While the attention lately has focused on individual policies, if you get your insurance from your employer, there’s a good chance that you are in a grandfathered plan, and that means some of the changes the law requires do not affect you — yet. More than a third of all Americans who get insurance through their jobs are enrolled in such plans, although that number is expected to decline every year.

Consumers should know the status of their plans since that may determine whether they are eligible for certain protections and benefits created by the health law.  For example, an employee at a large company may wonder why his job-based insurance doesn’t include the free preventive services he’s heard about. To answer questions like that, you must understand the status of your plan and how grandfathering works.  Here are the basics:

What is a grandfathered plan?

Most health insurance plans that existed on March 23, 2010 are eligible for grandfathered and therefore do not have to meet all the requirements of the health care law.  But if an insurer or employer makes significant changes to a plan’s benefits or how much members pay through premiums, copays or deductibles, then the plan loses that status. 

The government’s spell out how much plans can change the amount paid by workers or employers before losing their status.

Both individual plans, the kind you buy on your own, and group plans, the kind you receive through an employer, can be grandfathered. If you get coverage through an employer, you can join a grandfathered plan even if you weren’t enrolled on March 23, 2010.

What rules does a grandfathered plan have to follow?

A grandfathered plan has to follow some of the same rules other plans do under the ACA.  For example, the plans cannot impose lifetime limits on how much health care coverage people may receive, and they must offer dependent coverage for young adults until age 26 (although until 2014, a grandfathered group plan does not have to offer such coverage if a young adult is eligible for coverage elsewhere). They also cannot retroactively cancel your coverage because of a mistake you made when applying, a practice known as a rescission.

This <a target="_blank" href="/insurance/grandfathered-plans-faq/">article</a&gt; first appeared on <a target="_blank" href="">KFF Health News</a> and is republished here under a <a target="_blank" href=" Commons Attribution-NonCommercial-NoDerivatives 4.0 International License</a>.<img src="/wp-content/uploads/sites/8/2023/04/kffhealthnews-icon.png?w=150&quot; style="width:1em;height:1em;margin-left:10px;">

Holliday, an artist and patient advocate from Washington, balances there for just a moment, beaming before the small cadre of advocates, doctors and tech gurus who are as determined as she is to make patients equal participants in every area of health care. They are here, on the banks of the Missouri River early on a Saturday morning, for a conference she has organized in just weeks.

They burst into applause.

The conference is far from typical. There’s no foundation underwriting it, no public relations firm managing it, and no hotel ballroom. Instead there is a scholarship system, donated food, and an educational center that still features the old-time river town set that once welcomed casino-goers. Green street lamps rise above the old shops and restaurants, a sign painted on the wooden wall advertises “trusty and honest” livestock brokers, and the curved wooden ticket counter gleams next to the rows of black, plastic chairs for the audience.

It’s classic Holliday: grassroots, offbeat, and unabashed.

Three years ago Holliday was a grieving widow on a solo mission to protect other families from what hers suffered as her husband died of kidney cancer. Today she’s a high-profile advocate with access and influence few other individuals can match. Her policy work focuses on making sure patients have access to their electronic medical records, but along the way, she has emerged as a leader among health care advocates of all kinds who agree the patient perspective too often is ignored when policies are developed and care is given.

Holliday hoists the cinderblock, deposits it on a red leather chair on the stage, and begins to tell the kind of personal story that has helped give her such reach.

When Holliday was in fifth grade in small-town Oklahoma, her school couldn’t afford bookshelves for her classroom, she tells the gathering. But her teacher arranged for the local lumberyard to donate cinderblocks and two-by-fours, and the children carried them back to the school where they constructed their own simple shelf.

“I will tell you there was no bookshelf more loved and appreciated than that one,” Holliday says. “It may not have looked pretty, it may not have been the most grand, but it was ours.”

It’s the message Holliday wants her audience to carry with them throughout the weekend: that despite their modest means, they can build something worthwhile.

“We may not fit a traditional mold but if we work together within this space, we will change it for us all and make it better,” she says. In her writing, Holliday is fond of words like “must” and “shall,” and when she is on stage, she speaks with deliberate pauses and dramatic changes in volume, an overall effect that brings to mind a sermon.

Her personal, passionate delivery is part of what has persuaded advocates from New York, Los Angeles, Austin, and elsewhere to fly in for the weekend, most of them on their own dime. They are a who’s who of advocates already working diligently for their specific causes, from lupus and breast cancer to reducing infections in hospitals and improving end-of-life care. For most, it’s unpaid work they do on top of their day jobs.

They’ve come because the “Partnership With Patients” conference is an opportunity for them to learn how to be better supporters of those causes through workshops on public speaking, talking to journalists, and using social media websites like Facebook and Twitter, as well as to learn more about the latest in health care policy.

But there’s a bigger goal, too: to begin figuring out how patient advocates can work collectively to make the entire health care system more responsive to the ideas patients have about how to improve care. They are in search of a system that truly is collaborative, not one where the perspectives of government officials or doctors always trump those of patients and their families.

The advocates are optimistic that they have good timing. As the health care system reorganizes itself in ways that aim to make health care better, safer and cheaper, they see an opening to make the patient voice part of those reforms.

Becoming An Advocate

Holliday, who is 40, has made her mark on the health care world by telling stories that draw on her own life and the lives of others to illuminate why health care has to change—not just for those who already have been through the system but for everyone who will encounter it.

Dave deBronkart, a well-known patient advocate and speaker, likes to say that “patient is not a third-person word,” by which he means that just about everyone will be cared for at some point in their lives. He says the challenge is “how do you convey this to the people who make decisions in a way that makes a difference? And that is Regina’s gift.”

Holliday’s own effort to make her voice heard began with the back wall of a BP gas station on Connecticut Avenue in Washington. Just one week after her husband Fred, a professor of film at American University, died in 2009 at age 39, leaving behind two young sons, she propped a ladder against that wall and started painting, trying to express everything that had gone so very wrong for their family.

In the mural, Fred lies in a hospital bed with his eyes closed, and one hand hangs toward the floor with a pen in it. In the other is a note: “Go after them, Regina. Love, Fred.”

That’s what he asked her to do, when after weeks of trying to get answers about his cancer diagnosis or the course of care he would receive, the doctor who had always been too busy to answer their questions unceremoniously announced he was sending Fred home to die.

The mural also illustrates her struggle to get a copy of Fred’s medical record. When she requested a copy of the hundreds of pages, the hospital balked. Finally, they said that it would be $0.73 per page and would take 21 days

Those 73 cents — two quarters, two dimes, three pennies — are lined up under Fred’s bed in the mural. They became for Holliday the epitome of what had gone wrong, because when she finally got a hold of the record, what she found made her furious.

“It was filled with data,” she says now, her brown eyes flashing. “If I could only have read it on a daily basis, he could have gotten better care.”

