Bill would let companies buy RI hospitals in bulk
I’ve been talking about the Hospital Conversions Act a lot lately. That’s because Steward Health Care System can’t buy Landmark Medical Center until it gets permission from state regulators. The Hospital Conversions Act guides that decision.
(If you need more background, check out my earlier post.)
This week, three senators sponsored a bill in the General Assembly that would alter the Hospital Conversions Act. The legislation doesn’t do much to the actual process for approving a hospital merger or sale; it’s more concerned with how many hospitals a for-profit can buy in a given year. Here’s what the proposed legislation says-
Notwithstanding any other provision in this chapter, nothing herein shall be construed to prohibit a for-profit hospital, its subsidiaries or affiliates, from applying for, and receiving approval of a conversion of more than one hospital in the same year, or any subsequent year, and each such application shall require review and approval from the department of attorney general, and from the department of health in accordance with the provisions of this chapter.
This act shall take effect upon passage.
Basically, the bill would make it possible to buy more than one hospital in a year, or within multiple years. Right now, for profits have to buy one hospital at a time and wait three years until they try to purchase another.
Now why would Senators Picard, Ruggerio, and Cote introduce this legislation? Is there someone out there that wants to buy Rhode Island Hospitals in bulk? Two for the price of one? Buy one, get one half off?
Two of these senators are from Northern Rhode Island- Picard represents Woonsocket and Cote represents North Smithfield. Might this have something to do with Landmark’s buyer? Nothing confirmed yet.
I’ve been told the HCA three year waiting period existed so regulators could watch a for profit in action- did it keep all those promises it made when it bought the first hospital? The regulation was meant to prevent an outsider from suddenly and completely overtaking our health care system. But that was then.
Now, community hospitals in Rhode Island are struggling. They can’t bargain for the same reimbursement rates that hospital networks can. For many, the solution lies in being a part of a larger system. Is it better to let one for profit own most of them or watch many for profits buy them up and further fragment the system?
Then again, do we want to give an outside for-profit company that much power? And if we change our standards for these companies, should we protect our own kind and make it easier for non-profits like Lifespan and Care New England to merge?
Tricky questions in an era where health care is changing. Would you support this legislation?
The plan for avoiding emergency rooms
It’s a common complaint- emergency rooms are often full of people that don’t need to be there. Unfortunately, the most expensive place to get medical care is also the default for a lot of people- folks without insurance, people with health concerns after hours, and Rhode Islanders with mental health or addiction struggles.
A special Senate commission is tackling how to better care for that last category of patients. They’ve been meeting since last November to sketch out a system that effectively treats mentally ill or addicted Rhode Islanders without throwing them into an expensive hospital bed. One physician participating in the group puts the problem this way-
We are providing an extremely expensive taxi through the use of municipal ambulances and RIH [Rhode Island Hospital] is the most expensive hotel in the City for this population with an average stay of $650 for a turkey sandwich and place to sleep.
The group released a rough draft of its final report today. It’s still a working document, testimony from a round table discussion today might change the contents slightly, but the broad strokes will stay the same.
The report first details the problem- a small sliver of Rhode Islanders use emergency rooms more than four times a year. Many get expensive and unnecessary ambulance rides. The report says-
EMS personnel estimate that 10% of ambulance transports were for actual medical emergencies.
As for the other 90% of the ambulance rides, they’re not only unnecessary, they’re often done for free. The report estimates that in Providence alone, city firefighters and police officers provide about $800,000 to $1.3 dollars in unpaid transportation services.
So what can we do about this? The commission proposes a few things-
1. Change protocols that make it difficult to take patients anywhere else.
Currently, state rules say medical technicians have to take “intoxicated persons and persons incapacitated by alcohol” to a place that provides “emergency treatment” and is affiliated with or connected to a hospital. That pretty much rules out community treatment centers.
The rules also say the patient must be assessed by a “licensed physician.” That leaves out other folks (nurse practitioners, licensed physician assistants, etc) who could easily do that job for less money in another setting.
To do something about this, the commission proposes a change to state’s alcohol statute to allow for a “pilot period” where intoxicated Rhode Islanders have the option of being evaluated in the community by other types of licensed health care providers.
