Aug 28, 2017 | Laboratory Management and Operations, Laboratory News, Laboratory Operations, Laboratory Pathology, Laboratory Testing, Managed Care Contracts & Payer Reimbursement, Management & Operations
Two different deals aim to bring a new style of healthcare insurance to individuals and small businesses
Designed to be a new model for health insurance, the much-watched Oscar Health (Oscar), founded in 2012, has just inked deals with both the Cleveland Clinic and Humana, Inc. What makes Oscar worth watching by pathologists and clinical laboratory managers is that the innovative insurer was founded and is run by Gen X and Gen Y (Millennial) executives.
Oscar Health is billed by its Millennial cofounders as a new type of health insurance—one that “curates” or coordinates members’ care with the help of health information technology (HIT) on the Internet, a smartphone app, and personalized services by concierge teams. So, it is interesting for pathologists and medical laboratory leaders to note that New York-based Oscar is partnering, through two different deals, with well-established Cleveland Clinic and rival Humana to enter the Ohio and Tennessee healthcare markets.
As Dark Daily reported in a previous e-briefing, Oscar aims to leverage sophisticated technology solutions and data to challenge complexity and costs associated with traditional healthcare insurance. An approach no doubt driven by the modern thinking of the company’s young founders. We alerted lab leaders that the insurance startup could be the latest example of technology’s power in the hands of Gen Y and Gen X entrepreneurs.
And while Oscar has reportedly experienced financial challenges, it is moving forward with the widely publicized new partnerships, as well as additional plans to expand insurance coverage in more states. Therefore, it’s important for clinical laboratory professionals to follow Oscar, which soon could be a healthcare payer of clinical laboratory and anatomic pathology services in more regions of the country.
Why Is Oscar Teaming Up with Cleveland Clinic, Humana?
In short, Cleveland Clinic is making its debut into the health insurance market with Oscar. And Oscar is moving into Ohio on the coat tails of this nationally prominent healthcare provider. The co-branded Cleveland Clinic/Oscar Health insurance plan will be offered to northeast Ohio residents in the fall for coverage effective Jan. 1, according to a Cleveland Clinic news release.
“This is a rare opportunity to work with the Cleveland Clinic to deliver the simpler, better, and affordable healthcare experience that consumers want,” said Mario Schlosser, Oscar’s Chief Executive Officer and cofounder in the news release.
Josh Kushner (left) and Mario Schlosser (right) cofounded Oscar Health, a New York-based health insurer that employs computer technologies, a mobile app, and concierge-style healthcare teams to provide members with a modern health plan experience and easy access to quality healthcare providers. (Photo copyright: Los Angeles Times.)
The coverage will be sold on and off the Ohio Affordable Care Act state exchange. Here’s what consumers will receive, noted statements by the Cleveland Clinic and Oscar Health:
- Access to primary care providers affiliated with the Cleveland Clinic, and an Oscar Health concierge team (a nurse and three care guides) that can refer patients based on their needs to other providers in the care continuum;
- Virtual care visits enabled by Cleveland Clinic Express Care Online and Oscar’s Virtual Visits;
- Smartphone technology to make it possible for members to explore their health needs, find options, and review costs.
“We are looking to build a new relationship among payers, providers, and patients. This relationship goes beyond the traditional approach of getting sick and seeing the doctor,” noted Brian Donley, MD, Cleveland Clinic’s Chief of Staff.
In an article on the partnership, Forbes suggested that narrow healthcare networks like the Cleveland Clinic/Oscar model might be just what the ACA exchanges need to remain operational.
However, a Business Insider article suggests that Oscar—already active in New York, Texas, and California health exchanges—could be adversely affected by a successful replacement of the ACA, currently being debated by Congressional lawmakers.
Nevertheless, Alan Warren, PhD, Oscar’s Chief Technology Officer, told Business Insider that the Cleveland Clinic/Oscar Health insurance plan would go forward even if Obamacare did not.
Formal Rival Humana Now Oscar’s Partner in Small Business Insurance
Meanwhile, the partnership with Humana takes Oscar, which launched Oscar for Business in April, 2017, further into the small business health insurance market. Humana and Oscar will sell commercial health insurance to small businesses in a nine-county Nashville, Tenn., area effective in the fall, according to a joint Oscar/Humana news release.
