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					                                                                                                                June 10, 2005



The
NEWSSTAND
        i t e m s              o f       i n t e r e s t                f r o m        t h e         m e d i a

                                                                                         Modern Healthcare – June 6, 2005

                                  Hatch hunts for hospitals
By Melanie Evans
Three times in as many months,             Whether other states follow suit            insurance. The hospitals and clinics
Minnesota's Attorney General Mike          remains to be seen.                         also agreed to adopt a zero-
Hatch and state hospital executives                                                    tolerance policy for abusive debt-
have heralded deals to end one of          "The rest of the country is going to        collection practices and not to sue
the most divisive practices in             follow," Hatch said. "It has to."           for payment before first making
healthcare: billing uninsured                                                          sure patients owe money and their
patients more for care than those          Hatch has long been an aggressive           insurers have been billed, if
with medical benefits.                     watchdog of Minnesota's healthcare          appropriate. An estimated 400,000
The latest agreements, announced           industry. His audits of                     Minnesota residents are uninsured.
last week, included 35 hospitals that      Bloomington, Minn.-based
voluntarily signed two-year deals          HealthPartners; Allina,                     A single standard for all U.S.
with Hatch to give uninsured               Minneapolis, and its former health          hospitals may be difficult to draft,
patients at least the same discount        plan, Medica, criticized Minnesota          said Richard Scruggs, the Oxford,
as had been negotiated with each           not-for-profits for excessive               Miss., lawyer leading a consortium
hospital's largest insurer. In May, 16     spending on travel and                      of lawyers suing not-for-profit
hospitals with four Twin Cities            entertainment.                              hospitals over how and how much
health systems voluntarily signed                                                      they bill the uninsured. But no
identical agreements.                      Hospitals face mounting pressure            hospital should bill uninsured
                                           nationally to address aid for the           patients more than those with
A fifth health system, Fairview            uninsured. Congress and state               coverage, he said. Not-for-profits
Health Services, reached a separate        legislatures have launched inquiries.       receive a tax exemption to provide
deal announced April 1 that covers         Lawyers have sued not-for-profits,          care to the underserved.
six hospitals, after being the subject     alleging that unfair billing and
of a 15-month inquiry by Hatch             aggressive collection practices             "There's no justification for a
(For a complete list of participating      violate their tax-exempt status.            penalty for being poor and
hospitals, click here. To date,            Minnesota hospitals have addressed          uninsured," Scruggs said, nor will it
roughly 75% of Minnesota hospital          the problem head- on, Hatch said,           hurt them financially to change.
admissions are covered by such             and others can, too.                        "That's not where any hospital, big
agreements, which also lay out                                                         or small, rich or poor, makes any
standards for debt-collection              "It's the right thing to do," he said.      money."
policies.                                  "If it's the right thing to do that the
                                           uninsured should pay the market             Terence Pladson, president and
Expect more hospitals in the state to      rate, then do it. If it's the right thing   chief executive officer of
follow, said Hatch and Minnesota           to do to set standards for                  CentraCare Health System, is also a
Hospital Association President             collections, then do it."                   member of the St. Paul-based
Bruce Rueben. "We believe other                                                        Minnesota Hospital Association's
hospitals will sign on because it's        Under the agreements, patients with         board of directors, which worked
become an industrywide standard in         annual household incomes of                 with Hatch to draft the billing and
Minnesota," Hatch said. In many            $125,000 or less will be charged no         collection agreements. CentraCare,
cases, hospital executives must wait       more than the amount paid by each           St. Cloud, which owns three central
for trustees or directors to meet and      hospital's largest insurer according        Minnesota hospitals, promised to
approve the deal before signing on,        to revenue. The terms apply to              adopt the standards, which modified
Rueben said.                               patients without insurance and to           similar discount and collection
                                           medical care not covered by
                                                           2


