Popular health database requirement cut from bill

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SPOKANE — Lobbying behind closed doors, Washington’s largest health insurance company persuaded Republicans in the state Senate to gut a widely supported bill that aimed to reveal health care price and quality information to consumers.

The battle pits Premera Blue Cross against a broad coalition representing just about everyone who buys, uses, provides or shapes health care: small and large businesses, consumer advocates, tribes, hospitals, doctors, nurses, the governor, the insurance commissioner, the agency that governs insurance for state employees and the poor, and even Premera’s competitors.

That coalition seeks more than sunlight on the industry’s finances; it also backs a comprehensive new statewide plan to change the way the industry operates.

The battle focuses on House Bill 2572, which passed the state House of Representatives and came up for a hearing Thursday in the Senate Health Care Committee. After some fiery testimony, committee Chairwoman Randi Becker, R-Eatonville, stripped the bill’s most controversial section and passed it on to the Ways and Means Committee for further action. She did so without explanation. A lobbyist for Premera stepped to the microphone and thanked her, but said little about the reasons for his gratitude.

The controversy involves the original bill’s provision to create an “all payer claims database.” Loaded with statewide health insurance claims, the database would allow people to compare what health care actually costs and how well it turns out - procedure by procedure, hospital by hospital. It would answer questions like these: What would a knee replacement or childbirth cost, and who does it best?

So far, 14 states have created such databases, and the systems are operational in at least 10.

Rep. Eileen Cody, D-West Seattle and the bill’s sponsor, said, “My goal is to make sure people can see who are the lowest-cost and highest-quality providers.”

Medical costs for common procedures vary in Washington - by as much as 500 percent from one provider to another. So says the Washington Health Alliance, which has operated a claims database containing information only from insurers who submitted information voluntarily. HB 2572 would have made it mandatory for insurers to submit their data.

Big businesses such as Boeing and Alaska Airlines support creation of the database because they hope it would help them identify a path to cost-effective care for their employees. Boeing, for example, rattled Seattle-area hospitals when its health plan began offering to fly cardiac patients to the Cleveland Clinic in Ohio, which has been praised for the cost and quality of its care.

Small businesses support a claims database, as well.

At Thursday’s hearing, the fiercest comments came from Patrick Connor of the National Federation of Independent Business. NFIB fought the Affordable Care Act, Connor noted, and often aligns with Republicans. But on this issue, he told Becker, “It is very, very frustrating . each time we come forward asking for more transparency, more access to information, the concerns of the health insurance carriers about not wanting to participate seem to trump those of the consumers who desperately need more good information to help control health care costs.”

His organization checked with insurance carriers in states that operate claims databases, and the carriers “have no complaints,” Connor said.

Referring to objections Premera has raised in its closed-door lobbying with legislators, Connor said: “Not one of these Chicken Little complaints about price setting, price fixing, about . privacy, have come to pass.”

Contacted by The Spokesman-Review, Premera spokesman Eric Earling explained the company’s point of view: “We support transparency. We’d like to see more of it.” But, he said, price information is not “actionable” for a particular consumer unless it is presented together with information about the consumer’s own coverage details such as deductibles and co-pays.

In addition, it would be “complicated, potentially expensive and time consuming” to create a claims database and comply with its data submission requirements, he said. Meanwhile, he said, his company is busy trying to comply with existing requirements of the federal Affordable Care Act.

Finally, Earling said, the rates Premera has agreed to pay to its networks of health care providers are “proprietary.” If providers such as hospitals could see the full range of reimbursement rates, Earling said, they might use the information to demand higher payments, ultimately driving health care costs up instead of down. So, he said, Premera is working to show the cost of care only to its own customers.

That argument provoked a response from state Sen. Karen Keiser, D-Kent, who has worked for several years to create a state health claims database: “They’re capturing a customer first before they tell them what the costs are. If you can’t get information, then something is very wrong with the market.”

Dorothy Teeter, director of the state Health Care Authority, oversees health insurance for state employees and those on Medicaid. According to Teeter, “we don’t have a competitive marketplace in health care.” When consumers shop for an automobile, they can obtain information about quality and price. But when consumers shop for a knee replacement, “you don’t actually know the price of something or the quality of the outcome.”

“When you blind people to the actual prices, what you are doing is the opposite of a healthy marketplace,” Teeter said. “Then you are hampering a shift of the market . to a sweet spot of price and quality.”

With Teeter at the helm, the state has already won a $3.4 million federal grant to begin creating a claims database. Without the provisions Becker stripped from HB 2572, the database could proceed but it would only contain information from insurance carriers that choose to participate. That, Teeter said, would provide an incomplete and potentially inaccurate picture of the health care market.

The battle over the database, however, is only one item in a much larger reform agenda aimed directly at health care’s high cost.

