Report: Calif. hospital chain profited from ER admissions
Filed under: Health data, Health journalism, Hot Health Headline, Public records
After months of investigation and updates, California Watch reporters Christina Jewett and Stephen K. Doig have unleashed their full report on California hospital chain Prime Healthcare Services and its knack for turning around failing hospitals by apparently pushing for the admission of ER patients who are insured by Medicare or insurance giant Kaiser Permanente, then keeping them in the hospital.
The report includes hyperlink sourcing, a raft of related documents and a great explainer on how they assembled the numbers behind the story. The duo took advantage of court testimony, sources and reams of public records.
The reporters say that evidence points to “an orchestrated campaign of admitting Medicare and Kaiser patients – moving them from the emergency room to a hospital bed – in the interest of changing the fortune of a money-losing hospital.”
State data shows that after the hospital chain took over 11 hospitals beginning in 2005, the percentage of Medicare patients who were admitted from the emergency room to Prime hospital beds increased from about 45 to 63 percent.
That 40 percent increase contrasts with other California hospitals that saw an average 8 percent decline from 2005 to 2009 in Medicare patients moved from the emergency rooms to hospital beds, data shows.
And, as you’ll see throughout the story, the interviews and anecdotes back up the numbers.
Tina Buchanan, the hospital’s former chief nursing officer, testified that [Prime founder and chairman Dr. Prem Reddy] began to require emergency room staff to put a yellow sheet of paper on each patient record that listed their health insurance status.
She said he would go through the “goldenrods,” as the papers were called, and point out the Medicare or Kaiser patients and say, “Make sure you get this one admitted.”
“If it was … an uninsured patient, he would tell them, ‘Get them out of my hospital,’ ” Buchanan testified.
There’s plenty more where that came from, but I will just leave you with this editor’s note, which appears alongside the main story.
It came to our attention late Friday that Prime Healthcare had issued a press release saying it had taken legal action against California Watch. We have not been served and can’t fully comment until we have reviewed any legal filings. In our dealings with Prime over the course of the past several months, the company has yet to present to us a single factual error that has merited correction or clarification. We continue to stand by our reporting.
Reform opponents got millions from industry
Filed under: Conflicts of interest, Health care reform, Health policy, Hot Health Headline, Public records
Caitlin Ginley, of the Center for Public Integrity, used data from the National Institute on Money in State Politics to demonstrate that the state officials who have joined forces to file a lawsuit challenging American health care reform have, together, received more than $5 million in campaign contributions from hospitals, pharmaceutical companies, doctors and insurers. Among the governors and attorneys general in the 20 states supporting the suit, a few stood out.
… the Center found that top recipients of industry money include Texas Attorney General Greg Abbott, who has received more than $1 million from health care professionals since 1996, and former Georgia Governor Sonny Perdue, who took in at least $970,163 from the industry starting in 1992, when he was a state senator, until he left the governor’s office this week. Other major recipients involved in the lawsuit include former Pennsylvania Attorney General and newly-elected Governor Tom Corbett, who has received about $830,000, and Mississippi Governor Haley Barbour, with more than $770,000.
Ginley provides details on the donations each of those officials received, as well as several others. No word on how this compares to other samples of 40 high profile state politicians. Physician groups and private doctors played a major role in many of the cases she examined.
Reporter uncovers $86 million from insurers to fight reform
Filed under: Health care reform, Health journalism
The flow of money into politics in general, and health reform in particular, has been thoroughly opaque this election season, yet Bloomberg’s Drew Armstrong has still managed to pull back the curtain and figure out that insurers gave $86 million to the U.S. Chamber of Commerce, which then lobbied heavily to either hamstring reform or to reshape it in the insurers’ favor. Armstrong traced the money to America’s Health Insurance Plans through classic reporting tools: public records and well-placed sources.
Tax forms require organizations to list only the amounts granted or received from other groups, not the organizations’ identities. Health insurers expressed opposition to parts of the health-care legislation while they conferred with congressional Democrats writing the bill and the White House. At the same time, the Chamber of Commerce was advertising its opposition.
The Chamber spent $45.5 million on a campaign against the bill in 2009, according to TNS Media Intelligence/Campaign Media Analysis Group, an Arlington, Virginia-based company that tracks political advertising.
The Chamber began in March 2010, weeks before the bill became law, another $10 million effort focused on pressuring lawmakers to vote against the bill. Blair Latoff, a spokeswoman for the Chamber, wouldn’t say how much of the money was spent in 2009 and how much, if any, was used in 2010.