policies adopted by its board within     to hospitals, which seek to make up    Unlike other agreements, Fairview's
the last year.                           lost revenue by spreading costs to     deal requires that a third-party
                                         other patients. Insurers negotiate     reviewer must agree the health
"We saw this as a positive response      discounts for enrollees, leaving the   system has complied with all
to a major public challenge,"            uninsured bearing the brunt of a       necessary safeguards before suing a
Pladson said. Hospitals sought a         broken system, he said.                patient for payment.
voluntary agreement to avert more
stringent state legislation or costly,   Mark Rukavina, director of the         David Page, Fairview's president
time-consuming investigations by         Access Project, Boston, praised the    and CEO, said Hatch's inquiries into
Hatch.                                   deal and said it appears more          Fairview highlighted unrecognized
                                         comprehensive than legislative         problems faced by Minnesota's
"Hospitals elsewhere face a similar      efforts elsewhere, such as in          uninsured. "We have an activist
choice," he said. "I would urge          Connecticut and California, where      attorney general who is interested in
other states to look to proactively      laws address patients' access to       and understands the healthcare
enact similar measures or discuss        information or what fees and           industry," Page said.
them with their hospital associations    interest hospitals can charge. "This
before Congress takes action."           is a new development," he said.        For Fairview, Hatch's audit
                                                                                provided uncomfortable but
"It's a great example," said Nancy       Alicia Mitchell, spokeswoman for       important lessons. "We had to get
Kane, a professor of health policy       the American Hospital Association,     past the criticism and look at
and management at Harvard                said the trade group applauds the      ourselves in the mirror," he said,
University's School of Public            Minnesota agreements. The AHA          “and ask, `Are we proud of all the
Health. Kane testified at a U.S.         encourages hospitals to develop        things we're doing?' "
House Ways and Means Committee           local solutions to billing and
hearing on not-for-profit hospitals      collection issues, she said.           The answer was no. Now, as
that too few of them provide enough                                             Fairview adopts changes, the health
financial aid for needy patients to      One agreement -- the one between       system must do more than follow
justify their tax-exempt benefits.       Hatch and Minneapolis-based            the letter of the law and be fully
Before Congress, Kane called for         Fairview -- differs from the rest,     responsible for its policies. When an
stronger standards to be required for    which were voluntary. Hatch            error occurs, "we've got to err on the
hospitals that are granted tax-          concluded a 15-month inquiry into      side of the uninsured," Page said.
exempt status, including discounted      Fairview by releasing a damning
rates for the uninsured and less         five-volume report on the health       Jim Abelsen, senior vice president
aggressive collection practices.         system's collection and billing        and general counsel for St. Mary's
"That's where Minnesota is headed,"      practices.                             Duluth (Minn.) Clinic Health
she said.                                                                       System, said Fairview's experience
                                         No other Minnesota health systems      raised awareness among Minnesota
Minnesota's history as a progressive     were subject to an inquiry.            hospitals that uninsured patients
state, with a commitment to public       However, four systems that             paid an unfair price for medical
health and no investor-owned             announced deals with Hatch in early    care.
hospitals, made it easier for such an    May -- Allina Hospitals & Clinics,
agreement to flourish, Kane said.        Minneapolis; HealthEast Care           "I think you need to give credit to
"Hopefully, more states will see it      System, St. Paul; North Memorial       the attorney general for recognizing
as something to emulate," she said.      Health Care, Robbinsdale; and Park     a problem, and you need to give
                                         Nicollet Health Services, St. Louis    credit to Fairview for
"Of course, that's for other states to   Park -- received requests for          acknowledging it," Abelsen said. As
answer," said the MHA's Rueben. "I       information about billing and          more Minnesota hospitals adopt the
think what we're doing is the right      collection practices from Hatch.       standards, it sends a message to the
thing for Minnesota."                                                           state's residents that the healthcare
                                         Fairview's low-income patients         system is responsive to their needs.
The deal won't solve the wider           faced harassing collectors, even       "There is a value in acknowledging
problem of access to affordable          after agreeing to payment plans.       a problem and agreeing to live by
healthcare, he said. "What led us to     Fairview garnished wages that          standards and then letting the public
this point is a flawed financing         should have been exempt from such      know they'll be accountable," he
system," Rueben said. Government         action and pursued payment from        said.
insurers deeply discount payments        those who did not owe money.
                                                               3

                                                                                           Des Moines Register – June 4, 2005

                         Don't mix two issues of income,
                               hospitals' tax status
By Jack Dusenbery
A May 30 Register editorial took issue with the publicly           the cost of supplies, staff, overhead and the allocation of
reported earnings of several physicians based at Covenant          the cost of caring for the uninsured among the insured.
Medical Center in Waterloo. The issue at hand has been
inappropriately intertwined with the tax-exempt status of          Tax-exempt status allows hospitals like Covenant Medical
hospitals.                                                         Center to ensure that a full array of high-quality services is
                                                                   available to all who seek them. While "for-profit"
First, on physician compensation: Certainly the numbers            competitors cry foul, they open surgery centers and add
are attention-grabbing. Underreported and certainly                imaging facilities to siphon out business they carefully
underappreciated are the underlying numbers from which             select, leaving to hospitals the care for the uninsured and
that compensation was calculated - statistics that speak to        the responsibility for unprofitable business lines, like many
how hard each of these physicians works.                           emergency rooms and obstetric programs.

