Archive for the ‘Health Care Reform’ Category

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The Amazing Maze of US Health Care » Barack Obama – Can we re-imagine health insurance?

Published on January 24, 2009 in Health Care Reform.

Amazing seems a most appropriate word to describe the financing and delivery of health care services in the United States of America.

James L. McGee, CEBS--On Health Care Reform


Barack Obama – Can we re-imagine health insurance?

With the election of Barack Obama, there is a lot of hope and optimism about the potential for health care reform.

There is also some nervousness.

The nervousness originates from those who think that the current economic crises will inhibit reform efforts.  That somehow the price tag of reform will scare people away from health care reform.  I am encouraged by an insightful article by Ezra Klein on Obama’s choice of Director of the Office of Management and Budget.

According to Klein, Peter Orszag believes that health care reform is the key to the fiscal future.  Since it his office that will pin the price tag on any health care proposal, his biases matter.

Others are worried that Obama might be soft on insurance companies.

I am not a great friend of the insurance companies.  I deal with them every day.  But neither am I a knee-jerk opponent of insurance companies.

Insurance companies reflect the markets they operate in.  And health insurance companies function in a market that brings out their worst qualites.

Unlike home insurance, or auto insurance, there is no legal or market mandate to have health insurance.  This allows health insurance companies to avoid insuring the very people that need it the most – high risk (read sick) individuals.

Outside of the Medicare supplemental insurance market, there are very few limitations on what should be covered or not covered in a health insurance plan.  This gives insurance companies the license to put restrictions and exclusions in their policies as they, or their customers, see fit.

Please Click Here to Read the Complete Article by Jim McGee » The Amazing Maze of US Health Care » Barack Obama – Can we re-imagine health insurance?

The Amazing Maze of US Health Care » Health Care Reform – Three different themes

Published on January 17, 2009 in Health Care Reform.

Amazing seems a most appropriate word to describe the financing and delivery of health care services in the United States of America.

James L. McGee, CEBS--On Health Care Reform


Health Care Reform – Three different themes

Three reports this week about the costs of health care and health care reform caught my attention.  One said that health care reform will be a sure fire economic stimulus because it will replace jobs lost from the current recession.   Another suggests that a modest upfront investment will produce $530 billion in savings.  The third moans that without a commitment to hard choices, we are doomed to health care spending profligacy.

John Nichols in The Nation describes a report and follow-on campaign by the National Nurses Organizing Committee/California Nurses Association (NNOC/CAN) that attempts to bolster the argument for a Single Payer health care system by describing its impact on jobs and the economy.

A report in Reuters describes a report by DeLoitte that argues that a $220 billion investment in e-prescribing and electronic medical records will produce $530 billion over ten years.

Lastly, Robert Samuelson in the Washington Post reports on findings of a report by the McKinsey Global Institute that provides valuable insights into why US health care costs so much more than it does elsewhere in the world.  Unfortunately,  it was short on constructive “shovel ready” policies.

So how does one react to such disparate perspectives.  Clearly, each study  support a specific ideological slant and approach to fixing our admittedly broken system.

Please Click Here to Read the Complete Article by Jim McGee » The Amazing Maze of US Health Care » Health Care Reform – Three different themes

The Amazing Maze of US Health Care » Payment Reform – don’t put me in the middle

Published on January 10, 2009 in Health Care Reform.

Amazing seems a most appropriate word to describe the financing and delivery of health care services in the United States of America.

James L. McGee, CEBS--On Health Care Reform


Payment Reform – don’t put me in the middle

Just about every health care reform proposal includes payment reform as an important part of its platform.    Most of the proposals come from organizations representing providers.  Not much is heard form the other side of the exchange.

Two stories recently highlight the need for payment reform from the consumer point of view.

Number one.            My son recently visited friends in New York City.  An unfortunate accident landed him in the New York University hospital for two days.  He is 23 years old and has his own very good insurance.

Several weeks after he returned home, he received a bill from one of the doctors that treated him in the hospital.  Apparently the insurance only paid him a bit more than $200 of the $800 bill.  Because he was an out of network doctor, he could and did bill for the balance.

