Insurers in trouble for the wrong reason: Wall St. wants them to rip you off for even MORE!

There is good news and bad news regarding health/medical insurance. Let’s start with the good:

In his Substack, “Health Care Uncovered” from August 8, 2024, Wendell Potter reports that “Wall St. is disenchanted with Medicare Advantage Plans”. This is good news in the sense that it is good when anyone is disenchanted with these plans, or any aspect of the for-profit health insurance industry. Potter notes that both CVS/Aetna and CIGNA disappointed Wall St. investors with inadequate (from their point of view) profits, compared to a year ago. I also am disenchanted, but for different reasons than Wall St. I am upset that these for-profit insurers continue to rake off such a huge amount of money that was intended, by the workers and employers who paid it, to be spend on actually delivering health care. Investors are upset that these health insurers are not raking in even more.

Potter notes that Aetna president Brian Kane resigned as a result, but appropriately writes:

I am much more concerned about the health and well-being of the 4.3 million people enrolled in CVS’s MA plans and the 6.2 million in Humana’s plans. Sadly, most will find they’re trapped in a circle of hell created by the insurance industry, unable to stay in their current Medicare Advantage plan but also unable to return to traditional Medicare because of what for them will be unaffordable Medicare supplemental policies (most of which are sold by the same big insurers that sell MA plans). Seniors have six months from the date they’re eligible for Medicare to buy a supplemental (Medigap) policy to cover out-of-pocket expenses. If they’ve been enrolled in an MA plan longer than six months, they’ll have to go through medical underwriting. That means that if they’re being treated for much of anything or, God forbid, have a “preexisting condition,” they’ll have to pay an arm and a leg for Medigap policy.

A similar piece of good news is not particularly about Medicare Advantage plans, but the overall health insurance industry/scam, in a story about data-analytics firm MultiPlan (‘Revenues Down and Stock Battered as Data Firm Faces Scrutiny’, NY Times, August 16, 2024). This one is a little harder to understand than the CVS/Aetna and CIGNA stories. They are about the fact that while they are making beaucoup bucks, it is not as much as investors would like. In the MultiPlan case, we have a company that worked for insurers to get reimbursements down (that is, to pay doctors and other healthcare providers less) and made money from it. For example, if a doctor billed $100 and MultiPlan told the insurer to only pay $50, that’s more money for the insurer (and MultiPlan), and the patient can be on the hook for the other $50. (Of course, it’s never only $100, or $50.) Since they do this mainly for “out of network” care the amount that you (the patient) can get stuck with having to pay can be – a great deal. (This can happen even when you choose an “in-network” doctor and hospital, since other doctors – like in the ER, or radiology, or even the “assistant surgeon” – can be out of network. And the ambulance almost always is).

This article was a follow-up to an earlier exposé in the NY Times ‘Insurers Reap Hidden Fees by Slashing Payments. You May Get the Bill.,’ April 24, 2024, in which the amount the patient could get stuck having to pay was as much as $100,000 – or more. The good result of this first article was a lot of opprobrium aimed at MultiPlan, resulting in some insurers being more reluctant to use them (because of the bad publicity, not because they save them money; apparently they can use other less-notorious data analytics firms to save them money), so MultiPlan is in trouble as the more recent NY Times article documents. Good. I love to see them in trouble.

The bad news is that it is likely to be you and other regular people who are screwed. There is already evidence that the pressure from investors to go back to making not just great but obscene profit margins is affecting CIGNA, CVS/Aetna, and other insurers, who are denying more claims, making it even harder to get the care that you need. Potter notes that

Humana said last week it planned to jettison “a few hundred thousand” of its Medicare Advantage enrollees that have become unprofitable. CVS says it will get rid of about 10% of its MA enrollment, which would be around 430,000 of America’s seniors and disabled people.

