Thursday, June 18, 2009

Moving Closer To Acceptable Public Health Plan
Senator Kent Conrad (D-ND) Introduces a "potential compromise" to the public health plan. Following is an interview with Ezra Klein of the Washington Post.

(Earlier today, Sen. Kent Conrad, the North Dakota Democrat who chairs the Senate Budget Committee, introduced a "potential compromise" on the public plan: A system of federally-chartered co-ops that could offer a non-profit alternative to the for-profit insurance industry. In this telling, the co-ops preserve the central feature of the public plan -- they're a competitor to the traditional insurance industry -- but are free from the baggage of government control.

I spoke to the Senator this evening about the co-op model, and he said a few things that surprised me. First, his search for an alternative was on behalf of the G-11 -- the key Senate powerbrokers on health care. Second, it proceeded from the premise that the public plan doesn't have the votes. All Republicans are opposed and, according to Conrad, "at least three Democrats." And third, he thinks reconciliation is basically out as a viable option for comprehensive health reform. A lightly edited transcript follows.)

Tell me a bit about your idea for chartering co-ops in the health insurance market.

Maybe it would be most useful to tell you how I got into this. The G-11 group, which is the members of the Senate, Republicans and Democrats, chairmen and ranking members of the key committees, who've been given the overall responsibility to coordinate health care reform in the Senate, asked me 10 days ago to come up with something to bridge the divide between those who are strong adherents to the public plan and those who are strongly opposed.

The co-op structure came to mind because it seems to fulfill at least some of the desires of both sides. In terms of those who want a public option because they hope to have a competitive delivery model able to take on the private insurance companies, a co-op model has attraction.

And for those against a public option because they fear government control, the co-op structure has some appeal because its not government control. It's membership control, and membership ownership.

Also the co-op model has proven very effective across many different models. Ocean Spray in the cranberry business, and Land of Lakes in the dairy business, and Puget Sound in the health care business.

How do you respond to someone who says, this is a terrific idea. More competition is always welcome. But why instead of a public option? Why not do it alongside and let a thousand coverage models bloom?

Votes. The problem is this. If you're in a 60 vote environment in the Senate -- and I believe we are, because I believe reconciliation simply won't work -- if you begin tallying up the votes, I believe that virtually all Republicans are against the public option and some democrats are. So how do you get to 60?

How many Democrats would you estimate are against a public option?

I don't know for certain, but I think at least three, and maybe more.

And why do you think that reconciliation won't work for health reform.

Reconciliation was never designed to write substantive legislation. It was designed solely for deficit reduction. The whole idea was you would change numbers, not policy. You would change numbers on the revenue side of the equation and the spending side of the equation.

And so, the way it works, under current rules, if you're in reconciliation, you have to be deficit neutral over five years. Under the budget resolution, health care can be deficit neutral under 10 years. That's a big difference.

Two, under reconciliation, you're subjected to the Byrd rule. The Byrd rule says that anything that doesn't cost money or save money, or that only costs money or saves money in a way that's incidental to the policy, is subject to strike. The result, for instance, is that all the insurance market provisions are subject to strike. All the wellness and prevention provisions are subject to strike. The Senate parliamentarian said to us that if you try to write substantive health reform in reconciliation, you'll end up with Swiss cheese.

Then let's go back to why this works as a compromise. I understand why it would be preferable for Republicans. But for supporters of a public plan, the key advantage is that the public plan is big. It can negotiate discounts with providers. In the form Sen. Rockefeller offered, it can even use Medicare payment rates. These co-ops don't seem like they'd have that size or weight. How would they compete with large private insurers?

They might have that weight. One option is for a national cooperative. That would give it the heft and weight to compete. But you know, one of the interesting things when we talk to experts is that they say critical mass is probably around 500,000 members. Puget Sound is probably around 580,000 and they compete successfully against much larger entities. The experts tell us that there are probably advantages of size up to a point, but after that point, the law of diminishing returns sets in.

Who would charter these? What is the process? Do I go over to my local health insurance exchange and put in an application?

The way co-ops typically are formed, people who feel they're not appropriately served, or not served at all, band together. They form an organization, elect a board, hire people to do the work, pool their money, and the organization goes forward.

These cooperative entities would provide their contracts through the exchange just like everyone else, be subject to the same rules as everyone else, in terms of reserve requirements, in terms of what kind of contracts they could offer. People would go to their exchange, they'd see the option, and if they liked it, they'd sign up, and then they become one of the members, because every member is an owner. And they would have elections and that elected board would choose the leadership.

