theJeanneScottletter

HEALTH CARE REFORM UPDATE

Update #414

August 27, 2008

Copyright:  Jeanne Scott Matthews, 2008

HIGHLIGHTS IN THIS ISSUE

HEADLINE NEWS

1.     The Number of Uninsured is DOWN, at Least as of the End of 2007

2.      But the Cost of Covering the Uninsured is UP, over $122 BILLION a year

3.     Workers With Insurance Still Can’t pay Their Bills

4.     CM² Braggadocio: Falling Down in the Area of Fraud and Abuse

HIPAA: NOW AND FOREVER

5.     Wordsmithing and Coburn: The Result No Federal Support for Healthcare I.T.

6.     Privacy Changes in the House Version of an EHR Bill

7.      “Corrective Action Orders” Fill the Bill, Says the OCR

ELECTION 2008

8. Just What are the Differences Between Obama and McCain?

THE PHARMACY CORNER

9. Medicare Part D: the Donut Hole and Its Impact

***

Editor:  Jeanne Scott Matthews

(480) 983-5586

jeanne.scott@health-politics.com

Quotes of the Week

***

"The U.S. stands out for being the only country ... that reports significant fractions of the population not getting needed care."

-- Commonwealth Fund President Karen Davis, on a new report outlining the growing problem of medical debt as it weighs upon the average American family. [See, Report #3, below]

***

"We attributed these review discrepancies to the ... contractor's reliance on clinical inference rather than additional medical records available from health care providers, CMS' inconsistent policies regarding proof-of-delivery documentation, physicians' lack of understanding of documentation requirements and CMS's lack of procedures for obtaining information on high-risk DME items from beneficiaries."

-- DHHS Inspector General Daniel Levinson, in a report, heavily criticizing CM² over its “claimed” success in auditing Medicare DME fraud and abuse. [See, Report #4, below]

***

"I highly urge that the appropriations hearing be held in order to determine the cause of this alleged misreporting." 

-- Housecritter Ileana Ros-Lehtinen (R-Fla.) in a letter asking House Oversight and Government Reform Committee Chair Henry Waxman (D-Calif.) to hold hearings on the question as to why CM² claimed far greater success than actually achieved. [Report #4, below]

***

"We keep wordsmithing and wordsmithing. Health I.T. is so significant and so important that everyone wants their fingerprints on it, and that is delaying the legislation.” 

-- Senatecritter Mike Enzi, speaking on delays that have tied up a bill that would give new impetus and most importantly funding to building an electronic health record.”  [See, Report #5, below]

***

 "We have found that [corrective action orders are] the most effective way to obtain industry compliance with the privacy rule."

-- Susan McAndrew, deputy director of health information privacy at DHHS’ Office of Civil Rights, says that her office has resolved 6,800 HIPAA complaints through corrective action orders. [See, Report #7, below]

***

"The Medicare drug benefit has produced tangible relief for millions of people, despite the unusual coverage gap that was created to make the benefit fit within budget constraints. But if a new president and Congress consider changes to the drug benefit, it will be important to keep in mind that the coverage gap has consequences for some patients with serious health conditions."

-- Kaiser Family Foundation President and CEO Drew Altman, commenting on a new study outlining the impact of the Medicare prescription drug benefit program on American seniors. [See, Report #8, below]

**********************

HEADLINE NEWS

 (1)

U.S. CENSUS BUREAU RELEASES NEW FIGURES ON THE UNINSURED

"Income, Poverty, and Health Insurance Coverage in the United States: 2007," U.S. Census Bureau: The Census Bureau on Tuesday released findings from the Current Population Survey that show both the percentage and number of U.S. residents without health insurance decreased in 2007. The percentage of U.S residents without health insurance was 15.3% in 2007, down from 15.8% in 2006, and the number of uninsured was 45.7 million in 2007, down from 47 million in 2006. The percentage of people covered by private health insurance fell from 67.9% in 2006 to 67.5% in 2007, while the share of people covered by public programs such as Medicaid rose from 27% to 27.8%. ("Income, Poverty, and Health Insurance Coverage in the United States: 2007," August 2008).

Just Between You and Me: While the numbers were surprising, raising a suggestion in some quarters, that they have been deliberately manipulated to “lessen” the potential impact of a health care “crisis” on November’s presidential election, they do not tell the real picture of health insurance in America as of September, 2008. Several major factors have been left out of the 2007 report: (1) the impact of President Bush’s late in 2007 veto of an expansion of the State Children’s Health Insurance Program (a veto with John McCain’s announced support); (2) the impact of 2008 changes in CM² policy and requirements limiting states in expanding S-CHIP and Medicaid in an effort to cover even more children; (3) growing concern among several of the states that Medicaid will have to be curtailed as part of shrinking state budgets and the slowing economy; and (4) increasing numbers of lay-offs and growing national unemployment numbers during the first 8 months of 2008, none of which are included in the Census Bureau’s 2007 report.

Also not surveyed or included, the rising number of UNDERINSURED Americans, forced to opt into high deductible health plans. These people are nominally INSURED, but unable to pay the bill when a sudden illness or accident happens. Recent studies from the Kaiser Family Foundation, Consumers Reports and Families USA, have stressed the growing problem of “underinsurance” and its impact on American families. 

*************************************

Jeanne’s Legal Quote of the Week

-- Attributed to Jeremy Bentham (1748-1832)

*************************************

(2)

THE UNINSURED: COST TO THEM, COST TO US/U.S.,

AND COSTS YET UNKNOWN

Uninsured U.S. residents will spend about $30 billion out-of-pocket on health care this year, while other parties -- mainly the government -- will spend about $56 billion on uncompensated care for the uninsured, according to a study published online Monday in the journal Health Affairs. The report, by Jack Hadley of George Mason University and colleagues, found that government programs -- including Medicare, Medicaid and state and local programs -- pay about 75%, or $42.9 billion, of the amount uninsured individuals are unable to pay for services received. Some physicians and hospitals also donate time or forgo profit to care for low-income residents, and in some cases private donations cover the costs. While difficult to assess, some estimates of this uncompensated care raise the total cost of the uninsured – and indirect tax, being paid by all of us in one way or another – to nearly $123 BILLION annually.

The report defined uncompensated care as the difference between the amount the uninsured paid and how much health care providers would have received if the patients had been privately insured. The report found that the total additional cost to the health system of covering all uninsured U.S. residents in 2008 would be $122.6 billion, driven by the fact that insured people tend to use more health care services than the uninsured. Health care spending accounted for 16.3% of gross domestic product in 2007, or about $2.2 trillion, and this portion could almost double in 10 years, according to federal data.

Free access to the study, prepared for the Kaiser Family Foundation's Commission on Medicaid and the Uninsured, is available http://content.healthaffairs.org/cgi/content/full/hlthaff.27.5.w399/DC1.

Just Between You and Me: Over $120 BILLION in indirect costs associated with the uninsured and even that enormous number, in my opinion, does not tell the true story of the uninsured and underinsured in America. As President Bush said a year ago, in vetoing the S-CHIP expansion, “Every American has access to health care; all they have to do is going to the hospital emergency room!” Yeah right, but who pays for it, Mr. President? Every American is forced to pay this bill – an indirect, but very real tax on each of us, insured or not. It’s time to quit fooling around and get serious about health care for every American.

*************************************

Jeanne's Lawyer Joke of the Week

Three health lawyers and three hospital accountants got on the train in New York to go to a convention in DC. The three accountants bought a ticket each, but the three lawyers bought only one ticket between them. The accountants commented on the illegality of their action but the lawyers said, "Trust us -- we're lawyers."

