Tea Leaves

It’s Not Just Politics

The newly elected members of the upcoming 112th US Congress have vowed to dismantle (or halt) the Patient Protection and Affordable Care Act (PPACA).   Mr. John A. Boehner (R. Ohio), the new House Majority Leader, promises to replace it with “a common-sense approach to health care reform” (Boehner, 10/15/10).  Many news analysts predict that the White House will counter with a generous application of the Presidential veto.

So, once again we are encouraged to take a “wait and see” attitude about health reform.  After all, with or without compromise, big policy change takes time and government always has the advantage of time.   However I remind you that while health care reform is a political issue —  it is not limited to politics.    Ideas are the ultimate durable good and the market is already adopting ideas that are contained in the PPACA.  This week’s lead article on Accountability Care Organizations is an example.   Verity Reports has also previously noted how insurance companies are negotiating cost bundling agreements with providers.

My firmed looked at the US Chamber of Commerce list of health reform priorities to give you a hint of which other components of the PPACA may have traction outside the public policy arena.  The Chamber outlines a three-prong approach to health reform: 1) get costs under control, 2) reform the insurance system, and3) create a vibrant market place.  This approach supports the development of health information technology and comparative effectiveness research.  It emphasizes the importance of health wellness and preventive care.  It supports pay-for-performance, consumer-driven health options and long-term care reform.  The Chamber also supports eliminating the use of pre-existing conditions or health status in insuring individuals, obligating individuals to obtain health insurance coverage, and creating subsidies for individuals who cannot afford coverage.

To be sure the Chamber takes real issue with the refusal  of the Congress to move forward with other issues that are critical to its members such as tort reform.  Neither is the Chamber satisfied with how businesses may be effected by policies such as state insurance risk pools.   But on the surface their agenda has a good deal in common with PPACA.    The devil may be in the details but it appears that you can’t keep a good idea down.

Tea Leaves is an opinion column written by Colette Knuth.  Dr. Knuth is a doctorate-level trained health policy analyst and CEO of The Colette Steward Group.  The Colette Steward Group provides health policy research and organizational development services to the health care sector.  Visit us at: www.thestewardgroup.com.

Fundamental changes to the business of health care

If you listen to the news pundits you are led to believe that health care reform is not a done deal.  Upon closer inspection we find that implementation is well underway and that current initiatives are changing basic assumptions about patient care.

The Steward Group finds that current initiatives are changing the basic assumptions about US health care

In anticipation of the full roll-out of the Patient Protection and Affordable Care Act, the executive branch of the federal government is steadily changing the conventions that have defined US health care.  In this issue of Verity Reports, we focus on two conventions that were knocked down within the last few weeks:

• Medicare providers don’t have to take fraud seriously.
• Health reform doesn’t give hard-working Americans a safety net.

Medicare fraud:  It is time to take it seriously

The medical billing community already knows that Medicare carriers have become increasingly vigilant, however, health reform has raised the stakes.  The Centers for Medicare & Medicaid Services (CMS) is changing from a “pay and chase” to a fraud prevention strategy.

In a press release the DOJ reports that the “Affordable Care Act requires providers and suppliers to establish plans detailing how they will follow the rules and prevent fraud as a condition of enrollment in Medicare, Medicaid, or CHIP.”

Suppliers of durable medical equipment, home health agencies, and Community Mental Health Centers (CMHCs) have been targeted as high fraud risks.

The Steward Group conducts trends analyses to predict how an industry and consumer needs might change over time.

Since May 2009, HEAT, the Medicare Fraud Strike Force, composed of federal and state staff from the Office of the Inspector General and Department of Justice, has charged 465 defendants with defrauding Medicare of more than $830 million dollars.

For example, Drs. Juan De Oleo and Rosa Genao face possible prison sentences of a maximum of 10 to 20 years for health care fraud, money laundering, and the destruction or alteration of records.  In addition, government agents are  recruiting the assistance of Medicare beneficiaries to help stop fraudulent charges to the program.  A fraud hotline can be called 24/7 to report program abuses.

Government funded healthcare:  Benefiting the middle-class

Only a few days ago, Kathleen Sebelius, Secretary of the Department of Health and Human Services announced that nearly 2,000 employers were accepted  into the Early Retiree Reinsurance Program (ERRP). Modern Healthcare reports that the “approved applications represent nearly every sector of the economy: 32% from businesses, 26% from state and local governments, 22% from union sponsors, 14% from schools and other educational institutions, and 5% from not-for-profits.  Reimbursements will begin this fall for the early retirees of these companies.  ”  Modern Healthcare.com.

New rules for new health care

With just these two programs, the landscape of US health care is already changed.

The White House administration has brought Medicare fraud penalties into the realm of street crime.  It has also redefined Medicare as a program that is not just for the elderly and may make supporters of the very people who are most likely to believe that health reform will not benefit to them.

Image:  Pete Souza