PNHP

Workers not prepared financially for unexpected health costs

Workers not prepared financially for unexpected health costs

American Workers on an Uphill Road with Consumer-Driven Health Care

Aflac
2013 Aflac WorkForces Report, April 24, 2013
 
New Aflac survey reveals employees are not prepared for increased costs, may not want control and lack education   
 
The 2013 Aflac WorkForces Report is the 3rd annual Aflac employee benefits study examining benefit trends and attitudes.

Not Prepared Financially

*  Only 24 percent of workers completely agree or strongly agree they will be financially prepared in the event of an unexpected emergency or serious illness.

*  Further, 46 percent of employees have less than $1,000 to be able to pay for out-of-pocket expenses associated with an unexpected serious illness or accident, and 25 percent of employees have less than $500.

*  Four-in-ten (40 percent) workers would have to borrow from their 401(k), friends and family to pay for out-of-pocket expenses associated with an unexpected serious illness or accident; 28 percent would have to use a credit card.

Press release:
http://www.aflac.com/us/en/docs/insights/aflac_prtemplateawr2013.pdf

Fast Facts:
http://www.aflac.com/aflac_workforces_report/2013/fast_facts.aspx

And…

The Center for Consumer Information & Insurance Oversight
Centers for Medicare and Medicaid Services

Section 1402 of the Affordable Care Act requires reductions in the maximum out-of-pocket limits on silver plans for individuals with household incomes between 100 and 400 percent of the FPL. However, the statute also requires the Secretary to ensure that the reductions in the maximum out-of-pocket limits do not cause the AVs (actuarial values) of these silver plan variations to exceed certain levels.

For reasons described in more detail below, we do not plan to reduce the maximum out-of-pocket limits for individuals with income between 250 and 400 percent of FPL.

http://cciio.cms.gov/resources/files/Files2/02242012/Av-csr-bulletin.pdf

Comment:

By Don McCanne, M.D.

With a major trend expanding in the direction of employer-sponsored consumer-driven health care, this new Aflac report shows that workers are not ready for the change. If you look only at the financial challenge, workers may never be ready. They cannot afford to pay the out-of-pocket expenses that they would face should they or their families develop significant medical problems.

Although the Aflac study was limited to employer-sponsored benefit programs, most people purchasing plans in the new state insurance exchanges also will be selecting plans that use high-deductibles – the defining characteristic of consumer-driven health plans.

The Affordable Care Act (ACA) does require reductions in out-of-pocket expenses for individuals with household incomes between 100 and 400 percent of the federal poverty level (FPL), but another ACA requirement prohibits the covered silver plans from having an actuarial value over 70 percent (the percent the plan pays on average) for individuals with household incomes over 250 percent of FPL ($27,925 for an individual). Since it is impossible to keep the actuarial value down at 70 percent if out-of-pocket expenses are subsidized, it was decided to eliminate out-of-pocket support for individuals above 250 percent of FPL.

Some workers will benefit from employer contributions to health spending accounts (HSAs and HRAs), just as some individuals will benefit from out-of-pocket subsidies in the exchanges. In either instance, it can be anticipated that far too many still will not be prepared financially for unanticipated medical costs, just as the Aflac study reported.

Newer employer-sponsored plans and plans under ACA are moving in the wrong direction. We need a program that removes financial barriers to care, not plans that erect them. All you have to do is read the 16 page CCIIO/CMS bulletin on actuarial value and cost-sharing reductions (link above) to see how ridiculously complicated and irrational we made this system.

We really do need a single payer system. Then everyone would be prepared financially in the event of medical need.

Group forgives $1 million in doctor bills

The nonprofit bought up the medical debts owed by more than 1,000 residents in the Louisville area

By Jere Downs, The (Louisville, Ky.) Courier-Journal
USA Today, April 23, 2013

LOUISVILLE, Ky. — A New York-based nonprofit says it has bought up more than $1 million in medical debts owed by more than 1,000 people in the Louisville area, as part of a protest of the credit industry.

The Rolling Jubilee Fund, founded by Occupy Wall Street protesters, said it has forgiven the debts, which ranged from $25.50 to $8,790 — so they no longer have to be paid.

“We believe that no one should have to go into debt for the basic things in our lives, like health care, housing and education,” said Thomas Gokey, the organization’s vice president.

The goal of the project, which began last fall, is to “to buy and abolish personal debt,” said Gokey, who argues there is a double standard with debt — Wall Street banks that owe billions of dollars are bailed out, while “the same options are not available for the 99 percent.”

The Rolling Jubilee said it used donations from people sympathetic to their cause to purchase the debt, which was owed to local doctors and then sold on the credit market after the doctors were unable to collect. The group said it bought the debt from a debt broker and a collection agency in the Louisville area.

But while the organization said it believes in “transparency,” it declined to name the debt brokers, or release the names of any of the 1,064 people whose debt they say is being forgiven, citing credit industry practice and privacy laws.

The group’s total cost to retire the debt was $22,000. Businesses that can’t collect debts owed them often sell them to debt collectors and other third parties for pennies on the dollar.

