Insurance Reform: Part 2
Jim Shmerling, DHA, FACHE, President and CEO of Children's Hospital Colorado
"Child" seemingly absent from health care legislation
My friend and colleague, Dr. Jonathon Bates, president and CEO of Children's Hospital Arkansas shared some interesting statistics related to the Patient Protection and Affordability Care Act (PPACA). In the 2,409 pages of legislation, there were 425,157 words.
- "child" was mentioned 258 times
- "pediatrics" 82 times
- "quality" 544 times
- "cost" 69 times
- "reduction" 187 times
- "savings" 57 times
Despite the length of this reform legislation, there was tremendous ambiguity that resulted in directives to the Secretary of Health and Human Services to fill in the blanks. "The Secretary shall…" was stated 1,045 times! This reflects the still-open-ended questions remaining in health care reform.
Although children and pediatrics are mentioned relatively few times, this legislation's impact on children and their health care providers is significant. Children's Hospital Colorado has seen the horrific impact on families when their child is born with a congenital anomaly. Adding insult to injury, their family health insurance plan denies their child insurance coverage because of a pre-existing condition. Other children who may have experienced a single, but serious, medical condition sometimes are also denied coverage.
No more denying pre-existing conditions
Recently I encountered a young family with a 3-year-old daughter who moved to Colorado. They were insured but because they moved from another state, they weren't allowed to bring their coverage to Colorado. (This is one insurance revision not included in health care reform which should have been). Because their 3 year old had visited an emergency room for an acute medical episode more than two years ago, and even though there had been no reoccurrence of the condition, the same health plan in Colorado denied their child coverage because she had a "pre-existing" condition. Fortunately for this family they were granted coverage after they appealed the decision.
The underwriting rules used by insurance companies have become so rigid and risk-averse we have circumstances such as these that preclude children from receiving insurance. Even when a patient does have an illness at birth, is it fair that a child be preempted from having insurance coverage? Study after study has demonstrated that denying insurance negatively impacts that patient's health and even life expectancy. When an uninsured person does get medical care, it is usually late in the illness's progression and is more costly to treat than if care had been initiated earlier. Thankfully for all of us, health care reform has eliminated this practice (for children this year; for adults by 2014).
Elimination of annual and lifetime caps
The other major change impacting children, families and those with life threatening chronic conditions is the elimination of annual and lifetime caps on health plans. Treating a child with heart disease, cancer, cystic fibrosis and other chronic conditions can place a tremendous financial burden on families. Significant bankruptcies result from the costs associated with treating these illnesses while the family is uninsured or underinsured.
Medicaid will pay for primary care services
Medicaid programs across the country allow each state to determine benefit and provider reimbursement rules resulting in 50 different methodologies. For the first time since Medicaid's inception, the federal government has set a consistent federal payment floor that requires states to pay for primary care services at Medicare levels in 2013 and 2014. It also creates a mandatory Medicaid eligibility category that includes all individuals with family income up to 133 percent of the federal poverty level (FPL).
There is also a provision to expand demonstration grants for improving the quality of children's health care and the use of health information technology. As mentioned in my previous post, a Center for Medicare and Medicaid Innovation will be created to test innovative payment and health delivery models. We are working tirelessly to create such an innovative model in concert with our community of pediatric providers as well as the University of Colorado faculty.
With or without federal funding, Children's is determined to develop innovative delivery models of care that improve the health of children. As one of my former mentors used to say, "It isn't enough to put Humpty Dumpty back together again - we have to keep him from falling off the wall altogether." Models of care for children must include working with primary care providers to keep children healthy and out of the hospital.
The new benefits of primary care practice
Finally there is a provision to support physicians who want to practice primary care. Physicians who go into primary care can receive loan repayment. To encourage them to accept Medicaid patients, they will be paid Medicare rates (while not large dollars, it represents an increase of between 20 to 30 percent reimbursement from the existing Medicaid reimbursements).
Health care reform has only just begun
It will take a long time to figure out the implications of this landmark health care reform legislation. As I have described, when it comes to children, there are significant potential outcomes - some will benefit pediatric health care providers, some will negatively impact pediatric health care providers, and there are significant unknowns (with potential downside). With legislation this wide-sweeping, unforeseen negative consequences are inevitable, which we will have to deal with when the time comes.
The first of the changes are designed to bring uninsured children into the world of insurance coverage, removing pre-existing barriers (pun intended).