Number two.            A Participant called our plan recently.  His daughter was travelling with her mother to visit  her grandmother in a southern state.  She too wound up in the hospital.  The family belongs to an HMO and so the HMO paid the Emergency Room bills and the follow on hospital stay.  But they are having difficulty with the follow up care.  HMOs routinely do not pay for services provided by out of network providers.

These examples represent the most frequent type of complaints that we hear from members and why payment reform should matter to consumers.

Before I explore these two stories more detail, I wanted to outline why providers, academics and some large purchasers are advocating for payment reform.

Please Click Here to Read the Complete Article by Jim McGee » The Amazing Maze of US Health Care » Payment Reform – don’t put me in the middle

The Amazing Maze of US Health Care » 10 Health Care Reform Principles for 09

Published on December 27, 2008 in Health Care Reform.

Amazing seems a most appropriate word to describe the financing and delivery of health care services in the United States of America.

James L. McGee, CEBS--On Health Care Reform


10 Health Care Reform Principles for 09

The blogosphere is buzzing with discussions about the promise of health care reform.  For a weekly poster like me, it is impossible to keep up.  As 2009 approaches, and more importantly, as 1.20.09 approaches, I thought I would offer my insights into the topic from the perspective of the administrator of an employer and union sponsored health benefit plan

If there is one thing that unites the comments it is their oppositional posture.  Insurance companies are the most common enemy, but hardly anyone escapes.

So I would like to go on the offensive and tick off a few positives that I would like to see in health care reform.  Please indulge my autocratic use of the term “will”. 

1. Every individual will be required to have health insurance.

2.There will be a defined set of benefit plans.

3. There  will be a uniform drug formulary. 

4. There will be payment reform.

5. Medical education reform will include major financial support by the federal government. 6. There will be a system for a fair redress of medical errors.

7. Cost to the individual will be based on ability to pay.8. There will be delivery system reform

9. There will be room for experimentation.

10. Above all, there will be recognition that the health of the nation is not dependent solely on its health care system.  It depends on good nutrition, opportunities for exercise and outdoor recreation, on the education of its citizenry, on safe working environments, on safe drinking water and sanitation systems, and on clean air.

Over time I will take the opportunity to expand on these topics.  Some may notice that I offer no silver bullets: fix this one thing and all will be right.  It took this country a long time to get into  this mess.  Fixing it will take time, leadership, and concerted effort.

Please Click Here to Read the Complete Article by Jim McGee » The Amazing Maze of US Health Care » 10 Health Care Reform Principles for 09

The Amazing Maze of US Health Care » Health Care Reform in Germany

Published on December 20, 2008 in Health Care Reform.

Amazing seems a most appropriate word to describe the financing and delivery of health care services in the United States of America.

James L. McGee, CEBS--On Health Care Reform


Health Care Reform in Germany

This past spring, Health Affairs, the premier health policy journal, had an interview with the German Minister of Health, Ulla Schmidt.  The interview focused on reforms to Germany’s health system instituted principally in 2007.  Minister Schmitt was asked what were the goals of the reforms. Her answer – she wanted to preserve the principles of social solidarity and affordability that had always been a part the German health system.

In comparison to health care in the United States, the Germans system could hardly be called a system in crises.  The per capita costs were about half of  what they were in this country $3,200 per person in Germany compared to $6,400 here.  But they did have too many uninsured – about 0.2% of the population.  The United States, by comparison has 15% uninsured.

So the question is, What do Germans understand by social solidarity?  Minister Schmitt explained that everyone in Germany has guaranteed access to health care and everyone contributes to the financing based on their ability to pay.  Well, if that is social solidarity, where does affordability fit in?  For Minister Schmitt, if the entire system is not affordable, the social solidarity begins to break down. 

Too much of the health care debate in this country is muddled by ideology on both sides.  For many in this country, European health care sytems smack of “socialism.”  Yet, two of the defining characteristics of the German system are not real popular among progressives in this country.  The Germans have an individual mandate and they rely on insurance companies, although in Germany they give them a more accurate name, Krankenkassen, or Sickness Funds.

Please Click Here to Read the Complete Article by Jim McGee » The Amazing Maze of US Health Care » Health Care Reform in Germany

The Amazing Maze of US Health Care » QMCSO – Say what?