Why California hospitals can charge so much
Filed under: Health data, Health journalism, Public records
California hospitals, especially those in the Bay Area, seem to be able to set prices with impunity, a fact we know in part because the state requires an unusual level of hospital finance disclosure. This week, Kaiser Health News reporter Jordan Rau took advantage of the available records and dug through hospital spending databases and a long list of sources to figure out just what gave certain hospitals the leverage to charge so much more than competitors offering equivalent services. For a quick review of the data unleashed by this law, I recommend reviewing the map and charts that ran alongside the story.
As you might expect, the underlying explanation is complicated. When Rau asked the hospitals why prices were rising, he got a familiar refrain. They blamed it on the need to make up for low Medicare and Medicaid reimbursements, as well as charity care, and reminded him that technology is expensive and that their particular patient populations were unusual in ways that naturally obliged them to charge extra.
Those are certainly all part of the equation, but Rau investigation seems to point in another direction: Garden variety economic clout.
State laws have inadvertently given hospitals even more leverage. California requires health maintenance organizations to have “adequate networks” that offer all major specialties reasonably close to where patients live. Lisa Rubino, president of Molina Healthcare of California, an insurer, says the law makes it difficult for insurers to drop big hospitals from their networks.
“You have to work with them or make a strategic decision to get out of the area because they can dig in,” says Rubino.
Rau elaborates on this idea in a companion piece on NPR’s health blog, in which he points out how the industry has deftly squashed two different efforts to increase transparency in their pricing practices.
Report cards and rankings for 227 HMOs
Filed under: Health care reform, Health data, Tools
The National Committee for Quality Assurance, a nonprofit health plan accreditation organization, has unleashed its annual ranking of private health insurance plans, which have also been published in Consumer Reports. As present, the list only contains health management organizations.
Only the top four providers received the full five points in consumer satisfaction, treatment and prevention. New England providers took top honors this year, with Harvard Pilgrim taking first (Massachusetts and Maine) and third (New Hampshire), and Tufts Associated coming in second. Florida’s Capital Health plan came in fourth.
In addition to the list, NCQA released a detailed report card for each HMO (241-page PDF). There, plans are rated for specific satisfaction measures, diseases and patient groups.
Look for similar rankings of Medicare and Medicaid plans to come out in the next month or so.
CPI: Insurers prepare $20 mil lobbying effort
On the Center for Public Integrity’s PaperTrail blog, Peter Stone reports that five of biggest insurers in America are preparing to go to the mat for round two, this time with the intertwined goals of swinging midterm elections and influencing health reform implementation regulations.
According to Stone, Aetna, Humana, United HealthCare, WellPoint and (maybe) Cigna will pool something like $20 million. Look for the new lobbying organization, probably a 501(c) (4) nonprofit, in the next few months. Television ads and a variety of other campaigns will likely follow.
New rules affect patients’ insurance appeals
Filed under: Health care reform, Health policy, Hot Health Headline
Kaiser Health News’ Phil Galewitz and Michelle Andrews have an update on health care reform implementation, pointing out that new rules will give consumers the right to appeal insurance denials, first directly to the insurer and then to review boards. The rule doesn’t break new ground in most states – only five lack such regulations, and existing plans are “grandfathered in” under the old rules – but it may bring order to a chaotic national patchwork on insurance appeals. The White House estimates that, by next year, the rules will benefit about 41 million Americans insured either through employers or through individual plans. The administration is pushing states to implement the new standards by next July.
The new regulations take effect for plan years starting Sept. 23. But they won’t automatically apply to residents in states that have existing external review laws until next July. That’s to give states time to adjust to the new standards.
If states fail to change their rules by next July, their residents will then be able to rely on the federal standards. But federal officials are still working out the details of how that would be done.
Read the HHS press release here.
AHCJ resources
- Reporting on health reform between now and 2014: Some top Washington, D.C.-based journalists discussed implementation deadlines, how to tie local issues to reform, Medicare reimbursement rates, what reporters should look for in their states and more. A recording and transcript of this briefing and a resource list are available.
- Covering high-risk insurance pools: The federal government and states are scrambling to create temporary high-risk pools for the medically uninsurable, as one of the first provisions of the Patient Protection and Affordable Care Act to go into effect. Apart from being a policy story, it’s of great interest to all your readers, viewers or listeners who have pre-existing conditions and are struggling to find coverage. Four reporters covering the topic have shared their story tips, suggestions and resources for AHCJ members.
- Health care reform has passed: What’s next? Four journalists on the front lines offer their advice and suggestions on what needs to be covered next, how it might affect local communities and how to approach this complex topic.
Why insurers care about the medical-loss ratio
The Wall Street Journal’s Avery Johnson explains the significance of the “medical-loss ratio,” a single metric within the reform bill that holds great significance for the insurance industry.
