MEDICARE VERSUS THE INDEPENDENT PAYMENT ADVISORY BOARD (IPAB)

Here is how it works: The Affordable Care Act (ACA) grants coverage to about 15 million persons not previously covered by what passed for health care coverage before passage of the ACA. Trouble is that Covered California and other ACA derived plans have now raised their premiums to cover the influx. But the premiums can't be raised enough to cover this influx. It has been determined that a better way  is to reduce utilization to keep costs below or equal to the pre-ACA expenditure. This method is a form of rationing with a special dagger aimed at the hearts of the elderly. It is called the Independent Payment Advisory Board (IPAB). 

Here's a pre-IPAB example: programs that provide vision care advise patients that refraction is not covered by Medicare or by most commercial PPO plans. Refraction is the method by which corrective lenses are prescribed. Medicare and the commercial PPOs determined that refraction isn't a medical procedure after all. Medicare and the involved PPOs conveniently decided that refractive errors requiring prescribed lenses are a result of changing eye-shape and are not because of disease.  Hence, coverage is denied.  

How about something more current than refraction? Let's take a look at what's happening to cardiac pacemakers. The Center for Medicare and Medicaid Services (CMS) has determined that as of 6 July 2015 coverage for cardiac pacemakers will be restricted to patients with "non-reversible symptomatic bradycardia." This decision means that patients with asymptomatic complete heart block would not be covered and that the exclusion will apply even to patients with asymptomatic Mobitz Type II heart block. So far our information is that the American Medical Association (AMA) has not filed a protest. We're now obliged to ask would-be presidents of AMA and contingent state medical associations where they stand on this matter.

We all recall Sarah Palin's barbs about "death panels" for Medicare. Suddenly, it doesn't seem as though she was all that far off the mark, does it?

That's where the Independent Payment Advisory Board (IPAB) comes in -- the IPAB was formed to manage costs that the ACA might run up due to the influx of previously non-covered patients. The IPAB owes its existence to Sections 3403 and 10320 of the ACA. The official job of the IPAB will be to control and cut Medicare spending. The IPAB according to the ACA will be appointed, not elected, and will not be obliged to report to Congress. In effect this technique will remove Congressional  oversight of Medicare spending. Instead,  unelected IPAB members will have this power. The salary for the 15 IPAB members is proposed to be about $165,000 annually -- once again we see there's money enough for bureaucracy but not for patients and citizens. The IPAB is ripe for repeal before it can do damage.

In the second Obama-Romney debate, Gov. Romney asked President Obama who would be appointed to the IPAB. Obama's answer, and I quote same in toto, was "doctors et cetera."
Although the reply was short, it was also wrong. Trouble is neither Romney nor Obama knew it. The fact is that there is nothing in Sections 3403 or 10320  or in the rest of the ACA that requires even one physician to be appointed to the IPAB. While it's likely that an acquiescent physician can be found, the fact is that there is no legal requirement under the ACA to appoint even one physician to the IPAB. The IPAB should be repealed forthwith -- so doing will improve the ACA by removing what to all intents and purposes looks as close to Palin's death-panels as one can get without handing the IPAB a portable gallows. 

MEDI-CAL PROVIDER CUTS: SB 640 AND AB 900

When does austerity mean tossing sick people under the bus?

Answer: anytime there's a government shortfall.

SB 640 (Lara) and AB 900 (Alejo) are designed to prevent the 10% Medi-Cal provider cuts that are now in the legislative hopper.  California is short of money. Apple's Tim Cook is now under the gun for sequestering money abroad in order to avoid taxes in the USA.  Last we looked, Cook was not only from America, but also from California. Not to worry. There's another way to get some money into California: cut down on the money spent on the sick and poor, especially citizens who are sick and poor at the same time.  That definition is fulfilled by Medicaid patients. In California, that program is called Medi-Cal.  

Medi-Cal has always had a sordid reputation in California. In 1981 Medi-Cal had to be coerced to  get back nearly a million dollars it carelessly overpaid to a single recipient for double-billing  (that was when a million dollars was still thought of as money).  The ante has  gone up since then but the program remains a conduit for channeling less and less money to  Medi-Cal patients. The impetus is to reduce Medi-Cal provider payments by 10% even though it's understood that such a move will drive providers out of the system.  Fewer providers plays into the hands of those who want more than the 10% cut. If enough providers opt out the cut in provider fees will considerably excced 10%.  Doctors will get blamed for not participating in a widespread system of moral bankruptcy and financial irresponsibility.

SB 640 and AB 900 will reverse the 10% cut providers and their patients suffer as a result of the 2011-2012  state budget. The California Medical Association has challenged the cuts in court and gets credit for sponsoring these bills.  We recommend support for SB 640 and AB 900.

ACCOUNTABLE CARE ORGANIZATIONS

The latest hot ticket item in healthcare now that the presidential election is over is the implementation of the most controversial aspects of the Affordable Care Act (ACA), namely, the individual mandate to buy health insurance, or else. Health insurance exchanges are ready to make their move as are specific Accountable Care Organizations (ACOs).

ACOs will be comprised of hospitals,  primary care physicians, and specialists who are supposed to accept being held accountable for the cost and quality of the healthcare they provide. Fiscal carrots is the name of the game because providers will continue to be paid on a fee-for-service basis and will share in whatever revenue is brought about by whatever cost-savings techniques the ACOs use, e.g., not accepting doctors who have too many elderly patients  or patients with expensive chronic diseases. The days of searching out rare and unusual diseases to care for are over: these unfortunates will be obliged to find  whatever comfort is available under the nearest bus. If the ACO is well managed from a fiscal perspective, providing participants will share in  the savings  as a second source of income. Quietly, with as little fanfare as possible, physicians and hospitals will be encouraged to avoid the sickest, oldest, and most complicated patients. Meanwhile, the ACA calls for expanding Medicaid despite a looming shortage of doctors.

Medicaid is supposedly administered on a state-by-state level. In June of  2012 the Supreme Court (SCOTUS) gave states an option to keep their Medicaid programs as is or expand them. So far, however, only 17 states and the District of Columbia have said they'll develop their own exchanges. Increasingly, therefore, it appears as though the federal government will pick up the exchanges by default and with it increased control of medical care.

Medicare cuts in the amount ot $716 billion are ready.  President Obama said he wouldn't cut Medicare itself, just the fees paid to all of the providers. Physicians, already getting only 18 cents on the dollar, will not be overjoyed and many are likely to stop accepting new Medicare patients.

Here's a comment from HHS: "The Department and its partners should be vigilant in identifying ... emerging fraud, waste, and abuse risk areas across all ACA-related programs ... this will require a comprehensive approach to program integrity that integrates effective front-end program gatekeeping (itlaics added)."

In 1998 this writer spoke at the White House in a press conference with then President Clinton. "Gatekeeping" was exposed as a mechanism to reduce patients' access to care. HMOs, seeing the handwriting on the wall, reformed their "gatekeeping" methods. Now, under the ACA, we're seeing new scribbling on the wall that'll enable return of the "gatekeepers."

Beware, patients: your illness may be your ticket to the hoosegow. Not to worry, though, your doctor will be in a near-by cell. The accusations will be "fraud" and "waste."

When your ACO contract arrives, you will need advice about what to do. Your first problem will be where to get that advice. Not to worry. In due course a new legal specialty will emerge.