Obama Administration Refuses To Identify Troubled Healthcare Co-Ops

Federal officials refuse to identify the troubled Obamacare health co-ops that the Centers for Medicare and Medicaid Services has placed in a special risk category requiring “enhanced oversight” due to low profitability or low enrollment.

Last week the inspector general for the Department of Health and Human Services revealed that 22 of the 23 non-profit co-ops suffered net operating losses last year and that six were so distressed CMS said they were the subject to extra “enhanced oversight.”

CMS spokesman Aaron Albright, however, refused to divulge the names of the struggling taxpayer-supported co-ops.

He suggested The Daily Caller News Foundation file a Freedom of Information Act request. It’s not uncommon for responses to FOIA requests to take months or even years to be processed by federal departments and agencies.

The secrecy surrounding the identity of the six ailing co-ops is not sitting well with government watchdog groups.

“Taxpayers deserve to know when any sort of taxpayer-funded entity is failing,” said David Williams, president of the Taxpayer Protection Alliance. “Taxpayers need to know the success or failure of those co-ops. We have to name names.”

“Certainly, the government should be identifying co-ops that are at risk,” noted Scott Amey, the general counsel for the non-partisan Project on Government Oversight. “The government seems to be just trying to bury its head in the sand.”

Department of Health and Human Services IG Daniel Levinson was the first to report that six co-ops were in a special risk category within CMS.

“CMS recently placed four CO-OPs on enhanced oversight or corrective action plans and two CO-OPs on low-enrollment warning notifications,” he revealed in his July 30 report.

Levinson further criticized CMS officials, noting that the Obamacare program was now in its third year of existence, yet, “CMS had not established guidelines or criteria to assess whether a CO-OP was viable or sustainable.”

Levinson painted a dismal national picture of the Obamacare health co-ops, noting they were suffering from cash shortages and that their enrollment numbers were “considerably lower than the CO-OPs’ initial annual projections.”

Sparse enrollments could imperil most of the non-profit co-ops that were originally designed to compete with traditional health insurance companies.

“The low enrollments and net losses might limit the ability of some CO-OPs to repay startup and solvency loans and to remain viable and sustainable,” Levinson said.

About $2 billion have been issued in start-up and solvency loans under Obamacare.

Rating agency Standard and Poor’s last February identified 10 co-ops that failed to enroll 6,000 or fewer customers through the third quarter of last year.

Those low enrollment co-ops are operating in Illinois, Massachusetts, Ohio, Connecticut, Arizona, Tennessee, Michigan, Maryland and two in Oregon.

In that report, S&P optimistically claimed that one co-op, operating in Iowa and Nebraska, called Co-Opportunity Health, had enrolled 91,000 customers.

But Co-Opportunity abruptly closed its doors last December and by February the state had liquidated it.

At the time, the Iowa co-op suffered $163 million in operating losses, according to the Iowa insurance commissioner. CMS originally awarded $145 million under Obamacare.

Likewise, S&P also reported that the Louisiana Health CO-OP had successfully enrolled 11,771 customers.

But last month the co-op announced it was shuttering its doors by the end of the year. CMS had loaned that co-op $66 million.

Similar to the experiences reported in Iowa and Louisiana, most of the non-profit health co-ops have been burning through their federal loans at an alarming rate, according to financial reporting agencies.

Insurance ratings firm A.M. Best warned in January that as of Sept. 30, 2014, “the ratio of surplus notes outstanding to capital and surplus exceeded 100% for all of the co-ops.”

A Standard & Poor’s Report on the co-ops reported that the worst performing co-ops that were burning through their existing capital were in Illinois, Arizona, Colorado, Nevada and Maryland.

Thomas Miller of the American Enterprise Institute and Grace-Marie Turner, the president of the free market Galen Institute reported that net losses for all the co-ops amounted to $614 million in 2014.

Last year CMS announced that it was replenishing some co-op cash with emergency “solvency loans.”

Five Obamacare health insurance co-ops in Connecticut, Kentucky, Maine, New York and Wisconsin received solvency loans in 2014 amounting to $322 million.

Via: Daily Caller

Continue Reading....

Obama’s Nominee to Head Medicare, Medicaid Agency Faces Questions of Cronyism

An Obama administration official who faces questions surrounding potential conflicts of interest due to his work in the medical services field has been nominated to serve as head of the agency tasked with overseeing Obamacare.

The White House announced yesterday Andy Slavitt’s nomination to permanently head the Centers for Medicare and Medicaid Services. Slavitt began working as the agency’s acting administrator after Marilyn Tavenner resigned in January.

The Centers for Medicare and Medicaid Services, an agency within the Department of Health and Human Services, oversees Obamacare and the federal exchange, HealthCare.gov. Slavitt joined the Obama administration in June 2014 as principal deputy administrator at the Centers for Medicare and Medicaid Services.

His appointment to the post was met with skepticism from Republicans in the House and Senate, as Slavitt worked as group vice president of OptumInsight/QSSI, a technology company, before taking the No. 2 post at the Centers for Medicare and Medicaid Services.