The agenda is described in a 278-page state Health Care Innovation Plan that emerged in December and was funded by a $1 million federal grant. Nineteen states created plans like this one, and now these states, including Washington, are seeking federal implementation grants that could be as large as $50 million per state.

Backers of the plan represent a who’s-who of Washington state: insurers such as Group Health and Molina, hospital systems such as Providence and University of Washington Medicine, big employers such as Boeing, and reformers such as the Bill and Melinda Gates Foundation.

The plan projects $730 million in savings over three to five years. It aims to replace fee-for-service medicine with an “accountable” payment system. Fee-for-service is said by critics to make care more expensive; the more tests and procedures a provider conducts, the more money the provider makes. An “accountable” payment system would create comprehensive networks of care providers and pay by the number of patients covered, with financial rewards for providers who provide lower costs with better health outcomes.

Teeter’s agency, according to the plan, will lead the way. Counting Medicaid clients and state employees, her agency oversees health coverage for 1.7 million people, a fourth of Washington’s population. Today, 90 percent of the health care providers for those residents are paid on a fee-for-service basis. By 2019, the plan calls for 80 percent of state-financed health care and 50 percent of the commercial market to switch from fee-for-service to outcomes-based payment.

A claims database, Teeter contends, would shine a light on the current system’s inefficient pricing and create market pressure for change.

Comments

NewInWW 1 year, 6 months ago

"Lobbying behind closed doors, Washington’s largest health insurance company persuaded Republicans in the state Senate to gut a widely supported bill that aimed to reveal health care price and quality information to consumers."

Doesn't that sentence pretty much summarize everything that's wrong with our state and federal governments? This isn't a Republican versus Democrat observation; it's an observation about the systemic - albeit legal - corruption in our governments.

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PearlY 1 year, 6 months ago

"Doesn't that sentence pretty much summarize everything that's wrong with our state and federal governments?"

Not by a very long shot. The sentence that summarized it for me was: "By 2019, the [state's Health Care Innovation] plan calls for 80 percent of state-financed health care and 50 percent of the commercial market to switch from fee-for-service to outcomes-based payment."

Farmers would recognize "outcomes-based" health care as good livestock management. And indeed it is great for sheep. While we may be a shrinking minority, though, some of us humans are not as enamored of being treated like sheep. It's hideously wrong that our government, that is supposed to be our servant, should make a Plan to force 50% of us into a herd management program whether we want that or not.

I recently rushed to get a bunch of health stuff done before Obamacare forced me to kiss goodbye to what remained of my good health insurance plan (after 36 happy years with it). It is quite true that I couldn't look up the cost of my procedures on the internet. But I had no problem calling my doctors' offices and asking for the expected costs and the related codes, then calling my insurance company and finding out what they would pay for those codes and what would be my responsibility based on my remaining deductible and co-insurance amounts.

What struck me was how novel it seemed to both my doctors and my insurance company that anyone would bother to do that. Anyway, the notion that Medicaid patients and government employees, who bear little to no personal responsibility for their own costs, will make choices based on costs, is ridiculous.

This whole exercise isn't about transparency. If transparency were on the agenda, the Health Care Exchange would not be as impenetrably opaque as it is. (I'll bet 95% of the people who have signed up through it have no clue what it will really cost them.) It's about preparing us all for the single-payer aka socialized system that has been the end-goal all along. And THAT's what's wrong with our government.

Although - I'll give you this: The reason that is happening is indeed lobbying and corruption, although the principal actors behind the scene are not Premera, but government-employee and other unions.

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NewInWW 1 year, 6 months ago

^ I'll give other readers the CliffsNotes version: You hate Obamacare, you loved your prior healthcare insurance and you're mad as hell and not going to take it any more.

The "herd" stuff is your usual hysteria and you seem to miss the point that insurers and those evil CMS types might be able to use a combination of the amount charged and outcome achieved to rein in healthcare costs - but that obviously doesn't interest you because you didn't much care about the runaway healthcare costs under the old system (your needs were met), resent any government attempt - including informing the public about costs and outcomes - to effect change, and really don't care that a more efficient healthcare system might be able to serve those who are presently either underserved or un-served.

We get it, it's all about PearlY. Thank God others take a broader view.

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PearlY 1 year, 6 months ago

So you seriously believe the average Medicaid patient is going to extensively "shop" for his/her services based on cost and outcome measures published on the Internet? Or is it going to be government agencies who use that data to tell us what procedures we can and can't have?

Yes, you're right. I don't want that for myself. I also don't want it for my siblings, their children, my neighbors, my friends, and millions of others for whom I think it would be a bad deal. Of course, those are real people, and not abstract pawns to be moved around on an ideological chess board or sheep to be efficiently herded - the "broader view" that you favor.

It happens I have cared about runaway costs for a long time, which is why I opposed each effort by our State's Democratic Insurance Commissioners to expand the mandated inclusions into private health plans of services from everyone whose lobbyists paid off enough Democrats (chiropractors, acupuncturists, etc.) Somehow, Democrats could never make the connection: More mandates = higher costs. So they keep piling them on.

