New York’s Bellevue Hospital performs thousands of the lucrative surgeries a year, even on Rikers Island prisoners and other inappropriate patients.
Tag: Hospitals
Readers Slam Hospital Monopolies and Blame the Feds for Understaffed Nursing Homes
Letters to the Editor is a periodic feature. We welcome all comments and will publish a selection. We edit for length and clarity and require full names.
Why Hospital Monopolies Are a Bad Idea
I recently read the article about Ballad Health by Brett Kelman and Samantha Liss regarding the Mountain States Health Alliance and Wellmont Health System merging to create Ballad Health, upon state approval (“These Appalachia Hospitals Made Big Promises to Gain a Monopoly. They’re Failing to Deliver,” Sept. 29). Well, it was approved, and here is another reason that monopolies are a bad idea. My husband is a teacher in Tennessee, and it complicated our open enrollment selections for 2024 insurance. We have used BlueCross BlueShield of Tennessee, a widely selected insurer in our state. We were sent notification that Ballad Health and BCBST were in negotiations and that there was a high probability that Ballad will soon be an out-of-network provider for those with BCBST plans. Luckily, the school district offers Cigna insurance as well, but not all providers accept that insurance (as I said, BCBST is a huge insurer in this area).
Please explain to me how it is OK for a monopoly to decide not to be in-network with any health plans. They should be required to be in-network with any insurer from this area. I find this very upsetting. I shouldn’t have to worry that if a catastrophic event were to happen that my insurance coverage would be reduced to 60%-40% from 80%-20%, all because my only option for emergency care (Ballad) chose not to negotiate with the largest insurance provider in my area. Just food for thought.
— Kimberly Ensor, Johnson City, Tennessee
On X, formerly known as Twitter, a user whose tagline is “a one-woman wrecking ball” had this to say about nursing home worker shortages:
— Ashley Thomas, Cleveland, Ohio
The Crisis of Understaffed Nursing Homes
I wanted to thank you for providing a platform for discussion of nursing home staffing (“Exclusive: CMS Study Sabotages Efforts to Bolster Nursing Home Staffing, Advocates Say,” Aug. 29). As a nursing student entering my final semester at SUNY Downstate, I have seen firsthand the destitute conditions of understaffed nursing homes. Staffing ratios are abysmal and, as I see it, the only solution for the well-being of nursing home residents is a responsible staff-to-resident ratio.
I wholeheartedly agreed with the sentiment of the article: The Abt Associates study was a shameful attempt to undermine the movement toward standardized staffing ratios at nursing homes. People become residents at nursing homes for many reasons, but the fact is they are there, above all, because they need specialized care, which these homes need nurses to provide — services such as ventilator care, tube feedings, medication, continuous monitoring, and frequent interventions to prevent pressure injuries, and so much more. There is something terribly wrong when nursing homes cannot provide the services that define them, especially when families and residents depend on them to do so.
I do think there were some missed opportunities in the article. For example, Jordan Rau writes that “immobile residents are not repositioned in bed, causing bedsores that can lead to infection.” While this statement is true, it is rather vague. Infections are a life-threatening risk associated with pressure injuries, but the sores themselves are grotesque and painful, a point I think should have been included to emphasize the injustice of allowing pressure injuries to develop and worsen. Health care workers should make every effort to prevent them. And nurses should understand their roles as advocates in being a voice for patients who are unable to speak for themselves.
It’s easy for the public to imagine the residents of nursing homes as homogenous and stereotypical elderly people who have been forgotten as they became burdensome, which is not only false, but actively harmful and agist. People of all ages and backgrounds live in nursing homes, and their needs are as diverse as they are themselves. The only universal commonality they have is that they live in nursing homes and need respect, dignity, care, and an adequate number of nurses and staff to protect these needs.
— Tara L. Clark, Freeport, New York
A union activist who supports a national single-payer health system also weighed in on X:
— Kay Tillow, Louisville, Kentucky
Avoiding Financial Ruin for Aging Elders
As Jordan Rau and Reed Abelson identify (“Facing Financial Ruin as Costs Soar for Elder Care,” Nov. 14), too many of today’s older adults are falling through the cracks. They may struggle with daily activities and declining health but don’t necessarily need 24/7 nursing home care.
