A Working Man’s Plan to Reform Healthcare
August 6, 2009 | General
Background:
- I worked in the healthcare industry for 10 years, in administration and finance, as a Registered Nurse and as hospital business office, IT systems and clinical consultant. I worked in California, Texas, and Louisiana. While working in Hospital Administration and finance I managed patient financial services which dealt with access to services, pre-certification of services for insurance purposes, and the collection of payment for service provided. I also developed an interface between a clinical practice analysis tool and patient financial information which allowed one major hospital to identify best practices based on outcomes and cost associated with specific services provided and the level of co-morbidities associated with the service. As a nurse I worked in Burns Intensive Care, Med-Surg and long term care and rehabilitation.
Facts:
- Hospitals must hire and train large patient financial services staff in order to properly pre-certify patients and collect for services rendered.
- Every insurance company has its own guidelines on what is covered and when pre-certification is necessary, without pre-certification insurance companies will not pay for services. In some cases the insurance company provides pre-certification staff to the hospital / care provider during the normal work week. Emergency care is provided w/o pre-certification.
- Insurance companies employ large staffs to sell insurance policies, provide subscriber services, and review claims.
- Insurance companies are slow to pay the average days in accounts receivable for insurance claims was 90 nationwide between 1992 and 2001.
- Care providers partially base their charges for services on expected reimbursement for services, one hospital I worked at as a consultant went from being 22 million in the black to 20 million in the red in the span of a year after managed care carriers became prevalent in Louisiana. The reason, days in accounts receivable averaged 270, and reimbursement rates averaged 32% of cost.
- Most healthcare providers will set up payments plans directly with the patient if no insurance is provided. When doing this the cost of services can be lowered by as much as 50% below the same service when insurance is provided.
- Medicare and Medicaid have enormous amounts of fraud waste and abuse as a result of government regulation and lack of oversight.
What is wrong with the governments new plan?
- It penalizes people for not buying insurance?
- It raises our taxes to support the insurance companies, not to ensure we receive quality healthcare – the two are not the same thing. Most Americans can get quality healthcare when they need it.
The Solution:
- Provide tax credits to people who have preventive care on a regular basis and don’t abuse drugs (alcohol, cigarettes, prescription drugs included) or food, allow medical savings plans that don’t force you to lose money if not spent in any given year. This could be used to fund item 2.
- Establish a medical sinking fund for all Americans which pays for catastrophic care only.routine care is and should remain a personal
responsibility. - Establish national standards for the cost of services based on outcomes and best practices. The system to do this has been used for at least the last ten years.
- Allow patients to die with dignity.you should not be forced to vegetate because someone feels guilty or has a God complex.
Larry
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Comment by Gordon August 6, 2009
1. Your item 1 provides nothing for low income people who can’t afford preventative care and don’t have extra money to put into medical savings accounts. What about them?
2. You say, “routine care is and should remain a personal
responsibility” What if you can’t afford it?
2. You advocate “a medical sinking fund for all Americans which pays for catastrophic care”. This is a good idea. Who administers the sinking fund and decides how it is to be doled out? It has to be some public entity, doesn’t it? (as opposed to private insurance companies)
3. Establishing national standards is a good idea.
4. Allowing patients to die with dignity is a good idea.
Comment by Beth August 11, 2009
I think that all hospitals, no matter where they are or how big, should have to charge the same prices…to the insured and uninsured. Why should I be penalized because an insurance company won’t cover me.
My husband is unemployed and uninsured. Recently he was rushed to the ER for a life threating accident. Our total bill–$27,000.00. Just for the hospital. They charged him $111 for one pill that would cost $3 at the pharmacy. And I know that they inflated the cost because he has no insurance and they know that they can do it because there are no one there to help the uninsured and the poor.
Tell me, from all you experience and your excuses, how do you justify that.
Comment by Jim Y August 13, 2009
You’re right on the training part for patient accounting staff and insurance companies not paying all that quickly. Some of those other numbers seem a bit off, and I’ve been in health care finance for more than 25 years. It would seem that the entire state of Louisiana would have collapsed with receivables around 270.
Comment by Mitch August 13, 2009
I’ve been in healthcare finance for over 25 years, and it seems to me that some of those numbers have to be off. when I was director of patient accounting in 1995, the national standard was 70 days in outstanding receivables, and any hospital that was around 270 days would have been closed before the year ended because they wouldn’t have had any money to pay anyone.
Having said that, I have my issues with the healthcare plan, but it’s mainly because we have no real idea what’s in the healthcare plan yet. We have no idea who or what will be covered. We have no idea how it’ll be paid for, especially since one of the main caveats of the Obama Administration’s plan is that it doesn’t add to the deficit. Many of us in health care finance are pulling for the plan deep down inside, but our minds are saying there’s no way conceivable to produce a far reaching plan that win’t raise the deficit.
If Congress can pull this one off, they should all get medals. I just don’t see that happening, though.
BTW, hospitals do NOT inflate prices depending on whether people have insurance or not; that’s against the law. What they DO, though, is have adjustments for those with whom they’ve contracted with; that’s allowed. Many hospitals across the country are now coming up with “contracts” for self pay people that are equal to the best insurance contract they have, excluding Medicaid or Medicare rates, to at least level the playing field some.
Comment by gloria September 18, 2009
If you have comments, here are some phone#’s that may come in handy: obama 202 456-1414 vice pres 202 456-9000 and pelosi 202 225-4965 or go to congress.org. Another interesting thing to do is watch c-span. There you can hear congress and senate live. I believe we should not be fined large fines if we can afford health care, and we need to do more than reform insurance. That is just the surface of the problem. Why couldn’t doctors work for hospitals? There is one in the country where the doctors have their offices in the hospital, receive a salary and share cost of equipment. Why couldn’t we get costs down for doctors by making college cheaper, regulating drug companies, cost of equipment, all of which is passed on to us in charges. I also believe we employ the washington people and if they are failing us we need to fire them vie our vote. Everyone needs to be more aware of the constitution and making sure our rights are not slowly taken away under the guise of government helping us! The american people have always helped themselves even in bad times. I believe if we analyze things we will find that government now has a forty percent stake in business, at least a grab for 18 percent of education and how much for health care? I am concerned not because I am out of the way but because I am a concerned American citizen. And I might add, do not belong to any groups.