Things that make me go hmm… Medicare Drumming Up Business For Health Care Professionals

Since I am not enrolled in Medicare and my birthday is in March I was surprised to get this email a few days ago. Obviously Medicare does not follow the best practice used in the business world of verifying email addresses by using a Double Opt-in process. I guess I will continue to get the other Mr. Huber’s Medicare emails until he notices that he is not getting emails from Medicare. Arghhh!

What I found particularly interesting in the email is the fine line between preventive care and what looks like Medicare going the extra yard to drum up business for the health care industry.  I am really curious whether this strategy will achieve different results than the Oregon Medicaid Experiment which showed no statistically significant impact on physical health measures despite increased use of health care services.



Happy Birthday from Medicare! We wish you well in the upcoming year and want to remind you of the preventive services Medicare offers to help you stay healthy.

Our records show that you have not taken advantage of some of the preventive services which are available to you now or in the future and listed in the table below. Please talk with your doctor to decide which ones are right for you.

Name Eligibility Date
COLORECTAL 10/01/2015
PSA 10/01/2015
PROSTATE 10/01/2015
PPV 10/01/2015
DIABETES 10/01/2015
PHYSICAL 10/01/2015

To see more details of the services you are eligible for, visit and select “Preventive Services” under the “My Health” tab. Or, talk to your doctor for more information.

Remember, Medicare is your partner in health.

Centers for Medicare & Medicaid Services.

Things That Make Me Go Hmm… Ohio’s Medicaid costs $2 billion less than estimates

Since I had recently researched Ohio’s Medicaid costs in an effort to understand Cato’s critique of Governor Kasich’s budget growth, I was curious where The Columbus Dispatch article, Ohio’s Medicaid costs $2 billion less than estimates, got its numbers. I remembered that Medicaid was over-budget. So I went back and re-read the Budget Footnotes from the Legislative Services Commission for July 2015 and found this statement on page 18.

Medicaid, which comprises close to half of all GRF program expenditures, was $85.2 million above its fiscal year estimate, and FY 2015 GRF Medicaid expenditures were 9.5% above the FY 2014 amounts.

Since the Legislative Services Commission is the score keeper for the Ohio legislature, I wonder where the head of Ohio’s Medicaid got the $2 billion number.

Congratulations To The Ohio Medicaid Expansion

I saw an article about the Metrohealth experiment several weeks ago but when I went back to find the link I could not find it. Here are some of the highlights in the article, “In Ohio: Medicaid Saves Money, Improves Health”.

MetroHealth, used extensive electronic records to carefully select patients and sent them Medicaid insurance cards before they even applied. Then, they gave each patient personalized attention.

They assigned each patient a nurse. That nurse booked their appointments, called them if they missed one and checked to make sure they took their meds.

Emergency department visits dropped 60 percent. AND primary care visits went up 50 percent.

The hospital ended up spending less on the program than expected, saving an average of $150 on each patient every month.

“Better care, better outcomes, better costs,” Cebul says.

Once again I am reminded that successful health care reforms like this have goals that are defined, measurable, and achievable.  A little less focus on politics goes a long way to making health care reform work better. This is a classic example of management by objectives. Congratulations go out to Mr. Corbett and Dr. Cebul for a job well done!

Why Does the Affordable Care Act Discourage People From Buying Health Insurance?

I read the Yahoo article, Millions Trapped in Health-Law Coverage Gap, and was reminded of one my pet peeves with the Affordable Care Act. Why does the ACA push people into Medicaid if they want to buy subsidized health insurance on the exchange? If someone whose income is less than the Federal Poverty Limit wants to buy health insurance rather than receiving “free” Medicaid, it sounds like they think they belong in the middle class, their income problem is temporary, and they are taking personal responsibility for their health. This is the type of behavior health care reform should be encouraging rather discouraging.

Variations on an All-Payer System

For some time I have been toying with a single rate solution for some of our healthcare problems with the poor and the elderly. The disparity in prices paid for the same health care service between Medicaid, Medicare, insurance companies, and uninsured patients is the definition of insanity. It is hard to believe that we actually believe we can reform health care when we keep pricing the services the same stupid way over and over again. Pricing insanity equals lots of unintended consequences. After reading a blog post on The Incidental Economist I realize that this system is called an “all-payer rate setting”. So here are my ideas:

  • All-Payer Rate Setting for the Poor
  • All-Payer Rate Setting for the Elderly
  • All-Payer Rate Setting for the High Cost Patients

All of these groups suffer from price insanity. My inner MBA say that a mutually acceptable price for a health care service exists between the Medicaid, Medicare, and the insurance company prices. The all-payer rate setting for the poor would close the gap between Medicaid, the insurance companies, and the uninsured. Hopefully this would minimize the financial impact of coverage gaps caused by Medicaid churning. Likewise the all-payer rate setting for the elderly would close the gap between Medicare, the insurance companies, and the uninsured. In this case I am referring to the elderly as older than 55 and hopefully it would reduce the impact of community rating on individual insurance group market and take advantage of Medicare pricing power. The all-payer rate setting for the high cost patients is an attempt to control or cap costs. If we combine all-payer pricing with a discount schedule based on income and family size like they have at Trihealth, we probably have a pretty sane pricing solution for the groups who have the greatest financial risk from a health care disaster. The loser in all of these cases is the hospitals, doctors, and drug companies but these are the folks who benefited from the price insanity. This is what you should expect when the U.S. total health expenditure (PPP) per capita leads the rest of the world by a considerable margin.

Why Did So Many People Sign Up For Medicaid Through The Exchanges?

The more I learn about Medicaid the more I am puzzled why so many people signed up for Medicaid through the exchanges. With all of the churning Medicaid causes I doubt the people who are already familiar with Medicaid are thrilled that they are signed up again. Despite the web site problems they came in droves. I suspect they were hoping for free health insurance and got Medicaid instead. That has to be disappointing. It is the old bait and switch routine. So the sales technique we find reprehensible for used car dealers is okay for government health exchanges? So now we are left with the question, how many of these Medicaid signees are actually benefiting from Medicaid expansion or are most of the Medicaid signees benefiting from better health care in name only?