Medicare: The Perpetual Balance Between Performance and Preservation0

This article was first published in the Journal of Contemporary Health law & Policy on August 1, 2014.

iStock_000039923254Medium“Confusion is a word we have invented for an order which is not understood.” — Henry Miller, Tropic of Capricorn

Passed by Congress and signed by President Lyndon Johnson into law in 1965, Medicare has weathered storms from all directions, growing to be the preeminent standard for health insurance in the United States.  The idea of losing Medicare as a vital public benefit still remains the single greatest fear with which each passing generation of Americans must contend, and yet, these challenges over the past fifty years, designed to fortify Medicare’s foundation and ensure its longevity, continue to take a toll on the program.

The most recent climate of reform includes changes implemented by the Patient Protection and Affordable Care Act (“PPACA”).  The PPACA is designed to expand coverage for a broader group of people, yet it adds unprecedented layers of complexity such that it may be but a matter of time before the confusion experienced by today’s providers proves to be Medicare’s undoing altogether.  The decades of trial and error upon which health care in the United States have been built, at least from the point of view of both physicians and lawmakers who watch from the sidelines, may give way to confusion and disruption industry-wide as a result of newly enacted regulations.

Today, Medicare is the preeminent standard for health insurance in the United States, expanding despite fluctuations in the economic, political and social climate since its initial passage.  However, in its struggle toward sustainability, the Medicare Program must understand the resulting consequences as it distances itself further and further from its original simplicity in 1965.

Medicare’s original cost-based system gave way in the 1980s to the Prospective Payment System (“PPS”), an event noted by many with great concern.  Under PPACA, the Medicare system takes another monumental step as it incorporates elements of performance into the PPS.  Formulaic and confusing, Medicare’s recent approach to provider reimbursement has been likened to Finnegan’s Wake by James Joyce, a book that some critics warn requires “skeleton keys” to understand.  In many ways, the need for hospitals and physicians to understand these performance-based measures may seem less important when fear of Medicare insolvency looms in the distance,13 especially as it relates to Medicare Part A (hospital insurance benefits for inpatient services) and Medicare Part B (supplemental insurance for outpatient services, among other things).  Irrespective of the fleeting grasp providers may have over PPACA’s new Medicare system, hospitals and physicians alike are mindful that the PPS as they once knew it is gone, replaced in part with the beginnings of a performance-based Medicare in which they may lose precious revenue, one percentage point at a time.

The entire article can be viewed here.

Lessons Learned from Dial-Up0

This article was first published in the Daily Journal on May 15, 2014.

iStock_000013044243MediumIn the largest cities across the U.S., locating an Internet connection has become as easy as finding a cup of coffee. In modern times, however, the ability to effectively communicate in business is inextricably connected to the rate by which one is able to transfer data. Like a bad cup of coffee, we may tolerate a slow connection when options are limited, but no one really enjoys it. Lessons from both support the notion that we not only prefer quality speed, but it also improves our performance at work.

If bit rates are the standard measurement for telecommunications, hospital beds present the equivalent in health care. … Read more →

American Health Care’s Temporal Order0

(January 26, 2014) The world of contemporary health care is not based upon absolutes, but rather an ever-evolving system of beliefs influenced at any given time by a confluence of advances in science, popular culture, current events and religion.  As these and other components shape that which we as a nation accept as truth, some historical notions transition away from their previously influential roles in society, to be replaced by ideologies that better conform to modern standards.  Given enough time and perspective, these erstwhile canons can even transcend into the realm of mythology and folklore. As with the idea that the mentally ill were once widely believed to be victims of demonic possession, what was once considered an immutable medical truth is now viewed as a quaint theory of an immature age.

Historically, the science of medicine presents a wealth of examples to show how fleeting truth can be, even within the context of life and death. … Read more →

The Beginning of Health Care Reform Nears Its End0

This article was first published in the Los Angeles Daily Journal on December 16, 2013.

iStock_000023873789SmallNow this is not the end. It is not even the beginning of the end. But it is, perhaps, the end of the beginning.” — Sir Winston Leonard Spencer Churchill

The countdown to 2014 has begun. In the days to come, millions of Americans will choreograph exactly where to be at midnight on New Year’s Eve, full of resolutions and expectations for the coming year. This January 1 holds a special significance for our country, as the dropping of that massive 11,875-pound ball in New York City’s Times Square represents what many have for four years hoped to be the heralding of an epic transformation in our nation’s health care. Though unable to predict the future as in fairy tales of old, the descent of that Waterford crystal ball marks the coming of age of the Affordable Care Act (ACA), still shrouded in controversy and fighting for a foothold on which to support itself. … Read more →

Roadblocks to Reform: The Influence of HIPAA and HITECH on the Affordable Care Act0

This article was first published at Michigan Business Professional Association on April 30, 2013.