Of course, the likelihood that the government could actually run "a more efficient healthcare system" even if we were all content to be sheep is preposterous in and of itself. Unless by "efficient" you mean successful in monopolizing the power and resources involved, regardless of the care provided to the livestock.

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NewInWW 1 year, 6 months ago

^ Short version follows here: Paragraph 1 - Expresses contempt for (implicitly) lazy Medicaid recipients followed by a PearlY strawman not in any way related to issue at hand.

Paragraph 2 - General hysteria.

Paragraph 3 - Maybe confusion concerning premiums versus overall healthcare costs, maybe sophistry, maybe a chance to foam at the mouth about Democrats.

Paragraph 4 - Hysteria, coupled with a willful decision to ignore Medicare and the VA system (despite some failures), followed by more hysteria.

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PearlY 1 year, 6 months ago

Thanks for the diagnosis. And for free, too! At least one thing you're doing to keep health care costs down.

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downhillracer 1 year, 6 months ago

Not only a broader view, a view that can be conveyed with eloquence, not brute-force novellas with fabricated facts imaginary figures.

To suggest the root cause of the ills of the world should be borne by "government-employee and other unions", and not the corporate world is extraordinarily short-sighted and myopic.

PerlY: No one reads past the first three sentences of your screeds. As FDR once said: "Be sincere, Be brief, Be seated.”

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PearlY 1 year, 6 months ago

And yet, somehow you made it to the last paragraph where I first mentioned unions.

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chicoli 1 year, 6 months ago

Who on earth should trust Premera Blue Cross, supposedly a non profit organization? Back in 2012 the Seattle Times exposed PBC, Regency and Grouphealth about their stockpiling billions while increasing rates at the same time.

Obviously they are not interested in transparency so they can keep medical procedures rates as high as they can. If Cleveland Clinic, e.g. can offer a better deal for episode of heart procedures/ treatment at a fraction of PBC, and with better outcome, this data is not available for local consumption.

As usual these "monopolies" are protected by Republican legislators to the detriment of society as as a whole.

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jkhowell0803 1 year, 6 months ago

Back in 2012 it was a disgrace to learn about the stockpiling that was going on by Premera Blue Cross , Regence Blue Shield and Group Health. During this stockpiling by these insurers, you would think when the request to raise rates was submitted to the WA state insurance commissioner that an investigation would've been started by that office. Instead it took the article of the Seattle Times to put pressure on our state insurance commissioner to do an investigation. If it wasn't for the Seattle Times article, the commissioner probably wouldn't have checked into anything. Now according to your last statement you would almost think our insurance commissioner is republican. However I believe he is a democrat. Shameful that this democrat allowed this stockpiling with outrageous rate increases to be allowed.

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chicoli 1 year, 6 months ago

You "believe" the commissioner is a democrat...or you're sure of it? I never said anything about the commissioner, but now that you stated your "believe" he nevertheless opened the case for investigation...and this in itself is mighty meritorious.

My point is, in the end, that legislation which favors the powerful, to the detriment of "the people" is usually republican, always with the excuse of the "free enterprise" malarkey!

Now we have the ACA which is run by private insurance companies, not by government! But if private insurance companies "bilk" the Government monies/ subsidies by extravagant charges, this is equivalent to screwing you and me out of our tax contributions.

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jkhowell0803 1 year, 6 months ago

I brought up the insurance commissioner because of your comment about the republicans. Mike Kreidler was the insurance commissioner at the time during the stockpiling and in my opinion he should've been doing a better job of protecting us. Yes, I do believe Mr. Kreidler is a democrat. If I am wrong, then I apologize. If I am right, and Mr. Kreidler is a democrat then what "monopolies" do you think this democrat was protecting during the Premera Blue Cross, Regence Blue Shield, stockpiling?

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namvet60 1 year, 6 months ago

jkhowell0803 - you were right:

http://en.wikipedia.org/wiki/Mike_Kreidler

Some people think that anything that doesn't coincide with there political bias they are a Republican. Enough said in this case.

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chicoli 1 year, 6 months ago

The commissioner is not a legislator, therefore not powerful enough to protect "monopolies" or "cartels". He regulates according to laws. As you well know secrecy and scams are buried until they are brought to the surface by, let's say, media exposes such as the Seattle Times one.

If a group of companies conspire to keep the so called "proprietary" ways of managing information and data which should be public domain, for the sole purpose of maximizing their profits, this behavior is typical of monopolies...or cartels, if you which.

Any way, I thank you for your legitimate interest on this matter.You're doing it with intelligent arguments and civil media manners.

Keep it up, please!

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namvet60 1 year, 6 months ago

Let these insurance companies go country wide and into every state instead of putting a lock and key on them. Competition = lower prices!

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