As Obamacare spreads in Kentucky, the state remains conflicted about it and other forms of government help

By Al Cross
Kentucky Health News

Even as Obamacare coverage spreads in Kentucky, more widely than in almost any other state, the commonwealth remains conflicted about it and other forms of government aid -- creating a political battle that is likely to continue at least until the November 2014 elections, and perhaps into the governor's race in 2015.

The federal health-reform law and its presidential namesake have been the centerpiece of the U.S. Senate race, with Republican Sen. Mitch McConnell railing against it, primary challenger Matt Bevin saying McConnell hasn't done enough to dismantle it, and likely Democratic nominee Alison Lundergan Grimes keeping mostly mum as she waits for the political landscape to settle.

McConnell's Kentucky strategy is part of a national game plan, in which "Republicans are launching a class war with racial undertones—and hurting the poor whites they'll need to win in 2014," the respected, non-partisan National Journal said in a cover story in its weekly magazine over the weekend, reported from Louisville by political writer Beth Reinhard. It is titled "Return of the Welfare Queen," a trope popularized by Ronald Reagan.

Reinhard first looks beyond Kentucky, noting that "25 Republican-led states have — astoundingly" rejected expansion of Medicaid under the law. "To justify this unprecedented rejection of federal relief, these governors and state lawmakers say they just do not believe Washington will keep its promise to pick up the tab. Republicans in Congress are egging them on, denouncing Obamacare's disastrous launch as proof of the arrogance and folly of big government."

"The chances of the federal government picking up the tab for the newly eligible Medicaid people long term is zero, which means that the next governor, whoever that may be, is going to be stuck with a huge, huge problem," McConnell said at a Nov. 12 press conference which he limited to the subject of Obamacare. "The Medicaid expansion that we have already experienced, the Medicaid increases that we've already experienced, is the principal reason your kids' college tuition is going up. . . . So we're paying for it already."

National Journal's coverage has a video, the middle frame of which
shows Gov. Steve Beshear and House Minority Leader Nancy Pelosi.

Thus did McConnell conflate recent increases in Medicaid spending with Democratic Gov. Steve Beshear's expansion of the program to households earning up to 138 percent of the poverty line, from the current 69 percent. That will cost the state nothing for three years, because the federal government will pay the entire cost of care for the newly eligible. In 2017, the state will begin to hep out, hitting the law's 10 percent cap in 2020.

Reinhard notes that Republican "tirades" also target food-stamp recipients, and "Pitting makers against takers is simply smart, hardball politics for some Republicans whose "primaries that will be largely decided by a mostly white conservative base that hates the welfare state. . . . Class warfare can work in a primary. But, ultimately, Republicans' scorn for antipoverty programs hinders the party's efforts to expand beyond its conservative base."

Reinhard writes, "This opposition carries an unmistakable undertone of class warfare, a theme easy to exploit in states such as Kentucky, packed with low-income white voters who have a strong distaste for the federal government. To hear the rhetoric coming from Capitol Hill and the campaign trail, Medicaid and food-stamp recipients are a bunch of shiftless freeloaders living high on king crab legs and free health care, all on the backs of hardworking Americans."

But sometimes people who hold those opinions are relying on the government, too. Reinhard writes about Terry Rupe of Louisville, whose "household's $13,000 yearly income comes exclusively from Washington," and whom she met at a clinic where he was signing up for Medicaid: "The 63-year-old widower can't remember the last time he voted for a Democrat, and he's got nothing nice to say about President Obama. He's also never had health insurance, although he started working at age 9. Since his wife's death four years ago, he's been taking care of their 40-year-old, severely disabled daughter full time. She gets Medicaid and Medicare assistance."

Nevertheless, Rupe told Reinhard, "I don't have any use for the federal government. It's a bunch of liars, crooks, and thieves, and they've never done anything for me. I'm not ungrateful, but I don't have much faith in this health care law. Do I think it's going to work? No. Do I think it's going to bankrupt the country? Yes." Reinhard cites a poll which found that "A majority of whites believe the health-care law will make things worse for them and their families."

Next Reinhard introduces us to Adele Anderson, a white, middle-aged woman who gets $10 an hour for child care and $86 a month in food stamps, and was also signing up for Medicaid. She told Reinhard, "Democrats are too liberal. They just want to give handouts."

Reinhard observes, "The disdain she and Rupe show toward living on the government dole at the very moment they are doing just that is typical in a state that distrusts Washington as much as it needs federal help. . . . Still, Obamacare is so politically toxic that McConnell continues to flog the law that appears to be working in his own state. What's more, he's disqualifying its fledgling success by inciting class warfare."

At his Nov. 12 press conference, McConnell noted that more than 80 percent of Obamacare signups in Kentucky had been for Medicaid, and said, "You know, if I went out here on the street and said, ‘Hey, you guys want free health care?’ I expect I’d get a lot of sign-ups. The most successful part of it has been if you’re talking about getting people signed up is people who are signing up for something that’s free."

In response, the Grimes campaign issued a written statement: "It's unfortunate that Sen. McConnell chooses to look down on Kentuckians who need health care, instead of working to fix the problems. He ought to help those Kentuckians, not attack them."

Reinhard notes that Grimes has yet to say whether she supports the Medicaid expansion, but concludes: "Because Kentucky did take the cash, 308,000 poor people are now eligible for health insurance in the Bluegrass State. Over the 11 months leading up to the election, McConnell and other Republicans opposing Medicaid expansion will be hard-pressed to explain why they want to take health insurance away from needy constituents who belong to their own party." (Read more)

McConnell shares excerpts from letters he received from Kentuckians who are frustrated by health-reform law

By Melissa Patrick
Kentucky Health News

Continuing his attack on Obamacare, Senate Republican Leader Mitch McConnell took to the floor last week to read excerpts from letters he received from Kentuckians who are angry about the Patient Protection and Affordable Health Care Act. UPDATE, Dec. 17: He did so again today; video is here.

Generally, the main issues cited by McConnell are frustration with President Obama's promise that people happy with their health insurance could keep it; anger that their premiums and deductibles had increased under new policies that meet the law's requirements; and dissatisfaction with their inability to choose and pay for only the services they wanted. For example, several constituents said they did not have children, but were required to pay for pediatric dental care and maternity care.

A 35-year-old college graduate and married father of two from Bowling Green told McConnell that his plan, which he said best met his family's needs, had been canceled. As he sought a new plan that met the requirements, he was told it would cost 124 percent more. He noted that Vice President Joe Biden said Sept. 27 that a family of four with $50,000 income could get health insurance for "as little as $106 per month." McConnell said the Bowling Green man was quoted a price eight times that amount and asked him, "Why should the price of a product be based on my ability to pay?" The law provides subsidies for insurance coverage based on income and the type of plan purchased through the state insurance exchange, Kynect, up to $94,000 for a family of four.

Sherry Harris of Nicholasville told McConnell she was concerned that Lake Cumberland Hospital in Somerset was not on the Anthem network, "which means anybody in Pulaski and surrounding counties that qualify for a subsidy and want to use it will have to drive to London, Corbin or Lexington to get care" if they have an Anthem policy. Insurance companies are being more selective about their care networks in an effort to reduce costs; for details, click here.

A "Mr. and Mrs. Spears" of Louisville told McConnell that when they signed her up for the Kentucky Health Cooperative plan on Kynect, they did not sign up for a subsidy and thus were told no income verification was necessary.  Since then, they have received mailings from the insurance exchange declining coverage unless they sent income verification.

Exchange spokeswoman Gwenda Bond told Kentucky Health News in an email, "A request for additional documentation related to income verification might be generated, if they are likely to qualify for a subsidy based on the information provided on the application. Everyone is eligible to purchase a qualified health plan at sticker price at any time." The sticker price is the amount before the subsidy is subtracted.

Mrs. Spears also questioned the exchange's request for her voter-registration information. Bond said the federal "motor voter" law requires public-assistance agencies to ask applicants if they would like to register to vote. "Because Kentucky’s exchange is a single streamlined system for both Medicaid and subsidies, applicants are asked if they would like to register to vote," she said. "A voter registration form is mailed to them if they request one. There is no follow-up related to whether an individual registers or not, and it does not have an impact on coverage."