Published on December 6, 2008 in Health Care Reform.

Amazing seems a most appropriate word to describe the financing and delivery of health care services in the United States of America.

James L. McGee, CEBS--On Health Care Reform


QMCSO – Say what?

In my last post, I wrote that health care reform proposals need to focus on the patient side of the health care delivery system by designing systems that eliminate the cumbersome, even tortuous routes that patients must travel to enter that increasingly privileged space – a person with health insurance.

An illustrative example is the Qualified Medical Child Support Order (QMCSO).  QMCSOs apply to those children who live with one parent but the court orders the other parent to provide the health insurance.  The parent who has custody of the child is called, logically, the custodial parent.  The other parent is called, can you guess, the non-custodial parent.

Every child support agency in every county and state in the country has a bureaucracy for the purpose of enforcing and administering QMCSOs.  It does not matter why the parents are not together.  Some are divorces, but some were never married.  For a group of 25,000 Participants, my staff probably spends one to three days per month on issues related to QMCSOs.

Very little of that time is spent processing the paperwork.  Most of it is dealing with custodial parents, non-custodial parents, child support agencies (issuing agencies in bureaucratese), carriers, attorneys and other stakeholders.  In other words, our staff’s time is matched by someone else’s staff time.  I did an extrapolation to the US population.   It assumes our population is a representative sample of the general population.  By my estimate, it is costing the United States economy $100,000,000.

Please Click Here to Read the Complete Article by Jim McGee » The Amazing Maze of US Health Care » Blog Archive » QMCSO – Say what?

The Amazing Maze of US Health Care » Administrative Cost Savings Is No Myth

Published on December 3, 2008 in Health Care Reform.
Amazing seems a most appropriate word to describe the financing and delivery of health care services in the United States of America.

James L. McGee, CEBS--On Health Care Reform

Since November 4th, interest in health reform proposals has understandably intensified.  I like to flatter myself that this blog might make a small contribution.  But I do have a day job and so the horn I blow here only has one note; if we simplify the system we can find the money we need to cover the people without health insurance and increase product satisfaction among all stakeholders. 

I am not a policy wonk who views the health care system wonderfully distilled through the glorious abstraction of statistics; nor am I encumbered by practical politics.   I view the system from the bottom looking up.  I have a stake in the present system, but that stake is poorly represented in these musings.  I am a gatekeeper to the health care maze.  In my ideal world there would be far less need for the work I am doing.

I know from daily encounters just how daunting that maze is for people needing care.  I tend to demonize piece rate physicians who are too quick to deny care rather than trust the maze.

So when I read others who write about health care reform I look for my theme.  On Sunday, November 23, 2008, the Washington Post published an opinion piece by Shannon Brownlee and Ezekiel Emanuel, 5 Myths About Our Ailing Health-Care System. The authors are right on target with four of the five myths that they debunk.  They drive home the point that we are paying a lot of money for our health care, that we are paying a lot of money for not particularly good health care, that we really are paying the price through premiums, taxes, and lost wages, and that Americans are ready for a change.

Please Click Here to Read the Complete Article by Jim McGee » The Amazing Maze of US Health Care » Administrative Cost Savings Is No Myth

The Amazing Maze of US Health Care » Tale of Two Blunders

Published on November 29, 2008 in Health Care Reform.

Amazing seems a most appropriate word to describe the financing and delivery of health care services in the United States of America.

James L. McGee, CEBS--On Health Care Reform


Tale of Two Blunders

Patients, administrators, and family members of victims aired their reflections about medical errors in a video on the on-line New York Times this week (November 25, 2008).  They all lamented that if only doctors and hospitals could own up to their mistakes, there just may be fewer lawsuits.

Two stories I listened to more than ten years ago underline that theme.  A friend, a lawyer representing a medical provider, shared with me his concern about his client that he would be defending at trial that week.  He had advised his client to settle because the evidence against his client was strong and he was not optimistic.

The patient had acquired an infection while in the hospital.  The evidence was incontrovertible and the patient had died.  But the patient was old and infirm and had little time left and even less quality time.  The infection may have hastened the inevitable but it also made the end needlessly painful for both the patient and the patient’s family.

