By Sarah Jane Tribble
NPR, All Things Considered, October 17, 2023

Jason Bleak runs Battle Mountain General Hospital, a small facility in a remote Nevada gold-mining town that he describes as “out here in the middle of nowhere.”

When several representatives from private health insurance companies called on him a few years ago to offer Medicare Advantage plan contracts so their enrollees could use his hospital, Bleak sent them away.

“Come back to the table with a better offer,” the chief executive recalls telling them. The representatives haven’t returned.

Battle Mountain is in north-central Nevada, about a three-hour drive from Reno and four hours from Salt Lake City. Bleak (whose name is pronounced “Blake”) suspects insurance companies simply haven’t enrolled enough of the area’s seniors to need his hospital in their network.

October 15, 2023

Podcast host Joe Sparks wonders why the myth that the U.S. has the best health care system in the world persists, when all evidence points in the opposite direction.

“The one parameter where the U.S. is number one is cost,” he says. “There is no excuse for having the most expensive health care system in the world while getting inferior results.”

Additional episodes will be uploaded monthly. Subscribe in iTunes, or access a complete archive of the podcast, below.

https://medicareforallexplained.podbean.com

By Adam Gaffney, M.D., M.P.H.
The Nation, October 6, 2023

Ronald Reagan’s ascent to the presidency delivered a swift kick to the nation’s poor—especially those who had the misfortune to get sick. His administration’s 1981 budget imposed deep cuts on Medicaid, adding to financial pressures on states to narrow eligibility and punting some 600,000 beneficiaries out of the program early in the decade. A 1983 study in The New England Journal of Medicine examined the health consequences of Medicaid cuts in California, where coverage was eliminated for 270,000 people. One study subject who lost coverage died of a brain bleed (she couldn’t afford the blood pressure-lowering medications that might have prevented it), another of a stomach ulcer (he spit up blood for 10 days before seeking care, fearing ER bills), and a third of a probable heart attack (he ran out of heart medications which he couldn’t afford to refill). This episode is of more than historic interest: We are now about six months into our own version of what experts are calling a great “Medicaid unwinding.”

In April, the pandemic-era “continuous coverage provision”—which compelled states to keep Medicaid beneficiaries continuously insured for the duration of the Covid-19 public health emergency, greatly boosting enrollment—expired. This has already led to the disenrollment of nearly 8 million beneficiaries from the program, with predictable results. For example, Patricia Jones, a 62-year old West Virginia woman with heart problems and a recent bloodstream infection, was recently dropped from Medicaid because the $1,765 a month she was getting in disability survivor’s benefits after her husband died in March was $149 too high to qualify, The Washington Post recently reported. (She has yet to find alternative coverage.) Experts predict that as many as 24 million enrollees might lose their coverage by the time the unwinding is done.

These giant numbers dwarf the coverage losses of the early 1980s, and widespread harm is sure to follow. But the so-called “Medicaid unwinding” isn’t as new as it may seem. Before the pandemic, large numbers of people lost Medicaid coverage every year, thanks to shifting eligibility at the margins and administrative snafus. This feature—inherent to many means-tested programs—has always compromised coverage and caused suffering for those who depend on this critical program. Such discontinuities in coverage are all too common in the fragmented American insurance system, and they undermine the very essence of what medical care can do.

I practice ICU medicine in Massachusetts, a state where only 2.5 percent of residents are uninsured—and which might hence be counted as the ultimate American health coverage success story. I no doubt see less medical deprivation than my colleagues in states like Texas, where the uninsured rate hovers around 18 percent. Still, I see how discontinuities in coverage entrenched by a patchwork system affect my patients’ lives. Those gaps can precipitate potentially deadly ruptures of care. Inability to fill an insulin prescription because of a lapse or change in coverage, for instance, can provoke acute, even life-threatening diabetic emergencies that land a patient in the ICU.

