Consulting Strategies Team

It's snowing in Henderson

2011-12-27T09:57:00.001-05:00

What a great way to close out a Merry Christmas weekend!!

Kentucky Medicaid Managed Care Delayed

2011-09-20T23:42:00.003-04:00

Governor Beshear’s move to Medicaid managed care in the Commonwealth of Kentucky has been halted until November 1st. The delay came in response to a request from the Kentucky Hospital Association according to comments from Cabinet for Health and Family Services Secretary Janie Miller.

During the 2011 Legislative Session and subsequent “Extraordinary” Session, the administration balanced last year’s Medicaid shortfall by moving millions from state fiscal year 2012 to 2011, promising that the funds would be saved in 2012 due to statewide implementation of Medicaid managed care. Originally, the administration said implementation would occur July 1st. Clarification was later issued that July was the target award date, and the program start date was set for October 1st, thus limiting the amount of time in 2012 for those funds to be recouped through savings.

The additional one-month delay comes with a hefty price tag for Kentucky taxpayers as over $9 million worth of savings will be lost. The reason cited for the delay was a request from hospitals to have another month to evaluate the managed care plans and enter into contracts to provide services under the plans.

Several lawmakers have expressed concern over this “reason,” pointing to an August letter that was sent from Medicaid to providers that specifically told hospitals they would be paid at the Medicaid rate if they did not sign up with a managed care plan and a recipient needed hospital services that could not be provided by a participating hospital.

Just last month, advocates for provider groups and Medicaid recipients had already petitioned for a delayed start date over concerns that the program was not ready to begin in October.

The Medicaid Advisory Committee’s request for such a delay was denied by Beshear and they were told that implementation was on track and there would be no delays. The administration cited the critical need for savings in the Medicaid program and touted safeguards that would deal with any implementation issues.

Report Confirms Guatemalan Abuses by US Government

2011-09-14T19:55:00.002-04:00

TheUS Presidential Commission for the Study of Bioethical Issues concluded theirreview of studies conducted in the 1940’s related to sexually transmitteddiseases (STDs). Last year several Guatemalan victims of the studies cameforward and have since brought suit against the United States.

Approximately5,500 Guatemalans were involved in the research by the US Public Health Serviceand nearly 1,300 of the participants were intentionally infected with syphilis,gonorrhea or other sexually transmitted diseases. Moreover, less than 1,000 of the participants received any treatment for the STDs.

Noneof the participants were asked for consent prior to being infected. The studyconcluded that even given the different bioethical standards of the time period, thescientists knew that the studies were well outside of the standard of practice.

PresidentObama has since issued an apology to the study victims and to his Guatemalancounterpart, Alvaro Colom.

Louisiana Managed Care Initiative Temporarily Halted

2011-09-13T08:30:00.000-04:00

ALouisiana judge has issued s temporary restraining order to block theimplementation of Medicaid Managed Care for over 800,000 recipients.

Theorder was granted at the request of Aetna Inc., a company that lost in theirbid to serve the population as a managed care carrier. The company is nowprotesting the state’s selection of Louisiana Healthcare Connections Inc., asubsidiary of Centene; Amerihealth Mercy of Louisiana Inc.; and AmeriGROUPLouisiana Inc.

TheLouisiana Department of Health and Hospitals had previously rejected theadministrative appeal filed by Aetna and the company chose to move forward withan action in Baton Rouge District Court.

Aetnaargues that the state did not follow proper procedures when scoring the bidsfrom potential MCOs.

Thetemporary restraining order came down just as state officials had startedcontract negotiations with the winning vendors.

HHS Issues New Privacy Rules and PHR Model Privacy Notice

2011-09-12T15:10:00.000-04:00

Today the Cabinet for Health and Human Services released new rules outlining the rights of patients’ access to health information. The new provisions enable consumers to receive lab test results and other health information directly from labs through the use of health information technology.

Secretary Sebelius inrtoduced Leon Rodriguez as the new Director of the Office for Civil Rights (OCR). OCR is the agency responsible for HIPAA enforcement and oversees and investigates all complaints or concerns related to consumer privacy protections.

“Consumers need to know that private and secure access to their health information is a given,” stated OCR Director Rodriguez. “The privacy and security of health data will be a top priority for OCR during my tenure.”

This announcement along with the unveiling of the long awaited voluntary Personal Health Record (PHR) Model Privacy Notice occurred at the kick-off meeting of the first HHS Consumer Health IT Summit.

The model PHR notice is meant to improve consumer understanding of privacy practices and build public trust in electronic health records. Its development has been in the works for several years.

“As technology improves more aspects of our daily lives, it makes sense to marry cutting-edge technology with our medical and personal health records so that we can improve both the quality and efficiency of the care that people receive,” said National Coordinator for Health Information Technology, Farzad Mostashari, M.D., Sc.M. “We are encouraging everyone to visit our website at www.HealthIT.gov to read our newly released Strategic Plan that sets forth our comprehensive plans for consumer empowerment for the next five years.“

The PHR Model Privacy Notice was released for public use and is available at:
http://healthit.hhs.gov/portal/server.pt/community/healthit_hhs_gov__draft_phr_model_notice/1176

Medicare Implements Expanded Competitive Bidding Program

2011-08-19T23:13:00.001-04:00

Medicare is entering the second phase of a competitive bidding program aimed at lowering the cost of durable medical equipment, prosthetics, orthotics, and supplies.

Nine product categories were included in the first phase of the program that started January 1, 2011. According the data maintained by the Center for Medicaid and Medicare Services (CMS), the initial phase yielded savings of 35% with no change in beneficiary health status.

Phase two will further the program by adding an additional 91 major metropolitan areas to the demonstration.

Competition begins this fall, and the new prices will be in effect on July 1, 2013.

“Today, we’re taking steps that will save Medicare, seniors, and taxpayers $28 billion over 10 years,” said CMS Administration Donald M. Berwick, M.D. “Medicare is paying much more than the private sector for equipment like wheelchairs and walkers. By expanding our successful competitive bidding program, we can ensure that Medicare pays a fair rate for these goods.”

