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Tag: cost of healthcare

The Cost And Quality Of Cancer Care

The April issue of Health Affairs contains a cluster of papers focusing on the cost and quality of cancer care. Other subjects covered in the issue: health care payment reform; the diminished number of uninsured young adults; and regulatory approval of new drugs by the FDA.

Publication of the cancer studies in the April issue was supported by Precision Health Economics and the Celgene Corporation.

Does Increased Spending On Breast Cancer Treatment Result In Improved Outcomes?

Aaron Feinstein of Yale University School of Medicine’s Cancer Outcomes, Public Policy, and Effectiveness Research Center and coauthors compared care costs and survival rates among women ages 67–94 diagnosed with stage II or III breast cancer during two time periods, 1994–96 and 2004–06. They found that over the course of a decade, median cancer-related costs increased from $12,335 to $17,396 among women with stage II disease, and their five-year survival rate improved from 67.8 to 72.5 percent.

For those women with stage III disease, costs increased from $18,107 to $32,598 with an accompanying five-year survival improvement from 38.5 to 51.9 percent. The cost increase was largely attributable to a substantial increase in the cost of chemotherapy and radiation therapy.

The authors note that the price society is willing to pay for an additional year of life remains controversial in the United States and suggest that more research is needed to determine how to best contain costs while continuing to advance patient care.

Read the full article here.

Contact Steven G. Cosby, MHSA with questions or to request more information and to schedule a healthcare plan evaluation, savings analysis or group plan solution for your company.

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Implementing Health Reform: Wraparound Benefits Final Rule; Coverage Report (Revised)

Employer coverage would not wrap around MSP SHOP coverage but rather around individual MSP coverage. Under prior guidance the employer would still not be able to pay for the primary individual MSP coverage, but would only pay for the wraparound benefits.

The employer could offer some categories of employees comprehensive coverage and other categories of employees only wrap coverage, as long as coverage offers did not discriminate on the basis of preexisting conditions or health status or in favor of highly compensated employees. Alternatively, the employer might offer all emloyees the option of either comprehensive coverage or wrap coverage, in which case employees who opted for wrap coverage would not qualify for premium tax credits unless employer coverage was in fact inadequate or unaffordable.

Employers would in any event be required to continue to make a total aggregate contribution toward primary and wrap coverage for all employees that was “substantially the same” as the amount contributed for coverage of all full-time employees for plan years that began in 2013 and 2014. The employer could be liable for the employer mandate penalty if the employer failed to offer adequate and affordable coverage to some employees that resulted in those employees receiving premium tax credits through the marketplace.

With open enrollment closed for 2015 and the Departments having finalized the Benefit and Payment Parameters Rule and Letter to Issuers for 2016, we have entered the Spring Affordable Care Act regulatory doldrums. Reports, minor regulations, guidances, and court decisions continue to appear, however. Two appeared on March 16. This post addresses the final wraparound coverage excepted benefits rule, and a report on health insurance coverage and the ACA (technical appendix here), both released on March 16, 2015.

The wraparound coverage rule creates a new category of excepted benefits. The concept of excepted benefits was created by the Health Insurance Portability and Accountability Act of 1996 and is carried forward in the ACA. Excepted benefits plans provide benefits that resemble in some way the health benefits that have been regulated by HIPAA and are now regulated by the ACA, but are more limited or are more tangential to medical care. These include benefits that are not generally medical benefits but do afford some medical coverage (auto liability, workers’ compensation); health coverage that is not medical coverage (dental, vision, long-term care); benefits that are not coordinated with medical benefits (specific disease coverage, fixed dollar indemnity coverage); and coverage that is supplemental to medical coverage (such as Medicare supplement policies). Additional specific conditions must be met for some of these benefits to qualify as excepted benefits.

Excepted benefits are generally not subject to Affordable Care Act requirements, such as the ban on dollar coverage limits or preexisting conditions clauses. But excepted benefit coverage explicitly does not qualify as minimum essential coverage. An individual who has only excepted benefit coverage and does not qualify for a shared responsibility requirement exception must still pay the individual mandate penalty. Large employers that offer only excepted benefits may have to pay the employer responsibility penalty, but individuals offered only excepted benefits by their employers are not disqualified from receiving premium tax credits to purchase individual coverage through the marketplaces.

The list of excepted benefits has been fairly stable since the HIPAA rules were published in 2004. The agencies are authorized to recognize new types of excepted benefits or change existing excepted benefits, however, and the ACA has prompted them to do so. In December of 2013, the agencies published a proposed rule to change the requirements for vision benefits linked with self-insured plans and to recognize employee assistance programs and “wraparound” benefits as excepted benefits under certain circumstances. Rules on vision coverage and employee assistance programs were finalized by the agencies in October, 2014, but the wraparound coverage rule proved much more controversial and the agencies decided to hold the proposal for further consideration.

On December 23, 2014 the agencies published a second proposed rule (discussed here) proposing a pilot program of a more limited wraparound coverage benefit. The basic idea of wraparound coverage is reasonably straightforward. Some employers offer generous benefit packages to their employees. However, they often do not offer these benefits to part-time employees or retirees, who may be eligible for less generous benefits through the marketplaces. Moreover, employer coverage may be more generous than marketplace coverage.