“The individual market was a good starting point. But it was clear from the beginning that the majority of insurance in the US is delivered through employers,” Schlosser stated in a New York Times article.
As to who does what, Beth Bierbower, Humana’s Group and Specialty Segment President, explained in an article in the Tennessean that Humana will contract with hospitals and doctors for small business insurance, while Oscar’s technology solutions will help small businesses and their employees manage healthcare benefits and gain access to providers. “These people [at Oscar] are on to something,” she noted. “They are doing something a little different. Maybe this is a situation where one plus one, together, might equal three.”
Future Growth Planned by Oscar
The New York Times called Nashville “a new step for Oscar,” and noted that it follows Oscar’s recent loss of $25.8 million during the first three months of 2017—47% less than Oscar lost during the same period in 2016. Since its inception, however, Oscar has raised $350 million in investment capital, much of it from Silicon Valley investors.
Also, Oscar’s small-business health insurance plans, which started in the spring in New York, might launch in New Jersey and California as well, an Oscar spokesperson stated in a Modern Healthcare article that also reported on Oscar’s intent to increase individual plans sold in the ACA Marketplace from three states to six in 2018.
Clinical Laboratories Benefit from Increased Consumer Access to Health Providers
Could Oscar succeed with its new Cleveland Clinic and Humana partners? Possibly. Both deals are pending regulatory approval as of this writing.
In any case, the whole idea of making insurance more palatable for consumers is something clinical laboratories, which are gateways to healthcare, should applaud and support. It is good to know that insurers like Oscar are using technology and personal outreach to ease consumers’ access to providers and help them explore options and costs.
—Donna Marie Pocius
Related Information:
Cleveland Clinic, Oscar Health to Offer Individual Health Insurance Plans in Northeast Ohio
Introducing Cleveland Clinic Oscar Health Plans
Oscar Health Partners with Cleveland Clinic on Obamacare Exchange
Oscar Health Partners with Cleveland Clinic
Oscar Health to Join Human in Small-Business Venture
Humana Oscar Health Pilot Small Business Insurance Partnership in Nashville
Oscar and Humana Team up to Sell Small-Business Plans
Insurance Start-Up Oscar Seeks to Shake Up Healthcare Through Its App
Gen Y Entrepreneurs Launch Oscar, A Consumer-Friendly Health Insurance Company in Bid to Disrupt Traditional Health Insurers
Jul 3, 2017 | Laboratory Operations, Laboratory Pathology, Laboratory Testing, Managed Care Contracts & Payer Reimbursement, Management & Operations
OIG suggests better use of analytics by CMS could prevent gaming of the system by providers; clinical laboratories can help through test utilization management technology
It may come as a surprise to many hospital-based pathologists and clinical laboratory managers that the Centers for Medicare and Medicaid Services (CMS) has reason to suspect that some hospitals are “gaming” the system in how they report hospital-acquired infections (HAIs).
In 2015, CMS implemented the Hospital-Acquired Condition Reduction Program (HACRP) as part of the Patient Protection and Affordable Care Act (ACA). The HACRP program incentivizes hospitals to lower their HAI rates by adjusting reimbursements according to the inpatient quality reporting (hospital IQR) data provided by the healthcare providers. Hospital IQR data is the basis on which CMS validates a hospital’s HAI rate (among other things CMS is tracking) to determine the hospital’s reimbursement rate for that year.
However, an April 2017 report by the Office of the Inspector General US Department of Health and Human Services (OIG) noted that CMS was not doing enough to identify and target hospitals with abnormal reporting of HAIs.
The OIG reported:
- CMS, in 2016, met its regulatory requirement to validate inpatient quality reporting data;
- It reviewed data of 400 randomly selected hospitals as well as 49 hospitals targeted for failing to report half their HAIs, or for low scores in the prior year’s validation process;
However, OIG also reported that CMS did not include hospitals that displayed abnormal data patterns in its targeted sample. Targeting those hospitals, according to the OIG, could identify inaccurate reporting.
CMS staff had identified 96 hospitals with aberrant data patterns, but did not target them for validation—even though the agency can select up to 200 targeted hospitals for review, Becker’s Hospital Review pointed out.
Dollars More Important than Deaths
According to the OIG report, Medicare excluded in its investigation dozens of hospitals with suspected HAI reporting. This is odd since the CMS and the Centers for Disease Control (CDC) apparently are aware that some healthcare providers have manipulated data to improve their quality measure scores and thus increase their reimbursement rates.
