sense to at least know whether you have coverage and what your options are.  So let’s take a look at some of the options.

• The ERISA Bond.  Generally, plan’s have to have an ERISA bond that applies to anyone who handles plan assets.  The presumption is that handling the assets equates to “discretionary authority” which is the hallmark of fiduciary status.  The bond can be very narrow (covering only fiduciaries and employees) or broad (extending to vendors and person who do not necessarily handle plan assets), but the bond will only provide protection for claims for “fraud and dishonesty.”  It does not generally provide insurance coverage for other claims, particularly claims for breach of fiduciary duty not involving fraud or dishonesty.
• Fiduciary Liability Insurance.  Unlike a bond, Fiduciary Liability coverage pays for claims arising out of the administration of a benefit plan without requiring “fraud” or “dishonesty.”  Often it is combined with Employee Benefits Liability Coverage.  This type of coverage is designed to insure fiduciaries acting specifically in their capacity as benefit plan fiduciaries which include claims for breach of duty or mistake in administration of the plan.  Some policies can even be expanded to include coverage for penalties and fines (for a price). 
• Directors and Officers Liability Insurance. D&O policies generally provider coverage for directors and officers of a company in the event they are sued in conjunction with the performance of their official duties as they relate to the company.  But many D&O policies exclude claims arising from administration of benefit plans.  Others require a specific rider that includes employee benefits coverage (likely for an additional premium).  Don’t assume that because you have a D&O policy that it automatically provides coverage for claims arising from plan administration. 
• Errors and Omissions Insurance. E&O polices rarely provide coverage for ERISA claims (unless the company with the coverage happens to be in the business of providing service to ERISA plans).  Unless specifically included in an E&O policy, this coverage will not likely protect a fiduciary from a claim arising from administration of a benefit plan.
• Employment Practices Liability Insurance.  EPLI coverage is typically bundled with D&O coverage and generally insures against claims that allege misconduct by the officers of a company in an employment setting.  These claims are typically for things like harassment, discrimination and wrongful discharge.  EPLI coverage does not typically provide protection against claims arising from plan administration unless specifically included (usually with a rider and usually for an extra premium).

Why be concerned?  Frequently I find myself in a position of defending a fiduciary (or an officer or owner of a company alleged to be a fiduciary) who finds him or herself in a position of being “uninsured.”  They assume that their general commercial liability policy or D&O policy covers them for ERISA claims, only to find out the carrier has denied coverage.  Depending on the nature of the claim, the size of the claim or the breach alleged, ERISA claims can be very expensive to defend and can result in some hefty damages. 

Of course, insurance is not free and balancing the cost of coverage versus the risk of exposure is a business decision that plan sponsors and fiduciaries have to evaluate on their own.  I certainly recommend that anyone in a fiduciary position have coverage, but it is not required.  However, I do think it is very important for you to check to see if you do or do not have coverage for employee benefit claims.  Look at your policies to see whether or not you have coverage.  If you don’t have coverage, maybe you should look at the cost of adding it.  But better to know now whether or not you do than to be surprised later to find out you don’t.  And ask if you are not sure.

Keith McMurdy – kmcmurdy@foxrothschild..com

Walgreens is apparently planning to sell health insurance with different price points and coverage levels through a private insurance exchange this fall. Should existing, well-established insurers be concerned? 

Continue reading Walgreens To Sell Health Insurance?

Can a third party administrator force a client ,who is subject to ERISA , to purchase a product as a condition to administer claims or renew an existing Administrative Services Agreement, a product for which the TPA receives renumeration from or has ownership interest?

Some businesses  force the sale of a tie-in product in order for the consumer to buy the main product. For instance, a car maker may force a buyer to have the battery or other product from a company they own or influence, and thus get an additional profit center.

Under ERISA, that kind of tie-in is a whole category of “prohibited transaction” known as “self-dealing”, and can land you in jail. It is all for the protection of plan participants and to be sure that plan assets are used in the most prudent way in every transaction.

If a TPA, for example,  requires the use of an audit firm from which they receive a kickback instead of another audit firm equally qualified yet less expensive,  would this be an ERISA violation?

A self funded health plan is composed of many moving parts.  Unbundling services to get the best value is unquestionably an important duty required of fiduciaries.  In reality, however, many self funded employers rely on their TPA to subcontract services while never questioning cost components individually to any significant degree.