Under the new rule, employers may offer part-time and retired employees wraparound coverage that wraps around and increases the benefits covered through primary “qualifying individual coverage.” This includes any individual coverage that is not grandfathered or transitional coverage or another form of excepted benefits. Specifically, the final rule clarifies that qualifying individual coverage includes coverage under the Basic Health Plan Program. Employers may also supplement marketplace coverage that they offer through the Multi-State Plan (MSP) program to their full-time employees.

Read the full article here.

Contact Steven G. Cosby, MHSA with questions or to request more information and to schedule a healthcare plan evaluation, savings analysis or group plan solution for your company.

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400 Percent Cost Difference to Treat Prostate Disease

UCLA researchers have for the first time described cost across an entire care process for a common condition called benign prostate hyperplasia (BPH) using time-driven activity-based costing. They found a 400 percent cost difference between the least and most expensive ways to treat the condition.

The finding takes on even further importance as there isn’t any proven difference in outcomes between the lower and higher cost treatments, said study first author Dr. Alan Kaplan, a resident physician in the UCLA Department of Urology.

“The rising cost of health care is unsustainable, and a big part of the problem is that health systems, health care providers and policy makers have a poor understanding of how much health care really costs,” Kaplan said. “Until this is well understood, taxpayers, insurers and patients alike will continue to bear the burden of soaring health care costs.”

From the study itself: “Although listed as ‘optional’ in practice guidelines, invasive diagnostic testing can increase costs by 150% compared with the standalone urology clinic visit. Of five different surgical options, a 400% cost discrepancy exists between the most and least expensive treatments.

Read the full article here.

Contact Steven G. Cosby, MHSA with questions or to request more information and to schedule a healthcare plan evaluation, savings analysis or group plan solution for your company.

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Health Insurance and Your Taxes

If you purchased health insurance coverage, you’re already enjoying the peace of mind that comes with knowing you’re covered if you or a family member gets sick. This year, you also can enjoy a second benefit: knowing that you will not be required to pay a penalty to the government when you file your taxes.
But what if you only had coverage for part of the year, or received financial assistance from the government to help lower the cost of your monthly payments? Here are eight things you need to know about health insurance and your taxes.

1. What is the individual mandate and how does it affect my taxes?

The individual “mandate” (also known as the individual shared responsibility provision) requires everyone who can afford health insurance to purchase coverage or pay a tax penalty. If you can afford coverage but choose not to purchase it, the penalty will apply unless you qualify for a health coverage exemption. The amount of the penalty for failing to have coverage varies.

2. What if I only had coverage for part of the year in 2014?

According to the Centers for Medicare & Medicaid Services, you are not required to pay a penalty if you had healthcare coverage for more than nine months in 2014 or are eligible for an exemption. If you previously received an exemption or want to apply for one when filing your taxes, you will need to complete Form 8965.

3. How do I know if I qualify for a health coverage exemption?

Most people who can afford health insurance but choose not to purchase coverage will be required to pay the penalty. However, there are a variety of reasons someone might be eligible for an exemption, including hardship, living abroad or having an income below the level that requires you to file a tax return. You can find more information about exemptions here.

Read the full article here.

Contact Steven G. Cosby, MHSA with questions or to request more information and to schedule a healthcare plan evaluation, savings analysis or group plan solution for your company.

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Concerns About Cancer Centers Under Health Law

Some of America’s best cancer hospitals are off-limits to many of the people now signing up for coverage under the nation’s new health care program.

Doctors and administrators say they’re concerned. So are some state insurance regulators.

An Associated Press survey found examples coast to coast. Seattle Cancer Care Alliance is excluded by five out of eight insurers in Washington’s insurance exchange. MD Anderson Cancer Center says it’s in less than half of the plans in the Houston area. Memorial Sloan-Kettering is included by two of nine insurers in New York City and has out-of-network agreements with two more.

In all, only four of 19 nationally recognized comprehensive cancer centers that responded to AP’s survey said patients have access through all the insurance companies in their states’ exchanges.

Not too long ago insurance companies would have been vying to offer access to renowned cancer centers, said Dan Mendelson, CEO of the market research firm Avalere Health. Now the focus is on costs.

“This is a marked deterioration of access to the premier cancer centers for people who are signing up for these plans,” Mendelson said.

Those patients may not be able get the most advanced treatment, including clinical trials of new medications.

And there’s another problem: it’s not easy for consumers shopping online in the new insurance markets to tell if top-level institutions are included in a plan. That takes additional digging by the people applying.

“The challenges of this are going to become evident … as cancer cases start to arrive,” said Norman Hubbard, executive vice president of Seattle Cancer Care Alliance.

Before President Barack Obama’s health care law, a cancer diagnosis could make you uninsurable. Now, insurers can’t turn away people with health problems or charge them more. Lifetime dollar limits on policies, once a financial trap-door for cancer patients, are also banned.

The new obstacles are more subtle.

To keep premiums low, insurers have designed narrow networks of hospitals and doctors. The government-subsidized private plans on the exchanges typically offer less choice than Medicare or employer plans.

By not including a top cancer center an insurer can cut costs. It may also shield itself from risk, delivering an implicit message to cancer survivors or people with a strong family history of the disease that they should look elsewhere.

Read the full article here.

Contact Steven G. Cosby, MHSA with questions or to request more information and to schedule a healthcare plan evaluation, savings analysis or group plan solution for your company.

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