The family asked only that the hospital not bill them for the extended six month hospital stay caused by the infection.  If the hospital agreed they would not sue. The hospital could not admit to a mistake and, as a result, appeared headed for a judgment that would cost the hospital several times the hospital stay.

The second story was from woman I met while waiting for jury duty.  It seems that during stomach surgery her doctor had perforated her stomach and he did not discover it before she was stitched back up.  The stomach acids caused havoc on her intestines.  I asked her if she had sued her doctor.  Oh no, she was quick to reply.  The doctor was so distraught about the mistake.  She could not do that to him.  He had paid for all her medical expenses since the incident several years earlier.  In addition, he only operated on one patient after that accident, resigning from his surgical practice, but not from his medical practice.

Please Click Here to Read the Complete Article by Jim McGee » The Amazing Maze of US Health Care » Tale of Two Blunders

The Amazing Maze of US Health Care » Health Insurance for Small Business

Published on November 22, 2008 in Health Care Reform.

Amazing seems a most appropriate word to describe the financing and delivery of health care services in the United States of America.

James L. McGee, CEBS--On Health Care Reform


Health Insurance for Small Business

Every health care reform proposal attempts to offer some relief for small businesses.  According to the National Federation of Independent Businesses (NFIB), small businesses create 2/3 of American jobs, yet half of the uninsured are in small businesses.

Look at President-elect Obama’s health care proposal on his campaign’s web site.  The first two items: 

  • Require health insurance companies to cover pre-existing conditions so all Americans regardless of the health status or history can get comprehensive benefits at fair and stable premiums.
  • Create a new Small Business Health Tax Credit to help small businesses provide affordable health insurance to their employees.

What’s remarkable about these proposals is that we are still discussing them.

Let’s look at the second item – a tax credit for small businesses.  In my opinion, it is a mistake to separate the small business market from the individual market.  Almost every small business starts out as a solo enterprise.  How many creative ideas never come to market because the would be entrepreneur is afraid to go without health insurance?

Yet we don’t make it easy.  Anyone who has ever itemized deductions has experienced the limits on the deductibility of health insurance costs.  There is also something called a section 105 deduction that you can learn about elsewhere.  Yet business owners can deduct the full cost of their medical insurance.  I would welcome an explanation that justifies this disparity, or at least explains the politics to me.

The real nut is the first item.  That we allow insurance companies to only insure healthy people is the greatest tragedy of American health care.  This is called medical underwriting.   Jonathan Cohn in his book, Sick, has a wonderful chapter on this stain on American health care. 

Please Click Here to Read the Complete Article by Jim McGee » The Amazing Maze of US Health Care » Health Insurance for Small Business

The Amazing Maze of US Health Care » For College Students – It’s not simple

Published on November 15, 2008 in Health Care Reform.

Amazing seems a most appropriate word to describe the financing and delivery of health care services in the United States of America.

James L. McGee, CEBS--On Health Care Reform


For College Students – It’s not simple

I support a simpler health care system.  That is my number one priority.   Thus I am unimpressed with the health care reform platform of our newly elected president.  I do share the hope and optimism of many that meaningful change can and will happen.

But getting a simpler health care system means that some of the stakeholders need to be cut lose from the system.  That is a politically daunting task. It is why most health care reform proposals try to add more patches to what is already a shabby patchwork quilt of private and public programs.

One effort does try to simplify a small part of our current system.  At least 30 states have mandated that insured health care plans cover all children until they reach a certain age.  Yet as simple as this concept is, it comes with more variations than states that have adopted it.

What are we trying to simplify?

Most health plans offer parents with dependent children in college the opportunity to continue coverage for their child if they provide evidence that the child is enrolled in a qualified post secondary education program.

This is a holdover from the days when children entered the job market after high school and those jobs provided health insurance.  Today, it is more likely that neither half of that statement is true. It is an obvious adaption to changing times.  It is a relatively easy way to expand coverage to a vulnerable population.  Young adults are healthier than the general population and therefore not an expensive expansion.  Of course, that doesn’t prevent this trend’s detractors from referring to it as the “slacker mandate”.

