Ilovebenefits’s Blog

Just another weblog

More Procedures = Higher Premiums and Higher Costs

Hospital Discharge Survey: Hip and Knee Joint Replacement Procedures

  • From 1996 to 2006, the hospital discharge rate for total hip replacement increased by one-third, and the discharge rate for knee replacement increased by 70%.
  • In 2006, total hip replacement rates were similar among men (18.1 discharges per 10,000 population) and women (20.5) . Discharges for partial hip procedures were about twice as common among women
    (23.9 per 10,000 for age 45 years and over) as men (13.0 per 10,000). Partial hip procedures, which are often used to treat fractures, were also more common among older persons.
  • In 2006, knee replacement discharges were more common among women 45 years of age and over (54.0 per 10,000) than men (34.9). As with hip replacement procedures, knee replacement discharges were more than three times as high for those 65 years of age and over (84.1), compared with those 45–64 years of age (25.7).

Source: CDC/NCHS, National Hospital Discharge Survey.
Publication: Health, United States, 2009.


March 8, 2010 Posted by | Cost, healthcare, hospitals, insurance, Medicare, Reimbursement | , , , , | Leave a comment

Extension of the Medicare Physician Payment Update

President Signs Into Law Temporary Extension of COBRA Premium Subsidy, Unemployment Insurance, and Medicare Physician Payment Update

President Obama signed into law on March 2, 2010 a bill to temporarily extend emergency unemployment benefits, the COBRA premium subsidy program, and a Medicare physician payment update, along with other programs, all of which had expired on February 28. The “Temporary Extension Act of 2010” (H.R. 4691), which was passed by the Senate on March 2 and the House on February 25, continues the emergency unemployment compensation program through April 5, 2010. It also extends the 65% COBRA premium subsidy included in the American Recovery and Reinvestment Act (ARRA) (P.L. 111-5) through March 31, 2010. In addition, the law expands eligibility for the COBRA premium subsidy to certain individuals who are involuntarily terminated after they experience a qualifying event of reduction in hours. Also included in the law is an extension of the Medicare physician payment update, which sustains current Medicare payment rates for physicians (preventing a 21% payment reduction) through March 31, 2010.

The full text of H.R. 4691 is available here.

March 3, 2010 Posted by | Federal Government, healthcare, Medicare, physicians | , , , , , | Leave a comment

Areas of Agreement

Editor’s note: Maybe so, but it is all about the details and what it takes to change anyone of these items. There is massive interconnection in the health care system.

Areas of Agreement in Health Reform Legislation

Percent saying it is “extremely” or “very important” that each element be passed into law:

  Total Democrat Independent Republican
At least six in ten in each group believe important        
   1. Reforming the way health insurance works 76% 85% 79% 64%
   2. Providing tax credits to small businesses 72% 77% 70% 67%
   3. Creating a health insurance exchange/marketplace 71% 78% 71% 67%
   4. Helping close the Medicare “doughnut hole” 71% 78% 70% 66%
   5. Expanding high risk insurance pools 70% 79% 67% 61%
At least six in ten in two groups believe important        
   6. Providing financial help for low/middle income 68% 88% 64% 48%


Note: Question wording abbreviated.

Data Source: Kaiser Family Foundation Health Tracking Poll (conducted February 11-16, 2010).

Publication: Kaiser Family Foundation, February 23, 2010.

February 25, 2010 Posted by | Federal Government, healthcare, insurance, Medicare | , , , , | Leave a comment

Is This the Same Fox in Sheep’s Clothing


Washington (CNN) — The Obama administration raised the stakes in the health care debate Monday, releasing a new blueprint that seeks to bridge the gap between measures passed by the Senate and House of Representatives last year. If enacted, the president’s sweeping compromise plan would constitute the biggest expansion of federal health care guarantees since the enactment of Medicare and Medicaid more than four decades ago.

The White House said it would extend coverage to 31 million Americans. Among other things, the White House said it would expand Medicare prescription drug coverage, increase federal subsidies to help people buy insurance and give the federal government new authority to block excessive rate hikes by health insurance companies. It increases the threshold — relative to the Senate bill — under which a tax on high-end health insurance plans would kick in. As with both the House and Senate plans, it includes significant reductions in Medicare spending in part through changes in payments made under the Medicare Advantage program.

