News/Blog

2018 September

Plenty of blame to go around for high health costs

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Health care costs remain a leading issue ahead of this year’s midterms, and voters have plenty of blame to go around, according to the Kaiser Family Foundation’s (KFF) latest tracking poll.

KFF health tracking poll of 1,201 US adults (Aug/2018) asked whether certain factors are a “major reason” health care costs are rising.

  • Blame for the potential political culprits — the ACA and the Trump administration — was split about evenly
  • But there’s a broader bipartisan agreement that industry is to blame: > 70% faulted drug companies, hospitals, and insurers
  • Doctors caught a break, at 49%
  • Partisanship reigns, though, on the question of whether President Trump will help
  • 13% of Democrats are at least somewhat confident that Americans will pay less for prescription drugs under the Trump administration, compared with a whopping 83% of Republicans. Independents generally share Democrats’ skepticism
  • Roughly a quarter of Democrats and roughly two-thirds of Republicans think Trump’s public criticism of drug companies will help bring down prices
  • Surprise hospital bills haven’t attracted the same political uproar as prescription drug costs, but the Kaiser poll provides more reason to believe they could be the next big controversy
  • 67% said they’re “very worried” or “somewhat worried” about being unable to pay a surprise medical bill
  • 53% fear they won’t be able to pay their deductible
  • 45% are afraid of the tab for their prescription drugs
  • 39% experienced a surprise bill in the past year

 

A little-known windfall for some hospitals, now facing big cuts

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Research corroborates that hospitals aren’t using the 340B program as intended.

  • The 340B program may have raised costs by encouraging care in 340B-eligible hospitals that could have been provided less expensively elsewhere
  • The program also encourages providers to use more expensive drugs
  • Medicare lowered the prices it pays for 340B drugs by 27%. But it does little to address how much insurers and individuals pay for prescription drugs or the value they obtain from them

How to tame healthcare spending? Look for 1% solutions

Posted by | Health News, Hospital Finance | No Comments

A working paper published Monday proposes one possible fix. In the 1980s, Congress carved out a small group of hospitals from its normal rules for payment. These “long-term care hospitals,” which treated patients with tuberculosis and chronic diseases, could earn far more money than traditional hospitals and nursing homes if they cared for patients who stayed with them for an average of 25 days. Since then, the number of these hospitals has mushroomed, from a few dozens to more than 400, most run by two for-profit chains.

For years, analysts and policymakers have wondered about the value of these hospitals, which tend to treat very sick patients who need a lot of care, such as mechanical ventilation or dialysis. Several analyses have suggested that Medicare may be overpaying for their services. And Congress has made some small changes to limit the number of patients who are eligible for such care.

The new paper, from researchers at the Massachusetts Institute of Technology, Stanford University, and the University of Chicago, took a close look at what happened to patients as new long-term care hospitals opened around the country in places that had none.

The study, covering 1990 to 2014, found that when such a hospital opened, the odds increased that very sick patients leaving a normal hospital would end up going next to a long-term care hospital, generating a growing bill for both Medicare and the patients themselves. But the researchers found no benefit when it came to patients’ chances of dying or going home within 90 days.

The researchers concluded that the healthcare system could probably save a lot of money — around $5 billion a year — by paying the long-term care hospitals the same prices that are paid to skilled nursing facilities, the places that most long-term patients end up in when there is no long-term care hospital nearby.