Humana’s wellness program improved employee health as well as lowered healthcare costs, according to a two-year study of more than 13,000 employees, the Louisville, Ky.-based insurer announced yesterday.
Archive for April, 2014
The San Benito CISD Board of Trustees may soon decide to provide the school district’s embattled on-site health clinic provider with a 60-day termination notice for the second time in less than a year.
Board members are expected to consider giving Richard Garza, the owner of ISD Managed Care Services Inc., the Port Isabel-based company that currently serves as the administrator of the school district’s on-site health clinic; with a 60-day written termination notice at a special school board meeting scheduled for 7 p.m. Wednesday, April 30. Such action comes after the Internal Revenue Service recently placed a $315,603.43 lien on district funds owed to Garza.
Want the whole story? Pick up a copy of the April 30 edition of the San Benito News, or subscribe to our E-Edition by clicking here.
School district officials confirmed this week that the Internal Revenue Service has placed a lien on San Benito CISD funds owed to the district’s on-site health clinic administrator, who owes the IRS more than $315,000.
SBCISD attorney Tony Torres sent an email to the Board of Trustees on Wednesday informing the board members that the district received levy notices from the IRS regarding Richard Garza, the owner of ISD Managed Care Services Inc. – the Port Isabel-based company that currently serves as the school district’s on-site health clinic provider.
Sub-Minimum-Value Coverage (Skinny Plan) Strategy and the Unaffordable Coverage Strategy
Ever buy Alien Abduction insurance? It’s pretty cheap. How about UFO Kidnapping Insurance? That’s just about as cheap as an Alien Abduction insurance policy. And what about coverage for $1 million health care claims? That’s dog-gone cheap too. In fact, less than $1 per month. A careful analysis of one’s monthly budget might bring a reasonably prudent person to a crystal clear conclusion that $1 may be better spent on Alien Abduction Insurance. At least that would allow you to stand out at social gatherings, giving you bragging rights with added confidence, breathlessly passing subtle comments to the redhead in the corner like “I used to have a $1 million health insurance policy but I switched to a $1 million Alien Abduction Insurance plan instead and since then I have felt so much more secure!”
On the other hand, coverage for a $50,000 health insurance policy can be pricey.
Discount vs. Cost-Plus
From a financial perspective, the discount model employed by PPO’s is ineffective because a discount based on an inflated price does not provide effective cost containment. It is not anchored to the real cost of care. Rather, this outdated approach encourages gaming of the system as providers seize the opportunity to raise their prices disproportionately to their true costs in order to increase their “discount.” However, true cost containment is reached when our cost-plus methodology is used. Once we have a claim clean of errors and fraudulent charges, we assess the actual cost of the care provided, and then reprice the claim to acomodate the cost, plus a reasonably negotiated fee.
“The cost-plus system virtually guarantees that health insurance premiums will go right on rising, because the people who are directly responsible for controlling hospital costs find the only way they can increase their revenues is by increasing their costs. . . . ”
“People should know what things cost in health care,” said Jeanne Pinder, founder and CEO of clearhealthcosts.com. “We’ll use the power of our communities to reveal the secrets of the marketplace, and join hands to make this opaque system more transparent.”
PPACA does not mandate where a service or covered product is to be purchased. If you can get a full course of treatment for Sovaldi for $900 in Brazil versus $33,600 per month in the United State, it may make sense to export the patient as opposed to importing the drug. Sitting on a beach in Brazil with an umbrella drink in between treatments sounds appealing.
“Many benefit plans are bound by contracts they either don’t understand or have never seen” – Adam V. Russo
Cash is King, especially in the medical reimbursement arena. Members of the 50% Club can attest to that. (Type in “50% Club” in search box on this blog).
Hospitals offer deep discounts for cash, often better pricing than managed care contracts. Contrary to representations of the BUCA’s, size means nothing. A lone patient with cash can always beat the big boys in health care pricing.
Imagine an employer sponsored health plan transitioning to a Cash Plan and the savings to be realized. Turning plan participants into cash paying customers – Is that possible?
A Texas TPA says it is not only possible, they are doing it.” Borrowing on the PBM method of financing, a line of credit allows the TPA to negotiate and pay facility claims quickly and efficiently.
A recent claim transaction illustrates the effectiveness of this approach. A gross billed charge for an outpatient procedure of $12,000 was reduced to less than $2,000 with a cash pre-payment by the TPA using their own line of credit to fund the payment. At the end of the month, the TPA recouped their funds through a claim draft against the Plan Sponsor’s claim account. The PBM financing model is now extended to include medical claims.
We knew it was only a matter of time someone would think of this and actually do it. (My father invented the weed eater in 1955 but never bothered to obtain a patent, much less build one). Turning ideas into action is hard for some.
Of course, it’s not as simple as one would expect. Plan document language and stop loss contracts must mirror the scheme. But details are someone else’s problem, right Uncle Hermann?
Editor’s Note: Molly Mulebriar is a free lance reporterette from Waring, Texas.
Insurance agents, brokers and consultants better dust off their E&O policies and read them. There is a good chance they may not be covered in areas they need to be due to increased exposure under PPACA. For example, is there coverage for self-funded employee welfare plan sales, service and recommendations? If so, is there a policy sub- limit such as $250,000? Giving advice as a fee based insurance consultant is almost never covered under most group E&O policies, does yours? Probably not. In fact, one would probably need to go to the surplus lines market to find adequate coverage these days. And what about cost? Standard group A&H E&O policies run around $400-$700 per year. Adequate coverage can cost thousands of dollars per year.
Going bare is risky these days………….
By Ed Hammond in New York
Walgreens has come under pressure from an influential group of its shareholders, who want the US pharmacy chain to consider relocating to Europe, in what would be one of the largest tax inversions ever attempted.
