Health Reform to Stay the Bumpy Course


Posted by: Joel Wittman

As this is my first post since the presidential election, I thought that this would be a good time to look at how the ACA may play out.  Fierce Healthcare published an article about this soon after the election.  I thought it would be of interest to you.

Reelected for a second term, President Barack Obama is expected to carry out the landmark Affordable Care Act of 2010–but not without some resistance from a split Congress.

Many health reform provisions that hung in the balance during election season could see implementation in 2013 and 2014. The Democratic presidential win particularly confirms the forth-coming health insurance exchanges, the phasing out of annual insurance limits and protections for those with pre-existing conditions. However, it also leaves certain controversial provisions–namely, Medicaid expansion and the Independent Payment Advisory Board–in the hands of a divided Congress that may slow reform.

According to the Healthcare.gov timeline, the healthcare industry can expect:

Higher Medicaid payments for primary care physicians – Jan. 1, 2013
Under the Affordable Care Act, primary care physicians can expect Medicaid payments that resemble reimbursements for Medicare. Family doctors, internists and pediatricians next year will see Medicaid payments increase by up to 7 percent, estimated at $11 billion, although specialists have complained they are largely left out of the increased payments.

Medicaid expansion – Jan. 1, 2014
Perhaps one the most contentious issues that could see continued partisan politics is Medicaid expansion. Individuals who earn less than 133 percent of the poverty level (approximately $14,000 for an individual and $29,000 for a family of four) will be eligible to enroll in Medicaid. Although the Obama administration envisioned Medicaid expansion would be implemented across the country, the U.S. Supreme Court decision in June left it up to the states. Red, Southern states, in particular, have been particularly resistant to Medicaid expansion.

“The surprise Medicaid ruling by the Supreme Court will put hospitals in direct conflict with Republican governors who may want to not participate in the Medicaid expansion for political reasons,” Kent Bottles , senior fellow at the Thomas Jefferson University School of Population Health in Philadelphia and FierceHealthcare editorial advisory board member, told FierceHealthcare in an interview. “States not participating will be terrible for hospitals that are depending on the increased coverage to offset the decreased revenue from the federal government contained in the PPACA,” Bottles said.

With an expected 16 million uninsured Americans to enter the Medicaid system, provider reactions have been mixed, with some saying greater coverage for all will be a welcome relief, while others worry the patient volume will tax already overburdened staffs and resources.

“The ACA will increase the number of Medicaid beneficiaries, but it does not guarantee access to primary care,” Jesse Pines, director of the Center for Health Care Quality and associate professor of emergency medicine and health policy at George Washington University in Washington, D.C., told FierceHealthcare. Pines, a FierceHealthcare editorial advisory board member, noted many primary care physicians are turning away Medicaid patients, opting for higher-yielding patients who have commercial insurance or are on Medicare. “So it may be difficult for people to get in to see primary care doctors. With no other option (but with insurance), many will come to the ED,” he said.

Jeremy Tucker, medical director of the emergency department at MedStar St. Mary’s Hospital in Leonardtown, Md., and FierceHealthcare advisory board member, added his area already has physician shortages that may push newly insured patients to turn to emergency departments and urgent care centers to get their care.

“We are already seeing tertiary care hospitals that we transfer patients to asking us insurance status questions, and while they do not refuse to accept the patient, they will absolutely limit what they do for the patient [by simply stabilizing and discharging].”

He also said the physician shortage, coupled with increased patient volume, will lend to a higher reliance on non-physician providers, such as nurse practitioners and physician assistants.

Divided Congress could slow reform
With the Democratic hold on the Senate and Republicans maintaining the House, Congress will look much like the past four years–a political landscape that worries some in the industry.

“We should see more of the same–stalemates and gridlock in Washington,” Tucker told FierceHealthcare when asked the possibility of a Republican repeal.

A bitterly divided Congress could mean delays in appropriating money to fund the health law’s provisions.

The American Medical Association, while congratulating the President, also took the opportunity to point to the lingering question about the ever-present fiscal cliff–what will happen with the doc fix?

“The AMA is … committed to working with Congress and the administration to stop the nearly 27 percent cut scheduled to hit physicians who care for Medicare patients on Jan. 1, [2013],” AMA President Jeremy Lazarus said in a Wednesday statement. “It is time to transition to a plan that will move Medicare away from this broken physician payment system and toward a Medicare program that rewards physicians for providing well-coordinated, efficient, high-quality patient care while reducing healthcare costs.”

What are your thoughts about the ultimate success of the health care reform act?  Can a split Congress put aside their partisanship for the betterment of those in need of health care services who otherwise could not afford coverage?  While not perfect, the ACA is at least a start in the right direction.  Your comments are always welcome – let me hear from you.

