The Courier-Journal – 03/20/2022

Medical privatization The past Sunday, The Courier Journal published an exceptional investigative piece by U.S. News on nursing homes. The emphasis was on quality performance, primarily during the COVID-19 pandemic, but the real focus was on ownership and Trilogy Home Services, a private equity, real estate REIT. Here is a first hand look at the toxic mix of Wall Street and private equity firms injecting themselves into healthcare practices. According to the article, high death rates and shoddy care were commonplace, a likely outcome when profit becomes the driving force. Fast forward to what’s happening to traditional medicare today. Efforts are underway to privatize this highly valued and essential service to seniors — and the efforts are under the radar. Originally operating under the name of Direct Contracting Entities, organizers have now changed the name to the Medicare REACH program, no doubt to further confuse patients who could be enrolled without their knowledge or consent. Here is another example of Wall Street and private equity placing themselves between doctors and patients. If you like your traditional medicare, stand up and take notice. The long-term solution is single-payer, Medicare for All. Let’s get rid of health care privatization Charles M. Casper, Louisville, 40207

Here’s the link to the schedule of topics and panelists.

Our Healthcare System in Crisis: National Single-Payer

Over the weekend of March 11 to 13, the March for Medicare for All, in cooperation with other groups, broadcast a deep dive, non-stop, educational program into our health care system and why we must move the nation to improved Medicare for All. 

National experts, such as Dr. Ana Malinow and Dr. Steffie Woolhandler, and vital community leaders spoke on Our Broken Health Care System, Racism, People with Disabilities, the Mental Health Crisis, Why Improved Medicare for All must be National, and much more.

The videos are available at these links:  

Friday: https://www.youtube.com/watch?v=lDZpC0U6-38 “Our Broken Healthcare System, Explained”, “Our Broken Healthcare System, a Discussion”, and more!

Saturday: https://www.youtube.com/watch?v=ljTCyreGQl8 “Impacts of Disaster Capitalism on Healthcare”, “Racism in Healthcare”, “The Mental Health Crisis in the United States”, “Healthcare Disparities for People with Disabilities”, “Healthcare Workers Speak Out”, and more!

Sunday: https://www.youtube.com/watch?v=5j4Fr4m8Qn8 “The International Human Right to Health and Why National Single-Payer is the Way Forward”, “Why Improved Medicare for All Must be National”, “How’re We Gonna Pay for It?”, “Next Wave of Organizing”, and more!

Here’s the link to the schedule of topics and panelists.

Dear Secretary Becerra and Administrator Brooks-LaSure,

Thank you for your efforts to protect Medicare, a program vitally important to the health and economic security of seniors and people with disabilities. We are writing to express our concern about ACO REACH, a pilot program launched by the Center for Medicare and Medicaid Innovation (CMMI) as a rebranding of the controversial Direct Contracting model.

Unfortunately, REACH retains the most dangerous elements of Direct Contracting, and under the guise of promoting equity, provides even more opportunities for middlemen to profit at the expense of beneficiaries and the Medicare Trust Fund. If allowed to continue, REACH would completely transform Traditional Medicare by allowing third-party middlemen to manage seniors’ care, without seniors’ full understanding or consent.

A majority of seniors choose Traditional (fee-for-service) Medicare over Medicare Advantage — the version of Medicare run by commercial insurers — because they value the free choice of health providers and the power to manage their own care. However, millions of seniors who actively chose Traditional Medicare will be automatically enrolled into REACH entities, many of which will likely be run by for-profit businesses, such as commercial insurers, venture capital and private equity investors, and even dialysis centers.

Full letter

Story on Common Dreams

“ACO REACH is Direct Contracting in disguise,” said Dr. Susan Rogers, an internal medicine physician and president of PNHP. “This new model doubles down on Direct Contracting’s fatal flaws, inserting a profit-seeking middleman between beneficiaries and their providers.”

PNHP identified several ways that ACO REACH perpetuates the dangerous flaws of Direct Contracting.

First, like the DC model, ACO REACH will pay middlemen a flat fee to “manage” seniors’ health, allowing them to keep 40% of what they don’t spend on care as profit and overhead. “The ACO REACH payment model establishes a dangerous incentive for middlemen to restrict patient care, an incentive that has never previously existed in Traditional Medicare,” said Dr. Rogers.

