Health Insurance: Update on Current Issues

If you believe this is just a fluke with or without health insurance reform, be prepared for more.
Blue Shield of California is accused of overcharging for safety-net insurance
A Los Angeles woman says in a lawsuit that the health plan exceeded the state's maximum rates for policies sold to people who have lost their jobs or who have preexisting medical conditions.

By Duke Helfand, Los Angeles Times
July 8, 2010

A Los Angeles woman sued Blue Shield of California on Wednesday, accusing the nonprofit health plan of overcharging thousands of policyholders who bought safety-net insurance for people who were sick or jobless.

Amalia Lample said in her lawsuit that Blue Shield, the state's second-largest not-for-profit insurer, knowingly exceeded maximum insurance rates set by the state and falsely reported to regulators that the charges stayed within official guidelines.

Lample, 64, argued that she is owed $4,475 in excess charges she paid from 2007 to 2009. She said that more than 6,000 Blue Shield policyholders with similar coverage also were overcharged since 2001.

"This is for justice. It's not only for the money," said Lample, who decided to file her lawsuit in Los Angeles County Superior Court after reading a story in The Times about Blue Shield's rates. "It's not right what they do."

Blue Shield spokesman Tom Epstein said the San Francisco company had no immediate comment on the lawsuit, which seeks class-action status.

Blue Shield denied two refund requests by Lample, who filed a complaint with the California Department of Managed Health Care. Regulators said they could not conclude that Blue Shield had violated state law.

But Wednesday a department spokeswoman said the law's definition for calculating maximum rates was ambiguous, making it difficult to determine whether health plans were charging too much.

The department is sponsoring a bill in the Legislature to "eliminate any question" on rates insurers can charge, said the spokeswoman, Lynne Randolph.

At issue is health coverage available under the federal Health Insurance Portability and Accountability Act, or HIPAA. Insurers are required by the federal law to sell insurance to people who have lost their jobs or who would otherwise be ineligible because of preexisting medical conditions.

HIPAA policyholders maintain that Blue Shield and one of its chief competitors, Anthem Blue Cross, have substantially overcharged subscribers for several years.

Blue Shield has long maintained that its HIPAA rates comply with state guidelines.

Anthem determined that it had overcharged customers between 2006 and 2009, and agreed to issue refunds.

But one policyholder, Culver City attorney Les Greenberg, accused Anthem of returning only a fraction of what was due. Anthem had given Greenberg a $12 refund. He took the company to Small Claims Court. A judge agreed in September, awarding Greenberg more than $7,300.

Greenberg filed a lawsuit in December on behalf of another Anthem subscriber, saying the insurer owed additional refunds to more than 10,000 HIPAA policyholders. Anthem issued a statement Wednesday saying its refunds were "appropriate."

Greenberg also is representing Lample in the lawsuit filed against Blue Shield on Wednesday.

"They have gone off on a lark of their own to overcharge their subscribers," he said of the two insurers. "I would call it egregious behavior."

duke.helfand@latimes.com
latimes.com/news/la-fi-blue-shield-20100708,0,1302403.story Copyright©2010, The Los Angeles Times

And at the same time Big Insurance is taking you to the cleaners, the new "health czar" at Medicare/Medicaid wants redistribution of wealth -

You looking to boil your own blood this morning, watch this video. Donald Berwick, Obama’s recess appointment to be the administrator of the Centers for Medicare and Medicaid Services says (with a straight face) “Any health care funding plan that is just equitable civilized and humane must, must redistribute wealth from the richer among us to the poorer and the less fortunate. Excellent health care is by definition redistributional.”
http://www.thetradingreport.com/2010/07/08/your-new-healthcare-czar-we-must-redistribute-wealth/

The Importance of Being Earnest

In the Oscar Wilde play of the same name Wilde uses Lady Bracknell to embody the mind-boggling stupidity of the British aristocracy, while at the same time, he allows her to voice some of the most trenchant observations in the play.

Lady Bracknell state's “I do not approve of anything that tampers with natural ignorance. Ignorance is like a delicate exotic fruit; touch it and the bloom is gone. The whole theory of modern education is radically unsound. Fortunately in England, at any rate, education produces no effect whatsoever. If it did, it would prove a serious danger to the upper classes, and probably lead to acts of violence in Grosvenor Square.”

Perhaps we are dealing with mind boggling ignorance of the pundits in the new administration - and Members of Congress - when it comes to the health care debate.

If one is familiar with current health care concerns, they know all too well that people who are the "Medicare eligibles" and "Medicaid recipients" are in between the proverbial 'rock and a hard place' because they already are being turned away from care because of low reimbursement rates.

Now on top of the excessive costs and privacy risks of electronic health care records, Obama wants to further reduce reimbursement.

"...make big changes to health care, including lower reimbursements for Medicare and Medicaid treatments and prescription drugs."

We do not see any effort to reduce reimbursements, treatments and Rx from the health care plan used by members of Congress.

We also haven't seen any move to reverse the horrendous gift to the drub industry by Bushites AKA Medicare Plan D. Changes here would save millions, just starting with bidiing for supplying the drugs and elimination of the estra level of bureaucracy called "case management".