Mike Conn of Prestonsburg was upset that a policy with similar coverage to his previous policy would cost double.  He told McConnell that he was informed by the individual who helped him find coverage that it was because he lived in Eastern Kentucky and his old insurance company was "apparently not available there." Humana Inc. chose not to offer plans in all parts of the state.

Federal budget deal targets Medicare payments, and that means Kentucky hospitals won't be happy

Looking for a way to localize the budget deal announced by congressional negotiators last night? Call up your local hospital.

David Rogers of Politico reports that hospitals are "furious with the fact that the deal offers no relief from future cuts on Medicare providers – and even extends these annual 2 percent reductions into 2022 and 2023." The cuts would be a continuation of those imposed by the "sequester" legislation that took effect when Congress failed to reach an anticipated deal on the federal deficit and taxes.

The $28 billion extension of the cuts, almost a third of the $85 billion total, "helps to dress up the package with tens of billions in savings, but at a time when hospital networks are already feeling the impact of health-care reform, there is a fear that Congress is not seeing the long term impact of these budget assumptions," Rogers writes.

Most rural hospitals are already facing Medicare cuts because reform law reduces the extra payments made to hospitals that have large percentages of Medicare patients. Those hospitals are disproportionately rural.

The deal also includes "a provision that aims to prevent fraud and abuse in the Medicaid program for the poor and disabled," Modern Healthcare reports. "According to a summary, the provision allows states to delay paying for suspect claims as long as the delay does not harm a beneficiary's access to care. It also would allow states to collect medical child support in cases where health insurance is available from a non-custodial parent and allows Medicaid to recoup costs from beneficiary-liability settlements."

Why cut Medicare payments? "Congressional staffers were not prepared to talk about the cuts on the record, but said it boiled down to Medicare providers being the least painful target. Democrats, they noted, have not traditionally been strong supporters of preserving the payments to providers, being much more concerned with maintaining funds for beneficiaries. Republicans saw extending for two years cuts that are already in the law for mandatory programs as a simple way to add deficit reduction to the replacement of sequestration for discretionary programs," Michael McAuliff reports on The Huffington Post.

Free clinics are wary of how health reform will affect them

By Melissa Patrick
Kentucky Health News

Free health clinics for the uninsured face an uncertain future as the Patient Protection and Affordable Health Care Act is implemented. Kentucky has more than 50 such clinics.

The Anderson County Community Medical Clinic, which just celebrated its one-year anniversary this month, serves uninsured people in its community and faces a "threat with the power to close its doors for good: Obamacare,"  Meaghan Downs of The Anderson News reports. Still, several board members told Downs that they do not expect to have to "shut down anytime soon" because some people will remain uninsured even though the health-reform law requires all Americans to sign up for health insurance or face a penalty.

“As long as the people qualify as living in Anderson County and having no insurance, we’re going to serve them,” Opal Phillips, the non-profit clinic's board chairman, told Downs. “If we are at the end of our usefulness, we will be there until we are no longer needed.”

Since it opened, the clinic has seen about 175 uninsured patients with chronic illness, Phillips told Downs. Lately, he said, the clinic has encouraged patients to sign up for coverage through the state's health-insurance exchange, Kynect.

The state says Kentucky has more that 640,000 uninsured citizens, or 15 percent of its population, and 308,000 will qualify for the expanded Medicaid program, but only about two-thirds of those people are expected to sign up.

Funding is another concern for free clinics under the reform law. Jane Bennett, the Anderson County clinic board's secretary for the last three years, told Downs that she is "extremely concerned about the health-care law and how that will affect fundraising for the clinic in the new year."  After the initial start-up funding from donations, the clinic must continue to find ways to pay for all of its services.

Bennett also told Downs that board members at the clinic may need to change the way it does business by changing the requirements on the types of patients they see. She went on to tell Downs that the uncertainty of how many will be uninsured after the exchange closes and taking into consideration the "blips" that occurred in the roll-out, the implementation of the law will take time.

Laura Ebert, president of the Kentucky Free Health Clinic Association, told Downs that she estimates it will be "at least two years before clinics like Anderson's will see any impact from Obamacare."  Many lower-income people, she said, "may not even take the first step to sign up for exchanges because of a lack of access to technology or education about the new health care law. There will still be a great need for clinics like hers and Anderson County’s."  She said "22 million Americans will still be uninsured even after every element of the federal and state exchanges are put into place," Downs reports.

Ebert is also the executive director of Surgery on Sunday, a clinic in Lexington that performs free outpatient surgeries for free to income-eligible individuals and their families. She told Downs that future considerations for this clinic and the other 54 free clinics across the state will be whether they will have to start accepting Medicaid patients or any patients eligible for state or federal assistance or allow the local health department to take over their services. The Owensboro health department and Danville's Ephraim McDowell Regional Medical Center "are two medical facilities that have absorbed formerly non-profit clinics," Downs reports.

Family Health Centers, which has seven community health clinics in Louisville, is free for those who are unable to pay, but it also accepts insurance. Its primary concern is how their business will need to change in order to not lose patients to local private practices that only accept insurance, Abby Goodnough reports in The New York Times.

"They expect their patient load to double, even as they struggle to recruit doctors and other staff members," Goodnough reports.  The clinics have focused on improved customer service and efficiency as they prepare for the expected changes the health care reform will bring. These efforts include: installing an appointment system instead of the current first-come, first-serve system, improving their facilities through the money allotted in the health care reform and converting to electronic medical records.

UPDATE, Dec. 21: The New Hope Clinic in Bath County "expects to continue serving patients who fall through the cracks," reports cn|2, a service of Time Warner Cable. Clinic Director Bill Grimes told senior reporter Don Weber that the expansion of Medicaid to households with incomes up to 138 percent of the federal poverty level will cover about 2,000 of the clinic's 2,700 patients. "Julia Maness, a nurse practitioner who is one of the New Hope Clinic’s co-founders, says she expects the first year under the Affordable Care Act to expose many issues that cause individuals to fall through the cracks," Weber reports.

Beshear says other governors will follow his lead on Medicaid

Associated Press file photo

Gov. Steve Beshear says states that have not expanded the Medicaid program under the federal health-reform law, as he did, will do so in the next few years because their voters will demand it.

“I believe the pressure will be so great over the next three or four or five years, on the states that haven’t gone in this direction, that they will end up just where Kentucky is,” Beshear told Alexander Burns of Politico, in the governor's latest appearance in a national publication.

Burns writes, "It’s precisely the message national Democrats are aching to hear, even – or perhaps especially – from a source as unexpected as a pro-gun, pro-coal, red-state governor who once endorsed using state tax incentives to build a creationist theme park."

The story, headlined "Kentucky's unlikely health care heartthrob," focuses on Beshear's high national profile stemming from his expansion of Medicaid to people earning up to 138 percent of the federal poverty line and the state's successful rollout of a website that is enrolling about 1,000 people a day in Medicaid or private insurance -- unlike the federal government's site, which seems to be getting in order after a disastrous rollout that made many Democrats nervous. He is the only Southern governor to take both steps.

"For anxious national Democrats who have pined for a white knight in the health-care reform debate, Steve Beshear is starting to look like the one they’ve been waiting for – implausible as that development may be," Burns writes. "Amid a torrent of negative national headlines about the Affordable Care Act, the 69-year-old Kentucky governor – a canny Southern operator who’s spent his career at arm’s length from the [national] Democratic base – has charged out of Frankfort as a kind of ambassador-by-default for the controversial law."

Burns says the verdicts on the state and national programs are "far from decided, but Beshear says his mind is entirely made up on both the merits and the politics of health care. From his perspective, voters’ opposition to the ACA is driven largely by a sense of anxiety about how the program may change their lives. If they find a year from now that the law has left their personal care unchanged, or even improved it, public opinion could shift quickly."