Within the patchwork of long-term care, the Program of All-Inclusive Care for the Elderly is underutilized. PACE offers integrated care through its campus-based model, where participants can receive comprehensive, coordinated medical care and social services in a combined Medical Clinic and Day Center, while also receiving at-home support with essential tasks like dressing, bathing, and eating.
This care is free to our dually eligible participants who are never saddled with copays, out-of-pocket costs, or deductibles. PACE has saved states thousands annually per participant. Further, participants are grateful to stay at home and remain engaged with family and friends.
PACE acts as a critical safety net for low-income seniors, so they and their families aren’t forced into financial ruin. For those not Medicaid-eligible, it costs less than the nursing home alternative.
To close our system’s gaps and lower spending, programs like PACE need to become a more prominent part of the discussion. Policymakers should expand access to PACE services so more people can benefit from this successful model of senior care.
— Richard Fish, CEO of One Senior Care, Erie, Pennsylvania
JoAnne Dyer echoed the dire warning about the draining cost of long-term care in an X post:
— JoAnne Dyer, Seattle
More Power to Suzanne Somers
Age 76 is pretty long to fight an aggressive, metastatic breast cancer without chemotherapy (“Suzanne Somers’ Legacy Tainted by Celebrity Medical Misinformation,” Oct. 18). I’d say Suzanne Somers proved her point! None of us lives forever. I got a lumpectomy in 2015 and refused tamoxifen. Chemotherapy wasn’t needed. I refuse mammograms and gynecology. I am doing well. I found Ms. Somers’ book on cancer, called “Knockout,” very informative. I didn’t buy into the supplements angle, but it empowered me in my own fight, when there were no answers, to ask questions and research. Quality of life is more important.
— Kerry McCracken, Milan, Illinois
A Las Vegas reader reacted on X to the same article published by the Los Angeles Times, one of KFF Health News’ media partners:
— Grant David Gillham, Las Vegas
Over-the-Counter Narcan a Big Leap for Humankind
Thank you for sharing your article highlighting barriers to accessing Narcan (“Narcan, Now Available Without a Prescription, Can Still Be Hard to Get,” Oct. 11). While some experts have questioned the significance of making Narcan available over the counter, I firmly believe this development is a major milestone in our ongoing battle against opioid-related fatalities.
One may argue that this change is merely a “tiny, tiny baby step” and not deserving of applause; however, I would contend that every positive change, no matter how small or late in the game, is a vital part of a larger solution. Making Narcan available without a prescription is a tangible acknowledgment of the urgency of the opioid crisis and a recognition of the need for swift, accessible interventions.
Narcan’s OTC status can help reduce the stigma surrounding opioid overdose and encourage open conversations about addiction and harm reduction. It sends a message that saving lives is a priority, and it encourages individuals to be prepared to act in emergencies.
Still, there are certainly challenges related to affordability of OTC Narcan. While $45 isn’t an ideal price tag, community groups, first responders, state and local governments, and harm reduction groups — many of whom may purchase Narcan in bulk — can buy Narcan for a cheaper price, $41 per two-dose carton.
It is also important to continue educating pharmacists on the use of Narcan. Only 19 states require that pharmacists complete a training course prior to dispensing naloxone in any capacity. All pharmacists, especially those located in areas with high rates of opioid deaths, need to be firmly equipped with the necessary information on administering Narcan to be a trusted source among the public. Provider education is a key steppingstone to improving access.
Narcan’s OTC availability represents a positive shift in our approach to combating opioid overdoses, and it is a step that deserves acknowledgment and support. Let us not underestimate the impact of this change and continue working toward a future where every person has access to the tools they need to prevent opioid-related fatalities.
— Sana Imam, master’s student at George Washington University, Washington, D.C.
The HIV Prevention Trials Network chimed in on X:
A ‘Hit Piece’ on Rival Hospital Systems
I recently read your article of a couple of years ago comparing for-profit versus nonprofit medical schools (“Montana Med School Clash Revives For-Profit Vs. Nonprofit Flap,” June 7, 2021). I am an anesthesiologist with 24 years of experience, and almost every health care institution or hospital has become for-profit. In fact, most anesthesiology groups are managed by corporations like NorthStar Anesthesia, U.S. Anesthesia Partners, etc. Hospitals have merged into gigantic multibillion-dollar corporations like Ascension, Universal Health Services, HCA Healthcare, and CHI Health.