When it comes to health care, our nation has reached a crossroads.  President Obama’s fledgling Affordable Care Act is a multifaceted, aggressive program designed to overhaul the delivery of health care by effectively restructuring its foundations from the inside out.  In doing so, it seeks to reduce the number of uninsured patients who have for so long been a burden to a struggling health care system that must provide medical care as a service while also turning a profit as a business.  But such a far-reaching plan has little chance of success if it is forced to evolve while fettered with the restrictions placed upon providers by certain grandfathered programs, most notably the Health Insurance Portability and Accountability Act (HIPAA) and the Health Information Technology for Economic and Clinical Health Act (HITECH).  As a result, we as a nation must now consider whether the ACA’s fundamental mission or patient privacy should rule the day. … Read more →

The Poor Get Poorer: The Fate of Distressed Hospitals Under the Affordable Care Act0

This article, written by Samuel R. Maizel and Craig Garner, first appeared at 2012 No. 12 Norton Bankr. L. Adviser 1 in December 2012. 

Synopsis

Distressed hospitals in America operate on small or non-existent profit margins.3 For many of those hospitals, the federal Medicare program and the individual States’ Medicaid programs are the largest payors. While the Patient Protection and Affordable Care Act of 2010 (the “Affordable Care Act”) was designed in part to increase the number of insured nationwide, the result of which should be positive for hospitals, any cause for celebration must first address the cost containment provisions in the Affordable Care Act that create new concerns for financially distressed hospitals. Included among the multitude of provisions in the Affordable Care Act are an immediate 1% cut in Medicare revenue, phased in reductions in disproportionate share payments to hospitals, future, permanent penalties of up to 1% of Medicare payments for hospitals which perform poorly under the Hospital Value Based Purchasing Program, and additional penalties for hospitals with unacceptable rates of re-admission or too many hospital acquired conditions rates.4 Together these cuts create a daunting challenge for the many financially distressed hospitals in America that simply lack the resources to establish an infrastructure designed to treat Medicare patients in this era of change.

Background

Medicare is the federal program that provides health care coverage to individuals aged 65 or older. Medicaid offers similar access for medical services on a state level for qualifying individuals, many of whom are poor. Medicaid covers 69 million people.5 By 2020, under the Affordable Care Act the number of Medicaid beneficiaries is likely to increase to 93 million.6 Combined, Medicare and Medicaid pay for more than half of the annual hospital bills in America. … Read more →

Health Care Reform: Walking the Fine Line Between Epic and Tragic0

This article was first published at California Healthcare News on January 8, 2013.

The recent changes to the core structure of modern American health care are nothing short of epic, rivaled in historic scale only by the introduction of Medicare in 1965. Although each decade over the past 50 years has in some way used government programs and incentives in an attempt to urge health care to undergo recalibration as a means to establish industry stability, by the end of the first decade of the 21st Century it had become evident that health care in the United States was fast becoming unsustainable as it existed. Enter health care reform.

Three years after the Federal Government passed the Affordable Care Act in an attempt to right the sinking ship, we the people are still waiting for the tide to turn. Having survived last summer’s monumental challenge before the United States Supreme Court and a presidential election in November, the Affordable Care Act has not only emerged as the law of the land, it has cemented its place as health care’s blueprint throughout America for decades to come. For California, however, the timing is unjust, as the perfect storm brought about by fiscal cliff/debt ceiling concerns heads straight for Sacramento from the east just as health care’s versions of Scylla and Charybdis approach forebodingly from both north and south. … Read more →

Winter Journal 20130

I am pleased to share with you a collection of my most recent writings on the Affordable Care Act, all of which can be accessed through this link: Click Here for the Winter Journal 2013

The recent changes to the core structure of modern American health care are nothing short of epic, rivaled in historic scale only by the introduction of Medicare in 1965.  Although each decade over the past 50 years has in some way used government programs and incentives in an attempt to urge health care to undergo recalibration as a means to establish industry stability, by the end of the first decade of the 21st Century it had become evident that health care in the United States was fast becoming unsustainable as it existed.

Having survived last summer’s monumental challenge before the United States Supreme Court and a presidential election in November, the Affordable Care Act has not only emerged as the law of the land, it has cemented its place as health care’s blueprint throughout America for decades to come. Unfortunately, the speed at which health care reform appears to move can at times be dizzying, and its demands are often draconian at first glance.

History has shown that health care in the United States is resilient, and often finds ways to surprise even its toughest critics. Though it is too soon to predict the future of health care in the United States, the value of historical information pertaining to the evolution of our health care system should not be discounted.  Only through the combination of historical perspective and modern-day analysis have I been able to understand the essence of the Affordable Care Act.

It is my hope that the following articles will provide the reader with similar guidance.

Very truly yours,

Craig B. Garner