Next, Traditional Medicare beneficiaries will still be automatically enrolled into ACO REACH entities without their full understanding or consent, and once enrolled cannot cannot opt out of an ACO REACH entity unless they change primary care providers. “Changing primary care providers is a burden for anyone on Medicare, but especially for those in rural and other underserved communities,” added Dr. Rogers. Full story

On February 2, 2022, PNHP President Susan Rogers, MD, testified at a hearing of the Senate Finance Committee’s Subcommittee on Fiscal Responsibility and Economic Growth. The topic was Medicare Financing, and she was invited by committee chair Sen. Elizabeth Warren to discuss Medicare Direct Contracting and the threat of privatization to Traditional Medicare.

“This was a historic moment both for PNHP and our campaign against Medicare privatization. When I led a delegation of physicians to the capitol just two months ago, almost no one in Congress had even heard of Medicare Direct Contracting (DC). Thanks to the hard work of PNHP members, this threat to the Medicare program is now being actively debated in the halls of Congress,” said Dr. Rogers. Below are some highlights from the testimony. You can watch a recording of the hearing HERE (Dr. Rogers’ opening remarks start at 42:50; DCE discussion at 1:49:30), find a full transcript of her remarks HERE, read her more detailed written testimony HERE, and share PNHP’s live-tweet of the hearing HERE.

Below is the delegation that delivered petitions opposing DCEs to Sec. of HHS, Xavier Becerra.

• 

by Kip Sullivan, PNHP Minnesota

Many of us have heard the statement that capitated direct contracting entities (DCEs) are allowed to keep 40 percent of their payments from CMS (Center for Medicare and Medicaid Services) or, conversely, they have an effective “medical loss ratio” of 60 percent. To my knowledge, the first time the public learned of the 60 percent MLR was last September when Berwick and Gilfillan announced it in their two-part article for Health Affairs.
Medicare Advantage, Direct Contracting, And The Medicare ‘Money Machine,’ Part 2: Building On The ACO Model | Health Affairs

Berwick and Gilfillan calculated the MLR from CMS documents describing the four “risk corridors” DCEs will be subject to. Yeah, I know, “corridor,” what the hell is that? It refers to the amount of savings and losses DCEs can incur. So, if the DCE spends 25 percent less than its “benchmark” (it’s target) for 2022, it can keep all of the (alleged) savings, and if it spends 25% more than its target, it will lose all of it. But if it spends more than 35% less than its target, it can’t keep the entire profit for itself; it keeps all of the first 25 percent, and “only” half of the next chunk — 25-35 percent. And so on: The DCE can only keep 25% of the next chunk or corridor (35-50 percent), and only 10% of the final corridor (50-100 percent).Um hmm, I know, it’s nuts to plan for a DCE totally eliminating all medical costs for its assignees, but that’s the mindset at CMS these days.

So, if you multiply each corridor times the percent CMS allows the DCE to take to the bank, you get this table:

Corridor 1 (<25%): 1.0 x 25% =  25%
Corridor 2 (25-35%): .5 x 10% =  5%
Corridor 3: (35-50%): .25 x 15% = 4%
Corridor 4: (>50%): .1 x 50% =   5%
Total:                      39%

This means, to put it the other way around, that DCEs must spend a minimum of 61 percent of their loot on patients. The other 39 percent can finance yachts and stuff.

You can find a discussion of this delightful topic at pages 27-28 of this document, and a table laying out the numbers above (Table 6-7).

Direct Contracting Model Request for Application Global and Professional Options (cms.gov)

You can fight more effectively for single payer health care when you understand health policy. Here you have access to a slide set from Drs. Steffie Woolhandler and David Himmelstein. For instance, this slide shows that in traditional Medicare only a little over 2% goes to overhead, while in the private, for-profit Medicare Advantage plans almost 14% goes for overhead and profit. Learn and share. Knowledge is powerful.

The letter was a response to this article in the C-J.

Over 50 Congresspersons, including Rep. John Yarmuth of KY, call on the Biden Administration to end the Direct Contracting Entities (DCEs) that are privatizing traditional Medicare.

Press release

The letter to Health & Human Services Secretary Xavier Becerra signed by 54 representatives

Physicians for a National Health Program’s many resources, articles, and media links about the fight to end the DCEs.