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Posts Tagged ‘affordable care act’

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Healthy Minnesota: Communities in Action

By: Editor

Published on: Friday, September 14th, 2012

By Laura Templin-Howk

In March of this year, the Health Care UST MBA cohort 18 experienced an opportunity of a lifetime. We were in Washington, D.C., as the opening arguments for the legality of the Affordable Care Act (ACA) were presented to the United States Supreme Court. Whether we agreed or disagreed with the content, the ACA was the most significant health care legislation to leave a president’s desk since the passing of Medicare in 1965. Through the influences of Senator Dave Durenberger, we were introduced to more than 25 political players who were all candid about their ACA opinions and their predictions of the Supreme Court ruling.

Fellow student Tina Morey and I left Washington, D.C., with a revived sense of hope that a paradigm shift in health care is on the horizon. Title IV of the ACA, “Prevention of Chronic Disease and Improvement of Public Health,” was the first legislation to place financial support for proactive, preventative measures. Title IV Subsection D, “Creating Healthier Communities,” provides an outline to encourage the funding of local projects that are created with the intent of population-based prevention programs through Community Transformation Plans. The beauty of this section is to encourage bottom-up, localized creativity in addressing community health concerns. Healthier schools, healthier food options, physical activity opportunities, promotion of healthy lifestyles, emotional wellness, prevention curricula, activities to prevent chronic diseases, infrastructure creation, racial and ethnic disparities reduction are all possible components of Community Transformation Plans.

We did not have to look farther than our backyards to see active examples of healthy community initiatives; in my case, the golden nugget was in my hometown of New Ulm, MN. (more…)

Posted in Health Policy, Leadership | No Comments »

How much will my health insurance cost?

By: Daniel McLaughlin

Published on: Friday, June 29th, 2012

With the Supreme Court ruling the Affordable Care Act constitutional, attention is now shifting to the details of the law – especially how the individual market will function in the insurance exchanges.

I had the opportunity to work on the Clinton health reform plan in 1992–1993. As part of this work, the White House sent us to various groups to present the proposed plan. I usually spoke to provider groups. At the beginning of the presentation, I always asked the audience to “Please raise your hand if you know someone who is uninsured or who has difficulty getting health insurance.” Almost all the hands in the room were raised.

My guess is that this question would yield similar results today. Although it’s likely that many health professionals are already working on implementing sections of the ACA (such as ACOs, medical homes, reducing re-admissions, etc.), they may not have paid a lot of attention to the individual market insurance details. Here are some basics to remind us of the details and some resources to share with any friends who are uninsured.  (more…)

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It’s Definitely a Roberts Court

By: Editor

Published on: Thursday, June 28th, 2012

Senator Dave Durenberger shares his reaction to the Supreme Court’s ruling on the Affordable Care Act and thoughts on where we should go from here. This post was originally published on his blog, NIHP.org.

In plain English:

Regardless of the spin that follows, Obamacare is the law of the land.  From now on it is open to criticism, repeal, or reform.  But it will be implemented and reform will require both political parties to find ways to cooperate.  It is a time now for the leaders of the health care industries in America and the leaders of America’s job creation community to step up to what should no longer be a political plate and be heard on policy implementation.

The president himself should take the first step to the plate and speak to the importance of the role of the law and the national government, not in delivering health care, but in shaping the payment policy which rewards a healthier people, healthy communities, and a value-oriented health care system.  This shouldn’t start in Washington but rather in communities across America. (more…)

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The Affordable Care Act Passed. Now What?

By: Editor

Published on: Monday, April 23rd, 2012

This article was originally published in the spring 2012 issue of  B. Magazine. 

In 2011, two Opus College of Business faculty members launched a study of more than 70 health care organizations. The outcome will assist these organizations in meeting the demands and challenges of a new, more transparent and more competitive market.

By Jack Militello, Ph.D., and Mick Sheppeck, Ph.D.

On March 23, 2010, President Obama signed into law the Patient Protection and Affordable Care Act. On March 30, 2010, the Health Care and Education Reconciliation Act of 2010 was signed into law. The two laws are collectively referred to as the Affordable Care Act (ACA). The ACA includes a wide variety of provisions designed to provide more health care choices, to enhance the affordability and quality of health care for all Americans, to hold insurance companies more accountable and to lower care costs; however, the ACA does not give direction to health care-related organizations as to how to implement its legislation. Implementation is the strategic challenge of every health care provider.

Two strategic theories underlie the expectations set by the ACA. The first is that, with the proper incentives in place, costs can be contained as better service is provided. The second is that a fully functioning and competitive market for health services will achieve the goals of the legislation. Any strategic responses to these theories of funds-flow and markets have to be taken in relationship to each other and in the context of the broader health care system.