Even when coverage interruptions aren’t acutely life-threatening, they invariably detach patients from the healthcare system and erode the ongoing mutual project that ought to be the bedrock of effective medical care. Most of the benefits of modern healthcare, after all, emerge not from emergency care provided in places like ERs or ICUs, as important as that is. Rather, health is protected through long-standing therapeutic relationships between patients and primary care physicians that allow medical problems to be recognized and chronic problems carefully managed. Patients with untreated high blood pressure who are excluded from such care, for instance, may experience a slow and silent deterioration of their kidney and heart function—until the day fluid fills their lungs and they wind up in an ICU seeing someone like me. Ongoing relationships with trusted primary care providers can likewise help assure many of the safety—or the urgency—of interventions like Covid-19 vaccination. Those excluded may pay the price, winding up with severe, life-threatening Covid pneumonia in the ICU.

Numerous studies bear this out. One study, for instance, found that about a quarter of low-income individuals experience coverage disruptions over the course of a year; individuals with such interruptions in coverage are more likely to have to change doctors or prescriptions, to skip doses of their medications, to go the ER, or to report worse health compared to those with continuous coverage. Even though the Covid-19 vaccines were free, colleagues and I found that health coverage and access to care are associated with higher booster uptake. Another of our studies identified a sharp rise in hospitalizations for diabetic emergencies when teens became young adults in the US—a time of frequent coverage disruptions—but not in Canada, where insurance is universal and seamless across the life course.

Other work highlights the critical importance of a relationship with a primary care physician—precluded by lapses or even changes in coverage. A clinical trial published decades ago found that older veterans who were randomized to “continuous” primary care (i.e., seeing the same provider regularly) spent fewer days in the hospital and the ICU than those who were randomized to discontinuous care. This year, a quasi-experimental study found that when Medicare beneficiaries lose their primary care physician, they experience a 3 percent increase in hospital admissions and a jaw-dropping 4 percent increase in mortality. Medical care that is disjointed and discontinuous, that is to say, may not amount to care at all.

Since its inception, Medicaid has been on the front lines of the battle for an American welfare state. In 1964, Democrats swept the midterm elections, giving them the congressional majorities they needed to finally realize long-fought-for healthcare reform. The following year, President Lyndon Johnson signed both Medicare and Medicaid into law. Medicare was designed in the universal social insurance mold: It provided something of a national statuary right to healthcare for almost all older Americans. Medicaid, in contrast, entered the world as a means-tested program, partially funded (and controlled) by states, with eligibility initially generally confined to the so-called “categorically needy”—individuals who were not merely poor but who also participated in certain welfare programs. While Medicaid’s out-of-pocket payments are generally low or even zero, the program provides access to a narrower scope of providers compared to traditional Medicare. Medicaid is also subject to the whims and prejudices of state lawmakers, who have significant latitude to cut eligibility criteria or benefits, sometimes cruelly. Still, since its inception, Medicaid program has greatly expanded, and improved—particularly as a result of the President Barack Obama’s Affordable Care Act, which was designed to make all low-income individuals eligible.

The expansion of Medicaid has had large, extensively documented benefits: it improves access to healthcare services and health itself, and, indeed, has saved numerous lives. Still, the much-needed rise in participation achieved by the continuous coverage provision—enrollment rose from 71 million to 94 million from January 2020 to April 2023—was at the same time a testament to how much “churn,” or movement in-and-out of the program, occurs outside plague years when such protections are not in play. Small increases in family income can render someone ineligible for Medicaid. Moving states can provoke disenrollment. There are sometimes burdensome administrative hurdles to enrollment, which can be particularly challenging for workers with unsteady employment or income or otherwise tenuous life circumstances. Annual eligibility redeterminations can result in disenrollment if forms are not properly completed, or when they are sent by state agencies to the wrong address.

