THE TOP PRIORITIES IN REACHING REAL US MEDICARE FOR ALL IS REVERSING THESE GLOBAL CONSOLIDATED HEALTH MONOPOLIES FIRST CALLED HMOs ----NOW CALLED ACOs AND THE HEALTH INSURANCE MANDATE.
We cannot rebuild our strong US public health quality care in the midst of GLOBAL 1% CAPTURED MONOPOLY CAMPUSES. WE THE PEOPLE the 99% will never elect REAL left candidates while global 1% and global corporate campuses control our US city economies.
Below we see the gradual installation of these global health system monopolies and they came from HERITAGE FOUNDATION gone LIBERTARIAN and the same far-right Reagan/Clinton NEO-LIBERALISM. These right wing think tanks created both the HEALTH INSURANCE MANDATE we must eliminate AND these consolidated monopolies called HMOs now ACOs.
Who is now not only the top global health system HMO/ACO and now our leading health data and public policy resource? KAISER PERMANENTE. Who is STUART M BUTLER----who was tied to HERITAGE FOUNDATION in the 1980s when HMO policies were unfolding only to move to FAR-RIGHT GLOBAL NEO-LIBERAL think tank BROOKINGS INSTITUTION ----
So, these are the ALT RIGHT ALT LEFT GLOBAL 1% POLS that switch back and forth pushing policies that are sold as right wing conservative then sold as left centrist neo-liberal---
WHEN ALL THE TIME THEY WERE BOTH ONE WORLD ONE GOVERNANCE GLOBAL HEALTH SYSTEMS FOR PROFITEERING.
'THE EVOLUTION OF MEDICAL GROUPS
AND CAPITATION IN CALIFORNIA
LAWRENCE CASALINO, MD, PHD JAMES ROBINSON, PHD, MPH
Prepared for the Kaiser Family Foundation
'Stua rt M. Butler, Ph.D. is Director of Domestic Policy Studies at The Heritage Foundation. He spoke on October 2, 1989, at Meharry Medical College, Nashville, Tennessee, at their conference, "Health Care for the Poor and Underserved." ISSN0272-W5. 01989byThe Heritage Foundation'.
TODAY the Heritage Foundation is of course denying it was the source for both the HEALTH INSURANCE MANDATE and THE CONSOLIDATED HMO/ACO.
THIS ARTICLE IS VERY LONG BUT PLEASE GLANCE THROUGH.
How the Affordable Care Act Fuels Health Care Market Consolidation
August 1, 2014
Senior Visiting Fellow
Copied Select a Section 1/0 Heritage Foundation
The Affordable Care Act (ACA), often called Obamacare, accelerates the pernicious growth of market consolidation in American health care.
The national health care law reinforces the trend of providers, including doctors and hospitals, to merge into large regional health systems that dominate local markets. The law also introduces new rules and restrictions that will reduce the degree of competition in the insurance market.
This growth of monopoly power is not the result of free-market forces, but the deliberate product of public policy. Instead of honestly budgeting in order to finance health care, policymakers have repeatedly sanctioned monopolistic hospital markets in the hope that dominant providers will use higher revenues to cross-subsidize indigent and emergency care. The purchasing power of the Medicare program has been increasingly employed by the federal government to shape the structure of the hospital industry, and its payment rates are deliberately designed to give incumbent general hospitals an advantage over less expensive specialty facilities. At the state level, policies such as certificate-of-need (CON) laws have been defended by local hospital monopolies to prevent the construction or expansion of facilities by potential competitors.
The ACA eliminates many of the essential competitive checks remaining in the American health care system. Because the law relies so heavily on unfunded regulatory mandates to finance the benefit structure, it is obliged to strengthen the power of incumbent providers to prevent targeted competition from eliminating their profit centers.
The provisions of the law attempt to do so by:
- Closing off alternatives to paying for health care by requiring individuals to purchase comprehensive insurance.
- Reducing the ability of insurers to compete with innovations in benefit design by requiring standardized benefit packages.
- Increasing the discriminatory subsidies that protect dominant hospitals from competition.
- Limiting patient choices by using Medicare payment policies to drive doctors and other medical professionals into a small number of integrated hospital systems.
The President’s health care reform therefore represents a concerted attempt to prevent competition in various aspects of health insurance—including health benefits, provider networks, and cost. In the process, the law has become a fountain of federal regulation. With the law’s individual mandate, forcing most Americans to purchase health insurance regardless of cost, the power of insurers and providers to profit from a captive market is likely to increase even further. The ACA adds to the array of regulatory instruments that attempt to contain the damage of anticompetitive policies.
But, the way to increase provider responsiveness to the needs of patients is not through a second set of regulations that punishes providers for doing what the first set of regulations encouraged them to do. In the absence of competition, highly integrated health care providers tend to be irresponsive to patient needs, and reliant on crude bureaucratic instruments to prevent costs from spiraling out of control. Rather than trusting monopolies to provide “uncompensated care” as desired, policymakers should remove the shackles that have been placed on competition in health care, and transparently appropriate the necessary funds for the care that they wish to subsidize.
Combating the Conglomerates.
There is no shortcut for fixing the problem of monopoly power in American health care. It was deliberately constructed, and policymakers seeking to reform it must take on a formidable set of entrenched practices and policies. Specifically, they must: Eliminate unfunded mandates that are incompatible with competition; repeal legal or regulatory restraints on market entry; retarget health care subsidies and tax breaks from institutions to individuals; allow patients to shop around for less expensive options; and abolish health care benefit mandates that create captive markets for providers regardless of value for money.
The Rise of Hospital Monopolies
Within the United States, medical prices vary wildly. For instance, one California employer found itself paying between $848 and $5,984 for colonoscopies with no discernible difference in quality, while MRI scans in the D.C. metro area range from $400 to $1,861, and hip replacements have been found to cost anywhere from $11,100 to $125,798.
Physicians order medical procedures for their patients, but those procedures are largely paid for by third parties (the government or insurers). Private insurers are legally obliged to cover “medically necessary” care, whatever the cost. As patients have little motivation to travel far in search of competitors offering the same care at lower prices, if there is only a single hospital nearby that is able to provide that care, it can dictate high reimbursement fees.
Because third-party-payment systems insulate patients from the true costs of care, hospitals without nearby competitors are able to leverage the strong patient preference for geographic convenience to demand a premium from insurers. The desire of hospitals to take advantage of this situation has yielded a cumulative process of mergers into “must have” branded units that dominate local markets. There are roughly 5,000 hospitals in the United States. Between 1998 and 2012, there were 1,113 mergers and acquisitions involving a total of 2,277 hospitals. Thus, hospitals have been aggregating into fewer and larger economic units, inflating market power. The principal effect of the mergers is to reduce price competition by forcing payers to negotiate with a single entity encompassing most of the hospitals in a given geographic region. That, in turn, gives the merged entities greater leverage to extract higher reimbursement from private and public payers.
Yet, the resulting problem is not primarily, or even mostly, one of supersized profits. Prices have soared at nonprofit and for-profit hospitals alike. Indeed, in 2012 the vast majority of community hospitals in America (3,931 of 4,999, 79 percent) were either government-owned or not-for-profit organizations. Rather than increasing profits for investors, inflated hospital incomes instead tend to be dissipated across a multitude of medical personnel, auxiliary staff, and suppliers—as well as wasted on unused capacity. The reality is that monopolies in economic sectors dominated by nonprofit organizations (such as health care or education) produce broadly diffused inefficiency, overpayment, and organizational bloating rather than supernormal profits.
These problems are particularly acute in small local markets. Empty beds can cost around $75,000, and raising occupancy from 59 percent to 79 percent has been estimated to reduce hospital operating costs by around 9 percent. In some cases hospital mergers can indeed increase efficiency by eliminating duplicative overhead, reaping economies of scale in procurement, or improving quality with a greater volume of specialized procedures. Indeed, the initial wave of mergers proved beneficial to consumers, yielding average price reductions of 7 percent. Thus, if markets were truly competitive, there would still likely be some hospital mergers, and those mergers would produce consumer benefits in the form of quality and access improvements as well as price reductions.
Savings from such mergers, however, are likely to be substantial only for small hospitals. While the consolidation of hospitals has often generated cost efficiencies, in hospital markets dominated by only a few providers, mergers have enabled hospitals to retain the savings rather than passing them on to consumers. Beyond a modest scale, mergers tend to inflate costs, and to be sought for the sake of increasing pricing power. Increasingly, hospitals are consolidating into larger systems—a process that boosts their ability to demand high prices, but does little to generate efficiencies or shed costs. There is a clear consensus in the peer-reviewed economics literature that prices tend to increase by at least 20 percent following hospital mergers in concentrated markets.
Pushing back against rising hospital bills, managed-care organizations (MCOs) became increasingly prevalent during the 1990s. As motivated, capable, and price-sensitive purchasers, MCOs were able to check the ability of providers to inflate costs. By threatening to steer patients from one provider to another (“selective contracting”), MCOs had leverage to insist that prices be kept within reason. This proved highly effective: A comparison of heart attack patients revealed that MCOs were able to provide the same treatments and health outcomes as indemnity plans at 30 percent to 40 percent lower prices.
The bargaining power of hospitals, and their ability to impose price increases, therefore depends on the ease with which insurers may omit them from their provider networks. Their consolidation into multi-hospital systems, which bargain collectively with insurers across multiple markets, enables hospitals to make themselves harder to exclude—allowing them to command price increases twice the size. Thus, the effectiveness of selective contracting in checking hospital cost growth has been blunted in highly concentrated hospital markets. The ability of insurers to insist on good prices from hospitals has further been hobbled by “any willing provider” laws in the majority of states, which require insurers to reimburse any providers willing to accept the insurer’s rates, effectively limiting the ability of health maintenance organizations (HMOs) to divert patients to preferred hospitals. The effect has been to reverse the slowdown in the growth of health care expenditures that had been achieved in previous years in areas with high HMO penetration.
Although dominant providers claim that their ability to command higher reimbursements allows them to invest in improving treatment outcomes, the absence of competitive pressures tends to actually produce organizational slack, weaker accountability for performance, and lower-quality care. Local hospital markets dominated by a few providers are less likely to employ the best medical equipment, and it appears that heart attack patients are more likely to die when treated by hospitals in markets with less competition. Indeed, better outcomes for heart attack and pneumonia patients in more competitive markets appear to be associated with the relative prevalence of private payers, who are able to vary payments to reward higher quality.
Evidence that monopoly power has allowed hospitals to push up prices without improving quality has led some policy analysts and political activists to claim that expanded government regulation and control of providers can make health care more affordable. To this end, a number of prominent Obamacare advocates have called for a follow-up round of reforms—subjecting hospitals to regulatory caps on prices, aggregate spending limits, cost-effectiveness requirements, and heightened antitrust prosecution.