State Senate Republican Floor Leader Damon Thayer, "a leading Obamacare critic in the state, said Democrats would pay a price for Beshear’s decision to 'channel his inner liberal Democrat with no election ever facing him again in the future'," Burns writes, quoting Thayer: “While it appears that Kentucky has done a competent job implementing a website, it’s still a bad policy. . . . The people of Kentucky don’t like the fact that he has unilaterally implemented Obamacare without legislative approval, and they don’t like Obamcare.” (Read more)

Beshear says Medicaid plan will transform Ky. in a generation; acknowledges it was easier because he wouldn't face voters

In a generation, Kentucky will be a very different state because the federal health-reform law and expansion of Medicaid has made health insurance available to all residents of the state, Gov. Steve Beshear told Los Angeles Times political reporter Mark Z. Barabak for a story the paper published on Thanksgiving Day. And he acknowledged that his Medicaid decision was easier because he can't seek re-election.

"I knew if I was going to make a huge difference in the health status of Kentucky, it was going to take some kind of transformational tool to do that, and that's what the Affordable Care Act is for me," Beshear told Barabak. "I think we've started something here that a generation from now you'll see a very different Kentucky than what you see today."

Beshear "conceded, with a small smile, that it was easier knowing he would never face voters again," Barabak writes. "Embracing Obamacare is not without political risk. Undaunted by the early success in Kentucky, Republicans plan to make the controversial program a major issue in 2014, when the GOP will be vying to take control of the state House for the first time in close to a century."

Politics aside, "The need for care in this pretty but hard-pressed state is unarguable," Barabak writes. "Kentucky leads the nation in cancer deaths and preventable hospitalizations and suffers some of the highest rates of diabetes, cardiovascular illness and premature death." But he says "Kentuckians may feel understandably whiplashed" because the state's Republican U.S. senators firmly oppose "Obamacare." (Read more)

Not only may you not get to keep your plan under Obamacare, you might not be able to keep your doctor; there are reasons

By Molly Burchett
Kentucky Health News

Part of the sales pitch for the federal health-care reform law was that people could keep their doctors, but many Americans and some Kentuckians won't because insurers are excluding some hospitals and doctors from policies in an effort to make the new, standardized plans on the insurance exchanges more affordable.

Eleven Kentucky hospitals have filed complaints with the state Department of Insurance, saying Anthem's policies on the state's exchange include only a narrow network of providers, excluding them. Limiting the number of providers on the exchanges is one seldom-mentioned way insurers are trying to reduce premiums for new policies.

The department upheld three of the complaints because the hospitals said they would be able to serve at least four of the state's eight Medicaid regions, a concern that led to their original exclusion. The department has since ordered Anthem to accept applications from those hospitals- UK Healthcare, Our Lady of Bellefonte in Ashland and Highlands Regional Medical Center in Prestonsburg, reports Mike Wynn of The Courier-Journal.

Insurance-company research shows that consumers’ highest priority when shopping for insurance is price. To compete on price, insurers contract with doctors and hospitals who charge them the lowest fees. Some prestigious and well-known academic medical schools that charge higher prices are being excluded from exchange plans, Forbes magazine reports.

These same market forces may also limit the ability for small hospitals and providers to provide care through exchange plans if their health systems lack economies of scale that enhance their negotiating power. UK has already negotiated a deal with Anthem, and the company's negotiations with Highlands and Bellefonte are ongoing.

Anthem is not the only insurance company with narrow networks. Stephen Miller, vice president of finance for the Kentucky Hospital Association, said other Kentucky insurers are also using network restrictions to "steer patients to hospitals with the best rates for the insurer," Wynn reports. Around the country, many plans have more narrow networks than previous plans in order to limit premiums, Politico reports.

This tactic lowers expenses for the insurers by bypassing higher-priced health systems but means that some patients may have to change doctors or hospitals, report Sandhya Somashekhar and Ariana Eunjung Cha in The Washington Post: "The result, some argue, is a two-tiered system of health care: Many of the people who buy health plans on the exchanges have fewer hospitals and doctors to choose from than those with coverage through their employers."

Consumer advocates say tighter networks will disrupt care and limit access for middle-and lower-income consumers, who may be sicker than the average consumer, reports Kaiser Health News: "Narrow networks present the opportunity for lower costs via discounts from select hospitals and doctors in return for patient volume. But smaller networks can require members to travel farther for care or make it hard to get appointments."

Anthem says limiting networks helps insurers save money, which is passed on to patients through reduced premiums. Critics say healthy people must pay more than their fair share to help provide coverage for sicker people. Health-reform advocates say the law's trade-offs are acceptable costs in exchange for getting health coverage to more needy people, but some wonder about that if they have to drive 30 miles to get it.

What is a narrow network?

An insurance company's health-care network is a group of physicians, hospitals and other providers that agree to provide medical services at pre-negotiated rates. The wider the insurance company's network, the more doctors and hospitals from which you can choose without paying more to see an out-of-network provider.

Anthem spokesman Tony Felts said the smaller networks are an attempt to keep exchange plans affordable and that the company worked hard to design products that would attract consumers to them. Four other companies are offering policies on Kynect, the state exchange: Humana, United Healthcare, Bluegrass Family Health and the Kentucky Health Cooperative. Anthem and the cooperative are the only two insurers offering individual plans statewide.

"Many companies have selectively entered the exchanges because they are concerned that they will be dominated by risky, high-using populations who wanted insurance and couldn't afford it" before the law took effect, Gail Wilsensky, a UnitedHealth director, told U.S. News. "They are pressed to narrow their networks to stay within the premiums."

The reform law requires insurers to provide enough doctors and hospitals to ensure quality care, but the federal government offers little guidance on how this is defined. The Kentucky Heath Benefit Exchange says at least 20 percent of available essential community providers in an exchange service area must be in its network, and insurers must contract with at least one of these providers in each county in the service area. However, these regulations don't specify a penalty for not adhering to the recommendation, and there is no guarantee that the network includes your doctor.

Consider a plan's network, premiums and out-of-pocket amounts

Patients may not realize whether or not their doctor is in a plan's network until January, when the new policies take effect. Therefore, consumers should be careful to check the details about an exchange plan's network. Consumers should also be aware of the plan's out-of-pocket costs; the cheapest exchange plans have high deductibles.

On Kynect, insurance shoppers can filter plans to see if a specific provider is included. Insurance Department spokeswoman Gwenda Bond said the agency relies on insurance companies to provide network information to be posted on the exchange. She said the department has experienced some minor issues with this process due to insurers using different names for the same provider.

To address this problem, Kynect also provides a link to each issuer’s web site for their provider directory, said Bond. "The issuer’s provider directory web site should contain the most current list of providers available in the issuer’s network. We continue to work with insurance companies to improve the lists," she said.

"Under Obamacare’s exchanges, people who really want to keep their doctor, at any price, will often have to pay higher premiums for the privilege. And people who prefer lower premiums, above all, might need to choose a different doctor," writes Avik Roy of Forbes.

As Medicaid enrollment grows, fewer providers accept it

At the same time some providers are being excluded by insurance companies or are choosing to exclude themselves, some providers are opting out of the exchanges and are not accepting Medicaid patients. A recent survey by the Medical Group Management Association found that 40 percent of its members are still deciding if they are going to accept insurance offered on the Obamacare marketplaces, CNN reports.

About 56,000 Kentuckians have enrolled in Kynect plans as of Nov. 22, and 82 percent of those are Medicaid plans. According to the Centers for Medicare and Medicaid Services, which administers the Medicaid program, three times more doctors are refusing Medicare patients than three years ago.

Doctors cite Medicare's increasing rules and lowered payment rates as reasons for not accepting Medicaid, and those who will see some Medicaid patients are limiting the number, reports The Wall Street Journal. Doctors also say administrative hassles and delays in getting paid also discourage them from accepting Medicaid, says the Center for Studying Health System Change.