A string of news stories before the pandemic revealed how common such disenrollment normally is, at least in many states. In 2018, some 70,000 people, mostly children, were dropped from Missouri’s Medicaid program, mostly “because they failed to reply to a mailed renewal form,” according to NPR. A 2019 story in The Texas Tribune described how the state used an automated system to check family income multiple times a year to validate children’s ongoing eligibility, which caused thousands of children to lose coverage every month, sometimes in error. The same year, The Tennessean reported that 120,000 had been dropped from Tennessee’s Medicaid program since 2017: “Nearly all of these disenrollments occurred when the state government processed insurance renewals with an outdated system of paper forms and postal mail,” the paper noted. Similarly, in Idaho, a large number of children were dropped from Medicaid in the years before the pandemic thanks to a more onerous state enrollment system that was at least in part driven by guidance from the Trump administration, ProPublica found. None of these are aberrations: one recent study found that Medicaid participants have a roughly 20 percent chance of having a lapse in coverage over a given two-year period.

Just how many victims of today’s “Medicaid unwinding” will find alternate coverage and how many will remain uninsured isn’t yet clear. But there’s little doubt that many will be harmed. Research has found that Medicaid expansion saves lives; it is a reasonable extrapolation of these findings to say that contraction will take some.

The continuous coverage provision should be seen as two things at once: a successful example of what action born of an emergency can achieve, but also an indictment of the pre-pandemic status quo. Uniquely among high-income nations, we allow our residents to periodically, and protractedly, lose healthcare, and to suffer as a result. Achieving the goal of universal coverage is a moral imperative. Yet any vision of universal healthcare worthy of the name must provide seamless, cradle-to-grave healthcare to everyone. Without continuity, there is, far too often, no care at all.

Dr. Adam Gaffney is a critical care physician, an assistant professor at Harvard Medical School, and a past president of Physicians for a National Health Program.

https://www.thenation.com…

By Jake Johnson
Common Dreams, October 4, 2023

A report published Wednesday estimates that privately run, government-funded Medicare Advantage plans are overcharging U.S. taxpayers by up to $140 billion per year, a sum that could be used to completely eliminate Medicare Part B premiums or fully fund Medicare’s prescription drug program.

Physicians for a National Health Program (PNHP), an advocacy group that supports transitioning to a single-payer health insurance system, found that Medicare Advantage (MA) overbills the federal government by at least $88 billion per year, based on 2022 spending.

That lower-end estimate accounts for common MA practices such as upcoding, whereby diagnoses are piled onto a patient’s risk assessment to make them appear sicker than they actually are, resulting in a larger payment from the federal government.

But when accounting for induced utilization—”the idea that people with supplemental coverage are likely to use more health care because their insurance pays for more of their cost”—PNHP estimated that the annual overbilling total could be as high as $140 billion.

“This is unconscionable, unsustainable, and in our current healthcare system, unremarkable,” says the new report. “Medicare Advantage is just another example of the endless greed of the insurance industry poisoning American healthcare, siphoning money from vulnerable patients while delaying and denying necessary and often lifesaving treatment.”

Even if the more conservative figure is accurate, PNHP noted, the excess funding that MA plans are receiving each year would be more than enough to expand traditional Medicare to cover dental, hearing, and vision. Traditional Medicare does not currently cover those benefits, which often leads patients to seek out supplemental coverage—or switch to an MA plan.

The Congressional Budget Office has estimated that adding dental, vision, and hearing to Medicare and Medicaid would cost just under $84 billion in the most costly year of the expansion.

“While there is obvious reason to fix these issues in MA and to expand traditional Medicare for the sake of all beneficiaries,” the new report states, “the deep structural problems with our healthcare system will only be fixed when we achieve improved Medicare for All.”

Properly spent, these overpayments could make a huge difference in the lives of Medicare beneficiaries. We could either:

💰 Totally eliminate Medicare Part B premiums

💊 Fund the entire Medicare Part D prescription drug program

🦷 Establish dental, hearing, and vision coverage pic.twitter.com/Q2zEBMMnaZ

— Physicians for a National Health Program (@PNHP) October 4, 2023

Bolstered by taxpayer subsidies, Medicare Advantage has seen explosive growth since its creation in 2003 even as it has come under fire for fraud, denying necessary care, and other abuses. Today, nearly 32 million people are enrolled in MA plans—more than half of all eligible Medicare beneficiaries.

