Obamacare is putting a big crimp in Wal-Mart’s lucrative pharmacy business

It was not an especially good quarter for Wal-Mart, and one pain point that will continue to hurt the company is a downturn in its large in-store pharmacy business in the US. On a media call yesterday (Aug. 18), executives in part blamed the company’s reduced profit outlook on a change in the way Americans are paying for drugs.

“We are seeing less cash and more reimbursements from insurers,” CFO Charles Holley said.

In other words, the rapid fall in uninsured Americans after passage of the Affordable Care Act has led to more drugs being paid for by insurers, and fewer being paid out of pocket. That squeezes profit margins, particularly for a company like Wal-Mart with one of the biggest drug stores in the country (it brings in about $19 billion in annual revenue).

In the US, full retail prices paid by the uninsured are substantially inflated compared to what private insurers reimburse. Unlike the average healthcare consumer, private insurers know the market, whether generic or cheaper options are available, and they have the leverage of scale to negotiate prices.

Government programs like Medicare and Medicaid, which cover many Wal-Mart customers, are prohibited from negotiating on price with drug makers. But they are also legally required to only reimburse the drug maker a certain percentage over the average wholesale price.

Pharmacy benefit managers, which administer drug benefits for employers and insurers, have also consolidated (pdf), leaving three firms (ExpressScripts, CVS, and UnitedHealth) to cover most Americans. The bump in scale has boosted their negotiating power on drug prices.

Formerly uninsured Wal-Mart customers are also likely to be entering into lower-tier health insurance plans that don’t cover an ever-growing list of expensive drugs, instead favoring cheaper, clinically-equivalent alternatives.

Pharmacies that have overcome these changes, like CVS, have tended to focus on offering expensive and often high-margin specialty drugs that require extra service to administer (such as chemotherapy drugs and arthritis drugs).

Wal-Mart says it has no intention of selling off its pharmacy business. As for solutions, on its Aug. 18 earnings call it offered up only that it is taking a “number of actions to lessen the impact.”

Via: Quartz.com

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Under Obamacare, Uninsured Rate Fell to Lowest Level in 50 Years. Why There’s More to That Number.

Nearly two years after Obamacare’s implementation, a new survey found that the number of uninsured Americans decreased to less than 10 percent of the population in the first three months of 2015, which is the lowest level in the survey’s 50-year history. 

However, experts say the change could be mostly attributed to the Obama administration’s expansion of Medicaid.

According to the survey from the National Center for Health Statistics, a division of the Centers for Disease Control, the number of people who were uninsured declined from 36 million in 2014 to 29 million in the first three months of 2015. Among adults between the ages of 18 and 64, the percentage of those who were uninsured dropped from 16.3 percent in 2014 to 13 percent in 2015’s first quarter.

The changes to the rate of uninsured come nearly two years after Obamacare’s implementation, which went into effect October 2013.

While the drop speaks to the mission of the health care law, Ed Haislmaier, a health policy expert, pointed to outside factors that affect the decrease in the number of uninsured Americans.

In an interview with The Daily Signal, Haislmaier, a senior research fellow in health policy at The Heritage Foundation, said that though it’s likely the Obama administration was likely “in the ballpark” for the changes in the number of uninsured, the survey had limitations.

Primarily, the government relied on answers from 26,121 respondents as opposed to an actual count, such as the number of people enrolled in health coverage, data that can be provided by health insurance companies.

“They’re trying to say how many people didn’t have coverage and extrapolate from that,” Haislmaier said.

Most notably, though, the survey failed to address an increase to the Medicaid rolls, which stemmed from Medicaid expansion created under Obamacare.

According to Haislmaier, Medicaid enrollment from January 2014 to March 2015 went from approximately 60.9 million to 71 million.

Via: Daily Signal

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Obama’s Top Health Care Nominee Was Once Embroiled in Medical Fraud Case

Andy Slavitt — President Obama’s choice to manage Obamacare, Medicare and Medicaid — was linked seven years ago to a massive medical data fraud scheme that resulted in what was then the largest settlement ever by an insurance company.

If he is confirmed by the Senate, Slavitt will head the Centers for Medicare and Medicaid, which manages the federal government’s three biggest health care programs. He will manage an estimated $1 trillion in benefits that are paid to millions of doctors, patients and hospitals.