So why is it so bad to have a for-profit medical school, exactly? Almost every aspect of modern health care has become for-profit, and those nonprofit institutions have colluded with larger systems to shut down smaller hospitals. So this clearly is a “hit piece” on the for-profit educational system by their competitor, Touro College and University System.
I am one of the few doctors truly trained in a nonprofit — called the U.S. Army, where I did my residency in anesthesiology at Brooke Army Medical Center. This is quite an uninformed and unreasonable article, especially given the state of the corporate health care industry that is pervasive in our country. When I left the military for private practice, I could not believe what was being passed for elective surgery outside the military.
So let’s not get the pot and kettle confused here. Calling out a for-profit medical school in an era dominated by large multibillion-dollar health care corporations is certainly the pot calling the kettle black. And the rural Montana area is just as much of a deserving area for any medical school — for-profit or nonprofit — as the rural state of West Virginia, where I practice.
— Lance R. Hoover, Morgantown, West Virginia
Medicare Cuts Harm Seniors’ Access to Physical Therapy Care
It’s disheartening to hear stories of physical therapists who are increasingly struggling to afford their training and cost of living while facing lower pay (“Back Pain? Bum Knee? Be Prepared to Wait for a Physical Therapist,” Nov. 28). No one should have to give up their dream of being a physical therapist because they worry the pay is unsustainable — especially at a time when many patients already have limited access to therapy care.
Unfortunately, that’s the reality for many — especially since the Centers for Medicare & Medicaid Services recently finalized yet another year of steep payment cuts to physical, occupational, and speech therapy in its recently released Medicare Physician Fee Schedule Final Rule for CY 2024.
CMS’ final rule includes a troubling pay cut of at least 3.4% to therapy providers in 2024. But in some geographic regions, that cut could be as high as over 4% because of the highly technical formula CMS uses to determine reimbursement. Not only will this cut weaken the pipeline of new physical therapists entering the field, but it will also put significant financial strain on physical therapists currently practicing, hurting retention, and potentially leading to practice closings, which all negatively impact patient access to physical therapy.
Physical therapy care is a critically important non-pharmacological treatment option for our nation’s aging population. It helps patients manage pain, improve mobility, and protect their independence, while avoiding reliance on powerful painkillers and preventing potentially deadly falls. It even saves CMS money: On average, Medicare spending for beneficiaries who receive physical therapy as the first treatment option is 75% lower than the total average spending for Medicare patients who undergo surgery first.
Though it’s disappointing that CMS did not listen to the patient and provider communities when finalizing yet more cuts, there’s still time for Congress to act. I urge our lawmakers on Capitol Hill to work together and swiftly reverse the serious cuts in the new rule to help stabilize our nation’s health care system and expand access to physical therapy care for patients.
— Nikesh Patel, executive director of the Alliance for Physical Therapy Quality and Innovation (APTQI), Washington, D.C.
California’s Ambitious Medicaid Experiment Gets Tripped Up in Implementation
SACRAMENTO, Calif. — Nearly two years into Gov. Gavin Newsom’s $12 billion experiment to transform California’s Medicaid program into a social services provider for the state’s most vulnerable residents, the institutions tasked with providing the new services aren’t effectively doing so, according to a survey released Tuesday.
As part of the ambitious five-year initiative, called CalAIM, the state is supposed to offer the sickest and costliest patients a personal care manager and new services ranging from home-delivered healthy meals to help paying rental security deposits.
But a quarter of the health care insurers, nonprofit organizations, and others responsible for implementing the program don’t know enough about it to serve those in need, and many are not equipped to refer and enroll vulnerable patients, according to research by the California Health Care Foundation. (KFF Health News publishes California Healthline, an editorially independent service of the California Health Care Foundation.)
The survey found that only about half of primary care providers and hospital discharge planners are very or somewhat familiar with the initiative, even though they are essential to identifying patients and referring them for services.
“These workers are on the front lines and if they don’t know about it, that’s a pretty easy win to educate them so they can help more people,” said Melora Simon, an associate director at the foundation, which conducted the survey between July 21 and Sept. 12. The initiative debuted in January 2022.