Certified letters were mailed Friday to those whose debt had been purchased, Gokey said.

“We are committed to protecting the privacy of debtors and it would be irresponsible of us to make that info public,” he said. “We are hoping some of the 1,064 people will step forward.”

Whitney Bishop, who runs the nonprofit Southern Indiana Asset Building Coalition, a local financial counseling nonprofit agency, isn’t involved in the project but said any relief will be welcome to families burdened by medical debt.

“This is so exciting,” he said. “It’s like Robin Hood.”

Occupy Wall Street protesters in New York City began protesting growing household debt and U.S. wealth inequality in late 2011, drawing national attention and spawning similar protests in other cities, including Louisville. The idea to buy and forgive debt arose in the Wall Street encampment last year.

A nonprofit offshoot of Occupy Wall Street called Strike Debt created The Rolling Jubilee Fund nonprofit, which runs the debt payment program. The Jubilee in the program’s name derives from a religious concept in which debts are absolved upon repentance.

Since November, Strike Debt has raised more than $500,000 for the Rolling Jubilee Fund, according to its website. The first place it purchased debt was in upstate New York, where it spent $7,100 to absolve $100,000 in medical bills owed by 44 patients in the Utica area.

About half the letters sent to the debtors came back as undeliverable and not a single person has come forward there to comment on the organization’s effort, Gokey said.

Louisville was chosen as Rolling Jubilee’s second target because the group got a great deal on overdue debt here, Gokey said.

The relief offered by the Rolling Jubilee program of Strike Debt is scant compared with the mountain of unpaid medical debt in the nation, the group notes. In 2011 alone Norton Healthcare reported $1.6 billion in net revenue, with $54 million reported as “bad debt,” and $81 million that was absorbed as “charity” care and not reimbursed, spokesman Thomas Johnson said.

The letters Rolling Jubilee mailed to debtors in the Louisville area state “BALANCE DUE: $0.00”

“You no longer owe the balance of this debt. It is gone, a gift with no strings attached,” according to a copy of the letter provided by the organization.

The letter goes on to invite debtors to share their story with Strike Debt.

Consumers can take the letter from Strike Debt as proof the debt has been resolved should they ever be contacted by a collection agency, Rolling Jubilee said.

Half of U.S. households have poor credit scores because they are delinquent on their bills, according to the Assets & Opportunity Scorecard, an annual report of the nonprofit CFED, the Corporation for Enterprise Development.

At the same time, the debt buying industry has grown as credit card companies, banks and others have sought to unload overdue accounts from their books and recover from the recession.

Those who buy the debts usually then try to profit by collecting more than they paid for the debt.

That has sometimes led to complaints about abusive collection practices, particularly as bankruptcies and home foreclosures spike as a result of the recession. In a January report on the growing debt collection industry, the Federal Trade Commission recently called for greater scrutiny and increased protection for consumers.

While Rolling Jubilee’s approach is unorthodox, any relief from debt is welcome, consumer advocates say.

“Medical debt is the most catastrophic debt that people deal with — the bills, for an individual, are astronomical,” said Kathy Virgallito, spokesperson for Apprisen, a national nonprofit credit counseling agency with offices in Kentucky and Indiana.

Medical debt is the leading cause of personal bankruptcy, according to a study by Harvard University Law School.

Burdensome medical costs hurt people who are already sick and hinder delivery of care to many more, said Garrett Adams, a Louisville physician and immediate past president of Physicians for a National Health Program, a nonprofit group of 18,000 medical professionals who advocate for universal health care.

Health care costs are “such a disaster, a personal and individual disaster for so many Kentuckians and people in Indiana,” Adams said, adding the Rolling Jubilee Fund “is truly a wonderful thing.”

http://www.usatoday.com/story/news/nation/2013/04/23/group-forgives-1-million-in-doctor-bills/2108355/

Hospitalization OK for Psych Patients Can Take Hours

Phone time to get insurance authorization adds up to a million hours a year for psychiatrists nationwide

By HealthDay News
U.S. News and World Report, April 24, 2013

U.S. psychiatrists spend a total of 1 million hours on the phone each year getting insurance companies to approve hospitalization for patients with severe mental illnesses, a new study reports.

For the study, which was published April 23 in the journal Annals of Emergency Medicine, researchers looked at psychiatrists in the Boston area and found that they spent an average of 38 minutes per patient on the phone getting insurance authorization.

About one in 10 cases took more than an hour to get approval, and one case took up five hours of the psychiatrist’s time, the investigators found.

Each year in the United States, there are about 1.6 million psychiatric admissions for patients with private insurance. An average of 38 minutes of phone time per patient to get insurance authorization works out to about 1 million hours of “wasted” time for psychiatrists nationwide, according to the news release from the Physicians for a National Health Program.

The three-month study did not include uninsured patients or those covered by Medicare, which does not require prior authorization.

Most of the patients that required hospitalization had been deemed suicidal or, in some cases, posed a danger to others. The time spent obtaining insurance authorization delayed care for the patient in need and prevented psychiatrists from seeing other patients, the study authors noted. Only one of the 53 requests for authorization was denied, they pointed out.