Slavitt was CEO of Ingenix, a health data analytics firm at the center of a $50 million settlement in 2009 with then-New York Attorney General Andrew Cuomo and a $350 million settlement with the American Medical Association.

Cuomo and the AMA charged that Ingenix supplied databases to insurance companies that fraudulently calculated reimbursements for out-of-network medical services provided to policyholders, according to a Daily Caller News Foundation investigation.

Ingenix was owned by UnitedHealth Group, which did not admit to any criminal wrong-doing in the settlements.

The Ingenix scandal became public in February 2008 when Cuomo filed a “notice of intent to sue” Ingenix and UnitedHealth Group for “rigged” reimbursement rates that forced patients to overpay up to 30 percent for out-of-network doctors and hospitals.

Cuomo charged that Ingenix was running a “scheme” that sought “to defraud consumers by manipulating reimbursement rates.”

The AG told reporters, “This involves fraud in the hundreds of millions of dollars, affecting thousands and thousands of families. Too many people have been hurt. It has to stop.”

It was estimated that years of data manipulation by Ingenix affected as many as 110 million Americans — about one in three patients — who used doctors, labs or hospitals that were out of their insurance network.

Cuomo, who is now New York’s Democratic governor, estimated that patients who used out-of-network providers received between 10 to 28 percent less than they were entitled to because of Ingenix’s flawed data.

The $350 million was to reimburse doctors and patients shortchanged by Slavitt’s company. The $50 million went to establish a database of physician charges to be administered independently by a university. Ingenix also agreed to shutter its entire medical data analytics department.

Via: Daily Caller

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[VIDEO] Obama Weekly Address, Saturday August 1, 2015

Weekly Address: Celebrating Fifty Years of Medicare and Medicaid

WASHINGTON, DC — In this week's address, the President celebrated the fiftieth birthdays of Medicare and Medicaid, which together have allowed millions to live longer and better lives. These programs are a promise that if we work hard, and play by the rules, we’ll be rewarded with a basic measure of dignity, security, and the freedom to live our lives as we want. Every American deserves the sense of safety and security that comes with health insurance. That’s why the President signed the Affordable Care Act, and that’s why he will continue to work to ensure that Medicare and Medicaid, programs that are fundamental to our way of life, stay strong.

The audio of the address and video of the address will be available online atwww.whitehouse.gov at 6:00 a.m. ET, August 1, 2015.

Via: WhiteHouse.gov

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Staying Covered: Immigrants Contributed Near $200-Billion Surplus to Medicare

Via: You Tube

50 Years of Dysfunction: The Failures of Medicare and Medicaid

Fifty years ago, on July 30, 1965, President Lyndon B. Johnson signed legislation creating the nation’s two largest federal health entitlements, Medicare and Medicaid.

Medicare was created as a social insurance program for seniors and those with disabilities. It is financed primarily by payroll taxes collected during a recipients working life, and secondarily by personal and business income taxes.

Medicaid was designed as a welfare program to provide health care services to vulnerable low income groups. Medicaid is jointly financed by federal and state governments.

>>> On Thursday, the Heritage Foundation and the American Enterprise Institute are hosting an event with leading experts to reflect on the past 50 years and look ahead to the next. Details here.

Unfortunately at the age of 50, both Medicare and Medicaid continue to suffer from problems inherent to their structure and organization.

For example both programs:

• Limit choice
• Are overly bureaucratic and slow to change
• Suffer from crucial gaps in coverage and inefficient pricing
• Are plagued with losses through waste, fraud and abuse

Medicare is the largest purchaser of health care in the nation, covering roughly 55 million persons.

The Congressional Budget Office (CBO) estimates Medicare’s total annual cost at $615 billion in 2015 and it is scheduled to exceed $1 trillion by 2023.

In other words, over the next 75 years American seniors are expecting tens of trillions of dollars of Medicare benefits that are not paid for. Today, working taxpayers, mostly through business and personal income taxes, fund an estimated 86 percent of the program’s annual cost.

For Medicaid, the Centers for Medicaid and Medicare Services (CMS) Office of the Actuary estimates that Medicaid’s total (federal and state combined) spending is expected to reach $529 billion in 2015, with 68.9 million enrollees.