When the conductor entered the end of the car to collect the tickets, the three lawyers got up and all went into the bathroom together. When the conductor knocked on the bathroom door, a hand shot out with the one ticket, which the conductor duly canceled.

On returning to their seats the three accountants expressed admiration for such a clever trick. "Well," they said modestly, "we ARE lawyers."

After the convention they all entered Union Station for the return trip home to New York. This time the accountants bought one ticket between them, while the lawyers did not buy any tickets at all. The accountants were amazed and said so. "Trust us," the three said. "We're lawyers."

When the conductor arrived, the three accountants quickly jumped up and went into the bathroom. As soon as the door closed, the three lawyers got up and headed for the adjoining bathroom. As the last lawyer went by the accountant's bathroom, he knocked on the door. A hand shot out with the ticket, which the lawyer quickly grabbed before entering the other bathroom.

*************************************

(3)

FORTY PERCENT OF WORKING ADULTS ARE HAVING TROUBLE PAYING FOR THEIR HEALTH CARE

More than 40% of working age adults in the U.S. had difficulty paying medical bills or accumulated medical debt last year, compared with about 33% in 2005, according to a new Commonwealth Fund study. For the study, researchers analyzed data from the Commonwealth Fund Biennial Health Insurance Survey, conducted in 2001, 2003, 2005 and 2007. The survey found that about two-thirds of U.S. adults between ages 19 and 64 were uninsured, underinsured, reported a problem with a medical bill or did not get care due to high costs in 2007.

The study also found:

·         39% of U.S. residents with growing medical bills used their savings;

·         30% incurred credit card debt;

·         29% said medical bills left them unable to pay for basic necessities such as food, heat or rent; 28% of working age adults had no insurance at some time during the previous year, up from 24% in 2001;

·         61% of people with difficulty paying medical bills or debt were insured at the time they received the treatment;

·         14% of adults in 2007 were insured but without adequate insurance, compared with 9% in 2003; and among people with annual incomes below $20,000, 53% spent more than 10% of their income on health care, compared with 26% of this group in 2005.

The study also found that half of U.S. adults with incomes less than $20,000 were uninsured at some time last year, compared with 41% of those with annual incomes between $20,000 and $40,000 and 18% of those with incomes between $40,000 and $60,000.

The study is available http://www.commonwealthfund.org/publications/publications_show.htm?doc_id=700872. 

A Commonwealth Fund issue brief on medical debt also is available http://www.commonwealthfund.org/publications/publications_show.htm?doc_id=700868.

*************************************

What's the quickest way to a lawyer's heart?

… Through the ribcage.

*************************************

(4)

CM² MISLED CONGRESS ABOUT ITS MEDICARE DME FRAUD DETECTION SUCCESSES AND A BIPARTISAN CONGRESS IS REALLY PISSED

DHHS Inspector General Daniel Levinson on Monday released a federal audit that found that Medicare officials underestimated the amount of incorrect payments for durable medical equipment in 2006 and that the miscalculation was caused by the agency's failure to have auditors follow CM²'s policy for checking claims. The DHHS audit reviewed a sample of 363 Medicare DME claims to determine whether auditing contractor AdvanceMed had found all improper payments. CM² had estimated a payment error rate of 7.5%, or about $700 million in improper payments. The DHHS audit found an "error rate" of nearly 29% for the sample of DME claims. The report cited 20 payment errors identified by the Medicare audit and 73 errors the contractor had not identified.

The report faults Medicare officials for allowing AdvanceMed to conduct the review without fully documenting claims from suppliers. According to the audit, more incorrect payments would have been identified if Medicare had told the contractor to follow the agency's written policy. Levinson in a cover letter for the report wrote,

Levinson also wrote that Medicare auditors should check a wider range of records related to claims, including physician records and other medical documents verifying the necessity of equipment. He also recommended requiring contractors to contact beneficiaries who allegedly receive devices considered to be at high risk for improper payments, such as motorized wheelchairs, and check to see if the devices were received and if they were medically necessary.

CM² CFO Timothy Hill said the agency implemented a requirement last year that more documentation be provided for wheelchairs. A top Medicare official said there was no written policy requiring auditors to use medical records to count error rates in 2006. AdvanceMed spokesperson Chuck Taylor said the firm was prohibited by its contract from commenting on the issue without Medicare approval.

The report is available http://www.oig.hhs.gov/oas/reports/region1/10700508.htm.

CM² Braggadocio and Angry Congresscritters: Senatecritter Chuck Grassley (R-Iowa), ranking member of the Senate Finance Committee, said, "I want to know what happened, who's responsible, who will be held accountable and what [DHHS Secretary Mike Leavitt] will do about it." He added, "If people cooked the books, manipulated the methodology or told the contractor to ignore the rules, those individuals need to take the heat." Housecritter Ileana Ros-Lehtinen (R-Fla.) said the House Committee on Oversight and Government Reform would hold hearings on the issue this fall. Housecritter Mario Diaz-Balart (R-Miami) said, "If this is true, this is an outrageous and unforgivable stunt. Cracking down on fraud should be a top priority for Medicare, not fixing numbers to make an agency look better." He added, "I expect hearings and I expect answers -- truthful answers -- from Medicare about this report."

Just Between You and Me: In an editorial, the Miami Herald said what many Congresscritters, and just plain Americans are feeling: "The amount of fraud and corruption in Medicare is simply mind-boggling" and "exceeded only by a staggering lack of oversight by Congress and by Medicare's own failure to protect the program against open thievery… If the DHHS Inspector General's claims of Medicare "'cooking the books' ... proves true, heads should roll at [CMS]." The Wall Street Journal in its editorial tried to pin the blame on “government-run” health care: “We're speechless. Mr. Stark and his ilk consistently claim that Medicare is a model for government-run "universal" health care because it spends less on overhead than the private sector. True, Medicare's administrative costs are just 3% of total spending, while the private sector hits 11% to 14%. But insurance companies spend money to screen their claims for fraud. Medicare automatically pays more than 95% of the bills it receives. This lack of scrutiny reduces overhead, but it makes the program highly vulnerable to abuse.” One problem in the WSJ’s hubris, it failed to note that the then GOP-controlled Congress cut funding for Medicare auditing in 2003 and the early successes of the 1996 HIPAA anti-fraud provisions have been greatly undermined. And even so, it has been a GOP-run CM² that has failed to keep up with the early promise of health care fraud and abuse reform, not Pete Stark and his “ilk.”

*************************************

What do you say when you see a lawyer about to be hit by a truck?

 “_________________________.”

*************************************

HIPAA, NOW AND FOREVER:

HEALTH CARE I.T. STUFF

  (5)

KENNEDY-ENZI BIPARTISAN ELECTRONIC HEALTH RECORD BILL DELAYED UNTIL AFTER POLITICAL CONVENTIONS

Additional action on a bill (S 1693) that would create a national electronic health records system has been delayed until after the political conventions. The bill jointly sponsored by Senate Health, Education, Labor and Pensions Committee ranking Senatecritter Mike Enzi (R-Wyo.) and committee Chaircritter Ted Kennedy would greatly expand the government’s role in building an electronic health care record, most importantly through federal funding of the effort to the tune of $100 million or more. Enzi and Kennedy had hoped to advance the measure to the floor by unanimous consent before the Congressional recess but Oklahoma GOP Senatecritter Tom Coburn put a hold on the bill and has effectively tied the matter up. Coburn objects to the authorization of more than $100 million annually toward grant and loan initiatives to encourage adoption of health information technology. He recommended revisions to the bill that would force hospitals, at their expense, to provide physicians with health I.T. equipment at a discount or at no cost.