The expanded Round Two categories of products are:

· Oxygen, oxygen equipment, and supplies;

· Standard (Power and Manual) wheelchairs, scooters, and related accessories (a new category that combines all mobility devices);

· Enteral nutrients, equipment, and supplies;

· Continuous Positive Airway Pressure (CPAP) devices and Respiratory Assist Devices (RADs) and related supplies and accessories;

· Hospital beds and related accessories;

· Walkers and related accessories;

· Negative Pressure Wound Therapy pumps and related supplies and accessories (new category);

· Support surfaces (Group 2 mattresses and overlays).

A list of ZIP codes included in Round Two and a list of the specific items in each product category are available on the website for the Competitive Bidding Implementation Contractor, www.dmecompetitivebid.com.

CMS Proposes Changes to Community Health Centers

2011-06-24T18:03:00.004-04:00

CMS released a proposed rule that would establish conditions of participation for community mental health centers (CMHCs). Donald Berwick, CMS Administrator, cited safety as the primary reason for the changes.

Under the proposed rule, Medicare provider requirements would now apply to Community Mental Health Centers. The concept is to encourage best practices by memorializing standards of practice for all providers.

CMHCs provide partial hospitalization services to Medicare beneficiaries, including physician services, psychiatric nursing, counseling and social services. The Medicare benefit offers an alternative to in-patient treatment.

The new conditions for Medicare participation require the CMHCs to:

Establish qualifications for CMHC employees and contractors
Notify clients of their rights and investigate and report any violations of client rights
Develop an active treatment plan for clients and ensure an interdisciplinary approach to care
Create a Quality Assessment and Performance Improvement (QAPI) program that measures client health outcomes and satisfaction, and creates a systematic approach to improve quality of care

CMS is accepting public comments on the proposed rule until Aug. 16. Those interested in commenting should go to the CMS website and search for rule CMS-3202-P.

Support the Veterans' Traumatic Brain Injury Rehabilitative Services' Improvement Act of 2011

2011-06-06T18:24:00.002-04:00

Senator John Boozman (R-AR) and Senator Mark Begich (D-AK) introduced S 957 and Congressman Tim Walz (D-MN/1) and Congressman Gus Bilirakis (R-FL/9) introduced legislation HR 1855 to ensure a stronger commitment to our nation’s veterans who sustained traumatic brain injuries in Iraq and Afghanistan.

If passed, the Veterans’ Traumatic Brain Injury Rehabilitative Services’ Improvement Act of 2011 will require the Veterans’ Administration to provide veterans who have Traumatic Brain Injury with ongoing, long-term rehabilitative care. TBI is different from other types of injuries in that the patients require ongoing rehabilitative services to avoid losing the improvements they have made. Maintenance requires intensive services including both medical and non-medical supports such as homemaking and personal care services.

Staying active socially and remaining with friends and loved ones is critical to quality of life for our veterans. This legislation includes supports to allow the veterans to live independently.

This legislation brings our veterans into a model that many Medicaid programs have already adopted for Medicaid recipients. Specifically, the bill would clarify that VA may not prematurely cut off needed rehabilitation services, and that these veterans can get the supports they to remain as independent as possible.

I urge you to ask your Senators and Congressman to support our nation’s veterans through their support of S 957/ HR 1855.

Rate Increase Disclosure and Review Rule Could Have Significant Impact on Association Health Plans

2011-06-02T14:00:00.002-04:00

May 23, 2011, HHS issued the Rate Increase Disclosure and Review Final Rule. This outlines the proposed oversight of health plan rate setting under the Patient Protection and Affordable Care Act (PPACA). The new rule requires states to review individual and small group rates filed or effective after September 1, 2011. The new rules do not apply to grandfathered health plans as defined under PPACA.

Apart from the new rate increase summary that carriers must prepare for consumer disclosure, HHS plans to address the status of plans issued by associations.

HHS noted the comments related to the regulatory treatment of association health plan rates. HHS chose not to define the market status of association plans, however, and instead has requested comments by July 18, 2011 regarding the definitions of “individual market” and “small group market” in relation to coverage obtained through associations.

“We generally deferred in the proposed rule to the State definitions of individual and small group markets. In response to the proposed rule, we received comments indicating that, in some States, association coverage is considered to be large group coverage, resulting in individual and small group coverage sold through associations not being subject to the rate review process… However, since including all individual and small group coverage sold through associations in the rate review process could have a large impact on the markets in some States, we are incorporating the proposed definitions of individual market and small group market into the final rule and solicit additional comments on this issue, with the possibility of amending the final rule after receiving comments in order to include coverage sold through associations in the rate review process.” [Fed. Reg. Vol. 76, No. 99, page 29984]

Although HHS is seeking public comment, they have indicated a predisposition to include association health plans in the rule and override state treatment of associations as “large group” plans:

“Given the comments received and our policy goals with regard to rate review, we are inclined to amend the definitions of individual market and small group market in § 154.102 to include coverage sold to individuals and small groups through associations in all cases… If we were to amend the definitions of ‘‘individual market’’ and ‘‘small group market’’ in § 154.102 to include individual coverage and small employer coverage sold through associations in the rate review process, the amendment will only be applied prospectively.” [Page 29965-66]

Comments must be received by 5 p.m. EST on July 18, 2011.

HHS announces proposed changes to HIPAA Privacy Rule to Allow People to Know Who Has Accessed Their Health Information

2011-05-31T15:47:00.000-04:00

The U.S. Department of Health and Human Services’ (HHS) Office for Civil Rights (OCR) is proposing changes to Privacy Rule, pursuant to the Health Information Technology for Economic and Clinical Health (HITECH) Act.

A Notice of Proposed Rulemaking is available for public comment. The proposed rule would give people the right to get a report on who has electronically accessed their protected health information.

People can now request an access report that documents the person(s) who electronically accessed and reviewed their protected health information. Prior to this proposed rule Covered Entities subject to the requirements of HIPAA did not have to release this information directly to individuals.

“This proposed rule represents an important step in our continued efforts to promote accountability across the health care system, ensuring that providers properly safeguard private health information,” said OCR Director Georgina Verdugo. “We need to protect peoples’ rights so that they know how their health information has been used or disclosed.”