The average time that patients spent in an emergency department (ED) awaiting hospital admission was 8.5 hours. The shortest wait was three hours and the longest was 20 hours, according to the study findings.

Mental health disorders affect nearly one-quarter of American adults a year, but less than one-third of them receive psychiatric care, according to background information in the news release.

“Society pays for inadequate psychiatric care; more than half of all prison inmates and a third of all homeless people are mentally ill. Massachusetts is considered a model for health reform, yet we found that seriously ill patients routinely spent hours stranded in the ED due to insurance bureaucracy. The hours psychiatrists spend obtaining those authorizations could be far better spent treating our patients,” study lead author Dr. Amy Funkenstein, a child psychiatry fellow at Brown University, said in the news release.

She led the study while she was a psychiatric resident at Cambridge Health Alliance (CHA) and Harvard Medical School.

Study senior author Dr. J. Wesley Boyd, attending psychiatrist at CHA, said that “private insurers are obstructing care by requiring authorizations before a qualified psychiatrist can hospitalize a dangerously ill patient. With doctors, nurses and emergency departments already overburdened, adding a time-consuming bureaucratic task that doesn’t help patients is unconscionable,” he said in the news release.

“Insurers hope that clinicians will be so hassled by authorization procedures that they won’t seek admission for their patients, saving insurance companies money,” Boyd, who is also an assistant clinical professor of psychiatry at Harvard Medical School, suggested in the news release. “Placing profits ahead of the health of patients when mental illness makes them vulnerable is immoral. A single-payer Medicare-for-all health care system would represent a great leap forward for patients and providers alike.”

More information: The National Alliance on Mental Illness has more about treatments and services for mental illness.

http://health.usnews.com/health-news/news/articles/2013/04/24/hospitalization-ok-for-psych-patients-can-take-hours

How long it takes to get insurance OK to admit psychiatric patients

By Mary MacVean
Los Angeles Times, April 24, 2013

Psychiatrists spent an estimated 1 million hours on the phone getting insurance authorizations to admit people to hospitals – time the lead author of a study on the matter says could be better spent helping patients.

And perhaps time the patients might be suffering needlessly.

Researchers tallied over three months the time it took to get insurance OKs for patients in the emergency department of Cambridge Health Alliance in Massachusetts to see whether that time added to the overall time the patient spent waiting.

They recorded data for 53 people, ages 7 to 68. Most of them were suicidal, the researchers said. They had different insurance coverage, but in all but one case authorization was granted.

The average time to get it was 38 minutes, according to the study published Tuesday in the Annals of Emergency Medicine. For about 10% of patients, authorization took an hour or more, the researchers said.

“Our findings indicate that the need to obtain prior authorization does not add much time to the total time psychiatric patients spend” in emergency departments, the researchers wrote. If the process helps contain costs, “it does so largely through a deterrent effect – we call it ‘rationing by hassle factor’ – given that in all but one case physician requests for authorization were granted.”

The 1 million hours figure was reached by considering 1.6 million psychiatric admissions a year and the average 38 minutes of phone time for each.

“Society pays for inadequate psychiatric care,” said lead author Amy Funkenstein, a child psychiatry fellow at Brown University.

The authors said demand for psychiatric in-patient services is often higher than the supply, and patients end up staying in emergency departments longer than appropriate. Though the study sample was small, researchers said that with Massachusetts being a model for healthcare reform and the relative high number of psychiatric facilities in the Boston area, “the difficulty of accessing psychiatric services in most other parts of the U.S. is likely worse than what we found in our study.”

http://www.latimes.com/news/science/sciencenow/la-heb-insurance-psychiatric-patients-study-says-20130423,0,3243960.story

ERs Have Become De Facto Psych Wards

The Wall Street Journal, April 24, 2013

WASHINGTON, PRNewswire-USNewswire — Long waits for insurance authorization allowing psychiatric patients to be admitted to the hospital from the emergency department waste thousands of hours of physician time, given that most requests for authorization are ultimately granted. A letter to be published in the May issue of Annals of Emergency Medicine argues that pre-authorization process is akin to health care “rationing by hassle factor” (“Insurance Prior Authorization Approval Does Not Substantially Lengthen the Emergency Department Length of Stay for Patients with Psychiatric Conditions”).

“An emergency department is just about the worst place for a psychiatric patient to wait for an inpatient bed, and yet that is exactly what the pre-authorization process forces on millions of these vulnerable people, ” said senior author J. Wesley Boyd, MD, PhD of the Cambridge Health Alliance in Cambridge, Mass. “The thousands upon thousands of hours emergency physicians spend obtaining prior authorization for admission to the hospital are hours we are not spending on direct patient care. Only Medicare does not require prior authorization for us to admit psychiatric patients to the hospital; maybe they are onto something.”

