According to a recent survey of young adults ages 19 to 9

67% took health insurance benefits through an employer when offered. For those who did not enroll in an employer health plan, the main reasons given were: • They were covered by a parent, spouse, or partner (54%) • They couldn’t afford the premiums (22%). • They felt they didn’t need insurance (only 5%) Source: "New Survey of Young Adults: 7.8 Million Gained New or Better Coverage Through Affordable Care Act, But Only 27 Percent Are Aware of Health Insurance Marketplaces; Millions Will Remain Uninsured If States Don’t Expand Medicaid," The Commonwealth Fund, August 20, 2013, http://www.commonwealthfund.org/News/News-Releases/2013/Aug/New-Survey-of-Young-Adults.aspx

OIG: Medicare, RACs Botch Audits

Published: Sep 5, 2013 By David Pittman, Washington Correspondent, MedPage Today WASHINGTON -- Medicare's much criticized recovery audit contractors (RACs) may not be catching all overpaid claims and "high amounts of improper payment may continue," according to a government watchdog report. But, although RACs flagged half of all claims they reviewed as being improper in fiscal 2010 and 2011, the Centers for Medicare and Medicaid Services (CMS) didn't evaluate the effectiveness of those actions, the Health and Human Services' Office of the Inspector General (OIG) said. Therefore, it's difficult to know if the RACs' actions changed provider behavior. Furthermore, CMS hasn't taken action on referrals for potential fraud and hasn't evaluated the performance of all metrics in the RACs' contract, the report said. "CMS reported that it had not evaluated corrective actions because of lack of resources and the difficulty in determining causal relationships between corrective actions and reductions in improper payments," the OIG said in a report on Medicare's RACs issued Tuesday. "CMS also reported that some corrective actions should be in place for several years before it evaluates them." To assess the effectiveness of the oversight of RACs, the OIG collected and analyzed data on recovery activities and CMS oversight and performance evaluations. "OIG has identified vulnerabilities in CMS' oversight of its contractors," the report stated. "Given the critical role of identifying improper payments, effective oversight of RAC performance is important." Medical societies, including the American Medical Association, have been outspoken in their negative feelings toward RACs, at one point calling them "bounty hunters." Groups have called the RACs' work burdensome and intrusive to providers while referring to their incentive structure as "perverse" since their pay is dependent on the amount of money they save CMS. But the RAC program has drawn criticism outside of provider groups. The Government Accountability Office in 2010 said CMS hadn't addressed 60% of improper payment vulnerabilities spotted during an earlier demonstration project. The RACs' work has recently drawn the attention of the Senate Finance Committee, where this summer Chairman Max Baucus (D-Mont.) said CMS should expand the program but not place any more burdens on providers. In fiscal 2010 and 2011, contractors spotted improper payments totaling $1.3 billion, according to the OIG, and private payers have started to launch similar RAC programs. But CMS took action on 28 of 46 specific areas that resulted in more than $500,000 in improper payments in fiscal 2010 and 2011, the OIG found. Examples included providers billing "add-on codes" without primary codes or indicating the incorrect place of service on claims. The OIG also found CMS didn't evaluate RACs' performance on all contract requirements. "Specifically, CMS did not evaluate RACs on the extent that they identified improper payments," the report stated. "Further, four of the eight performance evaluations that we reviewed did not describe RACs' ability, accuracy, or effectiveness in identifying improper payments." Other OIG findings include: • 32% of recovered payments were from services being delivered in inappropriate facilities and 25% from incorrect billing codes • 88% of improper payments were from inpatient hospitals and 5% from physician and nonphysician practitioners • Providers appealed 6% of RAC decisions • Nearly half (44%) of appeals were overturned The OIG recommended that CMS evaluate the effectiveness of corrective actions, develop additional performance metrics to improve RAC performance, and review all referrals for fraud. In a letter to Inspector General Daniel Levinson, CMS Administrator Marilyn Tavenner agreed with most of the OIG's findings. "CMS continuously implements corrective actions on potential and known vulnerabilities and has implemented a dynamic process for addressing these vulnerabilities," Tavenner wrote. Medicare's RAC program was authorized by Congress in 2003 through the law that created the Part D prescription drug program. Contractors identify overpayments and underpayments in Medicare Parts A and B and then are paid based on the percentage of improper payments recovered by CMS. http://www.medpagetoday.com/PublicHealthPolicy/Medicare/41413?xid=nl_mpt_DHE_2013-09-06&utm_content=&utm_medium=email&utm_campaign=DailyHeadlines&utm_source=WC&eun=g350341d0r&userid=350341&email=john@thebrokerageinc.com&mu_id=5344066

According to a recent survey of large employers,

44% currently have an on-site clinic in at least one of their locations, and 9% are expecting to build a clinic next year. Source: "Large U.S. Employers Project a 7% Increase in Health Care Benefit Costs in 2014, National Business Group on Health Survey Finds," National Business Group on Health News Release, August 28, 2013, https://www.businessgrouphealth.org/pressroom/pressRelease.cfm?ID=214

Today's Datapoint

25 … states will have approved Medicaid expansion under the Affordable Care Act once the Michigan House (which has already passed an expansion bill) concurs with a measure passed by the state senate on Aug. 26.

Quote of the Day

“I kind of predicted that there’d be a crop of PBMs popping up after the consolidation of the larger PBMs because the consolidations certainly bring service challenges to clients. What consolidations have brought is very robust pricing to their clients, especially in terms of pharmacy discounts and rebates, but the downside is that the client service is not as robust when you’re a big organization.” — Helen Sherman, Pharm.D., vice president at Solid Benefit Guidance, told AIS’s Drug Benefit News.

Today's Datapoint

More than 90% … of employers who contribute to multi-employer plans are well below the 50-employee threshold, and are not subject to the ACA mandates, according to Randy DeFrehn, executive director of the National Coordinating Committee for Multiemployer Plans.

Quote of the Day

“Ideally what you would do if you were building a data hub that needs this kind of information [for public exchanges], you’d put a piece together and test that. You test it, if you will, sequentially. We have to build and test simultaneously….It’s a big operational issue, but all systems are go for the first of October.” — HHS Sec. Kathleen Sebelius told The Washington Post for an article published on Aug. 25.