Medicare, insurers questioning payment differences based on where care is delivered

Joseph Burns

About Joseph Burns

Joseph Burns (@jburns18), a Massachusetts-based independent journalist, is AHCJ’s topic leader on health insurance. He welcomes questions and suggestions on insurance resources and tip sheets at joseph@healthjournalism.org.

Image by ShellyS via Flickr

Image by ShellyS via Flickr

Health insurers and the federal Centers for Medicare & Medicaid Services (CMS) pay much different rates for clinical services, depending on where care is delivered. Typically, hospitals are paid more than physician practices for the same clinical service.

This payment variation has drawn attention recently: CMS and the Medicare Payment Advisory Committee (MedPAC) have proposed eliminating different payments based on the site of service. In May, MedPAC Executive Director Mark Miller said Medicare should address these price differences immediately to eliminate the incentive to deliver care in high-cost settings, wrote John Tozzi at Bloomberg Businessweek.

Last year, the Society of General Internal Medicine also called for eliminating the site-of-service differential in a report on payment reform (PDF). “Medicare pays $450 for an echocardiogram done in a hospital and only $180 for the same procedure in a physician’s office,” the SGIM report said, citing MedPAC data.

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New books, recognition, jobs and more for AHCJ members

Pia Christensen

About Pia Christensen

Pia Christensen (@AHCJ_Pia) is the managing editor/online services for AHCJ. She manages the content and development of healthjournalism.org, coordinates social media efforts of AHCJ and assists with the editing and production of association guides, programs and newsletters.

The latest AHCJ members in the news are Heather Boerner, Peter Eisler, John Fauber, Kathryn Foxhall, Paul Raeburn, Margot Sanger-Katz, Michael Schroeder, Alison Young and Benita Zahn. See the latest about them:

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New Medicare Trustees report projects slightly longer solvency


Liz Seegert

About Liz Seegert

Liz Seegert (@lseegert), is AHCJ’s topic editor on aging. Her work has appeared in Kaiser Health News, The Atlantic.com, New America Media, AARP.com, Practical Diabetology, Home Care Technology report and on HealthStyles Radio (WBAI-FM, NYC). She is a senior fellow at the Center for Health, Media & Policy at Hunter College, NYC, and a co-produces HealthStyles for WBAI-FM/Pacifica Radio.

Image by Colin Dunn via flickr.

Image by Colin Dunn via flickr.

There is some good news coming out of the latest report from the Medicare Trustees. They predict that the trust fund that finances Medicare’s hospital insurance coverage will remain solvent until 2030, four years beyond last year’s projections. Per capita spending is expected to grow more slowly than the overall economy for the next few years, partially due to costs controls under the Affordable Care Act.

However, the report concludes, “notwithstanding recent favorable developments, both the projected baseline and current law projections indicate that Medicare still faces a substantial financial shortfall that will need to be addressed with further legislation.”

“Medicare Part A is moving in the right direction but the day of reckoning has merely been postponed to 2030,” said Rosemary Gibson, senior adviser at The Hastings Center and author of “Medicare Meltdown.” Unless something changes, by 2030 it will lack enough money to pay boomers’ hospital bills. “We’re not out of the woods.” Continue reading

Webcast: How value-based insurance design breaks down financial barriers to care

Joseph Burns

About Joseph Burns

Joseph Burns (@jburns18), a Massachusetts-based independent journalist, is AHCJ’s topic leader on health insurance. He welcomes questions and suggestions on insurance resources and tip sheets at joseph@healthjournalism.org.

Covering health care requires writing about the cost of care. Determining if costs are rising or falling and by how much is an integral part of the beat. After all, cost control is one of the primary concerns behind health care reform.

Mark Fendrick, M.D.

Mark Fendrick, M.D.

But A. Mark Fendrick, M.D., the director of the Center for Value-Based Insurance Design at the University of Michigan, suggests it’s time to shift the discussion from how much the United States spends on care to how well we spend money on health care. Focusing closely on costs leads health systems to use a one-size-fits-all approach to cost sharing, and requiring consumers to pay more for needed services may have a perverse effect of becoming a barrier to care, he explains. Conversely, VBID encourages a more clinically nuanced approach to financial incentives that involves setting consumers’ out-of-pocket costs for health care services and medications to motivate patients to do what research proves will help keep them healthy.