Yet, such proposals attack the symptoms of monopoly power instead of addressing its causes. As a result, they are more likely to create new problems than to solve existing ones. Any attempt to drive down costs with regulatory price controls can be expected to induce artificial scarcity that further reduces incentives for providers to invest to improve quality and respond to patient needs. Similarly, the problems of inflated costs and excess capacity are unlikely to be solved by preventing mergers. Nor is genuine competition between providers to meet patient needs at the lowest cost likely to be advanced by encouraging hospitals to pursue profits through antitrust suits against each other.
Ultimately, the advocates of these regulatory solutions invariably fail to acknowledge the degree to which the problem of hospital monopolies is an artificial one—deliberately created by government regulation.
How Innovators Can Shake Up Hospital Monopolies
Absent government subsidies and regulations that protect them from competitors, hospitals are unlikely to enjoy outsized market power for long. Health care is not subject to substantial natural barriers to entry, and increased institutional size can often be more of a burden than an advantage.
Larger hospital systems face greater administrative challenges when identifying waste and motivating doctors and staff to keep costs under control. General hospitals lack internal price signals to allocate resources between departments, and must rely on bargaining and cajoling to shift them where most needed. Upgrading and rationalizing capabilities is also likely to be more difficult. Administrators have incentives to hoard spare capacity, while physicians are motivated to deem all care “necessary” to prevent resources from being reallocated elsewhere. That makes it hard for hospital managers to cross-subsidize care in practice, even when their intentions to do so are sincere. Indeed, cross subsidies often tend to be dissipated by higher spending on technologies and services of uncertain value.
Mature organizations often find themselves trapped in an outdated and costly web of commitments to various clients, partners, and capital projects—with the result that bloated costs are more often the product of organizational lethargy than greed. That makes it hard for larger systems to fully benefit from cost-saving innovations. Large hospitals’ administrative expenses are also notoriously elevated. For example, at one Oklahoma “non-profit” hospital system, inexpensive items are routinely billed to patients at outrageous prices ($77 for a gauze pad; $200 for a toothbrush). That creates opportunities for more nimble and efficient competitors to deliver less expensive alternatives—but only if they are not stymied by regulations and reimbursement systems designed to protect incumbent providers.
Ambulatory surgery centers (ASCs), for instance, have emerged as independent specialized providers of outpatient surgery, providing an alternative to costly overnight hospital care. New technologies, such as minimally invasive laparoscopic surgery, enable providers to simultaneously reduce costs and improve results. Surgeries for hernias and cataracts, and arthroscopies, can increasingly be performed on an outpatient basis. In the United States, outpatient procedures rose as a proportion of total surgeries from 20 percent in 1981 to 80 percent in 2003, and these are now mostly performed outside of hospitals. By 2010, there were 5,316 federally certified ASCs.
Some have rightly suggested that “simplicity and repetition breed competence.” Managers at these smaller facilities are better able to learn the specific needs of medical specialists, and to dedicate themselves to clearing away obstacles to the production of cost-effective care. By focusing on elective surgeries, specialty hospitals are also able to avoid cancellations and disruptions arising from emergency cases, allowing them to schedule more operations for the same number of doctors and operating rooms. This allows expensive trained personnel and costly equipment to be used more efficiently, just as Southwest Airlines was able to slash costs simply by reducing the time needed to “turn around” aircraft between flights. Using their most expensive inputs—aircraft and skilled crews—more efficiently, Southwest and its imitators were able to offer lower-cost tickets to the flying public.
In the case of ASCs, their smaller scale allows freestanding facilities to be physician owned—reducing the agency problems inherent in the separation of ownership and control. This improves incentives for reducing waste, and frees physician control of decision making from some of the many bureaucratic intrusions. This is also true of specialty hospitals. Adjusting for the mix of patients, there were 40 percent fewer adverse outcomes in specialty orthopedic hospitals than general hospitals.
The market share of general hospitals has fallen significantly in areas that have seen greater ASC penetration—reducing revenues, costs, and profits. As a result, the proliferation of specialty facilities focused on specific procedures has made it harder for general hospitals to cross-subsidize waste, inefficiencies, and uncompensated care. Not surprisingly, general hospitals have focused on the latter. The American Hospital Association accuses specialty hospitals of selecting the best insured, healthiest, and hence most lucrative, patients. Cardiac services, for instance, can account for 25 percent to 40 percent of hospital revenue and are seen as vital to cross-subsidizing other services.
It is true that there is some evidence that medically complex cases are increasingly being avoided by ASCs and left to hospital outpatient departments. However, the filtering of patients by case complexity might be exactly what makes lower-cost routine high-volume production possible, and selective competition is what usually keeps providers on their toes. Put differently, it is hard to outlaw “cherry picking” without preventing competition altogether. No major innovation to drive down costs will be distributionally neutral. The more fundamental problem is that Medicare’s administrative pricing system overcompensates for some procedures, such as cardiac services, while undercompensating for others.
While specialty hospitals may focus on cases that are easier to treat, they still handle these specific cases at lower cost. One pioneering surgery center in Oklahoma has been able to offer laparoscopic hernia repair for $3,975, while nearby hospitals charge $17,000 for the same procedure—triggering a price war. More generally, the entry of specialty hospitals into a local market has been found to reduce overall costs without adversely affecting care.
By lowering costs, reducing recovery times, and making possible the treatment of previously inoperable conditions, the development of minimally invasive surgery has nonetheless caused spending to rise by increasing the volume of procedures. The growth of outpatient procedures (from 4 million to 23 million) between 1980 and 2005 has far exceeded the concomitant decline in inpatient surgery (from 15 million to 9 million) over the same period. European countries initially restricted outpatient surgery out of fear that soaring volumes would strain public budgets. As a result, in the early 1990s, ambulatory surgery accounted for 50 percent of surgery in the U.S., but only 5 percent in France.
Because the expansion of ASCs has been accompanied by a significant increase in discretionary surgery, some fear that surgeons with an ownership stake in ASCs have an incentive to inflate volumes. Facilities that are wholly owned by physicians, which are most often ASCs, are exempt from the so-called Stark law that prevents the referral of Medicare and Medicaid patients by physicians to hospitals in which they have an ownership stake. Lobbyists representing general hospitals that stand to lose revenue by such referrals have suggested that specialty hospitals represent an “intolerable risk,” and expressed great concern at physician conflicts of interest involved.
Yet, general hospitals are subject to similar conflicts of interest. Moreover, the Stark law is little more than a gesture toward controlling the volume of services billed. The problem of incentives for over-referral is a more fundamental one, and intrinsic to third-party payment, regardless of treatment site. Indeed, given the astronomic amount of over-treating, over-billing, and outright fraud documented in Medicare and Medicaid (which dedicates only a fraction of the resources that private insurers do to police these problems), there is little reason to believe that a general hospital’s institutional structure is much of a solution to this situation.
How Predatory Subsidies Fuel Market Consolidation
Hospital monopoly power is a problem, but it is not an accident. The financing of hospitals is dominated by Medicare and Medicaid. In 2011, public spending accounted for 61 percent of hospital income. The expansions of Medicaid and federally subsidized exchange coverage in the PPACA will further increase this. The organizational structure of hospitals therefore largely reflects the shape of government spending—and major changes in payment, such as the introduction of Medicare or its shift to prospective payment, have altered the practice and pricing of medicine.
Hospital costs are 84 percent fixed: Most of the expense of equipping, maintaining, and staffing a hospital is largely incurred whether an additional individual is treated or not. Medicare reimbursements are skewed in favor of dominant hospitals, allowing them to defray overheads, and therefore do much to shut out competitors. Payment methods also inflate the marginal costs of care (the expense involved in treating each additional patient), as Medicare reimburses the same treatments at substantially higher rates if they are performed in general hospitals.
Until the 1980 Omnibus Reconciliation Act, Medicare did not reimburse freestanding facilities not affiliated with a hospital for surgeries at all. Following the 2003 Medicare Modernization Act, Medicare began to reimburse ASCs for a comprehensive range of surgeries, but reimbursed 16 percent more for the same procedures when performed in hospitals. As these low-cost providers have proliferated and taken market share away from general hospitals, Medicare has adjusted the rates, so that in 2013 it paid 78 percent more on average for the same procedures performed in hospitals. For instance, Medicare now pays $362 for a colonoscopy performed in a freestanding ambulatory surgery center, but $643 for the same procedure performed in a general hospital outpatient department. Likewise, under the 2014 Medicare Physician Fee Schedule rate, one hour of intravenous chemotherapy costs $133.26, but the payment rate for the same service under the 2014 Hospital Outpatient Prospective Payment Schedule is 125 percent higher at $299.53.
This disparity will become worse because reimbursements for outpatient surgery in general hospitals are automatically indexed to medical costs, while those in independent centers are adjusted by (much lower) general inflation rates. As if that was not bad enough, the ACA requires that payments to independent surgical facilities be further reduced in line with annual improvements in “medical productivity.” As a result, the assault on competitors by dominant hospitals has finally borne fruit. The growth of ASCs has slowed down substantially—from 5 percent annually in the mid-2000s to 2 percent since 2010—and also hastened a shift of physicians back to performing surgeries at hospitals.
General hospitals claim that these disparities are justified by the fact that, to be eligible for the higher rates, general hospitals must provide care to patients who are sicker, more expensive to reach, and less able to pay. Yet while paying more for such cases may be reasonable, there is no justification for paying the same, higher, rates to hospitals for treating patients who are no sicker, no harder to reach, and no less able to pay.
Such cross-subsidization is not transparent, so its effectiveness and efficiency are neither measurable nor reliable. Indeed, providing subsidies disconnected from outcomes, to insulate such hospitals from competitive threats, is a poor way to ensure that the additional funds reach the neediest people. This has become clear from disproportionate share hospital (DSH) programs, which provide lump sum payments to cover uncompensated costs at hospitals that depend heavily on Medicare and Medicaid. In 2011, 80 percent of hospitals received disproportionate share payments.
These programs are in part justified by reference to the inadequacy of Medicare and Medicaid reimbursement for hospital services. Yet, they provide incentives for nonprofit hospitals to run up huge bills, purchasing goods at inflated pretend-prices to make “losses,” so that they can then claim the need for subsidies for substantial “uncompensated care.” State governments are often complicit in attempts by hospitals to pad Medicaid DSH claims, viewing them as a way to draw matching funds from the federal taxpayer. Following Massachusetts’ expansion of public insurance coverage in 2006, the volume of uncompensated care provided fell much more than the funds claimed to reimburse it. Claims of “uncompensated care” by general hospitals (and states) ought therefore to be treated with a high degree of skepticism.
Similarly, general hospitals cite their obligation to provide unprofitable emergency room (ER) care to all comers as justification for higher reimbursement rates. Yet, the widespread prevalence of ERs, along with their frequent expansion and refurbishment, suggest that they are not as unprofitable as subsidy-seeking general hospitals often allege. Indeed, half of hospital inpatient admissions originate in emergency departments, and general hospitals have long viewed the emergency department as a kind of “loss leader” that generates substantial revenue from subsequent surgery and diagnostic testing.
