Medicare – Part 4

I have now been on Medicare for 18 months. Fortunately, I have not required significant clinical services and therefore do not have a lot of experience with the financial impact of Medicare. The medical insurance part of Medicare costs between $99.90 per month and $369.10 per month (per person), depending on your income. The poliiticians imply that everybody pays the same for Medicare and it is time for people to pay their fair share. I do not know what would be considered fair, but a range of X to more than 3X is non-trivial. If you want to understand the Medicare premiums in detail, good luck — it is really complicated. Every time I decide to dig into it and understand it, I run out of time and give up. I did have occasion to go to an urgent care center in Florida in January. I contracted a bad case of rhinosinusitis (perhaps from grandchildren, perhaps from inadequate hand washing during the holiday travels) and needed some health care. It took a couple of weeks to get back to normal and then a couple more to get the claims detail from United Health, which is the supplemental medical insurance I get through IBM. It is coordinated with Medicare. In theory, whatever Medicare does not pay goes to the supplemental insurer for consideration. How this works is as clear as mud. Here is what my claim detail from United Health showed for my visit to the doctor at the urgent care center.

Not to worry. The footnote to the claim detail clears this up (right!).

This Plan Determines Benefits Once Medicare Makes Payment. If Medicare Pays Less Than This Plan’s Benefit, This Plan Will Consider The Difference. This Plan’s Allowable Benefits Are Based On The Medicare Approved Amount If The Physician Or Provider Accepted Medicare’s Assignment Or On The Limiting Charge If They Did Not Accept The Assignment. The Patient Is Responsible For The Difference Between The Allowable Amount And The Total Amount Paid By Both Plans. The Patient Must Pay Any Applicable Plan Deductibles And Copays Before This Plan Can Pay Any Benefits. Medicare payment was applied in the amount of $28.02

There was no co-pay, and if there is a deductible, it would seem that I would have to pay something. What exactly went to whom is a mystery to me. I am sure it is a mystery to our political leaders also. Medicare encourages preventative examinations and tests. That is a good thing, but if I followed all that are recommended, I would be a very busy person. Is there such a thing as too much care? Should care be “rationed”? These terms easily become highly emotional in both clinical and political terms.  Some say that Americans have too big of an “appetite” for healthcare services and there is a tug of war going on between the payers, the providers, the patients, and the politicians over what care should be provided. The answer is not more care or less care but more effective care. The entitlement model of paying for more visits, tests, and procedures is what has to change. An emerging new model to address this is called the “Accountable Care Organization” and it will begin the shift from a volume-based system to a value-based system. This is a good thing, and regardless of the 2012 political outomces, I do not see the shift changing.

An ACO relies on close hospital partnerships, collaborative alignment with physicians, robust information technology infrastructure and operational expense management. While the federal government is studying various models, the healthcare industry is moving toward the ACO model which  relies on the partnerships between healthcare providers to reduce healthcare costs while maintaining or improving quality of care. Successful ACOs will be rewarded financially, providing additional resources to invest in technology, jobs and other improvements in the delivery of care. The concept of the ACO is to have money flow to the ACO to keep patients healthy and have the money be allocated among the various providers — primary care physicians, specialists, laboratories, imaging centers, etc. Needless to say the method of allocation will make my sinusitis claim detail seem trivial.

One thing is for sure and that is that the current model of care is badly broken and unaffordable. When a 92 year old patient has an indication that a colonoscopy should be performed — knowing that surgery will not be performed regardless of the outcome of the examination — who is benefiting from the expenditure? When an elderly person is incapacitated and a wheelchair can dramatically improve their quality of life then it is a good investment by Medicare. When a person is grossly overweight because they enjoy Krispy Kreme doughnuts, does the spending of millions of dollars on TV advertising to entice that person to get a Medicare-paid “free” sporty electric wheelchair, is that effective or might diet and exercise combined with visits to various members of the ACO be a better investment for Medicare? I think we all know the answer. Be on the lookout for the term ACO. We will be reading much more about this in the local and national news.

Tags: accountable care organization, aco, colonoscopy, health, Healthcare, medical insurance, medicare, sinusitis, wheel chair, wheelchair