The comment period ends August 1, 2011, and the new proposed rule may be reviewed at: http://www.federalregister.gov/

Department of Labor Delays Implementation of PPACA Internal Claims and Appeals Requirements

2011-03-28T14:53:00.004-04:00

The Department of Labor has again delayed enforcement of the new requirements for internal claims and appeals that apply to non-grandfathered plans pursuant to the Patient Protection and Affordable Care Act.

The extension was prompted by the DOL’s intention to amend the interim final regulations issued in July 2010 in light of feedback received during the comment period.

Technical Release 2011-01 extends and slightly modifies the enforcement grace period that was set to expire on July 1, 2011. The non-enforcement period now extends until plan years beginning on or after July 1, 2011 for certain requirements, and plan years beginning on or after January 1, 2012 for others.

For example, the following timelines and requirements apply to non-grandfathered plans beginning on or after July 1, 2011:

Notices of adverse benefit determinations must include specific information that identifies the claim, date of service, health care provider, and claim amount.
Notices of adverse benefit determinations must include the reasons for the denial.
Plans must provide a description of the available internal appeals and external review processes.
Plans must disclose availability of and contact information for an office of health insurance consumer assistance or ombudsman.

For more information on PPACA compliance issues and implementation requirements, please visit www.CSTedge.com for our contact information and additional resources.

Florida Judge Says Obamacare Is Unconstitutional

2011-01-31T18:17:00.005-05:00

A federal judge in Florida ruled today that one of the key provision of health care reform - the individual mandate - is unconstitutional. The mandate required that most Americans purchase health insurance by 2014 or face stiff penalties. As a result of the ruling, the entire text of the law is deemed unconstitutional. The judge declared, "Because the individual mandate is unconstitutional and not severable, the entire Act must be declared void."

Florida was one of 25 states to file suit against the Patient Protection and Affordable Act, known to many as "ObamaCare." The Justice Department said it intends to appeal the ruling. In response to today's ruling, House Speaker John Boehner, R-Ohio, urged the Senate to take up the repeal bill that has already been passed by the House.

A federal judge in Virginia previously ruled the law unconstitutional as well, but two other judges have ruled just the opposite, making it likely that the Supreme Court will eventually take up the case.

AMHP pays $2M settlement to OAG

2011-01-26T19:35:00.006-05:00

Amerihealth Mercy Health Plan, the third-party administrator for Passport Health Plan, has agreed to pay more than $2 million to the Kentucky Office of Attorney General in damages. The OAG has been investigating AMHP for the last nine months in regards to a complaint from a whistleblower. The OAG found that AMHP employees altered medical data to raise the company's HEDIS scores for cervical cancer screenings in 2009. The higher score allowed AMHP to receive $677,000 in bonus money.

Read the rest of the OAG's press release here:
http://migration.kentucky.gov/Newsroom/ag/amerihealthmercy.htm

Kentucky Medicaid Releases 6 RFIs (Requests for Information)

2011-01-18T12:22:00.004-05:00

On January 5, the Kentucky Department for Medicaid Services released six RFIs for managed care services. On the same day, the Cabinet also announced the creation of a new branch within DMS that would oversee the managed care activities – the Medicaid Managed Care Oversight Branch - however, no word yet on who has been chosen to head the new branch or how many staff will be needed. You will recall that the Department still has not identified a permanent commissioner. Deputy Commissioner Neville Wise is still the acting commissioner but sources indicate he is not interested in making the job permanent.

In late November Gov. Beshear announced that the Cabinet would be taking steps to help balance the $6 billion Medicaid budget, including the development of public-private partnerships to implement innovative cost saving measures and improve health outcomes. DMS is seeking to contain program costs using managed care techniques and improved quality of care. All of the RFIs are built around the ideas of a medical home and coordinated delivery of care. To the extent that DMS utilizes MCOs, DMS will require guaranteed savings and the opportunity for Medicaid members to change plans.

Interestingly, some of the RFIs leave open the possibility of a state-wide service area, meaning that some services, such as pharmacy management, could be carved out of the 16-county region currently operated by Passport Health Plan. In brief, the six RFIs are:

Capitated Pharmacy Managed Program
DMS is interested in exploring a medication therapy management (MTM) program with an emphasis on those with multiple chronic conditions and/or behavioral health issues. The MTM program should be based on clinical evidence reviews from reliable sources and fit within the context of a medical home model.

Dental Managed Care/Pay for Performance
As we all know, Kentucky's edentulism rate is amongst the highest in the nation. DMS wants to increase the number of Medicaid recipients who get a dental visit by improving dental access. Models should emphasize preventative dental care but include diagnostic and restorative dental care, as well as special EPSDT benefits. DMS is also considering a Pay-for-Performance program to increase provider participation within the dental network.

Dental Home for Children Only Initiative
On April 26, 2010, CMS announced new oral health goals for children enrolled in Medicaid and SCHIP. In Kentucky, only about 50% of children in FFS Medicaid receive a preventive dental visit. DMS wants to implement a dental home model to improve children’s access to and utilization of dental benefits, especially preventative dental care. Models should integrate each of the nine components advocated by the American Academy of Pediatric Dentistry.

Managed Care Initiative
DMS is seeking ideas for innovative managed care delivery models using a capitated payment system. Models should utilize the medical home concept and provide coordinated, comprehensive care (including behavioral health services) for all Medicaid members, including those in nursing facilities, ICF/MRs, and those in waiver programs. Targeted programs will also be considered. The model should include typical TPA services, including utilization management, case management, disease management, program integrity, member/provider enrollment, call centers, claims processing, TPL, quality improvement, performance measurement, and pharmacy management.

Pay-for-Performance Program Models
Currently FFS Medicaid utilizes a primary care case management system called KenPAC (Kentucky Patient Access and Care System) in which providers are paid a monthly management fee for each Medicaid recipient enrolled with that provider. The objectives of the KenPAC program are to reduce costs, prevent unnecessary utilization, ensure adequate access to quality care, and establish a medical home through the provider-patient relationship. DMS is seeking other proven Pay-for-Performance program models that improve the quality and efficiency of health care to successfully achieve the objectives of the KenPAC program.