2. Create a pilot program testing community options.
When I spoke with Senator Josh Miller, the co-chair of the commission, he said the group plans to propose legislation for a pilot program. The pilot would use non-emergency vehicles to transport intoxicated or mentally ill Rhode Islanders to the most appropriate treatment location.
The pilot would demonstrate whether this new approach actually saves money and improves results. It would be run by a community provider that already works with this community. Miller says the state would probably have a RFP (request for proposals) process to select one of them.
Those are the highlights for me, but here are the other proposals in the report-
- Create a state-wide care partnership
- Use special Medicaid funding to accomplish some of these goals
- Help health care providers and first responders use “suicide/mental health assessment tools.”
- Develop stable housing options for the homeless.
Miller says he’s hoping the General Assembly will approve the pilot program this year. If all goes well, the state would select a group to run it by the end of the year.
What do you think? Does this sound like a smart solution? Will it work?
Updates from RI’s health exchange crush
The working group devoted to designing Rhode Island’s health insurance exchange met today at 7:30am. I was busy taking a shower, so I can’t give you a report on the meeting.
But I do have something to offer- advice from another state. Rhode Island might have been the first local government to win the second round of federal funding for the exchange, but it’s not necessarily first in everything. The folks working on RI’s online marketplace for health insurance tell me they have a little bit of a crush on the bureaucrats in Oregon.
Why? They tell me Oregon is further ahead in its efforts to build the actual technology to make this website happen. The public corporation in charge of the exchange has already partnered with a vendor and even written a draft of its business plan.
I grew up in Portland, Oregon and I’m always excited to make connections between my home state and my current home. So, I chatted with Lisa Morawski, from Oregon’s Health Insurance Exchange. At the time, she told me she didn’t have an official title because the organization was so new, but she described her job as “communications.” Here are some tidbits from our conversation earlier this month-
The Pulse: Rhode Island has found that it’s sometimes difficult to explain why the state is creating this health insurance exchange. How do you talk about it to Oregonians?
Lisa Morawski: A lot of times it is hard to explain because there’s nothing like it yet in the marketplace. A lot of times we’ll compare it to a Travelocity, which kind of resonates with people in that it’s a place where you’re going to be able to go and search for things that are important to you about health plans, whether that’s the cost or whether it includes a certain provider. And put your choices in and the exchange will be able to present options to you for buying health insurance.
In terms of why we’re developing it and the value that it brings, it will be the first time there is a central place where people can really go and compare health plans and really compare them apples to apples. That’s just not available right now. It also will be one place where people can go for all kinds of health coverage… You can just go to one spot and put in your information and the system will figure out whether you’re eligible to buy a commercial plan and if you are, if you qualify for the federal tax credits that are available. But it will also tell you if you’re available for one of the public programs like Medicaid. It will do one application and you can enroll in any of those plans.
The small business piece of the exchange is also going to be pretty unique. Our goal in Oregon is to actually let employers do what’s called a “defined contribution model” where they say “OK, I’m going to pay X amount towards your premiums as an employee and you can go to the exchange and shop for all the plans that are offered on the exchange.”
The Pulse: The folks in Rhode Island say Oregon is known for being farther along in terms of implementing the technology to make this health exchange happen. So tell me what you’ve done so far in terms of the actual website.
Lisa Morawski: Basically what we’ve done, we’re partnering with another state agency here that does Medicaid and Human Services type functions, we’re partnering with them on the IT piece so we develop a single IT system for both Medicaid eligibility and commercial health insurance. We actually chose a vendor. We’ve purchased an Oracle suite of software programs. So we’re really developing our system right now. And it’s challenging because we’re still waiting for a lot of requirements from the federal government.
The Pulse: So you’re ahead of the federal government in terms of what you’re supposed to be doing?
Lisa Morawski: Well, no, I just mean that the federal government is still developing requirements for the exchanges. We don’t know exactly what everything looks like for instance, around eligibility. But we’re developing our system in chunks if you will, so we can keep moving forward while waiting for new information.
The Pulse: So if I were to go on to the beta version of the exchange right now, how far could it take me? What have you accomplished so far?