Hospitals across the state have expressed concern about delayed payments from Kentucky's managed care companies as a result of the state's quick transition to a managed care model, and state officials are working to address this problem. Still, Kentucky's Medicaid payment rates are about 72 percent of Medicare rates. The reform law raised Medicaid fees to match what Medicare pays primary-care doctors, but only for two years and after much administrative hassle.

Haynes asks hospitals for a truce as they and state work through problems with managed-care Medicaid

Health and Family Services Secretary Audrey Haynes won a smattering of applause from Kentucky hospital officials Thursday as she called for "not a surrender, but a truce" as her cabinet continues to address the hospitals' complaints about the state's managed-care system for Medicaid, which recently entered its third year.

Haynes drew the ire of hospitals last month when she said some needed to change their business models to emphasize prevention and wellness, not cashing in on Medicaid payments for emergency-room care. Thursday, she said in a speech to the Kentucky Hospital Association in Louisville that she wants "to work more closely together, not only to improve your business practices," but to improve the health of Kentucky.

Haynes also called on the hospitals to join Appalachian Regional Healthcare and the University of Kentucky hospital in contacting past patients who lacked insurance and urge them to sign up for expanded Medicaid or private insurance on the state's Kynect website, under federal health reform. "I need your help," she said. "we're very excited about the opportunity for dramatic improvements in Kentucky's health status."

Also at the meeting, state Rep. Jimmie Lee, D-Elizabethtown, the House's health-care budget subcommittee chair, said he thought Haynes and the administration of Gov. Steve Beshear had largely resolved the "prompt pay" problems of hospitals not getting money they are owed by insurance companies. But Senate Health and Welfare Committee Chair Julie Denton, R-Louisville, called for more action on the subject, such as an independent review panel to review disputed claims.

Ky. Hospital Association defends 'critical access' designation that gives small, rural hospitals a federal financial boost

The Kentucky Hospital Association came out strongly for continued federal support of small, rural hospitals Thursday, objecting to a proposal that the "critical access hospital" designation be based entirely on distance from other hospitals. Kentucky has 29 such hospitals, which get slightly higher Medicare and Medicaid reimbursements in return for limiting their size and services.

Until 2006, states were allowed to make the designation based on a community's health status, poverty rate, rural nature and other factors. So many were designated that they became the majority of critical access hospitals. That is also the case in Kentucky.

The Office of Inspector General of the U.S. Department for Health and Human Services said in August that the government could save up to $1 billion a year if the designation were limited to the original criterion, being at least 35 miles from another acute-care facility, or 15 miles in mountainous areas. KHA's initial repsonse is here.

"The OIG report seeks to eradicate rural health care by shutting down rural hospitals," said Charles Lovell, CEO of Caldwell Medical Center, a critical access hospital in Princeton. "People call us Band-Aid stations," but he could provide a long list of lives saved at his hospital, he said. Other speakers cited hospitals' important role in providing jobs and recruiting doctors for small towns. Cutting the list "would only hurt our communities' physical and economic health," said Susan Starling, CEO of Marcum and Wallace Hospital in Irvine.

Fran Feltner, director of the University of Kentucky Center of Excellence in Rural Health, noted that it was National Rural Health Day and said, "I believe every Kentuckian should have access to the right care at the right time, and close to home."

Critical access hospitals make up only 22 percent of Kentucky hospitals, but maintaining their extra reimbursement would also help the chains that own some of them, because costs of the chain can be allocated to individual hospitals. Here are the critical access hospitals in Kentucky, by county:
Allen: The Medical Center at Scottsville
Breckinridge Memorial Hospital, Hardinsburg
Caldwell County Hospital, Princeton
Carroll County Hospital, Carrollton
Casey County Hospital, Liberty
Cumberland County Hospital, Burkesville
Estill: Marcum and Wallace Hospital, Irvine
Floyd: McDowell Appalachian Regional Hospital; Saint Joseph Martin
Grant: St. Elizabeth Medical Center Grant County, Williamstown
Green: Jane Todd Crawford Hospital, Greensburg
Hart: Caverna Memorial Hospital, Horse Cave
Knox County Hospital, Barbourville
Leslie: Mary Breckinridge Hospital, Hyden
Lincoln: Ephraim McDowell Fort Logan Hospital, Stanford
Livingston Hospital and Healthcare, Salem
Madison: Saint Joseph Berea
Marshall County Hospital, Benton
Mercer: James B. Haggin Memorial Hospital, Harrodsburg
Morgan County Appalachian Regional Hospital, West Liberty
Nicholas County Hospital, Carlisle
Ohio County Hospital, Hartford
Owen: New Horizons Medical Center, Owenton
Russell County Hospital, Russell Springs
Simpson: The Medical Center at Franklin
Trigg County Hospital, Cadiz
Union: Methodist Hospital Union County, Morganfield
Wayne County Hospital, Monticello
Woodford: Bluegrass Community Hospital, Versailles

Beshear and two other Democratic governors say Obamacare is working in their states, and cite examples

Gov. Steve Beshear continues to be a major national cheerleader for the federal health-reform law, citing Kentucky examples in an op-ed piece he and the Democratic governors of Connecticut and Washington circulated to newspapers this week.

"People keep asking us why our states have been successful," they write. "Here’s a hint: It’s not about our websites. Sure, having functioning websites for our health-care exchanges makes the job of meeting the enormous demand for affordable coverage much easier, but each of our state websites has had its share of technical glitches. As we have demonstrated on a near-daily basis, Web sites can continually be improved to meet consumers’ needs. The [Patient Protection and] Affordable Care Act has been successful in our states because our political and community leaders grasped the importance of expanding health-care coverage and have avoided the temptation to use health-care reform as a political football."

All three governors expanded the Medicaid program to include people with incomes up to 138 percent of the federal poverty line. Beshear cites two independent studies that showed Kentucky "couldn’t afford not to expand Medicaid. Expansion offered huge savings in the state budget and is expected to create 17,000 jobs." The state will have to start helping pay for the expansion in 2017, but Beshear has argued that the economic activity from more health care will cover that bill.

At least one of Beshear's co-authors, Washington Gov. Jay Inslee, is not allowing insurance companies to renew policies that don't comply with the law, as President Obama allowed last week. But they wrote, "What we all agree with completely, though, is the president’s insistence that our country cannot go back to the dark days before health-care reform, when people were regularly dropped from coverage, and those with 'bare bones' plans ended up in medical bankruptcy when serious illness struck, many times because their insurance didn’t cover much of anything.
Thanks to health-care reform and the robust exchanges in our states, people are getting better coverage at a better price."

As an example, Beshear cited Howard Stovall, whose sign and graphics business in Lexington "has paid half the cost of health insurance for his eight employees" since it opened in 1998. "With the help of Stovall’s longtime insurance agent and Kentucky’s health exchange, Kynect, Stovall’s employees are saving 5 percent to 40 percent each on new health insurance plans with better benefits. Stovall can afford to provide additional employee benefits, including full disability coverage and part of the cost of vision and dental plans, while still saving the business 50 percent compared with the old plans." (Read more)

Pike County officials urge newly eligible residents to sign up for health insurance before Dec. 15

A call to action.

That's what Pike County officials are calling their efforts to encourage citizens to sign up for health care insurance, as called for by the Patient Protection and Affordable Care Act, reports Russ Cassady of the Appalachian News-Express in Pikeville.

The act and the state's expansion of Medicaid under the law have made an estimated 9,915 people in the state's easternmost and geographically largest county eligible to receive health insurance, county Social Services Commissioner Carol Napier said at a Fiscal Court meeting last week.

“Of that number, 5,127 are now eligible for Medicaid,” she said, adding that 3,984 others are eligible to get subsidies for private health insurance.

The call to action also reminds people to apply before Dec. 15 to assure that their coverage will begin Jan. 1, Cassady reports. “There’s still yet those individuals that are under the impression that they don’t qualify,” Napier said.

Judge-Executive Wayne T. Rutherford, at the same meeting, reminded Pike County residents who apply through the state insurance exchange that they will not have to go through the national system, Cassady reports.

