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Last Friday afternoon, the Centers for Medicare and Medicaid Services (CMS) issued a short frequently asked questions (FAQ) document that should remove any remaining belief that the federal government will give state lawmakers flexibility on the Obamacare Medicaid expansion. The message is clear: The only thing a state that agrees to the Medicaid expansion will get is a bigger Medicaid program.

The CMS reiterated the position it took in an earlier FAQ that the Obama Administration considers the expansion to be an “all or nothing” proposition for states.

Read the rest on The Foundry…

Tags: burdensome, CMS, flexibility, HHS Secretary, Kathleen Sebelius, Medicaid Expansion, ObamaCare, States

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Accountable Care Organizations (ACOs)—a concept that a group of doctors and hospitals will work collectively to manage the care and costs of Medicare patients—were expected to transform the delivery of health care. Yet again, much like the rest of Obamacare, these promises appear to be falling short of expectations.

In writing for Heritage, founding member of the Galen Institute John Hoff explains:

ACOs, as described, are a strange hybrid of fee-for-service and managed care, subject to ongoing control by CMS [Centers for Medicare and Medicaid Services]. Like other hybrids, they are not likely to breed naturally. ACOs are a keystone of the PPACA [Patient Protection and Affordable Care Act], but they are unlikely to improve health care and reduce its costs. ACOs are further demonstration, if any is needed, that the PPACA is ill-conceived. CMS-directed change will not bring meaningful reform, but impede it.

Thus far, the experience of the first group of ACOs, the 32 “Pioneers” (as the government calls them), has been shaky, and some have suggested they might even drop out of the program.

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Tags: Accountable Care Organizations, ACOs, CMS, doctors, Medicare, ObamaCare, patients, pioneers

As Congress probes expensive public-relations contracts to market the unpopular Obamacare law to the American public, the Centers for Medicare and Medicaid Services recently announced that it has inked a deal worth more than $3 million to promote Obamacare’s “exchanges.”

CMS, a division of the Department of Health and Human Services, will pay PR firm Weber Shandwick at least $3.1 million for the new contract, according to a report in PR Week. Weber will promote state-based health care “exchanges” established by Obamacare.

The contract is the second major HHS contract landed by Weber. It inked a $3.4 million deal in 2010 to help Medicare patients spot and prevent fraud.

PR Week reports:

Weber will create a strategic plan with short- and long-term tactics for exchange outreach and education. The agency will also promote early awareness and foster engagement with consumers to help them learn more about coverage that they may be eligible for, as well as to promote upcoming enrollment periods, according to the RFP.

News of this latest PR contract comes on the heels of criticism from congressional Republicans over efforts to market Obamacare through popular television shows. “Americans’ hard-earned money should not be taken by government to subsidize Hollywood and insert propaganda into the popular culture,” a group of lawmakers said of that effort.

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Tags: CMS, HHS, ObamaCare, public relations contract, state-based health exchanges, Weber Shandwick

A new study reveals that nearly one-third of doctors nationwide are unwilling to accept new Medicaid patients.

The reason is that the government doesn’t pay enough to cover the cost of treating them. According to the Centers for Medicare and Medicaid Services Office of the Actuary, Medicaid physicians were paid only 58 percent of what private insurance paid in 2008.

The new study illustrates the correlation between Medicaid provider reimbursement and patient acceptance rates, stating that “acceptance rates of new Medicaid patients were higher in states with higher Medicaid-Medicare fee-for-service fee ratios. On average, a ten-percentage-point increase in fee ratio raised the acceptance of new Medicaid patients by four percentage points.”

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Tags: actuary, CMS, fee-for-service, Medicaid, new patients, physicians

Last week, the Government Accountability Office (GAO) sent a letter to Secretary of Health and Human Services (HHS) Kathleen Sebelius raising questions over her legal authority to spend $8.3 billion on a quality bonus payment demonstration for Medicare Advantage (MA) plans.

The demo was the most expensive project ever undertaken by the Centers for Medicare and Medicaid Services (CMS), and GAO concluded that it will be unsuccessful at improving quality and reducing costs.

Thus far, CMS has offered no response to the challenge of its legal authority. Section 402 of the Social Security Amendment of 1967 allows the Secretary to “modify methods of payment under Medicare to establish additional incentives to increase the economy and efficiency of services provided under the program by carrying out experiments and demonstration projects.”

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Tags: bonus demo, CMS, Government Accountability Office, HHS Secretary Kathleen Sebelius, Medicare Advantage, unsuccessful

The Centers for Medicare and Medicaid Services Office of the Actuary (OACT) just released its projections for national health spending through 2021. The picture isn’t pretty, as health spending will continue to increase at a much faster rate than the gross domestic product (GDP), consuming 19.6 percent (almost one-fifth) of the nation’s economy in 2021.