What is more, freestanding for-profit ERs are proliferating, offering shorter wait times and greater convenience. While they may lack costly helipads, surgery suites, and integrated administrative overheads, they too, are accused of cream-skimming “lucrative” insured patients in “the right ZIP code.” Although Medicare provides subsidies to integrated full-service hospitals for “uncompensated” emergency care above the hospitals’ regular rates, it reimburses freestanding ERs only at its heavily discounted outpatient clinic rates. Even though some states have withheld tax exemptions from freestanding ERs, and others have banned them altogether, the number of freestanding ERs grew from 55 in 1978 to 222 in 2008.
The inadequacy of Medicare reimbursements is also used to justify special lump sum payments to providers based on their geographic location. The 1997 Balanced Budget Act designated a quarter of hospitals as rural “critical access hospitals” (CAHs), and altered Medicare payment rules to reimburse them according to costs claimed rather than services provided. Medicare patients account for 65 percent of CAH inpatient days. However, those higher payments come with strings. The accompanying criteria require that hospitals provide a broad range of inpatient, lab, and ER services, impose restrictions on patient length of stay, and limit facilities to 25 patient beds.
The unintended, and perverse, consequence has been a dramatic reduction in the number of beds in rural hospitals. When the CAH program was established in 1997, only 15 percent of rural hospitals had fewer than 25 beds; by 2004, 45 percent did. As a result, it has become very difficult for such hospitals to act as competitors to each other—even though the majority of them are less than 25 miles from another facility.
These Medicare requirements effectively make nearly every rural hospital a “must have” hospital for the networks of all other payers, both private (insurers and employers) and public (state-run Medicaid and Children’s Health Insurance Programs). Conversion to CAH status has significantly increased hospital revenues, profits, and costs per discharge. The result of all these payment provisions is that CAH hospital revenues increased almost three times as fast as those for non-CAH hospitals, and CAH closures have all but ceased. Thus, largely protected from the risk of bankruptcy, the longer that hospitals participate as CAHs and the higher their share of Medicare patients, the more inflated their costs have become. As a result, rural markets have the most overcapacity (occupancy rates were 45 percent in rural areas, compared with 65 percent in urban areas, in 2011), have the greatest additional market power created by mergers, and are most often dominated by a single hospital.
Protecting Turf, Preventing Competition
When third parties are obligated to finance care, hospitals tend to provide ever more expensive services to attract patients whose costs are charged to others. That results in what some have termed a “medical arms race,” producing spiraling hospital costs. As early as the 1950s, Blue Cross and Blue Shield (the then-dominant nonprofit insurer), with support from the public health establishment, sought to limit hospital cost growth by advocating the adoption of state certificates of need (CONs). CON laws empowered states to regulate hospital capital expenditures, the number of beds, the expansion of services, and the acquisition of expensive medical technologies. The stated objective was to ensure that hospital spending did not grow disproportionately relative to projected clinical needs. CON laws proliferated at the state level during the 1960s, before being mandated nationwide as a condition for states receiving federal grants in 1974. Although Congress rescinded this requirement in 1986, CON laws remain in force across 36 states.
To prevent “unnecessary duplication of facilities,” CON laws require that new hospitals, and existing hospitals seeking to expand, demonstrate both a market need for the increased supply and an inability or unwillingness of existing providers to meet that need. Government regulators must decide the merits of these claims. Incumbents are allowed to rebut claimed “need” during a review process, and opposition from competitors is a primary reason why CON applications are rejected. As a result, CON laws bind only providers seeking to challenge the status quo, while powerful incumbents find it easy to obtain approval for expansion so long as they do not threaten to undercut their rivals’ prices.
States often deliberately employ CON laws to reserve lucrative captive markets for hospitals. Regulators seek to ensure the financial sustainability of facilities and manpower in otherwise unprofitable, or so-called underserved areas. Regulators can also leverage the CON approval process to modify provider behavior and encourage the provision of uncompensated care. As an exercise in political economics, the application of CON laws resembles the practice of ancien régime kings who sought to avoid the need to call parliaments by chartering monopolies to raise revenue. Competitive threats to this arrangement are disparaged as “cherry picking”—even though the empowerment of monopolies is an inequitable, inefficient, and unaccountable method of ensuring that resources are distributed to the needy and deserving. It is, therefore, not surprising that specialty hospitals (which pose a substantial competitive challenge to general hospitals) are more prevalent in states that have repealed their CON laws.
Capacity constraints are a major source of hospital leverage in price bargaining. Thus, the artificial scarcity induced by CON regulation yields higher prices at both for-profit and nonprofit hospitals—with the extra revenue generally dissipated in spending on nonclinical benefits, waste, and inefficient resource allocations. The longer that CON laws are in force, the more the cost of those inefficiencies accumulate and compound. With the establishment of new facilities constrained, hospitals in states with more stringent CON regulations have experienced higher mortality rates. For example, in states where CON laws significantly constrain capacity and slow the entry of new providers, the dialysis industry has seen deteriorating quality of care and increased patient mortality, as firms with market power have been able to neglect standards without loss of demand.
CON laws also divert new investment to unregulated substitutes, rather than constraining costs as a whole. This has led to the inefficient substitution of non-capital for capital inputs in the provision of care—for example, by shifting long-term care services toward more costly non-residential settings. Indeed, by obstructing the expansion of outpatient care facilities, CON laws have regularly served to stymie the development of other more effective methods of cost-containment.
As a result, states that have removed CON regulations have not experienced health care cost increases. Rather, in states that repealed CON laws, the cost of cardiac surgery fell so much that total spending fell even as volume increased. Indeed, as a general matter, the negative effects of CON laws on competition have driven up hospital costs for comparable patients, rather than constraining spending. Thus, under CON laws, any reductions in total spending achieved by utilization constraints are more than offset by the additional spending that results from increased provider prices.
How Obamacare Consolidates Insurance Markets
When the Obama Administration lobbied for passage of the ACA, it launched a concerted campaign to blame the insurance industry for the ills of American health care. Senate Majority Leader Harry Reid (D–NV) blamed the exemption of insurers from federal antitrust laws for premium increases, for the underpayment of doctors, and somehow, even for driving up Medicare costs. Yet, private insurers are largely uninvolved in Medicare Parts A and B, the traditional parts of the program that are fueling its rapid cost growth, while the federal “exemption” only exists to empower states to regulate their own insurers and to enforce their own antitrust laws.
President Obama similarly attempted to justify his agenda by claiming that insurance companies were making record profits, but fact checkers in the media noted that insurance profits had actually been falling due to employees losing coverage during the recession. When, in an address to Congress, Obama blamed “Wall Street’s relentless profit expectations” for the fact that 90 percent of Alabama’s insurance market was controlled by just one company—it was pointed out that the insurer was in fact a nonprofit organization, Blue Cross Blue Shield.
Despite repeated attempts to scapegoat the insurance industry for premium increases prior to the enactment of Obamacare, premiums in different parts of the country largely reflect underlying health care cost trends in state and regional markets. Moreover, taken as a whole, the reality is that American health insurance has largely been more competitive than either popular perception or political rhetoric would suggest. The four largest publicly traded insurers (WellPoint, UnitedHealth, Aetna, and CIGNA) offer plans in nearly all states, along with many additional regional providers. Of these, the largest for-profit insurer (WellPoint) has national market share of only 17 percent. For-profit insurers provide the two largest plans in only 28 percent of local markets.
Market concentration at the state level tends to reflect the market share of Blue Cross Blue Shield plans. Those plans are often protected by state regulations to prevent “cream-skimming” by private competitors. Yet, even providers in markets that are most regulated at the state level have little pricing power, as these insurers must compete with national employer-based Employee Retirement Income Security Act (ERISA) health plans that are exempt from state regulations. When the option of ERISA plans is included, Blue Cross controls only 36 percent of even Alabama’s insurance market.
The profitability (3.3 percent of revenues from 1990 to 2008) of health insurance is not unusual compared with that of other industries. Nor is there any evidence of faster-rising premiums in more consolidated state insurance markets. If anything, the consolidation of insurers has balanced the bargaining power of providers, and encouraged the cost-effective substitution of nurses for physicians. As a result, the American Medical Association is sufficiently concerned by the potential adverse effect that it publishes an annual report denouncing consolidation in health insurance.
Obamacare, in fact, brings about the very problem of insurance monopoly power that its champions in Congress and the Administration promised to solve. The regulations imposed, pursuant to the law, have forced some insurers to exit the health insurance business altogether. Sold as a solution to a supposedly dysfunctional insurance market, it treats competition primarily as a threat (“adverse selection”) that must be suppressed. By mandating the purchase of a government-defined insurance product, it greatly inflates the power of those able to meet that definition, and eliminates many margins for competition. Plans must cover “essential health benefits,” which are statutorily defined to cover all aspects of conventional medical care. This has been specified by regulation to mean the “state benchmark plan”—in most states the largest small-group plan. As a result, the benefit arrangements favored by the incumbent market leader are often now imposed on all. In the single year from 2013 to 2014, individual insurance competition nationwide declined by 29 percent, following reorganization to comply with federal rules for insurance sold through Obamacare exchanges.
There is a genuine need for competition in health insurance to bind plan managers to serving the interests of their enrollees. The business of insurance is not merely a matter of calculating premiums from actuarial tables, but an operation that requires increasingly sophisticated benefit design and administrative capabilities to manage the challenges of moral hazard and fraudulent claims. The difficulty of these tasks can best be seen by the government’s spectacularly poor performance when it has assumed this responsibility. The Government Accountability Office estimated that Medicare fraud in 2010 amounted to $48 billion (more than $1,000 per enrollee), while improper Medicaid payments were responsible for an additional $28 billion.
THERE HAS BEEN REAMS OF DATA AND ACCOUNTABILITY OVER FRAUDS TO OUR MEDICARE AND MEDICAID THAT PLACES THAT FRAUD AMOUNT TO HUNDREDS OF BILLIONS EACH YEAR AND THAT GOES BACK TO LATE 1990s AFTER WHICH THAT FRAUD SOARED.
As with the desire to cross-subsidize hospital care by maintaining monopolies, Obamacare does much to prevent price competition between insurance plans by regulating premiums. “Community rating” regulations require that insurers charge enrollees the same amount regardless of the services expected to be provided, while “risk-adjustment” provisions tax providers who (even inadvertently) attract a relatively healthier pool of patients by cutting prices. With prices and benefits of health insurance increasingly regulated, only administration and advertising are left to competition—margins that are likely to reward scale, and hence consolidation.
