Molly Mulebriar Org. looking for assistance on single case project – http://mollymulebriar.org/report/
Archive for August, 2011
In the insurance brokerage business, an introduction can be worth thousands, and even millions of dollars, costing the recipient the same amount.
“Let me put you in touch with ABC Insurance Company. They have a great product you can use in your brokerage. I already told them that you would be calling” chortled John Brown, local insurance guru in Buffalo Breath, Montana.
What happened is John has “covered his base” by cutting a deal with ABC Insurance Company prior to making the introduction. “Hey Bruce, this is John. I’ve got an insurance agent down in Little Rabbit, Arkansas that I can send your way. Has a big case that I think he can place with you. I need a cut of the commission, ok?”
“Sure John, we will put him under you in our system and for the rest of his life, on all sales he makes with us, you will get a cut of the commissions. He will never know what you are making. What is his name so I can log him in?””
“Great, but what if this guy tries to go around me and cut me out?”
“No problem, we will protect you.”
John now has an annuity. From that point on, on every sale his referral generates, John will be paid. Life is good.
Editor’s Note: If you need a PBM that offers a completely transparent, pass-through contract, that will save your client big bucks guaranteed, contact us during regular business hours.
A federal judge has denied a request from Blue Cross Blue Shield of Michigan to dismiss a suit filed by federal and state governments, alleging the payor’s use of certain hospital contracts stifles competition, according to a Detroit News report.
In a court hearing, U.S. District Judge Denise Page Hood said she would produce a written order denying BCBS’ request, allowing the lawsuit by the U.S. Justice Department and former Michigan Attorney General Mike Cox to proceed. Judge Hood said she is still “tweaking” the order, according to the report.
The state and U.S. government claim BCBS contracts with more than half of Michigan’s hospitals prevent them from charging other insurance companies lower prices. The governments also argue that, in some cases, BCBS agreed to boost reimbursements to hospitals if they charged competing insurance companies higher rates.
BCBS argued to dismiss the case, citing its use of the “most favored nation” clause has already been approved by the state insurance commissioner and the contract conditions help keep costs down for beneficiaries.
Read the Detroit News report on BCBS Michigan and its pending lawsuit.
Hidalgo County is seeking bids for insurance consultant to assist the county in evaluating their self-funded health insurance program – http://www.co.hidalgo.tx.us/bids.aspx?bidID=348
As a business, Delta Dental has no heart. How could it? Delta sells discounts.
The Brownsville Independent School District, the largest employer south of San Antonio with over 7,000 employees, has decided to switch administration of their self-funded health plan from Mutual Assurance Administrators to Blue Cross & Blue Shield of Texas.
We are not surprised – http://blog.riskmanagers.us/?p=6216
There has been some controversy regarding purported PPO discounts through the BISD program for several years. Currently the BISD is in a lawsuit against the HealthSmart PPO network for alledged failure to deliver promised “savings” to the BISD health plan.
A switch from HealthSmart to the Texas True Choice PPO network was purported to have saved the district over $9,000,000 in provider discounts, however that has now come under some scrutiny. Costs under the TTC plan have gone up, not down, with projections to top over $55 million for the year.
The current BISD insurance consultant says that BCBS of Texas has superior discounts and will save the district millions of dollars. During a school board meeting it was represented that projected costs to the district under BCBS of Texas for the upcoming year will be approximately $45 million, or about $10 million less than what was assumed to be the cost should the district had continued with the TTC plan.
Using logic based on representations made by various sources through mainstream media and supported by local blogs, if the cost reduced $9 million going from HealthSmart to Texas True Choice, but now the cost is expected to drop $10 million going from Texas True Choice to Blue Cross, the logical conclusion is that the Blue Cross discounts are about $20 million less than what HealthSmart’s were. If the HealthSmart annual cost in it’s last year at BISD was about $42 million as has been represented from some quarters, then under BCBS the annual spend should drop to around $22 million in total. ($9 million TTC savings plus $10 million BCBS savings = $19 million savings applied to HealthSmart cost of $42 million = net annual cost to BISD of $23 million). A $23 million spend represents more than a 50% reduction in costs going from HealthSmart to Texas True Choice to Blue Cross. THEREFORE, BLUE CROSS MUST HAVE PPO DISCOUNTS THAT ARE 50% OR MORE BETTER THAN HEALTHSMART PPO DISCOUNTS.
A group the size of the BISD is 100% credible.
But wait a minute! If projected costs for the next plan year under Blue Cross is $45 million, where is the missing $22 million in savings? The costs under Blue Cross should be only $23 million, not $ 45 million! Somewhere, somehow there is $22 million missing. Maybe it’s over at the Brownsville Navigation District.
Of course, logic can be twisted to one’s own persuasion and point-of-view. We hope that the exercise in logic demonstated above will cause some pause in the reader’s mind and strike a chord deep within to sustain a burning drive to learn the truth about PPO discounts.