Lisa Morawski: Well we have a prototype coming out in the spring. So we’ll have something people can actually look at. I probably can’t tell you in a lot of detail what all they’ve built so far, but we are scheduled to release a prototype this spring.
The Pulse: Rhode Island says it’s excited about the kind of technology work that you’re doing. Do you see the possibility of sharing what you’ve accomplished with other states?
Lisa Morawski: Yes. Definitely. That’s part of the early innovator grants that went to the seven states. Whatever we develop with that grant money we’ll be sharing with other states.
The Pulse: So what can be shared and what is proprietary?
Lisa Morawski: Oh, I don’t know exactly to that detail. I could probably get back to you on that. [In a later email, Morawski wrote- "We will be sharing our planning and system configuration with other states, but if someone wanted to duplicate our system, they would have to buy the same Oracle products that we purchased."]
The Pulse: Do you see Oregon and Rhode Island collaborating together in any way?
Lisa Morawski: I’d probably have to check to see if any of our folks have talked to anybody directly in Rhode Island. Like I said, as part of being an earlier innovator state, we’re definitely willing to share our solutions with all other states, so it’s something we’re open to. But I don’t know specifically if some of our folks have talked to Rhode Island. I know we’re in contact with a lot of other states. We tend to talk to Washington a lot just because they’re our neighbor.
The Pulse: Do you have any advice for Rhode Island? Are there any mistakes you made or learning moments that you feel comfortable talking about?
Lisa Morawski: One think I think has been really important to use in our work is stakeholder outreach. We’ve really been trying to involve lots of different groups… I think just in general, communicating with people to find out what they’re looking for in the exchange and talk through options to see what’s going to work. I think that’s been really helpful for us.
Still want to know more about the Oregon Health Insurance Exchange? Geek out and read the public corporation’s business plan.
More on home birth
If you missed it last week, check out my feature about home birth in Rhode Island.
This story took a long time to produce, partially because I had a lot to learn, but also because I was fascinated by some of the finer details that couldn’t fit into a seven minute radio piece. So please indulge me while I wrote about a few of them here.
The story that aired on our station gave you a basic outline of home birth in the state- in 1988 two babies died at home, the attending midwife lost her license, and then for almost 20 years there were no RI licensed midwifes delivering babies at home. But check out this chart from the Rhode Island Department of Health. Home births still happened between 1988 and 2007. You might have to click on the image to see it better.
Look at the data for 1990- fifty home births happened two years after the only legal home birth midwife lost her license. What’s going on here?
Well, for one, not all of these home births are planned. It counts as a home birth whether you have a kiddie pool set up in the living room or you just couldn’t make it to the hospital. But that doesn’t account for all of the births. I mentioned this briefly in the piece- Massachusetts midwives were coming into the state and delivering a lot of these babies.
At the time, it was the only way Rhode Island women could get professional help with their home births. But the whole situation was very complicated- how do you coordinate care at the hospital if something goes wrong? Who signs the birth certificate?
In 2007, when Michelle Palmer started offering home births in Rhode Island, these unlicensed midwives continued to practice in the state. For some, they offered an alternative to the one and only licensed midwife offering the service, but for others it created even more complications.
Mary Mumford Haley became the sole home birth midwife in the state when Michelle Palmer moved to New Zealand. She says she tries to protect the reputation of midwives like her by being extremely cautious about what kinds of babies she’ll deliver. No babies from moms who had cesarean sections in the past, no twins, no breached babies, and no babies that have been in for more than 41 weeks. That’s because all of these characteristics make it more likely something could go wrong during birth.
Women who wanted a home birth but didn’t fit Mumford Haley’s specifications often went to Massachusetts midwives who had a different philosophy about what constitutes a serious risk. That makes Mumford Haley nervous. She told me-
When you’re practicing underground and you know your only commitment is to the woman… that allows you a whole lot more freedom to do what she wants. Because now she’s employing you, you’re not beholden to any other body and you’re just being with the woman. That’s different than when you want to create a practice that is respectable to the community.
Massachusetts doesn’t license its home birth midwives, so in some ways they have nothing to lose when they come into this state. Mary Mumford Haley says she knows midwives who say they wouldn’t perform some of the risky births they do if they had a license that was at stake.