Kentucky's online health insurance exchange, Kynect, hailed by some as the best Obamacare website, is available to all Kentucky residents to explore their options, find out if they qualify for subsidies, and sign up for health insurance.

Cassady's story gives a list of local Kynect assistance sgencies, where people can call to ask questions or request help:
 • Pike County Health Department, (606) 437-5500
 • Mountain Comprehensive Care Center, (606) 432-3143
 • Big Sandy Area Development District, (606) 886-2374
 • Appalachian Research and Defense Fund of Kentucky, (606) 886-3876
Citizens of Pike County can also call the county Social Services office at (606) 432-6246 with questions about their eligibility for health insurance under the Patient Protection and Affordable Care Act. (Read more; subscription may be required)

FactCheck.org finds little support for Sen. Rand Paul's claim that Medicaid expansion will 'bankrupt' Kentucky hospitals

U.S. Sen. Rand Paul said on ABC's "This Week" Sunday, Nov. 3 that the federal health-reform law may "bankrupt" rural Kentucky hospitals "by overwhelming them with Medicaid patients." However, health-care leaders in the state "say its hospitals stand to benefit, since the expansion would provide insurance to those who otherwise wouldn’t be able to pay their hospital bills," reports FactCheck.org, a nonpartisan service of the Annenberg Public Policy Center at the University of Pennsylvania.

Sen. Rand Paul (ABC News)

Paul made his remarks when host George Stephanopoulos asked him if the successful launch of the state's insurance exchange showed that Obamacare can be successful. "Well, nearly 90 percent of them are signing up for Medicaid, free health insurance from the government," Paul replied. "My concern is not that we shouldn’t help people. I do want to help these people to get insurance. But there is going to be a cost. And in my state, we have a lot of rural hospitals that teeter in the balance. My fear is that these hospitals may be bankrupt by overwhelming them with Medicaid patients."

At the time Paul spoke, the latest figures were that 85.7 percent of Kentucky enrollees were in Medicaid. A week later, the figure had declined to 82 percent of a total of 40,572. Exchange Director Carrie Banahan said Nov. 10 that she expects the Medicaid percentage to be about 70 percent by Dec. 31. She noted that Medicaid qualification is faster than enrolling in a private health plan because the income qualification is automatic, and 16,425 people have been determined eligible for subsidies for private plans through the exchange.

Gov. Steve Beshear announced in May that the state would expand Medicaid to people with incomes up to 138 percent of the federal poverty level; the previous threshold was 69 percent.

Eugene Kiely of FactCheck notes that the Robert Wood Johnson Foundation and Urban Institute said in March 2013 that hospitals should expect more revenue from Medicaid expansion; that the month before, Kentucky Hospital Association President Michael Rust said likewise; and so did Foundation for a Healthy Kentucky President Susan Zepeda several months earlier.

"That’s not to say there are no concerns in Kentucky about expanding Medicaid," Kiely writes. The state does not have enough medical providers to serve its population, even without the 300,000 residents who are newly eligible for Medicaid. In an email to Kiely, Zepeda said the foundation "remains very concerned about the capacity of the state's health-care system, particularly in rural areas, to cost effectively care for a much larger number of patients."

Zepeda also noted the problems that hospitals have had being paid by insurance companies that are now managing Medicaid for the states, but the foundation "still believes the state’s residents and hospitals will benefit from the expansion," Kiely reports.

Paul's staff did not respond to inquiries from FactCheck. For its analysis, click here.

Friedell Committee will consider what it will take for Kentucky to become a healthier state at meeting Sunday and Monday

What will it take for Kentucky to become a healthier state? That will be the question at the fall meeting of the Friedell Committee for Health System Transformation, at the Marriott Griffin Gate in Lexington Sunday, Nov. 10 and Monday, Nov. 11. Participants will examine how the committee can work with communities and individuals to create a Kentucky that is “healthier, wealthier, and wiser,” a possible motto for a campaign the committee is considering.

“We have learned that building a healthier Kentucky will depend largely on what we do beyond the health-care system,” said Richard Heine, executive director of the committee. ”Efforts to promote good health must take place in the environment where people live, work, and play. For Kentuckians to be healthier, we must address the factors behind the problem of poor health, such as lack of education, poverty, poor nutrition, lack of employment, violence, transportation, and housing.”

Topics at the meeting include the state Health Benefit Exchange, managed-care Medicaid, the state’s financial situation, successful local policy changes, and the prevention and control of Kentucky’s major health challenge: diabetes.

Lee Todd, former president of the University of Kentucky, will be the keynote speaker Sunday evening and will introduce components of the committee’s campaign for a healthier Kentucky, now being formulated. Monday’s morning sessions will focus on public health, with discussions of county health rankings, public health partnerships with communities, and opportunities for progress in the health of Kentucky. Afternoon sessions will look at education partnerships and Kentucky’s workforce.

This meeting is funded in part by a grant from the Foundation for a Healthy Kentucky. For a copy f the full agenda, click here. For more on the committee, click here.

New CEO of Owensboro Health says hospitals are working to improve care, regardless of federal health reform

Philip Patterson, the new CEO of the Owensboro Health, says hospitals are moving towards health reform regardless of what happens with the Patient Protection and Affordable Care Act.

Patterson is coming to Owensboro from Bon Secours Charity Health System in New York and New Jersey, a three-hospital system with net patient revenue of nearly $500 million.  Patterson says he wants to build a stronger network for regional care in the Owensboro area.

The Affordable Care Act has changed physician and hospital payment structures, encouraging wellness participation, Patterson said in an interview with Ryan Alessi of cn|2's "Pure Politics." Patterson said the law creates incentives for hospitals to keep patients from being readmitted, and to only provide necessary care.

Regardless of what happens with the law, health organizations and providers need to be more than providers, Patterson said: They need to be health partners to their communities, to improve community members' overall health by managing care through screenings and education.

The health care law penalizes health systems for providing care that is not needed, and it encourages a change in thinking for providers who need to start providing care more economically, said Patterson. One way to do that is by building a strong network of providers who coordinate care.

"To create a sustainable system, you've got to cover a unique and significant population," he told Alessi. To cover a larger geographic area in New York and New Jersey, Patterson said, he created a loosely affiliated network of independent facilities that all worked toward the common goals of improving care coordination and quality.

As a result of Medicaid expansion in Kentucky, which now covers households earning up to 138 percent of the poverty level, an additional 400,000 people may have health insurance coverage that have never had it before.

"There's always a cost when you build something new and try to integrate a population into it," said Patterson. Unfortunately, those who lack insurance tend to have lower education levels and potentially neglected health care needs as a result of not having coverage or the perception of not having access to health care, Patterson told Alessi.

"The process of making this [integration] work is going to be clearly on the structure of health care providers as they try to manage that population to keep them out of the hospital where the most expense is," he said. Provider networks can coordinate to manage disease processes before they require care, and education and communication about how to access care is crucial, Patterson told Alessi.

Asked what will happen to hospitals if the health law is delayed or repealed, Patterson said, "It really hasn't been rolled out yet. We are still in a wait and see mode in a lot of these pieces." He said if health care systems buy into the law's overall goals, and they are already working towards the goal of better health care management. "The issue is the infrastructure and how to pay for it," he said.

"Repeal? I don't know what's going to happen there. I think as long as the goals are to create a better health model for a community, you're going to work towards them anyway," said Patterson.

Uninsured young adults may qualify for high-deductible health coverage for $50 or less per month on state exchanges

Almost half of single young adults who are uninsured may qualify for coverage for $50 or less per month under federal health reform, according to a report from the U.S. Department of Health and Human Services.

HHS says young adults often qualify for lower costs on monthly premiums through tax credits based on family size and income. A single person's income must not be more than $45,960 to qualify for a tax credit, according to the Kynect website, and lower-income families receive the most assistance.

