Letter – Bring other medical, dental plans up to Passport’s level

I am the managing doctor for Kentuckiana Oral and Maxillofacial Surgery, a five-physician practice based in Jefferson and Bullitt Counties. I read with great interest the editorial about Passport that appeared in the June 5 edition of The Courier-Journal.

Our practice has been in network with Kentucky Medicaid since July 1, 2004, when we first opened our doors. Due to our specialty, we perform both medical and dental procedures, so we file to both medical and dental plans. Because we are located in Region 3, we fall under the Passport umbrella. Passport is the Kentucky HMO plan that covers 16 counties. But because we are referred patients from all over Kentucky, we see patients who are covered by the new Medicaid plans as well, so we also contracted with each new medical plan and each new dental plan. That puts us in a fairly unique position to have first-hand knowledge of how each plan works.

Passport puts the patients first. There’s no doubt in my mind about that. Their requirements for a patient’s care are well-outlined. They make it very clear to the medical and dental providers just what they will and won’t cover. Passport has streamlined the authorization process for large procedures, and they have eliminated authorization requirements for procedures that are performed on a daily basis or emergent in nature. Passport lets us spend our time doing what we do best — performing necessary medical and dental services. The medical staff and the business staff in our offices don’t waste time arguing with Passport trying to get permission to do necessary work or trying to get paid for the work that has already been done.

This cannot be said for the new plans. We have trouble getting even the most routine procedures authorized. Needed treatment is often denied or delayed. And I’m not talking about a delay of a few days — or a delay of a few weeks; I’m talking about a delay of a few months or more. And once the work is performed, the doctors cannot be sure if/when/how they’ll be paid.

Surely this is not what our governor and Medicaid commissioner had in mind when they contracted with these new plans. And, as medical and dental providers are opting out of working with these new plans, the number of our patients who are covered by these new plans is increasing. It is no longer unusual to have a patient drive from Pikeville or Bowling Green because they can no longer find an oral surgeon near their home.

So I have a few questions for those in Frankfort who are making these decisions:

• Why would you allow the new plans into Region 3 when you’ve seen the chaos they have created elsewhere in the state?

• Don’t you think it’s time to review the manner in which the new plans are paid? It is my understanding that they receive a certain amount of money at the beginning of each month. After they pay out a certain amount, the rest is theirs to keep. So when these new plans deny and delay care, they make more money. That has to be a conflict of interest. Perhaps we need more non-profit organizations like Passport handling these claims for service.

• Aren’t there companies in Kentucky who could handle the Medicaid claims? Wouldn’t it make sense to keep taxpayer money in Kentucky? Wouldn’t it make sense to work with companies that are based right here so oversight is easier?

My partners and I want to continue providing care to the Medicaid population, but if Gov. Steve Beshear and Acting Commissioner Wise choose to “open the floodgates” in Region 3, we may not be able to do so.

Let’s see if our government officials can’t figure out a way to bring the other 104 counties in Kentucky up to the same level of medical and dental care that the 16 Passport counties currently experience.

CHRISTOPHER C. BABCOCK,D.M.D, M.D.

Kentuckiana Oral and Maxillofacial Surgery

Louisville 40202

Health Insurers Prepare Post-Supreme Court Messaging

Health Insurers Prep Messages for Supreme Court Decision on Obamacare

Companies Ready Their Responses Based on Three Potential Outcomes; Some Already Have Made News

By: Alexandra Bruell Published: June 18, 2012

 

For health-insurance companies, there’s no calm before the storm.

The Supreme Court decision on the fate of President Barack Obama’s Affordable Care Act, scheduled to be announced at the end of this month, has insurers scrambling to prepare messaging for three potential outcomes: the law is upheld; the law is overturned; or parts of the law, such as the individual mandate that everyone must purchase insurance, are overturned.

Since 2010, when the health-reform bill became law, insurance companies have been boosting their consumer-facing marketing efforts to prepare for an environment in which everyone has access to health care regardless of pre-existing conditions and is forced to purchase insurance. According to Atlantic Information Services, Aetna, Cigna, UnitedHealthcare, Wellpoint and Humana alone spent a collective $366.8 million on advertising in 2011, up 51.6%  from 2010. The report references data from AIS’s Health Plan Week and Kantar Media.      

No matter what happens, insurers will continue to invest in consumer-oriented products and preventive-wellness programs focused on keeping medical costs low. But the ruling will still have a profound effect on business models and marketing messages supporting those hundreds of millions in advertising dollars.