That’s a lot of seniors who will lose their medical coverage. I have often been critical of Medicare Advantage plans (sometimes called, more accurately, Medicare Dis-Advantage), which are NOT Medicare but are private insurance plans, usually HMOs or PPOs, paid for by Medicare funds. One of the major reasons for my criticism is that because they are private insurance, they can (and often do) deny coverage for care even when the care is approved by Medicare. Recent legislation has required these MA plans to cover Medicare-approved care, but in fact they still often deny claims. Indeed, it is often the modus operandi for these companies. They may approve the claim if you appeal, but the vast majority of clients do not appeal, and probably don’t even know that they can. If fined by the Center for Medicare and Medicaid Services (CMS) it becomes a “cost of doing business.”

But the “jettisoning” of hundreds of thousands that Potter refers to illustrates another big problem with MA. As with all insurance – not just medical – companies make money by collecting premiums and paying as few claims as possible (although medical insurance companies seem to have taken this to the extreme). One effective way to do this for healthcare is to insure healthy people. They, or their (usually former, if they’re on Medicare) employer pay the premiums but they don’t cost much money in claims. And they love getting free eyeglasses and hearing aids and gym memberships, which cost the insurance companies very little. The problem is that sometimes previously healthy people get sick, and this becomes more and more common as they age. Remember that in any given year approximately 5% of the people account for about 50% of healthcare costs, but they are not necessarily the same people the next year. Some folks get better, some folks get worse, and some really sick people die. MA plans have long “encouraged” their sickest (= most costly) patients to consider switching to traditional Medicare. Now they will be more than encouraging; they’ll drop those high-cost “losers”. Maybe you.

The MultiPlan case got good (that is, bad) coverage from the original April NY Times investigation, which resulted in it losing business as reported by that newspaper in August. But the insurers will get another data analytics firm to try to screw doctors and other providers, and the patient, you, will still be caught on the hook for many of those dollars. The system is not set up to help or protect you, and it has relatively few sanctions against companies whose business model is to find any way to screw you that will make them more money, and to use that money to hire lawyers and others to find the loopholes and to pay the politicians to ensure that they are not closed too tightly.

It’s kind of like a sport where one team able and willing to bring in ringers, violate the rules, commit all sorts of fouls and infractions, and at worst get a slap on the wrist for it. Not a fair game, but heck, that team’s owners are paying off the referees and the league.

There’s another way to do it. Absolutely strict regulation to ensure the interests of patients are the ones that are protected, and protecting the profits of the insurers is given zero weight. Penalties that are strictly enforced, and draconian and include going out of business. Even better: prohibiting profit making in any healthcare endeavor. In some countries, like Switzerland, there are private insurers, but they all have to offer the same comprehensive product, charge the same rates, and be non-profit. So how do they compete? Customer service, can you imagine!?

I like that approach!

Racism and lack of social services: The status of women's health care in the US

A recent publication from the Commonwealth Fund is the 2024 State Scorecard on Women’s Health and Reproductive Care in which they rank all the states (plus DC) for how well that care is provided and the health status of women that results. The map below gives an overall sense (darker is worse), and the entire ranked list can be found in an interactive table in the document. 

The first thing that we see is that there are no real surprises. Massachusetts is at the top and Mississippi is at the bottom. The other top and bottom states are the usual suspects for almost anything that is beneficial to people, with the Northeast doing best and the old Confederacy doing the worst. There are always some minor shifts within those groups, and in this ranking we see that Louisiana* and South Carolina are only “worse than average” not in the “bottom performing states”, while disappointing to me, Arizona and New Mexico are in the lowest group. The reasons are a little different in different states; the Arizona legislature is (narrowly; we hope to flip it this year) controlled by Republicans who are as mean and nasty as those in the deep south. New Mexico is controlled by Democrats, but it is very poor. Poor is a big component of health status, and its fingerprints are all over this data on women’s health.  ‘Despite a small rebound in women’s life expectancy in 2022, it remains at its lowest since 2006,’ says the report.