Would there be regulations on how many of these there would have to be in each state?

We've not contemplated having that in the health care reform law, but there is clearly an economic requirement in order to have the leverage to negotiate with providers to get competitive rates, you need greater bulk. That's where we believe we need 500,000 lives to be competitive.

That's probably one of the two major items of discussion still remaining here. They're various options for consideration if you will. I offered the G-11 group three models. One is state-based, so every state has one. I don't think that works frankly. In states like mine, the pool wouldn't be big enough. The second would be a national entity. That's probably too limiting as well.

What you probably need is a national entity with state affiliates, and the further flexibility so those states can have regional pools. So in our part of the country, you might have North Dakota, South Dakota, Montana, and Wyoming go together. Out east you might have Maine, Vermont, and New Hampshire together. We're consulting with experts tomorrow about that.

Where did this idea come from? I've done a fair amount of health care reporting, and this is the first I've heard of it.

I guess it came out of conversations in my office after we were asked to see if we couldn't come up with some way of bridging this chasm. Part of it is that we're so used to cooperative structures in my state. They were begun by progressives, they came out of the progressive era. And they're so successful in our state. So I can't really say we came up with some brand new idea. We just thought about our own experience.

What has been the reaction of some of your more liberal colleagues to this?

I think it's fair to say mixed. Those who really want public option because they really want single payer, this does not satisfy their position. Others who really want a competitive insurance model kind of like it. Others who are looking at how you put together the votes are intrigued by it. And on the Republican side, a grudging acceptance that this may be one way to increase competition that does not increase government control.

Let me ask you one last question on that. I understand why this proposal wouldn't satisfy liberals who want single-payer. But why does it arouse Republican opposition? It seems, in a way, to be very small-r republican.

Because they don't...ah, you know, you'd have to ask them. It would just be my surmise on why some of them don't like it. They really don't want a competitive model, at least some of them.

Blue Cross Of Georgia Hit With Class Action Suit
Story from Atlanta Business Chronicle

Blue Cross Blue Shield of Georgia has been slapped with lawsuit seeking class action by Georgia surgery centers that could cost the state’s largest health insurer tens of millions of dollars.

The suit alleges Blue Cross Georgia has discouraged visits to out-of-network providers by reimbursing procedures at a tiny fraction of “usual and customary” charges.

Blue Cross Georgia spokeswoman Cheryl Monkhouse dismissed the allegations as being without merit and said the insurer plans to “defend the suit vigorously.”

Blue Cross Georgia “is committed to providing appropriate reimbursement for out-of-network services, while at the same time protecting its members and group customers against excessive charges by some non-participating providers,“ Monkhouse said.

The suit is similar to one filed earlier this year by a dialysis provider against Blue Cross. That suit was dismissed.

The new suit, filed against Blue Cross Blue Shield Healthcare Plan of Georgia Inc. and Blue Cross and Blue Shield of Georgia, alleges Blue Cross members paid higher premiums in exchange for the flexibility to receive coverage for care from providers who are not part of the plan’s preferred network.

Blue Cross Georgia has targeted these out-of-network providers, including ambulatory surgery centers, “for a drastic and unprecedented slash in reimbursement to a mere fraction of usual and customary charges,” the suit claims. These actions violate federal and state laws protecting patients and providers, as well as Blue Cross Blue Shield’s contracts, the suit claims.

Blue Cross has cut its reimbursement to out-of-network surgery centers by about 80 percent, said Leigh Martin May, attorney with the plaintiff’s firm, Butler, Wooten & Fryhofer LLP.

Blue Cross “has slashed reimbursement rates to non-member surgery centers making it impossible for their insureds to receive the benefits they are paying for,” May said. “[The insurer] is charging for a service it has effectively eliminated. BCBS should honor the contracts they have made with their insureds.”

Plaintiffs are seeking monetary damages -- which, May said, could run into the “eight figures” -- for Blue Cross Georgia’s alleged failure to pay the contracted reimbursement rate and they are asking the court to force Blue Cross Georgia to honor its agreements.

Earlier this year, Nashville, Tenn.-based National Renal Alliance filed a lawsuit against Blue Cross Georgia, claiming the insurer slashed reimbursement rates for out-of-network dialysis services by 88 percent.

National Renal Alliance was acquired by Renal Advantage Inc. last year.

In March, a federal court judge in Atlanta dismissed the suit, saying Blue Cross’ decision to amend its reimbursement rates for dialysis performed at out-of-network facilities like the Alliance’s did not violate the act’s provisions that prohibit insurers from discriminating against individuals with end-stage renal disease.
License not renewed for York Springs nursing home
State inspectors said they found 33 violations -- many of which were repeats -- at Whispering Pines.