Growth in health spending will remain modest until 2014, when Obamacare expands Medicaid to an additional 19.6 million Americans and creates exchanges to regulate private insurance and administer new federal subsidies. Once these changes go into effect, Medicaid spending will increase by 18 percent, and private health insurance spending will increase by 7.9 percent, since more people will gain coverage through the government-run exchanges. According to OACT, “Together, Medicaid and private health insurance spending contribute to an overall acceleration in projected national health spending growth to 7.4 percent, which is 2.1 percentage points faster than would be expected in the absence of health reform.”

The Obama Administration clearly chose to wear rose-tinted glasses to interpret the projections. In an interesting twist on the CMS report, Secretary of Health and Human Services (HHS) Kathleen Sebelius touts “No increase in national health spending as a percent of GDP for five years.” But the Secretary backdates the projections, going on to say, “From 2009 through 2013, national health spending will not increase as a percent of the economy.” Of course, she knows that the major provisions of Obamacare don’t begin until 2014.

(Read the rest on The Foundry…)

Tags: CMS, GDP, Medicaid Expansion, national health spending, ObamaCare

Yet another provision of Obamacare is expected to cost taxpayers more than they expected. The House Energy and Commerce Committee recently sent a letter to the Centers for Medicare and Medicaid Services (CMS) asking for details regarding the probable loss of $3.1 billion out of the $3.4 billion in Obamacare loans to its Consumer Operated and Oriented Plan (“CO-OP”). The estimate comes from the President’s Budget Appendix, and the committee is considering rescinding funds that haven’t already been obligated.

The Obamacare initiative gives CMS the authority to award $3.4 billion in loan subsidies to states to fund start-up costs and to help meet state solvency requirements for the health plans in the CO-OP initiative, The Committee’s letter explains that these loans are a bad investment for taxpayers: “[T]he amount of expected losses is estimated to be about $3.1 billion of the $3.4 billion appropriated (91 percent). These losses exceed the estimate HHS presented in its proposed rule.”

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Tags: bad investment, CMS, Co-Op, House Energy and Commerce Committee, President's budget appendix, taxpayers

Health and Human Services Department (HHS) Secretary Kathleen Sebelius

Last week, the Centers for Medicare and Medicaid Services (CMS) announced that average premiums in Medicare Advantage (MA) for 2012 have fallen by 7 percent, and enrollment has increased by about 10 percent. This is great news for the program, which allows seniors to receive Medicare benefits through a private plan of their choice. But in a serious twist of logic, Department of Health and Human Services (HHS) Secretary Kathleen Sebelius credited Obamacare with MA’s success: “Now this is just one of the ways the Affordable Care Act is making stronger and more sustainable Medicare for years to come.”

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Tags: CMS, Medicare Advantage, Obamacare cuts, premium support, savings

The Office of the Actuary at the Centers for Medicare and Medicaid Services (CMS) recently published its annual estimate of U.S. health spending in the journal Health Affairs. The report shows that growth in health spending remained slow in 2010. Medical expenditures grew at an annual rate of 3.9 percent, up just 0.1 percent from 2009. However, the slow growth doesn’t represent a decrease in health care costs, but a reduction in utilization and intensity of medicine. People are choosing the less costly alternative of avoiding the doctor and not taking expensive prescription drugs.

The report primarily attributes the slow growth to effects of the recent recession:

Including the highest unemployment rate in twenty-seven years, a substantial loss of private health insurance coverage, employers’ increased caution about hiring and investing during the recovery, and the lowest median inflation adjusted household income since 1996.

Despite CMS’s and other health economists’ conclusion that the recession led to slow health spending growth, the Obama Administration published a blog stating that Obamacare is responsible, with no mention of the recession. Nancy-Ann DeParle, Assistant to the President and Deputy Chief of Staff, wrote that “(These numbers) do show why the Affordable Care Act is so important. And we’re confident the law will continue to help hold down cost growth in the years ahead.”  (Read the rest on The Foundry…)

Tags: CMS, health care spending, Medicare, ObamaCare, prescription drugs, repeal the law, utilization

Medicare continues to be a looming problem in the fiscal crisis. In an effort to lower the program’s cost and improve quality of care for the seniors it serves, Obamacare creates accountable care organizations (ACOs), which are supposed to encourage health care providers to band together and create savings through better coordinated care. In a new Heritage research paper, health policy expert John Hoff writes:

The ACO scheme is a microcosm of the PPACA (Patient Protection and Affordable Care Act) and, like it, will not deliver on its rhetorical promises. In the process of failing, it will waste financial and human resources, detract from meaningful reform, and give the Administration one more tool to exert control over Americans’ health care choices.

Hoff explains that the ACO scheme is a complex web of regulations, often internally inconsistent and confused, resulting in an odd structure. As one example, Hoff writes,

Medicare beneficiaries may be surprised to learn that they do not join an ACO as members. Nor is the process voluntary. Strange as it may sound, the CMS ‘assigns’ beneficiaries to an ACO, whether they like it or not…Beneficiaries will not know if they have been assigned to an ACO, or if so, which one. There is no provision for informing beneficiaries that they have been assigned to an ACO.  (Read the rest on The Foundry…)

Tags: Accountable Care Organizations, ACOs, CMS, Medicare, ObamaCare, physicians