The federal report examined the 34 federally facilitated and state-partnership marketplaces and found that 46 percent of single young adults (ages 18-34) who may be eligible for coverage could purchase a "bronze" plan with high a deductible for $50 per month or less after tax credits, and 66 percent may be able to pay $100 or less for coverage. The report also found that "an additional 1 million eligible uninsured young adults may qualify for Medicaid in the states that have opted to expand the program in 2014."  (Read more)

Find out about your eligibility at Kynect, Kentucky's online insurance marketplace.

A Ky. guide to the Patient Protection and Affordable Care Act

By Molly Burchett
Kentucky Health News

Few laws have generated as much confusion, opposition or news coverage as the Patient Protection and Affordable Care Act. Despite the flood of news stories about the law widely known as Obamacare, there is still much confusion about it.

That's not surprising. The 906-page law is complex and is accompanied by 10,535 pages of regulations. This guide to the law is designed to clear up confusion and offer various perspectives about how the law may affect you, your family or your business.

What does the Affordable Care Act do?

The law is a set of reforms that impose many requirements on insurance companies and requires all Americans, with very few exceptions, to have health coverage or pay a penalty starting Jan. 1.

Kynect home page

In addition to those mandates, the law created online health-insurance marketplaces and encouraged states to expand the federally subsidized Medicaid program for the poor and disabled. Gov. Steve Beshear expanded Medicaid and decided the state would run its own marketplace or exchange, Kynect, which launched Oct. 1.

Why did Congress pass the law?

The law is designed to extend health coverage, either through private insurance or Medicaid, to Americans without health insurance. More than 47 million Americans were uninsured in 2012, says the Kaiser Family Foundation, and about 640,000 of them were Kentuckians.

The law's rules for insurance will increase costs for many, so it provides Medicaid or subsidized coverage to help qualifying individuals pay for coverage. Those with incomes under 138 percent of the federal poverty threshold qualify for Medicaid, and those with incomes up to 400 percent of the poverty line get premium subsidies. The line for a family of four is $23,550, so such a family would qualify for subsidies if it makes less than $94,200 a year.

Who will be affected by the law?

Obamacare will affect almost everyone, but it will have less impact on people 65 and up because they're eligible for Medicare. Virtually everyone must have health insurance coverage by 2014 or pay a penalty. Beginning in 2015, employers of 50 or more full-time workers (defined as working at least 30 hours a week) must provide coverage for their employees.

Insurance companies can no longer deny coverage because of pre-existing conditions such as a disability, pregnancy, or chronic disease. Under one part of the law that took effect early, parents are able to keep their children on their insurance until the children turn 26.

The law aims to help people who can't get affordable insurance through an employer or who aren't ineligible for public coverage through Medicare or Medicaid. It also affects the self-employed, small businesses and employees of businesses that don't provide coverage.

Because the law is making fundamental changes in the health-insurance system, "In the long run, pretty much every American will be affected by Obamacare," reports Abby Hayes of The Dough Roller, a financial-advice site. "Next year, employer-sponsored insurance premiums are likely to fluctuate as insurance companies adjust their offerings."

Will the law lower health costs?

It's too soon to tell what impact the law will have on costs. Remember, there are two types of health costs: the country's overall cost and the cost that you feel in your pocketbook from the money your household spends on health services.

If you buy an insurance policy through the state exchange, www.kynect.ky.gov, your cost will depend on your individual situation, such as the size of your household and the number of smokers in it, and your income, which will determine your eligibility for subsidies or Medicaid.

Most people who buy coverage in the individual market will pay higher premiums in 2014, mainly because companies are required to cover people with pre-existing conditions and a broader range of services, such as prescriptions, than many people have been paying for.

Rates in the individual market will change yearly, as explained in a report from the Kaiser Family Foundation. It says the broader coverage, and limiting surcharges due to age, will spread the overall cost of care across the insurance marketplace, tending to lower premiums for people who are older and sicker and raise them for people who are younger and healthier. Thus, the trade-off for pre-existing coverage is the individual mandate, which requires everyone to purchase coverage to spread the cost.

Think of it this way: When you go out to eat with two grade-school children, they can order off the kids' menu, so you pay less for their smaller portions. The total bill is $30. Your kids' chicken finger platters are $5 each, and you and your spouse both have $10 items. However, if the restaurant must charge all patrons equally for the same meal, the $30 cost would be assessed differently. The cost for each individuals would be $7.50; the cost of your kids' meals would be higher and you and your spouse's meal would cost less.

Many Kentucky businesses have expressed concern about rising premiums for employee coverage. Some are moving to high-deductible plans that require employees to pay a larger share of their costs, and some may drop coverage, letting employees obtain insurance and subsidies through the government exchanges.

How do I get coverage from the exchange?

The Kynect website will determine your eligibility for Medicaid or subsidies, allow you compare plans and process the insurance application. If you don't have a computer, you can call toll-free to 1-855-459-6328 to apply or locate a local "Kynector."

Unless you qualify for a special enrollment period, you must enroll in a health plan by March 31, 2014. A "life-changing event," such as moving to a new state, major changes in income and changes in family size, can make you eligible for a special enrollment period, says Healthcare.gov, the federal website. (Kentuckians do not use the federal site because the state has its own site, Kynect.)

The date coverage starts depends on when you buy it. If you enroll before Dec. 15 and pay your first premium, your coverage starts Jan. 1. Likewise, in succeeding months, if you enroll between the 1st and 15th, your coverage starts on the 1st of the next month. If you enroll after the 15th, coverage starts the month after the next one.

What do the health plans cover?

Regardless of which plan you chose, the law requires all plans offered by any insurance company to cover these essential health benefits:

1. Ambulatory patient services (outpatient care)
2. Emergency services
3. Hospitalization
4. Maternity and newborn care
5. Mental health and substance abuse services (including behavioral health treatment)
6. Prescription drugs
7. Rehabilitative and habilitative services/devices
8. Laboratory services
9. Preventative, wellness, and chronic disease management services
10. Pediatric services (including oral and vision care) 

What will I pay for a plan?

Premiums depend on individual circumstances, such as income and the level of coverage, such as the amounts of deductibles and co-payments. Kynect is connected to federal databases — including Internal Revenue Service databases — to determine whether you qualify for assistance in paying a premium. People on Medicaid do not pay premiums.

Plans on Kynect vary widely. In addition to comparing premiums, it is important to consider deductibles, co-payments and other plan details. Kynect offers four basic types, labeled bronze, silver, gold and platinum. Bronze plans have the lowest premiums but have a $6,300 deductible. As you move up the plan spectrum to platinum, your premiums increase and your deductibles decrease. The exchange also offers people under 30 a plan that provides only catastrophic coverage with a "very high deductible" and no subsidy.

Let's consider a basic example. A 45-year-old Floyd Countian named John Smith earns $36,000 a year, which means he is eligible to buy subsidized insurance through Kynect.

The individual market in Floyd County is limited to two companies, Anthem Blue Cross and the non-profit Kentucky Health Cooperative; Humana Inc. isn't offering individual coverage there. Depending on the type of plan John chooses, his premiums will range from $182 (bronze) to $421 (platinum), with deductibles ranging from $6,300 (bronze) to $500 (platinum).

Kynect shows selected plans' ranges of premiums, 
deductibles and out-of-pocket limts.

John has several options. Let's say he decides that he needs to keep his premium payments below $250 per month because he just bought a house and is on a tight budget. He doesn't expect to have many doctor visits because he's pretty healthy, but he doesn't have enough money saved to afford a $6,300 deductible if things went south.

Considering his obligations, John decides to set aside 15 percent of his monthly income for health care. Based on this budget, he narrows his options down to three plans. The Kynect website displays them.

After eliminating the gold plan, John decides he would prefer to pay an additional $40 per month to reduce his deductible to $2,000, so he purchases the cooperative's PPO Silver plan. About 7 percent of his income each month will go toward the premium. He will save the other 8 percent ($240) to apply to his deductible, prescription drug costs and co-pays for office visits.

A $2,000 deductible means that John must pay all of his medical costs, excluding certain preventive services like immunizations and screening, until he reaches this threshold. Co-payments and premiums cannot count toward the deductible.