“These workers are most likely to see people in the hospital, in crisis,” she added, and “have the opportunity to do something about it.”
The roughly two dozen managed care insurance companies serving patients in Medi-Cal, California’s Medicaid program for low-income people, are responsible for identifying and enrolling patients into the program, and providing the new services. To make this happen, they contract with local government agencies, community nonprofit groups, social service organizations, hospitals, community clinics, and more. Those organizations can also make referrals and link patients to new services. The foundation surveyed 1,196 of these so-called implementers.
Most of the respondents said state payment rates do not cover the cost of providing expensive social services, and half say the workforce they need to deliver them is “tapped out and overwhelmed.”
About 44% also cited inconsistencies and different rules imposed by managed care plans, making participation very or somewhat challenging. For example, some insurers provide on-the-spot Uber rides for doctor appointments while others offer only a bus pass. Plus, not all plans offer the same services.
The survey did pinpoint some early successes. For instance, about half of respondents said the initiative has enabled them to serve more people, and that their ability to manage the comprehensive needs of patients has gotten better.
Tony Cava, a spokesperson for the state Department of Health Care Services, which administers Medi-Cal, acknowledged that the survey findings “resonate” and said the state is working to streamline and standardize patient referrals and authorizations.
“Implementers are on board with the core goals, and we are seeing improvements. But there is room to increase familiarity with CalAIM and broaden and deepen networks,” Cava said.
He said CalAIM represents a major shift in how Medi-Cal delivers care, and that the “kind of seismic system change that we are undergoing takes time.”
“Rather than reactive, we are moving toward a system that is proactive and considers all factors affecting health — the social drivers of health — and not simply what may happen inside of a medical facility,” he added.
The department provides financial and technical assistance to implementers, though only about one-third of survey respondents have found the training, technical guidance, and other resources adequate.
Van Do-Reynoso, chief healthy equity officer for CenCal Health, the Medi-Cal health insurer serving Santa Barbara and San Luis Obispo counties, acknowledged that it has been difficult to provide a full complement of CalAIM services. She cited a variety of obstacles such as inadequate reimbursement, lack of housing, and working with social services agencies unfamiliar with the health care system.
Nearly 3,000 CenCal enrollees are receiving CalAIM services, she said, many of them housing- and homelessness-related.
“We are working hard to better engage with hospital CEOs, community providers, and medical providers,” Do-Reynoso said. “People are getting housed. They’re practicing sobriety. It has only whetted our appetite to continue doing this work.”
When Newsom launched CalAIM, the Democratic governor promised it would transform Medi-Cal. The goal, his administration said, is to improve health and prevent people from winding up in costly institutions like the emergency room and jail, and to help move homeless people into housing.
It’s unclear how many of the 15.2 million Californians enrolled in Medi-Cal are eligible for new services and benefits, but several large populations qualify, including homeless Californians, people leaving jail or prison, foster children, people with severe mental illness or addiction, and older nursing home residents who want to transition home.
So far, about 141,000 Medi-Cal patients have a personal care manager through CalAIM, according to Cava, though hundreds of thousands more likely qualify. About 76,000 patients are receiving other social services, which are optional for plans to offer, he said.
In some cases, qualified Medi-Cal enrollees are turning down new services because they are being offered at the wrong time or by the wrong person, Simon said. For instance, a homeless person might not accept services from a police or code enforcement officer.
Insurers say they want to do more but need more help from the state.
“I am very hopeful that a year from now, we are going to be able to demonstrate even greater strides,” Do-Reynoso said. “What we hear often is what is reflected in the survey. We need higher rates, more communication, a more streamlined approval process.”
This article was produced by KFF Health News, which publishes California Healthline, an editorially independent service of the California Health Care Foundation.
FTC Chief Gears Up for a Showdown With Private Equity
A recent Federal Trade Commission civil lawsuit accusing one of the nation’s largest anesthesiology groups of monopolistic practices that sharply drove up prices is a warning to private equity investors that could temper their big push to snap up physician groups.
Over the past three years, FTC and Department of Justice officials have signaled they would apply more scrutiny to private equity acquisitions in health care, including roll-up deals in which larger provider groups buy smaller groups in a local market.