Just Between You and Me:  The U.S. needs a national health information network that respects patient confidentiality but that also lets hospitals share records across states quickly, seamlessly and accurately. A national legal framework to create such a network is required, but current legal barriers to such a network's formation include a patchwork of state and federal patient-privacy laws, flaws in federal physician anti-kickback and anti-self-referral statutes, prohibitions against practicing medicine across state lines, and concerns about medical malpractice in an electronic health care environment. Lawmakers rave about the need for affordable health care, but too little is done in the area of eHealth and instead of taking the initiative and forcing the issue top down, they are implicitly hoping for a bottom-up solution while taking partisan stances in the periodic debates over medical-malpractice liability. Establishing a national health I.T. network is one area where the federal government could act and needs to act, but will Congress and the next administration have the vision and political courage to make a bold move that could save countless lives and reduce health care costs? The nation needs revolution, not evolution, in health care informatics.

*************************************

What’s the best thing to get for a lawyer who has been hospitalized?

… Dr. Kevorkian!

*************************************

 (6)

MEDICAL PRIVACY LANGUAGE REVISED

House Energy and Commerce Committee Chaircritter John Dingell (D-Mich.) and ranking membercritter Joe Barton (R-Texas) have released a revised version of a bill (HR 6357) that aims to promote nationwide adoption of an electronic health record system. The lawmakers substantially changed the information-sharing and privacy provisions of an earlier proposal following concerns from stakeholders in the health care, high-tech and consumer advocacy arenas. Under the revised bill, patients would give their consent only once to health care companies that want to access health care records without identifying information for DHHS-approved purposes, such as hospital audits or fraud and abuse allegations. The bill previously would have required patient consent each time the records were accessed, According to the revised bill, the patient consent provision would be implemented two years after the bill is enacted, and DHHS would be required to develop "reasonable and workable" rules to implement the provision.

The original version of the bill also would have required health care providers to notify patients of any unauthorized acquisition, access or disclosure of their health care information. The revised version states that a "good faith" disclosure, such as a mislabeled letter with a wrong address, would not be considered a breach.

Other revised provisions in the bill would:

·         Prohibit the sale of patients' records without consent unless it is necessary for treatment or to receive payment for treatment;

·         Change existing federal privacy laws to allow for the provision of a no-cost digital copy of an individual's medical record;

·         Strengthen language to ban direct and indirect payments to providers who advertise health care products to patients without permission; and

·         Require the DHHS Office of Civil Rights to launch a formal investigation of complaints and allow the office to impose fines for violations deemed "willful neglect."

*************************************

Why don't lawyer's worry about the wages of sin?

They charge "professional fees", not "wages".

*************************************

 (7)

HIPAA COMPLAINTS: LESS THAN 2% HAVE BEEN ACTED UPON

A DHHS office has resolved more than half of complaints about possible violations of the medical privacy rule issued after the passage of the Health Insurance Portability and Accountability Act without investigation. Since the rule took effect in 2003, 38,000 U.S. residents have filed complaints with the DHHS Office for Civil Rights, and the office has resolved 56% of those complaints without investigation, the review found. The review also found that OCR has referred only 437 complaints, less than 2% of the total, to federal prosecutors.

Just Between You and Me: One of the main problems with enforcement of the rule is that health care providers do not have to report internal violations. This is a tremendous loophole. Enforcement is left to the health care community to sort of self-police itself, and to the Office of Civil Rights, which has done virtually nothing.

*************************************

DO YOU KNOW WHAT'S REALLY BAD ABOUT HELL?

Having so many lawyers around!

*************************************

ELECTION 2008

 (8)

BARACK vs JOHN:  Viva L’Difference!

In the face of escalating costs, uneven quality of care, and the growth of the uninsured population, there is broad agreement that the U.S. health care system requires reform. However, Democrats and Republicans remain sharply divided over how to reform it, as evidenced by the health care plans offered by the parties' presidential candidates. The ambitious reform agendas of Senatecritters John McCain and Barack Obama would take the U.S. health care system in very different directions.

John McCain: McCain's plan embraces market forces and promotes individually purchased insurance. Its centerpiece is a change in the tax treatment of health insurance. Currently, workers do not pay taxes on health insurance premiums paid by their employers. The McCain plan would eliminate this tax exclusion and use the revenue generated -- projected to be $3.6 trillion over 10 years -- to pay for refundable tax credits for Americans obtaining private insurance ($2,500 for individuals, $5,000 for families). Uninsured Americans could use their credits to help buy insurance coverage on the individual market, and workers with employer-sponsored insurance could use theirs to offset the cost of paying taxes on their employers' premium contributions or to purchase coverage on their own. The McCain campaign emphasizes key advantages of this approach. First, the current tax exclusion disproportionately benefits higher-income Americans, since its value depends on a worker's tax bracket. Providing an equal credit to all Americans is a fairer allocation of federal revenues, and since the credit is refundable, even those who do not pay taxes would qualify for federal payments. Second, the tax exclusion benefits only persons with employer-sponsored insurance, whereas under the McCain plan everyone, including the unemployed and workers whose employers do not offer coverage, would receive a credit to purchase insurance regardless of where they obtained it.

In terms of cost control, the McCain plan offers several initiatives aimed at spurring competition and changing the status quo in health insurance and medical practice. It would deregulate the private insurance market to allow insurers to sell policies across state lines; residents of states that extensively regulate insurance (for example, by mandating covered benefits) would be able to shop nationwide for less comprehensive, less costly health insurance policies than those available in their home states.  McCain's plan also calls for changing the way Medicare pays for medical services -- moving away from fee-for-service reimbursement and toward bundled payment for episodes of care and payments based on outcomes. The hope is that Medicare payment reform would drive broader changes in the health care system.

In addition, replacing the invisible, unlimited tax exclusion with a visible, limited tax credit could slow health care spending. Making employer premium payments taxable income would make insurance costs more transparent to workers, many of whom are unaware how much their employers are paying for their insurance. And since Americans would receive a fixed credit, the expectation is that they would seek out lower-cost, less comprehensive insurance plans, fostering competition among insurers. Other cost-control provisions include speeding up generic-drug development, encouraging prevention, improving care for chronic diseases, and adopting medical malpractice reform.

Problems with the McCain Plan: How the McCain plan would affect costs and coverage is uncertain. Nobody knows how effective repealing the tax exclusion would be in controlling costs, but if it turns out not to be a magic bullet, the plan lacks other mechanisms for reliably slowing spending. Prevention, better care for chronic conditions, and enhanced competition represent aspirations rather than concrete policies for controlling costs.  In addition, most uninsured Americans would probably remain uninsured under the McCain plan. Given the high price of health insurance, even with the new tax credits, many lower-income people would still not be able to afford coverage. And if the credits are not indexed to the rate of growth in health care spending, that affordability gap would grow over time. Not mentioned much by McCain is the fact that Americans, who would continue to have employer-funded health insurance, would now be paying taxes on that value. Indeed, even with the proposed credits, many if not most Americans could afford only high-deductible insurance policies, increasing the problem of “underinsurance” and the impact of serious illness or accident. The McCain plan could consequently trigger a move from comprehensive insurance toward thinner coverage policies that shift costs onto sicker patients. Moreover, some employers, particularly smaller businesses, might stop offering insurance if the tax benefits of employer-sponsored insurance were eliminated. As a result, some currently insured workers could lose coverage.