On Tuesday, Walmart spokeswoman Tara Raddohl confirmed the proposal but declined to elaborate on specifics, calling it simply an effort to determine “strategic next steps.” The 14-page request asks firms to spell out their expertise in a wide variety of areas, including managing and monitoring patients with chronic, costly health conditions. 

Continue reading Request For Proposals: Walmart Seeking Partner/s – Wants To Be The Nation’s Biggest Primary Care Provider

Operation Poisoned Pawns continues to unfold. In Chess, the Poisoned Pawn Variation is any of several chess opening variations where a pawn is said to be “poisoned” because its capture can result in positional problems or material loss for the captor.

Continue reading Former President of Access Administrators Faces April Public Corruption Trial

WASHINGTON — Two weeks before Thanksgiving in 2003, top officials from Texas Governor Rick Perry’s office pitched an unusual offer to the state’s retired teachers: Let’s get into the death business.

http://www.huffingtonpost.com/2011/08/25/rick-perry-texas-life-insurance-scheme_n_935666.html

Harrison County in East Texas , like many other political subdivisions within the state, is facing rising health care costs associated with their self funded employee medical plan. Claims and expenses last year exceeded budget by over $1 million. Commissioners Court had to act to reign in costs.

Their solution? Pass more costs on to the plan participants in the form of reduced benefits.

Unfortunately, this strategy does not save money at all. It only changes who will pay what portion of a claim and who will pay the remaining portion. It has no effect whatsoever in contolling health care costs.

Refugio County faced the same problem several months ago. They decided to pass all health care costs on to their employees by dropping the county’s health care plan entirely.

Is there a better way to control health care costs and maintain good benefits for employees. The answer is yes. The solution is obvious.

Health Care Strategies for Texas Political Subdivisions                           Managed Care Under Siege

ABC News’ Ben Waldron reports:

A Bronx man says he nearly had an asthma attack after opening his mail to find a $44 million medical bill from a local hospital.

Unemployed doorman Alexis Rodriguez, 28, received the astronomical bill after receiving successful treatment for pneumonia at Bronx-Lebanon Hospital last week, The New York Daily News reports.

“I almost had an asthma attack,” said Rodriguez, who apparently is not the only patient to receive an outsized bill. The firm responsible for the botched billing, PHY Services, was reportedly inundated with complaints and has since apologized.

“If you are calling with respect the billing statement for services provided at Bronx-Lebanon Hospital, please disregard the statement,” said a recording for concerned callers, “you will be receiving a new statement shortly.”

PHY is blaming the mistake on a “system error” that resulted in the bill’s invoice number being mistakenly placed in the “amount due” field.

As for Rodriguez, he owes no more than $300 for outpatient services.

Editor’s Note: Obviously Mr. Rodriquez does not belong to a PPO plan.

A recent article  in Busuness Insurance gained our immediate interest. The lead sentence seems at odds with what insurance companies are telling consumers:

“Government researchers and private experts say the weak economy, the rapid rise of generic drugs and lower-cost treatment alternatives are major reasons why total U.S. health care spending increased a modest 3.9% “

Recent group insurance renewals we have reviewed use trend factors averaging 11%. So if medical inflation is really only 3.9%, why are insurance companies using a rate that three times higher?

Continue reading Is Medical Trend 11% Or Is It Really 3.9%?

If the rumor is true about Bluebell Ice Cream’s “e-claim-only” dental benefit plan that is to go into effect in March, how many in the east-central Texas town of Brenham (pop. 16,000) will be properly warned about the danger to themselves, their families and Bluebell officials’ reputations because of reckless policy?

 Each time their dentists send an electronic dental claim (e-claim) over the internet to insurance employees in Chicago as a favor to a patient – and especially the insurer – the Bluebell employee’s digital medical identity which is worth fifty bucks on the black market, rides along to destinations unknown. It’s my guess that very few Bluebell employees are yet aware of the increasing risk of medical identity theft from dentists’ e-claims – much less given the opportunity to opt out of the risk by simply visiting a dentist who still uses the telephone, fax and US Mail.