The Register was provided with data on these physicians'           Tax-exempt status helps institutions run patient-care
so-called relative value unit, which showed, related to            services that, if left to profit-and-loss decisions, might not
national data, that the amount of care delivered is in the         be made available locally. The status allows systems like
top 1 percent nationally. Their work generated payment,            Covenant to reinvest in the community and our charitable
primarily from insurers, that, minus business expenses,            mission by providing clinics in rural Iowa - Jessup and
became income to the physician. They are not paid a                Oelwein, Gladbrook and Hudson. Tax-exempt status
salary; they were paid what they earn by seeing patients.          creates modern facilities and high-quality care in places
                                                                   where it is needed - our hometowns.
The level of work, not the corresponding compensation,
points more to the real problem - a shortage of specialty          Current movements to review the rules and status of tax-
physicians in rural health-care markets. It is not executive       exempt health-care providers are important and
compensation; it was earned by responding to patient               worthwhile. We support efforts to ensure that health-care
needs every day of the week, regardless of the hour.               dollars are spent taking care of people in need, not paying
                                                                   salaries to those who in their daily work might never see a
It demonstrates what is still right about health care -            patient.
dedication to serving those in need. We believe their hard
work and dedication is commendable, not condemnable.               We fear that recent stories have confused the issues of how
                                                                   much physicians can earn seeing patients and the
Second, on the issue of tax exemption: These physicians            worthiness of the tax exemption their home-base hospital
did not benefit from this hospital's status. They were paid        receives. It would be bad public policy to continue the
the same for the work performed as their colleagues in             confusion and send a message that taking care of patients
other local health systems or in stand-alone practice for          when and where needed is wrong.
similar activity during the same time period.
                                                                   We all need to be part of the debate to make sure that,
Paying people not providing patient care an excessive              from access, to privacy, to care for the uninsured, to the
salary is far different from paying a physician what his or        high cost of care, we make decisions that put patients first.
her personal patient-care activity, minus business
expenses, generated.                                               JACK DUSENBERY is president and chief executive
                                                                   officer of Covenant Health System.
Doctors seeing patients is not what drives up the cost of
care, as your editorial suggests. The true accelerants are
                                                                 4

                                                                                                 Washington Post – June 8, 2005

                         Free-Market Philosophy
                   Doesn't Always Work for Health Care
By Steven Pearlstein
As the head of Medicare and Medicaid, Mark McClellan                 profit they need to operate unprofitable departments such
may be the most powerful man anywhere, in control of                 as burn units and emergency rooms 24/7.
about 7 percent of the U.S. economy. And today was to be
the deadline for him to rule on one of the most heavily              In truth, the arguments tend to jumble different issues that
lobbied issues of the past year: whether to lift an 18-month         need to be pulled apart.
moratorium on creating new physician-owned specialty
hospitals.                                                           While specialized, high-volume units are probably a better
                                                                     way to provide some health services, they don't need to be
It's all very technical and bureaucratic, to be sure. But in         owned by physicians. There are plenty of other sources of
deciding the issue, McClellan is being asked to choose               investment capital. And the experience with doctor-owned
between two competing and fundamentally irreconcilable               labs and MRI machines suggests that physician ownership
models for the U.S. health care system.                              of surgical hospitals will inflate total health care spending
                                                                     by increasing the number of unnecessary operations.
One model would rely even more on competition among
self-interested providers for the business of increasingly           At the same time, community hospitals are probably right
empowered consumers to restrain prices, assure quality               that specialty hospitals cream-skim the most profitable
and spur innovation. That, after all, is how it works in             business. But the larger question is why the system doesn't
nearly every other industry.                                         allow hospitals to price their services so that "hard" cases
                                                                     are just as profitable as "easy" ones and emergency rooms
The other model is based on the premise that competition             enjoy the same operating margins as cardiac units.
in health care will always be highly imperfect, and that too         Eliminating cross-subsidization within hospitals would
much competition will have socially unacceptable                     significantly reduce the amount of "cream" available for
consequences. This model envisions even more                         "skimming."
government regulation and stronger management by public
and private health plans.                                            McClellan hopes that by adjusting and refining Medicare
                                                                     reimbursement rates for different categories of services,
In a decision that seems only fitting for a Harvard-trained          and allowing general hospitals to offer "gains-sharing"
physician and MIT-trained economist, McClellan has                   payments to doctors that could substitute for ownership of
decided to kick the can down the road, extending the                 their departments, he can level the playing field enough to
moratorium until year-end.                                           diffuse the specialty hospital issue. Like many
                                                                     conservatives, he looks to specialty hospitals, consumer-
There are about 130 physician-owned specialty hospitals,             driven health savings accounts and new reimbursement
most of them focused on heart, orthopedic or other types of          schemes that pay doctors and hospitals for the quality
surgery. There is some evidence that by doing large                  rather than the quantity of care they provide to push the
numbers of the same kinds of operations, the tightly                 U.S. health care system toward the market model.
focused hospitals lower costs, improve medical outcomes
and deliver more patient satisfaction. And, in theory,               McClellan's crusade is likely to fail, however, if he doesn't
giving doctors a stake in the enterprise not only gives them         resolve a fundamental question about the proper role of
greater control over their professional lives, but also offers       doctors in the health care system.
extra incentive to innovate and improve service.
                                                                     When they are vilifying insurers and managed-care
General hospitals, by contrast, see the move toward                  companies, physicians like to present themselves as Dr.
specialty hospitals as nothing more than cream-skimming              Welby -- selfless professionals whose medical judgments
by self-dealing doctors that will put community hospitals            would never, ever be colored by their financial interests.
into an economic death spiral. They argue that doctors               But in lining up behind physician ownership of specialty
referring patients to hospitals they own is an unacceptable          hospitals, the doctors essentially acknowledge that they are
conflict of interest. And by siphoning off the most                  just like the rest of us, their behavior swayed by even
profitable patients in the most profitable parts of medicine,        modest financial incentives.
the specialists rob general hospitals of the scale, scope and
                                                                 5