Fifty years later, in their July 22, 2015 memo to Senate Budget Committee staff Medicare’s Office of the Actuary reports that Medicare’s debt – the program’s long-term unfunded liability- ranges from $27.9 to $36.8 trillion.

Whether it’s the lower or higher debt number, this year’s estimates are worse than last year’s by more than a $1 trillion.

For Medicaid, cost and enrollment is expected to continue to grow, in particular due to the expansion of the program under the Affordable Care Act.

By 2023, total Medicaid spending is projected to climb to $835 billion and enrollment will near 80 million.

The President’s answer is to cut Medicare payments to medical professionals and institutions.

Under Obamacare, the Medicare Trustees warn,

“By 2040, approximately half of hospitals, 70 percent of skilled nursing facilities and 90 percent of home health agencies would have negative total facility margins, ” adding that this creates the “possibility of access and quality of care issues for Medicare beneficiaries.”

For Medicaid, access and quality of care is already a top concern.

A recent CDC study found that only 68.9 percent of physicians would accept new Medicaid patients.

For the next 50 years, Congress could initiate transformative changes through a defined contribution ( “premium support”) financing in both programs, giving patients direct control over the flow of health care dollars and compelling health plans and providers to compete for patients’ dollars on a level playing field.

Intense competition among health plans and providers would stimulate innovation in benefit design and care delivery, improve patient outcomes and enhance patient satisfaction, and save serious money for both seniors and taxpayers alike.

Via: The Daily Signal

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Thousands ruled ineligible for Mass. Medicaid

BOSTON (AP) — Tens of thousands of people have been removed from the state's Medicaid program during the first phase of an eligibility review, according to figures from Gov. Charlie Baker's administration obtained by The Associated Press.

The eligibility checks, required annually under federal law but not performed in Massachusetts since 2013, began earlier this year as part of Baker's plan to squeeze $761 million in savings from MassHealth, the government-run health insurance program for about 1.7 million poor and disabled residents.

At $15.3 billion, MassHealth is the state's single largest budget expense.

Based on the results of the redetermination process so far, the state was on track to achieve the savings it had hoped for in the current fiscal year without cutting benefits for eligible recipients, said Secretary of Health and Human Services Marylou Sudders.

The first phase of the process involved letters sent to 503,286 Medicaid recipients over the first six months of the calendar year notifying them of the need to reapply for benefits, according to numbers provided to the AP by the Executive Office of Health and Human Services.

Final figures were not expected until Aug. 1, but of the nearly 293,000 applications processed through late June, 78 percent remained eligible for Medicaid based on income. Of those deemed ineligible, the majority will have access to subsidized private insurance through the state's health connector, though about 5 percent, according to Sudders, would not qualify for subsidized coverage.

The results of the eligibility redeterminations to date, Sudders said, were in line with the typical rate of change in the Medicaid population and she did not believe it had deprived deserving residents of coverage.

Via: The Herald News

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Social Security disability program to go bust in 2016

The Social Security disability program will run out of money in late 2016, a report issued Wednesday by the Social Security and Medicare trustees warned.

At that point, the 10.9 million beneficiaries of the program face an immediate 19 percent cut in benefits, unless Congress intervenes.

The combined trust fund for the retirement and disability programs is projected to run out by 2034, a slight improvement from last year's estimate.

The trust fund for Medicare hospital insurance will be depleted by 2030, unchanged from last year.

The new figures were published Wednesday as part of the annual update on the programs' finances from the Social Security and Medicare trustees.

Federal retirement programs face long-term fiscal problems largely because of demographics. Demographers expect that the number of retirees claiming Social Security benefits will rise from less than 50 million today to 71 million by the time the baby boomers are done retiring in 2029. The ranks of Medicare beneficiaries will grow from 56 million to 80 million.

The more immediate deadline, however, relates to the disability program, which provides income security for disabled workers, widows and widowers, and children.

Disability payments could be assured if Congress were to shift incoming payroll tax revenues in between the retirement and disability trust funds, as it has done in the past. President Obama supports such a change. Congressional Republicans, however, have said that they are not interested in redirecting revenues to the disability trust fund without addressing the underlying fiscal problems.