The new “medical loss ratio” (MLR) requirement that insurers spend at least 85 percent of premium revenues for large groups (80 percent for small groups and individuals) on claims or “activities that improve health care quality” is also likely to shield incumbents from competition. The need for sufficient scale to comply with MLRs is likely to impede start-up providers, while the requirement to minimize administration costs as a percentage of revenues can be expected to induce mergers. MLRs are also likely to limit the capacity of small insurers to invest in the overheads needed to expand, while the punishment for retaining funds unused for medical expenses is likely to make external funding necessary for investment and therefore to lead to market dominance by for-profit plans. It can also be expected to drive out insurers only partly involved with health care.
An artificial cap on “administrative costs” can be expected both to undermine efforts by managed-care plans to counter provider attempts to inflate medical bills, or to force insurers to rely on cruder methods of limiting access to care. The MLR regulation could make competition-facilitating high-deductible plans harder to provide, and may force insurers to avoid markets with greater moral hazard and relatively greater need for administrative costs. These concerns proved substantial enough that the Obama Administration provided waivers from MLR laws to states with highly concentrated insurance markets out of fear that they would cause the exit of insurers and leave pure monopolies.
MLRs may also be expected to induce insurers to pass administrative and risk-bearing responsibilities “downstream” to providers, so that they can count as medical costs—increasing provider integration in response to both. The desire for vertical integration is, more generally, a deliberate goal of Obamacare. By increasing the degree of third-party payment and restricting the scope for cost sharing, the ACA must rely more heavily on cruder bureaucratic methods of constraining provider prices and utilization. The former Secretary of Health and Human Services Kathleen Sebelius, responsible for the launch of Obamacare, has admitted that aspects of the ACA pushing for the coordination of care are in “constant tension” with antitrust laws.
The ACO Factor.
Accountable care organizations (ACOs) represent the most deliberate step in this direction. ACOs disburse capitated payments for integrated organizations to provide all-inclusive packages to Medicare enrollees, rather than reimbursing them for services provided—allowing them to keep part of the savings relative to Medicare fee-for-service. While designed to encourage the vertical integration of providers and insurers, it is also likely to encourage horizontal integration among entities that are supposed to be competitors.
Rather than checking the revenues of dominant hospitals, the development of ACOs is likely to reduce their exposure to competitive threats, limit the number of independent competing providers, and facilitate collusion among incumbents. Hospitals that integrate and take up insurance services to form the basis for ACOs are unlikely to push patients towards low-cost outpatient care. Indeed, doctors may be forced to participate in ACOs if they want to be reimbursed for treating Medicare patients. Attempts to move away from fee-for-service to ACO reimbursements for patients require physicians to bear risk beyond their control (such as severity of patient illness), and their unwillingness to do so is driving integration into networks of independent physicians.
While ACOs attempt to control the behavior of doctors by bringing them under the aegis of hospitals, other public policies already provide substantial incentives for doctors to abandon independent practice. For instance, Medicare reimburses integrated providers at substantially higher rates, paying an additional “facility fee” for office visits undertaken in hospitals. This has led to Medicare paying twice as much for the same electrocardiograms or diagnostic colonoscopies if they were performed in hospitals, yielding reimbursements for hospital-based physicians up to 80 percent greater than those to freestanding practices.
As regulatory requirements increase for physician reporting and compliance with medical practice standards both within the exchanges and in the Medicare program, physicians are increasingly impelled to participate in large medical systems that are best equipped to handle increasingly complex administrative challenges. While only a quarter of medical practices were owned by hospitals as recently as 2005, since 2008, the majority of physician practices have been hospital owned.
By requiring higher overhead costs to manage utilization and contracting with providers, ACO payments increase the scale that organizations need to achieve in order to stay competitive. While doctors may easily enter fee-for-service markets as independent providers, capitation precludes competitive challenge by organizations too small to offer a comprehensive portfolio of services.
The Exchanges/Medicaid Expansion.
The creation of federally supervised health insurance exchanges and expansion of Medicaid under Obamacare will further marginalize the ability of new providers to undercut incumbents by offering cheaper services directly to patients. Medicaid is already a heavily regulated government program, and fear of competition in the exchanges has yielded requirements that “qualified” health plans secure regulatory approval for premiums, that networks be obliged to encompass well-established providers, and that the marketing of plans encouraging risk selection be prohibited. Under such a situation, insurers are likely to gain more by merging to improve their bargaining position against the regulatory agency overseeing the exchanges than they are by seeking to undercut each other on price. Yet, over the long term, it is hard to imagine that those running the exchanges will not become increasingly cowed by fears of insurer bankruptcy—thus forcing them to accede to the demands of the few remaining, dominant firms.
The Monopoly Problem
—and the Competition Solution Policymakers have increasingly sanctioned monopoly power in health care as a makeshift instrument of public finance, designed to redistribute resources without the need for explicit appropriation of tax dollars. However, government policies premised on the operation of cross subsidies within general hospitals have effectively put health care payers at the mercy of dominant provider systems. This fostering of monopoly power has proven more harmful in health care than in other markets, because widespread third-party payment reduces the price sensitivity of consumers, which is the natural corrective to monopolistic practices.
Rather than propping up monopolists—and in the process punishing competitors for their relative efficiency—policymakers would better serve their constituents by limiting their interventions to targeted and explicitly funded measures to address specific gaps in the health care delivery system. While the justification offered for subsidizing general hospitals and allowing them to engage in monopolistic practices is a need to extend the provision of care, the result has been to create captive markets that are unresponsive to patients and able to impose unnecessarily inflated prices on the broader community. As a result, taxpayers are often forced to pay several times over for the same supposedly “uncompensated care,” which nonetheless remains inadequately supplied.
Policymakers seeking to ensure that hospitals, doctors, and insurers are focused on providing quality care at affordable prices ought to remember that competition is the only way to impose genuine accountability, and they should adhere to the following principles to enhance competition in health care:
- Refuse to prop up monopoly power. Government regulation and spending should not shield dominant providers from competitors. Monopolies are irresponsive to the needs of patients and payers. They are an unreliable method of subsidizing care that tends to both lower quality and inflate costs.
- Repeal certificate-of-need laws. Legislative constraints on the construction of additional medical capacity should be repealed. Innovative providers should be allowed to expand or establish new facilities that challenge incumbents with lower prices and better quality.
- Subsidize patients, not providers. Public policies should be provider-neutral. Payments should reimburse providers for providing care, period. In particular, publicly funded programs should not operate payment systems designed to keep certain providers in business regardless of the quality, volume, or cost of the treatments they provide. If some individuals are unable to pay for their care, policymakers should subsidize such needy individuals directly.
- Allow patients to shop around. Wherever possible governments and employers should put patients in control of the funds expended on their care, and permit them to keep any savings they obtain from seeking out more efficient providers.
- Repeal Obamacare and its mandates. Forcing individuals to purchase standardized health insurance establishes a captive market, making it easier for providers, insurers, and regulators to degrade services and inflate costs with impunity. Repealing Obamacare and its purchase mandates is essential to creating a market in which suppliers have the flexibility to respond to consumer demands for better value for their money.
Time to Reverse Course
The shackling of competition is an essential feature of Obamacare, not a bug. The health care system it establishes relies on unfunded mandates to raise revenue, seeks to cross-subsidize care with regulations, and views genuine competition as a threat to its funding structure. As a result, it is obliged to standardize insurance options and eliminate cheaper alternatives that threaten to undercut its preferred plan designs.
By inhibiting competition between insurers and encouraging their integration with providers, Obamacare further erodes the competitive checks on the monopoly power of hospitals. It strengthens incentives for hospital systems to buy up independent medical practices and surgery centers, weakens the competitive discipline on prices, and reduces the array of options available for patients.
Although some have suggested that price regulation is needed to check the monopoly power of providers, this would only further reduce the responsiveness of health care providers to patient needs. The only genuine solution to the ills of consolidation, and growing monopoly power in American health care, is to attack its root causes.
Policymakers should insist that health care be funded with honest appropriations, rather than unfunded mandates that inhibit competition. They should repeal laws that restrict the entry of new providers, and open up markets to real competition that allows disruptive innovations in financing and care delivery to flourish. In particular, Medicare should be reformed on a competitive basis so that care for seniors is purchased where the cost is lowest, rather than employed as a regulatory instrument to drive health care provision for all Americans into bloated “too-big-to-fail” local hospital monopolies where unnecessary costs cannot easily be monitored or controlled.
Here is Bernie Sanders touting MEDICARE FOR ALL SINGLE PAYER while he pushed and still supports AFFORDABLE CARE ACT 'as a first step to health reforms'. Here we are in raging CLINTON neo-liberal CA where those consolidated health systems started----so, there is NO REAL LEFT organization pushing to end GLOBAL HEALTH ACO MONOPOLIES before we can get to EXPANDED AND IMPROVED MEDICARE FOR ALL----the REAL US quality public health structure that was our Federal Medicare.
Bernie KNOWS this -----and we have those 5% to the 1% labor unions supporting what is ONE WORLD WORLD HEALTH UNITED NATIONS SINGLE-PAYER UNIVERSAL CARE policies calling that MEDICARE FOR ALL.
We thought our NATIONAL NURSES UNITED were pushing REAL left social progressive health policy but they are tied to CA HMO KAISER PERMANENTE policy no doubt trying to support their own jobs.
All of these ALT RIGHT ALT LEFT FAKE left groups from Bernie to Jill Stein to Ellison and Turner----KNOW we cannot get REAL US quality public health EXPANDED AND IMPROVED MEDICARE FOR ALL leaving Affordable Care Act global consolidated health system monopolies in place.
Please do not allow these ALT LEFT groups keep capturing our left social progressive policies bringing them to FAR-RIGHT GLOBAL 1%.
Single-Payer ‘Medicare for All’ Is the Only Health-Care System That Makes Sense
Bernie Sanders and the nurses are right: America needs a “Medicare for All” health-care system. And the change can begin in California.
By John NicholsTwitterApril 27, 2017
Health and Human Services Secretary Tom Price and House Speaker Paul Ryan, the Dr. Jekyll and Mr. Hyde of Donald Trump’s Washington, keep cobbling together new schemes for repealing and replacing the Affordable Care Act—with huge tax cuts for the rich and a lot less care for everyone else. But even with the White House and Congress under Republican control, shredding what remains of the health-care safety net has no appeal beyond the counting rooms of Wall Street.
So Price, Ryan, and their minions are—we should certainly hope—on a fool’s mission. But so are Democrats who imagine that the ACA is popular as anything other than an alternative to the crony-capitalist corruption that makes Price, Ryan, and their campaign donors drool with delight.
The ACA is just OK. It provides some protections, and they are important. But Americans are still stuck with a health-care system that makes them put off routine care because of exorbitant deductibles, that makes major illness not just a physical catastrophe but a financial nightmare, and that rations care in order to boost corporate profits. As the National Nurses United union notes, “Despite ACA restrictions on insurance abuses, insurers continue to find ways to discriminate against the sick, for example, tailoring benefit packages and provider networks to discourage high cost patients from choosing or remaining in their plans, and limiting network choices to exclude providers that specialize in critical services such as cancer care.”
