Senin, 04 Juni 2012

FSA's meet ObamneyCare©

From email:

"On May 30, 2012, the Internal Revenue Service (IRS) issued a Notice on the new $2500 Limit on Health Care Flexible Spending Accounts (FSAs). The Notice clarifies that this provision of [ObamneyCare©] applies to plans beginning after December 31, 2012 ...

The limit applies on an employee-by-employee basis rather than per household"

Currently, folks can contribute up to $5,000 per household to the health care portion of their Flex Account. Beginning next year, that gets slashed in half (unless one's spouse also has access to an FSA through his/her employer).

Just another ObamneyCare© tax increase.

[Hat Tip: Cigna]

Minggu, 03 Juni 2012

O, What Fresh Hell is this? Part II


I believe this is still the most recent IRS guidance on taxability of MLR rebates.  The answer is “yes” and “no”.  (What did you expect?  This guidance is from IRS.)

The guidance is in the form of FAQ's - there are 15 of them.  The first one discusses the tax impact on insurance companies that make rebates.  The remaining 14 describe the tax impact on insured persons who receive rebates.  In summary, the Answers to the 14 Questions about individual insured persons are:

2.   NO
3.   YES
4.   YES
5.   NO
6.   NO
7.   YES
8.   NO
9.   NO
10. YES
11. YES
12. YES
13. YES
14. YES

If you are still awake, that’s 8 “yes” answers and 5 “no” answers.

Are we clear?

Fun fun fun boys and girls.

Sabtu, 02 Juni 2012

Outside of the box generic solutions

Rx shortages have now become the norm:
At the Henry Ford Hospital in Detroit, pharmacists are using old-fashioned paper spreadsheets to track their stock of drugs in short supply - a task that takes several hours each day.
Self funded employers should come together and partner with Wal Mart or a mail order facility and form a non-profit, US-based generic pharmaceutical company. This way they can guarantee themselves an affordable supply of generic medications. With a guaranteed market they could have consistent supply runs.

Once that is established then they can aggressively start challenging patents. Instead of the current games of exclusive 6 month periods at inflated prices and years in court with BS legal arguments once a patent expires, they file to make the drug; if the brand manufacturer challenges,  then they all exclude the drug from coverage.

Jumat, 01 Juni 2012

What Fresh Hell is this?

As Mark Twain once said, "Life is just one damned thing after another."

The May 31, 2012 Wall Street Journal contained this tiny article buried on Page B6 that said (subscription required):

“CVS Caremark Corp.'s pharmacy-benefit business is prepared to escalate a campaign against drug-industry coupons that the company says encourage unnecessary use of expensive brand-name drugs.”

CVS Caremark has an obvious interest in promoting generics because of its enormous mail order business, in which dispensing generic drugs is quite profitable.

Oh the other hand, manufacturers make more money from brand-name drugs. So naturally a battle is escalating. But there's more to the story.

The effect of manufacturer’s coupons is that people aren't required to pay the full retail price. The manufacturer is giving a price reduction to the coupon holder. Therefore insurers and self-funded plans could decide their benefit plans will only allow, or cover, the lower price - after the coupon is applied. This would reduce the benefit payable by the plan.

Example:

Say the plan has a brand drug copay of 50%, and say a brand prescription retails at $200. The manufacturer’s coupon is worth $100 (equal to the 50% copay). If manufacturers' advertising suggests their coupons mean prescriptions are “free” that's what people will expect. In this example, they will expect the coupon to pay half the cost, and their insurance to pay the other half. But wait. What if the insurer or self-funded plan says the price the member is required to pay, net of the coupon, is only $100? If that happens, the expense covered by the plan is $100 and insured person's copay is $50. Not zero. Not what people will expect.

That’s still a better deal than 50% of $200 .. . but people expecting to pay nothing won’t get that prescription for free.

Why might insurers and self-funded plans decide to do this? Simple - it reduces their cost - in the example, from $100 to $50. So is this what will happen? We'll soon see.

Fun fun fun boys and girls.

Game on.

Video Friday

Cato's Michael Cannon has been on a tear lately, advocating that states pro-actively shun setting up ObamneyCare© Exchanges. Here, he explains why:



If you've been following the Pioneer Institute's series on the latest MassCare Payment Reform train-wreck efforts, here's Part 3:

End of Life Care: A Conundrum

From email:

"Why Does End-of-Life Care Cost So Much?‏
$33,382 for one hospital stay. $43,711 for the next. And a final $14,022 for the last three days of life. This is the cost of dying in America ... sick people are paying hundreds of thousands of dollars for “comfort care” at the end of their lives. The expensive scans, tests, and treatments that dying patients receive often provide a false hope, and at the end of it, many are surprised to suddenly learn they will still die. The incentives are skewed ... the high cost of staying alive ... and why the notorious “death panels” may be just what patients need."

Having experienced this first-hand, I'm particularly sensitive to the issues involved here. But I'm not the only one: everyone here at IB has been touched by it in some way. So I've asked each of the co-bloggers for their reactions, and would very much appreciate yours, as well - either in the comments or by email:

Bob: The lady is spot on in her assessment.

Problem is, many of us will say it is time to let a loved one go but too often it turns out more like the movies . . . . "Spare no expense. I don't care what it takes, let him live"

Kelley: Back when I was a Social Worker, I worked in an Adolescent Rehab Hospital. My main case load was the diabetic kids, but the other section of the hospital were for children and adolescents who had had life altering injuries which left them as vegetables.