Researchers recorded data on 53 patients, most of whom were in the emergency department because they were having suicidal thoughts. Half of the authorization requests took under 20 minutes to be approved, but 10 percent of the patients’ authorizations took an hour or more. Only one of the 53 patients’ insurance carriers denied pre-authorization. There are approximately 2.5 million psychiatric admissions to hospitals every year in the U.S.

“Psychiatric care is really the poor stepchild in the world of insurance coverage,” said lead author Amy Funkenstein, MD, of Brown University in Providence, R.I. “Insurance carriers reimburse poorly and as a consequence, hospitals often have inadequate resources for patients who urgently need this care. The situation is so dire that ERs are now being designed and configured to house psychiatric patients awaiting placement as inpatients. These patients deserve better.”

Annals of Emergency Medicine is the peer-reviewed scientific journal for the American College of Emergency Physicians, the national medical society representing emergency medicine. ACEP is committed to advancing emergency care through continuing education, research, and public education. Headquartered in Dallas, Texas, ACEP has 53 chapters representing each state, as well as Puerto Rico and the District of Columbia. A Government Services Chapter represents emergency physicians employed by military branches and other government agencies. For more information, visit www.acep.org.

www.annemergmed.com
twitter.com/emergencydocs
For more information, visit: http://newsroom.acep.org
SOURCE American College of Emergency Physicians (ACEP)
Web site: http://www.acep.org

http://online.wsj.com/article/PR-CO-20130424-910679.html?mod=googlenews_wsj

Is the slowdown in health care spending good news?

We still have a health-care spending problem

By Drew Altman and Larry Levitt
The Washington Post, April 21, 2013

For the past several months, analysts at the Kaiser Family Foundation and the Altarum Institute have been analyzing the recent slowdown in health spending. On average, health spending grew by 4.2 percent per year from 2008 to 2012, down from the recent peak of 8.8 percent from 2001 to 2003 and the lowest rate of growth in five decades. Our main conclusion is that most of this slowdown, 77 percent, has been due to years of a weak economy, which causes people to put off health services when they can and prompts employers and states to reduce health spending. The other 23 percent is explained by changes in the health system, including increased consumer cost-sharing, tighter managed care and modifications in payment and delivery (we can’t precisely pinpoint the separate effects of these three factors).

We need to be realistic about the fact that health spending will start going up more rapidly again as the economy improves. But how much costs escalate is at least in part within our control, and that matters a lot for federal and state budgets, employers and families. The place to start is by recognizing that the problem of health-care costs is far from solved.

Drew Altman is president and chief executive of the Kaiser Family Foundation, of which Larry Levitt is senior vice president.

http://www.washingtonpost.com/opinions/we-still-have-a-health-care-spending-problem/2013/04/21/2e105bbc-a854-11e2-8302-3c7e0ea97057_story.html

KFF Snapshot – Assessing the Effects of the Economy on the Recent Slowdown in Health Spending: http://www.kff.org/insurance/snapshot/chcm042213oth.cfm

Comment:

By Don McCanne, M.D.

We are now experiencing the slowest growth in health-care spending in the past half century. Though most agree that the weak economy slowed the rate of growth, many now claim that implementation of the Affordable Care Act is responsible for the protracted slowing while predicting that further implementation will finally bring excessive cost escalation under containment. What is really happening here?

Although the growth of spending – at 4.2 percent – is much lower than recent historical trends, it still represents excess growth since inflation has been flat and the growth of GDP has been very sluggish. Should we return to a more vibrant economy and more typical inflation rates, with no other changes, the rate of growth in health-care costs would be in the higher ranges that we no longer tolerate. So the good news in the slowing of health-care spending may not be such good news after all.

An important finding in this Kaiser Family Foundation report is that over three-fourths of the slowing has been due to the weak economy. We are not only facing a disappointing recovery, this factor in the slowing of health-care spending does not bode well for the future. If the economy recovers fully, high rates of spending increases will return. If, as some economists warn, we remain in a protracted stagnant economy with relatively high unemployment rates – a new “normal” for our economy – rates in the mid-single digits will still represent excess rates of increased health-care spending.

What about the other trends that have slowed spending? Of course, they are not as important as the vibrancy of the economy since they represent less than one-fourth of the slowing, but we can use any help. Or can we?

This study was not able to quantify the effect of the provisions of the Affordable Care Act in reducing spending. What is clear though is that much of the slowing not related to the economy has been due to the imposition of greater cost sharing, especially higher deductibles, and to the ratcheting up of managed care intrusions such as more restrictive provider lists and greater use of tiering of benefits. For containing costs, these are unwise policies because they create barriers that impair access to health-care services that patients should have. That is a terrible way to control spending.

So what hope is there? The policy community seems to be hanging its hat on accountable care organizations ACOs) and bundled payments. Think about what percentage of services delivered would be significantly altered by these tools. There should be very little change in the amount of appropriate care. Teasing out inappropriate care is difficult if for no other reason than there are few guidelines to determine what should be eliminated. Further, how much can you really pare off of the spending, when, even if bundled, most of the services would still have to be rendered? Are you really reducing spending, or just shifting the costs? Even if ACOs and bundled payments worked as intended, the amount of savings would be negligible when considering the magnitude of the problem.