Nothing happened until September, when the FTC sued U.S. Anesthesia Partners and the private equity firm Welsh, Carson, Anderson & Stowe in federal court in Houston, alleging they had rolled up nearly all large anesthesiology practices in Texas. In the first FTC legal challenge against a private equity purchase of medical practices, the federal agency targeted one of the most aggressive private equity firms involved in building large, market-dominating medical groups.
In an interview, FTC Chair Lina Khan confirmed that her agency wants to send a message with this suit. Welsh Carson and USAP “bought up the largest anesthesiology practices, then jacked up prices and entered into price-setting and market-allocation schemes,” said Khan, who was appointed by President Joe Biden in 2021 to head the antitrust enforcement agency, with a mandate to combat health care consolidation. “This action puts the market on notice that we will scrutinize roll-up schemes.”
The large and growing volume of private equity acquisitions of physician groups in recent years has raised mounting concerns about the impact on health costs, quality of care, and providers’ clinical autonomy. A JAMA Internal Medicine study published last year found that prices charged by anesthesiology groups increased 26% after they were acquired by private equity firms.
“Now we’re seeing that scrutiny with this suit,” said Ambar La Forgia, an assistant professor of business management at the University of California-Berkeley, who co-authored the JAMA article. “This suit will cause companies to be more careful not to create too much local market power.”
The FTC’s lawsuit alleges that USAP and Welsh Carson engaged in an anti-competitive scheme to gain market power and drive up prices for hospital anesthesiology services. The FTC also accuses USAP and Welsh Carson — which established the medical group in 2012 and has expanded it to eight states — of cutting deals with competing anesthesiology groups to raise prices and stay out of one another’s markets.
USAP now controls 60% of Texas’ hospital anesthesia market, and its prices are double the median rates of other anesthesia providers in the state, according to the lawsuit. Learning that USAP would boost rates following one acquisition, a USAP executive wrote, “Awesome! Cha-ching,” the civil complaint said.
In a written statement, Welsh Carson, which also holds sizable ownership shares in radiology, orthopedic, and primary care groups, called the FTC lawsuit “without merit in fact or law.” It said USAP’s commercial rates “have not exceeded the rate of medical cost inflation for close to 10 years.”
The New York firm also said its investment in USAP “has allowed independent anesthesiologists to deliver superior clinical outcomes to underserved populations” and that the FTC’s action will harm clinicians and patients. Welsh Carson declined a request for interviews with its executives.
“This is a pretty common roll-up strategy, and some of the big private equity companies must be wondering if more FTC complaints are coming,” said Loren Adler, associate director of the Brookings Schaeffer Initiative on Health Policy. “If the FTC is successful in court, it will have a chilling effect.”
Since the FTC filed the USAP lawsuit, Khan said, the agency has received information from people in other health fields about roll-ups it should scrutinize. “We have limited resources, but it’s an area we are interested in,” she said. “We want to focus on where we see the most significant harm.”
In physician acquisition deals, PE firms typically use mostly borrowed money to acquire a controlling interest in a large medical group, pay the physician owners a substantial upfront sum in exchange for sharply cutting their future compensation, and install a management team. Then they seek to acquire smaller groups in the same geographic market and bolt them onto the original medical group for more bargaining clout and operating efficiencies.
The PE firm’s goal is to garner at least 20% dividends a year and then sell the group to another investor for at least three times the purchase price in three to seven years. Critics say this short-term investment model spurs the investors and medical groups to boost prices and cut staffing to generate large profits as fast as possible.
“Private equity is trying to extract value quickly and sell the company for a profit, so there’s a lot more incentive to increase prices quickly and extract higher revenue,” La Forgia said.
In the two years after a sale, PE-owned practices in dermatology, gastroenterology, and ophthalmology charged insurers 20% more per claim on average than did practices not owned by private equity, according to a JAMA study published last year.
There are similar concerns about hospital systems acquiring physician practices, which also have raised prices. “The evidence shows that both private equity and hospital acquisitions of physician practices are bad for consumers, and scrutiny should be applied to all acquirers,” Adler said.