“Collecting and analyzing quality data is increasingly central to Medicare programs that link payments to quality and value. Therefore, it is important for CMS to ensure that hospitals are not gaming [manipulating data to improve scores] their reporting of quality data,” the OIG report noted.
“There are greater requirements for what a company says about a washing machine’s performance than there is for a hospital on quality of care. And this needs to change,” stated Peter Pronovost, MD, PhD, in the Kaiser Health News article. “We require auditing of financial data, but we don’t require auditing of healthcare quality data, and that implies that dollars are more important than deaths.” Pronovost is Senior Vice President for Patient Safety and Quality at Johns Hopkins University School of Medicine.
Peter Pronovost, MD, PhD (above) testifying on preventable deaths before the Senate Subcommittee on Primary Health and Aging in 2014. He is Senior Vice President for Patient Safety and Quality at Johns Hopkins University School of Medicine in Baltimore. Pronovost told Kaiser Health News that there are no uniform standards for reviewing data that hospitals report to Medicare. (Photo copyright: US Senate Committee on Health, Education, Labor and Pensions.)
Medicare Missed Hospitals with Suspected HAI Data
CMS should have done an in-depth review of many hospitals that submitted “aberrant data patterns” in 2013 and 2014, the OIG stated in its report. According to a Kaiser Health News article, such patterns could include:
- A rapid change in results;
- Improbably low infection rates; and
- Assertions that infections nearly always struck before patients arrived at the hospital.
“There’s a certain amount of blind faith that hospitals are going to tell the truth. It’s a bit much to expect that if they had a bad record they are going to fess up to it,” noted Lisa McGiffert, Director of the Safe Patient Project at Consumers Union, in the Kaiser Health News article.
CMS Needs Better Data Analytics
So, what does the OIG advise CMS to do? The agency called for “better use of analytics to ensure the integrity of hospital-reported quality data.” Specifically, OIG suggested CMS:
- Identify hospitals with abnormal percentages of patients who had infections on admission;
- Apply risk scores to identify hospitals with high propensity to manipulate reporting;
- Use experiences to create and improve models that identify hospitals most likely to game their reporting.
CMS’ Administrator Seema Verma reportedly responded, “We will continue to evaluate the use of better analytics as feasible, based on Medicare’s operational capabilities.”
Medical Laboratory Diagnostic Testing Part of Gaming the System
A 2015 CMS/CDC joint statement noted “three ways that hospitals may be deviating from CDC’s definitions for reportable HAIs,” and two involve diagnostic test ordering. According to the OIG report, they include:
- Overculturing: Diagnostic tests may be overutilized by providers in absence of clinical symptoms. Hospitals may use positive results to game their data by claiming infections that appeared days later were present on admission and thus not reportable.
- Underculturing: Hospitals underculture when they do not order diagnostic tests in the presence of clinical symptoms. By not ordering the test, the hospital does not learn whether the patient truly has an infection and, therefore, the hospital does not have to report it.
- Adjudication: Hospital administrative staff may inappropriately overrule those who report infections. HAIs are, therefore, not shared.
Clinical Laboratories Can Help
One in 25 people each day receives an HAI, CDC estimates. The OIG findings should be a reminder to medical laboratories and pathology groups that quality measures and patient outcomes are often transparent to media, patients, and the public.
One way medical laboratories in hospitals and health systems can help is by investing in utilization management technology and protocols that ensure appropriate lab test utilization. Informing doctors on the availability of appropriate diagnostic tests based on patients’ existing conditions, unique physiologies, or medical histories, could help prevent hospitals from inadvertently or deliberately game the system.
Clearly, transparency in healthcare is increasing. That means there will be more news stories revealing federal agencies’ failures to respond to healthcare data in ways that could have protected patients and the public. Clinical laboratories don’t want to be included in negative reporting.