e-Government

e-Government is a really good idea and there are many initiatives underway to make it happen (see Government 2.0). In some respects the U.S. Government has been a model for using the Internet. The IRS e-file program, for example, has been very successful with nearly 99 million individuals filing their federal income tax returns electronically during 2010. Of the 141.5 million returns filed so far this year, almost 70 percent were filed electronically. There are other parts of the government that just don’t seem to get the idea of “electronic”. When I joined the Medicare program a year ago, I signed up for the Easy Pay program where the monthly Medicare premium is deducted automatically from my checking account. I have now changed my bank and so it was necessary to update various parties that either put money in or take money out of my account electronically. Except for Medicare, I was able to update them all online and have the changes take effect within a few days. Medicare said it was easy to change Easy Pay. Just complete an Authorization Agreement for Preauthorized Payments (Standard Form 5510). No problem. Where do I get that form online? Not available online. The authorization agreement may be obtained by calling 1-800-MEDICARE (1-800-633-4227). Upon request, 1-800-MEDICARE will mail a Medicare Easy Pay Packet directly to the beneficiary. The Medicare Easy Pay Packet includes a Medicare Easy Pay brochure, an Authorization Agreement for Preauthorized Payments, instructions for completing the authorization form, and a pre-addressed return envelope. All Authorization Agreements must be signed by the account holder and returned in the pre-addressed envelope to the address specified. Processing of the authorization form may take between 30 and 60 days. I called two weeks ago and still have not received the “packet”. Of bigger concern is that somebody thinks this is ok. Electric utilitiy companies have not always been known as model e-businesses, yet the three that I deal with all have an online application that takes just a minute or two to enter a new routing code and account number. Three to six minutes versus 30 to 60 days is not a small difference. Think of the cost of creating, printing, stuffing, mailing, and processing the contents of the Medicare “packet” compared to the electric company’s few mouse clicks. Think of how many employees have to touch the contents of the package. I am not making a political statement, but it is quite obvious that reducing the cost of government by hundreds of billions or perhaps trillions should not be difficult.

Meanwhile, the post office continues to operate 5,000 or so offices that are unprofitable and deliver mail six days per week. They have seen a huge drop in mail because of Internet applications such as e-file, e-billing, Quicken BillPay, electric and telecommunications companies taking credit cards and sending e-statements, etc. Unforutnately for the post office, they haven’t seen the worst of the dropoff. Netflix now offers unlimited streaming for $7.99 per month. They spend $700 million per year with the post office distributing DVDs. The holloywood producers are fighting a losing battle to protect their old models. The $700 million revenue stream to the post office will go to zero. And then along comes Zumbox.  There is still a lot of mail that gets sent, not invoices, but notices of privacy policies, service updates, account information, etc. Billions of pieces of mail. This mail will soon be going to the cloud — to Zumbox. To get a Zumbox account you sign up and provide your email address and your snailmail address. Zumbox goes to AT&T, Charles Schwab, Comcast, JC Penney, and the rest and gives them the addresses of people who have signed up for Zumbox. The companies then send all their mail to those members to the members mailbox at Zumbox. As a Zumbox user, you just login to the Zumbox website and check your mail. The mailers save a bunch of money, we save time from retrieving, opening, and throwing away the paper mail. Unfortunately, the post office revenue decline accelerates. It will not be too long before the post office will not have any mail to deliver.

Tags: e-billing, e-file, irs, medicare, post office, zumbox

Medicare – Part 2

Hard for me to believe but I am about to go on Medicare! As I described in a rant about browser issues, the experience to date has been only with the administrative aspects– the clinical part does not start until next month. The entire enrollment was able to be completed online at medicare.gov — no faxes, no forms, no paper — and once I got the password issue resolved, I concluded that the mymedicare.gov web site is pretty good. Several improvements have been made to the site since I first learned about it a few months ago and it provides a broad range of information. I was particularly pleased to see that they are promoting e-prescribing. Appears like the site is comprehensive — seems it handles most aspects of life with Medicare. Most — but not all.

Today I received the first payment notice from Medicare — the coverage is not free. Medicare requested payment for the first three months. A second letter referred to a higher amount that I would pay and it referred to a third letter that would explain where the higher amount came from. Turns out it comes from an income adjusted premium. Health and Human Services gets data from the IRS and determines what the 2010 Medicare premium should be based on 2008 adjusted gross income. Just like airline seats there is a wide range of premiums that people pay toward their government provided healthcare. It is also clear that the differential premium between those who pay and those who don’t will grow. I’ll leave it to the politicians to debate that and use this posting to talk about the payment method.

The premium payment notice offered the choice of using a credit card or sending a check. The web site has no payment options and  credit card payments can not be done by phone. An option for automatic ACH payments is available but you have to call to set it up. The call results in an “order” being placed to have a “package of forms” sent out. After returning the forms the setup will take 6-8 weeks. In the meantime the monthly premium will need to be paid by check or credit card. I can not think of a reason that such old fashioned payment methods are all that are available. Security and complexity would appear simple compared to the billions of dollars that Amazon handles so smoothly with no checks and forms. Perhaps the priority is not high to automate the payment side of Medicare since most payments are handled as deductions from social security payments. This will not be the case until I start receiving social security payments a year from now when I turn 66.

One good thing that HHS is doing is chasing after fraud. Ninety-four medical professionals around the U.S. were charged yesterday for their alleged involvement in a scheme to submit $251 million of false claims to Medicare. If it is a choice between automating my monthly payment versus deploying technology to eliminate or at least drastically reduce fraud I will clearly vote for the latter. IBM has been assisting in fraud detection for a long time (See  Fraud Reduction Could Fund A Chunk Of Healthcare). If ever there was a strong need for analytics it would be in fraud detection. By looking at patterns of provider applications, payment requests, repeat visits, diagnosis versus treatments, etc. it is possible to discern likely fraud. Billions of dollars have been recovered so far and unfortunately there are many more billions to go after. The amount of data is huge but the power of supercomputers and advanced analytics software is even more awesome. With thirty million more people coming into the healthcare system the number of transactions and potential for abuse will increase dramatically. The bad news is the likely increase in criminals targeting Medicare but the good news is that the tools are getting better and better and it appears that HHS is giving a high priority to applying the tools to the task at hand.