 It certainly won’t improve my popularity with 9 out of 10 dentists for saying this, but risks of identity theft from HIPAA-covered dental offices are climbing daily. In the introduction to a recent interview with Larry Ponemon, chairman and founder of the Ponemon Institute, GovernmentIT.com editor Tom Sullivan ominously described the ever-increasing risk of a massive “data spill” of perhaps millions of patients’ protected health information (PHI):

 “The street value of health information is 50 times greater than that of other data types. Even worse, the healthcare industry is among the weakest at protecting such information. With organized criminals trying to steal medical IDs, sloppy mistakes becoming more commonplace, mobile devices serving as single sign-on gateways to records and even bioterrorism now a factor, healthcare is ripe for some a wake-up call – one that just might come in the form a damaging ‘data spill.’” (See: “Q&A: How a health ‘data spill’ could be more damaging than what BP did to the Gulf,” December 05, 2011, by Tom Sullivan, Editor)

http://govhealthit.com/news/qa-how-health-data-spill-could-be-worse-what-bp-did-gulf?page=0,0

 According to Dr. Ponemon: “The basic issue, when you think about data theft not data loss – because it’s hard to know whether that lost data ultimately ends up in the hands of the cybercriminal and all of these bad things occur – but in the case of identity theft, the end goal has been historically to steal a person’s identity, and just like getting a financial record, getting a health record probably has your credit card, debit card, and payment information contained in that record.” But that’s not all. Credit cards are just chump change.

 He continues: “The financial records are actually lucrative for the bad guy, but the health record is actually much, much more valuable item because it not only gives you the financial information but it also contains the health credential, and it’s very hard to detect a medical identity theft. What we’ve found in our studies is that medical identity theft is likely to be on the rise and, of course, there’s an awareness within the healthcare organizations that participate in our study that they’re starting to see this as more of a medical identity theft crime. It’s not just about stealing credit cards and buying goodies, it’s about stealing who you are, possibly getting medical treatment and, therefore, messing up your medical record.”

 Dr. Ponemon suggests that the victim may not know about the theft until he or she “stumbles on something that alerts them their medical identity was stolen.” Perhaps something like death following anaphylactic shock from a medication that was once digitally highlighted as “Allergic to.” Understandably, Ponemon adds that respondents recognized altered medical histories as an emerging threat they believed was affecting the patients in their organizations. Such danger for dental patients is almost non-existent if their dentists simply don’t put PHI on office computers.

 Should a data breach of Bluebell Ice Cream employees’ identities occur in Brenham or Chicago, which is more likely than not, the fact that electronic dental records do nothing to improve the quality of dental care won’t make Brenham citizens any happier with local Bluebell officials.

 D. Kellus Pruitt DDS

“We wonder why US healthcare costs are so much more expensive than the rest of the industrialized world without significantly better outcomes.  It isn’t because physicians are grossly overpaid, as some would like the public to believe. It’s because too many hands are in the cookie jar, separating patients from their physicians.  The US healthcare system has negligently inserted strangers and institutionalized bureaucracy into the decision-making process for individual health care needs. ”

http://par8o.com/wordpress/

Blue Cross, originally named State Bonding Corporation and Insurance, Co., Inc. was founded in 1949. In 1977, State Bonding established a medical insurance division to respond to the growing health insurance market. It was in 1986 that the company changed its corporate name to Blue Cross Insurance, Inc. In 1996, Blue Cross ceased writing general insurance business to concentrate on its specialized lines of medical, personal accident and travel insurance.

Belonging to the top 20 non-life insurance companies in the country, Blue Cross is one of the most financially stable companies in the market today. We have a current premium revenue of around 380 million Pesos per year, and assets amounting to around 520 million Pesos. With a steadfast commitment to growth and progress, Blue Cross aims to surpass these figures in the years to come.

For more information, visit www.bluecross.com.ph

Molly Mulebriar reports that the BISD Board of Trustees will hear the results of a forensic audit next week ( www.mollymulebriar.org ).

Will the audit address insurance issues related to the $55 million employee health insurance program? Smart money places  the odds at three to one.

“A relatively little-known provision in the law creates an affordable new choice for individuals and businesses by allowing flat-fee direct primary care practices to compete within the state-based insurance exchanges……………”

Continue reading Direct Primary Care Model Can Lower Costs by 40% Or More

Many believe that the recent passage of ObamaCare is about solving the high cost of health care in this country. But it seems it is much more far reaching than that. http://www.youtube.com/watch_popup?v=HcBaSP31Be8&vg=medium

Bill this doesn’t correlate with the act that actually passed…this was the first one that didn’t pass. I attached actual HR3590.

Another tax imposed by Democrats will drive more American jobs overseas. It is estimated 45,000 Americans will lose their jobs due to this new tax, with business moving to Costa Rica and other more friendly business environments around the world. With massive corporate taxes the highest in the world, is it no wonder American manufacturers are fleeing oppressive taxation.

Continue reading Tongue Depressor Tax Will Harm Jobs – Manufacturers Flee to Costa Rica

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