You can't have it both ways. And the way the people                    For most Americans, providing health care ought to be
would have it is to pay their doctors well, put them in the            different from selling soap; they won't tolerate doctors
central decision-making role in the health care system --              acting like commissioned salesmen and investment
and then demand that they give up the right to invest in               bankers. And if that means having less market competition
MRI machines or specialty hospitals or get incentive                   and more regulation in the health care system, it seems to
payments from drug companies.                                          be a trade-off they're willing to make.

                                                                                               Wall Street Journal – June 7, 2005

  Cases, Fines Soar In Fraud Probes Of Drug Pricing
By John R. Wilke
Months before a new law kicks in               The recent surge in cases reflects            criminal investigations under way
that will dramatically escalate                increasing scrutiny of drug makers'           stands at 150 and involves nearly
government spending on drugs,                  pricing practices and a sharp rise in         500 drugs. "We've been focusing on
state and federal prosecutors are              federal and state prosecutions of             pharmaceuticals intensively over the
investigating 150 cases that involve           health-care fraud. Prescription drugs         past year, to coordinate the massive
alleged pricing fraud by some of the           represent an ever-larger share of the         number of cases with others in law
world's largest drug makers and                nation's health bill, and the federal         enforcement, the states and federal
could produce more than $1 billion             government is preparing for a huge            agencies," he said.
in criminal fines and civil penalties          increase in spending when the new
this year.                                     Medicare drug benefit goes into               The scope of the investigation and
                                               effect in January.                            the cooperation involved suggests
The cases are part of an expanding                                                           that what had appeared to be
industrywide investigation of drug             It will cover prescription drugs for          scattered moves in the past few
pricing that has produced scores of            the first time for more than 40               years has coalesced into a broad
lawsuits currently under seal in               million Americans and will cost an            concerted effort. State and federal
courts around the country. They are            estimated $720 billion in its first 10        fraud cases have already netted $2.4
focused on allegations that drug               years. With these huge increases on           billion from drug firms -- including
companies cheat state and federal              the way, Senate Finance Committee             Bayer Corp., Pfizer Inc. and
health-care programs by inflating              Chairman Charles Grassley, an                 Schering-Plough Corp. -- that were
prices, offering undisclosed rebates           Iowa Republican, has pressed the              alleged to have overcharged state or
to distributors or marketing drugs             Justice Department to step up fraud           federally backed health-care
for unapproved uses, according to              enforcement.                                  programs, according to an estimate
lawyers and officials involved in                                                            by Taxpayers Against Fraud, a
these cases.                                   While the criminal and civil                  nonprofit advocacy group. James
                                               penalties and settlements represent a         Moorman, the group's director, said
A half-dozen major drug makers                 small fraction of drug-company                the cases publicly acknowledged to
have already paid fines and                    profits, they are rising fast. Fines          date are "just the tip of the iceberg."
penalties to settle charges in the past        and penalties this year could amount
two years. At least three more --              to almost twice the totals paid in            "It's safe to say that we're
Serono Inc., Abbott Laboratories               each of the past three years, officials       investigating many more companies
Inc. and King Pharmaceuticals Inc. -           said.                                         than have been publicly identified,"
- are expected to face similar                                                               said Patrick O'Connell, a prosecutor
allegations and possible criminal              Peter Keisler, who oversees the               in the Texas attorney general's
fines or civil penalties this year.            Justice Department's civil-fraud              office. He wouldn't name
                                               unit, said that "the most frequent            companies under scrutiny. Nicholas
Prosecutors also could force these             defendant in fraud cases today is in          Messuri, an assistant attorney
companies to accept "corporate                 health care" and that the industry            general in Massachusetts, said this
integrity agreements" that include             now accounts for "the lion's share of         year "already looks like a record-
tough federal oversight of the way             fraud, both in number of cases and            breaking year" for health-care fraud
the companies price and market                 dollar amounts -- and those numbers           cases.
drugs under government-paid                    are going up."
health-care programs, including                                                              Serono, the U.S. unit of Swiss-
Medicaid and Medicare.                         Mr. Keisler wouldn't discuss                  based Serono SA, one of Europe's
                                               individual cases. But he said the             largest drug makers, has set aside
                                               number of separate civil and                  $725 million to cover possible
                                                            6