The Social Security retirement program, on the other hand, is set to see its trust fund exhausted in 2035, one year later than previously estimated. At that point, it would only be able to pay 77 percent of scheduled benefits.

Via: Washington Examiner

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Obamacare’s Enrollment Increase: Mainly Due to Medicaid Expansion

Abstract

Health insurance enrollment data show that the number of Americans with private health insurance coverage increased by a bit less than 2.5 million in the first half of 2014. While enrollment in individual market coverage grew by almost 6.3 million, 61 percent of that gain was offset by a reduction of nearly 3.8 million individuals with employer-sponsored coverage. During the same period, Medicaid enrollment increased by almost 6.1 million—principally as a result of Obamacare expanding eligibility to able-bodied, working-age adults. Consequently, 71 percent of the combined increase in health insurance coverage during the first half of 2014 was attributable to 25 states and the District of Columbia adopting the Obamacare Medicaid expansion.

W‌ith enrollment data now available for the second quarter ‌of 2014, it is possible to construct a complete picture of the changes in health insurance coverage that occurred during the initial implementation of the Patient Protection and Affordable Care Act (PPACA), commonly known as Obamacare. The data show that in the first half of 2014, private health insurance enrollment increased by a net of 2,465,586 individuals. That net figure reflects the fact that 61 percent of the gain in individual coverage was offset by a drop in employer group coverage. During the same period, Medicaid enrollment grew by 6,072,651 individuals. Thus, while a total of 8.5 million individuals gained coverage, 71 percent of that net coverage gain was attributable to the Obamacare expansion of Medicaid to able-bodied, working-age adults.

 

Changes in Private Coverage Enrollment

Health insurers file quarterly reports with state regulators, and data from those reports for the second quarter of 2014 are now available.[1] The three relevant market subsets for this analysis are (1) the individual market, (2) the fully insured employer-group market, and the (3) self-insured employer-group market.[2] Table 1 shows the changes in private health insurance enrollment during the first and second quarters of 2014, along with the net changes for the combined six-month period.

Obamacare’s initial open enrollment period began on October 1, 2013, and officially ended on March 31, 2014—though in a number of states it was extended into April to give those who had experienced problems enrolling additional time to complete the process. Because enrollment was for the 2014 plan year, the coverage for those who enrolled during the fourth quarter of 2013 took effect in the new year; thus, those individuals are included in the data for the first quarter (Q1) of 2014. The data for Q2 2014 captures enrollments that occurred during the last two months of the open enrollment period, or which were otherwise delayed due to the numerous problems experienced by the exchanges, and so did not take effect until after the end of the first quarter.

The data show that enrollment in individual market coverage increased by over 2.7 million individuals in Q1 2014 and by a further 3.5 million individuals in Q2. Thus, for the first half of 2014, enrollment in individual market coverage grew by almost 6.3 million individuals.

The second-biggest coverage change that occurred during the first half of 2014 was the decline in the number of individuals with coverage through fully insured employer group plans. Enrollment in such plans dropped by 3.8 million individuals in Q1 2014, and by nearly a million more individuals in Q2 2014. Thus, for the first half of 2014, the number of individuals with coverage through a fully insured employer group plan decreased by nearly 4.8 million.

Enrollment in self-insured employer plans modestly increased in both quarters—by 347,000 in Q1 2014, and by about 652,000 in Q2—for a net enrollment gain of a little less than one million during the first half of 2014. Consequently, the combined enrollment changes in the two segments of the employer group market during the first half of 2014 produced a net decrease of almost 3.8 million in the number of Americans covered by employer-sponsored plans.

That net reduction in employer-sponsored group coverage is explained by employers discontinuing coverage for some or all of their workers or, in some cases, individuals losing access to such coverage due to employment changes. While it is not possible to determine from the data the subsequent coverage status of individuals who lost group coverage, there are only four possibilities: (1) some obtained replacement individual-market coverage (either on or off the exchanges); (2) some enrolled in Medicaid; (3) some enrolled in other coverage for which they are eligible (such as a plan offered by their new employer, a spouse’s plan, a parent’s policy, or Medicare); and (4) some became uninsured.

 

If individuals lost group coverage, but obtained new coverage under either another employer group plan or one in the individual market, they would then be counted in the enrollment figures for those submarkets. Similarly, if individuals transitioned to Medicaid, they would be counted in the Medicaid enrollment figures reported by the Centers for Medicare and Medicaid Services (CMS).