Abortion care – access to it and the quality of it – has dominated the national political discussion. I don’t want to minimize it; it is incredibly important that women can have abortions, it is a privacy issue, and it will hopefully have major negative repercussions for the party whose agenda is to limit it. That the greatest restrictions on abortion are in the same states that have the worst women’s health status is neither a coincidence nor a surprise; the people who control these states and are anti-abortion are also racists and are unwilling to provide funds to improve the health standards of people who are women, minority, or poor – and especially all three. But it goes far beyond abortion:

For health outcomes, we measured all-cause mortality, maternal and infant mortality, preterm birth rates, syphilis among women of reproductive age, infants born with congenital syphilis, self-reported health status, postpartum depression, breast and cervical cancer deaths, poor mental health, and intimate partner violence.

Abortion is not the major component of poor reproductive health status. Maternal mortality rates are shockingly high in the southeast, and worst in the Mississippi Delta. The US overall does not do very well in this area, especially as it is the richest country in the world. Data from the CIA (!) shows that in 2020, the US maternal mortality rate overall was 21/100,000, tied with Lebanon, Grenada, and Malaysia and just slightly worse than the West Bank or (pre-war) Gaza Strip. This was (and remains) much higher than Canada (11), UK (10), and most of Europe, including eastern Europe at 5 or less! (Note, showing the same dramatic racist differences as in the US, Israel is at 3). Of course, this overall rate in the US is driven by the states with the highest rates, with the worst states having a range of 34.1-51.7! While this is largely the result of excessively high rates in minority women, it is worth noting that the maternal mortality rate for white women in the US is over 19!

 

This is a good time to discuss the segmentation of results for maternal mortality (and all-cause mortality, and really most things) by race or ethnicity. In the bizarre, perverted, and of course racist excuse provided by many (racists) for why the US’ maternal mortality is so high compared to civilized countries, it is often said “it’s the minorities that drive the rate up”. In addition to ignoring the excessively high rate for US whites (19) it is scarcely an excuse; indeed, it is an indictment. It is not only that the US, unlike civilized countries, does not provide health care for everyone, essentially free of charge at the time of service (that is, paid for by tax revenues, as well as costing a lot less because of the elimination of the incredible profits extracted by middlemen such as insurance companies in the US). It also provides lousy social services of all kinds, not ensuring, as civilized countries do, housing, food, and education for everyone. These (the “social determinants of health”) are even more important than medical care in creating improved health status. And, while other countries do spend much more money than we do on providing them, the total cost per capita is probably less than what the US spends on health care alone! Of course, much of the spending (particularly on social services and health care for the poor, like Medicaid) is on a state basis; that is why there are such differences between the Massachusetts’ and Mississippi’s in this Commonwealth Fund study. And what are the practices that work? Again, no surprise:

In our scorecard, states with the lowest rates of maternal mortality had:

·       more maternity care providers (Vermont #2, Connecticut #3)

·       fewer women with no prenatal care (Vermont #1, California #3, Connecticut #5)

·       fewer women with no postpartum checkups (Vermont #1)

·       fewer uninsured women ages 19–64 (Vermont #3)

 

It cannot be stated too strongly that public funds should support a public social safety net, not bloat the profits of private companies as they do here in the US! This is most well-documented for the piggish pharmaceutical industry and the entirely unnecessary (indeed, far worse than unnecessary, destructive and evil) for-profit health insurance industry, which I have discussed many times. But it is also the other parts of the health care industry, particularly delivery systems (e.g., hospitals). Yes, the for-profits, hospitals and nursing homes and other facilities, especially those run by corporations. But it is also the ostensible “non-profits”, which do their best to emulate for-profits by doing everything possible to exclude patients without insurance or with Medicaid, pay their CEOs (and other C-suite executives) exorbitant salaries, and channel huge earnings into subsidiaries that actually own or invest in for-profit enterprises! This is documented in Why many nonprofit (wink, wink) hospitals are rolling in money by Elisabeth Rosenthal (Washington Post, July 29, 2024) and discussed by Don McCanne in Health Justice Monitor ‘Not-for-profit care begets profits’. Dr. McCanne cites a study by KFF showing even a program providing “street medicine”, healthcare for the homeless, in California is making money by getting huge amounts of Medicaid funds. Providing health care to homeless people is a good thing, something we need more of. If I had my druthers, I would rather see them making money than huge “non-profit” hospital systems (or of course straight for-profits, although those at least pay taxes), but they shouldn’t be either.