“The notes in the record showed that Fred should have had a urinary catheter, that his lidocaine patches were left on too long, and, most devastatingly, that what the Hollidays thought was a three-centimeter tumor was really eight-centimeters. And there were two, one in each kidney. Knowing sooner, and making sense of the information with a doctor by their side could have helped them make more informed decisions about how to care for Fred.

Patient access to information became Holliday’s rallying cry, and as she went to every meeting and conference she could to learn more, she told her story again and again.

Over time she gained a reputation for her ability to pair personal stories and policy. She started getting invited to government meetings and onstage at conferences as a patient speaker. Ted Eytan, a family physician who heads Kaiser Permanente’s Center for Total Health in Washington, has known Holliday since her early days as an advocate and says that what makes her so powerful is that she is driven by a sense of mission.

“She doesn’t mind flying coach for 22 hours. She doesn’t mind not getting the star treatment. She doesn’t mind talking to people who maybe have not been nice to this movement. She will talk to anyone at anytime,” he says.

That doesn’t mean she’s afraid to let people know how she feels.

Eytan and deBronkart both point to a meeting they attended with Holliday and the medical director of a Washington-area health care organization about how much access patients should have to their electronic health records.

What could a patient possibly spot in a record that a doctor or nurse wouldn’t, the doctor asked.

Holliday told him about how Fred’s doctors had ordered a walker for him but it never arrived. Had she been reading the record, she could have asked about it. She told him about how Fred’s record indicated he needed a catheter and how he never received one. She would have noticed.

Okay, said the doctor. But this is easy for us to imagine, sitting here with our college degrees. What about less educated people?

I don’t have a college degree, Holliday fired back. And she changed his mind.

The Walking Gallery

While she has immersed herself in the policy weeds, Holliday still uses art as a way to tell her story and the stories of others. She paints jackets for patients and other health care stakeholders from across the country. On the back of each one, she creates a single frame that represents the story of the person who will wear it into medical and policy conferences where the voices of patients and their families rarely are heard. She calls it the Walking Gallery.

Her idea is this: a doctor’s coat, a CEO’s suit jacket, or a badge stamped with the name of a hospital system or government office functions as a kind of uniform. When you walk into a conference with all of the proper professional accessories, you’re just like everyone else. But, if you put a picture on your back, you’re marked as different. Holliday’s theory goes that you are therefore more conscious of your own story — and of the fact that tens of millions of patients have stories just like you do.

Holliday has painted more than 200 jackets, and while that’s not many in the grand scheme of the health care system, she has brought in big names like Todd Park, chief technology officer at the White House and , who heads up health information technology at HHS.

Park calls Holliday’s work “incredibly cool.”

“It’s a reminder that all of this work is about improving patients’ experience and patient outcomes,” he says.

Holliday’s own jacket is primary school red with a black collar and a giant “A” emblazoned on the back that stands for Little Miss Type A Personality — that’s what Fred’s doctor called her, when he found out she was running around the hospital, trying desperately to find out why he kept getting sicker. It wasn’t a compliment.

Holliday is wearing the jacket that Saturday night at the conference last September. About 75 people are there, many of them advocates relishing the opportunity to connect with others who share their passion and often a personal story about the health care system.

“Patient advocacy is such a strong passion, and it’s not something you take on like, oh I love model making or I love chocolate desserts. It becomes such a driving part of your life. When you find somebody that feels that way, it’s not just validating but exciting,” says Pat Mastors, a hospital safety advocate who is based in Rhode Island and helped organize the conference. Mastors, a former television reporter, became an advocate when her father died of an infection after undergoing routine surgery.

For those on the partner side of the equation, the conference is a chance to learn more about what patients want. Bunny Ellerin, senior vice-president of the pharmaceutical marketing company Intouch Solutions, says she has noted the rise of what she calls “patient opinion leaders” in recent years and thinks it is critical Intouch’s clients understand that perspective.

“Just putting people together and connecting, I find, is often a very important first step,” she says.

Holliday’s advocacy is now a full-time job. She is paid to paint and speak at conferences all over the world, and she relishes being on stage.

But even after all these years of telling her own story, Holliday says she stills find herself short of breath and in tears when she remembers what happened, visualizing each step to the ending she knows she can’t change. She hopes those she speaks to find themselves crying along with her.

“I want you to be so touched that you can’t go back to your normal life anymore,” she says.

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Bodaken’s successor, Paul Markovich (the chief operating officer), may not have an easy time of it. He’ll have to implement provisions of the federal health law while trying to keep costs as low as possible. “That will be the biggest challenge that I think any health plan CEO will face over the next several years,” Bodaken said.

Bodaken’s views on the health law and the current state of the insurance industry were among the many topics during a recent interview with Kaiser Health News. Here are edited excerpts:  

Q. Why retire now?

A. One thing I told my board when I first came on, after a decade or so, you need to think about changing your CEO as a policy matter.  There is a time for these things for any corporation, for any person. I’ve been doing this for 12 years. I don’t see this retirement as me dropping out of sight.

Q. What do you think insurers will have to contend with as they head to 2014, when the federal health law will fully kick in?

A. One of the biggest challenges will just be incorporating all of the new regulations in such a short period of time – and putting those into effect in complex organizations with multiple products with different geographies. Those regulations impact eligibility, they impact how we interact with providers, they impact how we interact with the [health insurance] exchange.

And, of course, we’re not just talking about federal regulations; we’re talking about regulations in California that are peculiar to our state. If you look at all of that, I think one of the biggest challenges will be all of the health plans, providers, everyone in the industry being able to get this right with such complex, in some cases, not-clear regulation.

Early on, I gave (the federal) HHS great credit in that they issued regulations very quickly. Of course it closed down over the election and I think that was expected. But it was a bad time for us to be slowing down because we only have really a few months left before we have to submit to the federal government the outline of our plan.

Q. But Blue Shield of California won’t have to worry because you’re only in California, right?

A. We think we would worry if other competitors are gaining ground as part of a large association of [multi-state] plans. We want it to be sustainable. 

Q. Are there challenges that are specific to California’s exchange?

A. A small employer should make a choice about which plans are available to the employees. If each employee is able to make a choice between carriers, it’s going to be very complex and difficult from both a ratings standpoint and for making sure that we have a cohesive group that we can rate against. [If] each member of the group can have a different choice, it’s not clear to us how that works.

Q. There’s been some talk about whether the premium subsides for low income-people offered through the health insurance exchanges could be changed as part of a deal to solve the national “fiscal cliff” predicament.  Would that be problematic?

A. Changing the subsidies would be problematic in that this is a bill about expanding coverage for the people who have been least able to afford it.  And the impact that the subsidies have on a group that will not be eligible for Medi-Cal or Medicaid is profound.  So, in general we would not want to see those subsidies cut back. 

I’m a realist and understand that there’s going to be a lot of different issues that are going to be part of any grand deal, any grand bargain, if this is one that has to be modified to address that, I hope it is not too significant. And I hope that it’s clear so that we can get it into place immediately because right now we’re dealing with the current expectations of the current law.  If that were to change, it needs to change quickly.