Via: Heritage

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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

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House Dems want Medicaid to cover abortion

House Democrats are renewing their attack on the Hyde Amendment, the controversial budget provision that bars federal funds from paying for abortions.

Reps. Barbara Lee (D-Calif.), Diana DeGette (D-Col.) and Jan Schakowsky (D-Ill.) introduced a bill Wednesday that would require Medicaid to cover abortion services – currently banned under the Hyde Amendment.

The legislation, the Equal Access to Abortion Coverage in Health Insurance Woman Act, is backed by dozens of women's health groups, who say it will help reduce unplanned pregnancies. About 65 lawmakers have signed on as co-sponsors.

Under current law, women enrolled in Medicaid, the government’s low-income insurance program, are not covered for abortion. The Hyde Amendment, though not part of a permanent law, has been attached to appropriations bills since 1976.

The bill was unveiled Wednesday at a packed press conference at the House Triangle, where dozens of supporters gathered with posters.

“Henry Hyde and others said, 'Well if we can’t stop people from making their own moral decisions ... we will do it financially. Through the Hyde Amendment, we will say to low income women, you can’t use your health insurance for abortions because we say it’s wrong,'” Rep. Jerrold Nadler (D-N.Y.) told the crowd.

"Today we are fighting back against that moral arrogance."

The effort to undermine the Hyde Amendment has been led by a coalition called All Above All, which includes Planned Parenthood and the American Civil Liberties Union. 

“For far too long, this country has penalized low-income women seeking abortion — forcing those who have the least to pay the most in order to access safe, legal care,” Cecile Richards, president of the Planned Parenthood Action Fund, wrote in a statement Wednesday.

About 56 percent of voters support the bill, according to the group’s polling.

Via: The Hill

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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

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Huckabee: SCOTUS Obamacare Decision ‘Out-of-Control Act of Judicial Tyranny’

As soon as the news of the King v. Burwell decision broke, 2016 GOP candidate Mike Huckabee published his reaction on his official blog. And just in case not enough people were paying attention, he decided to get a little ranty on Twitter as well.

The first indication of Huckabee’s impending opinion came in the form of a 139-character attack on the current Supreme Court justices and the judicial branch at large.

 

Gov. Mike HuckabeeVerified account‏@GovMikeHuckabee

There isn't a 'do-over’ provision in our Constitution that allows unelected, SCOTUS judges power to circumvent Congress & rewrite bad laws.

• RETWEETS64
• FAVORITES46
• 

7:24 AM - 25 Jun 2015

Of course, his “do-over” jab wasn’t going to be enough, so he wrote a much longer blog post about it. From the very beginning, Huckabee makes his stance clear when he calls the King v. Burwell decision “an out-of-control act of judicial tyranny.” He then spends the rest of the first paragraph nit-picking the SCOTUS’s announcement, but quickly leaves it behind for a second paragraph filled with a “what I will fix as president” campaign message:

Everywhere I go, I talk to American families who keep getting punched in the gut with outrageous insurance premiums and infuriating hospital bills. ObamaCare was railroaded through Congress to ‘solve’ our healthcare problems, but five years later, American families are getting railroaded by runaway mandates, big government bureaucracy, and out-of-control healthcare costs. ObamaCare is a $2.2 trillion Washington disaster that raided billions from Medicare and did nothing to fix our broken system of ‘sick care,’ which rewards irresponsibility and penalizes commonsense.  As President, I will protect Medicare, repeal ObamaCare, and pass real reform that will actually lower costs, while focusing on cures and prevention rather than intervention. The status quo is unfair, unaffordable, unsustainable, and completely un-American.

But this is all part of a campaign, so of course the Huckster wasn’t done.

 

Gov. Mike HuckabeeVerified account‏@GovMikeHuckabee

#SCOTUS has NO authority to rescue Congress from creating bad law. #Burwell ruling is an out-of-control act of judicial tyranny. #ObamaCare

• RETWEETS66
• FAVORITES58
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7:56 AM - 25 Jun 2015

Not gonna lie. I kind of miss Fox News’ Huckabee. Kind of.

Via: Mediaite

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