24 July 2012

Midwest Edition
Calendar
August 9
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Clock Is Ticking On Exchanges

Few Midwest States Move Forward With Their Own
The Affordable Care Act mandated exchanges be set up in every state to provide health insurance to residents. The exchanges will be an online marketplace offering standardized plans that meet ACA requirements beginning in January 2014. But the polarizing politics surrounding healthcare reform have bogged down the deployment of the exchanges. Many states have not passed the legislation required to create their own exchanges they held out for the Supreme Court ruling, and now await the results of the presidential and Congressional elections in November, hoping for a potential overturning of the ACA. Only two states in the Midwest has fully moved forward Indiana Gov. Mitch Daniels, a Republican, signed an executive order to create an exchange, while Minnesota recently awarded contracts to build its exchange. States must have exchanges certied by the federal government by January 2013 or the feds will build one of their own. For those that havent made any movement so far, it is likely too late to build a state-based exchange, said Heather Howard, director of the State Health Reform Assistance Network at Princeton University. Many states will likely be operating somewhere in the middle, in a partnership with the federal government. We are going to see a lot of states doing a partnership, because they want to try to retain some control in the state, Howard said. States can take on some of the responsibilities and what we have seen is that states see this as a bridge to a state-based exchange down the road. One state hoping to create a partnership is Kansas, which helped prod the ACA lawsuit that went to the Supreme Court. Running the show is Gov. Sam Brownback, one of the most conservative governors in the country, pitted against a moderate insurance commissioner wanting to move forward. Brownback recently vowed to return almost $32 million to the federal government to create an exchange. At the same time, Sandy Praeger, the Kansas insurance commissioner, has been moving forward in the planning process. Praeger didnt want legislation introduced in 2012 to create an exchange because she noted I didnt want a no vote on the record; I knew we couldnt get it passed during the last session. Praeger concedes now that it is too late for Kansas to have a state-based exchange because it wouldnt have time to complete the infrastructure. What the Sunower State can do, though, is utilize its Medicaid eligibility
Continued on Next Page

September 6-8
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September 9-11

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WEBINAR
E-Mail info@payersandproviders.com with the details of your event, or call (877) 248-2360, ext. 3. It will be published in the Calendar section, space permitting.

Wednesday, August 15, 2012

Noon, CDT

HEALTH BENEFIT EXCHANGES: A PROGRESS REPORT

Please join David Panush, director of government relations, the California Health Benefits Exchange, Anthony Wright, executive director, Health Access, and Jon Gabel, senior fellow, NORC/University of Chicago, to discuss the next major step in the implementation of the Affordable Care Act in California.

http://www.healthwebsummit.com/pp081512.htm
a HealthcareWebSummit Event
co-sponsored by

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NEWS
Exchanges (Continued from Page One)
system that is under currently under construction. The state is spending $135 million to create on online Medicaid enrollment and eligibility system. Praeger said this system will be interoperable with the federal exchange. Similar programs are being created in most states. In some states, progress has stalled while waiting, Howard said. Others are doing administration behind the scenes. Forty-ve out of 50 states are getting funding to enhance Medicaid eligibility systems. When states feel like they can move, they may be further along than we think she said. The ACA mandated ve core functions that must be completed to have an exchange: consumer assistance, plan management, eligibility, enrollment and nancial management. As a partnership state, Praeger said Kansas would be responsible for plan management, which includes selecting a plan and the benet package, oversight of insurers and data collection and analysis for quality. State offcials also be responsible for consumer assistance, which entails regulating the insurance navigators, call center operations and website management. Praeger said there are a handful of reasons states should retain some management of the exchanges. Some businesses and the insurance industry are supportive of the idea, she said, and states currently regulate insurance. Should a federal exchange be created, insurers will have to submit plans both to the state and federal

Page 2

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In Brief
AMA Foundation Makes Grants To Free Clinics
The Chicago-based American Medical Association Foundation has awarded grants to 15 free clinics nationwide to shore up the healthcare safety net and recognize the altruism of volunteer physicians. The grants, which range from $10,000 to $25,000, are earmarked for clinics in 10 states. The Breathing Association Columbus, Ohio, was among the recipients. These free clinics and their grant projects provide a unique and critical pathway to assist the most vulnerable populations, targeting low-income individuals, patients affected by racial and ethnic disparities, or those living in geographic isolation," said Clarence Chou, M.D., the foundations president. We invite individuals and organizations to stand with us and contribute to our efforts, increasing our ability to reach even more free clinics and support innovative and worthy grant projects.