Q. The health law calls for the establishment of ACOs – accountable care organizations – so that providers will coordinate care for patients. Do you have any suggestions about what should happen at the federal level to encourage their success?

A. At the federal level, what would be helpful again would be to not be too prescriptive in the area of accountable care organizations.  There are principles that we’re using to organize and I think we’ve developed the greatest number in California of any of the plans there at this point. We have led the field on actual signed contracts that are organized with global reimbursement arrangements.

Watching a thousand flowers bloom I think is a good thing across the states – and even across products, commercial products and Medicare products. We think (ACOs) are going to make a real difference in cost. They’re going to make a real difference in quality and the biggest challenge that we will face are having enough seasoned and experienced medical directors and physician leaders. Physician leadership on the ground makes the difference. 

Q. Why do you think the public is still split on the federal health law?

A. The health care law has many pieces to it. The consumer protections that have been put in early on, I think, are well regarded. I think everyone agrees that it is time to get away from a system of determining a person’s health insurance by virtue of their health status. And so, doing away with preexisting conditions was overdue. 

Any change is scary until you put it in place and then it seems like it was the natural thing to do two years later.

This law will continue to go through some changes, I’m sure. There’s a lot we’re going to have to experiment with and I hope we’ll be encouraging HHS and the government to allow states to experiment. If we get only the people that need care in the system, it’s obvious that premiums will go up beyond what anyone can pay and that won’t be a success or sustainable. So, while we think it is something that over time people could accept, we need to do this in stages.

This <a target="_blank" href="/insurance/bodaken-q-and-a/">article</a&gt; first appeared on <a target="_blank" href="">KFF Health News</a> and is republished here under a <a target="_blank" href=" Commons Attribution-NonCommercial-NoDerivatives 4.0 International License</a>.<img src="/wp-content/uploads/sites/8/2023/04/kffhealthnews-icon.png?w=150&quot; style="width:1em;height:1em;margin-left:10px;">

In to its on the nation’s budget and economic outlook, CBO said that outlays for Medicare will total 3.7 percent of the gross domestic product in 2013, rising to 4.3 percent of GDP in 2022, as enrollment in the program increases.

But the report also noted that for the third year in a row, CBO expects the growth in Medicare spending in 2012 to be “substantially slower” than anticipated earlier in the year.

CBO Director Doug Elmendorf said at a press conference that the slower growth in Medicare is consistent with slower health care cost growth throughout the economy, which many analysts have observed. But he said it’s still the slowdown is happening.

“Presumably, the weak state of the economy is a factor, but given the magnitude of the slowdown in national health spending and the timing of that slowdown, which seems to have started before the recession, we and most analysts think there are probably structural factors at work as well,” he said. Those structural factors could include slower growth of spending on prescription drugs, changes in the health care delivery and payment system, and higher out-of-pocket spending for consumers, according to Elmendorf.

The report also looked at Medicaid. Federal outlays for the program are expected to total 1.7 percent of GDP next year and 2.4 percent of GDP in 2022 as the program expands under the 2010 health law. In comparison to its though, the CBO said Medicaid spending would decrease by $325 billion, or 7 percent, from 2013 to 2022. The bulk of that reduction is due to the Supreme Court’s ruling on the health law, which makes optional an expansion of the program that the law essentially required all states to put in place.

Overall, CBO said that the economy could return to a recession in 2013 if lawmakers do not avoid a set of tax increases and spending reductions that will take effect in January, a deadline often referred to as the “fiscal cliff.”

Physicians face a 27 percent cut in their Medicare payments next year unless lawmakers forestall the hit. Congress historically has acted to avoid such cuts, which are the result of a formula known as the sustainable growth rate. CBO said that holding Medicare physician payment rates at current levels next year would cost $10 billion, and a total of $245 billion if they were left unchanged through 2022.

But even if Congress averts the fiscal cliff and a recession, the economy cannot sustain the high debt levels that would result in the long term if current tax and spending levels are left unchanged, according to Elmendorf.

“The key issue facing policymakers is not whether to reduce budget deficits relative to those that would occur under current policies. The question is when; the question is how,” he said.

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They’ve adopted a strategy known as a “learning health system,” which creates a feedback loop of sorts between the system’s medical and research sides, including the .  In broad terms, researchers help doctors evaluate new ways of providing care, and doctors suggest areas where research is needed — meaning evidence and practice exist in a cycle.

In for the Annals of Internal Medicine, officials at Group Health describe the idea of the learning health system and how it’s making a difference there.

Eric Larson, a co-author of the paper, said that health care innovations traditionally take years to make their way into doctors’ offices. That delay means new ideas aren’t being tested quickly to weed out those that don’t work, and patients aren’t rapidly getting the benefit of those that do.

“That wait is just lost gain for patients and for public health,” said Larson, vice president for research at Group Health and executive director at the Group Health Research Institute.

One important piece of the learning health system at Group Health is the Partnership for Innovation. Under that program, clinicians propose ideas for delivery system reform, and researchers help shape selected ideas into workable projects that can be evaluated.

The learning health system model has played a key role in various Group Health initiatives, including its move to patient-centered medical homes, an opioid-prescribing safety initiative and evaluating high-end imaging use.

Matt Handley, the medical director for quality and informatics at Group Health, said the model means implementation of new ideas and research on them can happen simultaneously, and makes it easier for doctors to evaluate changes in how they deliver care. That doesn’t always happen when health systems around the country try new things.

“Because their intention is good, they assume the outcomes are good,” he said. “And that’s not always the case.”

Group Health long has embedded research into its system, but a turning point in the system’s embrace of the learning health system concept came in 2007 when Group Health decided to try a new way of providing primary care through patient-centered medical homes.

Rather than clinicians implementing the program and researchers studying the results, the two groups worked together from the onset. Researchers shared the latest findings on primary care with clinicians and evaluated the medical homes as they were developed on a pilot basis. By 2009, the model had spread to all 25 Group Health medical centers because of positive findings by the researchers.

Sarah Greene, director of strategy and business development at Group Health and the lead author of the paper, said that two key components of a learning health system are having people in place who span the research-clinical divide and can help information flow between the two sides, and having a culture that is intensely curious and values improvement.

“It requires a degree of vulnerability to say we want to learn more,” she said.

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The economists said in for the New England Journal of Medicine that while the 2010 federal health law aims to slow health spending through programs such as value-based purchasing and bundled payments, it fails to alter fundamentally the health care financing system. The paper was authored by Joseph R. Antos of the conservative-leaning American Enterprise Institute, Mark V. Pauly of the University of Pennsylvania, and Gail R. Wilensky of Project HOPE, a former head of the Medicare and Medicaid programs.

Their perspective appeared by 23 economists and health policy experts brought together by the liberal-leaning Center For American Progress who came up with a . The CAP group called for state spending targets; competitive bidding for medical devices, laboratory tests and other Medicare services; and changing the  traditional way doctors and hospitals are paid for every service.