John really likes his family doctor, whom he's been seeing for 20 years, and the doctor is in the cooperative's network. This plan has a $30 co-pay for primary care and mental health services, and he feels comfortable paying this amount for an office visit. If he were to see an out-of-network doctor, he would pay co-insurance: 60 percent of the doctor's full charge for the visit. For prescription drugs, there is a $500 deductible, and John will pay $20 per prescription for generic drugs after reaching this amount.

John has peace of mind knowing that he's covered if he were to have an accident. The total amount he may have to pay each year is his out-of-pocket limit of $6,350, and since he has purchased this plan during the enrollment period, he will not face a penalty for not having coverage.

As he navigates the site, John sees that he qualifies for a payment assistance in the form of a tax credit that will either reduce the amount John will pay in taxes or increase his refund, depending on his personal situation; or it will reduce his monthly premiums, if he so chooses.

What happens if I don't get covered?

The penalty for 2014 will be the larger of either $95 per adult and $47.50 per child under 18, up to a total of $285 per family or 1 percent of household income in excess of $10,000 for an individual or $20,000 for a family.

For example, let's say an individual making $40,000 per year doesn't buy health insurance in 2013. This person would would pay 1 percent of $30,000, or $300, in 2014. What about a family with a $50,000 household income? It would pay a penalty of 1 percent of $50,000, or $500.

The initial penalties are much less than the cost of health insurance, but will go up each year. The minimum penalty may increase to as much as $695 per person by 2016.

What if I'm on Medicare or Medicaid?

Almost nothing will change if you have coverage through Medicaid, but there are some changes for Medicare beneficiaries. The law doesn't require Medicare beneficiaries to buy more insurance and won't force beneficiaries to see different doctors, reports Andrea Adleman of U.S. News.

Obamacare does, however, increase premiums or prescription-drug costs for some Medicare beneficiaries, and it mandates $716 billion in Medicare payment reductions over the next 10 years. These cuts are made by changing payment formulas for hospitals, nursing homes, home-health agencies, hospice agencies and Medicare Advantage plans, says the Congressional Budget Office.

The law already affects higher-income Medicare beneficiaries. Those who earn more than $85,000 ($170,000 for a couple) are paying higher Part B premiums, which cover physician and outpatient services, and for Part D, which covers prescription drugs, says Kaiser Health News. As a result of this sliding scale, about 5 percent of Medicare beneficiaries are paying more for premiums and prescription drugs.

It is projected that by 2019, 7.8 million beneficiaries will be paying the higher Part B premiums and of that group, 4.2 million will pay the higher Part D premiums. Kaiser estimated the combined premium in 2019 would be $299 to $683 a month, depending on income.

However, typical Medicare beneficiaries, those below the $85,000/$170,000 income threshold, will pay less for their premiums since the the law closes the "doughnut hole," the coverage gap in prescription benefits, by 2020. The National Council on Aging estimates the savings could reach $1,800 for some beneficiaries.

Also, both Medicaid and Medicare beneficiaries will qualify for more free preventive care, such as a yearly wellness visit, vaccinations and colorectal screenings, starting Jan. 1.

What if my employer covers me?

About 57 percent of Americans have health insurance through an employer with fewer than 200 employees, and those who are covered do not have to purchase a new plan on Kynect. If your employer’s plan covers less than 60 percent of allowed medical expenses, or costs you more than 9.5 percent of your household income, you can shop on the exchange.

Over the past 10 years, employers have been shifting more health costs to employees. Worker contributions increased 89 percent during the decade, and are 14 percent higher than in 2009, Kaiser Health News reports. So, while the nature of your work plan may be changing, this is not a direct result of the health law.

If you aren't covered by your employer or if your employer decides to drop your coverage, you must obtain coverage or face a penalty. Religious conscience and hardship exemptions to this mandated coverage exist, and you will need to complete an application to request such an exemption.

What if I'm an employer?

Steve Wilson, senior vice president of Benefit Insurance Marketing in Lexington, said in an email that employers with fewer than 50 employees are facing 2014 premium increases that may lead them to drop coverage for their employees.

Wilson said unless companies act quickly to renew early based on 2013 underwriting rules, the average 2014 renewal for his company's small business clients will increase 63 percent. He said his clients represent a broad range of industries that will, on average, pay $3,508 more per employee for coverage next year.

On the other hand, a study by the RAND Corp. says Obamacare could alleviate some of the difficulties for small employers by putting their employees into a single risk pool. The study predicts that the number of workers offered coverage will increase after the reform, mainly because more small businesses will offer coverage.

If you have a small business with 25 or fewer employees, there may be significant tax credits available through Kynect to help cover the cost of insurance.

Kentucky Health News is an independent news service of the Institute for Rural Journalism and Community Issues, based in the School of Journalism and Telecommunications at the University of Kentucky, with support from the Foundation for a Healthy Kentucky.

Beshear says his managed-care plan is saving money and improving health outcomes; state points finger at hospitals

Six months ago, Gov. Steve Beshear applied an intensive plan to solve Medicaid managed-care implementation issues. On Thursday, he said the system is working more effectively for both providers and managed care organizations. He also said hospitals' complaints were overstated and some of them need to adapt to the new system, which will be two years old Nov. 1.

Gov. Steve Beshear

"There will still be a few—be they hospital or individual medical providers—who will say the program doesn't work, but it's tough to refute the facts," Beshear said at a news conference and in a press release. All but three states use managed care to save money and improve health.

Beshear asked each managed-care organization (MCO) to meet with every hospital in their networks to look over their accounts receivable to resolve billing disputes. "The final analysis—the MCOs and hospitals agreed that what was actually disputed and owed was a tiny fraction—just 2 percent of the original $346.6 million claim," the release says in boldface type.

The Kentucky Hospital Association said in a news release Friday, "The overwhelming majority of hospitals still report significant dollar amounts owed to them by the MCOs in unpaid claims. . . . While hospitals have seen a slight improvement in current claims processing and a slight decline in overall accounts receivables since the Governor issued his directive to the MCOs to clean up these claims, the amount of unpaid claims actually owed to hospitals (not billed amounts) is 60 to 70 percent higher compared to unpaid bills in October 2011 before managed care was implemented."

Beshear ordered that complaints about MCOs' payments be handled by the Department of Insurance instead of the Department for Medicaid Services. He said it has closed or nearly closed two-thirds of the 1,935 complaints it received. "Most complaints were related not to prompt pa y— which is what hospitals alleged — but instead related to claim denials, prior authorization disputes or unsatisfactory settlement offers," the release says.

The Insurance Department said MCOs often failed to offer a good explanation for denying claims. The Medicaid agency "sent corrective action plans to Coventry and Wellcare," the two MCOs operating outside the Louisville region. They will report progress each quarterly.

In general, the reviews didn't find that MCOs were holding payments on a regular basis, but concluded that Coventry Cares did not follow the state law requiring prompt payment if insurance claims. The Insurance Department has proposed that the company pay a civil penalty of $9,000.

Managed care has reduced "unnecessary ER use and inpatient hospital days in favor of more consistent disease management and prevention," Audrey Tayse Haynes, secretary of the Cabinet for Health and Family Services, said in the release. Kentucky has many people who go to the ER 10 times or more in a year, contributing to total ER expenses of $340 million for Medicaid. Unfortunately, Haynes said, some hospitals have used ERs to create revenue to support operations, "even advertising the average wait time in their ERs on their websites. For some communities, the ER has been the de facto primary care center." Haynes said hospitals have to put together a new business model that "dovetails with the goal of preventive care and wellness instead of high-cost emergency treatment."

The hospital association said it supports the state's efforts to reduce ER abuse, but "That project does not and will not solve the ongoing problem of WellCare and Coventry continuing to pay hospitals only $50 for emergency room care by reclassifying, on average, 50 percent of all ER patients, as non-emergency — under criteria they refuse to share with hospitals."

The implementation of the managed health care plan has saved money and improved health care, Beshear said. Per-patient costs are below predicted amounts and new enrollment is the same or declining. In November 2011, budget analysts predicted that the state would save $1.3 billion in the next two years, and "to date, Kentucky is still on target to meet that savings amount," the release said.