President Obama’s plan does not include a government-run public health insurance option, an idea strongly backed by liberal Democrats but fiercely opposed by both Republicans and key Democratic moderates. It also eliminates a deeply unpopular provision in the Senate bill worked in by Sen. Ben Nelson, D-Nebraska, that would exempt his Midwestern state from paying increased Medicaid expenses.

Administration officials said Obama’s measure would cut the deficit by $100 billion over the next 10 years. They estimate the total cost of the bill to be $950 billion in the next decade. The Senate bill would cost an estimated $871 billion, according to the nonpartisan Congressional Budget Office, while the more expansive House plan has been estimated to cost more than $1 trillion.  (A DEFICIT REDUCTION IS NOT A TAX CUT. THERE ARE BETWEEN $871 AND $950 BILLION OF TAX INCREASES.)

The release of Obama’s plan sets the stage for a critical televised health care summit Thursday with top congressional Republicans. The White House is trying to pressure GOP leaders to present a detailed alternative proposal in advance of the meeting. “We view this as the opening bid for the health meeting” on Thursday, White House communications director Dan Pfeiffer told reporters. “We took our best shot at bridging the differences” between the House and Senate bills. “It is our hope the Republicans will come together around [their] plan and post it online” before the meeting.

Pfeiffer said Obama will come to Thursday’s meeting “with an open mind.” The president’s willing to back decent Republican ideas if the two sides can have an “honest, open, substantive discussion” in which “both parties can get off their talking points,” he said.

GOP leaders have indicated they will attend the meeting but have urged Democrats to scrap the Senate and House bills completely. They characterized Obama’s proposal Monday as setting the stage for a meeting that will amount to little more than political posturing. “The president has crippled the credibility of this week’s summit by proposing the same massive government takeover of health care based on a partisan bill the American people have already rejected,” said House Minority Leader John Boehner, R-Ohio.

“This new Democrats-only backroom deal doubles down on the same failed approach that will drive up premiums, destroy jobs, raise taxes and slash Medicare benefits. This week’s summit clearly has all the makings of a Democratic infomercial.” Senate Minority Leader Mitch McConnell, R-Kentucky, released a statement calling the plan “disappointing that Democrats in Washington either aren’t listening or are completely ignoring what Americans across the country have been saying.”

White House press secretary Robert Gibbs dismissed the GOP criticisms, arguing that Republican leaders had asked for this week’s meeting for months. “If they’re not the party of no, Thursday’s the perfect venue to be the party of yes,” Gibbs said. Highlights of Obama’s proposal Under Obama’s plan:

• The health and human services secretary would work with a seven-member board of doctors, economists and consumer and insurance representatives to review premium hikes. This Health Insurance Rate Authority would provide an annual report to recommend to states whether certain rate increases should be approved, although the secretary could overrule state insurance regulators. (WHAT ABOUT STATES RIGHTS? MORE OF A FEDERAL TAKEOVER OF HEALTHCARE.)

• New health insurance subsidies would be provided to families of four making up to $88,000 annually, or 400 percent of the federal poverty level. Compared with the Senate bill, Obama’s proposal lowers premiums for families making between $44,000 and $66,000, according to the White House. Compared with the House legislation, it lowers premiums for families making between $55,000 and $88,000.

• The Medicare prescription drug “doughnut hole” would be closed by 2020. Under current law, Medicare stops covering drug costs after a plan and beneficiary have spent more than $2,830 on prescription drugs. It starts paying again after an individual’s out-of-pocket expenses exceed $4,550. (ONE WAY THEY PROPOSE TO DO THIS IS TO ELIMINATE THE 28% TAX DEDCUTIBILITY FOR COMPANIES WHO FUND RETIREE DRUG BENEFITS. WHEN THIS WAS PUT IN, IT WAS DEMONSTRATED THAT WITHOUT IT, EMPLOYERS WOULD CEASE SPONSORING RETIREE DRUG PLANS.)

• A 40 percent tax would be imposed on insurance companies providing so-called “Cadillac” health plans valued at more than $27,000 for families. The tax would kick in starting in 2018 for all plans. In contrast, the Senate bill would apply the tax to plans valued at more than $23,000 for families. The House bill does not include the tax, which labor unions vehemently oppose. (EMPLOYERS WILL NOT PAY THIS EXCISE TAX. THEY WILL CONTINUALLY SKINNY DOWN THE BENEFITS OFFERED, SHIFTING THE COST TO EMPLOYEES. THEY WILL DO THIS TO AVOID PAYING THIS TAX. PEOPLE WILL PAY THIS COST DIRECTLY.)