In health care, and in all social service, all the public money should go to providing direct care (OK, maybe with a 2% overhead, like Medicare – but NOT Medicare (Dis)Advantage – has). Zero dollars should go to profits (or “excess” income that can be invested for profit), bloated salaries, and the like.

We have too many people, women and others, dying because of the lack of such care.

 

*Louisiana just put the two drugs used for medication abortion, mifepristone and misoprostol, on its state’s controlled dangerous substances list, like narcotics. So look for LA’s ranking to drop!

"Direct primary care" not the answer for our health system. Beware "Project 2025"!

My last post (June 27, 2024) was about the shortage of primary care physicians (as well as NPs), and the reasons why. To save you the time of (re?)reading it, here is the bottom line: It’s the money, stupid! Primary care physicians – and NPs – get paid a lot less than those working in subspecialties, for what is indeed very hard work, encompassing breadth (everything), depth (everything), and time. I also suggested that there was a relatively simple way to address the income disparity between primary care and subspecialty practice: having Medicare revise the criteria for payment, which affects not just Medicare but also the rest of us as most insurance companies base their reimbursement rates on Medicare’s.

There have been other suggestions on how to “help” primary care. One of them, which has been seen in many places across the country for years, involves having people pay extra money (usually in an annual or monthly fee) to their primary care doctors to supplement their income and to make them more available to their patients. This phenomenon has many names -- “concierge care”, “boutique care”, “direct primary care” -- depending both on the way it is structured (and the amount of the additional fee) and how the user wants to spin it – are they portraying it as good or bad?

One place where it is portrayed as good is in the Project 2025 document issued in April by the Heritage Foundation and its allies, Project 2025 Mandate for Leadership: The Conservative Promise. This document outlines an ambitious, far-reaching, and horrifying vision for the future of the federal government once “conservatives” take the White House back. It systematically goes through every federal function, and many agencies, detailing what should be eliminated or scaled back (mostly) or expanded (rarely, mainly tax cuts for the rich). It manifests a vision of America where the corporations and the richest individuals are even richer and more powerful than they are now and the “poorest” (meaning not just the poor but working people and the majority of those who consider themselves “middle class”) are even worse off.

How does this relate to primary care? One of their (many) plans for healthcare in this country, discussed in the Health Justice Monitor, is to “Remove barriers to direct primary care”. That the Heritage Foundation is for it should in itself be a warning. They like it because it is “free enterprise” and comes from a libertarian approach that basically maintains that it is good to sell (to people who can afford it) those basic things that everyone should have as a right. Also, like most (all?) things endorsed by these “conservatives” (who mainly wish to conserve privilege) it ignores the negative impact on those folks who cannot afford to buy it.

This is not to say that everything about direct primary care as it exists currently is bad. I know many doctors who chose it because it allows them to make a living, yes, but mostly because it permits them to more fully and completely practice the kind of medicine that they trained to do because they wanted to do it, manifesting the 4 C’s of primary care – comprehensive (more or less), first contact, caring, and continuous over time. Most of them had previous jobs where they worked for big health systems (and, increasingly, private equity companies) in which they were continuously pressured to work faster, see more patients for fewer minutes, and generate more income for their employers – a concept” familiar to manufacturing jobs called “speed up” that comes from literally increasing the rate of speed of an assembly line. By charging a (modest, in many cases – this is not about true concierge care where the charges can be $10,000/year or more) fee, they are able, they believe, to take care of most of their patients’ problems, do it compassionately, see them for long enough to do so, and be available to them when they need it. These are all good things, and like most of the doctors I know who are doing this, most of the people I know who go to them as patients appreciate it and think it is beneficial.

