Payers & Providers Midwest Edition – Issue of August 16, 2011

8/6/2019 Payers & Providers Midwest Edition Issue of August 16, 2011

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As various pieces of the gargantuan healthreform law are digested by the healthcarebody politic, the spotlight seems to shift fromone controversial aspect to another.

A few months ago the constitutionality wasin focus; then in June the shape of accountable care organizations came intoview. Last week health insurance exchangestook center stage.

On Aug. 9 Gov. Sam Brownback of Kansas,a conservative Republican, announced that hewas returning the $31.5 million earlyinnovation grant that his state insurancedepartment had won to develop an insuranceexchange. The Department of Health andHuman Services gave out the competitivegrants earlier this year to seven states that hadinteresting ideas on how the onlinemarketplaces might be set up.

Brownbacks move occurred over theobjections of the state insurancecommissioner, Sandy Praeger , who hadargued that Kansas should have its ownexchange regardless how people felt about theparticulars of the Affordable Care Act.

On Aug 12, meanwhile, HHS and theTreasury Department issued some preliminaryregulations governing establishment of theexchanges, including how to implement thepremium tax credit that is supposed to make itmore affordable for middle-class Americans topurchase a health insurance policy. HHSawarded $185 million to 13 states to helpthem develop their exchanges.

And a CNN report said that Walgreens intends to start selling health insurancethrough its own private exchange in the fall.The drugstore chain didnt con rm any suchplans but said it was looking at many options.

The health reform law requires most peopleto have health insurance by 2014. Itencourages states to set up insuranceexchanges on the internet where individuals,employers, and employees can buy policiesfrom participating companies and enroll inMedicaid. The idea is to introduce comparisonshopping to health insurance, much likebuying an airline ticket online. The exchangeswill calculate the subsidies that people qualifyfor, based on their incomes.

Residents in those states that decline to setup their own exchanges will be provided anexchange by the federal government.Private internet health exchanges already exist,such as eHealthInsurance.com, which offers avariety of insurance products by state. Andstate exchanges have been set up by Utah andMassachusetts.

The state exchanges have been embracedby some governors but condemned by othersas an unwanted federal intrusion into statesrights or private contractual matters.

Underlining the perils to implementation of the act, on Friday a federal court of appeals inAtlanta ruled that the individual mandate, thecenterpiece of the law requiring all Americansto purchase health insurance, is unconst-

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[email protected] with

the details of your event, or call(877) 248-2360, ext. 3. It will be

published in the Calendar section,space permitting.

www.lakesidecommunityhealthcare.com

Midwest Edition

Kansas Governor Vetoes ExchangeBrownback Returns Early Innovator Grant to HHS

Continued on Next Page

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Payers & Providers Page 2

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In Brief

Sanford Healthto Build New Hospital

in Northwest Minnesota

Sanford Health has made public itsplans for a new $60 millionhospital in northwestern Minnesota.

Ground will be broken for thenew Sanford Thief River FallsMedical Center and Clinic in spring2012, with construction completedin late 2014. It will centralize clinicand hospital services in onelocation.

Since 2007 Sanford Health hasoperated the 25-bed critical accesshospital in Thief River Falls that datesfrom 1932.

Also included in the project is theremodeling of a clinic that will houseoutpatient services, behavioral healthinpatient care, dialysis, and a wellnesscenter.

Sanford Health is the largest ruralnot-for-pro t health system in theUnited States. Based in eastern SouthDakota, it has 32 hospitals, 111clinics, and more than 900 physicianson staff.

Indiana UniversityHealth Bans SmokingDuring the Work Day

Employees at Indiana UniversityHealth will no longer be allowed tosmoke on breaks during the work day,according to a new policy theIndianapolis health center unveiled lastweek.

Beginning Aug. 22, workers will beprohibited from bringing into thehospital third hand smoke thecontaminants from smoking that lingeron a smokers body, hair, and clothes,which are said to include many toxinshazardous to patients.

Were not saying to people thatyou cant smoke, said Sheriee Ladd, senior vice president of human

Continued on Page 3

NEWS

Kansas Insurance Exchange (Continued from Page One)

itutional. Eventually, that issue will be decidedby the Supreme Court.

In Kansas, Gov. Brownback, who voted

against the health reform bill as a U.S. senatorin 2010, has conducted a ground war fromTopeka to block its progress.

A week after the debate about the federaldebt ceiling, he positioned the return of theearly innovator grant as a statement againstfederal overspending.

There is much uncertainty surrounding theability of the federal government to meet itsalready budgeted future spending obligations,the governor said in a statement. Every stateshould be preparing for fewer federalresources, not more. To deal with that realityKansas needs to maintain maximum exibility.

That requires freeing Kansas fromthe strings attached to the earlyinnovator grant."

Lt. Gov. Jeff Colyer, M.D.,added: Federal Medicaidmandates have cost Kansans over$400 million in the past two yearsalone. Full implementation of themandates in the presidentshealthcare law would cost billionsmore.