Americans recognize what’s wrong—even if most politicians in Washington do not. “According to a Gallup poll last year (and a similar Kaiser survey), more than half of Americans wanted to repeal the ACA, and most Americans still have a dim view of the law. They know it is not working. They know the deductibles are too high and they can’t afford the co-payments. (Curiously, on the eve of its repeal, a growing number of Americans say they support the law.)” explains Dr. Claudia Fegan, who serves as the national coordinator of Physicians for a National Health Program. “But the Gallup poll also showed that 58 percent of Americans—including 41 percent of Republicans and 53 percent of those who favored repeal--wanted the ACA replaced with ‘a federally funded health care program providing insurance for all Americans,’ in other words, single-payer reform. They want a plan that covers the care they need and lets them see the providers they choose with no out-of-pocket costs.”
The Republican plans are ridiculous. But too many Democrats are too cautious. America needs real health care reform.
Bernie Sanders has the right response. Arguing that “our job is to improve the Affordable Care Act, not repeal it. Our job is to guarantee health care to all people as a right, not a privilege,” Sanders says, “We have got to have the guts to take on the insurance companies and the drug companies and move forward to a Medicare for All single-payer program.”
Sanders gets it, but there are still plenty of DC Democrats who don’t. And even if Democrats had their act together, the partisan balance is against them.
It’s different in states where Democrats are in charge. Meaningful reforms usually get their start at the state level in the US—and at the state or provincial levels in other countries. Canada, for instance, started its long march toward its highly successful national health-care program with a first step by democratic socialist Tommy Douglas and the Cooperative Commonwealth Federation government that swept to power in Saskatchewan in 1944.
California could be America’s Saskatchewan if groundbreaking legislation continues to advance through the legislature. Urged on by the California Nurses Association/National Nurses United and the Healthy California Campaign, the California state Senate Health Committee on Wednesday approved legislation to “guarantee health care for all California residents with comprehensive health services and an end to out of control co-pays and deductibles.”
Sponsored by Democratic State Senators Ricardo Lara and Toni Atkins, the Healthy California Act proposal meets the common-sense standard that the American people are demanding:
- Every Californian eligible to enroll, regardless of age, income, employment, or other status
- No out-of-pocket costs, such as high deductibles and co-pays, for covered health services
- Comprehensive coverage, including hospital and outpatient medical care, primary and preventive care, vision, dental, hearing, women’s reproductive-health services, mental health, lab tests, rehab, and other basic medical needs
- Lower prescription-drug costs
- Long-term care services provided under Medi-Cal continue, and will be expanded with an emphasis on community and in-home care
- No narrow insurance networks, one medical card, real patient choice of provider
- No insurance claims denials based on corporate-profit goals
- Funding through a consolidation of resources currently spent on health coverage, including federal payments for Medicare and Medicaid, major savings from elimination of insurance waste, other bureaucracy, and profits with coordinated planning on health resources, and added revenues through a progressive tax (program)
Those organizers describe the Healthy California Act as “a national model for how all states can act to address the ongoing emergency of individuals and families threatened by high out of pocket costs, inadequate access to coverage, and restrictive insurance networks.”
The nurses are right. “Medicare for All” is not an alternative—it’s the only answer that makes sense.
National media is now telling us that it is Ryan and those FAKE right wing Republicans trying to BLOCK GRANT the other Federal public health trust---MEDICAID. Obama and Clinton neo-liberals COMPLETELY PRIVATIZED AND OUTSOURCED all of our Federal Medicare. The policy of Affordable Care Act that sends our Federal health trust funds as A BOLIS TO LOCAL HEALTH SYTEMS ACOs IS that block granting. These local health systems now receive all our Federal Medicare and Medicaid funding with the ability to spend it anyway they want-----ending EQUAL PROTECTION in how population groups receive those PAYROLL TAX MEDICAL SAVINGS ACCOUNTS.
What are those local ACO health systems doing with our Medicare and Medicaid trust funds? THEY ARE MAXIMIZING PROFITS EXPANDING THEIR CORPORATIONS NATIONALLY AND GLOBALLY with what used to fund actual citizens' health care. It is then those local ACOs which BLOCK GRANT our Medicare Trust funds by throwing that few million to those 5% to the 1% temporary small health businesses. This has created the very same decentralized mess of networks of outsourced health care that allows massive frauds, medical abuses and neglect.
So, yes Ryan as the same far-right wing global Wall Street pol will advance doing the same to MEDICAID as was done by OBAMA to MEDICARE.
We cannot get to REAL EXPANDED AND IMPROVED MEDICARE FOR ALL without reversing all this privatization and outsourcing and rebuilding a centralized public health system regulated and enforcing civil rights and patient's rights. That will not happen with AFFORDABLE CARE ACT still in place. What are Bernie and FAKE ALT LEFT groups promoting? LEAVING AFFORDABLE CARE ACT CONSOLIDATED MONOPOLIES DEREGULATED AND PROFITEERING in place while continuing to build TELEMEDICINE AND PREVENTATIVE CARE WELLNESS.
We cannot return to US quality health care for all with the entire Federal Medicare and Medicaid privatized and outsourced without oversight and accountability and this happened because of AFFORDABLE CARE ACT.
Ryan Budget Will Block Grant Medicaid, Voucherize Medicare
03 Apr 2011 David Dayen
Rep. Paul Ryan (R-WI)
In a way, the continuing resolution on the 2011 budget is really a prelude. It has dominated headlines because of the immediacy, and the threat of a government shutdown if no deal is reached. That discussion is ongoing, and while agreement has been reached on a level of cuts, where the cuts fall, and particularly the unrelated policy riders, are up in the air. And time is short.
But it’s next year’s budget, not this one, where Republicans will really seek to transform American society and the social safety net, with major changes to mandatory spending programs. House Budget Committee Chair Paul Ryan will introduce a plan this coming week, which will start with a $1 trillion cut to Medicaid:
House Republicans are planning to cut roughly $1 trillion over 10 years from Medicaid, the government health insurance program for the poor and disabled, as part of their fiscal 2012 budget, which they will unveil early next month, according to several GOP sources […]
OBAMA AND CLINTON NEO-LIBERALS GUTTED MEDICARE AND MEDICAID OF THAT SAME $1 TRILLION---SO THIS IS ON TOP OF OBAMA-ERA CUTS.
To bolster their cause, GOP leaders point to years of requests from governors to reform Medicaid so their states aren’t on the hook for so much money in the federal-state partnership.
Because the new health care law includes a major expansion of the program, there’s a double bonus for GOP leaders slashing it: It’s a bigger pot than it used to be, and it’s a major component of what Republicans derisively call “Obamacare.”
Fully half of the coverage additions in the Affordable Care Act come from a Medicaid expansion, most of which gets paid for by the federal government. The way Ryan will reach these kinds of savings is by eliminating that expansion, which would deny health insurance to 15 million people, and then turning Medicaid funding into a block grant.
Right now, Medicaid is an entitlement program. That means the federal government, in partnership with the states, must enroll everybody who meets the program’s guidelines. In other words, if millions of additional people become eligible because, say, they lost their job-based insurance in the recession, than the feds and the states have to provide them with coverage and find some way to pay for it. And it can’t be spotty coverage, either. By law, Medicaid coverage must be comprehensive.
At least, that’s the way it works now. If the law changes and Medicaid becomes a block grant, then every year the federal government would simply give the states a lump sum, set by a fixed formula, and let the states make the most of it. Conservatives claim block grants would give states the flexibility they need to make their programs more efficient. But, as Harold Pollack has noted in these pages, states already have some flexibility. And because demand for Medicaid tends to peak during economic downturns, when state tax revenues fall, the likely impact of a block grant scheme would be to make Medicaid even less affordable at the time it is most necessary.
Though Medicaid is seen as a program for the poor, most of all Medicaid spending comes from the elderly and people with disabilities. The elderly are 10% of the enrollees and take up 25% of the benefits; the disabled are 15% of the enrollees and take up 42% of the benefits. That’s specifically who you would hurt with this proposal. States would unquestionably limit enrollment under a block grant scheme; not even Newt Gingrich could deny that. That’s millions more people without health insurance, on top of the 15 million denied coverage because of killing the coverage expansion.
Medicare, under Ryan’s plan, will be reformed into a premium support system for those younger than 55 years old, a proposal similar to the Ryan-Rivlin plan […]
Democrats could use the plan as a “political weapon,” Ryan said.
“We are giving them a political weapon to go out against us, but they will have to lie and demagogue to make that a political weapon,” he said. “They are going to demagogue us, and it’s that demagoguery that has always prevented political leaders in the past from actually trying to fix the problem. We can’t keep kicking this can down the road.”
I’m pretty sure you don’t have to lie about these plans, just describe them. The Orwellian term “premium support” means one thing: a voucher for individuals to purchase health insurance on the private market, thereby privatizing Medicare 20 to 30 years out. The “savings” come through not raising the level of the voucher over time, making it unable to purchase the same amount of insurance. The plan here is to save money by making old people unable to get well when they get sick. More on that here. Now, if we would simply let seniors use those vouchers to buy into other countries’ health care plans, maybe this would work fine, but I don’t think that’s what Paul Ryan, a globalization enthusiast, has in mind.
We’ve seen how the Democrats have handled the minor-league budget battle; the big leagues are coming up next.
We cannot get back to REAL US quality health care for all while trillions of dollars are spent building ONE WORLD ONE TECHNOLOGY GRID to have global health tourism and global telemedicine.
INNOVATION OVER ACTUAL HEALTH CARE ACCESS IS NOT REAL LEFT SOCIAL PROGRESSIVE.
We have watched during several years of Obama TRILLIONS of dollars directed to infrastructure around telemedicine and global health tourism. That is just the TIP OF A FUNDING ICEBERG. It will take trillions of dollars more over these few decades to build these ONE WORLD GLOBAL HEALTH TECHNOLOGY STRUCTURES then it will cost trillions of dollars more to MAINTAIN these structures ----all of those trillions are what used to be ACTUAL US QUALITY HEALTH CARE ACCESS FOR ALL -----we cannot get to REAL EXPANDED AND IMPROVED MEDICARE FOR ALL by allowing MOVING FORWARD GLOBAL TELEMEDICINE HEALTH TOURISM.
All of these FAKE ALT LEFT groups shouting SINGLE-PAYER, UNIVERSAL CARE, MEDICARE FOR ALL know we will not be returning to the quality health care for which we PRE-PAID.
There is NO GETTING TO REAL EXPANDED AND IMPROVED MEDICARE FOR ALL------with all these global telemedicine innovative networks operating independently with NO OVERSIGHT AND ACCOUNTABILITY---- Private global health corporations should be paying to build these systems themselves and not using our trillions of dollars in Federal funding for strong public health structures AND OUR FEDERAL MEDICARE AND MEDICAID TRUSTS.
Innovation in telemedicine technology: An entrepreneur's perspective
ATA Vice President Yulun Wang says innovation will help telemedicine reach its inflection point.