Fendrick will explain V-BID and the role it should play in the health care system during an AHCJ webcast, “How value-based insurance design breaks down barriers to care,” on Aug. 14, 1-1:30 pm ET.

V-BID seeks to align patients’ out-of-pocket costs, meaning their copayments, deductibles, and premium payments, with the value of health services, the center says. “This approach to designing benefit plans recognizes that different health services have different levels of value. By reducing barriers to high-value treatments (through lower costs to patients) and discouraging low-value treatments (through higher costs to patients), health systems that incorporate the concepts of V-BID can improve patient outcomes,” it says. Continue reading

Exploring the geography of violent death

Joe Rojas-Burke

About Joe Rojas-Burke

Joe Rojas-Burke is AHCJ’s core topic leader on the social determinants of health. To help journalists broaden the frame of health coverage to include factors such as education, income, neighborhood and social network, Rojas-Burke will hunt for resources, highlight excellent work and moderate discussions with journalists and experts. Send questions or suggestions to joe@healthjournalism.org or tweet to @rojasburke.

Measured by rates of violent death, the most dangerous counties in the United States have rates that are more than 10 times higher than the safest counties.

As you can see in the map below, rates vary from less than 10 to more than 100 violent deaths per 100,000 population, based on homicides, police shootings, and suicides in the years 2004 through 2010. (Counties with rates based on 20 or fewer deaths are unreliable and are marked as suppressed.)

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I generated this map and the others below using WISQARS (Web-based Injury Statistics Query and Reporting System), an interactive database system that provides customized reports of injury-related data collected by the Centers for Disease Control and Prevention. The mapping module draws on seven years of data, the amount needed to produce reliable county-level injury-related death rates, according to the CDC, and it is a powerful tool to explore health disparities. Continue reading

Going deep on hospital closures and their human impact

Joe Rojas-Burke

About Joe Rojas-Burke

Joe Rojas-Burke is AHCJ’s core topic leader on the social determinants of health. To help journalists broaden the frame of health coverage to include factors such as education, income, neighborhood and social network, Rojas-Burke will hunt for resources, highlight excellent work and moderate discussions with journalists and experts. Send questions or suggestions to joe@healthjournalism.org or tweet to @rojasburke.

Pittsburgh’s dominant health system closed a hospital in the economically depressed town of Braddock four years ago and soon after opened a new hospital in the more affluent suburb of Monroeville, Pa.

Lillian Thomas

Lillian Thomas

Lillian Thomas of the Pittsburgh Post-Gazette wanted to know how common it was for hospital corporations to abandon disadvantaged towns and inner cities. That was the beginning of a reporting journey that has produced a hard-hitting, ongoing series by Thomas and colleagues at the Post-Gazette and Milwaukee Journal Sentinel.

The first installments revealed how most of the defunct hospitals were small to mid-size community hospitals and public hospitals that had served poor urban neighborhoods. The closures left many low-income neighborhoods without an effective safety net, undermined efforts to recruit doctors and did away with high-wage jobs for local residents. An incredibly detailed interactive map allows readers to track where old hospitals have closed and new ones have opened in cities across the U.S. since 1991.

I asked Thomas to share how she approached the project and mustered the resources to pull it off. Read more …

ACA rules force health insurers to increase spending on care delivery

Joseph Burns

About Joseph Burns

Joseph Burns (@jburns18), a Massachusetts-based independent journalist, is AHCJ’s topic leader on health insurance. He welcomes questions and suggestions on insurance resources and tip sheets at joseph@healthjournalism.org.

The percent of premium dollars allocated to administrative costs and profit dropped in all markets since the introduction of the 80/20 rule.

The percent of premium dollars allocated to administrative costs and profit dropped in all markets since the introduction of the 80/20 rule. (Click to enlarge image.)

A new report on how health insurers are complying with the medical loss ratio rules shows insurers spent more on care delivery and less on profit and overhead in 2013 than they did in the previous two years.