Statistics about health show the improvements to the system. For example, there has been a 93 percent increase in consultations to stop smoking, a 33 percent increase in flu vaccines for children, huge increases in mammograms and screenings for heart problems, and a 17 percent decrease in amputations (often because of untreated diabetes), and nearly an 11 percent decrease in CT scans.

Physicians say they dislike regulations on use of electronic health records, but they don't want to go back to paper records

Doctors say use of electronic health records is one factor contributing to physician dissatisfaction because it interferes with patient care, says a new study.

Surveyed physicians blame EHRs for reduced quality of care, saying that their daily interaction with "clunky" EHR systems contributes to their dissatisfaction, which is closely linked with their ability to provide quality care, reports Chris Kaiser of MedPage Today. The results were published in a study by the RAND Corp. and commissioned by the American Medical Association.

Physicians said the cumulative burden of rules and regulations affecting clinical practice, including “meaningful-use” rules for EHRs, also detracted from professional satisfaction, says the report brief. These rules were created by the federal Centers for Medicare & Medicaid Services; providers must certify that they are “meaningfully using” their EHRs by meeting established thresholds in order to qualify for the program's financial incentives. If providers accepting Medicare do not qualify by 2015, their Medicare payments will be reduced by 1 percent each year, says HealthIT.gov.

Despite their dissatisfaction with the regulations, physicians said they approved of the concept of EHRs, saying that their use has numerous benefits, including being able to remotely access patient information and improving in-practice communication, says the report. Only 20 percent of physicians said that practices should return to paper documentation.

“Physicians believe in the benefits of electronic health records, and most do not want to go back to paper charts,” said Dr. Mark Friedberg, a natural scientist at the RAND Corporation, in a news release. “But at the same time, they report that electronic systems are deeply problematic in several ways. Physicians are frustrated by systems that force them to do clerical work or distract them from paying close attention to their patients.”

The problem is that many EHR programs aren't user-friendly. This problem should be addressed, says the report, to ease physician workflow and free up time for the physician to spend with the patient. Here are some of the complaints physicians had about EHRs:

Time-consuming data entry 

User interfaces that do not match clinical workflow 

Interference with face-to-face patient care 

Information overload 

Lack of health information exchange between EHRs 

EHRs are expensive, threatening practice finances

Understanding physicians' professional satisfaction is important because better patient care is a potential "downstream" benefit of satisfaction. The researchers said knowing reasons for dissatisfaction can lead to targeted interventions to address the issues,says the news release.

"Aside from viewing better patient care as a potential consequence of better physician professional satisfaction, it may be useful to think of physician dissatisfaction, when it is caused by perceived quality problems, as an indicator of potential delivery system dysfunction," says the report.

Smokers shouldn't get Medicaid or Medicare, says freshman Republican lawmaker who grows tobacco

State Rep. Jonathan Shell of Lancaster, a young Republican who grows tobacco, is against a statewide smoking ban. No surprise there, but how about this: He also says people who use tobacco should't be able to get Medicaid benefits.

“As I don’t think we have should have a smoking ban, I also think if you’re going to be smoking, you should have to sign a waiver that you will not get onto Medicaid or Medicare ... so the taxpayers [don't] have to end up forking over those dollars because you made the wrong decision to smoke and put those carcinogens into your body,” Shell told Ryan Alessi on cn|2's "Pure Politics."

Shell, who is in his first term in the House, sponsored legislation this year to require drug testing for anyone who applies for government benefits such as Medicaid or food stamps, which he said "should be a last resort." His predecessor, Republican Lonnie Napier of Lancaster, was a leading advocate of such legislation.

Most of Alessi's five-and-a-half minute interview with Shell dealt with the workings of the tobacco industry. He said the free market will determine when he switches from growing tobacco to another crop, and he is already raising vegetables and flowers. He said his free-market and indiviphilosophy makes him oppose a smoking ban.

Here are tools and resources to help you understand how the health reform law impacts you, your family and your business

By Molly Burchett
Kentucky Health News

The rollout of the insurance-buying section of the Patient Protection Affordable Care Act started Oct. 1, and regardless of where you stand on the law, it's important to be informed about what will happen Jan. 1 when the law's major provisions are set to go into effect. To help you understand how the health law impacts you, your family or your business, the Foundation for a Healthy Kentucky has compiled a list of links to information about the health law.

The law, informally known as Obamacare, is a set of health care reforms signed into law by President Obama on March 23, 2010. The law includes insurance mandates and requires everyone to have health insurance or pay a penalty starting Jan. 1.  In addition to insurance mandates, both the establishment of online health-insurance exchanges and expansion of Medicaid are two essential elements of the law.

In June 2012, the Supreme Court upheld the health law in a 5-4 vote, saying its requirement that most Americans obtain insurance or pay a penalty was authorized by Congress’s power to levy taxes. The Internal Revenue Service will administer that provision of the law. The court ruling limited the law’s blanket expansion of Medicaid, which attempted to require all states to expand the program in order to receive federal funding, saying that each state could make its own decision.

The Kentucky Health Benefit Exchange, Kynect, was established in July 2012 and opened for enrollment Tuesday. Calling it “the single-most important decision in our lifetime for improving the health of Kentuckians,” Gov. Steve Beshear announced his decision to expand Medicaid in Kentucky in May. As a result of this decision, Medicaid has expanded to provide coverage to Kentuckians under 65 in households up to 138 percent of the federal poverty level—currently $15,856 for an individual or $32,499 for a family of four.

About 640,000 Kentuckians are uninsured, and 308,000 of them qualify for expanded Medicaid because their incomes are less than 138 percent of the federal poverty threshold. The remaining 332,000 Kentuckians must purchase private insurance through Kynect. Of those purchasing private plans, an estimated 83 percent will be eligible for at least some tax credit to do so, reports Kentucky Voices for Health, a group of health-reform advocates.

Currently, the federal government pays 71 percent of Medicaid costs, and the state covers 29 percent of the costs. Under Medicaid expansion, the federal government will cover 100 percent of the costs of the newly eligible people for the first three years. Starting in 2017, the federal government will cover 95 percent of the costs for this expanded population, and federal funding will phase down to 90 percent by 2020.

The Kentucky Voices for Health presentation, found here, gives more details about the overall purpose of the Affordable Care Act and its implementation in Kentucky. Get Covered Kentucky, a coalition spearheaded by Kentucky Voices for Health, compiled additional information about Medicaid expansion. Click here for these tools and resources.

Beshear says Medicaid expansion is the right choice for Kentucky, providing numerous reasons and county-level data to explain why not expanding the program would hurt both Kentucky’s health, which already ranks poorly in many health categories, and taxpayers’ bottom line. Click here to see the impact of health reform on your local community.

You may be eligible for coverage through Medicaid or tax subsidies to help you purchase private insurance. Go the the Kynect website to determine your eligibility for Medicaid coverage or private insurance subsidies and to enroll Medicaid, the Kentucky Children’s Health Insurance Program or private plans. "It’s easy to apply, with just one application to fill out. When you apply online, you get enrolled quickly. We also have insurance agents and Kynectors who will help you apply using computers," says the website. If you want to apply by mail or fax, click here for paper applications.

The law does not require small employers (businesses with 50 or fewer employees) to provide insurance coverage. If you own a small business with 25 or fewer employees, there may be significant tax credits available through Kynect to help cover the cost of insurance. Since the mandate to cover employees has been delayed for a year, businesses with more than 50 employees will not face penalties in 2014 for not providing health insurance, but they may face penalties starting in 2015.

The foundation resource page includes additional resources to help you understand health reform efforts at the federal level, including those from the Kaiser Family Foundation, which includes a subsidy calculator, the Robert Wood Johnson Foundation and a fact page from the U.S. Department of Health and Human Services. In addition, a foundation report outlines how the health law creates opportunities to address public health issues, decrease health disparities and reform care delivery.