All Inclusive Care for the Elderly (PACE)
The Program of All-Inclusive Care for the Elderly (PACE) provides prepaid, capitated comprehensive health care services to frail older adults who meet nursing facility level of care and live in the community. DMS is seeking ideas for innovative PACE delivery models utilizing a medical home concept for Medicaid recipients age 55 years or older. The model should integrate acute and long-term services and offer a coordinated approach to care with a focus on prevention.

All of the RFIs are due on February 7, 2011 at 3:30 pm EST. For additional information regarding the RFIs or assistance in preparing a proposal, please contact Consulting Strategies Team.

GOP caucus again elects David Williams to head state Senate

2010-11-08T10:27:00.000-05:00

GOP caucus again elects David Williams to head state Senate

Kentucky Election Returns Link

2010-11-03T15:42:00.003-04:00

http://myemail.constantcontact.com/News-from-MShrader---Associates.html?soid=1103755402342&aid=Zz9WE7esld0

This a link to a recap of yesterday's Kentucky House & Senate races.

A Study In Health Care Reform

2009-08-22T19:28:00.005-04:00

A recent analysis from the Commonwealth Fund called Paying the Price: How Health Insurance Premiums Are Eating Up Middle-Class Incomes suggests that health insurance reform is the answer to solving the health care cost problems. The report lists certain reforms that should be implemented: (1) leveraging public purchasing power, (2) reducing administrative waste, (3) creating incentives for better health and cost outcomes, and (4) having insurance companies work in the public interest. The goals of this reform are touted as better access, better quality, and slower cost growth.

The idea of better access is intriguing. I suppose it depends on what you mean by “better” access. If you mean expanded access because more people are covered by some kind of insurance plan, then perhaps this may be true. In a minute we will explore the experience of Massachusetts, the first state to pass a health insurance mandate. If “better access” means enhanced access due to broad-based provider networks, then there could be an inherent struggle.

The problem with much of the recent discussion about health care reform is that folks seem to want things both ways. We want unlimited choice but we don't like the price tag it comes with. Heck, insurers would love to offer plans with scaled-down provider networks that focus on having an adequate number of high quality providers. They tried it back in the 1990s. But there were so many “health care reform” laws passed in a backlash against managed care that insurance companies are often prohibited from taking these simple steps by law.

For example, in Kentucky we have a law that says insurance companies must have a hospital and a primary care provider within 30 minutes or 30 miles of every single member of its health care plan. Specialists have to be available within 60 minutes or 60 miles of every single member of its health care plan. Insurers are required to run reports demonstrating that they meet this network “adequacy” requirement. This law was passed due to the barrage of consumer complaints about the tightly managed provider networks offered by their health insurers. People want to go to “their” doctor and “their” hospital, regardless of how much it costs or how good someone tells them the quality is (or isn’t). They want freedom of choice, baby.

In a mostly rural state like Kentucky, this means an insurer needs to have virtually every single community hospital in the state in order to meet this requirement. The reality is that some of these smaller hospitals are likely to be the ones left out in the cold if health care reforms that focus on high quality and low cost are implemented. Why? Because hospitals, by nature, have high fixed costs. They require a tremendous amount of infrastructure. These hospitals may only see a relatively small number of people per year. In order to cover their fixed costs when there isn’t a large patient volume to support it, their variable costs are higher. Because they may perform a significantly smaller number of procedures, their quality outcomes may not be as high as a hospital with a high volume. To add more fuel to the fire, hospitals are often one of the largest employers in small communities. Closing a hospital means more than closing a hospital and asking patients to drive further. It means a blow to the economy. A loss of jobs.

So back to the Commonwealth Fund report. One of the most interesting notes from the study was the state-by-state comparison of premium costs. The state with the highest premium costs in the country is….(drum roll please)….Massachusetts. Why is that interesting, you may ask? Because in 2006 Massachusetts passed landmark “health care reform” that required that everyone in the state have health insurance coverage. The goals of this reform were to provide high quality affordable health care to all citizens. To ensure access to coverage, Massachusetts (1) expanded Medicaid, (2) created a publicly subsidized private insurance plan called Commonwealth Care to cover those earning up to 300% FPL who didn’t qualify for Medicaid and didn’t have access to employer sponsored insurance, (3) required insurers to offer plans that meet a “seal of approval,” and (4) required insurers to offer a specific low-cost plan to residents 19 to 26 years old who don’t qualify for Medicaid and don’t have access to employer health coverage (either on their own or through their parents).

To ensure coverage, Massachusetts required employers with 11 or more FT employees to either offer health insurance or pay a penalty and required individuals to have health insurance or pay a penalty. To improve quality of care and control cost, Massachusetts created a Health Care Quality and Cost Council whose objective is to set cost and quality goals and provide consumers with comparative information about providers to help them make educated and informed treatment decisions, developed an infection control program, and implemented a wellness program. The reform model also included some efforts towards electronic record keeping. Sound familiar?

It should, considering it is the basis for the national health care reform we’ve been talking so much about. So how did Massachusetts fare? We have to go back to the beginning. Massachusetts actually started from a better place than the rest of the U.S. Even before reform, the state had a history of a relatively low number of uninsured citizens (only about 6%) and a relatively high rate of employer sponsored insurance. So when reform began, 94% of Massachusetts residents had coverage. Not too shabby.

So where are they now? Three years after reform, 97% have a coverage, a gain of 3%. Again, not too shabby. But perhaps less than expected, especially considering that “reform” has been a budget buster for the state. Massachusetts expects to spend a whopping $595 million more on its health insurance programs in 2009 than it did in 2006 when reform was passed, an increase of 42%. So to get a gain in coverage of 3% = cost increase of 42%. Yikes!

What’s a state to do? Well, in 2008 Massachusetts was forced to raise health insurance premiums and increase copayments to help stabilize the program. Before anyone squawks, notice I said “Massachusetts” had to raise premiums and copayments. For their publically funded plan. They also increased the state tobacco tax to increase revenue to help pay for the struggling plan.