Earlier this year, the Biden administration took steps to crack down on MA overbilling, prompting howls of protest and a furious lobbying campaign by the industry’s major players, including UnitedHealth Group and Humana. Relenting to industry pressure, the Biden administration ultimately agreed to phase in its rule changes over a three-year period.

Leading MA providers have also faced backlash from lawmakers for handing their top executives massive pay packages while cutting corners on patient care and fighting reforms aimed at rooting out overbilling.

As PNHP’s new report explains, MA plans are paid by the federal government as if “their enrollees have the same health needs and require the same levels of spending as their traditional Medicare counterparts,” even though people who enroll in MA plans tend to be healthier—and thus have less expensive medical needs.

“There are several factors that potentially contribute to this phenomenon,” PNHP’s report notes. “Patients who are sicker and thus have more complicated care needs may be turned off by limited networks, the use of prior authorizations, and other care denial strategies in MA plans. By contrast, healthier patients may feel less concerned about restrictions on care and more attracted to common features of MA plans like $0 premiums and additional benefits (e.g. dental and vision coverage, gym memberships, etc.). Insurers can also use strategies such as targeted advertising to reach the patients most favorable to their profit margins.”

A KFF investigation published last month found that television ads for Medicare Advantage “comprised more than 85% of all airings for the open enrollment period for 2023.”

“TV ads for Medicare Advantage often showed images of a government-issued Medicare card or urged viewers to call a ‘Medicare’ hotline other than the official 1-800-Medicare hotline,” KFF noted, a practice that has previously drawn scrutiny from the U.S. Senate and federal regulators.

PNHP’s report comes days after Cigna, a major MA provider, agreed to pay $172 million to settle allegations that it submitted false patient diagnosis data to the federal government in an attempt to receive a larger payment.

Dr. Ed Weisbart, PNHP’s national board secretary, told The Lever on Wednesday that such overpayments are “going directly into the profit lines of the Medicare Advantage companies without any additional health value.”

“If seniors understood that the $165 coming out of their monthly Social Security checks was going essentially dollar for dollar into profiteering of Medicare Advantage, they would and should be angry about that,” said Weisbart. “We think that we pay premiums to fund Medicare. The only reason we have to do that is because we’re letting Medicare Advantage take that money from us.”

https://www.commondreams.org…

By Matthew Cunningham-Cook and Lucy Dean Stockton
The Lever, October 4, 2023

The federal government is losing as much as $140 billion per year by subsidizing private Medicare Advantage plans, according to a bombshell new report. In the groundbreaking investigation, health care researchers identified the four major ways that private insurers systematically exploit the taxpayer-funded national health insurance program while denying care to the nation’s most vulnerable patients.

The researchers additionally found that seniors could save over $1,800 in annual fees taken from their Social Security checks if the government redirected what it spends subsidizing Medicare Advantage plans to instead reduce premium costs. Under the current arrangement, “traditional” Medicare pays about $12,000 a year to private Medicare Advantage insurers for every patient whose care they “manage.”

Medicare Advantage insurers — which include UnitedHealth Group, Humana, Cigna, and Blue Cross Blue Shield — are profiting at the expense of ordinary seniors, 40 percent of whom are completely dependent on their Social Security benefits, which average about $1,600 per month after Medicare premiums are taken out.

“Insurers are quietly plundering the Medicare trust fund for their own profits and compromising the health of senior citizens and [people with] disabilities,” said Ed Weisbart, a family medicine physician who is the secretary of Physicians for a National Healthcare Program (PNHP), a single-payer advocacy group that produced the report.

Medicare, the public health insurance for seniors and people with disabilities, is one of the most popular and effective social programs in the country. The program is funded by taxpayer money and keeps costs low by setting fixed prices with health care providers.