Journal editors said they presented the differing approaches to stimulate conversation about how best to deal with health care costs.

The conservative thinkers said that changing Medicare from a defined benefit to a defined contribution approach would give seniors an incentive to choose lower-cost plans, and give plans an incentive to provide more cost-effective services.  Their proposal is similar to , R-Wis., and incorporated into .

The economists did say, though, that setting statutory limits on subsidy growth—such as the gross domestic product plus 0.5 percent limit in the Ryan plan—can sometimes be problematic because they can threaten access to care and “medical progress.”  Those problems are common to all formula-driven spending controls, including the health law’s Independent Payment Advisory Board, they added.

“If competition can keep Medicare spending within the bounds set by the targets, then the targets are unnecessary,” they said.  “If not, price controls will do no better.”

The economists also recommended narrowing the unlimited tax subsidy for employer-sponsored insurance—under which most employees do not pay taxes on such coverage—which they said would have a similar effect.

“Reliance on competitive markets rather than on regulatory controls provides strong incentives for more efficient delivery of the health services that consumers truly value,” they said.

In their paper arguing for a market-based approach, the economists said that seniors in Medicare would receive a subsidy to purchase insurance from a variety of plans that include traditional Medicare and all of which provide a core set of benefits. The subsidy would be based on the low bids and would vary based on financial and health needs. Beneficiaries who wanted to buy a more expensive plan would pay the difference on their own.

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Romney on Monday highlighted the fact that Israel spends 8 percent of its gross domestic product on health care, compared with 18 percent in the U.S.

“We have to find ways — not just to provide health care to more people, but to find ways to fund and manage our health care costs,” he said at a breakfast fundraiser in Jerusalem, according to the .

So what exactly does health care look like in Israel?  A handy prepared for the Jewish Healthcare Foundation gives the rundown.  Here are some key features:

• Under the country’s 1995 National Health Insurance (NHI) law, Israelis can choose one of four, nonprofit health plans.
• The health plans must provide a benefit package set in law.
• Israel pays each plan a capitated rate that primarily takes into account the number of members and their ages.  Some funding is distributed based on how many members have rare but expensive conditions.
• The NHI system is financed mostly by income taxes, but 40 percent of the funding comes from out-of-pocket payments, such as co-pays or supplemental insurance purchases.
• The Ministry of Health operates about half of the country’s hospital beds.

Romney’s comments rocketed around the blogosphere as that the Israeli system is highly centralized — and similar in some ways to the federal health law that Romney has vowed to repeal.  For example, Israel’s requirement that everyone have insurance is much like the individual mandate.  Plus, as Sarah Kliff explained on the Washington Post’s , researchers have attributed Israel’s ability to hold down costs without skimping on quality to the “strong government influence” over the system.

A Romney spokesman that his comments were not intended to praise the entire Israeli system but simply to comment on the need to lower costs in the U.S.

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States continue to struggle with Medicaid costs, a factor that looms over their tepid economic recovery, according to a released Tuesday.

The economic outlook for the states is starting to brighten, but growth is slow and budgets still are tight, said the  and the in their semi-annual fiscal survey of the states.

Part of the problem is Medicaid. While state spending on the program isn’t expected to grow as dramatically in the coming year as it did in the past two years, the costs still are a burden, according to the report.

“With the growth of Medicaid expenditures, spending priorities will again face competition for state budget dollars this fiscal year,” said Dan Crippen, the executive director of the NGA, in a statement.

The reasons for the spending growth include the lackluster labor market, which means fewer people are insured through their jobs and instead turn to Medicaid for coverage, and the growth in costs throughout the health care system, according to the report.

The federal government currently pays at least half and as much as three-quarters of Medicaid costs, . The 2010 health law calls for a massive expansion of the Medicaid program and the federal government will cover 100% of the cost for the new beneficiaries for the first few years (gradually reducing that to 90 percent by 2020).

State Medicaid spending is forecast to increase 3.9 percent in fiscal year 2013, which begins July 1 for most states, based on governors’ budget proposals.  That’s down from 20.4 percent the previous year, as states no longer received extra money they had gotten from the federal government because of  the .

But, the Medicaid spending growth rate is expected to outpace the growth of overall general fund expenditures, and, during the past 10 years, Medicaid growth has exceeded the increases in all other categories of state spending, according to NGA and NASBO.

That means states still are looking for ways to cut costs, after years of provider rate reductions, benefit cuts, and other cost containment measures.   The report said states will continue to take actions such as reducing or freezing rates, but they also are looking at longer-term strategies such as expanding managed care or efforts to prevent fraud and waste.

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Mayor Vincent C. Gray (D) earlier this spring cutting hospital-based care from the to save more than $20 million in the District’s budget, which begins in October.  The alliance covers about 19,000 people, most of whom are illegal immigrants.

But District Council member David A. Catania (I-At Large), who chairs the health committee, opposed the cuts, arguing that they would diminish care for an already vulnerable population that should not be treated differently because of its immigration status, according to his spokesman Brendan Williams-Kief.

The alliance was set up to cover low-income city residents who are ineigible for Medicaid, but the 2010 federal health law opened the joint federal-state program to many of those people. That expansion does not cover illegal  immigrants, however, who now make up the bulk of the alliance program.

After weeks of political wrangling, the mayor and council settled on a compromise that preserves the alliance’s hospital benefits through tweaks and trims to other District health programs and an expected increase in federal funding for emergency treatment.

Both Catania and Gray praised the compromise in .

“Today’s agreement ensures that all low-income District residents are treated equally and afforded the dignity of comprehensive, high quality health care,” Catania said.

Gray said he is “delighted” the compromise maintains the Alliance funding and protects other health care programs.

“The plan addresses my concerns and the concerns we heard from many community organizations, while ensuring Alliance beneficiaries will continue to receive critical health-care coverage,” he said.

The council approved the budget by a vote of 12-0.  A final vote is scheduled for June 5.

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Finding high-quality, cost-effective ways to care for the 9 million people known as “dual eligibles” is among the brass rings of health policy.  The population includes some of the sickest and poorest Americans who must navigate a fragmented system that can impede their care. Managing their care is important because they account for a disproportionate share of health spending — they account for approximately 20 percent of Medicare’s beneficiaries, for instance, but 31 percent of its spending, and 15% of Medicaid beneficiaries, but nearly 40 percent of that program’s spending, according to , the director of the Medicare-Medicaid Coordination Office.

Bella said Tuesday that more than half the states have expressed interest in testing of care for dual eligibles. Twenty-five states have posted their plans for public comment, and seven already have submitted their plans to the federal government. The first wave of states is expected to go live with their plans in January 2013, according to Bella, who spoke at a panel discussion on dual eligibles held by the American Enterprise Institute.