For the Daily Record/Sunday News

The Pennsylvania Department of Public Welfare has not renewed the license for an Adams County nursing home for alleged violations that include rodent feces, expired medications and not evacuating all residents during a fire drill.

A parent company, Talex Inc., owns Whispering Pines in York Springs. The department's inspection report listed Julia Harris, a York Springs borough council member, as president.

Harris would not identify other stockholders in the company.

In 2005, the state listed her husband, Phillip B. Harris -- a former borough auditor -- as affiliated with Talex when it alleged that the nursing home failed to have workers compensation insurance. In 2006, he pleaded guilty to five misdemeanors in Adams County Court of Common Pleas and was sentenced to 60 months in the intermediate punishment program.

DPW spokeswoman Stacey Witalec said that, during a March inspection, state inspectors found 33 violations, 12 of which were repeat violations from 2008, at the facility in the 400 block of Main Street.

"It goes on and on," Witalec said about the list of violations.

She said Whispering Pines was already operating under a provisional license, a probationary status that results in more inspections and closer examination.

Julia Harris said Thursday the company has made several changes in upper management at the facility and that numerous policy and procedure changes have been put in place.

An administrator handles the day-to-day business of the nursing home, she said.

"Unfortunately Whispering Pines had numerous violations in their most recent inspection," Harris wrote in an e-mail. "I have been assured that all cited violations have been corrected."

One of the more-serious violations dealt with fire drills, Witalec said. In two separate drills, a resident was left behind, inspectors reported.

"It is absolutely critical to go through a fire drill and know how to evacuate everyone in a timely manner," Witalec said.

Julia Harris, however, said the report does not accurately reflect what happened.

"A specific resident of the facility refused to participate and evacuate the building," she said.

Harris said Whispering Pines documented the resident's refusal, as it was advised to do by the state. Still, the state cited the facility again when a resident refused to leave.

"Whispering Pines is a very good home," Harris said. "But, as usual, DPW makes up new rules, and each inspector looks at them differently."


Violations at Whispering Pines nursing home, according to the state Department of Public Welfare's report:

--- On several occasions in February, a lone staff member on the overnight shift was not certified in first aid. At least one staff member for every 50 residents must be trained in first aid, according to the report. This was a repeat violation.

--- A large amount of rodent feces was found on the floor and on the shelves in the home's pantry.

--- The fire-alarm system had malfunctioned and displayed five trouble codes, and two fire extinguishers were not charged.

--- Several medication violations were found, including insulin that was not refrigerated, expired medication, unaccounted-for pills and improper documentation.


The owners of Whispering Pines have filed an appeal and can operate the facility through the appeal process. However, the Department of Public Welfare has prohibited the facility from taking in new residents during the process.

The first step is a hearing June 23 with the department's Bureau of Hearings and Appeals.

After the appeal, either party -- Whispering Pines or the department -- may ask for reconsideration of the decision from the department secretary. From there, either side can appeal to Commonwealth Court.


For inspection violation reports and licensing status of Pennsylvania care homes, visit and click on "Personal Care Homes Directory."
New Discoveries: Age-Related Macular Degeneration
Story from McKnight's

Researchers at the University of Kentucky have announced a major breakthrough in the prevention and early detection of neovascular age-related macular degeneration (AMD). The condition affects between 10 million and 12 million Americans and is the number-one cause of blindness among seniors.

At the annual meeting of the American Medical Association on Monday, researchers identified a biological marker, known as CCR3, that they say is integral to the development and progression of eye disease. AMD is caused when new, abnormal blood cells invade the retina and interfere with the eye's ability to receive oxygen and nutrients in a process called choroidal novascularization (CNV).

The CCR3 marker, which also plays a role in the inflammation process, was found on the CNV vessels, but not on normal vascular tissue, according to the report. By injecting anti-CCR3 antibodies into mice, researchers were able to see the CCR3 markers on the CNV vessels before the new abnormal blood cells invaded the retinas, causing irreversible damage. Early therapy test results appeared promising, with 70% reductions in CNV among the test mice, according to the report.

The findings were published Sunday in the online version of the journal Nature and will appear in an upcoming print issue.
Nursing Home Planned For Medical Campus Not Without Controversy
Story from the Buffalo News

Kaleida Health is preparing to build a 300-bed nursing home, another big project connected to the Buffalo Niagara Medical Campus that advocates say will significantly improve services for the elderly in the inner city.