A discrete response to the administrative-pricing directive of the ACA is quite simple: cut costs and retrench to meet pricing constraints while seeking new venues to gain revenue. The former is currently undertaken through a number of initiatives accepted within the industry. These include analytically based cost containment, operational-improvement protocols and employee-motivation programs. These initiatives are necessary but not sufficient to strategically succeed in the reform environment urged by the ACA and must be teamed with revenue-generating initiatives. The latter demands the application of each of these tools with the addition of an engagement with competing business models, potential partnerships, community and governmental relationships, generational-culture differences, and the power of the consumer. In short, it demands a systems perspective on a cash-flow strategy that addresses both costs and markets.

The health care delivery system offers myriad business models, ranging from nonprofit services through return-on-investment models for publicly traded companies. The core of the health care delivery system is the patient-provider relationship, but it then takes in all the suppliers of goods and services that support the core interaction. Each model is driven by a mission that aligns itself to the health care system as a whole. But first an internal organizational alignment of mission to the management of costs and markets has to occur.

An organization’s purpose should express its vision, either implicitly in its goals or explicitly in a statement of mission. Mission statements are often high-minded but lacking in connection to the actual operational management of the organization’s assets. A good mission should state long-term goals and determine how to measure progress toward reaching them, as well as providing the organization with a business model that defines a distinct competitive advantage. That advantage should be expressed in the value it provides to its customers, patients and stakeholders. An analysis of the alignment of mission with organizational operating factors would equip any health care provider with insight as to how to approach its markets.  (more…)

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Politics as usual?

By: Editor

Published on: Thursday, April 5th, 2012

By Matt Johnson

As part of the Health Care UST MBA’s spring Health Care Policy course, I had the distinct privilege of traveling to Washington, D.C., last week on a “field trip” led by the Honorable Senator David Durenberger. Our trip just happened to coincide with the Supreme Court listening to arguments about President Obama’s Affordable Care Act. A truly historic time to be actively engaged with Washington insiders as they discussed key health care issues. Over the course of two and a half days, our cohort had the opportunity to listen and interact with more than 25 of these political insiders from both sides of the aisle.

After digesting the hours of discussions we consumed, it would be very easy to leave depressed and cynical…and some of us did. I was impressed with the company of my Cohort 18 colleagues as they fired off relevant and astute questions to the likes of sitting U.S. Senators, powerful lobbyists, consultants, scholars,  journalists, the U.S. Surgeon General and the many influential people with whom we interacted. As I reflect on our D.C. adventure, it gives me continued hope that the future of how health care is delivered and managed in this country is as much our responsibility as any politician’s. As health care providers and leaders, we must increase our active engagement in these discussions and influence the policy makers accordingly.

(more…)

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Outside Consultant Q&A: Small business health insurance requirements

By: Editor

Published on: Wednesday, February 15th, 2012

In this column, Center for Health and Medical Affairs director Dan McLaughlin responds to a reader’s question about health insurance requirements for small business. It was originally published in the Minneapolis Star Tribune on Feb. 12, 2012.

question

What will be the impact of the new health insurance requirements on small businesses?

SARAH KELLY

P3 HAIR DESIGN

answer

The Affordable Care Act (health care reform) will significantly change health insurance for small employers in 2014.

For employers with fewer than 50 full-time employees, there will be no financial requirement to contribute to workers’ health care costs.

However, there are tax credits for these small employers to offer health insurance through state-operated health insurance exchanges.

If the employer does not offer health insurance, their employees must purchase it themselves. This is the highly controversial individual mandate. The tax credit will vary with employer size and the average wage in the company. Some employers are currently eligible for these tax credits and should receive them this year.

Employers with more than 50 employees must offer health insurance starting in 2014. If they do not, they must pay a penalty of $3,000 per employee.

All of these changes will be affected by political and judicial activities. The state of Minnesota must set up a health insurance exchange by 2013 or the federal government will operate the Minnesota exchange. The U.S. Supreme Court will review the Affordable Care Act this summer, and if the individual mandate is ruled unconstitutional, the operation of the exchanges will be significantly affected.

All employers will need to pay close attention to these developments over the next two years to make decisions on health benefits that are both financially and strategically sound.

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Essential benefits and the battles to come

By: Daniel McLaughlin

Published on: Thursday, October 20th, 2011

A key part of the Affordable Care Act (ACA) is the creation of state-based Health Insurance Exchanges to offer individuals and small business a standardized health insurance product. These policies will resemble benefit packages of small employers. Each of these health plans in the Exchange must provide an “essential benefit set” of services. But what does that mean?

In 1993 President Clinton’s task force on health care reform decided to define the essential benefit set as part of his health care reform proposal. A significant amount of the opposition to his plan was from provider groups that were excluded.