criminal fines and civil penalties.       taxpayers by falsely setting a high      defend ourselves against these
Serono says it is cooperating with        reimbursement rate, the suit said.       claims."
the inquiry, which it describes as        Under Medicaid rules, companies
"an ongoing, industrywide                 are generally required to give the       Much of the new wave of cases is
investigation by the states and           government the best price that they      being pursued under the False
federal government" into the setting      give to any purchaser of a drug.         Claims Act, signed into law by
of wholesale prices and other                                                      Abraham Lincoln to damp
commercial practices, and that            Since the California case was filed      profiteering in the war effort and
many other drug companies are also        in 2003, investigators have found an     during reconstruction. Under the
under scrutiny.                           alleged pattern of similar fraud         act, which was widened in 1986, the
                                          involving other drugs and other          government gets triple damages
King Pharmaceuticals, of Bristol,         companies, lawyers briefed on the        when companies are found to have
Tenn., and Abbott, of Abbott Park,        case said. As a result of this new       bilked taxpayers.
Ill., also have said they are             information, a wider complaint
cooperating with investigators. King      against Abbott and other drug            Last year, Pfizer paid $430 million
has set aside $130 million for            companies is expected to be filed        to settle False Claims Act lawsuits
possible civil penalties and fines. A     within weeks, including new              involving marketing of its anti-
spokesman says the company hopes          charges covering other drugs and         seizure medication, Neurontin, for
to strike a "comprehensive                new defendants, and possibly new         unapproved uses after a sales
settlement" soon with the Justice         federal charges, lawyers briefed on      executive blew the whistle on the
Department and other regulators to        the case said. Justice Department        practice. Schering-Plough settled
resolve all pricing claims.               officials declined to comment.           two False Claims Act cases for a
                                                                                   combined $372 million, for
Abbott faces pricing-fraud claims         In a statement, Abbott said the          allegedly reporting inflated prices
brought two years ago by                  California case "is "similar to others   for its Claritin antihistamine and
California's attorney general, based      filed against our industry." The         albuterol asthma inhalant. In 2003,
on alleged overcharges to                 company said it has "consistently        Bayer paid $257 million for
government-paid drug programs for         complied with all laws and               concealing pricing data; Bayer also
vancomycin, a powerful antibiotic.        regulations" and "properly and           paid $14 million for alleged
Abbott is alleged to have reported to     lawfully provided information as         overcharges in 2001, in one of the
the state Medi-Cal program an             required by the government and           first big cases that led investigators
average wholesale price of $55 a          requested by the independent drug-       to begin examining similar alleged
dose while charging pharmacies            price reporting services." The           pricing frauds by other major drug
only $6.29 a dose. The alleged            statement added, "We have a strong       makers, state and federal officials
scheme, apparently intended to help       defense and intend to vigorously         said.
the drug gain market share, cheated

                                                                                     Wall Street Journal – June 3, 2005

                    Health Effort Tackles Patients' Data
By Vanessa Fuhrmans
More than 50 major health insurers,       patient from any participating health    and what it covers. In many cases,
medical associations, hospitals and       plan, possibly by early next year,       staffers spend hours on the phone
technology companies have joined          group participants say.                  with managed-care companies or
in an effort to resolve a daily hassle                                             logging on to dozens of differently
that contributes to health-care costs:    Once information-exchange                formatted health-plan Web sites.
the cumbersome process of                 standards are established, the group     The time and money spent on this
obtaining patients' health-insurance      expects technology companies that        administrative chore have grown
information.                              specialize in administrative software    with the multiplying variations on
                                          for doctors will create systems to       co-payments and deductibles. Soon,
The effort could lead to an initial set   extract patient eligibility from the     the growth of consumer-driven
of information-exchange rules this        various health plans.                    health plans will bring even more
fall. These would allow medical                                                    complexity to the task.
providers, using an electronic            Today, medical practices have no
system of their choice, to obtain         single, easy way of checking             Physician practices containing 10
coverage information for any              whether a patient has a health plan      physicians spend about $39,000
                                                           7


