Friday Five: Top 5 healthcare business news items from the MCOL Weekend edition

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Every business day, MCOL posts feature stories making news on the business of health care. Here are five we think are particularly important for this week:


U.S. appeals court blocks Anthem bid to merge with rival Cigna

A U.S. appeals court blocked health insurer Anthem Inc's (ANTM.N) bid to merge with Cigna (CI.N) on Friday, upholding a lower court's decision that the $54 billion deal should not be allowed because it would lead to higher prices for healthcare. Reuters April 28, 2017


4 key questions surrounding Obamacare repeal

House Republicans are mounting yet another effort to tear down Obamacare and remake the health care system — but the path to delivering on one of the GOP's longest-standing priorities remains complicated and fraught with uncertainty. Politico April 27, 2017


Amid budget talks, White House says it will continue ACA subsidies

The White House on Wednesday pledged to continue payments critical to the success of Affordable Care Act exchanges, Politico reports. The pledge will come as a relief to insurers and providers after the administration’s earlier indication that it might withhold payments as a bargaining chip in this week’s budget negotiations.

Stat News April 26, 2017


PBM Express Scripts loses biggest client Anthem

Express Scripts said Monday that its biggest client, Anthem, will not renew its contract with the pharmacy benefit manager after the current agreement expires at the end of 2019.

Modern Healthcare April 24, 2017


Health Care In America: An Employment Bonanza And A Runaway-Cost Crisis

In many ways, the health care industry has been a great friend to the U.S. economy. Its plentiful jobs helped lift the country out of the Great Recession and, partly due to the Affordable Care Act, it now employs 1 in 9 Americans — up from 1 in 12 in 2000.

Kaiser Health News April 24, 2017


These and more weekly news items on the business of healthcare are featured in the MCOL Weekend edition, along with the MCOL Tidbits, and more, for MCOL Premium level members.


What Goes into Combating Healthcare Fraud

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By Claire Thayer, April 27, 2017

According to the National Health Care Anti-Fraud Association, most health care fraud is committed by organized crime groups and a very small minority of dishonest health care provider. The NHCAA tells us that the most common types of fraud include:

·         Billing for services that were never rendered-either by using genuine patient information, sometimes obtained through identity theft, to fabricate entire claims or by padding claims with charges for procedures or services that did not take place.

·         Billing for more expensive services or procedures than were actually provided or performed, commonly known as "upcoding"-i.e., falsely billing for a higher-priced treatment than was actually provided (which often requires the accompanying "inflation" of the patient's diagnosis code to a more serious condition consistent with the false procedure code).

·         Performing medically unnecessary services solely for the purpose of generating insurance payments.

·         Misrepresenting non-covered treatments as medically necessary covered treatments for purposes of obtaining insurance payments-widely seen in cosmetic-surgery schemes, in which non-covered cosmetic procedures such as "nose jobs" are billed to patients' insurers as deviated-septum repairs.

·         Falsifying a patient's diagnosis to justify tests, surgeries or other procedures that aren't medically necessary.

·         Unbundling - billing each step of a procedure as if it were a separate procedure.

·         Billing a patient more than the co-pay amount for services that were prepaid or paid in full by the benefit plan under the terms of a managed care contract.

·         Accepting kickbacks for patient referrals.

·         Waiving patient co-pays or deductibles for medical or dental care and over-billing the insurance carrier or benefit plan (insurers often set the policy with regard to the waiver of co-pays through its provider contracting process; while, under Medicare, routinely waiving co-pays is prohibited and may only be waived due to "financial hardship").

While the U.S. Department of Justice, FBI, CMS and other government entities are busy identifying and tracking down fraud schemes, Deloitte research points out that an emerging area of interest in health care fraud and abuse enforcement is that of relationship scrutiny.

This weeks’ edition of the MCOL Infographic, co-sponsored by LexisNexis, highlights some of the costs associated with fighting healthcare fraud:

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What goes into combating healthcare fraud?

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MCOL’s weekly infoGraphoid is a benefit for MCOL Basic members and released each Wednesday as part of the MCOL Daily Factoid e-newsletter distribution service – find out more


Clicks-and-Mortar: Health Care's Future

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By Kim Bellard, April 27, 2017


The woes of the retail industry are well known, and are usually blamed on the impact of the Internet.  Credit Suisse projects that 8,600 brick-and-mortar stores will close in 2017, which would beat the record set in 2008, at the height of the last recession.   And then there's health care, where the retail business is booming.


In a recent Wall Street Journal article, Christopher Mims set forth Three Hard Lessons the Internet is Teaching Traditional Stores.  The lessons are:

1.             Data is King

2.             Personalization + Automation = Profits

3.             Legacy Tech Won't Cut It


It's easy to see how all those also apply to health care.


But health care is different, right?  Patients want to see their physician.  That physical touch, that personal interaction, is a key part of the process.  It's not something that can be replicated over a computer screen.  


Yeah, well, the retail industry has been through all that.  Retail once primarily meant local mom-and-pop stores.  They knew their customers and made choices on their behalf.  But it was all very personal.


Still, though, when Amazon came along, booksellers were adamant: no one wants to buy books sight unseen!  When that truism was proven false, other sectors of retail had their turn in the Internet spotlight, and the last twenty years of results haven't been pretty for them.  


It turns out that the personal touch isn't quite as important as retailers liked to think.


So why hasn't health care been more disrupted by the Internet?  Well, for one thing, when you buy a book online, your state doesn't require that you buy it from a bookstore that is licensed by its not-so-friendly licensing board, as is true with seeing doctors over the internet.  