However, Patricia Nemore, an attorney at the , said advocates are nervous about whether the plans do enough to protect dual eligibles, and more time would help ensure those concerns are addressed.  The states may pledge to protect beneficiaries in a general sense, but their plans need to be concrete, she said.

Bella said that questions about how fast to move are legitimate, but that it’s important for officials to act with urgency to get new models off the ground.

“Everywhere I go I get a group of people telling me we’re moving too slow and a group of people telling me we’re moving too fast,” she said.

This article was produced by Kaiser Health News with support from .

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While the attention lately has focused on individual policies, if you get your insurance from your employer, there’s a good chance that you are in a grandfathered plan, and that means some of the changes the law requires do not affect you — yet. More than a third of all Americans who get insurance through their jobs are enrolled in such plans, although that number is expected to decline every year.

Consumers should know the status of their plans since that may determine whether they are eligible for certain protections and benefits created by the health law.  For example, an employee at a large company may wonder why his job-based insurance doesn’t include the free preventive services he’s heard about. To answer questions like that, you must understand the status of your plan and how grandfathering works.  Here are the basics:

What is a grandfathered plan?

Most health insurance plans that existed on March 23, 2010 are eligible for grandfathered and therefore do not have to meet all the requirements of the health care law.  But if an insurer or employer makes significant changes to a plan’s benefits or how much members pay through premiums, copays or deductibles, then the plan loses that status. 

The government’s spell out how much plans can change the amount paid by workers or employers before losing their status.

Both individual plans, the kind you buy on your own, and group plans, the kind you receive through an employer, can be grandfathered. If you get coverage through an employer, you can join a grandfathered plan even if you weren’t enrolled on March 23, 2010.

What rules does a grandfathered plan have to follow?

A grandfathered plan has to follow some of the same rules other plans do under the ACA.  For example, the plans cannot impose lifetime limits on how much health care coverage people may receive, and they must offer dependent coverage for young adults until age 26 (although until 2014, a grandfathered group plan does not have to offer such coverage if a young adult is eligible for coverage elsewhere). They also cannot retroactively cancel your coverage because of a mistake you made when applying, a practice known as a rescission.

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Holliday, an artist and patient advocate from Washington, balances there for just a moment, beaming before the small cadre of advocates, doctors and tech gurus who are as determined as she is to make patients equal participants in every area of health care. They are here, on the banks of the Missouri River early on a Saturday morning, for a conference she has organized in just weeks.

They burst into applause.

The conference is far from typical. There’s no foundation underwriting it, no public relations firm managing it, and no hotel ballroom. Instead there is a scholarship system, donated food, and an educational center that still features the old-time river town set that once welcomed casino-goers. Green street lamps rise above the old shops and restaurants, a sign painted on the wooden wall advertises “trusty and honest” livestock brokers, and the curved wooden ticket counter gleams next to the rows of black, plastic chairs for the audience.

It’s classic Holliday: grassroots, offbeat, and unabashed.

Three years ago Holliday was a grieving widow on a solo mission to protect other families from what hers suffered as her husband died of kidney cancer. Today she’s a high-profile advocate with access and influence few other individuals can match. Her policy work focuses on making sure patients have access to their electronic medical records, but along the way, she has emerged as a leader among health care advocates of all kinds who agree the patient perspective too often is ignored when policies are developed and care is given.

Holliday hoists the cinderblock, deposits it on a red leather chair on the stage, and begins to tell the kind of personal story that has helped give her such reach.

When Holliday was in fifth grade in small-town Oklahoma, her school couldn’t afford bookshelves for her classroom, she tells the gathering. But her teacher arranged for the local lumberyard to donate cinderblocks and two-by-fours, and the children carried them back to the school where they constructed their own simple shelf.

“I will tell you there was no bookshelf more loved and appreciated than that one,” Holliday says. “It may not have looked pretty, it may not have been the most grand, but it was ours.”

It’s the message Holliday wants her audience to carry with them throughout the weekend: that despite their modest means, they can build something worthwhile.

“We may not fit a traditional mold but if we work together within this space, we will change it for us all and make it better,” she says. In her writing, Holliday is fond of words like “must” and “shall,” and when she is on stage, she speaks with deliberate pauses and dramatic changes in volume, an overall effect that brings to mind a sermon.

Her personal, passionate delivery is part of what has persuaded advocates from New York, Los Angeles, Austin, and elsewhere to fly in for the weekend, most of them on their own dime. They are a who’s who of advocates already working diligently for their specific causes, from lupus and breast cancer to reducing infections in hospitals and improving end-of-life care. For most, it’s unpaid work they do on top of their day jobs.

They’ve come because the “Partnership With Patients” conference is an opportunity for them to learn how to be better supporters of those causes through workshops on public speaking, talking to journalists, and using social media websites like Facebook and Twitter, as well as to learn more about the latest in health care policy.

But there’s a bigger goal, too: to begin figuring out how patient advocates can work collectively to make the entire health care system more responsive to the ideas patients have about how to improve care. They are in search of a system that truly is collaborative, not one where the perspectives of government officials or doctors always trump those of patients and their families.

The advocates are optimistic that they have good timing. As the health care system reorganizes itself in ways that aim to make health care better, safer and cheaper, they see an opening to make the patient voice part of those reforms.

Becoming An Advocate

Holliday, who is 40, has made her mark on the health care world by telling stories that draw on her own life and the lives of others to illuminate why health care has to change—not just for those who already have been through the system but for everyone who will encounter it.

Dave deBronkart, a well-known patient advocate and speaker, likes to say that “patient is not a third-person word,” by which he means that just about everyone will be cared for at some point in their lives. He says the challenge is “how do you convey this to the people who make decisions in a way that makes a difference? And that is Regina’s gift.”

Holliday’s own effort to make her voice heard began with the back wall of a BP gas station on Connecticut Avenue in Washington. Just one week after her husband Fred, a professor of film at American University, died in 2009 at age 39, leaving behind two young sons, she propped a ladder against that wall and started painting, trying to express everything that had gone so very wrong for their family.

In the mural, Fred lies in a hospital bed with his eyes closed, and one hand hangs toward the floor with a pen in it. In the other is a note: “Go after them, Regina. Love, Fred.”

That’s what he asked her to do, when after weeks of trying to get answers about his cancer diagnosis or the course of care he would receive, the doctor who had always been too busy to answer their questions unceremoniously announced he was sending Fred home to die.

The mural also illustrates her struggle to get a copy of Fred’s medical record. When she requested a copy of the hundreds of pages, the hospital balked. Finally, they said that it would be $0.73 per page and would take 21 days

Those 73 cents — two quarters, two dimes, three pennies — are lined up under Fred’s bed in the mural. They became for Holliday the epitome of what had gone wrong, because when she finally got a hold of the record, what she found made her furious.

“It was filled with data,” she says now, her brown eyes flashing. “If I could only have read it on a daily basis, he could have gotten better care.”