IBM is making large bets in healthcare beyond just fraud detection. Yesterday the company announced a three year Research investment to help medical practitioners and insurance companies provide high-quality, evidence-based care to patients and reduce costs.  As part of this initiative, IBM is hiring medical doctors to work alongside its researchers to develop new technologies, scientific advancements, and business processes for healthcare and insurance providers.

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Tags: fraud, Healthcare, IBM, medicare

Medicare – Part 1

Hard for me to believe but I am about to go on Medicare! I have some knowledge and experience with Medicare since my mother and father had it when they were living. It certainly provided well for them. I also see the other side of the Medicare coin — the reimbursement side —  as I serve on the board of the regional hospital here in Connecticut where I live. As far as I can remember, my parents were never denied coverage or reimbursement for something they needed. However, in the bigger picture of the hospital the pressures are clear and present. Downward pressures. Denial for reimbursement for things that happen to patients that Medicare decides should not happen. Intense scrutiny on charges that are submitted and threatened cuts to overall doctor reimbursements which may further threaten the availability of Primary Care Physicians. On the other hand are the TV advertisements showing smiling seniors zooming around their kitchen on stylish electric wheelchairs grinning about how Medicare has paid for the wheels. You have to wonder how much waste is in the system. Now I am about to find out in the years ahead and on a first hand basis.

The experience to date has been only with the administrative aspects– the clinical part does not start for a couple of months. After being notified by both the government and by IBM that the enrollment window had opened, I headed for medicare.gov. Much to my surprise the entire enrollment was able to be completed online. No faxes, no forms, no paper. The site was smooth and intuitive. Today I received the Medicare card via snailmail. This is when the first disappointment began. With my new Medicare number in hand I headed to the mymedicare.gov portal to see what was there.

I went through the simple registration process and then got a message saying I had already been enrolled. Turns out they do this automatically once you are assigned the Medicare number. Ok, great, now I can just sign in. But, what is my login id? Where do I get a password? I tried the “forgot my login” link without luck. Clicked help and saw they have live chat support. Great. The rep’s first question was what browser are  you using? Chrome. We don’t support that. You have to use Internet Explorer or Safari. Yuk. I do not use IE — it is the worst browser as discussed in patrickWeb many times. I don’t like Safari either. Why is it that you support only two browsers? That is all we support. No Firefox? No. Also, you must disable pop-up blocking. In Safari this is all or nothing, so to use mymedicare you have to expose yourself to any and all pop-ups on any site. Very bad. Finally gave up with the rep and called to speak to one. She was very helpful but said the problem is that my login had just been established three days ago and you can only request this every eleven days. Just be patient and wait for a letter in the mail with you password! Government one. Citizen zero.

Tags: browser, chrome, Healthcare, ie, medicare

Fraud Reduction Could Fund A Chunk Of Healthcare

On February7 we will be discussing Computational Biology at Demo. No doubt we will hear about some potential breakthroughs in healthcare. One thing we know for sure is that new healthcare solutions are costly. How will people afford them? There are many issues associated with this and one of them is the fraud that occurs in today’s system. IBM has been working on this area for years and recently introduced their solution in Rockland County, New York.

The IBM Verify New York Medicaid claims management program has identified $13M in potentially improper Medicaid billing in just 10% of the cases in just one county in just one state. For a modest software and consulting fee, IBM used it’s powerful supercomputers to do a sophisticated statistical analysis of the billing from the top 10% of Medicaid reimbursed pharmacies and general practice doctors in the county during a 21-month period. Seems like a good target since New York’s Medicaid program is the largest in the US, with an annual cost of $44.5 billion — and rising fast.

Rockland County has more than 41,000 residents who use Medicaid and the county spends about $384 million a year on their care. Initial estimates are that as much as $13 million of the billing may be improper. If this turns out to be the case, the nationwide numbers are in the $billions for sure. The IBM system uses thousands of queries to look for anomalies such as suspiciously large numbers of bills for services on a single day, repetitive or duplicate billing or unusually expensive services. Forty-two percent of the ten percent in Rockland County appeared to have discrepancies.

The project doesn’t mean that providers are automatically guilty nor that the money can be quickly recovered but at least it shows the investigators where to look. They have always had the data but with help from IBM they now have the tools. There are obstacles. In New York, the counties are responsible for Medicare but they are not allowed to take action against fraud. Only the state can do that — but they haven’t. The IBM program enables the counties to provide very specific information to the state and press for action to reduce fraud.

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Tags: analytics, fraud, IBM, medicaid, medicare, supercomputers