Drew Altman and Larry Levitt write, “The place to start is by recognizing that the problem of health-care costs is far from solved.” If ever there was a time to pull out the drawer and look for proven policy solutions, that time is now. The single payer model is a proven model, and is just what we need. Without it, we can anticipate higher health-care spending and worse health-care access in an economy that is working well for the wealthy, but not very well for the rest of us.

Psychiatrists spend 1 million hours a year awaiting insurance approval, study says

By Amanda Woerner
Fox News, April 23, 2013

One million hours: That’s how long psychiatrists across the country spend each year, waiting to get approval from insurance companies before they’re able to hospitalize suicidal or mentally ill patients from the emergency room, according to estimates from a new study in the Annals of Emergency Medicine.

Unlike other doctors, psychiatrists are required to seek permission from a patient’s insurance company, before admitting anyone to the hospital from an emergency room.

“If we think logically about what it would be like if someone came into the ER with a life-threatening illness and they had to wait to get admitted – that would be ridiculous,” study author and child psychiatry fellow at Brown University, Dr. Amy Funkenstein told FoxNews.com. “Our patients have life-threatening illnesses too, and we need to not question whether they deserve the hospitalization.”

After determining a patient needs to be treated – often because he or she is suicidal, psychotic or even homicidal – psychiatrists must call the patients’ insurer and present their case as to why they believe hospitalization is necessary. They present initially to an administrator and then to a social worker. If the case is denied by the social worker, the psychiatrists must present their case to a doctor.

Approval is required for all insured patients – except those on Medicare.

Funkenstein became increasingly frustrated with the insurance approval process while completing her psychiatric residency, so she asked her colleagues to begin recording the amount of time they spent seeking insurance approval – as well as the total time their psychiatric patients spent waiting in the ER, over the course of three months.

The study, published April 23, showed the approval process takes on average, 38 minutes, and with approximately 1.6 million psychiatric admissions requiring approval every year, that translates into 1 million hours of a psychiatrist’s time, which Funkenstein described as “wasted.”

Funkenstein pointed out the process can often take much longer.

“I once had a child who boarded for three days in the ER because the social worker didn’t believe admission was appropriate, while I waited for a doctor from the insurance company to call me back,” Funkenstein said.

The study also revealed the median time psychiatric patients spent in the emergency room before being admitted was 8.5 hours.

Incidentally, Funkenstein noticed that despite all the time spent requesting authorization, only one in 53 cases were denied.

“You’re waiting for 40 minutes to present a five-minute case, and they always said, ‘OK.’ You’re wasting hours every night with no change in the (outcome),” Funkenstein said.

Funkenstein hopes her research will help grant psychiatrists the same freedom that other medical doctors have – to admit patients freely, based on their own clinical expertise.

“Ideally, we would have a similar system to what our medical colleagues have,” Funkenstein said. “We make a decision – (a patient) needs to be admitted, and we don’t have to call the insurance company.”

Funkenstein said she believes psychiatric disorders are often seen as less medically urgent because people don’t understand them. She also pointed out that people suffering from mental illness are often not able to demand better care.

“These are homeless individuals, veterans; this is this disenfranchised group,” Funkenstein said. “We’re stuck as a profession, and the only people to advocate for these patients are us.”

http://www.foxnews.com/health/2013/04/23/psychiatrists-spend-1-million-hours-year-awaiting-insurance-approval-study-says/

1 million hours may be spent annually for insurance approvals for inpatient psychiatric admissions

Psychiatrists spent on average 38 minutes on the telephone getting approval from insurance companies for psychiatric patients in need of inpatient care at the ED, according to a research letter published today in the Annals of Emergency Medicine

Psychiatric Annals, April 23, 2013

Approximately 1.6 million psychiatric patients with private insurance are admitted to the ED every year in the United States, which means that about 1 million hours are spent seeking authorization on their behalf.

During a 3-month period, Amy Funkenstein, MD, of Brown University, and colleagues collected data on 53 patients seeking inpatient psychiatric care at the Cambridge Health Alliance psychiatric ED in Cambridge, Mass. The researchers calculated how long the patients stayed in the ED before hospitalization and the length of time ED psychiatrists spent obtaining their insurance approvals. Patients’ diagnoses spanned the entire psychiatric spectrum, and the most common complaint was suicidal ideation.

In all but one case, authorization was granted to the patients. The average time between first contact with the insurance company until authorization for admission was granted or denied was 38 minutes. According to the researchers, half of the requests were resolved in less than 20 minutes, but for about 10% of patients, the approval process took 1 hour or more to complete. The longest wait for admission was 5 hours. The median time that patients spent in the ED was 8.5 hours; the shortest stay was 3 hours and the longest 20 hours.

According to study researcher J. Wesley Boyd, MD, PhD, of Harvard University, insurers use the authorization process as a deterrent to avoid paying for inpatient care.

