Payers & Providers Midwest Edition – Issue of July 19, 2011

8/6/2019 Payers & Providers Midwest Edition Issue of July 19, 2011

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Michigan legislators are working throughrevisions to the states Medicaid nancing planthat would effectively transfer the burden ofthe state matching funds from Medicaid

HMOs to the broader insured population.The Health Insurance Claims Assessment

Act was proposed by Gov. Rick Snyder, aRepublican, and its passage was assumed inhis budget proposal thatpassed the legislature earlierthis year. The tax passed theSenate June 30 and awaitsaction in the House.

But the bill is under erceopposition from the MichiganManufacturers Association.This powerful grouprepresents the core employers

of the wounded stateeconomy: the automakers,parts suppliers, and othergoods producers of theformerly high-wageindustrial heartland.

The new tax willfall disproportionatelyon manufacturers andself-insured companies, said DelaneyNewberry, director of human resource policyfor the association. She noted that 91% ofmanufacturers offer healthcare benets to theiremployees, compared to 71% of other

industries, 68% of service-providing

industries, and 38% in the leisure andhospitality sector. Newberry added that thenew HICA tax is levied directly on self-insuredcompanies, which account for two-thirds of

the private insurance market.The association fears that the law allows

the state to collect more than the Medicaidmatch and includes automatic upward

adjustments that will result inover-collections that will not bereturned to payers of the tax.

The manufacturers oppose itbecause theyve beenfreeloading on the system, saidDavid Waymire, spokesman forthe Michigan Association ofHealth Plans. Dont forget, theirinsureds have beneted from a

robust healthcare and hospitalsystem. That system is in somedegree of jeopardy.

They have been ableto get by by not payinganything into this so far.This is what the federalgovernment is saying wongo any more.

The new tax regimen comes after thefederal government let it be known thatcertain strategies of raising Medicaid matchingfunds on the state level would soon be

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September 14-16

August 23-25

Calendar

19 July 2011

July 20

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Payers & Providers Page 2

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In Brief

Michigan Blues RaisesRenewal Rates on Small

Business by 7.4%

Blue Cross Blue Shield of Michigan

announced it will raise small businessrates by an average of 7.4% in the fall,the lowest increase in six years, theinsurer said. Last year it raised rates onthis segment employers with 49 orfewer workers by 13.1%.

The Blues plan has the dominantmarket share in the state and isrequired to take all applicants. Thesmall business segment covers around230,000 people in Michigan. About10% to 15% of those, in roughly 4,400businesses, will be up for renewal inthe fourth quarter. John Dunn, the companys vicepresident of middle and small groupsales, said he was very pleased to see

these moderate rate increases. Byintroducing new products, improvingcost controls through our innovativepartnerships with doctors and hospitalsto improve quality and efciency, anddriving administrative savings, we wereable to effectively lower our rateincreases.

The Blue Care Network, an HMOproduct, will have an increase of8.7%, less than in 2010 but higherthan any other year since 2004.

Aurora Health PullsBack Nurses from

Milwaukee Schools

Ten Milwaukee public schools willlose their nurses this fall as part of apullback by Aurora Health Care. TheMilwaukee-based hospital system willcontinue to sponsor a fulltimeregistered nurse at one school.

Aurora Health Care reviews itsarray of services on an ongoing basisto better align services with patientneeds and best practices, spokesmanMike Brophy told the Journal-Sentinel

Continued on Page 3

NEWS

Medicaid Tax (Continued from Page One)

declared invalid. Currently, Michigan raises$400 million a year by levying a 6% use taxon Medicaid HMOs. That money is used to

leverage about $800 million in federalmatching funds for Medicaid.The federal government is concerned that

that use tax is not broad-based enough, saidDavid Finkbeiner, senior vice president foradvocacy at the Michigan Health and HospitalAssociation. Ofcials at the Centers forMedicare and Medicaid Services hadinformed the governors ofce that this form oftaxation to support Medicaid would probablybe disallowed in the near future.Instead of a tax on just the Medicaid plansthemselves, CMS wants to see a moreredistributive kind of tax, Finkbeiner said. The

governor of Michigan has been told, Makeyour move now, or time will run out.As a consequence, Snyder

recommended in his budgetthat the old tax be replaced bythe new claims tax. Instead oftargeting the Medicaidpopulation, it now will belevied against all insuranceclaims.

This problem affects anumber of states, which will allhave to change their tax policiesto continue to receive the

federal matching funds.The tax is levied on claims

paid, not premiums. When aprovider sends in a payment,a 1% tax will be incurred onthe insurer. The tax applies toall insurance companies andself-funded employer plans,but does not apply toMedicare or federal employee plans. Theymay pass it through, they may eat it, saidWaymire. They will have to decide.

The Michigan State Medical Society alsosupports the new tax.

Our view is its really more of an updatingof our state statute to comply with the pendingchanges at the federal level on the rulesrelated to assessments on different providerclasses, said Colin Ford, director of state andfederal government relations for the physiciansgroup. It raises roughly the same amount ofmoney as before. We support it. Its passed theSenate. Im optimistic.