Medicare Advantage lets private insurance plans step in as a middle man. When the program was established in its current form in 2003, its proponents argued it would help save the government money on Medicare spending. However, research from the Medicare Payment Advisory Commission (MedPAC), an independent agency that advises Congress on Medicare, shows that the program has not yielded savings in the two decades since it was established.

Medicare Advantage plans receive a flat payment for the care they provide, strongly incentivizing the insurers sponsoring the plans to ration care — leading to high rates of wrongful claim denials, worse health outcomes, and costly administrative headaches for providers.

These private plans have been under fire for the rate at which they deny patient care. As The Lever reported, these claims have a devastating cost to health outcomes but frequently save insurance companies money as patients forgo treatments they cannot afford.

Since then, claim denials have only increased. A report from the KFF (formerly known as the Kaiser Family Foundation), a major foundation that studies health policy issues, found that two million prior authorization requests were denied by Medicare Advantage in 2021 — significantly higher than the rates for traditional Medicare.

Since 2007, the share of beneficiaries enrolled in Medicare Advantage plans has tripled, far outpacing the growth of traditional Medicare enrollment.

Many people leave traditional Medicare for private plans, and once they do, an administrative barrier makes it difficult to return. That’s because while Medicare covers 80 percent of patients’ health care costs, the last 20 percent are usually covered by the individual or a supplementary plan called Medigap. But in most states, when someone leaves Medicare Advantage, often due to illness necessitating broader coverage networks, Medigap insurers can deny future coverage — effectively making their return to traditional Medicare impossible.

As of this year, Medicare has reached a turning point: Medicare Advantage now manages care for over half of all eligible beneficiaries.

As patients are joining these for-profit plans, providers are leaving. Scripps Health, a major health care provider in San Diego, announced in late September that it would decline most Medicare Advantage plans moving forward, because of their practices.

Scripps CEO Chris Van Gorder told MedPage Today, “We are a patient care organization and not a patient denial organization and, in many ways, the model of managed care has always been about denying or delaying care — at least economically.”

Van Gorder explained that the private plans’ routine denials forced Scripps’ medical groups to operate at a $75 million annual loss, adding: “That is why denials, [prior] authorizations, and administrative processes have become a very big issue for physicians and hospitals.”

Scripps is one of many health care groups around the country dropping Medicare Advantage plans. In the last month, medical groups in Ohio, Virginia, Oregon, Missouri, Oklahoma, and South Dakota have all terminated or partially terminated their contracts with Medicare Advantage plans, citing delayed reimbursements and administrative conflicts.

In August, Humana, which controls 18 percent of the Medicare Advantage market, posted a 38 percent increase in its profit from the same quarter in 2022, earning $957 million in one quarter alone. UnitedHealth — the largest Medicare Advantage insurer, controlling 29 percent of the market — posted $8.1 billion in profits, up $1 billion, or 14 percent, from the same period the prior year. The enormous profits are driven by the substantial subsidies that Medicare Advantage offers the insurers.

Taking Advantage

The report from PNHP is among the first to fully categorize the predatory costs that the private insurance plans impose on Medicare. It spells out four key ways that Medicare Advantage games the Medicare system for profit.

Favorable selection and deselection:

Researchers found that Medicare Advantage plans actively seek out healthier patients, targeting their marketing towards a healthier demographic in a process called “favorable selection” and “favorable deselection.”

While traditional Medicare accepts anyone who is eligible, private plans aggressively market to a healthier population — and when high-need patients find that their Medicare Advantage plans won’t cover their health care costs, they often try to return to traditional Medicare.

This means that low-needs patients turn to Medicare Advantage, taking Medicare funding with them, while high-needs patients further strain the traditional Medicare system with elevated care costs.