By Yulun Wang
May 06, 2013
The need to provide high-quality healthcare to everyone while reducing costs has reached a crisis level, where it's a major focus of the highest government offices. More and more politicians and healthcare leaders are realizing that telemedicine is clearly a cornerstone of the solution. This is tangibly seen by the increasing number of healthcare systems that are adopting telemedicine, by the growth of ATA and by industry investments in telemedicine products and services.
I believe that telemedicine is now reaching an “inflection point,” where the industry will grow at an exponential pace. We are realizing that if one can bring the right clinical expertise to the right place at the right time to make the right medical decision in a cost effective manner; quality can be improved while costs are lowered.
Although the concept of telemedicine is simple and elegant, implementing it can be complex and messy. This is not unexpected, as fundamental change in any industry is never easy and without obstacles. As one works to implement telemedicine in order to benefit from this enabling technology, one quickly uncovers the many challenges in actually building telemedicine programs. Barriers created by existing payment structures, regulatory policies, IT architectures, corporate boundaries, resistance to change and technology limitations all need to be overcome. It is these barriers or challenges, coupled with the significant potential value that can be created, that make telemedicine ripe for innovators and entrepreneurs.
I believe that through persistent innovation, usually accompanied with the risk of capital, entrepreneurs can overcome these barriers and unleash the benefits of telemedicine into our healthcare delivery system.
To succeed in creating positive change I believe in the “divide and conquer” theory. Trying to orchestrate a singular fundamental change to our healthcare delivery system to incorporate telemedicine systemically is too monumental a task, and will likely fail. The pathway for entrepreneurs to innovate successfully is to find appropriately sized healthcare workflow challenges that can benefit from telemedicine solutions, and then work to gain adoption from healthcare providers. With adoption, the entrepreneur can continue to build on that success and expand the vision and market opportunity.
As the telemedicine industry grows, applications are partitioned into two broad categories differentiated by the health status and location of the patient. The first category is “acute care telemedicine,” in which telemedicine is used to enable remote clinicians to immediately diagnose and treat sick patients. These patients may be very sick and require immediate help from a specialist who is difficult to access. The second category is “chronic disease management telemedicine,” where telemedicine is used to periodically and regularly monitor and manage a person’s chronic illness.
The needs of the telemedicine solution and the economic model vary greatly across these two categories. Telemedicine solutions for acute care must enable a remote clinician to be interactively present in the patient environment and gather pertinent medical information through examination and data access to form a medical decision. Often, this decision can have significant (e.g. life or death) consequences. If the remote clinician is the physician-in-charge, then the system must enable the physician to lead and establish dominion over the complete environment. Conversely, telemedicine for chronic disease management generally does not require acute medical decision-making, and the interactions are more coaching and mentoring in nature. These solutions often connect healthcare providers into patient’s homes and therefore must scale cost effectively to a single patient/single system mode.
Telemedicine entrepreneurs should identify opportunities where they can innovate manageable-sized solutions that create significant value for healthcare providers. Still, change is always difficult, particularly in the field of medicine, where process and procedures are honed and perfected over decades to ensure that every patient receives consistently high quality care. Therefore, the solution must solve the problem in its entirety for adoption to occur. For example, solutions should not be limited to technology alone, but rather, they need to be coupled with clinical protocols, business plans, training and implementation services, regulatory assistance and even the ongoing monitoring and measuring of the solution's impact. The level of multi-disciplinary depth and detail required to facilitate a change can tax even the most persistent entrepreneurs.
Healthcare is in a seismic state of transition that hasn’t been seen for many decades. The fundamental goal of changing from “fee for service” to “fee for value” and competitive pressures re-aligned to drive continued improvement of the quality/cost value curve is enabling telemedicine to transition from a research topic to mainstream medicine. Generational changes like these happen infrequently, and should be embraced by adventurous entrepreneurs. We are at a time when the need for innovation and entrepreneurism in telemedicine is at a maximum.
Yulun Wang is chairman and CEO of InTouch Health.
THIS-----is UNITED NATIONS/WORLD HEALTH ORGANIZATION UNIVERSAL CARE -----being called MEDICARE FOR ALL by fake ALT RIGHT ALT LEFT groups.
MEDICARE FOR ALL-----SINGLE-PAYER-----UNIVERSAL CARE IS ALL TELEMEDICINE FOR ALL 99% WHILE GLOBAL 1% AND THEIR 2% RECEIVE MARKET-PRICED EVER MORE EXPENSIVE ORDINARY US QUALITY HEALTH CARE FOR WHICH OUR US 99% PRE-PAID.
Telemedicine for all
Published on Jan 3, 2012 YOU TUBE
Find out how doctors and specialists are easily collaborating online, even reviewing high fidelity images, to support patients in rural areas. Learn more at www.microsoft.com/health/ww
This is the entirety of OBAMA's several year term in office. It is global IVY LEAGUE HEDGE FUND medical universities pushing these policies and they were the same health corporations joining all the health industry fleecing our FEDERAL HEALTH AND HUMAN SERVICES public health funding, trusts, and programs to expand these EXCLUSIVE AND REGRESSIVE and what we know will become REPRESSIVE health structures......the protests for REAL LEFT health policy starts in downsizing local US city health monopolies like GLOBAL JOHNS HOPKINS----
Why Telemedicine Is Finally Ready to Take Off
Healthcare reform, technology and Capitol Hill legislation with bipartisan support all point to a bright future for telemedicine. In fact, this may be the year that telemedicine gains widespread adoption
By Brian Eastwood
Senior Editor, CIO | Feb 25, 2013 7:00 AM PT
For decades, telemedicine has long been associated with patients who are far, far away: Native Americans in Alaska, workers on oil rigs, scientists in Antarctica or astronauts in space. Numerous roadblocks—chief among them reimbursement, physician licensure, clinical workflows, infrastructure costs and unclear value propositions—have, for the most part, hindered telemedicine's advance into regular care delivery.
However, 2013 may be the year that the healthcare industry begins to move from isolated pilot programs to more widespread use of telemedicine.
It's not just that the technology is cheaper and easier to use, either. Washington, D.C. is taking notice. The Obama administration's healthcare reform law emphasizes coordinated, accountable care—in which telemedicine can play an important part—while proposed legislation from U.S. Rep. Michael Thompson (D-Calif.) would remove many of the bureaucratic barriers that hinder telemedicine's spread.
The American Telemedicine Association was formed in 1993, so CEO Jonathan Linkous isn't exaggerating when he says he's been waiting 20 years for this. "Healthcare is a late adopter," he says, "and it doesn't do anything without plodding, moving ahead and thinking about it."
Now is the time, he says, because the healthcare industry in the United States is undergoing "transformation." Healthcare reform, the needs of baby boomers, the growing challenge in treating chronic conditions and the sheer number of uninsured Americans leaves the industry at an inflection point, and telemedicine can accelerate this transformation. "It's not the answer, but the tool:hellip;to solving a lot of healthcare's problems."
Telemedicine Adoption Slow; Healthcare Cost Increases Fast
Those problems are well-documented. In 2012, the United States spent 18 percent of its GDP on healthcare, compared to less than 5 percent in 1950, and that's projected to rise to 30 percent by 2050. Meanwhile, roughly one-third of the $2.5 trillion spent in 2012 was wasted, thanks to a combination of fraud, red tape and duplicate tests.
Jonathan Gruber, an economics professor at the Massachusetts Institute of Technology who spoke at the recent MIT Future of Health and Wellness Conference, says American healthcare is broken because the status quo works well for 75 percent of Americans—largely the healthy ones covered by corporate insurance plans—but is "substantially broken" for everyone else. The Affordable Care Act—which Gruber helped draft, along with the Massachusetts healthcare reform law of 2006—makes numerous strides to change this, with initiatives such as the accountable care organization and the health insurance exchange, but it's a process that requires humility and patience, he notes. (Few in Washington possess either characteristic, Gruber adds.)
Billions of connected IoT devices open the door to an overwhelming number of security vulnerabilities. Here’s a pragmatic approach to reducing the risks.
For the most part, adoption of telemedicine has proceeded similarly. Case studies such as the Veterans Heath Administration, which uses telecommunications and home health monitoring technology to keep tabs on more than 50,000 patients and reports patient satisfaction levels of 85 percent, are the exception rather than the rule. The majority of telemedicine implementations, research firm Gartner notes in its Hype Cycle for Telemedicine, are pilot projects, and few have made it to a "self-sustaining state where costs are offset by reimbursements and the clinical value obtained."
Case Study: Cisco Telepresence Lets Swiss Doctors Conduct Virtual Consultations
"Reimbursements" is the operative word. Of the 22 telemedicine technologies Gartner identified, lack of reimbursement is an adoption hurdle for at least seven—including some, such as home health monitoring and remote video consultations, which have a "high" benefit for healthcare organizations. (Without reimbursements, physician will just stick to office visits, for which they are reimbursed.) Licensing is another issue, as many physicians are licensed to practice in states that won't let them practice telemedicine across state lines.
Legislation Aims to Remove Telemedicine's Bureaucratic Barriers
That's where Rep. Thompson's bill, the Telehealth Promotion Act of 2012, comes into play. (The bill was introduced in the waning days of the 112th Congress, which ended January 3, 2013, and must therefore be reintroduced this year. It also refers to telehealth, an umbrella term that encompasses telemedicine, the use of technology in the practice of medicine, as well as more academic and research-oriented uses of technology in healthcare.) Linkous says the bill is attracting the support of both political parties—and, judging from what he heard at the Consumer Electronics Show, technology executives as well.
Among other proposals, the bill would no longer exclude from federal reimbursement medical services "furnished via a telecommunications system." In addition, physicians licensed in one state could treat patients anywhere in the nation, and accountable care organizations would be exempt from telemedicine fee-for-service restrictions.
Finally, hospitals would receive incentives to use telemedicine technology to lower readmissions. This is in line with healthcare reform, which is penalizing hospitals if too many patients are readmitted within 30 days. Hospitals that miss the mark could lose up to 1 percent of their annual Medicare reimbursement.
David Lindeman, director of the Center for Technology and Aging and co-director of the Center for Innovation and Technology in Public Health, both within the Public Health Institute, says that provision of healthcare reform is driving organizations to determine how they can ramp up their telemedicine efforts beyond the pilot stage and start to incorporate them into care management strategies. With that, says fellow CITPH co-director Andrew Broderick, comes cost savings as well as a more productive and more efficient clinical staff.
The PHI recently examined three case studies in telemedicine adoption. In all three cases, Broderick says, the pilot projects succeeded because leadership saw the value of expanding the use of technology to accomplish a larger strategic initiative, whether it's reduced readmissions, better patient engagement or improved long-term care for those with chronic conditions.