• The federal government would assist states by picking up 100 percent of the costs of expanded Medicaid coverage through 2017. The federal government would cover 95 percent of costs for 2018 and 2019, and 90 percent in the following years. (SO WHERE WILL THE STATES COME UP WITH THESE INCREMENTAL MANDATED DOLLARS?)

• Health insurance exchanges would be created to make it easier for small businesses, the self-employed and unemployed to pool resources and purchase less expensive coverage.

• Total out-of-pocket expenses would be limited, and insurance companies would be prevented from denying coverage for pre-existing conditions. Insurers would be barred from charging higher premiums based on a person’s gender or medical history. (LIMITING OUT OF POCKED EXPENSES? SEE STANDARD MEDICARE DEDUCTIBLES OR HIGH DEDUCTIBLE HEALTH PLAN FEDERALLY MANDATED OUT OF POCKET DEDUCTIBLES AND MAXIMUMS IN THE HEALTH SAVINGS ACCOUNT ELIGIBLE PLANS. IS THIS WHAT WE ARE ALL HEADED TOWARDS IRRESPECTIVE OF INCOME?)

• Individuals under Obama’s plan would be required to purchase coverage or face a fine of up to $695 or 2.5 percent of income starting in 2016, whichever is greater. The House bill, in contrast, would have imposed a fine of up to 2.5 percent of an individual’s income. The Senate plan would have required a person to buy coverage or face a fine of up to $750 or 2 percent of his or her income. All three plans include a hardship exemption for poorer Americans. (BACK TO INDIVIDUAL RIGHTS — CAN THE GOVERNMENT REQUIRE PEOPLE TO PURCHASE CERTAIN GOODS AND SERVICES?)

• Companies with more than 50 employees under Obama’s plan would be required to pay a fee of $2,000 per worker if the company does not provide coverage and any of that company’s workers receives federal health care subsidies. The first 30 workers would be subtracted from the payment calculation. As with the individual requirement, this represents a compromise between the House and Senate plans.

• Some $40 billion in tax credits would be established for small businesses to help them provide health care options for their employees.

• States could choose whether to ban abortion coverage in plans offered in the health insurance exchanges. Individuals purchasing plans through the exchanges would have to pay for abortion coverage out of their own funds. The White House is following the Senate’s lead. The stricter House version banned abortion coverage in private policies available in the exchange to people receiving federal subsidies. (IS THIS A REAL DIFFERENCE FROM NOT FUNDING ABORTIONS? SO LONG AS ABORTIONS ARE LEGAL, I SUPPOSE ANYONE CAN PAY FOR THEM. THIS AMOUNT TO TREATING PEOPLE WHO DO NOT HAVE THE MEANS DIFFERENTLY. IF THAT IS OKAY HERE, WHY ARE WE PROVIDING SUBSIDIES FOR SOME THINGS AND NOT FOR OTHERS?)

• Illegal immigrants would not be allowed to buy health insurance in the health insurance exchanges. They would be exempted from the individual insurance mandate. As with abortion, the White House is adopting the Senate’s language.


February 22, 2010 Posted by | Federal Government, healthcare, Medicare | , , , | Leave a comment

Health Reform Act II

Editor’s note: Here is what apparently is going on behind the scenes to try to move health reform forward. From this report it appears that the ‘Health Summit’ is simply political maneuvering, there will still be significant Medicare cuts, and a cadillac tax that will cause health plans to slim down their coverage over time and shift more cost to the consumer.


WHERE IT STANDS – President Obama, House Speaker Pelosi and Senate Majority Leader Reid are preparing to begin the reconciliation process after next week’s bipartisan White House health care summit. ‘They are coming out of the summit guns-a-blazing and they’re committed to reconciliation,’ said one Democratic insider. All three are dedicated to comprehensive reform, but Reid and White House chief of staff Rahm Emanuel are cautioning that ‘it’s going to be a heavier lift than a lot of people expect it to be,’ said a senior Democratic official. ‘It’s going to cause political problems.’ Not the least of which is how Democrats pivot to reconciliation, a procedure Republicans view as a partisan ramrod, shortly after Obama hosts the GOP to talk about bipartisan solutions. Right now, Democratic leaders are considering a $200 billion reconciliation bill that includes more affordability subsidies, the union-tweaked Cadillac tax and filling in the gap in seniors’ drug coverage, which would be paid for primarily by additional Medicare cuts and an increase in Medicare payroll taxes above those in the Senate bill, an insider said. Still, Democratic sources stress that neither Pelosi nor Reid know if they have the votes to pass a reconciliation bill. And despite rumors that a House-Senate deal is imminent, a senior Democratic aide said there is virtually no chance it gets done before next week’s summit. That leaves insiders suspecting that Obama will release a set of principals or conceptual language that includes the greatest hits from the House and Senate bills.