So, what is the problem? Well, obviously, it is not available to everyone, to those who can’t afford an extra fee, and already have a problem with their insurance premiums, deductibles, and co-pays. Note that when Project 2025 says “DPC has faced many challenges from government policymakers, including overly exuberant attempts at regulation and misclassification,” the solution they propose is to ensure that the payments for it are not paid by insurance or health savings accounts. That many, most, people can’t afford DPC is the big objection to it, but there are also other problems. DPC hearkens back to the days of the old GP, where for a small fee (or a chicken) avuncular Marcus Welby could take care of all of your problems (of course, old Marcus somehow managed to stay in practice with only one patient a week). But medicine is not like that anymore. While I am a huge advocate for primary care, for family medicine, for comprehensive practice, providing all the benefits that modern medicine has available often requires more than the one primary care doctor can do. It may require specialists, both knowledge-based and surgical. It may require imaging (x-rays, CT, MRI, PET). It often requires laboratory tests and medicines. It requires other people and other resources.

Moreover, as reported in (among many places) a succinct and accurately titled Medscape Medical News article, July 2, 2024, “Better Access for a Few Patients Disrupts Care for Many”. With so few doctors (and NPs) entering primary care, the impact of those entering DPC further decreases the number of providers for those who cannot afford it. Adam Leive, one of the authors of the article on which this report is based (“On resource allocation in health care: The case of concierge medicine” J Health Economics, July 2023) is quoted as saying “Concierge medicine potentially leads to disproportionately richer people being able to pay for the scarce resource of physician time and crowding out people who have lower incomes and are sicker". This is the key point. The Medscape article also adds that ‘Leive's research showed no decrease in mortality for concierge patients compared with similar patients who saw non-concierge physicians, suggesting concierge care may not notably improve some health outcomes.’

Let’s get this straight. The Heritage Foundation’s support for DPC, and indeed elite concierge care, is because they are right-wingers whose agenda is all about further privileging the privileged and ignoring the needy. The large insurance and private equity companies who sponsor versions of DPC are doing it to make money. The primary care doctors who are engaged in it are (mostly) trying to make a living and provide quality care in miserable healthcare system (although not yet as miserable as the one Project 2025 envisions). These doctors are basically engaged in a “work-around” that does help some people, if not everyone, to have better access if not health outcomes.

But we don’t need a “work around”. What we need is a well-designed, single payer, comprehensive, cover everything, no co-pay or deductible, no necessary services that are not covered, health system. Improved and expanded Medicare for All!

Not enough primary physicians OR Nurse Practitioners: It's the money, stupid!

“Like doctors, more nurse practitioners are heading into specialty care”, a recent article in the Washington Post (June 17, 2024) by Michelle Andrews, a contributing writer for KFF News, and McKenzie Beard, makes the point that

Nurse practitioners have long been a reliable backstop for the primary-care-physician shortfall, which is estimated at nearly 21,000 doctors this year and projected to get worse. But easy access to NPs could be tested in coming years. Even though nearly 90 percent of nurse practitioners are certified to work in primary care, only about a third choose the field, according to a recent study.

That study, called ‘No One Can See You Now: Five Reasons Why Access to Primary Care Is Getting Worse (and What Needs to Change)’ was published by the Millbank Memorial Fund, and goes on at length to explain those reasons, and what needs to change.

Spoiler Alert: Like physicians, primary care nurse practitioners make less money, often for more work, and far less restricted scope of practice. Or, borrowing from an old political mantra, “It’s the money, stupid!” Or, as the WaPo article quotes Candice Chen, an associate professor of health policy and management at George Washington University, “We get what we pay for.”

It is, of course, more than just the raw amount of money. It is also how much NPs – and physicians – are paid for the amount of work that they do. This work is undervalued for primary care, based upon the notion that, somehow, being expert in a narrow specialty and knowing a lot about a little, is worth more than having a broad knowledge and being able to help a lot of people, most people, a great deal. Thus, subspecialists dramatically limit their practices to what they feel most expert at and expect the primary care clinician to do everything else. This often includes preparing people for a procedure and following them up after, which are both completely the responsibility of the person doing the procedure. Subspecialists particularly like to send paperwork back to primary care. “Your primary care doctor (or NP) will have to take care of this.” Implication: ‘Unlike primary care clinicians, I do important things.’