“Insurers hope that clinicians will be so hassled by authorization procedures that they won’t seek admission for their patients, saving insurance companies money,” Boyd said in a press release. “Placing profits ahead of the health of patients when mental illness makes them vulnerable is immoral. A single-payer Medicare-for-all health care system would represent a great leap forward for patients and providers alike.”

The researchers noted that reimbursements for psychiatric care are lower compared with that of other health care services, and health care organizations frequently limit the number of psychiatric beds a hospital can have, which in turn increases the demand for mental health care.

“[T]he result is that our nation’s EDs are de facto psychiatric wards, with 79% of emergency physicians reporting that their hospitals board psychiatric patients for whom appropriate treatment resources could not be found, sometimes for days,” the researchers wrote. “The situation is so dire that EDs (are) now being designed and configured to house psychiatric patients awaiting placement.”

Disclosure:The researchers report no relevant financial disclosures.

Funkenstein A. Ann Emerg Med. 2013;doi: 10.1016/j.annemergmed.2012.10.033.

http://www.healio.com/psychiatry/practice-management/news/online/%7BBAEF6E1F-5DCB-4071-86AB-15A6ED917A09%7D/1-million-hours-may-be-spent-annually-for-insurance-approvals-for-inpatient-psychiatric-admissions

NHS: Section 75 of the health act is an engine for destruction

Section 75 of the health act is the mechanism that locks in privatisation of the health service: the Lords must amend it

By Kailash Chand 
The Guardian (U.K.), April 22, 2013

Andrew Lansley’s Health and Social Care Act, which came into effect on 1 April, had a troubled passage through parliament, including an unusual legislative “pause”. This was to allow the government time to “listen” to its many critics, including most healthcare professionals and a majority of the public, who believed the plans would create and lock in rights for private providers to make a profit from the NHS. Lansley gave assurances that these voices had been heard, and that clinical commissioning groups would be able to decide “when and how competition should be used”.

However, concerns about privatisation return to centre stage this week, when the regulations governing procurement and competition are debated in the Lords. As Lucy Reynolds, a research fellow at the London School of Hygiene and Tropical Medicine, puts it, if the act itself was the aircraft of privatisation, the structure that gave the idea the potential to fly, section 75 of the regulations is the engine that will allow take off.

The wording of section 75 requires commissioners to put out to tender everything that could be provided by an organisation other than the NHS. Private contractors are more likely to win these tenders than doctors, many of whom will never have even seen a tender notice. The regulations would create rights for commercial providers under rules originally devised by US corporations to promote their commercial interests. If implemented, they will drag the NHS into a competition law regime which creates obligations for governments to compensate private providers in the event of services being brought back into public provision.

The British Medical Association, along with many other health organisations including the Royal College of General Practitioners, are calling for the regulations to be withdrawn, as is the Labour party. The BMA says they must be replaced with new regulations that “unambiguously reflect previous government assurances that commissioners will not be forced to use competition when making their commissioning decisions”, and explicitly state this principle.

As contracts are lost by public sector bidders, the teams that would have delivered them will be made redundant because funds will not be available to pay them. Under the proposed regulations, the government is not permitted to rescue such a service unless all other competitors are equally subsidised, in the interests of non-discrimination.

The competitive tendering forced by the current draft of the regulations requires a large amount of administration, which will divert funds away from frontline care. Thanks to market-driven changes that have already taken place administrative costs have risen to at least 16%, in contrast to the pre-1980 figure of less than 5%.

These regulations will act as the motor of the NHS privatisation by giving companies a mechanism to force their way into NHS service provision for the patients, procedures and places wherever they see profits. The likes of Care UK or Virgin Care will try to cherry-pick easy and profitable services – diagnostics, routine elective surgery, and simple treatments, for example – leaving behind A&E, care of the elderly, mental health services and anything that is unpredictably expensive.

Seeking the withdrawal and replacement of these regulations is not scaremongering; there is plenty of evidence that market-driven health services lead to limited choice, escalating costs, and reduced quality. There is no evidence to support the idea that competition breeds excellence in healthcare. According to Robert Evans, professor of economics at the University of British Columbia, market innovations in the NHS over the last 40 years have led to greater inequity, increased inefficiency, cost inflation and higher levels of public dissatisfaction. It is time to reject the market ideology that has plagued the NHS for more than a quarter of a century, wasting billions of pounds in the process.

http://www.guardian.co.uk/commentisfree/2013/apr/22/section-75-health-act-destruction-engine

1 million hours of psychiatrist time wasted yearly on phone approvals for hospitalization

Harvard researchers find lengthy waits for severely ill psychiatric patients

FOR IMMEDIATE RELEASE
April 23, 2013

A study published today in Annals of Emergency Medicine reports lengthy waits for severely ill psychiatric patients in need of immediate hospitalization in the Boston area, due in part to time-consuming prior authorizations required by insurance companies.

Psychiatrists spent, on average, 38 minutes on the telephone getting authorization. In 10 percent of cases it took more than one hour to obtain insurance authorization; in one case authorization took five hours of psychiatrist time.