If the law is overturned, insurers will revert to many of the old rules, such as choosing their own customer base. But they’ll likely continue to communicate the kinds of messages we saw last week from Aetna, Humana and United. The for-profit insurance companies got out in front of the Supreme Court ruling: Regardless of the decision, they said, they would continue to implement more consumer-friendly elements from the reform law, such as allowing kids under the age of 26 to stay on parents’ plans and keeping prevention and wellness a priority.

If the law is overturned, big insurers that focus on niche markets will also tailor messaging to fit consumers affected by the ruling. For example, a company that targets the Medicare community might educate consumers about how drug coverage is affected, said Lindsay Resnick, chief marketing officer of KBM Group, a WPP direct-marketing health group. The reform closes the gap in Medicare drug coverage known as the doughnut hole. If the law is overturned, he said, the hole remains. So an insurer might say something like: “We’ll help our Medicare Part D customers through that, and we’ll push for legislation that extends Accountable Care Organizations. We believe in having providers partake in some portion of the risk.”

If the entire law is upheld, the three insurers who pledged to keep elements of the reform law — Aetna, Humana and United — will likely issue reminders that they would have had consumers’ backs had the law been overturned. Although they caught some flak for not pledging to carry out the most dramatic elements of reform, such as selling to consumers with pre-existing conditions, industry execs agreed that their proactive messaging was a smooth PR play.

The third scenario could throw out one or two major pieces of the reform law, such as the mandate that all individuals must purchase insurance, but uphold other elements of the law, such as mandates for state-run exchanges where consumers can purchase insurance directly from a web platform.

In this partial-reform scenario, companies are likely to create messages around how to help people with pre-existing conditions get some form of insurance. They might tout an expanded plan portfolio and increase promotion of existing “catastrophic plans,” which have low premiums and can only be used for, well, catastrophic events.

“They’ll use it as an opportunity to say that “Even though it’s not mandated, we’ll make our products more accessible to you,'” said Mr. Resnick.

This scenario has driven some companies to nearly double their research and PR budgets during the past six months, according to executives speaking on the condition of anonymity.

If only the mandate is thrown out, there will be “a very intensive targeted effort aimed at policy, stakeholders and opinion leaders,” said Mike Tuffin, who recently left his post at the Association of Health Insurance Plans and is set to join APCO this week.

But companies will need to balance policy pushes with consumer messages, he said. The policy message will point out the negative effects of eliminating the mandate, such as higher premiums, while the consumer message might “ensure that in this disruptive environment, their current customers can still count on coverage,” Mr. Tuffin said.

Insurance companies are complying with AHIP’s agenda to create a unified message, said numerous executives. They’re also in line on another front: being judicious about what they say.

A PR executive who worked at an insurance company said, “There have been a number of cases, especially since the Medicare Modernization Act, where insurance companies have run afoul of one piece of government or another based on messaging, and it’s made them very cautious.”

Minnesota Medicaid on Trial

On trial: Minnesota Medicaid

• Article by: KEVIN DIAZ
• Star Tribune
• June 16, 2012 – 9:56 PM

WASHINGTON – It began with a $30 million “voluntary contribution” to Minnesota taxpayers from one of the state’s nonprofit Medicaid contractors, an unprecedented act of corporate generosity that raised eyebrows from St. Paul to Washington.

Skepticism about the payment focused first on DFL Gov. Mark Dayton, whose administration sought to keep the money in state coffers rather than share it with the federal government, which foots half the bill for Medicaid.

Then congressional investigators pounced, setting off on a trail of suspected overpayments to state Medicaid contractors that could potentially reach hundreds of millions of dollars and going back a decade to the administration of Republican Gov. Tim Pawlenty.

That search culminated on Tuesday, when House and Senate investigators in Washington spent three hours privately questioning Nancy Feldman, chief executive officer of UCare Minnesota, a managed-care contractor that made the $30 million payment last year. The investigators say that Feldman, who was accompanied by two lawyers, is not suspected of any criminal wrongdoing. Through a spokesman, Feldman said she was “happy to assist the staff, and was pleased by the tenor and outcome of the discussion.”

But the meeting on Capitol Hill deepened the federal probe into allegations that the state has been overbilling federal taxpayers for Medicaid payments to UCare and other state HMOs to offset their losses on other state-funded health programs. Whatever the outcome, a state that once prided itself on its expansive coverage for the disadvantaged is being branded in Congress as “Case Study No. 1” in what federal investigators say is a nationwide pattern of states claiming excessive federal dollars to plug their own budget gaps.

“Minnesota provides a stunning example of how states are failing to properly ensure the appropriate use of taxpayer dollars spent on Medicaid managed care,” wrote investigators for the U.S. House Oversight and Government Reform Committee, which has already taken testimony from Minnesota Department of Human Services (DHS) Commissioner Lucinda Jesson.