February 19, 2010 Posted by | Federal Government, healthcare, Medicare | , , , , | Leave a comment

Fee for Service Needs to Change to Fee for Care

Lower Medicare Fees Do Not Increase Volume Of Patient Care
However, reimbursement rates were shown to affect the kind of services and tests provided.

February 12, 2010 Posted by | Cost, healthcare, insurance, Medicare | , , , , | Leave a comment

The ‘Doc Fix’ and the AMA

Editor’s note: While the proposed HIRE Act postpones the Medicare reimbursement cut (of 21%) to physicians, the AMA is condemning the short-sighted nature of the proposal. Congress has continually applied a patchwork fix to the issue. They ulimately will need to decide to take one direction or another on this very thorny issue.


AMA calls for permanent fix to Medicare fee cuts for doctors
The American Medical Association condemned what it called the Senate’s short-term fix to block the 21% cut in Medicare reimbursements for doctors. The group said the provision, which is included in the Senate jobs bill, is a short-sighted solution that “increases the size of the cut and cost of reform and makes it very difficult for physicians to care for seniors and military families.” The AMA instead endorsed a measure tied to the health reform legislation that offers a permanent solution to the payment formula. BusinessWeek/Bloomberg (2/10)

February 11, 2010 Posted by | Federal Government, healthcare, Medicare | , , , , , | Leave a comment

The ‘Doc Fix’ is in the HIRE Act

Extension of Expiring Health Care Provisions. 


The draft HIRE Act also extends health provisions, a number of which expired at the end of 2009.  These provisions include a seven-month extension of the sustainable growth rate update formula.  Without this fix, physicians participating in Medicare face a 21 percent reduction in payments.  The bill also extends the exceptions process for Medicare therapy caps and extends payment provisions for mental health providers, ambulance services, physicians in areas where the work geographic practice cost index (GPCI) is below 1.0, certain physician pathology services, the rural hospital flexibility (Flex) program, improved payments for outpatient services in hospitals in rural areas, direct billing for Indian health service providers, Medicare hospital wage index reclassifications under the section 508 program, provisions concerning long-term acute care hospital services, and certain Medicare Advantage plans, including special needs plans, cost plans and senior housing programs. The draft bill would also provide an accreditation exemption for certain pharmacies that furnish durable medical equipment and would clarify eligibility for physician health information technology incentive payments. And finally, the draft bill would keep the 2009 federal poverty guidelines to protect people in means-tested programs from losing benefits and includes a provision to disregard refundable tax credits and refunds as income for twelve months from receipt. The total cost of the health extenders provisions is about $10 billion over ten years.

February 11, 2010 Posted by | Federal Government, healthcare, Medicare, physicians | , , , , | Leave a comment

Prices Don’t Drive Regional Medicare Spending Variations:

How much of the variation in Medicare spending can be explained by Medicare’s paying more to compensate for the higher cost of goods and services in high-spending areas? An article in Health Affairsanalyses Medicare spending after adjusting for local price differences in 306 hospital referral regions. The price-adjustment analysis resulted in less variation in what Medicare pays regionally, but not much. The findings suggest that utilization – not local price differences – drives Medicare regional payment variations.
Technical report Appendix data

February 11, 2010 Posted by | Cost, healthcare, Medicare | , , , | Leave a comment

‘Perverse incentive’ in current health care system, says expert

McAllen, Texas (CNN) — Even as the health care debate turns to blood sport in Washington, some analysts say the debate is ignoring one of the leading causes of rising costs: the way health care providers are paid.

“They are rewarded for more services, not better services. They are rewarded for more care, not better care,” said Dr. Elliott Fisher, a lead researcher for the Dartmouth University Atlas of Health. “Most of the U.S. health system is paid simply for each service, regardless of the results of that service.”

The result is what Fisher calls a “perverse incentive” to order more medical services. That may bring a doctor or hospital a healthier bottom line, but it does not provide any better health for patients while driving up costs.

February 11, 2010 Posted by | Economics of Health care, healthcare, hospitals, insurance, Medicare, quality | , , , , | Leave a comment