But out of state midwives are often put in an odd position themselves. Mumford Haley says she knows some women so set on home birth that they claim they’ll do it themselves if no one agrees to assist them.
And on some levels that’s a threat. And I think that’s an unfair thing to do to any other human. And I know there have been midwives that are pulled over their own boundaries of safety because of that. And that’s a tough place to be.
All of this was coexisting in a messy way until the RI Department of Health decided it had to do something about the out of state midwives. It sent a cease and desist letter to a Massachusetts woman delivering a lot of babies in the state. The folks I spoke to say the move scared a lot of out of state midwives, many of whom stopped offering their services in Rhode Island. That left women with riskier pregnancies with no one willing to deliver their babies. There was talk of renting hotel rooms in Massachusetts so moms could still have a “home birth” experience, but I’m not sure if anyone actually did that.
That’s how I eventually came to this story. A woman expecting twins was so upset she couldn’t have a home birth in Rhode Island she sent me an editorial entitled “Rhode Island Restricts Women’s Birth Choices.” I’d already heard that the state only had one licensed midwife offering home births, so this added controversy was all I needed to look into this subculture.
It’s strange. On the one side you have licensed midwives offering home births who have to prove to the medical community that what they do is legitimate. They’re facing skepticism every day, especially following those deaths in 1988. On the other hand, there are women in Rhode Island who says these midwives aren’t doing enough- they should be willing to deliver twins or babies after a cesarean or what have you. The home birth midwives are either too out there or too strict.
Meanwhile, it’s nearly impossible to get health insurance coverage for home birth. That’s why the state’s home birth midwives only accept cash. It costs about $4,000 to have a home birth. My friend Beatrice McGeoch had to tangle with United Health Care for about three months before she was reimbursed for the birth of her daughter Freya. Blue Cross Blue Shield tells me it does cover home births but -
We just recently defined our policy on this topic and it is not yet down on paper, although we do currently provide reimbursements for home births. When it is articulated in hard copy, it will be available.
Will all this extra work- paying out of pocket, fighting with the insurance company, finding the one and only legal home birth midwife in the state, why do people do it? Beatrice’s husband Eric puts it this way-
This was definitely worth the cost of buying a used car… When I was born, my dad got to be in the ER room. And when she was born I literally got to be a real part of it and catch that baby on the way out. It was so powerful. Me and Freya have a really good bond and that might be part of it for me.
What do you think? Would you pay $4,000 to have your baby at home?
Judge says AZ must license med. marijuana dispensaries
It’s as close of a comparison as you can get. Like Governor Lincoln Chafee, Arizona Governor Jan Brewer received a letter last year from the state’s top federal prosecutor, warning her that medical marijuana dispensaries violated federal law and were vulnerable to raids.
She responded, like Governor Lincoln Chafee, by halting the state’s dispensary program. Now a judge is forcing her to start licensing those medical marijuana retail stores. According to the Yuma Sun,
A state judge has ordered Gov. Jan Brewer to finally fully implement the 2010 voter-approved Medical Marijuana Act, saying she acted illegally in holding it up.
Maricopa County Superior Court Judge Richard Gama rejected the governor’s argument that she has the discretion to delay enactment of parts of the law while she sought a ruling from another court about the liability of state workers under federal drug laws.
Adjusting those Blue Cross Blue Shield rate changes
So, you probably already know that Blue Cross Blue Shield of RI is no longer asking for a 4.4% rate increase. The health insurance company reduced its request to 2.4% at a public hearing earlier this week.
But something else is different too. After reading my post about its changes to deductibles and out of pocket limits, Blue Cross said I’d left out an important detail. Here’s what the company told me about its Healthmate direct 500/1000 plan and its Healthmate direct 2000/4000 plan.
In 2011, the deductible did not apply to the out of pocket max. However, in 2012 the deductible amount applies to the out of pocket maximum.
Essentially, when you look at the out of pocket maximum for the old plans, that’s actually NOT the maximum. The most you would pay out of pocket is that amount PLUS your deductible. But that’s only in the case of the 500/1000 and 2000/4000 plans.