Kansas is the second state tomake this move. Oklahoma haddecided to return its early

innovator grant in April.We are disappointed,said Bob Tomlinson , assistantcommissioner of the KansasDepartment of Insurance .Our department wasinstrumental in applying forthe grant. We believe that a state sponsoredexchange is much better than having thefederal government run one for the state.

In a lengthy interview with Payers &Providers (14 June and 21 June editions),Praeger, the Republican insurancecommissioner, laid out her view that thehealth reform law is a reasonable marketsolution to the problem of the uninsured.

The idea behind the Kansas grant,Tomlinson said, was to make it innovativeenough that other states might want to join usin a regional exchange. Maybe glom togetherOklahoma and Nebraska and bring them in. If we could run an exchange domiciled inKansas, that might bring a few jobs to us.

As a courtesy, the governor noti ed theinsurance department of his intent andlistened to their views, Tomlinson said, butdidnt alter his decision.

None of the money had actually beengiven to the insurance department or spentyet, so the state isnt really returning any cas

to HHS.The insurance department, in collaboratiowith the Kansas Chamber of Commerce , h

just begun a series of public conversationsaround the state to gather the publics input othe exchange. The remaining events have beecanceled.

Our objective was to see where thebusiness community lies on the insuranceexchange, said Eric Stafford , the chambersernior director of government affairs. Thechamber has been looking at examples fromother states, notably California, Utah,Massachusetts, and Florida. Whether any of

those would be bene cial for Kanwe dont know yet, he said. Theris still some desire to set somethinup.

A chamber steering committeewill meet Aug. 24 to see whatoptions might be available forKansas. Just because this money hbeen sent back, I dont think thisissue is going away, Stafford said.The state could go in any of threedirections, he said: The federalgovernment could operate theexchange, the state could do it in

compliance with the ACA, orthe state could create somethion its own that doesnt meet tACA requirements.

Anna Lambertson , executdirector of the Kansas HeatlhConsumer Coalition , said sh

was disappointed that Brownback turneddown the grant. From our perspective, thatwas an opportunity for Kansas to lead thenation. We could truly have been aninnovator.

The exchange idea is de nitely not deashe said. A group of consumer advocates isworking on it. We just wont have theinnovator grant to do it. Dan Murray , Kansas director for theNational Federation of Independent Businesswhich opposes the health reform law, said hedidnt have a reaction to the governorsdecision one way or the other. But hismembers have made clear they would prefeit to be a state-run exchange, not a federalexchange, he said.

Thats under the assumption that we willbe forced to create one, that the lawwithstands the challenges.

Bob TomlinsonKansas Assistant

Insurance Commissioner


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Page 3Payers & Providers

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NEWS

In Brief

resources for the hospital. Whatwere saying is you cant bring thesecontaminants into the hospital. This isa patient-care conversation, not anemployee conversation.

As part of the policy to discouragesmoking. IU Health is also making theQuit for Life program available toemployees. A survey in 2010determined that 6% of IU Healthemployees smoked.

Illinois Re-instates LawPublishing Physicians

History and InformationA new law that went into effect lastweek in Illinois gives patients accessto extensive histories of physicians,including whether they have beenconvicted of a crime, been red, orhad a medical malpractice judgment

led against them.A web site to be developed by the

states Department of Financial andProfessional Regulation will post thephysicians medical school, specialtyboard certi cation, number of years inpractice, and whether the physicianparticipates in Medicaid. The web siteaddress is idfpr.com.

The Patients Right to Know Actwas signed by Gov. Pat Quinn on Aug.10.

One of the ironies of being anAmerican is it can be easier to ndinformation about a dishwasher that to

nd information about a doctor, saidBrent Adams , secretary of thedepartment.

The physician pro le program wasrst launched in 2008 but was taken

down in 2010 after a ruling by theIllinois Supreme Court . It was highlypopular during its brief tenure,averaging 150,000 hits per week.

Physicians will have 60 days toenter and edit information aboutthemselves before the site goes live.

The regulatory agency has been inpossession of much of this informationbut has not had the authority to makeit public. Healthcare employers arerequired to notify the agency whenthey terminate physicians privileges,and insurance companies must reportmalpractice payments.

Organizations in four Midwestern states willreceive grants to construct seven newcommunity health centers as part of a fundingaward totaling $29 million announced lastweek by the U.S. Department of Health andHuman Services. The funding, authorized by the AffordableCare Act, will create community healthcenters in 67 localities around the country,serving 286,000 patients.

Community health centers are intended toimprove the health of underserved regions andvulnerable populations. The grants willsupport new access points for primary andpreventive healthcare.

We are making an investment in thehealth of people and the health of our

communities, said HHS Secretary KathleenSebelius. We are removing barriers that standin the way of affordable and accessibleprimary health services.

Applicants for the awards included publicand nonpro t private entities, and tribal, faithbased and community-based organizations.Health center applicants in 23 states plusPuerto Rico were given grants.

In the Midwest, organizations in thesestates and localities were selected:

Illinois: Carlinville, ChicagoKansas: Wichita, PittsburgMissouri: SedaliaOhio: Columbus (2 locations)No grants were awarded in Iowa, Indiana,

Michigan, Minnesota, or Wisconsin.

