Monday, December 10, 2012

Dangerous Assumptions Part II

Dangerous Assumptions..........Part II

Things are about to get worse....much worse.

HHS released some further details about the rollout of the Accountable Care Act. No doubt this is why Congress denied reading the bill...as per Nancy Pelosi.

It is apparent that congress did not want this legislation to be successful. They passed it with total disregard for how it would be implemented or the secondary consequences therof. They essentially wanted to take credit for passing the bill and letting it's outcome fall where it may.

Fact ! Just how disjointed the medicare planning process is,

Medicare SGR payment cut looms as January 1 deadline approaches

Congress has three weeks left to stop the 26.5 percent Medicare sustainable growth rate (SGR) physician payment cuts (to take effect on January 1, 2013) before they adjourn for the holidays. The California Medical association (CMA) urges physicians to keep the pressure on Congress to stop these cuts.

Comprehensive reform of the Medicare physician payment system is long overdue. Working together, CMA, American Medical Association, national specialty societies and state medical associations are currently developing an alternative Medicare payment system that will stabilize the Medicare program and promote high quality, high value care. Physicians are leading the way. But first, Congress must act responsibly and stop the scheduled Medicare SGR payment cut of 26.5 percent. Such cuts seriously threaten the viability of California physician practices and your ability to care for patients.

This has only been going on the past fifteen years or more. Congress keeps kicking the can down the road. They even failed to address this key point in the accountable care act, when pointed out by physician groups.

Fact !

Failure to launch ! ACA is barely out of the gate and funds are being diverted. (nice planning)

In recent days, Senate and House Republicans have floated a proposal to take the $10-30 billion earmarked under the Affordable Care Act (ACA) to provide much needed Medicaid payment increases for primary care physicians and to use that money instead to help avoid the fiscal cliff or fund the SGR. CMA strongly opposes such a move.

Fact ! Medicaid can not afford to have 3 million more eligibles

California’s Medi-Cal rates are already nearly the lowest in the nation. Currently, three quarters of the physicians in California cannot afford to participate in the program and 50 percent of Medi-Cal patients can't find a doctor. The gaping hole in the safety net will be further exacerbated as there will be 3 million uninsured who will be newly eligible for Medi-Cal in 2014 under the ACA.

Fact ! More regulations and reporting are descending on the healthcare community.

Medicare FFS Physician Feedback Program/Value-Based Payment Modifier details the overall mechanism for measuring and regulating quality of care.

The Value-based Payment Modifiers will depend upon a new and untested ICD 10 code with highly detailed specifics to link to CPT billing codes. The chances for errors and denied reimbursement are magnified exponentially.
The overall regulations include:
Section 3007 of the Affordable Care Act mandated that, by 2015, CMS begin applying a value modifier under the Medicare Physician Fee Schedule (MPFS). Both cost and quality data are to be included in calculating payments for physicians.

Physicians in groups of 100 or more eligible professionals who submit claims to Medicare under a single tax identification number will be subject to the value modifier in 2015, based on their performance in calendar year 2013.
All physicians who participate in Fee-For-Service Medicare will be impacted by CMS’s emphasis on reporting quality data through PQRS and by 2017 will be affected by the value modifier.

Report Templates and Methodologies Disseminated in 2010, and plans for 2013-2017

The enactment of the Accountable Care Act and participation in Medi-caid requires that all physicians must re-enroll in 2013. (over 750,000 applications).

Fact ! Expect the Unexpected:

New insurance fee in health overhaul law likely to hit consumers

Published December 10, 2012

Associated Press

Your medical plan is facing an unexpected expense, so you probably are, too. It's a new, $63-per-head fee to cushion the cost of covering people with pre-existing conditions under President Obama's health care overhaul.

The charge, buried in a recent regulation, works out to tens of millions of dollars for the largest companies, employers say. Most of that is likely to be passed on to workers.

Employee benefits lawyer Chantel Sheaks calls it a "sleeper issue" with significant financial consequences, particularly for large employers.

"Especially at a time when we are facing economic uncertainty, (companies will) be hit with a multi-million dollar assessment without getting anything back for it," said Sheaks, a principal at Buck Consultants, a Xerox subsidiary.

Based on figures provided in the regulation, employer and individual health plans covering an estimated 190 million Americans could owe the per-person fee.

The Obama administration says it is a temporary assessment levied for three years starting in 2014, designed to raise $25 billion. It starts at $63 and then declines.

Most of the money will go into a fund administered by the Health and Human Services Department. It will be used to cushion health insurance companies from the initial hard-to-predict costs of covering uninsured people with medical problems. Under the law, insurers will be forbidden from turning away the sick as of Jan. 1, 2014.

The program "is intended to help millions of Americans purchase affordable health insurance, reduce unreimbursed usage of hospital and other medical facilities by the uninsured and thereby lower medical expenses and premiums for all," the Obama administration says in the regulation. An accompanying media fact sheet issued Nov. 30 referred to "contributions" without detailing the total cost and scope of the program.

Of the total pot, $5 billion will go directly to the U.S. Treasury, apparently to offset the cost of shoring up employer-sponsored coverage for early retirees.

The $25 billion fee is part of a bigger package of taxes and fees to finance Obama's expansion of coverage to the uninsured. It all comes to about $700 billion over 10 years, and includes higher Medicare taxes effective this Jan. 1 on individuals making more than $200,000 per year or couples making more than $250,000. People above those threshold amounts also face an additional 3.8 percent tax on their investment income.

But the insurance fee had been overlooked as employers focused on other costs in the law, including fines for medium and large firms that don't provide coverage.

"This kind of came out of the blue and was a surprisingly large amount," said Gretchen Young, senior vice president for health policy at the ERISA Industry Committee, a group that represents large employers on benefits issues.

Word started getting out in the spring, said Young, but hard cost estimates surfaced only recently with the new regulation. It set the per capita rate at $5.25 per month, which works out to $63 a year.

America's Health Insurance Plans, the major industry trade group for health insurers, says the fund is an important program that will help stabilize the market and mitigate cost increases for consumers as the changes in Obama's law take effect.

But employers already offering coverage to their workers don't see why they have to pony up for the stabilization fund, which mainly helps the individual insurance market. The redistribution puts the biggest companies on the hook for tens of millions of dollars.

"It just adds on to everything else that is expected to increase health care costs," said economist Paul Fronstin of the nonprofit Employee Benefit Research Institute.

The fee will be assessed on all "major medical" insurance plans, including those provided by employers and those purchased individually by consumers. Large employers will owe the fee directly. That's because major companies usually pay upfront for most of the health care costs of their employees. It may not be apparent to workers, but the insurance company they deal with is basically an agent administering the plan for their employer.

The fee will total $12 billion in 2014, $8 billion in 2015 and $5 billion in 2016. That means the per-head assessment would be smaller each year, around $40 in 2015 instead of $63.

It will phase out completely in 2017 -- unless Congress, with lawmakers searching everywhere for revenue to reduce federal deficits -- decides to extend it.