Critics warn that private equity roll-ups of medical groups can jeopardize quality of care, too. Chris Strouse, a Denver anesthesiologist who served on USAP’s national board of directors but left the company’s Colorado group out of disapproval in 2020, cited patient safety issues arising from short staffing and mismanagement. He said USAP would schedule shifts so that three or four providers would hand off to each other a single surgical procedure, which he said is risky. In addition, USAP frequently asked anesthesiologists to work the day after working a 24-hour on-call shift, he said. “The literature shows that’s outside the safety range,” he said. As a result, many providers have left USAP, he added.
The FTC has long been lax in monitoring roll-ups of physician groups, in part because federal law does not require public reporting of these deals unless they exceed $111.4 million in value, a threshold adjusted over time. Lowering the threshold would require congressional action. As a result, regulators may be unaware of many deals that lead to gradual market concentration, which allows providers to demand higher prices from insurers and employer health plans.
Recognizing that problem, the FTC proposed in June to beef up its reporting requirements for companies planning mergers, in hopes of spotting previous acquisitions of smaller groups that could lead to excessive market power and higher prices. In addition, in a draft of their merger review guidelines, issued in July, the FTC and the Department of Justice said they would consider the cumulative effect of a series of smaller acquisitions.
“The ways PE firms are making serial acquisitions, each individual acquisition is under the radar, but in aggregate they roll up the whole market,” Khan said. “Between the merger reporting form and the new merger guidelines, we want to be able to better catch unlawful roll-up schemes. … This would enable us to stop roll-ups earlier.”
But Brian Concklin, a lawyer with the law firm Clifford Chance, whose clients include private equity firms, said the FTC’s proposed reporting requirements would hamper many legitimate mergers. “The notion that they need all that information to catch deals that lessen competition seems overblown and false, given that the vast majority of these deals do not lessen competition,” he said. “It will be a substantial burden on most if not all clients to comply.”
Researchers and employer groups, however, were encouraged by the FTC’s action, though they fear it’s too little, too late, because consolidation already has reduced competition sharply. Some even say the market has failed and price regulation is needed.
“Providers have been able to extort higher prices on services with no improvement in quality or value or access,” said Mike Thompson, CEO of the National Alliance of Healthcare Purchaser Coalitions. “The FTC stepping up its game is a good thing. But this horse is out of the barn. If we don’t have better enforcement, we won’t have a marketplace.”
Medicare Advantage Increasingly Popular With Seniors — But Not Hospitals and Doctors
A hospital system in Georgia. Two medical groups in San Diego. Another in Louisville, Kentucky, and nearly one-third of Nebraska hospitals. Across the country, health care providers are refusing to accept some Medicare Advantage plans — even as the coverage offered by commercial insurers increasingly displaces the traditional government program for seniors and people with disabilities.
As of this year, commercial insurers have enticed just over half of all Medicare beneficiaries — or nearly 31 million people — to sign up for their plans instead of traditional Medicare. The plans typically include drug coverage as well as extras like vision and dental benefits, many at low or even zero additional monthly premiums compared with traditional Medicare.
But even as enrollment soars, so too has friction between insurers and the doctors and hospitals they pay to care for beneficiaries. Increasingly, according to experts who watch insurance markets, hospital and medical groups are bristling at payment rates Medicare Advantage plans impose and at what they say are onerous requirements for preapproval to deliver care and too many after-the-fact denials of claims.
The insurers say they’re just trying to control costs and avoid inappropriate care. The disputes are drawing more attention now, during the annual open enrollment period for Medicare, which runs until Dec. 7.
Stuck in the middle are patients. People whose preferred doctors or hospitals refuse their coverage may have to switch Medicare Advantage plans or revert to the traditional program, although it can be difficult or even impossible when switching back to obtain what is called a “Medigap” policy, which covers some of the traditional plan’s cost-sharing requirements.
For example, more than 30,000 San Diego-area residents are looking for new doctors after two large medical groups affiliated with Scripps Health said they would no longer contract with Medicare Advantage insurers.
“The insurance companies running the Medicare Advantage plans are pushing physicians and hospitals to the edge,” said Chip Kahn, president and CEO of the Federation of American Hospitals, which represents the for-profit hospital sector.