Blue Cross and Blue Shield of Michigan will

have to mount a full defense against the gov-ernments lawsuit alleging it engaged in uncom-etitive practices in hospital contracting,

U.S. District Judge Denise Page Hood ruledin Detroit on Aug. 12 against the MichiganBlues motion to dismiss the case, led by theU.S. Justice Department and the MichiganAttorney Generals of ce in 2010. Shescheduled the trial to begin in April 2013. The

judge had earlier signaled her intent to allowthe case to proceed to trial in an oral statement.

The case involves so-called most-favored-nation contracting, in which Blue Crossrequires competitors to pay more than it doesfor hospital services.

It is plausible that the MFNs entered into byBlue Cross with various hospitals in Michiganestablish anticompetitive effects as to other

health insurers and the cost of health

services, the judge wrote in a 23-pageopinion.

Blue Cross said it would appeal the ruling.Helen Stojic , Blue Cross spokesman inDetroit, said the contracts guarantee lowprices for consumers. Our hospital discountare a vital part of our statutory mission toprovide Michigan residents with statewideaccess to healthcare at a reasonable cost,said Jeffrey Rumley, the companys generalcounsel, in a statement.

Blue Cross is the dominant payer inMichigan. It contracts with 70 of the 131hospitals in the state, the government casesays. Some competing health plans wererequired to pay 30% to 40% more than BlueCross at certain hospitals, the suit argues.

Michigan Blues Case Will Go to TrialU.S. Judge Rules Against Insurer in Antitrust Suit

HEALTHCARES BEST ADVERTISING V]

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HHS Awards Grants to 7 in MidwestNew Community Health Centers Seen in 4 States
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When the Affordable Care Act goes into effectin 2014, millions of previously uninsuredAmericans will receive health coverage throughprivate and public mech-anisms. Before thathappens, we need to know more precisely whohas access to care now. That was the goal of theDepartment of Health and Human Services when it commissioned a mystery shoppersurvey of primary care access.

Unfortunately, the HHS study was quicklyshot down by a vocal group of physicians andlawmakers who complained aboutgovernment spying and implied that the

clandestine method of datacollection was unethical andconstituted entrapment. One of the most vocal opponents in thisregard was the outgoingpresident of the AmericanMedical Association , Cecil B.Wilson , M.D., who said there isno need to study primary careaccess because the physicianshortage is well documented.However, he then cited the factthat 22 specialty societies areprojecting shortages.

But that was not the pointof the proposed HHS study.Relative to otherindustrialized countries, theUnited States has a disproportionate shortage of primary-care physicians compared to specialtyphysicians. It is also highly likely that access toprimary care varies considerably by geography.

It seems that the HHS study was cancelledlargely due to a misunderstanding of the valueof audit studies (the scienti c name for mysteryshopper studies). Audit methodology is a well-established research tool used both to measurequality and access in both private and public

markets. The technique is hardly new. It hasbeen used to uncover discrimination anddisparities in access to employment, mortgagelending, and fair housing. HHS has used similarmethods to audit the quality and accuracy of marketing and sales presentations led by privateMedicare plans; the Government Account-ability Of ce used secret shoppers to examineMedicare's own help line. Health insuranceplans, hospitals, and even physician of ces alsohave used secret shoppers to uncover areas forimprovement.

Importantly, when audit methods are used

for research, human subjects are protected.Scienti c institutional review boards approve thclandestine data collection because it reducesbias. The identities of the practices that are calleare never disclosed. The whole purpose of theHHS study was to monitor the system, notindividual providers. Such methods are asrigorous and ethical as randomized and double-blinded clinical trials. Just as well-designedclinical trials advance clinical care, well-designeaudit studies are a powerful tool forunderstanding the experiences of patients as theseek needed health care.

HHS was planning to use ahigh-quality survey rm, theNational Opinion ResearchCenter (NORC). The reasonabpriced ($347,000) study wouldhave targeted more than 4,000family medicine, pediatric,general medicine, internalmedicine, and obstetrics-gynecology practices in ninestates, selected based on thenumbers of uninsured adults so to generate national estimatesabout the impact of the newly

insured on primary careaccess. Practices would havbeen contacted twice bysimulated patients seeking

new patient appointments for either routine oracute care, once stating they had privateinsurance and a second time with either Medicaror Medicaid. An 11% sample of the same clinicswould have been called a third time, disclosingthe nature of the research study and asking thepractice if they are accepting new patients andwhether appointment availability varies byinsurance status. This would have clari edwhether more routine provider surveys would

give the same results.I hope that better understanding of the auditmethodology will change the public discourseand encourage HHS to reconsider the proposedstudy, which is needed to give us some reliablenational estimates about current primary carecapacity and which will determine the mostaccurate and cost-effective met hod for trackingaccess to primary care in the future.

OPINION

Who Really Has Access to Care? Audit Studies Can Give a True Picture If We Use Them

By Karin V. Rhodes, M.D.

Karin V. Rhodes, M.D., is director of theDivision of Emergency Care PolicyResearch at the University of Pennsylvania.

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Payers & Providers Midwest Edition – Issue of August 16, 2011

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