Perhaps the most serious problem with McCain's plan is its reliance on the individual insurance market. Individual insurance policies are administratively expensive, typically involve medical underwriting so that sick persons and those with preexisting conditions are charged higher premiums (premiums also increase with age) or are denied coverage altogether, and generally offer less comprehensive benefits than employer-sponsored insurance. The McCain campaign has proposed a "guaranteed access plan," whereby the federal government would work with states to create insurance alternatives for those unable to afford coverage on the individual market. The plan builds on the experiences of the 34 states that operate high-risk pools for residents who are deemed to be medically uninsurable. Yet such a program is unlikely to remedy problems inherent in the individual market. State high-risk pools ironically suffer from the same problems (high costs, limited benefits, preexisting-condition exclusions) that plague the insurance markets from which they are supposed to offer refuge. Furthermore, the McCain plan for interstate insurance markets could weaken regulatory protections in some states. Fraudulent insurance is already a very significant problem and crossing state lines would virtually assure a lack of consistent enforcement without a major federal investment in policing the plans being offered.

Barack Obama: In contrast to John McCain's emphasis on markets and deregulation, Barack Obama's reform plan relies on an employer mandate, new public and private insurance programs, and insurance-market regulation. The core of the Obama plan is a requirement that employers either offer their workers insurance or pay a tax to help finance coverage for the uninsured (some small businesses would be exempt, and others would be subsidized). The Obama plan would also create two new options for obtaining health insurance: a new government health plan (similar to Medicare) and a national health insurance exchange (a purchasing pool analogous to the Massachusetts Connector) that would offer a choice of private insurance options. Both would be open to persons without access to group health insurance or other public insurance, as well as to small businesses that wanted to purchase coverage for their workers. Income-related subsidies would be provided to help lower-income persons afford coverage. And private insurers could not deny coverage because of preexisting conditions or charge substantially higher premiums to sick enrollees: the Obama plan would end medical underwriting according to health status.

 
The Obama campaign emphasizes that its plan offers a choice of insurance options. Rather than deciding whether public or private insurance is a better model, the plan would allow people to choose between them. In addition, the new national health plan and insurance exchange would provide insurance pooling and purchasing power that, along with insurance-market regulation, would effectively address the problems that Americans without group coverage encounter when trying to purchase affordable insurance on the individual market. The Obama campaign says that the insurance exchange, by providing broader pooling and cutting marketing expenses, can reduce administrative expenses in private insurance and promote competition. The plan also calls for a new system of reinsurance, whereby the federal government would reimburse employers for a portion of the costs they incur for employees with high-cost, catastrophic medical cases — theoretically enabling businesses to reduce insurance premiums and particularly benefiting smaller businesses whose risk pools are too small to spread the costs of expensive cases.

Other cost-control measures include accelerated adoption of electronic medical records, promoting disease management and better coordination of long-term care, paying providers on the basis of performance and outcomes, strengthening prevention, permitting the federal government to negotiate prescription-drug prices for Medicare patients, cutting excessive payments to private health plans contracting with Medicare (the 12-19% in “bonus” payments currently being paid to private Medicare Advantage plans), and establishing an institute for comparative-effectiveness research to generate information about effective treatments.

Problems with the Obama Plan: The Obama plan's precise impact on coverage is impossible to gauge. If the payroll tax is set low, many businesses would choose to pay it rather than offer coverage, and enrollment in a new national health plan could be substantial. The capacity of the Obama plan to expand insurance coverage depends on the scope of subsidies, premium prices, and the effectiveness of automatic enrollment or other participation-boosting policies, but details of those policies are not clear. Since the plan lacks an individual mandate for adults (coverage is mandated for children), it would not cover all the uninsured and therefore would provide universal access to insurance rather than universal coverage. However, most Americans without insurance would gain coverage through the new public and private insurance options, and Obama has not ruled out adopting an individual mandate in the future if the plan does not produce universal coverage.

Although the Obama plan would substantially expand access to insurance, it lacks reliable cost-control mechanisms and a viable financing source. Reinsurance would shift private-sector costs for catastrophic cases to the government but would not reduce total health care expenditures. The plan also assumes that substantial savings will be achieved by increasing the use of electronic medical records, improving the management of chronic conditions, and strengthening prevention, but none of these worthwhile measures is likely to control costs in the short run. The new national health plan could control costs, but its effectiveness in slowing spending would depend on its enrollment and the political willingness to restrain provider payments.

The Obama campaign says it would finance the $50 billion to $65 billion in new federal spending for its health plan by allowing tax cuts adopted in 2001 and 2003 for families making over $250,000 to expire. However, the Congressional Budget Office (CBO) already assumes in its projections that these tax cuts will end after 2010, so their expiration will not generate new revenues to satisfy congressional budget rules. And if savings from prevention, disease management, and electronic medical records are not realized -- or if the CBO does not validate them as an acceptable financing source -- then the Obama plan would need substantial additional revenues to fund expanded coverage.

Summary: The McCain and Obama health plans are best viewed as sketches rather than finished portraits, with many important details yet to be revealed. Still, the 2008 presidential election clearly offers voters dramatically different alternatives. The candidates' opposing visions of health care reform reflect fundamentally different assumptions about the virtues and vices of markets and government. With the debate over how to reform U.S. health care far from settled, whoever wins the presidency can expect fierce opposition to any attempt at comprehensive reform. And that opposition may come in many instances from within the candidate’s own party.

********************************************

Why don't lawyers play hide-and-seek?

Nobody will look for them.

********************************************

THE PHARMACY CORNER

 (9)

MEDICARE PRESCRIPTION DRUG “DOUGHNUT HOLE” SMACKED OVER 3 MILLION BENEFICIARIES UP BOTH SIDES OF THEIR HEAD IN 2007

In 2007, about 3.4 million Medicare beneficiaries reached the so-called "doughnut hole," or gap in Medicare prescription drug coverage, during which time they were responsible for their medication costs, according to a Kaiser Family Foundation study. In 2007, the coverage gap occurred when total drug spending for an individual reaches $2,400 for a single year and continues until total out-of-pocket spending reaches $3,850 in that year. Researchers from the Kaiser Family Foundation, Georgetown University and NORC at the University of Chicago analyzed pharmacy claims data provided by IMS Health. The analysis excludes beneficiaries who receive low-income subsidies because they do not face a gap in coverage under their Medicare drug plan.

According to the study, one out of four Medicare beneficiaries enrolled in the Part D drug benefit, or 26%, who filled any prescriptions in 2007 reached the coverage gap, 22% of which stayed in the gap for the remainder of the year. Only 4% ultimately received catastrophic coverage. Applying this estimate to the entire population of beneficiaries enrolled in the drug benefit, the analysis suggests that about 3.4 million beneficiaries (14% of all drug benefit enrollees) reached the coverage gap and faced the full cost of their prescriptions in 2007.

Beneficiaries who take medications for serious chronic conditions were much more likely to reach the coverage gap. For example, 64% of beneficiaries taking medications for Alzheimer's disease, 51% of those taking oral anti-diabetic medications and 45% of patients on antidepressants reached the coverage gap in 2007. Across eight classes of drugs examined -- used to treat a variety of relatively common chronic conditions -- about 15% of the beneficiaries who reached the coverage gap in 2007 stopped taking their medications, according to the study. The report also found that 5% of those reaching the gap switched to a different drug, most often a generic, while 1% reduced the number of medications of a certain class they were taking. The study found that 10% of drug benefit enrollees taking oral anti-diabetic drugs who reached the coverage gap stopped taking their medications. Among drug benefit enrollees taking a drug for osteoporosis who reached the gap, 18% stopped taking medications. And, 20% of those taking Proton Pump Inhibitors (for ulcers and acid reflux) who ended up in the gap discontinued their medications.  According to the study, beneficiaries who reached the coverage gap but did not receive catastrophic coverage on average spent $196 monthly while in the doughnut hole, compared with $104 monthly prior to reaching the coverage gap. In addition, beneficiaries who reached the coverage gap paid the full cost of their medications for just over four months on average and received catastrophic coverage for less than one month on average.