The insurance industry’s lobbying arm, AHIP, said in a February letter to the Centers for Medicare & Medicaid Services that prior approvals and other similar reviews protect patients by reducing “inappropriate care by catching unsafe or low-value care, or care not consistent with the latest clinical evidence.”
AHIP spokesperson David Allen said in an email that Medicare Advantage plans are growing in enrollment because people like them, citing surveys conducted by an AHIP-backed coalition.
The vast majority, he wrote, said they were satisfied with their plans and the access to care they provide.
The disputes so far don’t appear to center on any particular insurer, region, or medical provider, although both UnitedHealthcare and Humana Inc. — the two largest Medicare Advantage insurers — are among those that have had contracts canceled.
Baptist Health in Louisville, Kentucky, said in a statement that all nine of its hospitals, along with its clinics and physician groups, would cut ties with Advantage plans offered by UnitedHealthcare and Wellcare Health Plans Inc. beginning in January unless they reach an agreement.
“Many Medicare Advantage plans routinely deny or delay approval or payment for medical care recommended by a patient’s physician,” Baptist Health said in its statement.
The system’s medical group, with nearly 1,500 physicians and other providers, left Humana’s network in September.
In a similar move, Brunswick, Georgia-based Southeast Georgia Health System, which includes two hospitals, two nursing homes, and a physician network, warned this fall that it would end its contract with Centene Corp.’s Wellcare Medicare Advantage plans in December, citing what it said was years of “inappropriate payment of claims and unreasonable denials.”
In some cases, health systems’ threats to abandon Advantage plans — as well as insurers’ threats not to include providers in their networks — are negotiating tactics, intended as leverage to win concessions on payment rates or other issues. And some have been resolved. Ohio’s Adena Regional Medical Center, for example, said in September it would drop Medicare Advantage plans offered by Elevance Health, formerly known as Anthem Inc., but reinstated them following additional negotiations.
Still, some hospital and policy experts say the conflicts may be the beginning of a trend.
“This seems different,” said David Lipschutz, associate director and senior policy attorney at the Center for Medicare Advocacy, who said hospitals and doctors are becoming “much more vocal” about their frustration with some cost-control efforts by Medicare Advantage insurers.
“There have been serious problems with payment suspensions and reviews that annoy the providers. I would not be surprised if we start to see more of this pushback” as the Medicare market becomes more concentrated among a handful of insurers, said Don Berwick, president emeritus and senior fellow at the Institute for Healthcare Improvement and a former CMS administrator.
While availability varies from county to county, Medicare beneficiaries can choose on average among 43 plans, according to KFF. UnitedHealthcare and Humana account for about half of the nationwide enrollment in Advantage plans.
Studies show that Medicare Advantage costs taxpayers more per beneficiary than the traditional program. But the plans enjoy the backing of many lawmakers, especially Republicans, because of their popularity.
The Health and Human Services Department’s inspector general reported last year that some Advantage plans have denied coverage for care that should have been provided under Medicare’s rules.
The report examined prior authorization requests — a requirement to seek insurers’ OK before certain treatments, procedures, or hospital stays — and claims denials, where insurers refuse to pay for all or part of care that’s already been performed.
Lawmakers have recently demanded additional information from Advantage insurers about the factors they use to make such determinations.
CMS proposed a rule this month to cap commissions for brokers who sell Medicare Advantage plans and require more detail on how the plans’ prior approval programs affect certain low-income enrollees and people with disabilities.
Lipschutz said the HHS inspector general’s study may have encouraged hospitals and doctors to be more outspoken.
The inspector general’s office found that 13% of the denied requests for treatment it reviewed and 18% of denied claims were for care that should have been covered. Responding in part to that report, the Biden administration issued a rule set to take effect in January that requires Medicare Advantage plans to provide “the same medically necessary care” as the traditional program. Every Advantage insurer must also annually review its own policies to make sure they match those in the traditional program.
The American Hospital Association, while lauding the administration’s action, questioned whether it would be enough. In a letter sent last month to CMS, the hospital lobbying group said its members “have heard from some [insurers] that they either do not plan to make any changes to their protocols” or “have made changes to their denial letter terminology or procedures in a way that appears to circumvent the intent of the new rules.” The letter urged “rigorous oversight” by CMS.
Allen, the AHIP spokesperson, did not respond to a request to comment on the AHA letter.