Strike one for disruption.

For another thing, we (usually) trust our doctors.  Then again, we used to trust recommendations from bookstore staff too.  That is, when they had time for us, if they seemed knowledgeable, and if they were making recommendations that fit us rather than just their own preferences.

Think the same thing won't happen when AI 
gets better at diagnoses? 

Let's go back to Mr. Mims three lessons and see how they apply to health care:

·         Data is King: Health care collects a lot of data, and will get even more with all the new sensors.  The big tech companies know their customers very well and tailor interactions accordingly; health care must as well.

·         Personalization + Automation = Profits:, We're stuck in waiting rooms, filling out forms we've already filled out elsewhere. That is not a personal experience that can survive in the 21st century.  It has to be smoother, faster, and friction-less.  

·         Legacy Tech Won't Cut It: EHRs that no one likes.  Claims systems that take weeks to process a claim.  Billing processes that produce bills no one can understand.   The list could go on almost indefinitely.  All too often, health care's tech is not ready for prime time.  


The question is, are health care's leaders learning these lessons?


The future of retail appears to be in "clicks-and-mortar" (or "bricks-and-clicks").  


Health care can act like B Dalton or Borders, assuming until it is too late that their consumers will visit them in person, because they always had.  Or it can act now to jump to the data-driven "clicks-and-mortar" approach that other retail businesses are moving to.  


Health care organizations which get that right will be the one to survive.  

This post is an abridged version of the posting in Kim Bellard’s blogsite. Click here to read the full posting


6 Ways to Improve Your Member Communications

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 By Claire Thayer, April 24, 2017

Change Healthcare doubled member engagement for a regional health plan after introducing engagement best practices with a marketing mix that included email, blog posts, social media, a direct mail campaign, presentations to key group leaders and on-site workshops.

This special edition of the MCOL Infographic, co-sponsored by Change Healthcare, identifies 6 effective ways for health plans to improve communications with members:

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(Click to Enlarge Image)


MCOL’s weekly infoGraphoid is a benefit for MCOL Basic members and released each Wednesday as part of the MCOL Daily Factoid e-newsletter distribution service – find out more here.



How Do You Build a Culture of Innovation at a Healthcare Organization?

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By Clive Riddle, April 21, 2017


Now that we’re thirty days in the Spring of 2017, nurturing seedlings with hopes of taking deeper root should be on the mind of every healthcare gardener. Along these lines, the current issue of Healthcare Innovation News asks their panel the question, “How Do You Build a Culture of Innovation Within Your Organization?” Here’s some excerpts from what these sowers of innovation seeds had to say:


David R. Strand, Chief Executive Officer of Life Cross Training, based in Chicago, says in part, “We often point to technology advances as “innovation” in healthcare. Yet, the next real innovation in healthcare will come from our investments in human capital—investments in the people we count on to deliver high-quality care and a great patient experience.  Addressing this problem requires comprehensive, innovative solutions focused in three distinct areas: (1) Improving the practice environment. Systematically identifying and eliminating hassles from technology to process to organizational design and identifying and accentuating those things that bring joy to clinical practice; (2) Aligning teams around common values and shared goals. Establishing guiding principles for interactions with one another and with patients and building cultures that support the well-being of both patients and clinicians; (3) Providing clinicians with evidence-based skills driving individual well-being. Ensuring that clinicians are better equipped to handle the intrinsic stress associated with their work and busy lives.


James Polfreman, CEO and President of Solis Mammography based in Addison, Texas echoes the theme that technology is not enough, sharing that  “In the field of women’s breast health, innovation is not only measured in terms of technology and clinical accuracy, but also in areas of patient service, convenience and care to ensure annual compliance and repeat business.” He advises that “to foster innovation, an environment must be actively cultivated to promote openness and collaboration in order to tap into the natural passion of employees. This type of environment benefits the entire team and translates into superior patient care Well-informed teams are vital. Communication of a crystal-clear vision and mission is fundamental……When new ideas are implemented, having clear processes in place from training to implementation is key…..Consistently challenging the status quo motivates initiative….. Finally, a culture of innovation is maintained through leadership by example, repetition and affirmation of a job well done. This influences how you attract, recruit, retain, train and reward teams.”


Joanna Engelke, Managing Director at Halloran Consulting Group in Boston counsels in part that “there are numerous best practices cited to support an innovative culture: (A) Enabling employees to spend 5% to 10% of their time on freethinking and creating “skunkworks” projects—those dedicated solely to radical innovation; (B) Creating office designs that encourage “bumping into each other” with lots of light, mobile whiteboards, huddle rooms, collaboration centers and games; (C) Investing in an internal, venture capital-like fund with all the trappings of pitches, business plans, proof of concept and funding milestones that are outside a regular product development arena; (D) Sponsoring crowd-sourced, problem-solving fairs for internal and external participation; (E) Surveying employees to gain an understanding of internal practices that block or prevent innovation; (F)                 Rewarding innovation in each department of an organization.” But Joanna reminds us, “the real secret sauce to an innovative culture is very basic: Management must pay attention.”


Finally, Summerpal Kahlon, M.D., Director of Care Innovation at Oracle Health Sciences, based in Satellite Beach, Florida, says we need to listen. “Listening is a key skill in healthcare.” In particular he advocates listening to data through analytics. He cites these as examples that can drive innovation – “There are a few high-value, rich sources of information that can provide interesting lifestyle insight: Demographic information, including occupation, income and family/social environment; Environmental data, including census, local crime statistics and accessible parks/recreation; and Retail data, particularly for grocery and drugstores.”