government, a duplication of effort, she said. It would also allow states to provide plans that are more tailored to their consumers needs. An outside rm is currently looking at Kansas data and determining which plans in the state now meet enrollment and benets criteria. We will submit that to the governors ofce and hopefully they will make that determination, Praeger said. If they dont, HHS (the Department of Health and Human Services) will determine the plans for us. Any time we dont do something and HHS does, we lose some control. Creating a partnership would also allow states up to have their own exchange at a later time, Praeger noted. In order to be part of a partnership, a state must provide a letter to the HHS stating its intent by November 16. One interesting nuance in Kansas and a handful of other states is that Praeger is an elected ofcial. Praeger said HHS determined that insurance commissioners who are elected have the ability to sign that letter of intent in lieu of the governor. Though Brownback will likely not write the letter, Praeger said she thinks he will not stop her from doing so. In spite of fact that Governor Brownback has been opposed from the beginning, I think he does see wisdom of keeping Kansas in control as much as possible, she said. TAMMY WORTH

Michigan Restricts MFN Clauses

Insurance Chief Rules on Hospital Contracts
The most favored nation clauses that triggered a bitter legal battle between Aetna and the Michigan Blues will be tightly regulated in the Wolverine State moving forward. Michigan Insurance Commissioner R. Kevin Clinton issued an order last week that mandates health carriers receive prior approval from his ofce for any MFN clauses in contracts with hospitals. Any plans with MFN clauses in force or under negoriation will have a six-month window to get approval for them from Clintons ofce. Any attempts by insurers to obtain MFN status with a hospital without Clintons approval would be banned from doing so. The new regulation takes effect on Feb. 1. The ruling from Clintons ofce arose from a lawsuit Aetna led against Blue Cross Blue Shield of Michigan last year. It accused the Blues of engaging in anti-competitive behavior by using MFN clauses, which essentially
Continued on Next Page

HHS Makes $80 Milion In AIDS/HIV-Related Grants

The Department of Health and Human Services has furnished nearly $80 million in grants to beef up the care of those who are HIVpositive or have AIDS. Of the grants, $69 million money will be sent to the Ryan White AIDS Drug Assistance Program, and is expected to

Continued on Page 3

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Longer ALOS!*

NEWS
Michigan (Continued from Page One)
barred any other carrier from obtaining provider contracts at comparable or more favorable rates. Ofcials with the Michigan Blues struck a tone with equanimity, suggesting that it expected to preserve many of its existing MFN clauses. This action by the state of Michigan is a fair, formal regulatory review of both existing and new contracts to ensure any MFN provisions are proper," said Jeffrey Rumley, BCBSM vice president and general counsel. We will continue to negotiate reimbursement with hospitals that is fair, recognizes hospitals for their

Page 3

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In Brief
eliminate what have been mounting state waiting lists for anti-retorviral drugs. Another $10 million will be distributed to community clinics to provide medical and support services to about 14,000 additional HIV/AIDS patients. The extra money is being provided through the Affordable Care Act. These grants will help make a real difference in the lives of Americans living with HIV/AIDS, especially those in underserved communities, said HHS Secretary Kathleen Sebelius. The entire administration is dedicated to fulfilling President Obamas goal of an AIDS free generation and todays announcement is one more step in that ongoing effort.

efforts to improve quality, and provides our customers with the most affordable pricing possible. However, the Association of Health Plans expected the ruling to create some changes to the states market, saying it will lend more maneuvering room to other payers. These orders will help create a more competitive market for health insurance in Michigan and are a start toward leveling a playing eld that has been tipped toward Blue Cross for many years," said Rick Murdock, executive director of the Michigan Association of Health Plans.