The study is available http://www.kff.org/medicare/7811.cfm.

********************************************

What do you get when you cross a blonde and a lawyer?

Hey! There's some things even a blonde won't do.

********************************************

theJeanneScottletter

 (4)

 (6)

 (7)

 (9)

 (10)

HEALTH CARE REFORM UPDATE

Update #412

May 19, 2008

Copyright:  Jeanne Scott Matthews, 2008

HIGHLIGHTS IN THIS ISSUE

HEADLINE NEWS

1. Battling Budgets: The Democratic Counter Budget - No Cuts in Medicare and Medicaid

2. Physician Medicare Reimbursement Cuts: Now Up to 10.6% and Scheduled for 7/1/ 2008

3. GAO, CRS: Bush Administration Didn’t Limit S-CHIP In the Right Way

4. Employers Passing More and More Health Insurance Costs on to Employees

5. Bush Administration Reneges on Transparency: All Power to the AMA

HIPAA: NOW AND FOREVER

6. Senators Agree on Privacy Rule Changes

7. Obituary: Jerome H. Grossman

8. AMA Agrees on Standards for E-Prescribing

UNIVERSAL HEALTH CARE

9. Handy-Dandy Pocket-Size Summary of the Candidate Positions

THE PHARMACY CORNER

10. Direct-to-Consumer Advertising Comes Under Attack

***

Editor:  Jeanne Schulte Scott

(480) 983-5586

jeanne.scott@health-politics.com

Quotes of the Week

***

"Our budget moves to balance by 2012 with balanced priorities… It rejects, for example, the huge cuts proposed in Medicare and Medicaid by the president and congressional Republicans."

-- House Budget Committee Chaircritter John Spratt (D-S.C.) describing the Democratic FY 2009 budget they expect to pass this week as opposed to President Bush’s earlier budget plan. [See, Report #1, below]

***

"If they pass it, it will be a major accomplishment that we weren't able to achieve when we were in the majority…  But the proof is in the pudding as to whether this blueprint will be implemented. The chances are not very good."

-- G. William Hoagland, who served as a senior budget aide to former Senate Majority Leader Bill Frist (R-Tenn.), commenting on the Democrats budget effort.  [Report #1, below]

***

"There are lots of different options on the table. Just don't know yet."

-- Senate Finance Committee Chaircritter Max Baucus (D-Mont, on alternatives that might be used to offset the costs of giving physicians back the scheduled 10.6% cut in their Medicare reimbursement. [See, Report #2, below]

***

"The August 17 directive would impose strict new requirements on states and beneficiaries that are not only impossible to achieve but make little, if any, sense."  

-- House Energy and Commerce Health Subcommittee Chaircritter Frank Pallone (D-N.J.) on hearings that he hopes will lead to reversing a Bush administration rule limiting the expansion of state S-CHIP programs.  [See, Report #3, below]

***

 “This is the second consecutive year employees' share of spending will increase by double digits.… [The report] is likely to increase pressure on the next presidential administration to address health care costs."

-- Lorraine Mayne, co-author of a new study that reports that employers will continue to shift health care insurance costs to their employees, 10.5% in 2008. [See, Report #4, below]

***

"The study adds to the existing gloom and doom related to medical costs as projections by federal analysts show that health spending in the United States will double by 2017."  

-- From a CQ HealthBeat editorial comment on the new study. [Report #4, below]

***

“I know the government was under a lot of pressure from the AMA in particular, arguing that the government should appeal. Whether that's the reason the government appealed, I don't know."  

-- Robert Krughoff, president of Consumers' CHECKBOOK, suggesting that DHHS decision to appeal a court decision ordering the public release of Medicare physician payment information was perhaps the result of AMA lobbying. [See, Report #5, below]

**********************

HEADLINE NEWS

 (1)

DUELING BUDGETS: CONGRESSIONAL DEMOCRATS REACH AGREEMENT ON $3.3T BUDGET BLUEPRINT FOR FY 2009 THAT DOES NOT INCLUDE GOP PROPOSED CUTS TO MEDICARE, MEDICAID

 

Congressional Democrats last week announced that they have reached a tentative agreement on a $3.3 trillion fiscal year 2009 budget resolution that rejects reductions in spending for Medicare and Medicaid proposed by President Bush. Bush has estimated that his legislative proposals over five years would reduce spending for Medicare by $178 billion and spending for Medicaid by $17 billion. According to Senate Budget Committee Chaircritter Kent Conrad (D-N.D.), the agreement also would provide about $20 billion more for military and domestic programs than the $991.6 billion requested by Bush. House Budget Committee Chaircritter John Spratt (D-S.C.) declined to disclose additional details about the agreement.

The House and Senate might approve the budget as early as this week, Conrad said. Spratt said that lawmakers should be able to pass the budget resolution before Congress goes home for Memorial Day. If it is approved, it will mark the first time since 2000 that Congress has been able to agree on a budget blueprint in an election year.

Just Between You and Me: The budget blueprint is a nonbinding resolution that sets targets for separate spending bills that are normally approved later in the year and sent to the president. This year, however, Democratic leaders have said they are likely to avoid sending most spending bills to Bush, who has again threatened to veto measures that exceed his requests. What they are trying to do is create campaign issues for the fall. Among the Democratic actions:

Medicare and Medicaid: Rejects Bush’s 6-year proposed $178 billion and $17 billion cuts in Medicare and Medicaid. Most of Bush’s Medicare cuts had been directed at hospitals, nursing homes and home health agencies.

Tax Changes: Extends the tax cuts that target the middle class, including a child tax credit, a reduction in the penalty for married couples and adds a new lower 10 percent tax bracket, but sunsets the Bush administration’s higher income tax (above $250,000) cuts starting in 2010.

Alternative Minimum Tax: Revises the AMT formula which would have imp acted as many as 20 million more middle income Americans in 2009 but leaves open the issue of counterbalancing the $70 billion in revenues lost by changing the formula until after the 2998 elections.

New Spending: The Dems budget comes in at $20 billion more in domestic spending than President Bush’s but says it will result in a balanced budget by 2012, three years earlier than Bush says his budget will achieve, through the sunset of higher income tax cuts.

*************************************

Legal Quote of the Week

-- Isabella Whitney, A Sweet Nosegay or Pleasant Posye
Containing a Hundred and Ten Phylosophicall Flowers, 1573

*************************************

(2)

MEDICARE PHYSICIAN PAYMENT CUTS, WHAT TO DO, WHAT TO DO?

SENATE FINANCE COMMITTEE DISCUSSES OFFSETS FOR ESTIMATED $15M TO $18M COST OF GIVINBG DOCS BACK THEIR MEDICARE PAY; BUSH ADMINISTRATION REQUESTS JUNE 16 DEADLINE

 

Senate Finance Committee Chaircritter Max Baucus (D-Mont.) said a Medicare package that would delay for 18 months a 10.6% cut to physician fees would cost between $15 billion and $18 billion over five years, prompting committee members to begin discussions on how to offset those costs. Senatecritters Olympia Snowe (R-Maine) and Kent Conrad (D-N.D.) said that committee members continue to examine reducing payments to private insurers that administer Medicare Advantage plans as a potential offset for the bill. MA plans, on average, are paid an estimated 113% of what traditional Medicare pays per patient. Last year, when Congress passed a six-month delay for the Medicare fee cuts, Republicans objected to cuts to the MA program.