annually, on average, to verify         information-exchange rules allow           The Waltham, Mass., company
coverage eligibility, according to a    easy use of direct deposit or              athenahealth Inc., which sells such
survey conducted for the Medical        automated tellers regardless of            online systems to providers, says
Group Management Association,           where a person's home bank is              about 23% of claims denied by
while larger medical centers often      located.                                   insurers are because of incomplete
spend more than $1 million. Further                                                or incorrect eligibility information.
contributing to health-care costs are   "For that information transfer to          And according to CAQH, some
claims errors or denials due to         happen they have to talk in the same       medical groups estimate that up to
incorrect or sketchy information.       language and work under the same           50% of the bad debt they incur
                                        operating rules," Ms. Thomashauer          comes from inaccurate eligibility
To address that, a health-plan          said.                                      information.
alliance called the Council for
Affordable Quality Healthcare has       With the parameters set, software          The physician practices owned by
brought together the disparate group    companies would know what is               the University of Kansas Hospital in
to hammer out a set of interoperable    needed. "They've already said, if we       Kansas City see about 800 patients
rules for exchanging such health        can come up with the rules, the            a day. Often patients forget their
benefit and eligibility information.    marketplace will build this," said         insurance cards, or present cards
The group includes insurers such as     Carl Volpe, vice president of              that are out of date or don't detail
Aetna Inc. and Humana Inc., some        strategic initiatives for health-          what is actually covered. Patient
of the biggest Blue Cross and Blue      insurance titan WellPoint Inc.,            eligibility for government programs
Shield plans, Montefiore Medical        another participant in the initiative.     such as Medicaid can change
Center of New York, and the federal                                                monthly.
Centers for Medicare and Medicaid       Already, many larger practices and
Services. And the group continues       hospitals use automated software           "There's no way we can call every
to add participants.                    that verifies patients' eligibility with   health plan or look at every Web
                                        health-plan Web sites ahead of an          site," said Tammy Shepherd, chief
The idea isn't to create a central      appointment. But the information           financial officer of the Medical
database of information, said Robin     isn't consistent among the Web             Administrative Services of KU,
Thomashauer, CAQH's executive           sites, and usually doesn't explain         owned by the hospital.
director. Rather, the model is the      what co-payments or deductibles
banking industry, where                 are involved.

                                                                                     Los Angeles Times – June 6, 2005

                                 A mini price, a mini policy
By Daniel Costello
Connie Terwilliger, a 53-year-old       perhaps some prescription drugs but        get coverage or to help struggling
voice-over artist, has found a way to   that don't cover catastrophic              employees keep it.
cut her insurance premiums by more      illnesses or most hospital care.
than half.                                                                         California-based Jack in the Box
                                        For some healthy consumers, they           Inc. and Marie Callender's recently
By switching health plans, her          may be a good idea. But as the plans       started offering limited-benefit
monthly cost will drop from $300 to     become more popular, consumer              health plans to their employees,
$123. For that, she will get five       advocates warn that they may               joining companies such as Exxon
doctor visits a year, some lab tests    provide a false sense of security.         Mobil Corp., Home Depot Inc. and
— and strict limits on hospital care.   Without that ultimate protection,          Denny's Corp. Later this year, more
                                        they say, the plans might not always       than 20 national companies,
"I'm pretty healthy and in many         be worth the cost.                         including Intel Corp., IBM and
ways this plan is better for me at                                                 Sears, Roebuck & Co., are expected
half the price," the San Diego          The bare-bones policies, known as          to include limited health insurance
woman said.                             "limited-benefit" or "mini-medical"        in their coverage options as well.
                                        plans, have been popular for several
Like Terwilliger, more Americans        years with some small employers.           Critics of mini-medical insurance
are turning to low-cost health plans,   Now more companies are                     point out that most employers don't
some as cheap as $50 a month, that      embracing the leaner policies as a         contribute to the plans, as opposed
pay for routine doctor visits and       way to cajole uninsured workers to         to traditional plans in which
                                                           8