Minnesota Blues Ousts Its New CEO

Lack of Disclosure Cited in Boards Decision
Kenneth Burdick left Coventry Health in January to become chief executive ofcer of Blue Cross and Blue Shield of Minnesota. Six months later, he is out of that job. The Eagan-based health plan announced Burdicks immediate exit late last week, saying that a different style of leadership was needed and strongly suggesting he had clashed with his board of directors. The board became aware of concerns related to whether there had been adequate disclosure of some anticipated business activities and immediately initiated a review and internal investigation of the matter, the Minnesota Blues said in a statement. The internal investigation concluded there had been no nancial impropriety or unlawful actions, but the lack of disclosure was not in alignment with Blue Cross policies and management expectations. Ofcials with the health plan did not provide any specics regarding Burdicks dealings. Scott Lynch, the plans chief legal ofcer, has been named as interim CEO as the search for a new permanent CEO commences anew. Blues ofcials say Burdicks replacement is expected to be named in 60 to 90 days. Burdick had left Coventry as a senior vice president, overseeing its Medicaid and behavioral health businesses, to take the top job with the Blues. Prior to that, he had held a senior position with UnitedHealth. At the time of his appointment, Burdick was praised by Minnesota Blues Board Chairman Vance Opperman as having a broad range of experience at leading companies, and a strong record of growing organizations. His unique combination of expertise, understanding of complex healthcare issues and experience at several large national health care companies make him the right leader for Blue Cross.

University Hospitals Case Wins AHA Quality Award

University Hospitals Case Medical Center in Cleveland is the winner of the American Hospital Association-McKesson Quest for Quality Prize. The award is based on how a hospital moves forward quality in six areas safety, patientcenteredness, effectiveness, timeliness and quality. "It demonstrates for our employees that they have done an outstanding job in building a culture focused on quality and patient safety, said William Annable, M.D., head of the hospitas quality initiatives. To our patients it shows that University Hospitals is in relentless pursuit of breakthrough medicine as well as an extraordinary patient/family experience. Created in 2010, the award is funded by a grant from San Francisco-based McKesson Corp.

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OPINION

Page 4

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The Fight To Preserve Health Reform

The Upcoming Elections Will Be Crucial For ACA
The ght is on again. Mitt Romney, Scott health care. But Republicans want to take that Brown, and Republicans across this country away. are doubling down against President Obamas For small business owners who are healthcare reform law. Now that the Supreme struggling with rising healthcare costs, the Court has said that most of the new law passes federal reforms give tax breaks on insurance constitutional muster, the coverage. But Republicans want to Republicans are running take away that tax break for small for ofce pledging to repeal businesses. every aspect of the healthcare The Affordable Care Act is reforms. already helping families in For millions of people this Massachusetts. Together, these isnt a political issue, its a reforms make families safer. Better personal one. Their health healthcare coverage means more depends on it. people will get preventive care Massachusetts has led the and that means catching serious country in healthcare reform. problems earlier when outcomes Most of us 98 percent are better and treatments are have health care coverage, cheaper. Better healthcare coverage and our state leads the also means that when someone country in tackling head-on the receives a bad diagnosis, the family By ever-growing costs of healthcare. wont be crushed nancially. And Elizabeth helping small businesses pay for That is why President Obama used our law as a model for healthcare Warren healthcare premiums also means that reform. But the national Affordable they can compete against bigger Care Act adds some important businesses on a more level playing eld. elements that improve care even here in But now, Mitt Romney, Scott Brown, and their Massachusetts. fellow Republicans propose to repeal every For seniors, healthcare reform means single one of these provisions. And if they get expanding Medicare coverage to pick up the their way, then what? They dont have any costs of prescription drugs. As the donut hole better proposal. Its just back to square one closes, the average Massachusetts senior has and more battles over healthcare. so far saved about $650. But Mitt Romney, Its time to make the healthcare system Scott Brown, and their fellow Republicans better. We need to reduce costs, not by want to take that away. shifting those expenses to families, but by For young people, reform means staying developing innovation in healthcare delivery on their parents insurance plans until they are and research that will cut costs by improving 26. So far, more than 20,000 young people outcomes. Massachusetts is already at the here in Massachusetts have taken advantage of frontier of these innovations. Our hospitals this. But Romney, Brown, and their fellow receive the most NIH funding to discover new Republicans want to take that away. breakthroughs. Our businesses are at the fore For everyone, healthcare reform means access of designing new medical devices and curing to preventive care like colonoscopies or diseases through biotechnology. And our mammograms without co-pays. Early doctors, administrators, insurers, and others all detection can save both lives and money. In across our healthcare system are working Massachusetts, 780,000 individuals have toward a shared future of better health and received such services. But Republicans want lower costs for everyone. to take that away. For anyone who develops cancer, a Elizabeth Warren is a consumer advocate, chronic illness, or any medical condition that attorney and a U.S. Senate candidate in can cost a staggering amount of money, Massachusetts. healthcare reform means that their insurance company cant set some arbitrary limit on lifetime coverage. Because of that, countless Op-ed submissions of up to 600 words are welcomed. Please e-mail proposals to families will have more secure and stable
editor@payersandproviders.com

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Page 6

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