Should We Bail Out Hospitals' Bad Debt?

A previous blog entry tried to shed some light on the phenomenon of hospital charges that are out of control, such as $500 for a single stitch.

Well, the hospitals have their challenges, too. They increasingly have to worry about collecting money directly from patients, instead of insurers, according to recent articles.

In fact, hospitals’ struggle to get payments from patients, which are legally due, puts them in the same boat as millions of others in our society, from free-lance writers to general contractors, to anyone who sells anything on credit. They will have to develop the same skills in customer service as have providers in other sectors.

More importantly, the hospitals’ pain is necessary to bring about price transparency, which is very important in a consumer-driven health system. If hospitals are unable to tell patients what they owe before a scheduled service, they are going to continue to struggle to get paid.

Politicians must not interfere with this painful change, or price transparency will never come to health care.

Read the entire article at John Goodman's Health Policy Blog or the Independent Institute's Beacon blog.

Top Health Trend for 2014: Telehealth to Grow 50%. What Role for Regulation?

For many years, telehealth advocates have accused payers of being unwilling to reimburse for proven telehealth interventions, which can significantly reduce medical costs.

Well, we have crossed that chasm, and telehealth is about to experience explosive growth. RNCOS Business Consultancy Services has just released a report predicting 18.5 percent annual growth in telehealth worldwide through 2018. The U.S. will outpace the rest of the world. Another market research firm, IHS, predicts that the U.S. telehealth market will grow to $1.9 billion in 2018 from $240 million today, an annual growth rate of 56 percent.

This is explosive, and it has led to increased political activity.

Read the entire article at Forbes.com: The Apothecary.

Oh No! The Republicans Are Going to Tax Your Health Benefits!

If even The Wall Street Journal covers reforming the tax code to allow individuals to own their own health insurance as “Republicans Shy Away From Their Own Health Plan” (and it does), we have a big hill to climb before we can eliminate the discrimination against individually owned health insurance.

According to the WSJ, Congressional Republicans are more gun-shy than ever of a reform that would give households tax credits to buy health insurance, instead of biasing the tax code in favor of employer-based benefits.

Read the entire article at The Independent Institute's Beacon blog or John Goodman's Health Policy Blog.

"Job Lock" From Employer-Based Benefits: What Should Government Do?

Back in 1993, the economists Jonathan Gruber and Brigitte C. Madrian highlighted the problem of “job lock”, a consequence of employer-based health benefits. Gruber and Madrian figured if people with a serious health problem left their jobs, they would be subject to medical underwriting and be charged high premiums or perhaps be denied coverage altogether if they entered the individual market. So they stay in their jobs to buy the insurance their employers provide.

However, the problem was reduced by HIPAA, a 1996 federal law which required employers to offer benefits to new employees on the same term as incumbent employees, without medical underwriting, if the new employees had previous long-term coverage without a significant lapse.

Yet, one justification for ObamaCare is that it will end this (perhaps non-existent) job lock. There is a better way.

Read the entire article at John Goodman's Health Policy Blog or the Independent Institute's Beacon blog.

New Venture Funding Announced at mHealth Summit

Yesterday, the mHealth Summit at National Harbor in Maryland saw two venture funding announcements worthy of note: Practice Fusion and HealthLoop.

Read my entire article at Forbes.com the Apothecary.

Obamacare Risk Adjustment: Moving the Goalposts

The Administration has ways of partially immunizing health insurers from losing money in ObamaCare’s exchanges. The Administration is searching for ways to increase this without Congressional approval.

By the end of November, the U.S. Department of Health & Human Services (HHS) released its proposed rule for payment parameters for 2015. However, as well as proposing the parameters for reinsurance, risk adjustment, and risk corridors for the second year of the ObamaCare exchanges, the proposed rule sketched out some of the adjustments it plans to make to the previously finalized rule for 2014.

HHS asserts that it lowered the attachment point because there will be fewer extraordinary claims than originally anticipated: “…Updated information, including the actual premiums for reinsurance-eligible plans, as well as recent policy changes,  suggest that our prior estimates of the payment parameters may overestimate the total covered claims costs of individuals enrolled in reinsurance-eligible plans in 2014″ (italics mine).

This is a remarkable claim: I do not believe that any public expert who has been observing enrollment in the ObamaCare exchanges since October 1 has come to this conclusion. Quite the contrary, we believe that the exchanges are attracting older and sicker applicants than originally anticipated.

Read the entire article at the Independent Institute's Beacon blog or John Goodman's Health Policy Blog.

United States Is The Third Lowest Spender on Health Care in Eleven Developed Countries

The Commonwealth Fund’s latest survey of eleven developed countries, which questions thousands of residents about their health costs and access to health care, has once again been spun with headlines such as: “We pay more, wait longer than other countries“.

In the United States, health spending accounted for almost 18 percent of GDP in 2011. The Netherlands comes next, at just under 12 percent. In dollar figures, the U.S. spent $8,508 per capita, versus only $5,669 in Norway, the runner-up. This certainly invites us to question whether we are getting our money’s worth.

However, it’s not clear that relatively high U.S. health spending is a burden on the nation.

Read the entire article at either John Goodman's Health Policy Blog or the Independent Institute's Beacon blog.

Will Obamacare Finally Cause Seniors to Turn Against Government Health Care?

Most Americans are now aware of the disastrous rollout of ObamaCare health-insurance exchanges for privately insured people. However, this has sidelined discussion of the pain that ObamaCare is inflicting on Medicare beneficiaries.

On November 16, the Wall Street Journal reported that UnitedHealth Group has dropped thousands of doctors in at least ten states from its Medicare Advantage networks. This is a consequence of the federal government’s cutting payments to Medicare Advantage plans ― by $156 billion over ten years ― to fund ObamaCare.

Earlier this month, Evan Gahr of the Daily Caller wrote an article describing how plans nationwide are shrinking, and citing a report by consultants at Avalere which projected reduction in Medicare Advantage plans, especially in rural areas.

Read the entire article at The Independent Institute's Beacon blog or John Goodman's Health Policy Blog.