The Trump Effect on Mega-Mergers

In the latest issue of Verden ViewPoint we discussed the likely impact of proposed health insurance company mega mergers. It remains to be seen how the election of Donald Trump could affect the deals between Anthem & Cigna, and Aetna & Humana but it’s entirely possible that a Trump administration would be pro merger.

With the Anthem/Cigna deal already before the courts and the Aetna/Humana trial scheduled for December, it’s fairly safe to assume that decisions in both cases will be made before Trump is set to take office in January but that likely won’t be the end of it.

Conservative Republican Senator Jeff Sessions was recently nominated by Trump to be Attorney General, and while we can’t know how Sessions would deal with antitrust cases, we do know that Trump has said he wants less government regulation of business.

It’s not clear how Mr. Sessions would have the department handle antitrust cases, but Mr. Trump has previously said that he wants “deep cuts” to government regulation of business. It’s doubtful that the DOJ would drop the cases but it’s also entirely possible that the losing party will appeal and that’s where Trump’s influence may come into play. Where a Trump administration will stand on antitrust issues can’t really be known until key positions in Federal Trade Commission and Justice Department are made but it’s not far fetched to think a Trump administration will be more lenient in terms of a settlement favoring a big insurer.




Supreme Court Ruling

I needed a reason to get blogging again. Well, it’s not that I haven’t been offering my opinion out here in cyberspace, but between Facebook, Twitter and writing for Physicians Practice Pearls column, I’ve been neglecting the official blog terribly. Time to change that and no better material than today’s Supreme Court ruling in favor of ‘Obamacare’.

While I would love to spend the time addressing the fallacy of the term ‘Obamacare’ and all of the nonsense that has been written about ‘socialized medicine’, I will instead keep my focus on the present and the importance of this ruling. First, thank goodness common sense prevailed! Yes, some will take me to task for over-simplifying the event by referring to common sense, but I believe that is precisely what we are looking at here.

Now, the reasoning for upholding the individual mandate has been based not on the Commerce Clause, but on Congress’ taxing authority. From the majority on the mandate: “Our precedent demonstrates that Congress had the power to impose the exaction in Section 5000A under the taxing power, and that Section 5000A need not be read to do more than impose a tax. This is sufficient to sustain it.” Politically that gives Republican a hammer with which to bang on about raising taxes, but really, will that matter much?

The important thing here is not the politics though. It is the ability of the average citizen to actually purchase affordable insurance in the market without having to be tied to an employer group plan. This is a HUGE win for THE PEOPLE. As someone who pays more than $2000 a month for healthcare insurance for a two healthy adults and an infant, I for one am delighted at the ruling. And 30 million other people like me, who now may be able to purchase insurance (or pay a ‘tax’ to be able to participate in coverage in some way).

Throughout the course of this whole process – from the initial proposal through today’s ruling – consideration for our fellow man has been largely missing from the debate. Which is, quite frankly, ridiculous. We are the only first world country that does not provide healthcare for its citizens. Instead, we leave them to fend for themselves, and when sick and incapacitated, at the mercy of the profit-making machine that we call ‘healthcare’. That’s shameful. So today’s ruling is FINALLY a step in the right direction in SUPPORTING THE PEOPLE.

If you are interested in the mechanics of the ruling, go here to the SCOTUS blog

Now that we can finally move forward, it will be interesting to see how quickly. Payers and providers alike have already moved on providing value and better controlling costs, what was needed to be able to have AFFORDABLE insurance. Now we can. And market forces can actually go to work. Alleluia!

Insurers Dupe Facebook Users to Fight Reform

by Susanne Madden

Will insurers stop at nothing to derail reform? As previously written about here, Humana pressed its senior members into lobbying against what they see as undesirable aspects of upcoming reform legislation. Now several health plan trade groups have stooped to a new low. Employing an intermediary to pay Facebook users in “virtual dollars” to write letters to Congress opposing aspects of pending reform bills, these groups are hoping to deceive Washington into thinking that the public tide has turned against reform.

Over at Fierce Healthcare, they report that the ‘third party offers users the “currency” they use to buy objects within popular Facebook games like “FarmVille” or “MafiaWars.” They get the currency if they agree to take a survey which, when filled out, automatically sends an anti-reform email message to their member of Congress’.

What is heartening to note is that the company that owns FarmVille and Mafia Wars have removed all such offers from these games. You can read more about these sleazy tactics over at Silicon Alley Insider.

Humana gets political

Federal lawmakers recently urged CMS to investigate a letter sent by Humana Inc. to its Medicare Advantage members. Humana’s undated letter states: “Leading health reform proposals being considered in Washington, D.C., this summer include billions in Medicare Advantage funding cuts, as well as spending reductions to original Medicare and Medicaid. While these programs need to be made more efficient, if the proposed funding cut levels become law, millions of seniors and disabled individuals could lose many of the important benefits and services that make Medicare Advantage health plans so valuable.” The one-page letter is signed by Humana Medicare’s chief medical officer, Philip Painter, M.D.

Scare tactics? I’ll say!

CMS has demanded the company “immediately” stop member mailings warning that reform legislation could hurt them, and to remove any related materials from its Web site.

But CMS did not stop at Humana. It has issued the warning to cover the entire MA industry effective Sept. 21. The agency issued new guidance to MA and Part D plans to “suspend potentially misleading mailings to beneficiaries about health care and insurance reform.” AHIP has responded that seniors “have a right to know how the current reform proposals will affect the coverage they currently like and rely on.” It’s just a pity Humana decided to frame the communication to scare seniors rather than enlighten them.

But the real kicker is that Humana’s letter urged its enrollees to contact their members of Congress to protest healthcare reform. Isn’t it bad enough insurers are spending roughly $1.4 million a day on lobbying efforts in Washington to kill reform without also lobbying its members directly using shoddy ‘facts’? Where do we draw the line and say enough is enough? The numbers don’t lie. Let’s stick with the facts. Insurers are making huge profits at a time when many Americans cannot afford the product they sell. In not other industry would such mis-economics continue to survive, let alone thrive.

Luckily, CMS marketing rules require that member communications to meet certain requirements and the use and disclosure of protected health information to contact members to get them to lobby for or against certain reform legislation appears to be something that HIPAA rules do not allow. At the least, Humana will be facing fines and perhaps suspension from MA activities for a while.

However, that does not compensate for the misinformation. Unless Humana is required to send a notification to those same members informing them of its wrong-doing, it has accomplished its goal and moved real reform further out of reach.  How big a blow has a simple letter like this dealt to progression? As of the end of the second quarter, Humana had 1.5 million MA enrollees, all of whom may have recieved this letter. . .