The report, “Consumers Benefited From 80/20 Rule in 2013,” from the federal Department of Health and Human Services (HHS) shows that the percentage of consumers insured by companies that met or exceeded the requirements under the MLR rules has risen each year since the rules became effective in 2011. Tables accompanying the report offer some great story ideas for journalists who want to dig deeper into why insurers in their states would pay rebates to consumers rather than put those funds into care delivery.

Also called the 80/20 rules, the MLR regulations in the Affordable Care Act require insurers to spend a minimum of 80 percent of premium income on delivering care (and not on profit and overhead) in the small group and individual markets and at least 85 percent of premium income on care delivery in the large group market.

Under the MLR rules, if insurers fail to spend at least at these levels, they have to rebate the difference to consumers. Those rebates are due by Aug. 1.

“In the first three years of the MLR program, individual and employer plan enrollees received or will receive over $1.9 billion in refunds,” the HHS report said. Continue reading

Welcome to AHCJ’s newest members

Len Bruzzese

About Len Bruzzese

Len Bruzzese is the executive director of AHCJ and its Center for Excellence in Health Care Journalism. He also is an associate professor at the Missouri School of Journalism and serves on the executive committee of the Council of National Journalism Organizations.

Please welcome these new professional and student members to AHCJ. All new members are welcome to stop by this post’s comment section to introduce themselves.

  • Meghan Hoyer, data journalist, USA Today, McLean, Va. (@meghanhoyer)
  • Elisa Lala, staff writer and health reporter, The Press of Atlantic City, Pleasantville, N.J.
  • Robyn Norwood, independent journalist, Long Beach, Calif. (@RobynNorwood)
  • Katja Ridderbusch, independent journalist, Atlanta
  • Gina Roberts-Grey, independent journalist, Baldwinsville, N.Y. (@GinaRobertsGrey)

If you haven’t joined yet, see what member benefits you’re missing out on: Access to more than 50 journals and databases, tip sheets and articles from your colleagues on how they’ve reported stories, conferences, workshops, online training, reporting guides and more. Join AHCJ today to get a wealth of support and tools to help you.

Reporting team scrutinizes Medicare Advantage

Liz Seegert

About Liz Seegert

Liz Seegert (@lseegert), is AHCJ’s topic editor on aging. Her work has appeared in Kaiser Health News, The Atlantic.com, New America Media, AARP.com, Practical Diabetology, Home Care Technology report and on HealthStyles Radio (WBAI-FM, NYC). She is a senior fellow at the Center for Health, Media & Policy at Hunter College, NYC, and a co-produces HealthStyles for WBAI-FM/Pacifica Radio.

Fred Schulte

Fred Schulte

The Center for Public Integrity’s series unearthing potential fraud and waste under the Medicare Advantage program had little help — and apparently little interest — from the Centers for Medicare & Medicaid Services. The insurance program, which Congress established to help control health care costs for older adults, could leave taxpayers on the hook for more than $36 billion, as AHCJ member Fred Schulte and the rest of the investigative team uncovered.

In this “How I did it” article, Schulte explains how the series follows up on CPI’s 2012 Medicare costs investigation, the extensive lengths taken to try to obtain CMS records, work-arounds and other sources the team used to piece together a puzzle that paints a clear picture of improper billing, missed opportunities by regulators, lack of oversight, and industry influence.

Hospital survey data updated, with changes

Jeff Porter

About Jeff Porter

Jeff Porter is the special projects director for AHCJ and plays a lead role in planning conferences, workshops and other training events. He also leads the organization's data collection and data instruction efforts.

AHCJ has just updated its easy-to-use Hospital Consumer Assessment of Health Providers and Systems (HCAHPS) survey data to include the latest release of the data by the U.S. Centers for Medicare and Medicaid Services and reflect changes in the data by CMS.

The data include survey questions about how doctors and nurses communicate, how hospitals are controlling patients’ pain, how hospitals are keeping clean and quiet, and more. AHCJ also creates a spreadsheet file that contains a timeline of the overall ratings of hospitals, with results from October 2006 to September 2013.

Each data release now includes the beginning and ending dates covered in the survey. The latest hospital survey results cover Oct. 1, 2012, through Sept. 30, 2013.