• Careers
  • Contact Us
  • Blog
  • REQUEST A DEMO

MedHOK Strategic Insights Blog

Cheers and Jeers in Health Care

Marc Ryan | September 6, 2017

Laptop computer with thumbs up and down as like or dislike - isolated.jpegThumbs up-01.pngCheers to a number of health insurance commissioners and health plans who were able to get health plans to cover all U.S. counties in the exchanges in 2018.  Just a few weeks ago, it looked like as many as 50 counties would be bare in various states including Nevada, Ohio, Missouri, Wisconsin, and Washington, among others. The insurance commissioners cashed in favors with health plans and cajoled them to cover those in need in the excluded counties. Now it’s a victory, but the Exchanges in many states are tenuous, with huge premium increases and minimal participation. Despite the victory, nearly half of all U.S. counties have only one plan to offer and the Exchanges are by no means financially solid there.

Thumbs down-01 (1).pngJeers to the Trump Administration for continuing to fail to formally commit to funding the cost-sharing subsidies through at least 2018. Administration members must understand that this has inevitably led to plan exits, soaring premiums, and counties that would have been entirely without plans if not for the Herculean efforts of insurance commissioners. Don’t they?

Thumbs up-01.pngCheers to Gov. John Kasich, R-OH, Gov. John Hickenlooper, D-CO, and a bipartisan Governors group for coming up with a plan to stabilize the Exchanges. While by no means perfect and perhaps too lean to make a significant difference, it offers hope that wiser heads, rather than politics, will prevail on healthcare reform. Kasich and Hickenlooper would:

  • Retain the individual mandate. While we are mixed on its effectiveness, we admit that it does help ensure everyone plays in the system and is an important part of the approach in many European countries.
  • Commit to funding the cost-sharing subsidies through 2019.
  • Continue efforts to enroll people in the Exchanges.
  • Create a temporary stabilization fund of $15 billion for at least two years to help states reduce premiums and insulate insurers from losses.
  • Help create health plan participation in underserved areas by exempting these insurers from the federal health insurance tax passed as part of the Affordable Care Act (ACA).
  • Allow states some leeway in basic coverage mandates and broaden state waiver authority under the ACA.

Thumbs down-01 (1).pngJeers again to the Trump Administration for cutting the open enrollment length for 2018 down from 90 days to 45 days. While some of its stabilization regulation made sense, this move likely will mean fewer healthy individuals signing up for the Exchanges in 2018. Sick folks will jump at the first chance to enroll and healthier ones will procrastinate, not thinking that the period is about to expire. With 45 days instead of 90 days, adverse selection will only increase next year in many states. However, some states with state-run Exchanges plan to ignore the federal rule and extend their own enrollment periods, which should help in those locations.

Thumbs up-01.pngCheers to a few key Republican Senators for beginning to reach across the aisle on healthcare reform. Sens. Lamar Alexander, R-TN, and Patty Murray, D-WA, Chairman and Ranking Member of the Health, Education, Labor and Pension (HELP) Committee, have begun to hold hearings to look at ways to bridge the divide on healthcare reform. The bipartisan Governors’ plan above will be one of the proposals considered. Senator Orrin Hatch, R-UT, and Chairman of the Finance Committee (the other committee with responsibility over health matters) will hold similar hearings. Senator Alexander has said that he hopes to pass legislation by the end of September.

Thumbs down-01 (1).pngJeers again to the Trump Administration for slashing advertising and outreach dollars in the Exchanges. While we understand that economies were needed, the 2018 plan has just $10 million for marketing nationally, down from $100 million in 2017.  Funding for community outreach organizations to help enroll individuals with limited health literacy, and other barriers to health care, drops from about $63 million to $37 million.

Thumbs up-01.pngCheers to Accountable Care Organizations (ACOs) for showing that pilots in the antiquated Medicare fee-for-service system can save money and improve quality.  According to a just-released report from the Health and Human Services Office of Inspector General (HHS OIG), most of the 428 ACOs in the Medicare shared-savings program (one of the ACO programs) reduced spending and improved quality.

The OIG found that about one-third of ACOs reduced spending enough to receive a shared-savings incentive payment during the first three years of the program. These ACOs reduced spending by about $2.8 billion from 2013 to 2015. Of that amount, the ACOs received $1.3 billion in shared-savings payments. About two-thirds of the ACOs reduced spending for at least one of the three years and 146 ACOs did not reduce spending in any year.

More promising statistics:  In the last year studied (2015), 57% of the ACOs in the program for three years saved money and 46 percent that were in for one year saved money.

The ACOs also did well on quality outcomes with 82 percent showing improvement on 33 individual quality measures. The OIG says that the ACOs outperformed fee-for-service providers in 81 percent of the quality measures. The ACOs served almost 10 million Medicare beneficiaries total.

The news is good.  It shows that many of the ACOs, consortia of hospitals, physicians, and ancillary providers, are adapting to the new quality-based payment regime.

Thumbs down-01 (1).pngAnd last, as we reported previously, Jeers again to the Trump Administration for cancelling portions of the bundled payment reform initiatives.  Based on the ACO achievement above, these programs should continue. See our August 18 blog for our thoughts on payment reform.

Looking at the Jeers, we see a trend here.

Affordable Care Act, Healthcare Reform, ACOs, ACA, Trump Administration, cost sharing subsidies, Congress, healthcare access, OIG, healthcare exchanges, ACA marketing budgets

About The Author

Marc Ryan

Marc S. Ryan serves as MedHOK’s Chief Strategy and Compliance Officer. During his career, Marc has served a number of health plans in executive-level regulatory, compliance, business development, and operations roles. He has launched and operated plans with Medicare, Medicaid, commercial and Exchange lines of business. Marc was the Secretary of Policy and Management and State Budget Director of Connecticut, where he oversaw all aspects of state budgeting and management. In this role, Marc created the state’s Medicaid and SCHIP managed care programs, and oversaw its state employee and retiree health plans. He also created the state’s long-term care continuum program. Marc was nominated by then HHS Secretary Tommy Thompson to serve on a panel of state program experts to advise CMS on aspects of Medicare Part D implementation. He also was nominated by Florida’s Medicaid Secretary to serve on the state’s Medicaid Reform advisory panel. Marc graduated cum laude from the Edmund A. Walsh School of Foreign Service at Georgetown University with a Bachelor of Science in Foreign Service. He received a Master of Public Administration, specializing in local government management and managed healthcare, from the University of New Haven. He was inducted into Sigma Beta Delta, a national honor society for business, management and administration.

0 Comments

Subscribe to MedHOK's Blog

Subscribe to Email Updates

Recent Posts