The Department of Health and Human Services awarded Maryland-based OptumInsight/QSSI with a contract to build the federal data hub, part of HealthCare.gov, in January 2012.

Then, following the federal exchange’s disastrous launch in October 2013, OptumInsight/QSSI was tasked with fixing the broken website and continued to serve as a “senior adviser” on the project.

>>> Company That ‘Saved’ HealthCare.gov Faces Questions of Cronyism

OptumInsight/QSSI is the sister company of UnitedHealthcare, a health insurance provider that offers plans on both the federal and state-run exchanges. Both companies are subsidiaries of UnitedHealth Group.

Typically, government officials who leave the private sector for jobs in the administration must wait at least one year before working with their previous employer. However, Slavitt received an ethics waiver from the White House last year, which allowed him to begin working on matters involving OptumInsight/QSSI, his former company.

Via: Daily Signal

Continue Reading....

CMS’ Secretive Settlement $1.3 billion in improper hospital claims paid out

The Center for Medicare and Medicaid Services secretly paid out over a billion dollars in improper hospital claims earlier last month, despite auditors labeling them unnecessary previously.

The payments, which were quietly announced on June 1 by CMS, totaled $1.3 billion and involved 1,900 hospitals and 300,000 claims that had been already denied by CMS auditors on two different levels as medically unnecessary.

The Department of Health and Human Services Office of Medicare Hearings and Appeals settled hundreds of thousands of appeals for 68 cents on the dollar. The money used to cover the claims will be taken from the Medicare Trust Fund. The hospitals that received the settlements were also not announced by CMS.

Citizens Against Government Waste, a nonpartisan organization dedicated to eliminating waste, fraud, mismanagement, and abuse in government, first noticed the payments.

The group says the process has been questionable from the beginning, with a majority of the claims related to short impatient stays—an area considered extremely vulnerable to improper payments.

“The settlement process was murky from its inception. On August 29, 2014, CMS announced the global financial settlement for hundreds of thousands of Medicare fee-for-service claims that had been denied twice and then appealed by providers to the third level of appeals, the administrative law judges (ALJ),” CAGW wrote. “The vast majority of these claims were related to short inpatient hospital stays (an area that had been identified by CMS as highly vulnerable to improper payments), and had been denied at two lower levels, including by Recovery Audit Contractors (RACs).”

Office of Medicare Hearings and Appeals Chief ALJ Nancy Griswold testified in April before Congress about the drastic jump in OMHA’s workload.

During the testimony before the Senate Finance Committee, Griswold said between fiscal year 2009 and fiscal year 2014, the workload within the office increased by 543 percent. Additionally, the number of appeals OMHA received jumped from 384,000 in fiscal year 2013 to 474,000 appeals during fiscal year 2014.

Via: Free Beacon

Continue Reading....

Feds Can’t Verify $2.8 Billion in Obamacare Subsidies

CMS does not know if subsidies went to ‘confirmed enrollees, in the correct amounts’

The federal government cannot verify nearly $3 billion in subsidies distributed through Obamacare, putting significant taxpayer funding “at risk,” according to a new audit report.

The Department of Health and Human Services (HHS) Office of Inspector General (OIG) released an audit Tuesday finding that the agency did not have an internal system to ensure that subsidies went to the right enrollees, or in the correct amounts.

“[The Centers for Medicare and Medicaid Services] CMS’s internal controls did not effectively ensure the accuracy of nearly $2.8 billion in aggregate financial assistance payments made to insurance companies under the Affordable Care Act during the first four months that these payments were made,” the OIG said.

“CMS’s system of internal controls could not ensure that CMS made correct financial assistance payments,” they said.

The OIG reviewed subsidies paid to insurance companies between January and April 2014. The audit found that CMS did not have a process to “prevent or detect any possible substantial errors” in subsidy payments.

The OIG said the agency did not have a system to “ensure that financial assistance payments were made on behalf of confirmed enrollees and in the correct amounts.”

In addition, CMS relied too heavily on data from health insurance companies and had no system for state-based exchanges to “submit enrollee eligibility data for financial assistance payments.”

The government does “not plan to perform a timely reconciliation” of the $2.8 billion in subsidies.

The audit was released as the country awaits a Supreme Court ruling that could make all federal subsidies invalid, since the majority of states did not set up their own health insurance exchange.

Via: WFB

Continue Reading......

The Next Shoe To Drop: Obamacare Will Increase The Cost Of Employer-Sponsored Insurance

Yesterday, the Obama Administration’s Centers for Medicare and Medicaid Services released a six-page report predicting that Obamacare could cause premiums to increase for nearly two-thirds of small- to medium-sized businesses. “This results in roughly 11 million individuals whose premiums are estimated to be higher as a result of the ACA and about 6 million individuals who are estimated to have lower premiums,” CMS writes. But CMS’ projections almost certainly understate the problem, one that will begin to affect millions of workers in the second half of 2014.