Editor’s Note: Exporting patients and companies seems to make economic sense these days.
“A uniform bill is a single piece of paper or electronic document that summarizes the services provided,” said Mike Dendy, CEO of Advanced Medical Pricing Solutions, a medical bill review service based in Norcross, Ga. “It might have something like ‘pharmacy’ with no details. Every payer in the country takes that uniform bill and writes checks on their clients’ behalf.”
MIAMI, FL–(Marketwired – Mar 12, 2014) – Assent Medical Cost Management (Assent) announced the launch of MAXpay, a fixed dollar reference based pricing program. Targeting Self Insured Plans, MAXpay increases control over healthcare expenses by setting reasonable and fair benefit limits. To determine reimbursements, MAXpay utilizes cost data, multiples of Medicare reimbursement and Medicare-like methodologies, all of which are fully defensible.
Editor’s Note: Cost Plus Insurance / Reference Based Pricing is a growing market phenomenon – Xerox, Eastman Kodak And Cost Plus Insurance
“A new drug that successfully treats Hepatitis C is being hailed as a breakthrough, but is also stirring fierce debate for it’s $84,000 price tag………Compounding the issue surrounding HCV drugs is the fact that India, Egypt, and Brazil may pay just 1 percent of the U.S. price tag for Sovaldi……………..Iran, Kenya, Burma, and Mozambique have negotiated the price of $900 for a course of Sovaldi,…..“It’s unfortunate that American patients, employers, and taxpayers aren’t currently being offered a more reasonable price for Sovaldi,” he said. “It’s an issue of both public health and public solvency.”
Editor’s Note: Specialty drug costs can “break the bank” of any employer sponsored medical plan. And, specialty drug costs are hitting more and more plan sponsors these days, a growing phenomenon. We have several clients whose drug costs have soared as a direct result of specialty drug pricing. One patient, for example, is incurring specialty drug expenses of over $150,000 per year. One group’s Rx spend now represents almost 40% of the total plan spend per year as a direct result of specialty drugs.
Dumping a patient into a public exchange is one solution to getting rid of the risk which is not illegal under PPACA, as far as we can tell (click on link below):
In the case of Sovaldi, perhaps a stipulation in an employer’s plan document to state that the Plan will cover Sovaldi only in India, Iran, Brazil, Egypt, Kenya or Burma. There is nothing in PPACA that specifies where drugs must be covered, is there? Kind of like an EPO or HMO – your covered but only through specified providers who happen to be located in ……..Or how about Reference Based Pricing – “We will pay $900 towards the cost of a full course of treatment of Sovaldi, you pay the difference if any.”
A plan sponsor may offer to pay for the trip to Brazil, including beach side resort, five star accomodations, for the duration of the treatment. Since Sovaldi is so inexpensive in Brazil, even with air fare, lodgings and meals a plan sponsor can save 70% or more. In fact, the patient could even be given a cash reward too along with free, unlimited number of umbrella drinks while under treatment…………….
Life can be paradise as a patient these days. On the other hand, we don’t want to encourage at risk life styles do we?
“Rather than import the drug, let’s export the patient!” – Homer G. Farnsworth, M.D.
Can a self-funded employer limit risk by limiting frequency of benefits?
“Treatment limitations include limits on benefits based on the frequency of treatment, number of visits, days of coverage, days in a waiting period, or other similar limits on the scope or duration of treatment. Treatment limitations include both “quantitative treatment limitations,” which are expressed numerically (such as 50 outpatient visits per year), and non-quantitative treatment limitations, which otherwise limit the scope or duration of benefits for treatment under a plan or coverage. A permanent exclusion of all benefits for a particular condition or disorder is not a treatment limitation. As explained above, classifications of benefits include (i) inpatient, in-network; (ii) inpatient, out-of-network; (iii) outpatient, in-network; (iv) outpatient, out-of-network; (v) emergency care; and (vi) prescription drugs.” – Mintz Levin, Employment Labor & Benefits
The cost of ACA compliance can be significant and it may be unmanageable for large employers who employ many lower-wage workers. That’s because these employers must offer the same ACA-compliant plans to all classes of eligible employees—from hourly workers to the CEO. However, there is a benefit strategy that can minimize this financial impact while meeting the needs of an entire workforce. It includes:
• An affordable Bronze ACA-compliant plan that still meets the “safe harbor” requirements for all eligible employees
• A Minimum Essential Coverage (MEC) plan bundled with a limited-benefit plan offered to low-wage employees (including eligibles)
• Two levels of additional (ACA-exempt) benefits offered on a non-coordinated basis for middle managers and executives
To learn more about this aggressive cost-control approach, download Ternian’s new white paper. Or contact usfor more information about how we can customize this approach to meet the distinct needs of your clients.
Ternian Insurance Group
PPACA has fundamentally changed our health care delivery system. Employer sponsored health insurance plans will go away, replaced by private and public health insurance exchanges. There is a mad rush in the marketplace to seize new opportunities. Private health insurance exchanges are cropping up everywhere. Some will thrive while others will fail. Not all exchanges will be built the same.
As Richard Branson once said, “Don’t bother doing something unless your radically different from the competition.”
RiskManagers.us is in the process of establishing Employers Health Insurance Exchange (EHIX) which will be unlike any other private exchange in Texas.
“It’s a bitter pill for a lot of employee benefits brokers, but shifting their clients’ workers to a health insurance exchange may be the right option now that Obamacare appears here to stay”
BY ALLISON BELL | APRIL 3, 2014
“Medical bill review services that audit hospital bills to identify errors and overcharges can help self-funded employers reduce their health benefit costs.”