“The notes in the record showed that Fred should have had a urinary catheter, that his lidocaine patches were left on too long, and, most devastatingly, that what the Hollidays thought was a three-centimeter tumor was really eight-centimeters. And there were two, one in each kidney. Knowing sooner, and making sense of the information with a doctor by their side could have helped them make more informed decisions about how to care for Fred.

Patient access to information became Holliday’s rallying cry, and as she went to every meeting and conference she could to learn more, she told her story again and again.

Over time she gained a reputation for her ability to pair personal stories and policy. She started getting invited to government meetings and onstage at conferences as a patient speaker. Ted Eytan, a family physician who heads Kaiser Permanente’s Center for Total Health in Washington, has known Holliday since her early days as an advocate and says that what makes her so powerful is that she is driven by a sense of mission.

“She doesn’t mind flying coach for 22 hours. She doesn’t mind not getting the star treatment. She doesn’t mind talking to people who maybe have not been nice to this movement. She will talk to anyone at anytime,” he says.

That doesn’t mean she’s afraid to let people know how she feels.

Eytan and deBronkart both point to a meeting they attended with Holliday and the medical director of a Washington-area health care organization about how much access patients should have to their electronic health records.

What could a patient possibly spot in a record that a doctor or nurse wouldn’t, the doctor asked.

Holliday told him about how Fred’s doctors had ordered a walker for him but it never arrived. Had she been reading the record, she could have asked about it. She told him about how Fred’s record indicated he needed a catheter and how he never received one. She would have noticed.

Okay, said the doctor. But this is easy for us to imagine, sitting here with our college degrees. What about less educated people?

I don’t have a college degree, Holliday fired back. And she changed his mind.

The Walking Gallery

While she has immersed herself in the policy weeds, Holliday still uses art as a way to tell her story and the stories of others. She paints jackets for patients and other health care stakeholders from across the country. On the back of each one, she creates a single frame that represents the story of the person who will wear it into medical and policy conferences where the voices of patients and their families rarely are heard. She calls it the Walking Gallery.

Her idea is this: a doctor’s coat, a CEO’s suit jacket, or a badge stamped with the name of a hospital system or government office functions as a kind of uniform. When you walk into a conference with all of the proper professional accessories, you’re just like everyone else. But, if you put a picture on your back, you’re marked as different. Holliday’s theory goes that you are therefore more conscious of your own story — and of the fact that tens of millions of patients have stories just like you do.

Holliday has painted more than 200 jackets, and while that’s not many in the grand scheme of the health care system, she has brought in big names like Todd Park, chief technology officer at the White House and , who heads up health information technology at HHS.

Park calls Holliday’s work “incredibly cool.”

“It’s a reminder that all of this work is about improving patients’ experience and patient outcomes,” he says.

Holliday’s own jacket is primary school red with a black collar and a giant “A” emblazoned on the back that stands for Little Miss Type A Personality — that’s what Fred’s doctor called her, when he found out she was running around the hospital, trying desperately to find out why he kept getting sicker. It wasn’t a compliment.

Holliday is wearing the jacket that Saturday night at the conference last September. About 75 people are there, many of them advocates relishing the opportunity to connect with others who share their passion and often a personal story about the health care system.

“Patient advocacy is such a strong passion, and it’s not something you take on like, oh I love model making or I love chocolate desserts. It becomes such a driving part of your life. When you find somebody that feels that way, it’s not just validating but exciting,” says Pat Mastors, a hospital safety advocate who is based in Rhode Island and helped organize the conference. Mastors, a former television reporter, became an advocate when her father died of an infection after undergoing routine surgery.

For those on the partner side of the equation, the conference is a chance to learn more about what patients want. Bunny Ellerin, senior vice-president of the pharmaceutical marketing company Intouch Solutions, says she has noted the rise of what she calls “patient opinion leaders” in recent years and thinks it is critical Intouch’s clients understand that perspective.

“Just putting people together and connecting, I find, is often a very important first step,” she says.

Holliday’s advocacy is now a full-time job. She is paid to paint and speak at conferences all over the world, and she relishes being on stage.

But even after all these years of telling her own story, Holliday says she stills find herself short of breath and in tears when she remembers what happened, visualizing each step to the ending she knows she can’t change. She hopes those she speaks to find themselves crying along with her.

“I want you to be so touched that you can’t go back to your normal life anymore,” she says.

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Bodaken’s successor, Paul Markovich (the chief operating officer), may not have an easy time of it. He’ll have to implement provisions of the federal health law while trying to keep costs as low as possible. “That will be the biggest challenge that I think any health plan CEO will face over the next several years,” Bodaken said.

Bodaken’s views on the health law and the current state of the insurance industry were among the many topics during a recent interview with Kaiser Health News. Here are edited excerpts:  

Q. Why retire now?

A. One thing I told my board when I first came on, after a decade or so, you need to think about changing your CEO as a policy matter.  There is a time for these things for any corporation, for any person. I’ve been doing this for 12 years. I don’t see this retirement as me dropping out of sight.

Q. What do you think insurers will have to contend with as they head to 2014, when the federal health law will fully kick in?

A. One of the biggest challenges will just be incorporating all of the new regulations in such a short period of time – and putting those into effect in complex organizations with multiple products with different geographies. Those regulations impact eligibility, they impact how we interact with providers, they impact how we interact with the [health insurance] exchange.

And, of course, we’re not just talking about federal regulations; we’re talking about regulations in California that are peculiar to our state. If you look at all of that, I think one of the biggest challenges will be all of the health plans, providers, everyone in the industry being able to get this right with such complex, in some cases, not-clear regulation.

Early on, I gave (the federal) HHS great credit in that they issued regulations very quickly. Of course it closed down over the election and I think that was expected. But it was a bad time for us to be slowing down because we only have really a few months left before we have to submit to the federal government the outline of our plan.

Q. But Blue Shield of California won’t have to worry because you’re only in California, right?

A. We think we would worry if other competitors are gaining ground as part of a large association of [multi-state] plans. We want it to be sustainable. 

Q. Are there challenges that are specific to California’s exchange?

A. A small employer should make a choice about which plans are available to the employees. If each employee is able to make a choice between carriers, it’s going to be very complex and difficult from both a ratings standpoint and for making sure that we have a cohesive group that we can rate against. [If] each member of the group can have a different choice, it’s not clear to us how that works.

Q. There’s been some talk about whether the premium subsides for low income-people offered through the health insurance exchanges could be changed as part of a deal to solve the national “fiscal cliff” predicament.  Would that be problematic?

A. Changing the subsidies would be problematic in that this is a bill about expanding coverage for the people who have been least able to afford it.  And the impact that the subsidies have on a group that will not be eligible for Medi-Cal or Medicaid is profound.  So, in general we would not want to see those subsidies cut back. 

I’m a realist and understand that there’s going to be a lot of different issues that are going to be part of any grand deal, any grand bargain, if this is one that has to be modified to address that, I hope it is not too significant. And I hope that it’s clear so that we can get it into place immediately because right now we’re dealing with the current expectations of the current law.  If that were to change, it needs to change quickly.