This detail wasn’t mentioned anywhere on BCBSRI’s explanation of its current benefits. If this was your health plan, you’d only see it in writing in your subscriber agreement. Here’s the relevant text-
The deductible, infertility treatment copayment, flat dollar copayments, and prescription drug copayment do NOT apply to the maximum out-of-pocket expense; therefore, the level of coverage will not be increased to 100%.
My apologies for getting this wrong, but perhaps it’s an indication that this information needs to be more accessible. If I missed this detail after several hours of research, someone who doesn’t do this for their job might miss it too.
So how does this new information change the ACTUAL cost increase for people on these plans? Here are the new calculations, using myself as an example.
This is much lower than the cost increase calculated in my earlier post, which put the extra cost at $1,346 or an increase of 9.64%. Here, the difference is minor. But the cost increase for the 2000/4000 plan is still significant.
Before, when I thought the deductible counted towards the out of pocket limit, I calculated the cost difference as $9,516 more than the old plan at a cost increase of 74.18%. Now it’s a cost difference of $5,516.60 or a 32.78% increase. Still, much more than a 2.4%.
Gary Alexander adviser touts benefits of semen
It’s been about a month since we checked in with Gary Alexander, RI’s former director of the Department of Human Services and the former secretary for the Rhode Island Executive Office of Health and Human Services. He’s currently the Secretary of Public Welfare for the state of Pennsylvania.
You might know him for his plans to become a Rhode Island landlord.
Then there was the discredited report he wrote, claiming Rhode Island’s Global Medicaid waiver saved the state $110 million dollars in 18 months. It actually saved about $23 million over three years.
Here’s a new tidbit. According to the Philadelphia Inquirer, an employee hired by Alexander is resigning after details emerged about his second job editing a “conservative faith-based journal.” He also wrote articles for the publication-
For instance, he wrote about research that he said showed that if women wanted to find “Mr. Right,” they should shun birth control pills; and if they wanted to improve their mood, they should not insist that their men wear condoms lest they miss out on beneficial chemicals found in semen.
Robert Patterson, the former welfare adviser, is still listed as the editor of the Family in America publication, which describes itself as a monthly periodical that-
…seeks to clarify the importance of the family in binding generation to generation, inspiring love and intimacy in the home, and fostering industry and lawfulness within the broader community.
According to The Philadelphia Inquirer, Patterson wrote about the “misguided” polices of the war on poverty and blamed them for keeping women away from their appropriate roles as stay at home mothers. All the while, he worked for the government department administering those exact programs.
How much did Gary Alexander know about his employee’s other life? The Philadelphia Inquirer didn’t get much of a response from a spokeswoman.
She would not say why Welfare Secretary Alexander had hired him, whether Alexander was familiar with his writings, or whether he agreed with Patterson’s oft-expressed view that many social welfare programs have worsened the lot of the poor by promoting single motherhood and displacing marriage as a way out of poverty.
Blue Cross reduces rate request to 2.4%
So, this morning I went to the public hearing on Blue Cross Blue Shield’s average 4.4% rate request. I listened to the public testimony and left while the hearing officers went over the formal paperwork. I probably should have stuck around, because Blue Cross made a change to its proposal. Check out item four in BCBSRI’s position statement. Here’s the relevant portion-
Since the filing, Blue Cross has worked to negotiate lower pharmacy costs beginning in 2013 which has resulted in Blue Cross reducing the average increase to approximately 2.4 percent. The filing does not include any contribution to reserves.
Blue Cross also pointed out some data I missed in my explanation of its proposed changes to deductibles and out of pocket limits. I’ll write an explanation of what I missed as soon as I clarify a few points.
Unpacking BCBSRI’s rate request part 2 UPDATED
UPDATE: These calculations don’t reflect the fact that deductibles DID NOT count towards the out of pocket limits for the old plans but they do for the new ones. See new charts reflecting the difference here.
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I’m taking a closer look at Blue Cross Blue Shield’s proposed rate increases and plan changes for Rhode Islanders who buy their own insurance (often called “direct pay” customers). Part one explained what those plan changes look like. For part two, I’m calculating how much someone might pay under the proposals. I’m using myself as an example.
I’m a healthy 29 year old woman who pays for a family health care plan. Let’s assume I qualify for BCBSRI’s “Pool II” preferred rate. “Pool II” plans are a cheaper option for folks without expensive chronic illnesses.