House Ways and Means Health Subcommittee Chaircritter Pete Stark (D-Calif.) said he expects Baucus to cut indirect medical education payments under MA that are given to insurers that provide coverage in areas with teaching hospitals. Baucus said no decisions were made on Wednesday, but he did not rule out cutting IME payments.

June 16 Deadline: The Bush administration has asked Congress to approve legislation delaying the fee cuts (which are scheduled to take effect on July 1) by June 16 to avoid delays in payments that would result in additional administrative costs. CM² estimated that passing legislation by June 16 would help reduce the possibility of disrupted payments or reprocessed claims that would result in extra administrative costs.

Just Between You and Me: Baucus and Senate Majority Leadercritter Harry Reid (D-Nev.) have pledged floor time for discussion of the legislation in early June. Baucus said that he would "try" to meet the June 16 deadline but would "certainly" be finished by the end of the month.  However, House members are nervous regarding the Senate's timing. "The concern here is if the Senate acts so late and sends us a bill in late June and expects us to rubber-stamp it, they're in for a rude awakening," Housecritter Shelley Berkley (D-Nev.) said. Congress could go beyond the deadline, but some doctors have vowed to see fewer Medicare beneficiaries if payments are reduced, and a disruption in payments could have a similar effect. And no Democrat wants to take the blame for that in an election year.

*************************************

Jeanne's Lawyer Joke of the Week

The impressionable new associate at the big city law firm was talking to three senior associates about their preferred marital status.

The estate planning associate extolled the virtues of married life.  “You have a lot more secure home life,” he said; “you can start your family now and have someone to discuss the ups and downs with . . . ”

The litigation associate explained how he preferred to play the field.  “I like the thrill of the chase, getting to know someone new . . . ”

The tax associate discussed his preference,  “You really need a wife and a mistress.  That way, when your wife calls and asks where you are, you can tell her you're with the other woman.  When the mistress calls, tell her you're at home with your wife.  In the meantime you can spend all of your time at the office billing hours.”

*************************************

(3)

GAO, CONGRESSIONAL RESEARCH SERVICE SAYS BUSH ADMINISTRATION IMPROPERLY ISSUED DIRECTIVE THAT LIMITS STATES' ABILITIES TO EXPAND S-CHIP

According to testimony delivered by the Government Accountability Office and the Congressional Research Service during a House Energy and Commerce Health Subcommittee this past week, the Bush administration improperly issued a policy directive last year that restricts states' abilities to expand their S-CHIP programs, hearing. The August 17, 2007, policy directive requires states to enroll 95% of children in families with incomes up to 200% of the federal poverty level before expanding coverage to children in families with incomes greater than 250% of the poverty level. During the hearing, the GAO and CRS spokespersons said the Bush directive amounted to a regulation and should have been vetted in Congress using the same process as other administrative rules.

The opinions from GAO and CRS lend weight to Democrats' efforts to nullify the directive, something they have promised to do since it was issued. Subcommittee Chaircritter Frank Pallone (D-N.J.) is sponsoring legislation (HR 5998) that would reverse the directive.

States have argued that meeting the enrollment requirement is impossible, and several states have filed lawsuits against the federal government to block the directive. The Bush administration says the directive is aimed at preventing families from dropping private health coverage to enroll in S-CHIP.

Just Between You and Me: While a bill reversing the Bush administration’s S-CHIP policy could possibly pass the House, too many Republicans support the principle behind the directive, so Pallone's bill stands little chance of passage in the Senate, where it would be filibustered.
But there is an option if the Democratic Congressional leadership really wants to do something.  A “disapproval resolution” probably could still be passed by Congress to nullify the directive. Unlike stand-alone bills, disapproval resolutions cannot be filibustered in the Senate. But nyah, they don’t have the will.

The GAO opinion is available online, http://www.gao.gov/docsearch/abstract.php?rptno=GAO-08-785T

*************************************

A judge in a semi-small city was hearing a drunk-driving case and the defendant, who had both a record and a reputation for driving under the influence, demanded a jury trial.  It was nearly 4 p.m. and getting a jury would take time, so the judge called a recess and went out in the hall looking to impanel anyone available for jury duty.  He found a dozen lawyers in the main lobby and told them that they were a jury. The lawyers thought this would be a novel experience and so followed the judge back to the courtroom.  The trial was over in about 10 minutes and it was very clear that the defendant was guilty.  The jury went into the jury-room, the judge started getting ready to go home, and everyone waited.  After nearly three hours, the judge was totally out of patience and sent the bailiff into the jury-room to see what was holding up the verdict. When the bailiff returned, the judge said, "Well have they got a verdict yet?" The bailiff shook his head and said, "Verdict?  Hell, they're still doing nominating speeches for the foreman's position!"

*************************************

(4)

EMPLOYEE OUT-OF-POCKET COSTS FOR FAMILY HEALTH CARE TO INCREASE 10.5% IN 2008, Says Milliman

The cost of health care for the average U.S. family with employer-sponsored health coverage will increase 7.6% this year, due in part to rising prescription drug prices, according to a Milliman study. The fifth annual Milliman Medical Index analyzed historical claims data and trends in provider contracting and examined the drivers and components of medical spending. According to the study, the cost of medical services, including premiums, will increase by $1,109, from $14,500 in 2007 to $15,609 in 2008 for an average family of four enrolled in an employer-sponsored PPO.

The study also found that the cost of pharmacy services is expected to increase by 10.6% to $2,302, compared with single-digit increases for physician services, inpatient and outpatient care. Drug spending has slowed the past two years, according to the study. However, this year's increase is a trend that Milliman believes will continue.

According to the study, employers are expected to pass on more of the cost to their employees. Employers will shift around 10.5% more of the cost to workers through higher premiums and out-of-pocket costs, such as deductibles, copayments and coinsurance, the study found. Of the total $15,609 cost, employers will pay $9,442, while employees will spend $3,492 on premiums and $2,675 in out-of-pocket costs. In 2008, employers will pay roughly 60% of medical costs, while employees will pay 40%.

*************************************

Two of the top partners of a top Houston personal-injury law firm were wooing a hot, young, Ivy League, law school graduate, whom they wanted to recruit very badly.

The firm flew him down, gave him the grand tour, showed him the fabulous suite he'd have, as well as the car and other perks. The grad took all this in, was duly impressed, and told the two partners, "This is all very impressive, and quite generous, but before I could commit to you I have to know one thing: what kind of pro bono program does the firm have?"

The two partners looked at each other, back at the grad, and asked for a minute to confer. In the corner of the conference room, they huddled briefly, then seemed to come to a consensus.  They walked back over to the young graduate; whereupon the older, very distinguished partner said, "What's pro bono?"

*************************************

(5)

SO MUCH FOR TRANSPARENCY: DHHS APPEALS COURT ORDER TO RELEASE PHYSICIAN DATA

DHHS has appealed to the U.S. Court of Appeals for the District of Columbia from an August 2007 court decision that requires the department to release Medicare claims data on more than 40 million beneficiaries and 700,000 physicians. In August 2007, the U.S. District Court for the District of Columbia ruled that DHHS must release Medicare physician claims data for Illinois, Maryland, Virginia, Washington state and Washington, D.C. In the case, Consumers' CHECKBOOK/Center for the Study of Services filed a lawsuit to obtain access to the data. DHHS argued that the release of the data would violate the privacy of physicians. However, the court rejected that argument because Medicare claims account for only a portion of the incomes of physicians. According to the court, the release of the data would "help the public make more informed Medicare decisions" and provide "more information of how government funds are spent."