—Donna Marie Pocius
Related Content:
CMS Validated Hospital Inpatient Quality Reporting Program Data, But Should Use Additional Tools to Identify Gaming
Medicare Failed to Investigate Suspicious Infection Cases from 96 Hospitals
CMS Can Do More to Validate Hospital-Reported Infection Data, OIG Report Finds
Study Suggests Medical Errors Now Third Leading Cause of Death in the US
Research Study at Johns Hopkins University Reveals CDC Does Not Record Medical Errors in Annual Mortality Report, Yet Such Errors Are Third Leading Cause of Death
Biggest Opportunity for Clinical Laboratory Industry is Utilization Management of Lab Tests, But Only If It Is Done Well
Lessons from the Pioneers: Reporting Healthcare-Associated Infections
Webinar: Simple, Swift Approaches to Lab Test Utilization Management: Proven Ways for Your Clinical Laboratory to Use Data and Collaborations to Add Value
May 19, 2017 | Compliance, Legal, and Malpractice, Laboratory Operations, Laboratory Pathology, Managed Care Contracts & Payer Reimbursement
Clinical laboratories must stay informed about the success of bundled-payment initiatives because they will need to negotiate a share of these payments where medical laboratory testing is involved
Research published this year concluded that bundled payments for joint replacement services performed on Medicare patients reduce Medicare’s costs without negatively affecting patient outcomes. Because these types of surgeries do not generally utilize many lab tests, the question is still out as to whether bundled payments allow clinical laboratories to be adequately reimbursed for their services.
The study of the bundled payment program was published in the Journal of the American Medical Association (JAMA). The researchers sought to determine the cause of the reduction in Medicare payments and hospital savings when bundled payment models for joint replacement surgeries were used.
The research was performed by staff at the Perelman School of Medicine at the University of Pennsylvania (UPenn). They examined hospital costs and Medicare claims for patients requiring hip and knee replacements at the 5-hospital Baptist Health System (BHS) in San Antonio. (more…)
May 10, 2017 | Laboratory News, Laboratory Operations, Laboratory Pathology, Laboratory Testing, Managed Care Contracts & Payer Reimbursement
Medical laboratories are in key position to advise and guide other healthcare organizations to implementing strategies and technologies that support consumerism in healthcare
Dark Daily has regularly alerted our readers to the fact that employers and healthcare policymakers are seeking ways for consumers to take more active roles in their healthcare. That includes requiring more out-of-pocket payments from patients to control prices, and quality metrics, so patients can select hospitals, doctors, and clinical laboratories based on price and performance.
Capitalizing on such consumerism in healthcare is not only an area where pathology groups and medical laboratories can play a key role, but also a trend where they hold a commanding lead over many healthcare organizations.
Because appointment setting and the ability to review test results has long been in demand by consumers of clinical laboratory services, many blood labs have already implemented easy-to-understand but highly functional patient portals,. Two examples that have attracted national attention are Kaiser Permanente’s “My Health Manager” and Quest Diagnostics’ (NYSE:DGX)” patient portal. (more…)
Apr 10, 2017 | Compliance, Legal, and Malpractice, Laboratory Management and Operations, Laboratory News, Laboratory Pathology, Laboratory Testing, Managed Care Contracts & Payer Reimbursement, Management & Operations
Aetna’s CEO Mark Bertolini highlights how the current system increases costs for both insurers and consumers
At the moment, probably no issue is more politicized than that of the Affordable Care Act (ACA), often called Obamacare. Because it controls the design of health insurance coverage, it also influences the way health plans pay hospitals, physicians, clinical laboratories, and anatomic pathology groups.
However, understanding the truth about what is working and what is not with the Affordable Care Act is a complex undertaking. That is because both the advocates and critics of this law are engaged in highly-partisan rhetoric, despite the fact that most have no intimate knowledge of how healthcare works in the United States. (more…)
Mar 3, 2017 | Compliance, Legal, and Malpractice, Laboratory News, Laboratory Pathology, Managed Care Contracts & Payer Reimbursement
Medical laboratory and pathology groups could benefit from trend by receiving payments for testing services from secondary payer rather than directly from patient
As high-deductible health plans (HDHPs) become the norm for more Americans, gap insurance is being touted as an innovative way to protect consumers from crippling healthcare costs. This added insurance protection is proving attractive to a growing number of patients with HDHPs.
Use of gap plans by more patients also could benefit clinical laboratories and pathology groups. That’s because patients with HDHPs who would normally be required to pay 100% of their lab testing charges until their annual deductible is met, would be covered for these costs because of their gap insurance. In these situations, labs would have a secondary insurer to bill until the annual deductible was met. (more…)