The ratio, known to wonks as the MLR, signifies the percentage of premiums insurers use for medical costs versus the amount that goes to paying administrative overhead. For individual and small-business plans, it’s set at 85 percent medical to 15 percent administrative. For larger businesses, the magic medical number is 80. Those who don’t meet the threshold would be forced to pay rebates to customers.
At present, the key issue seems to be subsidiaries. Major insurers have hundreds of them each, and while the insurer could meet the requirements if all subsidiaries were averaged together, they won’t be able to hit the numbers at every single subsidiary. Current draft documents, Johnson reports, seem to imply that each subsidiary would be judged separately, a practice which insurers say might force them to stop providing insurance in certain high-risk areas.
Applying uniform numbers to the segmented, fragmented insurance industry could prove tricky. Johnson looked at the numbers.
UnitedHealth, for instance, has about 392 subsidiaries, according to Goldman Sachs health-care analyst Matthew Borsch. Its average MLR for individual policies is 69%, dragged down by a 63% ratio at its dominant Golden Rule subsidiary, according to a report by Goldman Sachs that examined state insurance filings. The Minnetonka, Minn., insurer could owe about $280 million in rebates in 2012, Mr. Borsch estimates, based on his reading of the methodology in the health care law.
The rules will be set by the National Association of Insurance Commissioners, a coalition of state insurance regulators. They’re hoping to have recommendations ready for HHS by the end of this month.
Healthcare.gov coming July 1
Filed under: Government, Health care reform, Health journalism
KHN’s Phil Galewitz previews the July 1 launch of a federal website he says “will give consumers a list of all private and government health care plans for individuals and small businesses in their areas,” a service required by the reform bill, and one that has never before been part of the modern system.
The initial site will just provide basic information on each plan, but a planned October upgrade will include what Galewitz called “detailed cost and benefits information,” the precise nature of which is still being negotiated. Insurance groups, predictably, say that sharing all the information HHS plans to provide will just lead to confusion and higher costs. Consumer groups disagree.
Insurers including UnitedHealthcare and Aetna say HHS is going too far in planning to list certain data, such as the percent of claims that health plans deny, the rate at which they cancel policies after customers get sick and the number of times patients appeal coverage decisions. They say the data would mislead potential customers.
…
The site can “be the great equalizer so consumers can have equal access to information and be on the same playing field as insurance companies,” says Elisabeth Benjamin, co-founder of Health Care for All New York, a consumer health care coalition. “The government needs to make the information as open as possible.”
Until 2014, when stricter provisions of the reform bill go into effect and such practices are no longer permitted, the site will list only the “sticker prices” of the plans, and insurers will still be allowed to charge sicker patients more.
AHCJ members get tips on covering rate hikes
Bryant Furlow of The New Mexico Independent reported that Blue Cross Blue Shield New Mexico was raising some premiums by about 21 percent. It sounds like a lot, but Furlow wanted to compare it to other states for context. So, he e-mailed the AHCJ electronic discussion list and asked members across the country what their local Blue Cross / Blue Shield increases looked like, and how state insurance regulators had been responding.
That same day, Jim Hall replied with thoughts and a link to his paper’s story about similar hikes in Virginia, and Diane Cochran of the Billings Gazette reported that Montana rates had jumped between 9 and 19 percent. News and links to Massachusetts’ own conflict with Blue Cross came from Kay Lazar at The Boston Globe and Felice Freyer of The Providence Journal offered another set of links from Rhode Island along with some veteran advice:
When you’re comparing among states, keep in mind that there’s a difference between the individual and group markets, with rates more volatile in the individual market. I think the huge California increase was in the individual market only. In RI, individual rates (called Direct Pay here) are tightly regulated and BC takes a loss on those products.
Within a few hours of his request, then, Furlow got data and advice that applied to his own story and hundreds of other health journalists gained context and story ideas they could use at their own publications.
Freyer has some additional cautions for anyone considering a comparison of plans and rates across state lines:
Be sure to compare individual-market rate increases with individual-market rate increases and group with group. Don’t compare individual rates in one state with group rates in another. If you are trying to find out whether the increases in one state are extraordinary compared with other states, you may be able to get at that only in a general sense. It’s hard to compare states because state laws, demographics and economic conditions vary.
The electronic discussion list is one of many benefits reserved for AHCJ members. For more information and a searchable archive, check our guide to the electronic discussion list. If you’d rather call it a Listserv, you’re in charge of getting the rights to the trademark.
What about rate hikes in your area?
Have you written about recent Blue Cross / Blue Shield increase? Share your stories – and any advice or tips you have – in the comments section below.
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