The $64 million building, planned for the block bounded by Michigan Avenue and Maple, East North and High streets, will be the first nursing home built in Buffalo in many decades.

It will rank as one of the largest nursing homes in the region and will fill a gap in long-term-care services resulting from the disappearance in recent years of Grace Manor, Nazareth and other facilities in the city.

James Kaskie, president and chief executive officer of Kaleida Health, said the project will benefit the Fruit Belt neighborhood, the hospital system and the medical campus.

“When you step back and think about the investments that are being made, if you understand facilities, what we’re planning is so much more efficient and improved for medicine than what we have now,” he said.

The project will replace two nursing homes operated by Kaleida Health — the 242-bed Deaconess Center on Humboldt Parkway and a 75-bed skilled-nursing unit in Millard Fillmore Hospital at Gates Circle.

The Deaconess buildings date from 1920, and the portions used for nursing home care were constructed in 1959 as a hospital. The facility is antiquated, with obsolete building systems and floor plans.

A state commission ordered Millard Fillmore Hospital closed as part of an effort to reform the region’s inefficient hospital industry. Plans call for moving its hospital services to Buffalo General Hospital and to an adjacent center for heart and vascular care on which construction is expected to start this summer.

As proposed by Canon Design, the nursing home would consist of four connected structures with 20-bed clusters of semi-private rooms and courtyards on each floor. Its four stories are intended to provide a visual transition between the taller hospital buildings on one side and the residential neighborhood on the other side.

It will consist of 200 long-term- care beds, 40 beds for patients with memory impairment, 30 beds for short-term patients rehabilitating from hospital care, 20 beds for children with profound disabilities and 10 beds for residents on ventilators.

Dr. Bruce Naughton described the home as a significant improvement, offering residents green space, smaller groupings of rooms and greater privacy.

“The city needs a quality nursing home. This is where people live. The environment can influence mood and behavior,” said Naughton, chief of the geriatrics division at Kaleida Health and the University at Buffalo.

A new building also should be considered an opportunity to adopt the principles of culture change, he said.

Culture change refers to a growing reform movement that — through staff training, better design and operational changes — is trying to move away from the passionless, poor quality, built-for-efficiency experience that has come to define too many nursing homes.

The construction site in the Fruit Belt neighborhood sits outside the official boundary of the medical campus. The project does not exactly fit the goals in a Fruit Belt Urban Renewal Plan, but advocates say it will redevelop a block that contains 22 vacant lots and an abandoned gas station.

Kaleida Health recently purchased one of the six homes remaining on the block — it paid $180,000 for 316 Maple St. — and officials said they have contracts to buy the others.

Two of the homes, all of which Kaleida plans to demolish, were built in the late 1800s and are eligible for listing on the National Register of Historic Places, although one of them has been altered from its original condition, according to last year’s environmental review of the project.

What criticism the project has received has centered on its design, location and demolition of the historic-eligible homes.

Preservationist Timothy A. Tielman said the design looks too institutional for a neighborhood. He also suggested Main Street as a better location because of its proximity to bus routes and subway stations, as well as nearby businesses.

“I know the block isn’t what it once was. But I look at houses like those and see Queen Anne Victorians or beautiful Italianates that can be restored with some loving care,” said Tielman, executive director of the Campaign for Buffalo History, Architecture and Culture.

A larger concern is with the medical campus and whether designers of the nursing home and other buildings are paying attention to creating a walkable, mixed-use community that includes retail and residences.

The environmental review concluded that the block has lost most of its historic character and that the benefits of the project outweigh the value of attempting to save the homes.

Kaskie said he understood the concerns but defended the design as “pleasant and community- friendly.”

“These people [preservationists] are great stewards of our historic treasures, but the need in this instance trumps that issue,” he said.

Officials at Kaleida Health anticipate construction will start in the fall, after a financing package is completed and final approvals received.

The state Office of Parks, Recreation and Historic Preservation has yet to have a final say. The project also requires rezoning of the Maple Street parcels and city approval to consolidate the parcels into one lot.

Kaleida Health plans to pay for the building with a $12.4 million state grant coupled with debt financing — slated to be part of a larger funding package for medical campus projects — through the sale of bonds insured by the Federal Housing Administration to investors, including banks, private institutions and possibly pension plans.

The future of Deaconess and Millard Fillmore remains unclear, although Kaskie said Kaleida plans to set aside funds to raze Deaconess.

“Deaconess is very old and past the point of rehabilitation. There will have to be a community discussion to talk about reuse of both sites,” he said.