I would argue that managing people’s health is doing important things. Which is what the primary care clinician (family physician, general internist, general pediatrician, or the NPs that work in these fields) does. Managing the actual person, you, not just one of your diseases, or one aspect of one of your diseases; being knowledgeable about you, your life, and the interactions of all your conditions and the impact that they have on the rest of your life.

How might this manifest? Let’s say you have knee pain. You go to your family physician, who examines it, and decides that you need an x-ray. They review the x-ray and the report, and decide that you might benefit from seeing an orthopedist. They fill out the referral. Then, after the consultation and recommendation from the orthopedist, they review it, and decide how to implement the treatment. That is a lot of work. The orthopedist was done in a few minutes. Guess who gets paid, altogether, more?

Like the physicians that employ them, NPs are often very expert in their limited area (say, heart failure management), but often do not know how to manage that problem in the context of a person whose other diseases or medications may complicate that. This is where the (underpaid) primary care clinician, physician or NP, has to come in. It is a lot of responsibility, a lot of work, and often a lot of extra hours. One NP profiled in the WaPo article is taking training to become a dermatological NP. This is one of the medical fields with the highest pay/work ratios. Most of its work is not emergent and can conveniently be scheduled during the day during the week, and is less likely than many other specialties’ work to interfere with treatment for other conditions. And it is very highly reimbursed.

Should people be paid based upon the amount and difficulty of their work? If we did, people doing the most difficult work that everyone agrees needs to be done but that most people do not want to do (e.g., picking up the garbage, doing farm work in the hot sun) would be paid more than those who get fancy offices and lots of perks and boss folks around (e.g., CEOs). But difficult can have other definitions; this is really a separate discussion. In health care, for physicians (and now NPs) it should be how they contribute to the system. Currently the usual measure is money, that is, how much a given practitioner brings into the practice, or more commonly now, to their employer (often a health system), which is based on how much payors (insurers) pay for different things. That amount is not God-given, but a matter of policies that could be changed. Two mechanisms through which the amount of reimbursement is set are the RUC and the facility fee. The RUC is a group of non-governmental physicians appointed by the AMA that makes recommendations on how Medicare money should be divided up between specialists – like “one gallbladder removal is worth 6 complete examinations”, or whatever. Medicare is not required to accept their recommendations, but they usually do. And – surprise – the RUC is mostly made up of subspecialists, not primary care clinicians!

The facility fee is an amount that Medicare (and other insurers, see below) tack on to the physician fee if the practice is owned by a health system rather than a physician, and is often several times the fee for the procedure. To be clear, this means that if I receive a procedure today from a physician in their office and you get the same procedure in the same office by the same physician next week, but in the interim that practice has been acquired by a health system, the charge will be MUCH more. Medicare or your insurance may pay it, or most of it, but your co-pay will be much higher, and all of our premiums go up. This practice is hardly ever made apparent or explained in advance to patients (“Hi, thanks for calling. Just to let you know, Dr. Smith’s practice was just acquired by the MuchProfit Health System, so you will be charged three times as much for your procedure as you would have been last week.”) This is so insidious (not to say evil, but it is evil) that even doctors are often surprised, as revealed in the essay by Dr. Danielle Ofri in the New York Times (June 17, 2024) ‘Even Doctors Like Me Are Falling Into This Medical Bill Trap’ and the follow-up letters and comments from other physicians.

The fact that facility fees and the RUC are about Medicare does not mean that they do not affect the fees, cost, and reimbursement from other insurers. Almost all insurers payment rates are set as multiples of Medicare. That is, if Medicare pays $100 for something, they may pay $150 or $200 (and, more recently, those multiples are lower, with patient responsibility higher). Changing these two factors, facility fees and RUC allocations, for Medicare will affect all insurers and make a real difference in income (which is why most subspecialists and hospitals oppose them).

Should primary care clinicians be paid more, or subspecialists less, or somewhere in between? Whichever, by decreasing the difference more clinicians are likely to enter primary care specialties. And, whichever, the raking off of facility fees to increase the wealth of hospitals, not to mention the pocketing of huge profits by insurers, has to stop.