Please Click Here to Read the Complete Article by Jim McGee » The Amazing Maze of US Health Care » For College Students – It’s not simple

The Amazing Maze of US Health Care » Administrative Simplification

Published on November 8, 2008 in Health Care Reform.

Amazing seems a most appropriate word to describe the financing and delivery of health care services in the United States of America.

James L. McGee, CEBS--On Health Care Reform


Administrative Simplification

Sometimes people are magically teleported outside of their health care silo.

This happened to a group of our participants every month for several consecutive months.

At the beginning of each month one of the members of this group would call our office – “The doctor won’t treat me because he/she was told I have no health insurance.”

Our Plan had recently approved coverage for domestic partners.    Somehow, the computer system of one of our carriers could not properly interpret the code for a domestic partner.    The computer saw this adult as a child.   Sound like Alice in Wonderland?  One computer makes you larger and one computer makes you small.

The carrier told the doctor’s office that this member had no other adults on their plan, only a dependent child or dependent children.    In at least one case, the domestic partner was 52 years old and the couple had no dependent children.

Now this should not present an insurmountable challenge.  The Health Insurance Portability and Accountability Act (HIPAA), Public Law 104-191, includes provisions for what is referred to as Administrative Simplification.   This rabbit hole of  regulations details in excruciating detail the requirements for transmitting electronic files (Electronic Data Interchange or EDI), including enrollment files, first appeared in 2000.

The implementation guide for the enrollment file, ANSI ASC X12N 834, lists the acceptable individual relationship codes.    They appear in the INS02 Segment in the 2000 Loop.  The primary card holder is represented by the number 18, a dependent child is a 19, a spouse is a 2.    You may argue that the codes don’t make sense.    But they don’t need to.    After all, they are being read by a computer.    The code for a domestic partner is 53.

Notice that it does not include any of the digits used in any of the other codes.    So how does a 53 get confused with a 19?   Is our group the first to cover domestic partners?   How is a fifty two year old interpreted as a dependent child?

But as confounding as computer systems may be, they are at least constrained by laws of logic, laws that most of us find baffling, but laws nevertheless. How logical is it that every month, in some cases, every week or day, countless thousands of group health plans must send their updated enrollment and eligibility information to their respective health insurance carriers -  m ost of the time electronically, but far too often, on paper.

Please Click Here to Read the Complete Article by Jim McGee » The Amazing Maze of US Health Care » Administrative Simplification

The Amazing Maze of US Health Care » Seven dollars and forty cents – no sense

Published on November 1, 2008 in Health Care Reform.

Amazing seems a most appropriate word to describe the financing and delivery of health care services in the United States of America.

James L. McGee, CEBS--On Health Care Reform


Seven dollars and forty cents – no sense

Seven dollars and forty cents hardly seems like an amount that should erect a barrier to health care.

In fact, when Mr. Koch (all names are fictitious) called to complain about this bill for seven dollars and forty cents, my first reaction was, “You should appreciate how lucky you are that you have a health care plan that pays most of your bills. Why are you quibbling over $7.40?”
Of course, that is not an appropriate customer service response.

But listen to Mr. Koch. “This bill is for two pain pills that were given to me when I was admitted to the hospital for an emergency surgery.   Medicare won’t pay for the pills because they were “self-administered.”

Our insurance plan won’t pay, because Medicare won’t allow payment. (a common Medicare complementary policy). The hospital wants its $7.40. I must have been semi conscious when they gave me the pills, because I do not remember it at all.  Why should I pay for pills that some nurse made me swallow when I was semi-conscious?”
Mr. Koch’s total pharmacy bill for this hospital stay was over $8,000  Who is the one who is quibbling over $7.40?  And the issue has little to do with whether the two pills cost $7.40.
In fact, it is more likely that the hospital knows full well that the two pills only cost $0.20  But they calculate that it will take at least an additional $7.20 of bureaucratic labor to collect that $0.20.  The bureaucracy needs to be fed.
Think about the effort to maintain these bureaucracies.   Somewhere in the bowels of the CMS (Center for Medicare and Medicaid Services) someone has crafted regulations that stipulate that Medicare will not pay for certain medications that are self administered.
The logic is apparent  Before Medicare Part D, CMS did not pay for prescriptions outside the hospital or physician office. “Self administered” appears to fairly delineate the boundary between those drugs that can only be administered in a hospital or physician office setting, from those dispensed by a pharmacist.