In December Massachusetts reported that a majority of the approximately 200,000 citizens who were still uninsured were the “young and healthy.” These are the very adults that a universal system most needs to have in the mix because they are typically inexpensive, so they help balance out the higher costs of the older and sicker. The end result of Massachusetts’ reform is that premium costs in the state are about two to three times the level of inflation, much higher than anticipated, and available funds to support the public plan options are dwindling dramatically, so much so that discussions are brewing over whether or not to exclude legal immigrants who haven’t yet obtained permanent status from the public plan in order to trim costs.

So what’s next for the program? Some health policy analysts say that simply changing payment methods won’t be enough to slow the growth in cost, even when efforts are combined with other cost-cutting mechanisms. They say the only way to truly control costs is to stop spending, and that could mean…rationing of care. Just like they already do in many of the countries that provide universal coverage. Get ready to pick your poison, America.

Is America ready for a culture shift? Societal mores can't be ignored in the health care reform debate

2009-08-18T16:34:00.009-04:00

In 2007 the Commonwealth Fund ranked the United Kingdom’s health care system as number one amongst six countries, including the U.S. The study ranked the systems using six measures: quality care, access, efficiency, equity, healthy lives, and health expenditures per capita. The quality care measure was further broken down into four areas: right care, safe care, coordinated care, and patient-centered care.

The U.S. ranked last in nearly every measure. We managed to just squeak ahead of Canada and take 5th place for quality care, coordinated care, and patient-centered care. We actually ranked 1st for right care because of our success in ensuring folks get preventive care.

Not surprisingly, access was one of the key issues that worked against the U.S. Americans were the most likely of those surveyed to say they had problems accessing care because of cost, except for those with insurance. Insured patients in the U.S. have some of the best and most rapid access to services in the world. In other countries that provide universal coverage, the cost of care wasn’t a barrier to access – but long waiting times to receive care were a problem.

One of the most interesting things about the study is the way in which the information was collected. The rankings are based on national mortality data and the perceptions and experiences of patients and physicians. The rankings do NOT consider objective data available in medical records or administrative findings. The study authors note, “Patients’ and physicians’ assessments might be affected by their experiences and expectations, which could differ by country and culture.”

Cross-cultural studies have repeatedly demonstrated that the national culture is the main factor in determining human behavior in all aspects of social life, including business. The world may be getting smaller, but cultural differences between countries still run very deep. I am not trying to say that everyone within each country is the same, or even that all the many countries that comprise Europe can be placed in one uniform bucket (yes, Miss Teen South Carolina – Europe is a CONTINENT, not a COUNTRY). The point is that differences within a country are much less significant than the differences between countries.

The impression that globalization is making us a unified world may be mistaken. Yes, most of the world eats at McDonalds and watches MTV. But these are superficial cultural artificats that are more a reflection of prosperity than a shift in cultural norms. According to a World Value Survey that was conducted in more than sixty countries throughout the world, as much as 85% of the variation between countries can be explained by cultural plus economic factors. This seemingly would include health care.

Some of these variances can be significant. For example, the level of individualism (versus collectivism) in Europe varies from moderate to high. But Americans hold the top position in individualism among all other countries. This attitude translates into a difference in attitude towards goods and services. Europeans have a very egalitarian attitude. When the French were surveyed, they said they preferred for everyone to have the same access to healthcare, even if the quality of the healthcare were lower, rather than having a society in which the quality of healthcare was higher but access was uneven.

This sort of thinking doesn’t seem to be as prominent in the U.S. Americans want the highest quality of everything and the focus on quality may come at the expense of other aspects that may be deemed less important, like access. Thus it seems then that the expectations of Europeans and Americans are different. This could certainly color the lens through which the healthcare system, as well as everything else, is viewed. Let’s start with the most basic of activities – having a meal. In Europe a meal is expected to take a leisurely hour and a half, even two or three hours. Waiters seem in no hurry. In the U.S., many folks have ordered, consumed, and paid for a meal in under 30 minutes.

Housing and personal space is another good example. Today the average size of a new home in the U.S. is 2400 sq ft. In Europe, the average size is only about half that. Oftentimes the “master” bedroom won’t accommodate a king-sized bed. The hot water heater is a small box that fits on the wall, whereas most of us have gigantic 50-gallon behemoths to house our water. And what about the differences in our cars?! Not to mention that many Europeans get around by bicycle or walking. The point I am making is, Europeans and Americans are different.

One statistic that is often cited as being representative of failure of the U.S. healthcare system is infant mortality. According to the CIA World Factbook, the U.S. has 6.26 deaths per live births, a high rate for a developed country. Contrast that to Canada at 5.04, Britain 4.85, France 3.33 and Germany 3.99 deaths per live births. Startling, right?

But I don’t think this statistic can be fully understood without considering another - the abortion rate. In 1995, the total number of abortions performed in Europe was 7.7 million. In Northern America (which includes both the U.S. and Canada), there were 1.5 million abortions. This translates to an abortion rate of 48 per 1000 women in Europe versus 22 abortions per 1000 women in Northern America. In other words, the abortion rate is 118% higher in Europe than in Northern America. Why is this relevant? Because it may reveal an important cultural difference at play here as well. If American women are more likely to continue with a pregnancy, even when the fetus is discovered to have an incurable or devastating disease, then we may be delivering significantly more very sick babies that can’t be expected to live as long.

A closer look at attitudes toward abortion is in order to help better understand what may be happening. A 2007 CBS News poll about abortion in the U.S. asked, “What is your personal feeling about abortion?” 30% said that it should be “permitted only in cases such as rape, incest or to save the woman's life”, 31% said that abortion should be “permitted in all cases”, 16% that it should be “permitted, but subject to greater restrictions than it is now”, 12% said that it should “only be permitted to save the woman's life”, and 5% said that it should “never” be permitted.