In 2010 the architects of the Affordable Care Act took this lesson to heart and developed a multi-step process which would define the essential benefit set of services over a number of years. First, the Institute of Medicine was asked to develop a process and guidelines for the initial development of and long-term updates to the benefit set. Their report was recently released and can be found here.

The second step is to define the essential benefit set; this will be done by HHS staff and their recommendations will be available in May, 2012. HHS has had a reasonably good track record of resisting pressure from provider groups to expand the Medicare benefit set significantly, so this initial set should meet the cost goals of the ACA.

A third component of the process allows state exchanges to modify the essential benefit set if the results are actuarially equivalent in cost. Here is where the challenge begins and the states’ history regarding benefits is not encouraging.

Most states currently have “mandated benefits” for fully insured products within the state. Over the years various provider groups have lobbied for the inclusion of their services into the mandated benefits which have made this type of insurance very expensive. Most reasonably sized companies have become “self-insured” to escape these mandates. For example:

chart10192011

Source: Perspectives on Essential Benefits — Workshop Report — Institute of Medicine

Because of this history, look for intense state legislative battles in the coming years among providers as they lobby to ensure their services are included as essential benefits. The actuarially equivalent definition will undoubtedly be stretched and vigorously debated. Some of the benefits that have been controversial in the past include:

  • Cosmetic surgery
  • Chiropractic care
  • Dental care
  • Care that is supportive but not clinical
  • In vitro fertilization
  • Experimental services, particularly drugs
  • And many more . . . .

Each state will face this challenge as they create their Health Insurance Exchange and they will struggle to keep the cost of health insurance affordable — which is, of course, the name of the law.

See how Minnesota is facing this challenge and others related to the implementation of health care reform at the UST Executive Conference on the Future of Health Care on Friday, October 28 in Minneapolis, MN.

This post was originally published October 19th on MedCity News.

Posted in Financing, Health Policy, Leadership, Operations Improvement, Uncategorized | No Comments »

Bundled payments – one more demonstration brought to life

By: Daniel McLaughlin

Published on: Wednesday, September 7th, 2011

32206553As elements of the Accountable Care Act (ACA) are being ramped up, it is useful to understand their origin. CMS has a long history of supporting many types of payment reform demonstrations and the new bundled payment system is a good example. 

Bundled payments are a new payment methodology in the ACA and this system is based on the Acute Care Episode (ACE) demonstration project. The ACE program pays a flat bundled rate for 9 orthopedic and 28 cardiac procedures. This fee includes hospital care, physicians and outpatient follow up and rehab. There are 22 quality measures reported each quarter to CMS.  Physician payments can be increased by 25 percent if certain cost reduction targets and quality goals are met. The Baptist Health System in Texas participated in the ACE project and immediately began to receive gain sharing payment from Medicare that ranged from $65 to $6,000 per admission. 

Other CMS demonstrations have shown that bundling payments improves care for patients, and leads to better health, better care and lower costs. 

(more…)

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Industry Insight: Understanding health care cost trends

By: Daniel McLaughlin

Published on: Wednesday, August 24th, 2011

37878562This post is part of a new series designed to highlight the most significant new reports on health care management or policy–ranging from government reports to health care business studies.

We will highlight reports that may be useful to the thoughtful and busy health care leader. Our health care programs at the Opus College of Business emphasize leadership, organizational transformation, and operational excellence. The reports we select will reflect these themes and can be helpful in strategy formulation, operations improvement and leadership activities. 

This series will show you at a glance what you need to know about current developments in health care management and policy.

 

Modest Acceleration in U.S. Health Care Costs According to the S&P Healthcare Economic Indices
August 18, 2011

One of the key drivers of the federal budget deficit is Medicare. Most actuarial assumptions that Congress uses to predict future costs show Medicare costs rising much faster than inflation.  However, this S&P report shows that Medicare cost inflation has had a remarkable decrease. If this cost inflation remains low, it seems reasonable that the federal government can resist significant reductions to provider payments or increased contributions from beneficiaries.

(more…)

Posted in Financing, Health Policy, Leadership, Operations Improvement | 1 Comment »

Uncertainty Surrounds the Health Insurance Exchanges

By: Daniel McLaughlin

Published on: Wednesday, August 17th, 2011

healthinsuranceThe most dramatic and significant aspect of the Affordable Care Act is now underway.

On July 11, 2011, the Department of Health and Human Services released its first set of proposed regulations governing the American Health Benefit Exchanges created by section 1311 of the Affordable Care Act. HHS also released proposed regulations governing the reinsurance, risk corridor, and risk adjustment provisions of the statute and posted a set of fact sheets answering questions about the new rule.

Although the exchanges are only expected to enroll approximately 30 million individuals, this new feature of the American health care system will likely have a much broader impact on the industry and comes with several unresolved issues:

(more…)

Posted in Health Policy, Leadership | 1 Comment »

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