employers often pay 80% to 100%         that typical comprehensive plans do.       for doctor visits and prescription
of employee premiums.                   Most pay for routine medical care          drugs run about $20 to $50.
                                        such as doctor visits and offer some
And, they say, these policies won't     prescription drug coverage but             Because they have yearly coverage
much help workers who most need         typically cover only a tiny portion        ceilings, nearly anyone can qualify
it — those who end up in the            of major costs incurred by hospital        for them, even with preexisting
hospital facing huge unpaid medical     visits, operations or mental health        medical conditions. The plans are
bills. Research shows that up to half   services.                                  often the same price no matter the
of all bankruptcies today are related                                              policyholder's age, gender or area of
to medical costs.                       For instance, the plans may pay for        residence.
                                        several doctor visits a year,
Another concern, say benefit            immunizations for children and             Those buying the skimpiest
experts, is that if employees try to    $500 worth of yearly prescription          coverage will still qualify for
reapply for comprehensive coverage      drugs. But employees could be              "group" prices at hospitals rather
down the road, limited plans may        eligible for as little as $300 a year in   than the sticker price that uninsured
not be considered "credible             emergency room care — or enough            patients are often charged. That
coverage," and applicants could be      to last no more than a few minutes         means those who exceed a $1,000
denied for preexisting conditions       in most hospitals.                         yearly coverage limit could walk
just as if they had no insurance at                                                away with a hospital bill that is half
all.                                    The plans have strict coverage caps,       or even a third the size of the bill
                                        which may be as low as $1,000 a            they would have gotten if
"Let's say exactly what this is         year and are rarely higher than            uninsured.
about," said Lisa McGiffert, senior     $20,000. That means that no matter
policy analyst for Consumers            how high a medical bill is, the            Edelheit of United Group Programs
Union, a Washington, D.C.-based         insurer won't pay more than the            says a client who bought a mini-
consumer advocacy group.                yearly cap.                                medical plan last year and later had
"Medical coverage is getting more                                                  surgery saved thousands of dollars.
limited every day, and people are       Still, the growing popularity of the       Because she had bought a limited-
paying higher health premiums for       plans shows that they are filling a        benefit plan, the hospital charged
little in return."                      need.                                      her just $2,900 for the operation,
                                                                                   and her insurance carrier paid all
Others worry that broader adoption      "No one is going to say these are          but $900 of the bill.
of limited plans could skew the         better than full coverage, but it's a
notion of just what it means to have    step up for people who otherwise           Other than employers, some
health insurance or encourage more      wouldn't have insurance," said             associations, including AARP, are
employers already offering better       Jonathan S. Edelheit, president of         also marketing the limited health
benefits to move to the skimpier        United Group Programs, a national          plans as supplemental medical
plans.                                  insurance broker based in Florida.         insurance. In buying a second health
                                                                                   plan, some people could save
"People could say these folks are       Although a broad mix of employers          having to pay huge out-of-pocket
technically insured, but that doesn't   is starting to offer mini-medical          costs on their own.
mean much [with these plans].           plans, they are still primarily aimed
People would still be crippled if       at low-income and hourly workers           "These are an option for anyone
they get sick," said Jonathan Parker,   in industries that have high rates of      who can't afford to pay for group
national campaign director for          uninsured workers or employees             insurance," said Joann Parrino, vice
Americans for Health Care, a            who are spending large percentages         president of employee benefits at
national grass-roots organization       of their income to remain insured.         Bolton & Co., an employee benefits
that advocates for universal                                                       consulting company in Pasadena.
healthcare.                             The plans cost $50 to $100 a month         "That's a lot of people nowadays."
                                        for an individual and around $200 a
The limited plans keep costs down       month for families. Co-payments
by not offering the same benefits
                                                              9

                                                                                         Washington Post – June 5, 2005

                  A Movement to Bring Grief Back Home
By Rachel S. Cox
After Richard Saul died of Lou              the standard American practice of        funerals to the aging of the baby-
Gehrig's disease just before                handing the body over to a               boom generation, a phenomenon
Christmas last year at age 77,              mortician for embalming and              expected to keep the death rate
neighbors and friends gathered at           display before cremation or burial.      rising for decades.
his Cleveland Park home to extend
sympathies to his widow, Judy, and          Knox said that in her seven years as     "It's the other end of the spectrum
their sons and grandson. Many were          director of Crossings, a Silver          from natural childbirth," she said.
surprised to learn that they could          Spring nonprofit she founded to          "The baby-boom generation took
also pay their respects to Richard.         help others carry out home funerals,     control of critical life events, wrote
                                            she has assisted about 150 families.     their own wedding vows, had home
His body, washed and dressed in his         Others active in the movement            births. . . . They're fueling the
favorite clothes, lay in the master         report an increased interest in the      interest in taking control."
bedroom, cooled by dry ice and              practice, but the number of home
open windows, and surrounded by             funerals is minuscule considering        The funeral industry acknowledges
fresh flowers, burning candles,             the roughly 2.4 million annual           a growing public interest in more-
family photographs and mementos             deaths in the United States.             individualized funeral rites. "I think
of his many years as a lawyer, civil                                                 a home funeral is a wonderful way
servant and father of four. Like a          Like the hospice movement, which         to go," said Robert J. Biggins,
small number of other bereaved in           since the 1960s has helped the           president-elect of the National
the Washington area and nationally,         terminally ill die peacefully at         Funeral Directors Association.
Judy Saul chose to care for her             home, the home funeral movement          "What could be more personal? It
husband's body for several days at          aims to protect what it calls            signifies a family's desire to be
home.                                       individuals' "right" to care for their   actively involved in celebrating the
                                            own at death. At its most abstract,      life of the family member. Anything
Once the hospice nurse who came             promoters say, it hopes to dispel the    that we can do to help them do that
to certify the death had convinced          fear and denial that accompany an        is our mission."
the D.C. coroner's office that              institutionalized approach to death,
keeping the deceased at home was            and return life's final act to its       Yet home funeral advocates said
legal -- as it is in the District and all   historical position as a natural,        that at the state level, where laws
but five states (Connecticut,               profound and private event.              governing funerals are made, the
Delaware, Indiana, Nebraska and                                                      industry often has opposed the right
New York) -- Saul and a friend,             Despite the violent deaths that          of individuals to care for their dead.
Sally Craig, had prepared her               crowd movie and TV screens and           "Right after my first book came out,
husband's body with the assistance          newspapers, in our culture "we           the state of Rhode Island changed
of Beth Knox, a "funeral rites"             never see actual death," said Joshua     the statutory language to make it
educator whom Saul had met two              Slocum, the director of the Funeral      more difficult," Carlson said. Her
months before.                              Consumers Alliance, a national           book came out in 1987. Recently,
                                            group that advocates for consumer        the Texas legislature debated an
"I got to know people on a really           protection in funeral affairs. "The      amendment supported by the Texas
personal basis because we had time          institutionalization of illness and      Funeral Directors Association that
and we were home," Saul said.               death has made us inordinately           would have made it illegal for
After three days of grieving, she felt      terrified."                              families to contract directly with
ready to part with her husband's                                                     crematories, meaning they would
body. "To have him home, you                Supporters of home funerals say          have to go through funeral homes.
really know the person isn't there          they pose no health risk under           The amendment was withdrawn last
anymore. That is the whole point, so        normal circumstances.                    month.
that you get used to the idea. By the
third night, I'm ready to see him           Lisa Carlson, executive director of      One benefit of a home funeral,
go."                                        the nonprofit Funeral Ethics             advocates say, is price: A home
                                            Organization, which works with the       funeral can cost only a fraction of a
This kind of after-death care, its          funeral industry to protect and          mortuary funeral, which typically
advocates say, offers a more                expand consumer options, attributes      runs about $5,000, according to the
humane and healing alternative to           the growth of interest in home
                                                         10