Contrast that to a 2005 Euro RSCG/TNS Sofres poll that examined attitudes toward abortion in 10 European countries, asking polltakers whether they agreed with the statement, “If a woman doesn't want children, she should be able to have an abortion.” Some of the results are as follows:

“Very much” “A little” “Not really” “Not at all”
France 55% 23% 8% 13%
Germany 40% 24% 10% 24%
Italy 29% 24% 16% 25%
Netherlands 37% 22% 11% 26%
Spain 41% 18% 8% 27%
U.K. 43% 23% 10% 19%

Clearly attitudes towards abortion are very different in the U.S. and Canada from those in Europe, where abortion is much more common. These kinds of cultural biases and preferences have not been taken into consideration in the Commonwealth Fund survey or most other surveys on healthcare systems. We will continue to examine these underlying cultural norms and values that shape an individual’s perspective on what is important in life and society.

The one thing that is TRULY universal – health care dissatisfaction

2009-08-17T01:39:00.003-04:00

We may not have agreed on the best way to achieve universal health care yet, but we Americans can seem to agree on one thing: unhappiness with the current system. A 2007 Commonwealth Fund survey showed that 82% of us believe that our current health care system either needs fundamental change or should be completely rebuilt. We’ve heard arguments about the high cost and inferior quality of care in the U.S. from critics who point to Canada, Germany, Great Britain, etc. as models for reform. Interestingly enough, the same survey from the Commonwealth Fund reveals that a majority of the citizens of those countries share our feelings -- 72% of Canadians, 78% of Germans, and 72% of Brittons believe their health care systems need fundamental change or should be completely rebuilt. WTF?

We already know the problems within our system: rising costs, varying quality, and barriers to access. But what’s going on in these faraway lands where the access problems have been solved and everyone’s supposed to be covered?

A case study of these countries reveals some serious problems. Some of these problems – like rising costs – they share with us. Other problems are ones we haven’t experienced yet, like rationing of care, waiting lists, and lack of access to medical technology. So what “magic bullets” are being considered to address their problems?

Surprisingly, it seems that they have taken a lesson from the managed care playbook. When you get right down to it, there are really only two basic ways of dealing with rising costs – (1) pass them on or (2) reduce utilization. Our European neighbors are doing some of both by increasing taxes and restricting benefits. Sound familiar? Like rising premium costs and decreased benefits?

So what other options are being considered? Higher copayments. Physician “gatekeepers” who control access to specialists. Reduced reimbursement to doctors and hospitals. Removing high-cost drugs from the formulary and replacing them with low-cost generics. This is beginning to sound very familiar indeed…

So we’ve all got problems and it seems we’ve all got similar solutions –namely market-oriented forces, many of which we’ve already put in place here in the U.S. So as we debate whether or not to adopt some sort of government-run health care system, those countries that have some sort of government-run system are debating about how to make their health care systems look more like us!!

In upcoming blogs I will be exploring the health care systems of other countries, focusing on those that are being touted as models for our own health care reform. We will examine the triumphs and pitfalls of each and take a closer look at the societies and cultures behind them.

Planes, Trains & Automobiles - Algae can run them all

2009-08-13T09:33:00.001-04:00

The Community College in Henderson Kentucky hosted the Ohio River Algae Symposium this week organized by the University of Kentucky Center For Applied Energy and Ohio University. One of the most fascinating and motivating presentations was from Brian Goodall, Vice President of Sapphire Energy. While much of what he said was so new to me it took a bit for me to grasp it, I knew I was listening to something that was cutting edge and could radically change the way we think about Algae and transportation fuels. Apparently, under the right conditions, you can grow algae in large amounts and turn it into diesel fuel, gasoline, & jet fuel and do so in a way that makes them environmentally friendly products. Um? See already this was different.

Sapphire Energy, a California based company, was started by a group of scientist and business people that thought there was an out of the box solution to our carbon-based fuel problem. Sapphire’s goal is to be the world’s leading producer of renewable petrochemical products. And it appears that they are well on their way. The fuel they produced from algae powered a commercial Continental flight in January of this year. This got the attention of the air force, a large consumer of jet fuel. If Sapphire Energy can take their demonstration project, which has a production capacity of 100 barrels a day, to say 5000 barrels a day at a competitive price then we could see algae based fuels replace oil entirely.

Sapphire says that the company’s final products will have the same chemical composition as gasoline and will be completely compatible with the existing refining, distribution and fleet infrastructure. So their product is not ethanol or biodiesel, but a source of renewable gasoline. Broad scale adoption will not require a new infrastructure because it can be refined to the exact standards for petroleum based fuels and can be distributed in a similar manner.

The process to grow this fuel requires water, CO2 and sunlight. A cutting edge process that is being developed will allow the capture of CO2 from coal-fueled power plants that can be consumed in the algae growth process. This makes the use of the fuel-produced carbon neutral. That’s a plus. Another plus, algae is not consumed as a food product, therefore, unlike corn, large-scale commercial use will not drive up food costs.

So what are the problems? The technology is still being developed. Speakers throughout the day talked about new ways being developed to grow algae commercially and on a large scale. It’s more than a concept, but not much past demonstration projects yet, albeit successful demonstration projects. The key is to bring down production cost by locating near abundant water and carbon sources, developing a more efficient process to remove the water, identifying the best species for the growing environment and end use, and developing viable low cost growth containers.

Sapphire Energy says they are on their way and believe they will have the capacity to produce a million barrels of renewable algae based petrochemical products in 2011. Stay Tuned.

For more information on Sapphire Energy see them online at http://www.sapphireenergy.com/

The event was sponsored locally by the Kentucky Department of Energy Development & Independence, the Henderson Chamber of Commerce and the Henderson Fiscal Court.

The Media Coverage of the Fancy Farm - Conway Issue Continues

2009-08-10T11:54:00.004-04:00

Senator Jim Bunning announced the week leading up to the Fancy Farm picnic that he would not be seeking another term in 2010. This created the opening that the major contenders had been seeking. Two Democrats, Attorney General Jack Conway and Lt. Governor Dan Mongiardo had already announced their intentions to run. Republican Secretary of State Trey Greyson had formed an exploratory committee, which he turned into a full-blown campaign immediately after Bunning's announcement.