Smoking gun

If there’s a smoking gun, it was provided by Feldman in a March 2011 letter explaining the $30 million payment. She wrote that rates paid by the Minnesota Department of Human Services to HMOs for the state’s General Assistance Medical Care (GAMC) program “resulted in health plan losses which were offset by higher [Medicaid] payments.”

Moreover, Feldman noted, the higher Medicaid rates were not adjusted after the Pawlenty administration ended the state-funded GAMC program in 2010.

That has raised three questions for investigators in Washington: Were federal Medicaid dollars being used to underwrite Minnesota’s program? Why didn’t federal regulators catch it? And was the $30 million UCare payment, which the state called a “donation,” an attempt to return excess payments and lower the heat level?

“It looks like CMS was asleep at the switch,” said a congressional staffer close to the investigation. “I think it’s pretty obvious cross-subsidization was going on.”

Whether any of that amounted to fraud is now the focus of at least three federal probes, two by congressional Republicans and one by the Justice Department.

Officials in the Dayton and Pawlenty administrations say they have done nothing wrong. Industry executives likewise deny that the health plans are overpaid, noting that state business was unprofitable for them in 2006 and 2007, and less profitable than their private-sector business in other years.

The state is expected to address investigators’ question in a filing due on Monday.

At the same time, Republican lawmakers in Washington are raising broader questions about wasted money and lack of federal oversight in the nation’s $457 billion Medicaid program — a system that already covers nearly one in five Americans and is slated to expand dramatically under the federal health care overhaul signed by President Obama.

“Somebody’s getting the money, but it’s not going to the poor people this program was intended to help,” said Minnesota Republican Rep. Michele Bachmann, an outspoken critic of the Obama law.

In Minnesota, the criticism has been equally sharp on the other end of the political spectrum. “The trouble is, nobody’s minding the store,” said state Sen. John Marty, DFL-Roseville, a critic of the state’s experiment with outsourcing public health coverage to private managed-care companies. “It’s not the image people have of Minnesota.”

‘First indication’

State legislators in both parties have been asking questions for years about the rates paid to managed-care companies, a nexus of nonprofits that were paid a combined $3.3 billion in 2010 to care for some 524,000 Minnesotans on public medical assistance. State and congressional reports detail HMO operating margins that are often greater from their state business than from their commercial plans.

Much of the legislative interest has been stirred by St. Paul attorney David Feinwachs, who says he was fired by the Minnesota Hospital Association after accusing the health plans of over-charging the state. “What unites both left and right is, whether you’re a deficit reduction guy, or an access-to-health care guy, it’s clear that this thing is a giant rip-off,” he said.

Marty, Bachmann, and state Sen. Sean Nienow, R-Cambridge, have been calling for independent, third-party audits. Nienow notes that the questions go back at least to 2003, when the feds raised questions with the Pawlenty administration about HMO rates. “That was the first indication that something less than proper was going on,” Nienow said.

But the HMOs also have their defenders among Democrats and Republicans. State Sen. David Hann, an Eden Prairie Republican who chairs a health committee, says there is no shortage of audits and reports in the heavily regulated industry.

Hann’s beef is with the federal Medicaid system itself, which he calls “fundamentally flawed,” in part because it encourages states to leverage every last dollar they can get from Washington — exactly what Pawlenty and Dayton are accused of doing.

Hann supports a plan by congressional Republicans to turn Medicaid into a federal block grant program, which he says would eliminate the states’ incentives to game the system.

Competitive bidding

Some Democrats, including former Minnesota Attorney General Mike Hatch, suspect that whatever the merit of the GOP probes, their underlying agenda could be to weaken political support for the Medicaid program.

For their part, Dayton officials boast that they have moved to a new system of competitive bidding for Medicaid business and expect to reap some $600 million in savings over the next two years. In the meantime, they forged agreements with the state’s four Medicaid contractors — UCare, Medica, HealthPartners and Blue Cross and Blue Shield — to cap 2011 profits at 1 percent, a step that returned $73 million to taxpayers this year.

“We wanted to make sure there weren’t excessive profits being made,” said Assistant Human Services Commissioner Scott Leitz.

But UCare’s $30 million payment, touted as a windfall, clouded what might otherwise have been seen as one of the signal reforms of the Dayton administration. Noting that UCare was the only one of the four Medicaid HMOs to cough up the money, Hatch said: “No good deed goes unpunished.”

Kevin Diaz is a correspondent in the Star Tribune Washington Bureau.

© 2011 Star Tribune