According to this chart, I’d pay $775.90 a month under the new Vantage Blue Direct 1500/3000 plan. The old plan charged me $747.06 a month. Not a big change. But let’s say I get sick, or someone in my family needs medical care. How much more could I pay a year? Here are the costs if my family was on Healthmate Direct 500/1000.
This chart calculates the difference in how much I’d have to pay if I actually used my insurance. It’s an increase of $1,358 or a rate increase of 9.73%. Now of course, if you’re healthy you won’t notice these changes.
Let’s try one of the other health plans. What about Healthmate direct 2000/4000-
Whoa. High deductible plans are supposed to offer low monthly premiums in exchange for a higher deductible. It’s appealing to healthy people who don’t have many medical needs but still want the security of health insurance. You might have to spend $2,000 /$4,000 before your health plan kicks in, but you’ll have help paying the bills if you get hit by a car or develop cancer.
Under the changes for this plan, if I had a terrible injury I’d pay a total of $22,345 out of pocket, or $9,516 more than the old plan. At a cost increase of 74.18%, that’s not the kind of financial protection I’d expect from my health insurance. How many people have an extra $9,000 to spend on medical emergencies?
But before folks start throwing stones at BCBSRI, remember- for the most part these charges reflect the actual cost of health services. For every dollar you send to your health plan, about 82 cents pay for actual medical care.
Health insurance plans have to find that money somewhere. In the short term, BCBSRI had to choose- request a double digit rate increase or hide the charges. I’m just showing you where they are.
Unpacking BCBSRI’s rate request
Blue Cross Blue Shield of RI (BCBSRI) wants to increase its premiums by about 4.4% for folks that buy their own health insurance. If you’re one of those 15,200 so called “direct pay customers” you can testify about the request at a public hearing next Tuesday, January 17th.
But before you do, let’s talk about Blue Cross Blue Shield’s proposal. The request includes not just a rate increase, but changes to cost sharing and deductibles as well. I wrote about some of those adjustments in an earlier post, but I wanted to take another crack at explaining what’s different.
Let’s start with the changes to BCBSRI’s health plans. Here they are, side by side based on BCBSRI’s letter to Health Insurance Commissioner Christopher Koller and BCBSRI’s explanation of its current benefits.
The changes to the Healthmate direct 500/1000 plan are pretty simple- the deductible increases by $500 for individuals and $1,000 for families. That means if you have a health emergency and this is your health plan, you’ll have to pay $500 or $1000 more before your health insurance kicks in.
That’s also true for the “out of pocket maximum.” It used to be that the most you’d have to pay for your health care in any given year was $2,500 as an individual or $5,000 as a family. That number is now $3,000/$6,000.
You see the same increase in deductibles for the Healthmate direct 1000/2000. Deductibles here go up by $500 for individuals and $1,000 for families. Out of pocket maximums jump by even more- an increase of $1,500 for individuals and $3,000 dollars for families. Also notice that plan used to pay for diagnostic tests, x-rays, and lab fees. Now you’re responsible for paying for those services until you reach your deductible. After that, you pay 20% of the cost.
Healthmate direct 2000/4000 follows the same trend. Deductibles increase by $500 for individuals and $1,000 for families. But check out the out of pocket maximums. They skyrocket to a $4,500 increase for individuals and a $9,000 jump for families.
Healthmate direct 3000/6000 doesn’t have a change in deductibles, but it does switch from covering the entire cost of medical procedures/appointments/diagnostic tests to charging you 20% of those costs until you reach your out of pocket maximum. That’s changed as well- $2,000 more for individuals and $4,000 more for families.
Of all of BCBSRI’s plans, Healthmate direct changes the least. The only difference is a tiny change in out of pocket maximums- $100 increase for individuals and $200 increase for families.
What do all of these changes mean for direct pay customers? The rate increase for your premium might be 4.4%, but add up all of these changes and you could pay much more if you get sick or injured.
There are so many plan iterations and different charges based on age and health that I can’t calculate the price difference for everyone. But I can talk about myself. In my next post, I’ll calculate what I would pay under the changes. Here’s a hint-it’s more than 4.4%.