The current BISD insurance consultant is the same consulting firm that recommended HealthSmart PPO several years ago.
The BISD approved continuing with ING as the stop loss carrier. In Plan Year 2009 -2010the commissions on the ING stop loss policy increased 50% as recommended by the insurance consultant on hire at that time – Stop Loss Contract
Editor’s Note: Selling group health insurance these days has become centered around who has the best and lowest provider pricing. But how do you determine who has the best pricing? Blue Cross will tell you they have the best, so will Aetna, Humana, Cigna and others such as HealthSmart and Texas True Choice. Yet the payer (consumer) cannot see any PPO contracts (proprietary, cant tell you or would have to kill you), and more importantly neither or any of the above mentioned providers have access to their competitior’s contracts either. So, a logical conclusion is “Everybody must be Lying About PPO Discounts. ” But, we know the truth, don’t we Don Pedro?
Molly Mulebriar informs us that her investigative team on assignment in South Texas will post a Special Report soon at www.MollyMulebriar.org . We have no idea the content of the report but look forward to reviewing it. Mulebriar does good work, especially in the area of insurance fraud.
For you dentists in Texas who generously perform intricate fillings, extractions and root canals on squirmy kids for near-charity Medicaid fees and far too much hassle, I sincerely thank you for your kind hearts.
However, it’s only fair that Medicaid providers in Texas be warned about developments revealed in WFAA’s breaking report, “Feds investigate Texas dental Medicaid program” by Byron Harris.
“In a letter to the state, the inspector general [US Dept. of HHS] says it will examine the ‘authorization process for orthodontic treatment’ under Texas Medicaid.” Harris adds, “Texas spent $184 million on Medicaid orthodontics last year; that’s nine times as much as California, which spent $19.5 million.”
Sure. We learned that Texas orthodontists have much better lobbyists than California’s, but one shouldn’t miss the subtle warning to dentists about doing business with Texas that is hidden deeper in the article. Billy Millwee of the Texas Health and Human Services Commission said “if taxpayers money had been lost, the attorney general might take action to get it back.”
Doc, imagine years from now, receiving a letter from the Attorney General demanding a refund of hard-earned money you had to fight the state for to begin with. If Texans trust the future of Medicaid to the whims of unaccountable state and federal bureaucrats who don’t know how to conduct business, even more of the poor will be driven to already over-burdened charity clinics. Let’s not play these games. People depend on us.
It’s clear that orthodontists in Texas were ambitious, and their opportunism was wrong. But a deal’s a deal, Texas. Move on. The amount of money state leaders carelessly squandered is not worth the years of harm refund demands from the AG would cause the poor in Texas.
Who would want to do business with the state under that threat?
D. Kellus Pruitt DDS – email@example.com
Editor’s Note: Dr. Pruitt is a Ft. Worth dentist
Molly Mulebriar, ace reporterette, world renowned forensic auditor, and part time contributer to this blog, will be making a major announcement in the next ten days that will affect the lives of many. Contacted in Barbados where she maintains a lush hidden jungle training camp for the committed, Mulebriar gave few details of her immediate plans to change the world.
Mulebriar: Look, you know me, I dont give out interviews. So your wasting time and money calling here. Besides, Im in conference right now with Boris, you know, remember the Budapest caper?
RiskManager: Come on Molly, we know exactly what your up to. The Texas Hospital Association confirmed they exist, and were more than forthcoming with their strategies with Seton Hospital System. We know everything – so lets talk about it.
Molly: I will be making a major announcement next week. Goodbye.
Molly Mulebriar reports that the Texas Hospital Association may be about to publish a position paper on the Cost Plus revolution in Texas. This has not been confirmed.
Cost Plus is a reimbursement methodology designed to save self-funded health plans by paying hospitals their cost as reported to CMS plus a profit margin. Statistics show that Cost Plus a 12% margin lowers health care costs by 43% or more above and beyond traditional PPO discounts.
Hospitals don’t like Cost Plus reimbursement plans yet they are hard pressed to combat the growing phenomenon. Employers who have adopted the concept are committed. The concensus is the battle between hospital’s with their egregious and inflated charges (as perceived by some) and consumers should be in a public arena, the sooner the better. Activity in Austin is brewing.
Editor’s Note: If THA publishes a position paper on Cost Plus, sales for Cost Plus proponents will skyrocket in our opinion. The publicity will be instant and grow nationally. Nothing like free publicity.
Negotiating fees with hospitals is a tough business. It’s like negotiating with a new car dealership for that $500 left front headlight on your new 2011 Chevy truck that you busted trying to run down a family of buzzards on FM 1427 on an idle Saturday afternoon.
Some Texas employers have adopted a Cost Plus approach to reimbursing hospitals and other facilities. Using a public data base (www.ahd.com) to find each hospital’s cost basis as they report annually to CMS, these employers pay each hospital’s cost plus a 12% margin.
