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.
Archive for November, 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.
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.
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 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.
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.
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
|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)
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.
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.
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.
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.
“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………………………”
“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: http://www.hospitalvictims.com/Pages/Texas_hospital_prices/Harlingen/Valley_Baptist_Medical_Center.htm
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.
BISD considers change in representation – http://www.bisd.us/Purchasing/sp12-052.pdf
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 (www.mollymulebriar.org) 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.