Without a fall election this year, all political eyes turned to next year’s race at Kentucky’s premier political event, the Fancy Farm Picnic. The candidates were out working the crowd and perfecting their talking points. Jack Conway, Kentucky’s Attorney General announced that he was “one tough SOB”, creating interest from the media, YouTube enthusiast and the Colbert Report on Comedy Central.

WHAS11 in Louisville ran another story this past weekend summarizing the controversy, replaying the Colbert Report and adding a link to the YouTube video. If you are interested check out this link, http://www.whas11.com/topstories/stories/whas11-politics-090807-conway-backlash.b9d975c6.html.

Opening the Dialogue of True Reform

2009-08-09T21:57:00.004-04:00

Tonight on his Fox News show, Governor Huckabee talked about several aspects of health care reform and had a variety of experts on to give their take. Whether you support the President's plan or not, I recommend that you take the time to hear various points of view. I am very impressed with Governor Huckabee's knowledge of the health care reform issues. I was particularly pleased when he brought up the true number of uninsured Americans and posed the question of "which problem are we trying to solve?" My partners can attest to my rants on these very issues.

I don't think that the American people want to turn our health care system on its ear in a mad rush. I, for one, do not want to plow forward without knowing what the problem is that we are "solving." Having worked in private health insurance, served as Medicaid Commissioner for the Commonwealth of Kentucky, and now as executive vice president of a provider sponsored Medicaid and Medicare managed care plan in Kentucky, I have been on all sides of this equation. In my opinion, we must first clean up the ills of Medicaid and Medicare before we add yet another government program. I was very disappointed to see that these programs remain virtually unchanged in the the proposed reform, and in fact are expanded. Our current government programs are largely behind our health care system shortfalls, both financially and in terms of promoting positive health outcomes. President Obama has said himself that Medicaid and Medicare are simply unsustainable. Adding another government program and expecting a different result seems illogical.

I hope that other media figures take the opportunity to get the issues with health care reform out into the light of day. Health care is a bipartisan issue. There is no silver bullet, so only through a thorough discussion of all aspects of the problem, as well as the proposed solution can we craft any reasonable approach to health care reform.

New HHS State Specific Health Care Reform Reports

2009-08-09T09:27:00.008-04:00

On Friday HHS Secretary Sebelius released the second round of state-by-state benefits from health care reform. The reports are supposed to show clearly how all Americans will benefit from reform. Frankly, I found several major errors of omission in the Kentucky report, so I imagine other state reports are likely flawed as well. Carefully read through the sources "cited" and you will find that lots of the "facts" are extrapolations or based on very limited reference points.

The report shows that premiums for Kentuckians have risen 61% since 2000. This is provided as a "shocking" number to illustrate that the current system is simply out of control. What the report leaves out is that Kentucky has been struggling since the last attempt at health care reform which was made by former Kentucky Governor Brereton Jones. During the time of "Hillary Care," Kentucky decided to move forward with many of the health care reform initiatives and like Congress seemed to attempt, he pushed it all through the legislature in a special session that was touted as solving a crisis that could not wait. The result is an insurance system where people in Kentucky pay higher premiums than those in surrounding states.

This leads to my second "shocking" number in the Kentucky report. The report states that 51% of Kentucky's insurance market belongs to one company. The report adds that under reform Kentuckians will have many more choices. The omission is that prior to the Jones reform effort, Kentucky had a much more robust market with hundreds of insurers serving the state. The reform effort forced them to leave Kentucky because they could no longer afford to do business here. It is true that we have very few insurance options in our state "post-reform," so I and many Americans remain concerned about the impact of national reform.

I think everyone agrees that there are some changes that could be made to our system. It is certainly far from perfect. However, when have we completely turned a system on its ear and labeled it is as a disaster when 85% of the people being served are satisfied?

Here is the quote from Sebelius on the release of the reports:

"These reports show how health insurance reform will help Americans save money, get better care, strengthen their insurance if they already have coverage, and afford it if they don't. Every American will benefit when we pass health insurance reform."

I hope everyone notices that we are no longer pursuing "health care reform" but rather "health insurance reform." As someone who has worked in a state where "health insurance reform" has happened, we need to tread cautiously or the nation will end up with the high costs and lack of choices that have plagued Kentucky since we drank the "reform" kool-aid the last go around.

The reports are available at http://www.healthreform.gov/healthcarestatus.html.

CoalTek Tour in Calvert City Shows off new Technology

2009-08-03T16:15:00.003-04:00

Sometimes the most interesting technology is going on right in your back yard and you don't even know it.

I went with several state legislators on a tour of a coal processing and blending facility, CoalTek, in Calvert City Kentucky, which produces cleaner and more efficient coal for power plants and other end users. It's the only facility of its kind in the world.

The coal arrives by rail, is crushed for some applications, and then processed by a large microwave oven and formed into briquettes (again, for certain applications). The processed coal has up to 40% more energy per unit of weight than the raw coal. They blend several different types of coal together to reduce the amount of sulfur and other environmental constituents found in Eastern Kentucky coal, for example by blending it with processed Powder River Basin coal from out west, which is low in sulfur.

The technology is scalable and flexible in terms of location. It can be easily placed at the mouth of a mine or at the generator. Because it is a microwave, it is a very efficient process, but certainly the power used in the process is something to consider. There are two main advantages to the process.

1) It produces coal with less moisture at consistent levels, which increases the efficiency of producing the energy and means power plants don't have to continually adjust for disparate ranges in moisture in the coal during the process, thereby increasing the efficiencies of the parasitic processes required to make run the generator.

2) By increasing the BTU capacity from around 8,500 BTU's to 11,200 BTU's, the power plant has the option to burn 30% less coal to produce the same power.

That's good news for both the power-producing plants and consumers.

While this technology can be used to upgrade low energy Western coals, it can (and is) also applied to a broad range of other fuels to achieve targeted improvements in energy efficiency, environmental quality, handling quality, etc. CoalTek is also working on projects to improve the quality of locally available waste coal fines, to solve the coal ash/waste slurry impoundments issues, and upgrading a variety of coals used in the steel manufacturing process (anthracite, metallurgical coal). For more information you can contact Rolando Sanz-Guerrero at rsg@coaltek.com. Rolando is CoalTek's VP of Marketing and will be able to answer more detail questions about CoalTek and its technology.