The matching ratio from the federalgovernment is very favorable, Ford added. Ifthe tax was not passed, the state would be

foregoing $1.2 billion in Medicaid fundingwhich from the physician standpoint andhospital and nursing home standpoint, you

looking at at least a 20% cut inreimbursement rates.In Michigan Medicaid payments are

already substantially below most practicescosts, he said. Such a funding cut might pumany doctors away from serving Medicaidpatients.

Michigan Blue Cross and Blue Shield, tdominant insurance carrier in the state, wamore circumspect in its approach.

We are reviewing the Senate bill andestimate it would cost our customers in exof $100 million, said Helen Stojic, Blue Cspokesman. The insurer has not endorsed t

bill, opposed it, or taken a position at all.Were just monitoring it at this point,Stojic said, and havent saidanything about how it will beapplied.

The Michigan Blues are thelargest third-party administratothe state, handling claims formany employers such as thosethe manufacturers associationThey also wants to maintain grelations with hospitals andphysicians across the state.

Michigan has been in an

economic recession for a decaFinkbeiner said.

As a result, We haveexpanded our Medicaid rofrom 900,000 people to ne2 million people in the lastyears. We are very dependeon federal funds to supportMedicaid program. The stat

does not have $1.2 billion lying around to spent on Medicaid.

Michigans scal year begins Oct. 1, soSnyder asked the legislature early in thesession to adopt the tax changes. While the

House has adjourned for the summer, therstill time for it to pass the bill before the stabudgetary year begins.

We believe at the end of the day theHouse will pass it, Waymire said. This issame House that voted to spend the moneyWhy wouldnt they vote to fund the tax?

Everybody will benet from this, incluthe manufacturers, because it maintains arobust health system in our state, one that nancially fragile right now, he said.

David FinkbeinerMichigan Healthcare

and Hospital Association


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Page 3Payers & Providers

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NEWS

In Brief

newspaper. Aurora decided not torenew its commitment to the 10schools after spending money on theprogram for more than 10 years.Childrens Hospital of Wisconsin islooking at stepping up the nursingcoverage it offers the public schools.Were working with Milwaukee

Public Schools to determine whichschools we will have a presence in,said Bridget Clementi, a director forChildrens.

Public school nurses in Milwaukeework with a low-income student bodythat has above-average rates ofasthma, diabetes, and other healthproblems.

Schools with more than 250students will probably have somedaily nursing coverage, the schoolsystem said.

Illinois Reduces Rollsof Low-Income Seniors

Getting PrescriptionAid

In a further sign of the scal pressuresthat state ofcials are working under,Illinois is reducing the incomeeligibility requirements for low-income seniors and people withdisabilities who receive nancialassistance to buy prescription drugs.

About 43,000 people will losetheir state aid because lawmakersreduced funding for the program, to$53.7 million from $107 million inprior years. About 211,000 people arenow signed up for the Illinois Cares RxProgram.

To stretch the available funds, theDepartment of Healthcare andHuman Services raised co-pays andlowered income requirements. Asingle individual now must earn lessthan $21,780 to qualify, down from$27,610. A family of three must makeless than $37,060, compared to$45,657 earlier. Copayments forgenerics will go from $2.50 to $5.Brand-name prescriptions will cost a$15 copay, up from $6.30.

The state of Illinois is grapplingwith a severe scal emergency thatled the legislature to raise the incometax from 3% to 5% in January.

Starting Aug. 28, theres a new sheriff in townfor Missouri physicians. The Missouri Board of

Registration for the Healing Arts will haveenhanced tools for investigating and regulatingdoctors.

A new law, House Bill 265, signed by Gov.Jay Nixon last week, lets the board conduct ahearing if it has evidence or suspicion that adoctor is incompetent, under the inuence ofsubstances, or mentally ill. It can requirecompetency tests and then discipline him orher.

The law was drafted after the St. Louis Post-Dispatch newspaper last year published aseries of articles under the theme of WhoProtects the Patients? documenting the

failures of the states regulatory frameworkaround physician care. The board already ha

authority to suspend physicians who were adanger to patients, but it hadnt done so indecades. The present law required that casesagainst doctors be rst heard by anadministrative hearing commission, whichoften took several years.

The new law will make a doctorseducation, specialty certications, anddisciplinary record in other states subject topublic information. Until now, most of thatinformation has been kept private.

The new law enjoyed the support of patieadvocacy groups, such as Consumers UnionSafe Patient Project.

The shutdown of state government operations

that has hobbled Minnesota since July 1 haslargely spared hospitals and healthcareorganizations.

State payments to Medicaid providers,nursing homes, and mental health providerswere allowed to continue by the judgeoverseeing state operations during theprolonged budget impasse.