I remind you that it is a violation of the equal protection clause to continue these dualistic and more costly in the long term type of patches to the long broken health care system.

Your effort in learning what you can do to build your health is the key. You'll find some of our many health education programs at TOC, and of course we also offer consultation to you and to health care providers.

A move to reign in lobbyists is just as massive an undertaking - and of course we have the culture of bureacracy, something not unfamiliar with the new crew in the White House and the pack of hardline cronies with no vested interest in real change.

Obama challenges lobbyists to legislative duel
By CHARLES BABINGTON, Associated Press Writer Charles Babington, Associated Press Writer
Sat Feb 28, 3:39 pm ET

WASHINGTON – President Barack Obama challenged the nation's vested interests to a legislative duel Saturday, saying he will fight to change health care, energy and education in dramatic ways that will upset the status quo.

"The system we have now might work for the powerful and well-connected interests that have run Washington for far too long," Obama said in his weekly radio and video address. "But I don't. I work for the American people."

He said the ambitious budget plan he presented Thursday will help millions of people, but only if Congress overcomes resistance from deep-pocket lobbies.

"I know these steps won't sit well with the special interests and lobbyists who are invested in the old way of doing business, and I know they're gearing up for a fight," Obama said, using tough-guy language reminiscent of his predecessor, George W. Bush. "My message to them is this: So am I."

The bring-it-on tone underscored Obama's combative side as he prepares for a drawn-out battle over his tax and spending proposals. Sometimes he uses more conciliatory language and stresses the need for bipartisanship. Often he favors lofty, inspirational phrases.

On Saturday, he was a full-throated populist, casting himself as the people's champion confronting special interest groups that care more about themselves and the wealthy than about the average American.

Some analysts say Obama's proposals are almost radical. But he said all of them were included in his campaign promises. "It is the change the American people voted for in November," he said.

Nonetheless, he said, well-financed interest groups will fight back furiously.

Insurance companies will dislike having "to bid competitively to continue offering Medicare coverage, but that's how we'll help preserve and protect Medicare and lower health care costs," the president said. "I know that banks and big student lenders won't like the idea that we're ending their huge taxpayer subsidies, but that's how we'll save taxpayers nearly $50 billion and make college more affordable. I know that oil and gas companies won't like us ending nearly $30 billion in tax breaks, but that's how we'll help fund a renewable energy economy."

Passing the budget, even with a Democratic-controlled Congress, "won't be easy," Obama said. "Because it represents real and dramatic change, it also represents a threat to the status quo in Washington."

Obama also promoted his economic proposals in a video message to a group meeting in Los Angeles on "the state of the black union."

"We have done more in these past 30 days to bring about progressive change than we have in the past many years," the president in remarks the White House released in advance. "We are closing the gap between the nation we are and the nation we can be by implementing policies that will speed our recovery and build a foundation for lasting prosperity and opportunity."

Congressional Republicans continued to bash Obama's spending proposals and his projection of a $1.75 trillion deficit this year.

Almost every day brings another "multibillion-dollar government spending plan being proposed or even worse, passed," said Sen. Richard Burr, R-N.C., who gave the GOP's weekly address.

He said Obama is pushing "the single largest increase in federal spending in the history of the United States, while driving the deficit to levels that were once thought impossible."
___

On the Net:Obama address: http://www.whitehouse.gov
Copyright © 2009 The Associated Press.

Medicaid Reduction in Service as Bush Prepares to Leave Office.

The new regulation jeopardizes community-based health services, including screening, diagnostic and dental services for children, as well as lab and ambulance services.

In line with the current administration's plans to issue, or relax, many economic, environmental, health and safety rules before they leave office on Jan. 20, this impact on the poor is a political favor now for a surge in costs later as illness rates rise and insurance payments fail to meet cost.

Keep in mind that members of Congress did little to address this sweeping change, so hope they will re-visit the issue in January.

November 8, 2008
New U.S. Rule Pares Outpatient Medicaid Services
By ROBERT PEAR
WASHINGTON — In the first of an expected avalanche of post-election regulations, the Bush administration on Friday narrowed the scope of services that can be provided to poor people under Medicaid’s outpatient hospital benefit.

Public hospitals and state officials immediately protested the action, saying it would reduce Medicaid payments to many hospitals at a time of growing need.

The new rule conflicts with efforts by Congressional leaders and governors to increase federal aid to the states for Medicaid as part of a new economic action plan.

President-elect Barack Obama has endorsed those efforts. At a news conference on Friday, he said that legislation to stimulate the economy should include “assistance to state and local governments” so they would not have to lay off workers or increase taxes.

In a notice published Friday in the Federal Register, the Bush administration said it had to clarify the definition of outpatient hospital services because the current ambiguity had allowed states to claim excessive payments.

“This rule represents a new initiative to preserve the fiscal integrity of the Medicaid program,” the notice said.

But John W. Bluford III, the president of Truman Medical Centers in Kansas City, Mo., said: “This is a disaster for safety-net institutions like ours. The change in the outpatient rule will mean a $5 million hit to us. Medicaid accounts for about 55 percent of our business.”

