Cost Control under ACA

[MeBelle]

This wasn't supposed to happen.

Before anyone gets into a lather about this first read the link.


Associated Press
WASHINGTON (AP) — The Obama administration has given the go-ahead for insurers and employers to use a new cost-control strategy that puts a hard dollar limit on what health plans pay for some expensive procedures, such as knee and hip replacements.

The new strategy works like this:
Your health insurance plan slaps a hard limit on what it will pay for certain procedures, for example, hospital charges associated with knee and hip replacement operations. That's called the reference price.

Say the limit is $30,000. The plan offers you a choice of hospitals within its provider network. If you pick one that charges $40,000, you would owe $10,000 to the hospital plus your regular cost-sharing for the $30,000 that your plan covers.

The extra $10,000 is treated like an out-of-network expense, and it doesn't count toward your plan's annual limit on out-of-pocket costs.

That's crucial because under the health care law, most plans have to pick up the entire cost of care after a patient hits the annual out-of-pocket limit, currently $6,350 for single coverage and $12,700 for a family plan. Before the May 2 administration ruling, it was unclear whether reference pricing violated this key financial protection for consumers.

"The problem ... from the patient's perspective is that at the end of the day, that is who gets left holding the bag," said Karen Pollitz of the nonpartisan Kaiser Family Foundation. Previously she was a top consumer protection regulator in the Obama administration.

 

[Politico]

You think they ever cared about that. Bless your heart. And coverage limits are not cost controls.

 

[MeBelle]

You think they ever cared about that.

No. Another new rule, cool, huh?

Bless your heart.

If you think I don't know what ^^^ means^^^.

And coverage limits are not cost controls.

Where was that stated?

 

[Politico]

My grandmother always said that to me when I was a kid. Never understood what it meant until later lol.

 

[MeBelle]

My grandmother always said that to me when I was a kid. Never understood what it meant until later lol.

That's horrible! Hope you outgrew it.

Bless your heart.

 

[Politico]

I didn't need to. She did though when I said go ahead say it again.

 

[emilynghiem]

Question:
So if insurance doesn't cover everything, and people are expected to pay the other costs.

What are the "means" (besides insurance) are people EXPECTED to use
to pay these other costs not covered by insurance--
and WHY are those means "fined" as NOT acceptable option or exemptions
for avoiding the tax penalty, if such ADDITIONAL MEANS of paying
are REQUIRED ANYWAY.

Since ppl have to use free market or other means of paying their costs anyway,
why are those options being fined where insurance is the only choice that isn't?

This wasn't supposed to happen.

Before anyone gets into a lather about this first read the link.


Associated Press
WASHINGTON (AP) — The Obama administration has given the go-ahead for insurers and employers to use a new cost-control strategy that puts a hard dollar limit on what health plans pay for some expensive procedures, such as knee and hip replacements.

The new strategy works like this:
Your health insurance plan slaps a hard limit on what it will pay for certain procedures, for example, hospital charges associated with knee and hip replacement operations. That's called the reference price.

Say the limit is $30,000. The plan offers you a choice of hospitals within its provider network. If you pick one that charges $40,000, you would owe $10,000 to the hospital plus your regular cost-sharing for the $30,000 that your plan covers.

The extra $10,000 is treated like an out-of-network expense, and it doesn't count toward your plan's annual limit on out-of-pocket costs.

That's crucial because under the health care law, most plans have to pick up the entire cost of care after a patient hits the annual out-of-pocket limit, currently $6,350 for single coverage and $12,700 for a family plan. Before the May 2 administration ruling, it was unclear whether reference pricing violated this key financial protection for consumers.

"The problem ... from the patient's perspective is that at the end of the day, that is who gets left holding the bag," said Karen Pollitz of the nonpartisan Kaiser Family Foundation. Previously she was a top consumer protection regulator in the Obama administration.

 

[sameech]

This is a very problematic ruling. If this is truly how it is going to work, then hospitals and surgeons should be required to give you a good faith estimate as to the cost.

I know it is getting bad for seniors too. I used to think that outpatient services/one day surgeries were great because of the advancement in technologies and convenience, but I have since learned that with seniors, it often is so they can throw them into the 80/20 copay instead of the medicare A flat copay system. Some minor procedure can seriously disrupt their finances when it ends up costing them 2 or 3 times what the surgery copay would have been.

Either way, I really do not see how quality of care cannot suffer greatly under these financial pressures despite the "you get paid less if they are readmitted" rules.

 

[Greenbeard]

When CalPERS experimented with reference pricing, they produced some pretty impressive results, dropping hospital prices by more than a third (not reimbursements, prices charged by hospitals).

Calif. hospital prices drop as CalPERS caps coverage for new knees, hips

Joint replacement prices at the most costly California hospitals plunged by one-third after the state required its workers and retirees to pay out of pocket all costs above a “reference price” of $30,000 for orthopedic surgery, a new study said.

The average cost of joint replacement among high-priced hospitals dropped to $28,465 after the California Public Employees' Retirement System made the change in 2011, wrote University of California researchers James Robinson and Timothy Brown in the journal Health Affairs. That's down from $43,308 the prior year.

After taking into account other factors that affect price, the average hospital price for joint replacement dropped by one-fifth in response to CalPERS' policy, known as reference pricing. The switch saved an estimated $3.1 million for 447 patients, the researchers estimated.

Hospitals, which in recent years have gained leverage to raise prices through consolidation, seemed to react by dropping their prices as consumers were given a powerful financial incentive to comparison shop, said Robinson, a health economics professor and director of the University of California Berkeley Center for Health Technology.

If done right, it can be a very effective way to inject market forces into the health sector.

 

[HelenaHandbag]

They will control costs by raising deductibles and denying coverage.

That and death panels.

 

[USNavyVet]

Many laughed when death panels were mentioned and here we are with death panels.