Consumers' CHECKBOOK plans to post the data online for public use. Researchers could analyze the data to determine the number of times physicians perform certain procedures and to compare the mortality rates among patients of certain physicians, and health insurers could use the data to improve their analyses of physician quality.

Consumer groups, employers and health insurers support the decision, and physician groups oppose the decision. The American Medical Association, which has petitioned to join the DHHS appeal, maintains that the data could be misleading because they do not take into account differences in patients treated by different doctors.

Just Between You and Me: In filing this appeal, the Bush administration and GOP candidate John McCain find themselves caught on their own petard. On the one hand, transparency for both price and quality has been until now, a cornerstone of the Republican drive to privatize health care, especially Medicare. DHHS Secretary Leavitt has given literally dozens of speeches calling for more not less health care transparency. Indeed, without greater pricing and quality transparency, the Bush administration’s call for greater consumer control over its proposed high-deductible health savings accounts, and John McCain’s call promise to move the nation away from employment-based health insurance to individually controlled coverage, would be an exercise in futility. How can the consumer make the choices such a system would impose on them when they don’t know the prices they will be charged, have no idea about the quality of the services they are buying, and have no basis to make a comparison or a reasonable choice regarding their care?

The DHHS appeal is further evidence of the enormous power of the Medical industry’s lobby. The AMA and many affiliate medical specialist societies and state and local medical groups have long balked at making their prices public. They have been absolutely adamant in their opposition to quality reporting. Bush and his people have buckled. Trailing the Democrats by more than two- to-one in fund-raising, the GOP feels that it cannot afford to alienate the deep-pocketed medical lobby. Thus transparency goes out the window. Who says money doesn’t talk?

*************************************

The hypochondriac lawyer was convinced he was near death, finally dragging himself to yet another physician, he pleaded with the doctor: 

“Give it me straight, doc, how many more billable hours do I have left?”

*************************************

HIPAA, NOW AND FOREVER:

HEALTH CARE I.T. STUFF

(6)

SENATE LEADERS AGREE ON PRIVACY PROTECTIONS AMENDMENT TO HEALTH CARE INFORMATION TECHNOLOGY BILL

 

Senate Judiciary Committee Chaircritter Patrick Leahy (D-Vt.) last week announced that sponsors of a bill (HR 1693) that would promote the use of health care information technology have agreed to include an amendment Leahy proposed to help protect patient privacy. Senate Health, Education, Labor and Pensions Committee Chaircritter Ted Kennedy (D-Mass.) and ranking membercritter Mike Enzi (R-Wyo.) introduced the legislation last October. Leahy had raised concerns that the bill, which would extend the medical privacy rule issued after the passage of the Health Insurance Portability and Accountability Act to electronic medical records, did not include adequate privacy protections. The rule allows some health care providers to distribute medical records for marketing purposes.

Under the amendment, providers could not distribute medical records for marketing purposes, and patients would have the right to request electronic copies of their records. The amendment also would require DHHS to develop recommendations for Congress on privacy and security and establish a patient notification system in the event of a breach of their medical records.

Just Between You and Me: Senatecritter Leahy plans to hold a hearing in June on the privacy protections in the legislation. After nearly eight years of virtual silence on the health care privacy issue, the matter is heating up once again. We’re seeing some progress in this draft legislation buy it is far from a done deal. The Bush administration has requested some technical revisions to the bill, and the Congressional Budget Office has not determined a cost estimate for the amendment. All of this could spell doomsday for anything this year.

*************************************

A man goes into a pet shop to buy a parrot. The shop owner points to three identical-looking parrots on a perch and says, "The parrot on the left costs $500."
"Why does the parrot cost so much?" asks the customer.
The owner says "Well, the parrot knows how to do legal research."
The customer then asks about the next parrot, to be told that this one costs $1,000 because it can do everything the other parrot can do plus it knows how to write a brief that will win any case.
Naturally, the increasingly startled customer asks about the third parrot, to be told that it costs $4,000. Needless to say, this begs the question, "What can it do?"
To which the owner replies, "To be honest, I've never seen him do a darn thing, but the other two call him 'Senior Partner.'"

*************************************

 (7)

OBITUARY: JEROME H. GROSSMAN, FOUNDING FATHER OF HEALTH INFORMATION TECHNOLOGY

Dr. Jerome H. Grossman, a health care analyst at Harvard and leading hospital administrator who was influential in applying engineering solutions to make medical care more efficient, died in April at his home in Boston. He was 68. The cause was renal cell carcinoma, his family said.

Trained as an internist, Dr. Grossman saw a need early in his career for more accurate, complete and portable medical histories. In the late 1960s, relying on the emerging technology of computers, he and others at Massachusetts General Hospital advocated an “automated” records system that could be easily tapped by everyone involved in a patient’s treatment. The result, with Dr. Grossman’s input, was an electronic records system that appeared in the 1970s and was used successfully by the Harvard Community Health Plan.

Jerome Harvey Grossman was born in Newark, N.J. He graduated from the Massachusetts Institute of Technology before earning a medical degree in 1965 from the University of Pennsylvania.

*************************************

“What's the difference between a vulture and a lawyer?

. . . The vulture doesn't take its wing tips off at night.”

*************************************

(8)

AMA OUTLINES PROVISIONS PHYSICIANS WOULD ACCEPT IN ELECTRONIC PRESCRIBING LEGISLATION

 

The American Medical Association has released a set of standards that physicians would accept for any electronic prescribing requirement under Medicare. The AMA is considered the largest barrier to enacting e-prescribing legislation because of the group's concerns over the cost of adopting and implementing the technology. Some consumer, labor, insurer and business groups have said that the Medicare package that the Senate Finance Committee is drafting should include language to require physicians participating in Medicare to e-prescribe. In addition, separate legislation (S 2408, HR 4296) would require e-prescribing in Medicare and would offer payment incentives to encourage e-prescribing adoption.

AMA officials announced the proposal at a forum sponsored by the Brookings Institution's Engelberg Center for Health Care Reform.  Steven Stack, an AMA board member and emergency physician, called on lawmakers to ensure that CM² releases a final rule for e-prescribing standards by the end of 2009. The agency last month issued three standards and intends to release three more. Stack also said that physicians should be permitted at least two years to implement e-prescribing technology before they are subject to Medicare payment reductions. Lawmakers also should allow exceptions for physicians with small practices, rural physician offices and emergency cases. AMA also called for the removal of a Drug Enforcement Administration rule that would prohibit e-prescribing of controlled substances.

 

Forum participants also raised concerns about evolving medical practice patterns and e-prescribing technology, as well as patient privacy issues such as data collection and sales.
Deborah Peel, founder and chair of Patient Privacy Rights, said that lawmakers should consider strict penalties on data mining by insurers, pharmacies and marketers without patient consent. However, Steve Findlay, managing editor of Consumer Reports Best Buy Drugs, said that the opportunity for abuse of patient data is "relatively small."

John Rother, group executive officer for policy and strategy at AARP, said an AARP survey found that 92% of people ages 65 and older wanted their physicians to e-prescribe. He said that e-prescribing is "convenient," "safer" and alerts patients and their doctors to lower-priced generic medications, possible drug interactions and whether a medication is covered by insurance.

*************************************

“What's the difference between a vulture and a lawyer?

. . . The vulture doesn't get frequent flyer miles!”