I had a nurse tell me that she would advise her ER nurses not to work so hard to "save" people from catastrophic injuries as the emotional toll and financial costs were simply too much to bear. I recall a brain injured teenager, male, whose only recourse was a nursing home as he was a vegetable, no brain activity. I agree with this woman: doctors are only paid for doing something, not for doing nothing.

Nate: What bothers me is that $33,382 hospital bill probably only cost the hospital $6000 to deliver care. It’s one thing to profit off death but 400% profit margins these people should be outcast of society not pillars of the community.

Mike: Death with dignity - and palliative care - is the idea behind hospice. Not a bad idea. Maybe we should be thinking how to expand the idea so more people can reach death with dignity.

Notice that in the article linked, the author reports that decisions about her father's end of life care were taken away from the family:

"[T]he doctor we had never met before admitted Terence to an advanced-cancer-care ward at the University of Pennsylvania Hospital. And then an entirely new set of doctors took over"

Doctors the family had never met before - strangers - making medical care decisions about her father, instead of her family. Exactly "taking over." Bennett laments that. IMO well she should.

Follow her thought thru another step. If one prefers not to have strangers making the decisions about medical treatment for you or your family members, how much more might one also prefer not to have strangers making the decisions about your or your family member's death ?

Here's an idea. Pick an age - say, 60. Starting at that age, it shall be illegal for anyone to have medical insurance - public or private, individual or group - regardless of ability to pay. And upon attaining that age, each citizen shall be granted a lifetime stipend of $200,000 to use in any manner whatsoever, but with a strong suggestion that it be set aside for future medical care. Beyond that, for citizens above age 60, no more insurance, no more public subsidies of any kind, no welfare, nothing more for medical care.

Now, does that sound kindlier than "death panels?"

Bob: Sure Mike.

Of course you don't have to worry about getting re-elected. Those weenie's in DC can't even agree on making changes that won't impact anyone 55 or older. No way they would offer up your $200k You Bet Your Life plan.

You can make a similar argument for/against premature babies, those with significant birth defects including severe retardation, CP or any number of conditions.

I have known more than a handful of folks with children that are running up $50 - $100k/yr for "maintenance" and these kids will live for years. Poor quality of life, but alive none the less.

Kelley: And here's another thing. The author lumps all charges, hospital and providers into one number. Nate notes that the care would be a certain number, which may be true if the hospital did the care, but the care was done by each different provider, the radiologist reading the cat scans, the PT providing physical therapy, the Hospitalist providing care and diagnoses, so as to be paid, etc. The only providers that cannot bill are the nurses provided by the hospital for care; the hospital bills a facility fee to cover those costs and nurses are very expensive. If you were to take the overhead expenses of all the providers, taking out the hospital-only costs, you will probably find a much more narrow margin, such that the costs are justifiable.

The point is that once you enter the hospital for a terminal condition, all the staff can do is test, not cure, so one must decide if more tests stating the obvious is worth the cost. As the author pointed out, the last hospitalizations resulted in no treatment, only tests and confirmation diagnoses.

Hank: As previously noted, I'm a big fan of Hospice. BUT: Hospice is a choice - not a requirement. So when will HHS Secretary Shecantbeserious announce a "Hospice Mandate?"

There's no question that EOL care needs to somehow be reined in.

My issue is with the idea of an unelected, unaccountable panel of gummint-appointed bureauweenies making that decision.

Mike: Hank, that's exactly my beef as well.

Bill: Is there a solution to the EOL financial problem? As long as some belief systems preach the sanctity of life at any cost, some people will continue to spend other people’s money indefinitely. A healthy body, a dead mind and an irrational hope…those are the cases that become insanely expensive.

Behind the testing, there’s always another question, “Is it really terminal?”

Sometimes, you just don’t know. I had a relative who had an episode of ventricular fibrillation. According to his doctor, less than one out of twenty VFib patients make it to the hospital alive. Of those, a very small percentage survive without substantial neurological damage. He had virtually none. Five years and a pacemaker later, he’s still alive and practicing law. (There’s a bad joke in there somewhere!) With an initial Glasgow score of 6 (aka TFU), would an “efficient” system have spent the $150K to keep him alive? I doubt it.

[Hat Tip: Joyce Tang]

Taking a Mulligan on Obamacare

Obamacare, the red-haired stepchild of the president's administration, is now being considered for a do-over. In a meeting with potential donors, Obama is making a bid for a second term by making a pledge to revisit his signature legislation which has been all but ignored since signing it in to law.             
On April 3, Obama professed “enormous confidence” the law is constitutional and “the court is going to exercise its jurisprudence carefully,” in response to a question at the Associated Press’s annual meeting. A day earlier, he said the Supreme Court would have to take “an unprecedented, extraordinary step” to throw out “a law that was passed by a strong majority” in Congress.
Yet a planning memo, including a reminder that it’s important “to continue projecting confidence that the court will uphold the law,” was discussed at a May 29 meeting hosted by a group called Protect Your Care, attended by officials from the White House and Department of Health and Human Services, said one of the attendees, who requested anonymity to discuss a private meeting.
I have always found it odd that someone who taught Constitutional law as a college professor would not only trample on the Constitution repeatedly, but then publicly chide SCOTUS in a State of the Union address but also make veiled threats against the Court should they decide to overturn part, or all, of Obamacare.
As he previewed his agenda for donors at a May 14 fundraiser, Obama said he may be forced to try to revise parts of his health-care plan, depending on how the court rules later this month, said one activist, who requested anonymity to discuss the president’s comments.
If the Court rules against part or all of Obamacare, the re-election campaign may include a pledge to fix Obamacare.
Sounds like a quarterback asking the coach to send him back in in spite of throwing nothing but interceptions.