Joel Wittman is an Adjunct Associate Professor at the Wagner School of Public Service of New York University.  He is the proprietor of both Health Care Mergers and Acquisitions and The Wittman Group, two organizations that provide management advisory services to companies in the post-acute health care industry. He can be reached at joel.wittman@verizon.net.


The Hidden Healthcare Election


Posted by Errol Pierre

It’s Healthcare, Stupid!
James Carville famously coined the phrase “The Economy, Stupid!” while he was a campaign strategist for the 1992 Clinton Presidential campaign. Fast-forward to 2012 and for good reason both campaigns seemed to take heed to Carville’s advice. For good reason, the unemployment rate hovers around 8%.  On top of that 40% of the unemployed have been jobless for more than 6 months. The labor force participation is barely 64%. Lastly, more than 8 million people last month were employed only part-time specifically due to economic reasons.

However, there seemed to be an undercurrent of Healthcare specific issues in this election that never really surfaced or was given its due attention.  Many of these issues revealed themselves in the exit polling of the most contentious battle ground states.

Obamacare & Florida
16% of the U.S. population lacks health coverage. Obamacare would provide substantial subsidies to individuals that otherwise could not afford insurance. Even though Mitt Romney has proven experience with health care by being the first Governor to ever pass universal healthcare legislation in a state, he ran to repeal President Obama’s healthcare bill even though it closely mimicked the Massachusetts bill Romney himself signed into law just 3 years prior.

Florida has the highest uninsured rate and uninsured population of any battleground state standing at 20% and 4 million people respectively. Over 90% of the uninsured population falls below the 500% federal poverty level ($55,000 for an individual). In Florida roughly 50% of the electorate earns below $55,000 a year. Exit polling showed Obama carried 60% of that population with Romney winning only 40%.

Auto Bailout & Ohio
November 18, 2012 will mark the 4 year anniversary of Mitt Romney’s infamous New York Times Op-Ed entitled Let Detroit Go Bankrupt. Romney called for a managed bankruptcy for General Motors, Ford, and Chrysler standing in strong opposition to a pure bailout. He also called for the heads of the companies to step down and acknowledged that autoworker benefits, including health care, would need to be reduced in order to alleviate the $2,000 burden of additional costs Detroit cars had that made their cars foreign counterparts did not.  During the last leg of the Presidential election, Mitt Romney became unpopular in parts of Ohio for this stance. In fact, President Obama ran on the auto bailout with his Vice President claiming, “Osama Bin Laden is dead and General Motors is Alive!”

The Obama administration ended up moving forward with a plan that very much resembled the Romney Op-Ed. The Obama plan called for the heads of the car companies to step down, sought to have GM and Chrysler pursue Chapter 11 bankruptcy filings, and acknowledged that auto unions would face “belt-tightening in wages, healthcare, and retirement benefits”.  In the end, based on Ohio exit polling, 56% of Ohio voters approved of Obama’s auto bailout and Romney was never able to properly articulate how close his auto plan was to the President’s.

Minority Unemployment Rates & Ohio/Nevada/Colorado/Virginia
The majority of the country receives their health insurance from an employer-sponsored program. That means a job is more than just a paycheck, it’s a means to get health coverage as well. The unemployment rate for African Americans is 14%; six percentage points higher than the national average. Obama won 89% of the African American vote in Nevada, 93% of the African American vote in Virginia, and 96% of the African American vote in Ohio. The unemployment rate for Hispanics is 10%; two percentage points higher than the national average. In the battleground state of Colorado, Obama won 74% of the Hispanic vote. In Nevada  Obama won 69% of the Hispanic vote. In the end, Minorities were convinced that President Obama could grow jobs that offer comprehensive benefits like healthcare better than Mitt Romney.

Abortion & Ohio
Abortion is indeed more than a religious issue. It’s a healthcare issue as well.  Mitt Romney went on record vowing to defund Planned Parenthood during a campaign stop in Ohio. This was after Republican candidate, Todd Akin, interjected the phrase “Legitimate Rape” into the American lexicon justifying it as information he garnered from physicians. Overlay these two instances with Ohio exit polling and we witness that 56% of voters believe Abortion should either always or mostly be legal.  As a result, Obama won 80% and 63% of those votes leaving Romney on the losing end of an important Ohio issue.

Errol Pierre is the Assistant Vice President of Product Management at a regional health insurance company focused on business development, sales, and strategy planning around Health Exchanges. He is currently pursuing a degree in Health Policy and Management with a specializing in health finance. He can be reached at errol.pierre@nyu.edu