When asked if they will accept a Cost Plus reimbursement model, all hospital administrators we have met with offer:
Objection #2 – “No, your cost data is old, dated, and not accurate.”
Answer – “But, the data is this year’s reporting to CMS, to which you have attested to under penalty of sanctions. Are you saying you lied in your report to CMS as to your cost basis?”
Objection #2 – “No, or course not. Let me clarify – our costs have increased since we last reported. And, the CMS reporting does not consider our ancillary services like our at-home nursing subsidary, or our private dining club for senior citizens, or our transportation services to wheel in those lucrative Medicare and Medicaid patients from area nursing homes, or our hospice center. We are actually losing money on those services. So you see, not only is your data dated, it is incomplete.”
Answer – Ok, so you are not against the concept, you are simply saying our information is not credible. How should we proceed with this conversation?
Objection #2 – “How about paying us 65% of billed charges?”
Answer – Can we have a copy of your Charge Master?
Objection #2 – “Are you insane?”
For the past several years many of our clients have moved away from a world of fantasy and make believe into a world of Common Sense, Logic, and Prudent Business Practices in the never ending search for fair and equitable health care pricing.
We have met with numerous hospital administrators in an effort to negotiate fair and reasonable rates. What we have found is a carefully rehearsed series of objections common to all we have met.
One hospital administrator parrots another. It is now exceedingly easy to anticipate the content and outcome of any meeting with any hospital administrator anywhere.
Why not pay a hospital using Medicare pricing as a benchmark? That seems logical and makes sense. After all, hospitals have been filing Medicare claims for years, and have the systems in place to do so.
But, below is the standard hospital response:
Objection #1 – “We do not have the system set up to bill your client RBRVS based rates.”
Answer to #1- “Oh really? Don’t you bill Medicare for almost 80% of your patients? That’s all were asking you to do here, with a premium load to you of, say, 10%. Can’t you do that?
Objection – “Nope, it’s a systems problem, an insurmountable systems problem.”
Answer – “Ok, we will do it from our end. Just send us your inflated charges, based on your mysterious and onerous Charge Master, and we will adjudicate the claim based on RBRVS + 10%, less duplicate charges and medically unnecessary charges. ”
Objection – “Nope, No Can do. Our system is not designed for that. It is an insurmountable systems problem.”
Editor’s Note: Conclusion – Hospitals employ lousy I.T. geeks or Hospital Administrators are lousy liars.
Fan Mail Letter received from an insurance consultant:
I think you hit it on the head on both accounts- lousy systems and lousy liars. Add a third- stupidity.
Plus they don’t get the business that we are in. I once told a hospital client that I could get them lesser rates if they switched to the PHCS PPO for their employees who use other hospitals. They said they didn’t want to do that because PHCS paid so little to them on their contracts with PHCS.
Later I was consulting for the same hospital that switched from Blue Cross to PHCS for their own employees in their own hospital. They didn’t like the discounts PHCS was taking. I asked them if what PHCS was allowing was greater than cost. They said yes. So I tried to explain to them that they should just be running their own employees bills through at cost. They didn’t even need a TPA. They didn’t get that!
Fan Mail received from a large National TPA:
This article is a good one. So tired of their excuses. Also we do have some hospitals who are doing Medicare + so I think the rest of the hospitals are lying about not being able to get the system to accept it.
Brett Bowers <Brett.Bowers@tmliebp.org>
|To:||Brett Bowers <Brett.Bowers@tmliebp.org>
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With the looming threat of an almost 30% cut in reimbursement under Medicare, cost shifting to private pay plans will take an historic turn for the worse. Remember that nasty little term called “Trend?” Insurance companies have traditionally blamed advanced medical technology and an aging population as the key components. Instead, should we point to the Washington political elite as the root cause?
The South Texas Health Cooperative (STHC) is celebrating it’s twelth year this month. Established in 1998 as a self-insured pool for Texas public school districts seeking cost effective health care for their employees, the STHC has achieved an enviable record in keeping costs down through innovative risk management techniques.
Direct provider contracting, innovative plan design, pro-active risk management have contributed to the success of the program. For the past five years the STHC has keep plan contributions essentially static while improving benefits.
Texas public school districts and other political subdivisons may elect to participate through an Interlocal Agreement.
For more information, contact Jim Blackburn, Risk Manager of the STHC, @ JimBlackburn151@gmail.com
“Physician reimbursement under Medicare and Medicaid is going to get hammered. Hospitals are going to see substantial cuts in reimbursement as well.” Cost shifting to private payers will become even more onerous.
Early Monday Morning, United HealthCare sent a Dear John email to independent agents and brokers. On fully insured group health plans of 100 or more employees, United HealthCare will no longer pay commissions. Instead, affected agents are advised to ask their clients to pay them directly.