United Kingdom Also Experiencing Telemedicine Growing Pains
Strong leadership also drives telemedicine adoption in the United Kingdom. There, as in the United States, most pilots have been initiated at a local rather than national level, says Tola Sargeant, director of analyst firm TechMarketView. That said, those programs thrive when there's a close relationship between national and local health authorities, she adds. This is important; in Britain's healthcare system, telemedicine benefits National Health Service hospitals (which lower their costs as admission rates go down) at the expense of local social care providers (which take on the responsibility for home care).
One way the United Kingdom is advancing telemedicine is through private sector partnerships, which Sargeant describes as "telehealth as a service." Many NHS hospitals already outsource human resources and IT operations, so outsourcing telemedicine management for medical device installation or even triage services makes sense for some institutions.
Use of telemedicine technology is even more nascent in the United Kingdom than in the United States, and it's largely been incumbent vendors participating in early U.K. pilot projects, but Sargeant sees the market progressing with the spread of broadband, smartphones, tablet PCs, mobile applications and smart TV.
"We do see telehealth as something that becomes mainstream in the not too distant future, though more slowly than the government would like," Sargeant says. (Britain's 3millionlives campaign aims to attract three million long-term care patients to telemedicine technology by 2017, but it's an unfunded mandate and questions about how to deliver services have been left to local authorities.) "It's been talked about for a long time, but I think we're finally at a tipping point."
To Realize Savings, Bring Telemedicine to the Masses
Few deny the role that telemedicine can play in improving healthcare. It's spreading, too. Even now, with reimbursement and licensing questions still unanswered by federal legislation, 10 million Americans benefit from telemedicine, Linkous says. Many, for example, may not realize that one in 10 intensive care unit beds is monitored by an offsite teleICU.
Growth will continue. According to research firm InMedica, worldwide use of wireless remote monitoring devices is expected to increase six-fold by 2017, with the majority of users being monitored for chronic conditions such as diabetes, heart disease or mental illness following a hospitalization.
Meanwhile, researchers at Indiana University have found that artificial intelligence improves patient outcomes by simulating treatment paths and making adjustments as additional information becomes available. This type of mathematical modeling made it possible to identify more possible outcomes than a doctor could, researchers found.
However, the key to successfully using telemedicine isn't in the latest technology, or even in expanded broadband Internet connections, which the Federal Communications Commission continues to make a priority and which Sargeant says is important to the United Kingdom as well. As Linkous puts it, you may be using a fancy digital stethoscope, but "it's still a heart with basic, fundamental issues that you need to recognize and treat."
When telemedicine adoption hurdles pop up, Broderick suggests, they are 10 percent technology issues and 90 percent human or organizational factors. These include patient engagement, physician engagement, clinical workflows, business processes, return on investment and an overall difficulty in tracking and demonstrating both clinical and financial outcomes. (To that end, the Center for Technology and Aging has assembled an ADOOT Toolkit that outlines these challenges for providers looking to implement telemedicine.)
Ultimately, Linkous says, telemedicine will succeed when it transcends simply using technology to transforming care delivery in a meaningful way. Put another way, as InMedica notes, it's about encouraging patients—and their physicians—to use technology such as home health monitoring before they end up in the hospital in the first place. Only then can the healthcare industry begin to realize the value, financial and clinical, that telemedicine promises.
'Dr Graham Gumley, director of the Sihanouk Center of Hope hospital, said the telemedicine link will also make it possible to train doctors in Banlung without sending staff to the remote provincial capital.
The concept driving the telemedicine project is relatively new, and there may be more problems ahead, suggested an Internet expert based in Phnom Penh'.
Our US cities have low-income communities filled with citizens whose life expectancy is decades below our affluent communities and that is because all that Federal funding supposed to be allocated EQUALLY since all 99% of WE THE PEOPLE pay those Federal taxes supporting all health structures in our city and counties ----were denied those funds as they were misappropriated to building these global health system structures overseas in Foreign Economic Zones. US citizens are told this is all about helping the poor----the poor then becoming developing nation poor. We support bringing developed nation quality care to all global citizens-----want is being created is the OPPOSITE OF REAL US QUALITY HEALTH CARE AND KILLS EQUAL OPPORTUNITY AND ACCESS for our developed nation citizens who will never experience our US quality public health.
We also do not mean to under-estimate the abilities of our developing nation medical staff---from doctors to nurses to technicians and aids----what we do know is this-----they are not receiving the level of training as all Western nation citizens have known for centuries. As we see below there is already lots and lots of online medical training often rarely seeing actual medical schools-----
THIS IS WHERE GLOBAL TELEMEDICINE WILL GO-----IT WILL BE MORE AFFORDABLE HERE IN US TO CONNECT 99% OF WE THE PEOPLE TO THESE TELEMEDICINE MEDICAL GROUPS OVERSEAS.
What does a global citizen do when they are harmed, do not receive that health care promised, if they are wanting to know the health credentials behind those assigned to treat them? Global corporate tribunal courts exist only to provide legal justice between global corporations and the global rich----the 99% of citizens have no consumer rights in Foreign Economic Zones including US FOREIGN ECONOMIC ZONES.
What we are already seeing in UK and US is just what AFFORDABLE CARE ACT has as a goal------more and more criteria for denying access to ordinary care is being installed and broadening to exclude more and more population groups for more and more reasons. Now, if an American citizen is being pushed outside of these ordinary disease vector treatments-----will our developing nation 99% ever receive them? We know for sure the NEW INNOVATIVE BIOLOGICS ARE GOING FOR GLOBAL MARKET PRICE ONLY
'Treatment is too slow off the mark says leading cancer support charity Macmillan
But analysis by Macmillan Cancer Support showed 17 per cent were waiting beyond the official NHS target'................... 'Older cancer patients being written off instead of treated, says charity
Macmillan Cancer Support says some patients deemed too old for treatment and are not assessed on their overall fitness'.............................'Oncologists say the reduced funding, which took effect for Medicare on April 1, makes it impossible to administer expensive chemotherapy drugs while staying afloat financially.
Patients at these clinics would need to seek treatment elsewhere, such as at hospitals that might not have the capacity to accommodate them'.
Ratanakkiri ‘Telemedicine’ Puts Villagers’ Illnesses Online
by Matt McKinney | April 9, 2003
BANLUNG, Ratanakkiri province – An Internet link at Banlung’s main hospital opened Monday with the promise of allowing doctors there to ask doctors at hospitals in Phnom Penh and the US state of Massachusetts how best to treat their patients.
The project, which relies heavily on donated material, a satellite Internet link and agreements with hospitals in the US, makes it possible for the eight doctors at the Ratanakkiri Provincial Referral Hospital to call on professional colleagues at Massachusetts General, the Harvard Medical School and Phnom Penh’s Sihanouk Center of Hope.
Using digital pictures and e-mail descriptions of each patient, the doctors send e-mail to the distant hospitals and, hours later, receive second and third opinions on the best treatment.
“Ratanakkiri is very far from Phnom Penh, and every year we have to send patients to Vietnam for treatment,” said Ly Chanarith, vice director of the Ratanakkiri hospital, which sees 20 to 30 outpatients every day and 100 to 130 inpatients each year.
If doctors in Banlung were better informed and equipped to treat patients, they might not have to send people far away for treatment, he said.
It’s the second such project for Bernard Krisher, chairman of American Assistance for Cambodia and publisher of The Cambodia Daily, who opened a similar clinic in Preah Vihear province two years ago as a test of an Internet hospital.
“We hope to show that people don’t have to travel for good medical care,” Krisher said.
There are many bugs to be worked out. The Internet connection is slower than people would like. The hospital’s X-ray and ultrasound machines are old and produce only marginally helpful images.
For now, the doctors will take digital pictures of the X-rays and ultrasound images and send them on to Phnom Penh and Boston, Massachusetts, but in the future, there’s hope of more modern equipment capable of sending digital images from the X-ray and ultrasound machines.
That will take more funding than what’s been made available so far: A $40,000 grant from the Markle Foundation of New York City, a private foundation which supports health care projects. The telemedicine project also relies on the donated services of Telepartners, a service developed at Massachusetts General. The service has paying clients but offered to help Cambodia free of charge, according to Krisher.
Dr Graham Gumley, director of the Sihanouk Center of Hope hospital, said the telemedicine link will also make it possible to train doctors in Banlung without sending staff to the remote provincial capital.
The concept driving the telemedicine project is relatively new, and there may be more problems ahead, suggested an Internet expert based in Phnom Penh.
“Of course it’s a good idea, but not if the person at the other end does not really have a good understanding of the environment from which this message is coming,” said Norbert Klein, founder of the Open Forum of Cambodia. “Thus, in some cases, it can lead to real problems. It can lead to assistance, but it can also lead to big frustration. Medical equipment may not be available.”
And it’s expensive, he said. “Especially when you come to the cost-benefit analysis. It is not at all something that can be multiplied,” he said.
The telemedicine project will be supported in part from profits made from a Ratanakkiri weavers project, essentially a Web page hawking their blankets. A coffee farm in Ratanakkiri will also sell beans online, and a portion of the profits will go toward the telemedicine project, Krisher said.
On Monday, patient June Mot, 50, became one of the first to have her case file sent to doctors online. Though the widower and mother of three had never surfed the Internet or even seen a computer, she hoped that doctors armed with technology could prescribe a drug for her persistent cough.
A survivor of the Khmer Rouge regime, she said she was never sick then, and never would have sought treatment if she had been.
“If I was sick during the time of Pol Pot, I would not survive because Pol Pot does not like the sick,” she said. “Now I dare to tell people that I am sick.”
EVERGREEN HEALTH INSURANCE was to be that NGO----not public option but corporate non-profit that was going to support what will be those Maryland citizens with no health insurance-----employees of corporations killing health benefits------it was to enfold state and local public employee health plans into this SOCIAL BENEFIT health system tied to what was a state health system filled with fraudulent development----
We shouted from the very start---this will not end as being a benefit to anyone especially our low-income citizens needing health care access. It was always that same business development model throughout CLINTON/BUSH/OBAMA---and that is to move all funding to the top under the guise of helping the poor. So, Evergreen received all kinds of Federal, state, and local subsidy because it called itself SOCIAL BENEFIT---building all the infrastructure that will be needed for that BANKRUPTCY ENFOLDING INTO GLOBAL HEALTH CORPORATIONS.
BEILENSON as founder of Evergreen is of course one of those TOP HEALTH EXECUTIVES behind what is global health investment firms like this. These are clearly global health investment firms tied to global health systems made to look LOCAL.
'JARS Health Investments - CB Insights
May 1, 2017 ... JARS is an investment group formed and funded by some of Maryland's top healthcare executives specifically to support Evergreen Health's' ...
'The potential acquirers for the Baltimore insurer included Anne Arundel Health System, LifeBridge Health and JARS Health Investments — an investment group formed and funded by Maryland health care executives, including local entrepreneur Dr. Scott Rifkin'.
This was Maryland's one pretense of AFFORDABLE CARE social benefit health insurance to balance what were global health system insurance corporations on Maryland's 'state' private health system.
