Healthcare Costs Analysis

Attached a link to an interesting article titled “Database to shed light on healthcare costs” reporting that researchers from the nonprofit, nonpartisan Health Care Cost Institute gained access to a database of 3 billion medical claims for more than 33 million individuals. The previously confidential information, scrubbed of identifying details, is being provided by three of the nation’s largest insurance companies: Aetna, Humana and United Healthcare, whose combined customers account for about 20 percent of Americans under age 65 who are insured through an employer. Until now, researchers have had to extrapolate from far smaller surveys of employers, or rely on government claims statistics from Medicare, which are almost exclusively limited to Americans over 65. The institute offered a first look at its findings, in a report that largely confirmed previously identified trends, but added intriguing details. The published results shed light on questions such as why healthcare costs are still rising faster than the inflation rate and why people seek less care. Attached a summary of the findings: Decline in healthcare utilization: According to the report, from 2009 to 2010 people with employer-sponsored insurance had 3.3 percent fewer admissions to hospitals and other medical facilities, 3.1 percent fewer “outpatient” visits to such facilities, and virtually no change in the number of procedures performed at doctor’s offices. In 2010, the average out-of-pocket payment for an admission to a hospital or other facility went up by more than 10 percent, to $700. The total charge for an outpatient visit including an emergency room visit or surgery that does not require an overnight stay also rose 10 percent, reaching $162. Reason: Cost-shifting to consumers of healthcare services. Many employers push more of the cost of care onto workers in the form of higher deductibles, co-pays and co-insurance. Prices grew at faster rates than the intensity of services: Increased spending by not just patients but employers was primarily caused by increases in the prices that hospitals, doctors and other providers charged for every category of service in 2010. The total price per outpatient visit, including the insurer and the out-of-pocket share, rose 10 percent, to $2,224. The increase was also significant for inpatient admissions, which went up 5.1 percent, to $14,662. Higher healthcare spending for younger patients: The growth in spending per patient in 2010 was as much as twice as high for those 18 and under than for any other age group. Does this mean that younger patients will have higher costs through their lives, which raises implications about bending the long-term cost curve? In my opinion we need more of those data to learn more about healthcare spending and how to contain rising healthcare costs.

Medicare Fraud and "Obamacare"

Attached an interesting article by Jay Weaver titled "Feds arrest more than 100 Medicare fraud suspects in South Florida, nationwide" reporting that several days ago, the feds charged 107 suspects with submitting $452 million in false bills to Medicare in seven U.S. cities. In the Miami area, 59 of those defendants were accused of trying to steal $137 million from the taxpayer-funded healthcare program.As a result of stepped-up law enforcement Medicare’s expenditures for a variety of medical services in South Florida decreased by a half-billion dollars over the past year alone! Its also important to emphasize that these successful efforts to curb Medicare fraud are part and parcel of the Patient Protection and Affordable Care Act (PPACA). The President has made a commitment to reduce Medicare fraud 50% by 2012. Therefore, the Affordable Care Act provides an additional $350 million over the next ten years to help fight fraud through the Health Care Fraud and Abuse Control Account (HCFAC) from FY 2011 through 2020. The Act also allows these funds to support the hiring of new officials and agents that can help prevent and identify fraud. Furthermore, the Affordable Care Act directs the Sentencing Commission to increase the Federal sentencing guidelines for health care fraud offenses by 20-50% for crimes that involve more than $1,000,000 in losses. The law makes obstructing a fraud investigation a crime and makes it easier for the government to recapture any funds acquired through fraudulent practices. And the law makes it easier for the Department of Justice (DOJ) to investigate potential fraud or wrongdoing at facilities like nursing homes. Those "Obamacare" opponents who rail against the law should be reminded that they have failed to provide an alternative option on how to save half-billion dollars over the past year! Yours Bernd