Q. The health law calls for the establishment of ACOs – accountable care organizations – so that providers will coordinate care for patients. Do you have any suggestions about what should happen at the federal level to encourage their success?

A. At the federal level, what would be helpful again would be to not be too prescriptive in the area of accountable care organizations.  There are principles that we’re using to organize and I think we’ve developed the greatest number in California of any of the plans there at this point. We have led the field on actual signed contracts that are organized with global reimbursement arrangements.

Watching a thousand flowers bloom I think is a good thing across the states – and even across products, commercial products and Medicare products. We think (ACOs) are going to make a real difference in cost. They’re going to make a real difference in quality and the biggest challenge that we will face are having enough seasoned and experienced medical directors and physician leaders. Physician leadership on the ground makes the difference. 

Q. Why do you think the public is still split on the federal health law?

A. The health care law has many pieces to it. The consumer protections that have been put in early on, I think, are well regarded. I think everyone agrees that it is time to get away from a system of determining a person’s health insurance by virtue of their health status. And so, doing away with preexisting conditions was overdue. 

Any change is scary until you put it in place and then it seems like it was the natural thing to do two years later.

This law will continue to go through some changes, I’m sure. There’s a lot we’re going to have to experiment with and I hope we’ll be encouraging HHS and the government to allow states to experiment. If we get only the people that need care in the system, it’s obvious that premiums will go up beyond what anyone can pay and that won’t be a success or sustainable. So, while we think it is something that over time people could accept, we need to do this in stages.

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In to its on the nation’s budget and economic outlook, CBO said that outlays for Medicare will total 3.7 percent of the gross domestic product in 2013, rising to 4.3 percent of GDP in 2022, as enrollment in the program increases.

But the report also noted that for the third year in a row, CBO expects the growth in Medicare spending in 2012 to be “substantially slower” than anticipated earlier in the year.

CBO Director Doug Elmendorf said at a press conference that the slower growth in Medicare is consistent with slower health care cost growth throughout the economy, which many analysts have observed. But he said it’s still the slowdown is happening.

“Presumably, the weak state of the economy is a factor, but given the magnitude of the slowdown in national health spending and the timing of that slowdown, which seems to have started before the recession, we and most analysts think there are probably structural factors at work as well,” he said. Those structural factors could include slower growth of spending on prescription drugs, changes in the health care delivery and payment system, and higher out-of-pocket spending for consumers, according to Elmendorf.

The report also looked at Medicaid. Federal outlays for the program are expected to total 1.7 percent of GDP next year and 2.4 percent of GDP in 2022 as the program expands under the 2010 health law. In comparison to its though, the CBO said Medicaid spending would decrease by $325 billion, or 7 percent, from 2013 to 2022. The bulk of that reduction is due to the Supreme Court’s ruling on the health law, which makes optional an expansion of the program that the law essentially required all states to put in place.

Overall, CBO said that the economy could return to a recession in 2013 if lawmakers do not avoid a set of tax increases and spending reductions that will take effect in January, a deadline often referred to as the “fiscal cliff.”

Physicians face a 27 percent cut in their Medicare payments next year unless lawmakers forestall the hit. Congress historically has acted to avoid such cuts, which are the result of a formula known as the sustainable growth rate. CBO said that holding Medicare physician payment rates at current levels next year would cost $10 billion, and a total of $245 billion if they were left unchanged through 2022.

But even if Congress averts the fiscal cliff and a recession, the economy cannot sustain the high debt levels that would result in the long term if current tax and spending levels are left unchanged, according to Elmendorf.

“The key issue facing policymakers is not whether to reduce budget deficits relative to those that would occur under current policies. The question is when; the question is how,” he said.

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They’ve adopted a strategy known as a “learning health system,” which creates a feedback loop of sorts between the system’s medical and research sides, including the .  In broad terms, researchers help doctors evaluate new ways of providing care, and doctors suggest areas where research is needed — meaning evidence and practice exist in a cycle.

In for the Annals of Internal Medicine, officials at Group Health describe the idea of the learning health system and how it’s making a difference there.

Eric Larson, a co-author of the paper, said that health care innovations traditionally take years to make their way into doctors’ offices. That delay means new ideas aren’t being tested quickly to weed out those that don’t work, and patients aren’t rapidly getting the benefit of those that do.

“That wait is just lost gain for patients and for public health,” said Larson, vice president for research at Group Health and executive director at the Group Health Research Institute.

One important piece of the learning health system at Group Health is the Partnership for Innovation. Under that program, clinicians propose ideas for delivery system reform, and researchers help shape selected ideas into workable projects that can be evaluated.

The learning health system model has played a key role in various Group Health initiatives, including its move to patient-centered medical homes, an opioid-prescribing safety initiative and evaluating high-end imaging use.

Matt Handley, the medical director for quality and informatics at Group Health, said the model means implementation of new ideas and research on them can happen simultaneously, and makes it easier for doctors to evaluate changes in how they deliver care. That doesn’t always happen when health systems around the country try new things.

“Because their intention is good, they assume the outcomes are good,” he said. “And that’s not always the case.”

Group Health long has embedded research into its system, but a turning point in the system’s embrace of the learning health system concept came in 2007 when Group Health decided to try a new way of providing primary care through patient-centered medical homes.

Rather than clinicians implementing the program and researchers studying the results, the two groups worked together from the onset. Researchers shared the latest findings on primary care with clinicians and evaluated the medical homes as they were developed on a pilot basis. By 2009, the model had spread to all 25 Group Health medical centers because of positive findings by the researchers.

Sarah Greene, director of strategy and business development at Group Health and the lead author of the paper, said that two key components of a learning health system are having people in place who span the research-clinical divide and can help information flow between the two sides, and having a culture that is intensely curious and values improvement.

“It requires a degree of vulnerability to say we want to learn more,” she said.

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The economists said in for the New England Journal of Medicine that while the 2010 federal health law aims to slow health spending through programs such as value-based purchasing and bundled payments, it fails to alter fundamentally the health care financing system. The paper was authored by Joseph R. Antos of the conservative-leaning American Enterprise Institute, Mark V. Pauly of the University of Pennsylvania, and Gail R. Wilensky of Project HOPE, a former head of the Medicare and Medicaid programs.

Their perspective appeared by 23 economists and health policy experts brought together by the liberal-leaning Center For American Progress who came up with a . The CAP group called for state spending targets; competitive bidding for medical devices, laboratory tests and other Medicare services; and changing the  traditional way doctors and hospitals are paid for every service.

Journal editors said they presented the differing approaches to stimulate conversation about how best to deal with health care costs.

The conservative thinkers said that changing Medicare from a defined benefit to a defined contribution approach would give seniors an incentive to choose lower-cost plans, and give plans an incentive to provide more cost-effective services.  Their proposal is similar to , R-Wis., and incorporated into .