The shutdown went into effect afterRepublican leaders of the state legislature andDemocratic Gov. Mark Dayton could not reachagreement on a new budget. The legislaturerefused to accept Daytons proposal of spendingcuts plus a tax increase on the top 2% of

Minnesota income earners.The shutdown affected healthcare providers

in uneven and surprising ways, however.Providers asked special master Kathleen Blatz

to get background checks for new employee

deemed an essential service, so that theycould continue to staff patient care units, saiJan Hennings, director of communications fothe Minnesota Hospital Association. Blatz athe judge overseeing the shutdown, KathleeGearin, agreed.

But the judge did not allow state licensinboards to continue operating, so no newphysicians or nurses could begin practicing,and incumbent practitioners could not obtailicense renewals.

Now thats all moot, Hennings said,because on July 14, the governor andlegislators reached a preliminary agreement

halt the impasse and pass a budget.Ofcials expected the state to reopen for

business in stages over the next week.

Minn. Medicaid Spared in ShutdownState Pays Bills but Wont Relicense Doctors, Nurses

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Payers & Providers Page

The accountable care organization (ACO)model is sparking the imagination of leadersacross the U.S. health system. Most healthcareentities interested in this model already have aprofessional resource in place that could bepivotal: registered nurses.

ACOs focus on the need for proactive andeffective coordination across all levels andtypes of healthcare services,extending roles andresponsibilities beyondtraditional care delivery.Nurses are well suited for

expanded roles, which caninclude:Care coordinator/managerDisease managerResource coordinatorSupport for psycho-socialneedsHealth coachCommunity outreachInformation analystProcess managerDischarge/transition plannerData analyst

Nurses work in a variety

of organizations involved withACOs: practitioner ofces andclinics, hospitals, insurers, andcommunity health organizations. As a result,they are often in positions to address improvingcare delivery and coordination across manysettings and types of care. From concept to accountable caremanagement ACOs tailor programs to enhance efciencyand quality. Well-designed analytics are criticalto setting goals, improving outcomes, andassessing downstream measures of progress.ACOs must audit the resources of all

participating entities and develop anunderstanding of specic resources.Nurses can use population analysis to play a

role in identifying members who will be wellserved by ACO programs. As new clinicalworkows and business processes are designed,nurses can identify gaps that patients might fallthrough. And nurses are particularly well suitedin reaching out to members who would benetfrom new ACO programs.

Improving efciency through quality ACOs seek to incentivize appropriatebehavior and more efcient use of resources,

such as preventive care. Nurses are positionedwell to take an active role, for instance as casmanagers, where they can bring together a raof disciplines and resources across a number entities.

Community Care of North Carolina is apublic-private partnership between the state a14 local nonprot networks encompassing 3,5

physicians and 750,000Medicaid and ChildrensHealth Insurance Programrecipients. Its informationsystems enable case

managers to track healthcutilization, document carand communicate with ocase managers, saving NoCarolina an estimated $1million annually. The Boeing Companycreated the IntensiveOutpatient Care Programpilot program in Seattle themploys predictive modeto help the program focusthe highest-risk patients. Trole of nurses was key to

success. The program has nbeen adopted by Regence BlShield in Seattle and is in plan

stages to be expanded to other states.Taking nursing professionals to a new leve

As the ACO model appears to be gainingtraction, the evolving roles of nurses are synchup well with the skills that ACOs demand. Manurses are moving into roles that focus on:Health and wellnessCoaching and behavior modicationCoordinating psycho-social needsBusiness and nancial managementPopulation analysis and management strateg

Because this coordinated approach to careoften demands new skill sets and a willingnesadapt to new challenges, we may begin to seeevolution of development opportunities withinnursing community. Professional schools mayincorporate training such as care coordinationand data analysis in their nursing curricula tobetter prepare students for more strategic roleACOs.

OPINION

Nurses Have a Role in ACO PlansNew Model of Care Delivery is Tailored to Their Skill

Patty Jones, R.N., is a management consult

with Milliman in Seattle.

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MARKETPLACE/EMPLOYMENTPayers & Providers Page 5

EXECUTIVE DIRECTOR, CARE DELIVERY INNOVATION

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The Executive Director, Care Delivery Innovation is a newly created position housed within the StrategicServices Division of BCBSA. Strategic Business Services works with Member Blue Plans to develop business

solutions through strategic business relationships that strengthen the competitive position of the Blues. Foradditional information on BCBSA, please visit their website at www.bcbs.com.

Reporting directly to the Vice President, Strategic Business Services, the Executive Director, is responsible forproviding leadership, strategic direction and actionable solutions in support of the imperative to transformcare delivery in the United States to ensure a long term sustainable/viable health care system. The ExecutiveDirector manages ongoing market assessments, integration and synthesis of care delivery activities tosupplement Plan thinking and evolution of their alternative approaches. The Executive Director has threedirect reports and a total staff of seven.

The successful candidate must have a Masters degree. A minimum of 15 years of broad-based care deliveryexperience at the executive level in a large, sophisticated integrated delivery system, health plan, or healthsystem with a strong provider orientation is required. He/she must possess high standards of excellence and a

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Payers & Providers Midwest Edition – Issue of July 19, 2011

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