*************************************

UNIVERSAL HEALTH CARE, v. 2008

UNIVERSAL HEALTH CARE IS “THE” DOMESTIC POLICY ISSUE FOR 2008:

CANDIDATES FALLING OVER ONE ANOTHER IN PROPOSING SOLUTIONS

 (9)

CAMPAIGN STERATEGIES AND…

THE DIFFERENCES BETWEEN THE PARTIES AND CANDIDATES

Will There Even Be a Debate? The sharply contrasting health care visions of the Democratic and Republican presidential candidates offer the promise of a grand campaign debate – but only if the candidates feel it is an issue that will resonate with the voters. And that is a big issue with rising gas prices, the changing Iraq War, and the slipping economy overwhelming health care as an issue. McCain has criticized the Clinton and Obama health care proposals as "big-government" plans that will reduce choices for consumers, and the Democratic candidates have said that the McCain proposal would reduce incentives for employers to offer health insurance.  There are Grand Canyon-like differences on health care between the two parties, but it's an open question whether it will be a hot issue in the campaign.

What are the Differences? Clinton and Obama have proposed to expand public health insurance programs to provide coverage to more U.S. residents, and McCain has proposed incentives for individuals and families to purchase private coverage. The Democratic candidates consider lack of health insurance the main problem with the health care system, and McCain considers cost the main problem. The Democrats are emphasizing that people need employers and government to create large pools so that they can get group rates for much less than as individuals, and McCain emphasizes a vision where individuals get more choices in the marketplace and are less reliant on employers and government.

How Do We Resolve the Pending Insolvency of Social Security, Medicare and Medicaid Programs? None of the three White House contenders has offered a comprehensive solution to the expected fraying of the safety net of Medicare and Social Security as the U.S. population ages, but each has suggested some intriguing fixes that, while differing in the details, all seek to alleviate the entitlement problem by stimulating individual savings. McCain would replace the tax exemption for employer-provided health care with tax credits for those purchasing their own insurance. Both Obama and Clinton have likewise proposed refundable tax credits as a way to help people buy health insurance but want the employer to stay in the game. Concerns about the financial solvency of Medicare as baby boomers reach retirement age are very real and have to be addressed.

Must There Be an Individual Health Insurance Mandate? A mandate that all residents obtain health insurance, the one major difference in the Clinton and Obama health care proposals, has received more attention than it deserves. Clinton supports such a mandate, but Obama would require only that children have health insurance. Economists generally favor the Clinton proposal because the plan could make the health care system more efficient, but health care analysts say the Clinton campaign has falsely suggested the Obama plan would exclude people who wanted to sign up for health insurance. Health care policy experts praise both candidates for an unusually substantive primary campaign, as both have come forward with detailed plans to address the decline of company-provided health insurance and other issues. McCain rejects any mandate, none on individuals and absolutely none on employers.

Do Democrats Advocate a Single-Payer System? McCain has indicated that the Clinton and Obama health care proposals would establish a single-payer or nationalized health care system similar to those in Canada and Britain, but that suggestion is absolutely incorrect. Neither Democrat has proposed a single-payer system, as Canada has, or a nationalized system, as Britain has, and both would expand public health insurance programs but allow residents to retain employer-sponsored coverage, with subsidies provided to those who qualify to help cover the cost of premiums. The criticism from McCain is the latest example of the use of such language to characterize health care proposals. McCain tries to appeal to a general antigovernment feeling ... a value that may or may not relate to the policies being discussed by either candidate. McCain spokesperson Tucker Bounds said that, although the Clinton and Obama proposals do not "outline" such a single-payer or nationalized system to the "finite extent, they clearly suggest that the movement toward a single-payer system is in their overall interests.”

What About Private Individual Insurance? Herein lay one of those Grand Canyon differences. Hillary and Barack would require private insurers to take all comers regardless of pre-existing conditions and at affordable prices.  Clinton would almost immediately slap down the private insurance industry for its poor performance in reviewing and rejecting claims often months after services had been provided. She proposes severe limits on the marketing of private insurance. Obama is also unhappy with private insurance industry but he suggests a bit more patience and would establish a “monitoring system” to keep watch. If the private insurance industry doesn’t clean up his act, he would move in to slap it down. McCain thinks an unfettered free market will weed out the bad players in the private insurance industry. For patients with pre-existing conditions who might otherwise be priced out of the market, he proposes high-risk pooling and other mechanisms.

Feel better now?

********************************************

“Why won't vultures eat dead lawyers?”

. . . There are some things that would gag even a vulture.

********************************************

THE PHARMACY CORNER

 (10)

D-T-C ADVERTISING UNDER THE CONGRESSIONAL LENS

During a recent hearing of the House Energy and Commerce Committee Oversight Subcommittee, executives from Johnson & Johnson, Pfizer and a joint-venture between Merck and Schering-Plough defended television prescription drug advertisements that lawmakers have claimed potentially misled consumers. Democratic members of Congress to date have been unsuccessful in passing legislation that would prohibit direct-to-consumer ads in the first three years after a drug is approved. They have intensified their scrutiny of the drug industry, energized by a recent discovery that Merck and Schering-Plough continued to advertise the cholesterol drug Vytorin after a study showed it is no more effective than a lower-cost generic drug. Lawmakers are expected to propose similar legislation later this year.

The panel is focusing on three discontinued advertising campaigns that were "designed to deceive and mislead" consumers, Subcommittee Chaircritter Bart Stupak (D-Mich.) said. Stupak and House Energy and Commerce Committee Chaircritter John Dingell (D-Mich.) asked Schering-Plough Vice President Deepak Khanna why the company continued to air ads for Vytorin after the study was completed in January 2006. Results were not released until January 2008. Stupak said, "Many consumers may not have taken Vytorin had they been aware of the study results." In response, Khanna said, "I saw a vigorous debate over the quality of that data," adding that the company "took steps to make sure the data was there and meaningfully analyzed before its release."

Lawmakers questioned J&J representatives about ads for the drug Procrit, manufactured by J&J subsidiary Ortho Biotech, which promoted the drug as a treatment for "cancer fatigue" that would improve the "quality of life" for patients, the Star-Ledger reports. FDA had not issued approval for such a use. Stupak said, "This was clearly an instance of off-label marketing practice that is prohibited by FDA." Ortho Biotech President Kim Taylor said, "Statements in the advertisements regarding the benefits of Procrit were true, responsible and substantiated by scientific studies."

The panel also looked at Pfizer's ads for the cholesterol drug Lipitor, which featured Robert Jarvik, inventor of the first artificial heart, as a spokesperson, despite Jarvik not having a license to practice medicine. Democrats on the panel said Jarvik is not qualified to give medical advice, even though he went to medical school. James Sage, a Pfizer marketing executive, said Pfizer and Jarvik are "confident that the statements included in the ads fairly represent the scientific data about Lipitor."

Dingell requested that the drug company executives adopt new standards for marketing, but all three said they did not have the power to do so. Dingell said, "Maybe we need to have another hearing with someone who can really speak on behalf of the companies," adding, "Perhaps the company presidents would be able to respond in a more helpful fashion."

Other Testimony

 

Nancy Nielsen, president-elect of the American Medical Association, said D-T-C drug ads are "neither balanced nor educational." Ruth Day, a researcher at Duke University, noted that consumers rarely have a complete understanding of the risk warnings included in ads. Government Accountability Office representative Marcia Crosse testified that FDA does a poor job of overseeing the growing number of DTC drug ads.

********************************************

You might be a lawyer if:

You are charging someone for reading these jokes.

The shortest sentence you have ever written was more than eighty words long.

You have a daughter named Sue and a son named Bill.

Your other car is a BMW.

When you look in a mirror, you see a lawyer.

When your husband says "I love you," you cross-examine him.

********************************************

back to top

theJeanneScottletter