The economists did say, though, that setting statutory limits on subsidy growth—such as the gross domestic product plus 0.5 percent limit in the Ryan plan—can sometimes be problematic because they can threaten access to care and “medical progress.”  Those problems are common to all formula-driven spending controls, including the health law’s Independent Payment Advisory Board, they added.

“If competition can keep Medicare spending within the bounds set by the targets, then the targets are unnecessary,” they said.  “If not, price controls will do no better.”

The economists also recommended narrowing the unlimited tax subsidy for employer-sponsored insurance—under which most employees do not pay taxes on such coverage—which they said would have a similar effect.

“Reliance on competitive markets rather than on regulatory controls provides strong incentives for more efficient delivery of the health services that consumers truly value,” they said.

In their paper arguing for a market-based approach, the economists said that seniors in Medicare would receive a subsidy to purchase insurance from a variety of plans that include traditional Medicare and all of which provide a core set of benefits. The subsidy would be based on the low bids and would vary based on financial and health needs. Beneficiaries who wanted to buy a more expensive plan would pay the difference on their own.

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Romney on Monday highlighted the fact that Israel spends 8 percent of its gross domestic product on health care, compared with 18 percent in the U.S.

“We have to find ways — not just to provide health care to more people, but to find ways to fund and manage our health care costs,” he said at a breakfast fundraiser in Jerusalem, according to the .

So what exactly does health care look like in Israel?  A handy prepared for the Jewish Healthcare Foundation gives the rundown.  Here are some key features:

• Under the country’s 1995 National Health Insurance (NHI) law, Israelis can choose one of four, nonprofit health plans.
• The health plans must provide a benefit package set in law.
• Israel pays each plan a capitated rate that primarily takes into account the number of members and their ages.  Some funding is distributed based on how many members have rare but expensive conditions.
• The NHI system is financed mostly by income taxes, but 40 percent of the funding comes from out-of-pocket payments, such as co-pays or supplemental insurance purchases.
• The Ministry of Health operates about half of the country’s hospital beds.

Romney’s comments rocketed around the blogosphere as that the Israeli system is highly centralized — and similar in some ways to the federal health law that Romney has vowed to repeal.  For example, Israel’s requirement that everyone have insurance is much like the individual mandate.  Plus, as Sarah Kliff explained on the Washington Post’s , researchers have attributed Israel’s ability to hold down costs without skimping on quality to the “strong government influence” over the system.

A Romney spokesman that his comments were not intended to praise the entire Israeli system but simply to comment on the need to lower costs in the U.S.

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States continue to struggle with Medicaid costs, a factor that looms over their tepid economic recovery, according to a released Tuesday.

The economic outlook for the states is starting to brighten, but growth is slow and budgets still are tight, said the  and the in their semi-annual fiscal survey of the states.

Part of the problem is Medicaid. While state spending on the program isn’t expected to grow as dramatically in the coming year as it did in the past two years, the costs still are a burden, according to the report.

“With the growth of Medicaid expenditures, spending priorities will again face competition for state budget dollars this fiscal year,” said Dan Crippen, the executive director of the NGA, in a statement.

The reasons for the spending growth include the lackluster labor market, which means fewer people are insured through their jobs and instead turn to Medicaid for coverage, and the growth in costs throughout the health care system, according to the report.

The federal government currently pays at least half and as much as three-quarters of Medicaid costs, . The 2010 health law calls for a massive expansion of the Medicaid program and the federal government will cover 100% of the cost for the new beneficiaries for the first few years (gradually reducing that to 90 percent by 2020).

State Medicaid spending is forecast to increase 3.9 percent in fiscal year 2013, which begins July 1 for most states, based on governors’ budget proposals.  That’s down from 20.4 percent the previous year, as states no longer received extra money they had gotten from the federal government because of  the .

But, the Medicaid spending growth rate is expected to outpace the growth of overall general fund expenditures, and, during the past 10 years, Medicaid growth has exceeded the increases in all other categories of state spending, according to NGA and NASBO.

That means states still are looking for ways to cut costs, after years of provider rate reductions, benefit cuts, and other cost containment measures.   The report said states will continue to take actions such as reducing or freezing rates, but they also are looking at longer-term strategies such as expanding managed care or efforts to prevent fraud and waste.

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Mayor Vincent C. Gray (D) earlier this spring cutting hospital-based care from the to save more than $20 million in the District’s budget, which begins in October.  The alliance covers about 19,000 people, most of whom are illegal immigrants.

But District Council member David A. Catania (I-At Large), who chairs the health committee, opposed the cuts, arguing that they would diminish care for an already vulnerable population that should not be treated differently because of its immigration status, according to his spokesman Brendan Williams-Kief.

The alliance was set up to cover low-income city residents who are ineigible for Medicaid, but the 2010 federal health law opened the joint federal-state program to many of those people. That expansion does not cover illegal  immigrants, however, who now make up the bulk of the alliance program.

After weeks of political wrangling, the mayor and council settled on a compromise that preserves the alliance’s hospital benefits through tweaks and trims to other District health programs and an expected increase in federal funding for emergency treatment.

Both Catania and Gray praised the compromise in .

“Today’s agreement ensures that all low-income District residents are treated equally and afforded the dignity of comprehensive, high quality health care,” Catania said.

Gray said he is “delighted” the compromise maintains the Alliance funding and protects other health care programs.

“The plan addresses my concerns and the concerns we heard from many community organizations, while ensuring Alliance beneficiaries will continue to receive critical health-care coverage,” he said.

The council approved the budget by a vote of 12-0.  A final vote is scheduled for June 5.

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Finding high-quality, cost-effective ways to care for the 9 million people known as “dual eligibles” is among the brass rings of health policy.  The population includes some of the sickest and poorest Americans who must navigate a fragmented system that can impede their care. Managing their care is important because they account for a disproportionate share of health spending — they account for approximately 20 percent of Medicare’s beneficiaries, for instance, but 31 percent of its spending, and 15% of Medicaid beneficiaries, but nearly 40 percent of that program’s spending, according to , the director of the Medicare-Medicaid Coordination Office.

Bella said Tuesday that more than half the states have expressed interest in testing of care for dual eligibles. Twenty-five states have posted their plans for public comment, and seven already have submitted their plans to the federal government. The first wave of states is expected to go live with their plans in January 2013, according to Bella, who spoke at a panel discussion on dual eligibles held by the American Enterprise Institute.

However, Patricia Nemore, an attorney at the , said advocates are nervous about whether the plans do enough to protect dual eligibles, and more time would help ensure those concerns are addressed.  The states may pledge to protect beneficiaries in a general sense, but their plans need to be concrete, she said.

Bella said that questions about how fast to move are legitimate, but that it’s important for officials to act with urgency to get new models off the ground.

“Everywhere I go I get a group of people telling me we’re moving too slow and a group of people telling me we’re moving too fast,” she said.

This article was produced by Kaiser Health News with support from .

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