Funeral Consumers Alliance. The         she said, "a lot of comfort in being    It was regret over not seeing her
prices can go much higher.              able to perform acts of love in these   mother's body at all that led
                                        unbearable situations."                 American University Park resident
But the most important benefits,                                                Leah Johnson to plan a home
advocates agree, are psychological.     In contrast, Washington                 funeral for her father, James
"There's a tremendous increase in       psychotherapist Riki Alexander, a       Anastos, who died in January at 91.
healing and acceptance of death for     board member of Crossings said:
the family to touch and see and be      "I've had so many clients who           When her mother was fatally
with the departed," Knox said. "It's    grieved for so many years and are       injured in an auto accident in 1985,
very empowering at a time when          so not over it. I wonder if it's        Johnson rushed to the hospital, only
you feel like everything's out of       because they didn't get to have the     to be told that it would be too
control."                               time and see that the person wasn't     traumatic to see her. Because her
                                        there. It becomes this unresolved       mother's cremation was handled by
Knox speaks from hard experience.       thing."                                 a funeral home, as her mother had
In 1995 her 7-year-old daughter,                                                wished, Johnson never saw her
Alison Sanders, died from the           But American norms and                  again.
impact of an airbag that deployed       expectations about death, other
during a low-speed auto accident.       observers say, practically ensure       She said having her mother die
Knox found herself unwilling to         home funerals a limited following.      alone was "too traumatic for the rest
leave after-death care to funeral                                               of my life." She determined that her
home staff, despite the hospital's      "For families that have difficulty      father's death would be different. "I
insistence that it would release the    addressing the topic of death, [a       would do the absolute best for him
body to no one else -- still an all-    home funeral] is much more              at the end."
too-common occurrence, Knox said.       difficult," said Stephanie Handel, a
                                        grief therapist at the Wendt Center     Although her husband and children
"We're required by law to care for      for Loss and Healing in the District.   initially voiced reservations about
our children," she said. "But at the    Facing not only the many reminders      the idea of a home funeral, Johnson
last hour, we're told that their body   of a loved one but also the body        recalled, when she explained how
doesn't belong to us anymore. That      itself "might be too much to cope       much it mattered to her, "they rose
makes no sense."                        with," said Handel, who also directs    to the occasion." They had cared at
                                        a program at the Washington             home for Anastos, who suffered
Knox found a funeral director           morgue that helps next-of-kin cope      from Alzheimer's disease, and one
willing to bring Alison's body          with the legalities of an unexpected    Friday night he died in his sleep.
home, where family members,             death, which include identifying a
friends and neighbors joined in a       Polaroid photograph of the body.        Washing and dressing her father's
three-day vigil. By the time the                                                body with Knox and a close female
funeral director returned to take       Knox agreed, and said she can think     cousin "felt very biblical," Johnson
Alison's body to her funeral and        of many reasons why people might        said. As he lay in their guest room,
then to the crematory, Knox was,        not want a home funeral, such as if     "friends started coming."
she said, ready to let her go.          they're exhausted or have no
                                        supportive community. But, she          "Some didn't want to go up, which
Having imagined, as most parents        added, with an expected death           was fine. Some friends came and
do, that she could never endure the     "there is no law that states that the   just sat there with him. We kept a
catastrophe of a child's death, Knox    body needs to be removed in the         candle burning. It was so good. It
found that "when it actually            first 24 hours. There is much           was just quiet. We were kind of
happened, my senses were so highly      healing and acceptance to be gained     seeing him out. It felt like we were
attuned to the sense of love, I had a   by being with the death at this         really caring for him."
very precise presence of mind, very     time."
clear sense of direction." There is,

				
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