The flat rates that the government pays to Medicare Advantage insurers is based on the costs of traditional Medicare participants, but traditional Medicare participants tend to be sicker. Research shows that patients tend to switch to traditional Medicare as they get sicker due to Medicare Advantage plans’ narrow provider networks and restrictions on care.

The PNHP report cites a 2019 study from KFF, finding that similarly situated seniors who switched to Medicare Advantage plans received $1,253 in less care in a given year than those who had stayed in traditional Medicare.

MedPAC found in June that favorable selection for a healthier Medicare Advantage population resulted in 11 percent lower costs for Medicare Advantage plans, even as insurers get paid on the basis of the traditional, higher-need Medicare population. The report estimates that these overpayments cost Medicare $44-56 billion annually.

Upcoding:

Even though beneficiaries enrolled in Medicare Advantage plans tend to be healthier, the private plans systematically make their patients appear sicker to juice more profits out of Medicare.

As part of a complex formula, Medicare Advantage insurers receive “risk adjustment” payments when their patients have more severe conditions, strongly incentivizing the private plans to create records that indicate having sicker patients, a practice known as “upcoding.”

As The Lever covered in May, this fraudulent practice leads to $20 billion in additional spending per year — and generates more profits for insurers. The PNHP report cites a 2021 study showing that risk adjustment payments are 20 percent higher in Medicare Advantage than traditional Medicare.

Quality benchmarks and county bonuses: 

Currently, Medicare provides bonuses to Medicare Advantage plans based on the locations they cover, supposedly to ensure equal geographic access to coverage. But as MedPAC noted in its 2023 report, these payments “are not necessary for maintaining affordable supplemental coverage” and “fail to capture savings for the Medicare program.”

These payments are combined with bonuses that Medicare Advantage insurers receive for being higher “quality.” Over half of all plans currently receive over four stars out of five, making them eligible for “quality” payments — and the rating system is plagued with limited information, making it a poor performance measure.

A June 2023 report from the Urban Institute found that “after weighting, about two-thirds of a contract’s star rating is determined by beneficiary experience and administrative effectiveness,” and that “measures of beneficiary experience do not permit meaningful distinctions across [Medicare Advantage] contracts.” The report added, “Administrative effectiveness measures do not target important deficiencies regulators have identified within [Medicare Advantage] organizations.”

The PNHP report estimates that quality benchmarks and county bonuses may amount to $24-28 billion in annual overspending.

Induced utilization:

In traditional Medicare plans, only 80 percent of health care costs are covered — and 86 percent of traditional Medicare beneficiaries have some type of supplemental coverage, whether from a Medigap plan, an employer-sponsored health plan for retirees, or another form of supplementary coverage to cover the last 20 percent.

Medicare Advantage participants do not need supplementary coverage.This is an essential feature of the marketing of Medicare Advantage plans: Seniors accept the costs of narrow networks and managed care in exchange for not needing to pay the cost of supplementary coverage.

But Medicare makes spending assumptions for Medicare Advantage on the basis of significantly more comprehensive coverage than what the plans actually offer. That means that Medicare Advantage plans are paid using assumptions that they provide more care than they actually do.

The report estimates that these costs amount to $36 billion per year.

Experts say that the $140 billion these predatory practices are costing the government could instead go to reducing costs for seniors.

“Medicare Advantage overpayments could be rediverted into paying everybody’s [traditional Medicare] premiums, the money they’re paying every month out of Social Security,” said Weisbart, from PNHP.  “It’s going directly into the profit lines of the Medicare Advantage companies without any additional health value.”

He added, “If seniors understood that the $165 coming out of their monthly Social Security checks was going essentially dollar for dollar into profiteering of Medicare Advantage, they would and should be angry about that. We think that we pay premiums to fund Medicare. The only reason we have to do that is because we’re letting Medicare Advantage take that money from us.”

Analysts from Moody’s Investor Service, a bond credit rating agency, suggested in March that they could expect slower growth in the overall insurance industry compared to 2022, but that they “expect continued growth in Medicare Advantage.”

https://www.levernews.com…