Mental health disorders are common, affecting nearly 1 in 4 adults annually, less than a third of whom receive psychiatric care. Better access to care might reduce the harms mental illness imposes on the mentally ill, their families and communities.

For the present study, over a three-month period, researchers tabulated how long psychiatric patients who were deemed in need of inpatient admission stayed in the emergency department (ED) prior to being hospitalized, and the amount of time that the ED psychiatrists spent obtaining authorization from the patient’s insurer. A group of 11 psychiatric residents at Cambridge Health Alliance (CHA) working in the psychiatric ED with acutely ill psychiatric patients collected the data.

Most patients required hospitalization because they were suicidal or, in a few cases, homicidal.

Although obtaining insurance authorization delayed care and took clinicians away from other duties, only 1 of the 53 requests for authorization was denied. Median total time in the ED was 8.5 hours, with the shortest stay lasting 3 hours and the longest recorded stay lasting 20 hours.

These numbers don’t include a handful of patients who boarded in the ED over the weekend while waiting for an inpatient bed to become available for them. They exclude uninsured patients and those with Medicare, which doesn’t require prior authorization.

With approximately 1.6 million psychiatric admissions among people with private insurance nationwide each year, 38 minutes of phone time to obtain authorization translates into about 1 million hours of wasted psychiatrist time.

Lead author Dr. Amy Funkenstein, a child psychiatry fellow at Brown University, led the study while she was a psychiatric resident at CHA and Harvard Medical School. She said: “Society pays for inadequate psychiatric care; more than half of all prison inmates and a third of all homeless people are mentally ill. Massachusetts is considered a model for health reform, yet we found that seriously ill patients routinely spent hours stranded in the ED due to insurance bureaucracy. The hours psychiatrists spend obtaining those authorizations could be far better spent treating our patients.”

Senior author Dr. J. Wesley Boyd, attending psychiatrist at CHA and assistant clinical professor of psychiatry at Harvard Medical School, commented: “Private insurers are obstructing care by requiring authorizations before a qualified psychiatrist can hospitalize a dangerously ill patient. With doctors, nurses and emergency departments already overburdened, adding a time consuming bureaucratic task that doesn’t help patients is unconscionable.

“Insurers hope that clinicians will be so hassled by authorization procedures that they won’t seek admission for their patients, saving insurance companies money,” he said. “Placing profits ahead of the health of patients when mental illness makes them vulnerable is immoral. A single-payer Medicare-for-all health care system would represent a great leap forward for patients and providers alike.”

*****

“Insurance Prior Authorization Approval Does Not Substantially Lengthen the Emergency Department Length of Stay for Patients with Psychiatric Conditions,” Amy Funkenstein, M.D., Monica Malowney, B.A., and J. Wesley Boyd, M.D., Ph.D. Annals of Emergency Medicine, April 23, 2013.

The doi for this article is 10.1016/j.annemergmed.2012.10.033.

A copy of the manuscript of the study, which takes the form of a clinical observations research letter, is available here.

*****

Physicians for a National Health Program (www.pnhp.org) is a nonprofit research and education organization of more than 18,000 doctors who advocate for single-payer national health insurance, an improved Medicare for all. PNHP had no role in funding or otherwise supporting the study described above. To speak with a physician/spokesperson in your area, visit www.pnhp.org/stateactions or call (312) 782-6006.

Businessman Allan Tweddle responds to Uwe Reinhardt on "one size fits all"

Allan Tweddle responds to Uwe Reinhardt on "one size fits all"

(Quote of the Day for April 16, 2013 https://pnhp.org/news/2013/april/uwe-reinhardt-on-one-size-fits-all):

I am no expert, just a Canadian born US Citizen with family still north of the border.  I have seen the personal value of their system many, many times.  From horrific cancer in children, to heart and cancer in elderly, to total hip replacements, all covered at zero expense to the citizen patient.
 
And even that needs clarification.  In the Canadian Immigration web page, once a person is accepted by their immigration department, a new arrival into Canada will get full coverage within 3 months after arrival.  That is remarkable, considering that that person has not yet contributed one dime to the system.
 
Their system, like in Britain, provides basic health care for all and lets the private insurers pick up the tab for luxury items like fancy hospital suites, Viagra, etc.
 
The Canadian system is controlled, designed and managed by each province.  It has Federal dollars in each plan, so while their experience is NOT “One size fits all”, they have made it work for 30 years or more.  Did we make any attempt to study their success and learn from their mistakes?  I doubt it.
 
However, there are only 10 provinces.
 
Our ACA plan that tries to take into consideration 50 States does look far too complicated. I’ve been in briefings for the West Virginia plan alone, and it’s too complicated.  We need to just lower the eligibility age of Medicare to age zero less 9 months!
 
We need a single payer for the basics so we eliminate bankruptcy due to unexpected and financially catastrophic health care costs to individuals.  It is my understanding that in the U.S., medical debt contributes to 62% of all bankruptcies. In Canada that number is ZERO!
 
Shouldn’t we be protecting the citizens and not the greed-driven insurance industry?