What we see with what is the earliest health institution mergers is this LIFEBRIDGE taking many of Maryland hospitals not taken by global Johns Hopkins and is likely tied to global health investment corporations----with University of Maryland Medical Systems taking the others-----we feel sure our public universities will be enfolded into GLOBAL JOHNS HOPKINS IVY LEAGUE HEDGE FUND----
'The group is led by Rifkin, who runs Pennsylvania nursing and rehabilitation provider Mid-Atlantic Health Care LLC.
LifeBridge Health oversees four Maryland hospitals, including Sinai Hospital in Baltimore. And Anne Arundel Health System is the parent of Anne Medical Center, headquartered in Annapolis'.
Mid-Atlantic Skilled Nursing Group Completes Sale-Leaseback with Sabra Health Care REIT
Signal Hill Capital Group LLC served as the exclusive financial advisor to the Sellers in a sale-leaseback of four skilled nursing facilities in the Mid-Atlantic region (the SNF Portfolio) to Sabra Health Care REIT, Inc. (Sabra) for $97.5 million in cash. The SNF Portfolio will be operated under a long-term lease with an initial yield on cash rent of 8.75%. The transaction closed August 1, 2011.
Based in Irvine, California, Sabra (NASDAQ: SBRA) is a self-administered, self-managed real estate investment trust (a REIT) that, through its subsidiaries, owns and invests in real estate serving the healthcare industry. Sabra leases properties to tenants and operators throughout the United States. As of June 30, 2011, Sabra's investment portfolio included 88 properties with a total of 9,793 licensed beds, spread across 20 states, and one mortgage note. The portfolio includes various types of assets such as skilled nursing facilities; combined skilled nursing, assisted living and independent living facilities; mental health facilities; an independent living facility; an acute care hospital and a continuing care retirement community.
This transaction was a collaborative effort between Signal Hill?s Real Estate Investment Banking team and Healthcare Investment Banking team. Combining the expertise of both practice areas enabled Signal Hill to provide the Sellers with superior execution and a successful outcome.
This is par for the course for Maryland PA predatory and profit-driven health care institutions getting worse as they are allowed to consolidate, merge with other national and international corporations-------
'For example, from 2012 to the present, CLS reports 38 complaints have been filed against Care Pavilion on Walnut Street — the most of any nursing home in Philadelphia. Granted, Care Pavilion is also the largest nursing home in the city with 400 beds. That’s nearly four times as many beds as other homes in the city, according to owner Dr. Scott Rifkin, who also said the facility has been a five star-rated building for most of the past three years'
Wasn't the Affordable Care Act sold on the premise of consumers being able to make educated health decisions? Of course it was and we KNEW THE DATA WOULD BE SKEWED..............
'But families can’t make sound decisions based on unreliable data'
'Yet, the Care Pavilion is still listed on the site as having an above average rating for quality measures'.
June 11, 2015
Under new directive, Pa. Dept. of Health dismissed 92 percent of Philly nursing home complaints
By Tony Abraham
Between 2012 and 2014, complaints of abuse or neglect filed against Philadelphia nursing homes had a 92 percent chance of being dismissed by the Pennsylvania Department of Health, according to a new report compiled by Community Legal Services. It also found DOH imposed far fewer monetary penalties during that time on nursing homes.
CLS has manually sifted through two years-worth of dense DOH nursing home investigation reports in an effort to get a comprehensive look at how many complaints were substantiated in Philadelphia nursing homes. The analysis concludes that of the 507 complaints filed against the city’s 46 nursing homes, only 43 investigations were substantiated by DOH.
In other words, only 8 percent of investigations prompted by complaints yielded a violation. Additionally, none of the required follow-up surveys in that period found violations to be persistent.
Enforcement actions have dropped dramatically in recent years, as illustrated by DOH’s own website. Civil monetary penalties (fines) decreased from an average of 44 per year from 2002 to 2011 to an average 8 from 2012 to 2014. Other enforcement actions, including downgrading facilities’ licenses to provisional and imposing bans on new admissions, had similarly steep declines. (Chart courtesy of Community Legal Services)
DOH is required by state and federal laws to complete annual inspections, investigate complaints and impose enforcements on facilities that fail to comply with regulations. Nursing homes are also required to report certain incidents, including negligent deaths, falls and patient elopements.
However, a state bulletin bearing DOH’s letterhead suggests the department began adopting a loose interpretation of those regulations in November of 2012.
Distributed to nursing home administrators across the state, the bulletin encourages facilities to refrain from reporting specific events to DOH. These events include medication errors and adverse reactions to medication, falls with injuries, inappropriate discharges and “misadventure with feeding tube, catheter, tracheotomy or life sustaining equipment.”
These are events that, needless to say, jeopardize the health and lives of nursing home residents. But according to state code, events of this caliber dwell in legal gray area. According to CLS, DOH claimed that Pennsylvania regulations do not pertain to specific incidents such as “falls with injuries,” “misadventure with life sustaining equipment” and “medication errors/adverse drug reactions causing serious injury.”
When such hazardous incidents are observed during annual DOH surveys or complaint investigations, they are grounds for violation. But if the extent of their harm is being played down, that might explain why 92 percent of complaints in Philadelphia are deemed unfounded.
If DOH is dismissing the vast majority of nursing home complaints in Philadelphia, are they treating complaints similarly in other counties?
Back in February of this year, Julie Lisiewski filed a complaint against Emmanuel Center for Nursing Rehab in Danville, Pennsylvania, for failing to detect her mother’s urinary tract infection on several occasions. The facility is in Montour County in the middle of the state. Though undetected infections are often a sign of neglect, the investigation was deemed unsubstantiated. It was not the first time Lisiewski had filed a complaint — she’s filed on at least four separate occasions at three different homes since 2011.
One month later, Lisiewski’s mother was diagnosed with sepsis. The illness, Lisiewski said, was triggered by an undetected UTI. After suffering from a reaction to medication, Lisiewski’s mother passed away.
The reaction to the medication was not reported. Lisiewski filed her last complaint one month after her mother passed. It was ruled unsubstantiated.
“When we make a complaint to the Department of Health, nothing happens,” said Lisiewski. “It’s over. It’s done. It’s dead. I can’t go back and say ‘You didn’t investigate this properly.’”
Downgrading injuries; downgrading penalties
By law, each violation must be assigned a characterization during the DOH survey. Each level of harm is designed to classify the severity and breadth of harm done to residents. These characterizations can range from low-risk “potential for minimal harm” to high-risk “severe harm.”
According to the CLS report, the DOH routinely minimizes these characterizations, which is evident in their review Philadelphia’s nursing home surveys. Between 2012 and 2014, DOH never classified a negligent death as severe harm in Philadelphia. Yet, a handful of negligent resident deaths within that same timeframe were classified as either minimal or actual harm.
CLS’ review of violation data includes the following instances of minimal harm, defined by DOH as causing “minimal discomfort to the resident”:
- A resident who set her head on fire at Inglis House (minimal harm, Jan. 27, 2012).
- A nurse at Oakwood Healthcare and Rehab who forged a prescription for morphine and stole it from the patient. The nurse then administered the drug to another patient, who was then hospitalized (minimal harm, March 18, 2013).
- A patient who required hospitalization after being dropped on his/her head by staff at Deer Meadows (minimal harm, Oct. 21, 2014).
- The failure of Tucker House nursing home staff to provide emergency care to a non-responsive patient, who subsequently died (minimal harm, Jan. 20, 2012).
On a statewide level, DOH issued an average of eight monetary penalties per year against nursing homes under the Corbett administration from 2012 to 2014, though in 2012 DOH issued no monetary penalties at all. That’s a significant decrease when compared to data from 2005 to 2011, when there were frequently between 30 and 44 monetary penalties issued per year.
NewsWorks wanted to offer Michael Wolf, who ran the Pennsylvania Department of Health under former Gov. Tom Corbett, a chance to respond to these figures. However we were unable to locate his new place of work since leaving office in January. Two messages left at a home phone number believed to be Wolf’s went unreturned. We also attempted to contact him through social media but did not hear back.
Unreliable data for families, the public
Mischaracterizations of harm don’t just interfere with the appropriate enforcements and risk residents’ health and livelihood. They stymie those who want to monitor enforcement. For families searching for a prospective facility, it is far harder to get an accurate understanding of a nursing home’s track record.
All that DOH survey data — whether gathered from an annual survey, complaint investigation, follow-up investigation or self-reported event — is required by federal law to be submitted to Centers for Medicare and Medicaid Services (CMS). CMS then plugs all of that information into their public Nursing Home Compare tool.
But families can’t make sound decisions based on unreliable data.
For example, from 2012 to the present, CLS reports 38 complaints have been filed against Care Pavilion on Walnut Street — the most of any nursing home in Philadelphia. Granted, Care Pavilion is also the largest nursing home in the city with 400 beds. That’s nearly four times as many beds as other homes in the city, according to owner Dr. Scott Rifkin, who also said the facility has been a five star-rated building for most of the past three years.
“Care Pavilion is one of the best facilities in the city,” Rifkin said. “The number of complaints has been lower than the community average if you adjust for the size of the building. Furthermore, none of those complaints turned out to be substantiated when the state came out and looked at them, as they do routinely.”
According to CLS, all but one complaint against Care Pavilion were dismissed by DOH. During that same period of time, the nursing home itself reported the death of an unsupervised patient who choked on a mustard packet and a dementia patient leaving unnoticed.
Neither of the two self-reported events were characterized as severe harm (despite both being caused by lack of supervision), so neither immediately show up on the CMS site. Neither do any of the dismissed complaints from the past three years. Yet, the Care Pavilion is still listed on the site as having an above average rating for quality measures.
“One of the major consequences of the Department of Health’s failure to properly investigate complaints and to enforce regulations is that the public becomes misinformed,” said Sam Brooks, a staff attorney at CLS and lead on this report. “The public relies on the Department of health to go out into nursing homes and to evaluate how safe they are, how clean they are, how well treated the patients are. When the Department of Health is not doing that, the public cannot make an informed decision about where to place themselves or loved ones.”
CLS says systemically reforming the way DOH manages public data, investigates abuse complaints, characterizes violations and makes the appropriate enforcements is crucial to the wellbeing of Pennsylvania’s elderly community — as well as the state'ss elderly-to-be. Could that reform come from the Wolf administration?
“These regulatory activities occurred during the previous administration,” said DOH Secretary Dr. Karen Murphy in a statement. “We are committed to ensuring that all facilities licensed and certified by the department meet state and federal quality and safety standards. The department evaluates every complaint brought to the department’s attention and follows up if indicated for evidence of compliance with state and federal regulations.”
“My concern is, what’s going to happen to our next generation? Will we be victims of the same fate?” asked Lisiewski. “I’d rather be dead than experience what my mom experienced, because she experienced elder abuse, and they got away with it. They got away with murder.”