CMS: 11 million will see increased premiums

The CMS premium report was a requirement imposed by Congress on the administration under the Department of Defense and Full-Year Continuing Appropriations Act of 2011. That law mandated that CMS “provide an estimate of the number individuals and families who will experience a premium increase and the number who will see a decrease” as a result of the Affordable Care Act.

But CMS only looked at one cost-increasing Obamacare provision:community rating. And they only looked at it for individuals employed by businesses with less than 100 employees: what’s called the “small group market.”

Here’s the background. Under Obamacare, all regulated insurance plans are required to charge people the same premium, regardless of health status. Insurers can charge different rates based on age (but only within a narrow range); tobacco use (smokers can be charged 50 percent more than non-smokers); geographic area (insurers can charge people different rates based on regional demographic variation); and whether the plan is for a single individual or a family.

Via: Forbes

Continue Reading.....

Feds Release Details of ‘Urgent’ New Healthcare.gov Contract

Newly released documents reveal the anxieties of the Department of Health and Human Services (HHS) about Healthcare.gov, which warn that failure to finish the website puts “the entire health insurance industry at risk.”

The HHS released documents relating to its new contract to maintain the federal health exchange on Wednesday, justifying its reasons to expedite the procurement process because of an “urgent need” for the website to work.

The documents instruct the new contractor, Accenture Federal Services, to build “core functionality” of the website, including software that tracks enrollment and calculates subsidies to pay insurance companies. Centers for Medicare and Medicaid Services (CMS) officials have admitted that nearly half of the site has yet to be built.

CMS officials said the majority of work remains to be done on back end systems, including the financial management module, which will automate and smooth intersections with third parties including health plans.

HHS warned that if the site is not completed by March 2014, it puts the “entire health insurance industry at risk.”

“CMS must immediately award a contract for these services under the auspices of the aforementioned exception to full and open competition because there is limited time to build this functionality and failure to deliver the functionality above by mid-March 2014 will result in financial harm to the Government,” the “Justification for Other than Full and Open Competition” statement accompanying the contract revealed.

“If this functionality is not complete by mid-March 2014, the government could make erroneous payments to providers and insurers,” it said.

Via: WFB

Continue Reading.....

Video: Big rush on ObamaCare, but how many will be insured?

As anyone could have predicted, the deadline for ObamaCare enrollment has prompted a surge in traffic to Healthcare.gov and state exchange websites. Mandate compliance will tend to focus attention, especially when the IRS could end up breathing down your neck for non-compliance. CBS News reports that record numbers of people signed up for insurance on the exchanges over the past week, but no one’s really sure if they actually will have insurance after January 1:

CBS calls these “enrollments,” but that’s actually the question. As CBS notes, insurers aren’t sure that the sign-ups will equate to actual enrollments for a number of reasons. Two of those reasons don’t get a mention in the report. First, the federal exchange and perhaps some of the state exchanges still have issues with their 834s, the electronic report that transmits enrollment data to insurers. The failure rate, by the administration’s own admission, is at least 10%. If the insurers don’t get the proper data, then they can’t enroll the customers. Second, the back-end subsidy payment system isn’t even in place, although the Obama administration’s workaround will be to have the insurers bill CMS for subsidy payments and to issue them without confirmation for a while. If enrollment data gets confused, customers might find their insurance cancelled even if they have been making their partial payments — unless insurers really want to go out on a limb and into the red on provider payments with short revenue.

Via: Hot Air

Continue Reading....

CBS: Top ObamaCare official wanted site shut down over security risks — and was overruled

It’s not as if HHS wasn’t aware of concerns over security for the ObamaCare exchange they launched.  Dozens of Attorneys General issued public warnings over the summer about the lack of security in a system that would contain the most private identity information of any web portal ever. Their own Inspector General blasted the contractors working on the site in June for their performance on security.

Still, HHS rolled out the site even with those gaps unaddressed, putting millions of Americans at risk for identity theft — but the news gets worse.  CBS News’ Sharyl Attkisson reports this morning that a top official in the ObamaCare exchange told Congress on Tuesday that HHS discovered two more big security issues that no one detected before the rollout:

A top HealthCare.gov security officer told Congress there have been two, serious high-risk findings since the website’s launch, including one on Monday of this week, CBS News has learned.

Teresa Fryer, the chief information security officer for the Centers for Medicare and Medicaid Services (CMS), revealed the findings when she was interviewed Tuesday behind closed doors by House Oversight Committee officials. The security risks were not previously disclosed to members of Congress or the public. Obama administration officials have firmly insisted there’s no reason for any concern regarding the website’s security. …

Details are not being made public for security reasons but Fryer testified that one vulnerability in the system was discovered during testing last week related to an incident reported in November. She says that as a result, the government has shut down functionality in the vulnerable part of the system. Fryer said the other high-risk finding was discovered Monday.

Via: Hot Air
Continue Reading....