****

Our emerging manufacturing company has been considering a location for our production operations.  We have concluded, like so many automobile companies* have, that Southern Ontario would be financially attractive due, among other reasons, to the differential in payroll burden.  Aerospace payroll burden here is about 36%, whereas it is 15 to 18% in Ontario.  That’s a significant differential…20%!  And from everything we have been able to determine, the difference is health care expense. (*Did you know that the expense of health care is almost always cited as a primary reason for the announcement of new plants in Ontario, so that now more cars are made and assembled in Ontario than Michigan?)
 
The financial/economic value of a universal single payer system is obvious to us.  And when you learn that the system they have there has better health results, then the choice becomes clear.  And if any right-wing free enterprise enthusiast who has an open mind would pay attention to the sheer economic advantages, they would join us on a bandwagon to get it here.
 
But we cannot wait for that to happen, so we will in all probability be locating there.

Allan Tweddle, of Charleston, West Virginia, is Chairman and CEO of an aerospace manufacturing firm. His email address: allantweddle@msn.com

Comment:

By Don McCanne, M.D.

We should listen to this Canadian-born, U.S. businessman who is very familiar with the health-care systems and the business climates in both the United States and Canada. The lure of Canada’s health-care system may be too great for his company to establish production operations here in the United States. That should awaken us all, especially the business community.

Much less important, a comment on “one size fits all” is warranted. That phrase has been used endless times to dismiss single payer reform. Used this way, it implies that there are many “sizes” in health care. In reality, when you need health care, you aren’t checking out “sizes.” You merely want unrestricted access to the health care delivery system that we have.

The “sizes” they speak of usually refer to different insurance products, ranging from almost worthless mini-med plans to comprehensive, integrated HMOs. (For purposes this discussion, integrated health care delivery systems such as Kaiser and Group Health are considered components of our health care delivery system rather than as intermediary insurers.)

When individuals select their own insurance plans, which do they choose most often? They select high-deductible, preferred provider organizations. That is, they select a “size” that works if they stay healthy. Should they develop significant health problems, that particular “size” will prevent them from being able to have free choice of their health care professionals and institutions, and it will leave them with out-of-pocket financial burdens – neither of which is the “size” that they really wanted, especially when they find out too late that it didn’t fit.

Mr. Tweddle points out that Canada’s single payer system is not “one size fits all” since it is separately administered in each of their ten provinces. But, refocusing, the Canada Health Act does pull all of the provinces together into one “size” that is universal, comprehensive, accessible, portable, and publicly administered. Quite clearly, this is not a “size” that is inflexible to varying needs, but rather it is a comprehensive program that fits all.

When you shop for health insurance, it is important to keep in mind that all of the private insurance choices are the wrong size, to varying degrees. The only right size out there is the health care delivery system which can be readily accessed by getting all of the wrong-sized insurers out of the way, except for the one right-sized program that really does fit everyone – a single payer national health program, or improved Medicare for all.

Single-payer plan is best health care solution

By Thomas P. Clairmont, M.D.
Portsmouth (N.H.) Herald, Letters, April 20, 2013

The Chidester (op-ed) correctly identifies the problems in health care today: uncontrolled costs and the rising number of uninsured.

He advocates for a simple solution, but fails to deliver one.

His numbers are absolutely wrong. A review of the Census Bureau Web site clearly states that the uninsured number for 2010 was 49,904,000. His number is one-sixth of that. However, it doesn’t really matter. At Physicians for a National Health Program, we feel that one uninsured person is too many. This is reflected in our motto: Everybody In, Nobody Out.

He then advocates for free markets as the solution, comparing buying health insurance to purchasing cell phones and computers. Free markets have been around for a long time, giving us premium increases multiple times inflation for the past decade. Just this week, the Herald reported the York School Department is facing a 13 percent increase in health care premiums. Health care inflation for 2012 was only 3.7 percent.

Free markets don’t work in health care. Every business wants more customers. In health insurance, however, that isn’t true. They only want the healthy, who won’t hurt their bottom line of excessive profits, inordinate executive compensation and returns to stockholders.

Chidester then says he wants a simple solution. OK, so does everyone else. Let’s look at the Vermont Plan, authored by Harvard economics Professor William Hsiao. He outlined four goals:

(1) Universal health insurance coverage; (2) provision to every Vermont resident of an adequate standard benefits package and equal access to health care; (3) control of the rapidly escalating costs of health care in Vermont; and (4) establishment of a system that prioritizes community-based preventive and primary care, as well as integrated health care delivery.

He accomplishes this with a single-payer plan that dramatically reduces administrative expenses. In fact, his plan will immediately reduce health care costs in Vermont by 8-12 percent and reduce health care costs by an additional 12-14 percent over time. Keep in mind that every resident is covered and they won’t have to decide which policy they want, with what combination of co-payments, deductibles and other out-of-pocket costs that are a deterrent to good health. Now that is a simple plan. Do you want the Chidester plan or complete health care security for you and your family?

Dr. Thomas P. Clairmont resides in Portsmouth, N.H.

http://www.seacoastonline.com/articles/20130420-OPINION-304200304