Alan D. Aviles, the president of the New York City Health and Hospitals Corporation, the largest municipal health care system in the country, said: “The new rule forces us to consider reducing some outpatient services like dental and vision care. State and local government cannot pick up these costs. If anything, we expect to see additional cuts at the state level.”

Carol H. Steckel, the commissioner of the Alabama Medicaid Agency, said the rule would reduce federal payments for outpatient services at two large children’s hospitals, in Birmingham and Mobile.

Richard J. Pollack, the executive vice president of the American Hospital Association, said these concerns were valid.

“The new regulation,” Mr. Pollack said, “will jeopardize important community-based services, including screening, diagnostic and dental services for children, as well as lab and ambulance services.”

Herb B. Kuhn, the deputy administrator of the Centers for Medicare and Medicaid Services, defended the rule.

“We are not trying to deny services,” Mr. Kuhn said. “We want to pay for them more accurately and appropriately. Payments for some services were way higher than they should be.”

The rule narrows the definition of outpatient hospital services to exclude those that could be provided and covered outside a hospital.

In May, the White House said it wanted to avoid the rush of “midnight regulations” that had occurred at the end of other administrations. But Bush administration officials said this week that they still intended to issue, or relax, many economic, environmental, health and safety rules before they leave office on Jan. 20.

Medicaid, financed jointly by the federal government and the states, provides health insurance to more than 50 million low-income people. Services can often be billed at a higher rate if they are performed in the outpatient department of a hospital rather than in a doctor’s office or a free-standing clinic. Hospitals generally have higher overhead costs.

Matt D. Salo, a health policy specialist at the National Governors Association, said, “The new rule is consistent with the administration’s effort to squeeze, shrink and flatten Medicaid spending.”

In a recent letter, the governors urged Congress to increase the federal share of Medicaid for at least two years. With state tax revenues plunging, many governors are considering cuts in Medicaid and other programs. Such cuts, they say, would further depress economic activity.

Ann Clemency Kohler, the executive director of the National Association of State Medicaid Directors, said: “The new rule is a pretty sweeping change from longtime Medicaid policy. Since the beginning of the program, states have been allowed to define hospital outpatient services. We have to question why the rule is being issued now, three days after the election, with a new administration coming in.”

The rule was proposed in September 2007. It takes effect on Dec. 8, six weeks before Mr. Bush leaves office.

Ms. Kohler said the rule would cut “money going to the states, to safety net providers, at a time when states are really being stressed.”

“More and more people are coming onto Medicaid,” she said. “People are losing their jobs and running out of unemployment benefits. Some employers can no longer afford to provide health insurance to their workers.”

In the last 18 months, Congress has imposed moratoriums on six other rules that would have cut Medicaid payments. But the administration says Congress did not block the rule issued on Friday.

Larry S. Gage, the president of the National Association of Public Hospitals, said, “We will urge Congress to extend the moratorium to this rule, and we will ask the Obama administration to withdraw it.”

Copyright 2008 The New York Times Company

And in other news we find Big Pharma (one great group of very substantial contributions to 'W') being cited for prolific Medicaid billing fraud.

Kansas is suing to recover millions in over payment -

According to the lawsuit, the Medicaid program spent more $160 million on meds last year. And the suit alleges the price for a drug paid by the state, based on a fraudulently-reported Average Wholesale Price and other price indicators, often bears no relationship to the true price and can exceed 100 percent to 200 percent above the actual price.

One example cited - Dey reported an AWP of $44.10 for Ipratropium Bromide, yet the AG claims the drugmaker sold the same drug to retail pharmacists for $8.35 - a 355 percent difference. And Glaxo reported an AWP of $128.24 for Zofran, but charged $22.61- a 450 difference.

Perhaps is the current administration would move to prosecute Big Pharma for the egregious activity the recovery would save Medicaid from current cuts. The FDA might be cleaned up a little at the same time, and don't they need an overhaul!

WARNING: I once blew the whistle on perpetrators of Medicare fraud involving Washington state. Instead of doing an accurate investigation, Mike Gregoire, husband of the the current governor and formerly with the Medicaid Fraud unit in the AGs office (at a time when his wife was AG), he feel into lock step with the typical bureaucratic cover-up: Protect the System First.

Fortunately my contacts at the Region X HHS OIG office was glad to take my data. DOJ was prosecuting the company I tried to report to Gregoire for insurance fraud in ten states.

The FEDS won this case and got a $372 million settlement.

Former state legislator Dave Schmidt did do a proper investigation, finding egregious errors by the state. He assisted me in regaining my status. DOH still is covering up. Mike and some DOH cronies continued the fraud by "loosing" legal documents and ignoring fact. Funny though that the AAG assigned to represent the state came out in favor of my facts and me. Former gov Gary Locke ignored the facts too and went so far as to cover up for DOH lies, at a time when he agreed to a request by a US Congressman to investigate. Locke refused to look at my eveidence. Locke and Mike's wife are law school grads and should know very well about due process and equal protection. I can't say for sure, but they went very far to attack the messenger here. And lost some recovery money as well. For shame.

Fraud has many faces.