Please Click Here to Read the Complete Article by Jim McGee » The Amazing Maze of US Health Care » Seven dollars and forty cents – no sense

The Amazing Maze of US Health Care » Ask Jesse the Artist

Published on October 25, 2008 in Health Care Reform.

Amazing seems a most appropriate word to describe the financing and delivery of health care services in the United States of America.

James L. McGee, CEBS--On Health Care Reform


Ask Jesse the Artist

Instead of focusing on Joe the Plumber and his tax phobia’s, perhaps the presidential candidates should talk to Jesse the Artist and ask him or her about health insurance.  On Sunday, October 19th, I visited the Bethesda Row Arts Festival in Bethesda, Maryland.  I did just that.  In a very unscientific survey, I talked to a number of the artists about their health insurance. 

Why should anyone else be interested in artists?  Because they are small business people.  They are also very creative.  It is this creative entrepreneurship of small businesses that candidates like to support because it is the economic engine  that drives the American economy.

Artists as Small Businesses

I was curious whether health insurance was a barrier to entry for these artists.  Two of the artist referred to a study (but could not name the source) that 83% of artists had health insurance.  That was consistent with my own unscientific study. I talked to close to 20 people.  Only three had no health insurance.  But, on the other hand, only three paid for their own health insurance.

Perhaps they asked the wrong question.

Please Click Here to Read the Complete Article by Jim McGee » The Amazing Maze of US Health Care » Ask Jesse the Artist

The Amazing Maze of US Health Care » A game of Old Maids

Published on October 18, 2008 in Health Care Reform.

Amazing seems a most appropriate word to describe the financing and delivery of health care services in the United States of America.

James L. McGee, CEBS--On Health Care Reform


A game of Old Maids

Approximately six months ago our office began receiving stacks of paper claims for prescription drugs. The drugs originated in various Veterans’ Administration medical centers around the country. They were for drugs that members in our Plan had received at VA medical centers.

It was obvious that there had been some sort of new policy at the VA that required the VA to obtain payment from other payers when veterans had other coverage. The problem in this case is that our Plan had just changed pharmacy benefit managers effective January 1, 2008.

So think about this. Until recently, a veteran who also happened to have other coverage went to a VA medical center and received care. The VA paid for the service and somebody figured out how much it added to national health expenditures. Our health plan did not pay for the services and therefore nothing was added to national health expenditures, other than the cost of keeping that Participant enrolled in our Plans.

Then someone in Congress got the idea that the VA could save money by finding someone else to pay for services. Ignore the macro perspective that it increases the total cost to the system. Now a layer of bureaucracy is added to find who is liable for payment and send the bill to that payer. Remember the card game Old Maid? Who is going to be left holding the poison card? That’s what our health care financing system has come down to.

Please Click Here to Read the Complete Article by Jim McGee » The Amazing Maze of US Health Care » A game of Old Maids

The Amazing US Health Care System

Published on October 14, 2008 in Health Care Reform.

Amazing seems a most appropriate word to describe the financing and delivery of health care services in the United States of America.

James L. McGee, CEBS--On Health Care Reform


The Amazing US Health Care System

Amazing seems a most appropriate word to describe the financing and delivery of health care services in the United States of America.

According to Merriam-Webster’s Collegiate Dictionary, 9th Edition (OK, I have an old dictionary) amazing is derived from a French word meaning “to confuse”.  Obsolete meanings include consternation, bewilderment and perplexing.

Yes, health care in the US is truly amazing.  Rube Goldberg could not have invented a more illogical maze of non-systems.  Lewis Carroll’s might have added an additional chapter on Alice’s efforts to get those pills that made her big and small.  Kafka might imagine a special Penal Colony for those responsible for this maze.

I should be careful on this last point, since I am part of that system.  I administer the benefit plan for approximately 25,000 participants.  I like to think that we do our best to help our members navigate what is all to often a daunting and perplexing maze.

Please Click Here to Read the Complete Article by Jim McGee » The Amazing Maze of US Health Care » The Amazing US Health Care System

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