“SMART GRID" Technology - The Jetson's approach to energy conservation

2009-08-03T15:56:00.001-04:00

Another component of the energy solution is the development of a “Smart Grid”. So what is a “Smart Grid”? Well the idea is to take digital technology and apply it to the electrical transmission grid. It will be like the digital cable boxes that you hook up to your television and receive “on demand” movies. Basically, the new digital technology will allow two-way communication via that big transmission grid, which brings electricity to your home.

Jim Roger’s, CEO of Duke Energy, told a large crowd at NCSL recently that after extensive review, polling and research he believes the new “smart” technology will need to work in the background, in order to be effective. When he says, “work in the background”, he means the technology will work in a way that requires little human interaction. He explained most people only think about electricity only when they flip a switch and the light doesn’t come on. He contends if consumers are asked to understand why their usage patterns must change to conserve electricity and what changes have to be made, they will become frustrated and not take the necessary steps required. But if the changes can be made in the "background," as he describes, then two-way communication between the source of the electricity and the smart “gadgets” in our homes, will allow the necessary changes to be made automatically.

What are these “smart” gadgets? You might have appliances that are interconnected so that when one is on the other one shuts itself down. For example, when the dishwasher is running the refrigerator will not cycle as often. Or the refrigerator will automatically increase its thermostat by two degrees during peak electricity demand times. Washing machines, dryers and dishwashers can be scheduled to run at the time of day when there is the least amount of demand on the grid. Most people do not understand that electricity is far cheaper to deliver at 3:00 am than it is at 3:00 pm. Smart technology can help ensure that your home is making the best use of the electricity available.

According to extensive polling done by Duke Energy, Mr. Rogers said only 10% to 15% of the public makes electricity-purchasing decisions based on the environmental impact. These are the folks that will want an app on their iPhone that allows them real time access to monitor their “smart meter” from anywhere in the world.

He argues, this “Smart Grid” technology is critical for the average consumer. These new “smart meters,” which are currently a rarity in Kentucky, can be used as a dramatic teaching tool. The “smart meters” can tell you in real time how much electricity you are using and how much that electricity is costing. These devices are designed for the budget conscious. An individual may not understand using less electricity decreases the impact on the environment, but with a "smart meter" they will see that using more electricity is going to take more of their income."

The new “Smart Grid” technology can also send signals back to the source of the electricity generation, giving power companies a signal that could indicate a potential outage. Power outages may potentially be avoided altogether.

There is tremendous potential for this new technology, but there are some concerns, as well. Cyber security is one of the most important. We all know computer hackers are lurking behind every web page and with this new technology they will be lurking behind every meter. The developers, energy companies and regulators are all focused on this critical area. It is also important that utility rates are structured so that utility companies have an incentive to invest in these types of technologies. And finally, these new technologies need to incorporate future changes in electricity production, such as individual solar panels, the development of electricity storage devices and/or facilities and other developments that are only a glimmer in an engineers eye right now.

The “Smart Grid” technology can make a difference at the individual level, and after all, that is where the rubber meets the road, or the electricity meets the switch, so to speak.

What is Carbon Sequestration?

2009-07-22T15:09:00.002-04:00

The “signature issue” of our time is requiring the private sector, public policy makers, government research programs and individuals to look at the issue from a different perspective. Today at the NCSL conference in Philadelphia there was a forum dedicated entirely to the issue of carbon sequestration. Unlike so many terms used today, this actually says pretty much exactly what it is. Basically, you capture the carbon that is a by-product of burning coal, contain it, and then inject it into the ground. Okay the ground is a loose term. Actually the idea is to inject the CO2 safely and economically into geologic formations far below the earth’s surface, which will be used as a large permanent storage facility.

So why is this important? Well, it is widely believed that carbon dioxide is a major contributor to the global climate change. While there is still discussion around this issue and the contribution human advancement has played, it is clear that this is going to be addressed by policy makers.

Today, the discussion at NCSL centered on the development and regulation of this technology. The U.S. Department of Energy, the Office of Fossil Energy and the National Energy Technology Laboratory have been working on the development and deployment of this CO2 solution. In addition, private concerns and universities are devoting research dollars and time to the development of this technology. Why? To ensure the future of fossil fuels as an energy source.

The Department of Energy has been working on this initiative since 1997 and today said that based on the progress they are making with projects across the country they believe the technology will be available for commercial deployment by 2020. By 2020? Wait a minute, Congress is considering “cap and trade” legislation today. While the implementation date is still a moving target most believe if the legislation is passed Kentucky consumers will have to buy credits, expensive credits, long before 2020. This means that the cost of consuming coal-based electricity will have to increase and the increase will be significant. That is the purpose of “cap and trade”, create an economic disincentive to use carbon-based fuels.

Many of the supporters of “cap and trade” come from states that have abundant non-carbon based electricity. For example, hydro power and nuclear are non-carbon based sources of electricity. States like New York, Oregon, California and Idaho will actually make money on the “cap and trade” program. That means while Kentucky consumers’ electricity bills increase, there will be a transfer of wealth to other states. New York, California and other states will see a big influx of Kentucky, Indiana, Illinois and Ohio’s money in order to facilitate those decreases.

So what does all this mean? Well, I will just remind you again that Lisa Jackson, the EPA administrator, told a congressional committee recently if we do everything in the current “cap and trade” legislation and China and India do nothing there will be no impact on global warming. So for now all we will do is redistribute the wealth and force some large consumers of electricity such as aluminum smelters, steel plants, paper mills and automotive plants to go out of business in Kentucky. And those jobs will move to, probably India and China. And of course, we will see our coalmines reduce production and eventually close.

There is still more information to come on this important issue. If you would like to follow me on Twitter you can find me under the user name “melodieshrader”.

We Need to Encourage Energy Efficiency

2009-07-20T19:13:00.005-04:00

Energy Secretary Ken Salaza, called reducing green house gases “the signature issue of our time” at today's NCSL Energy Policy Summit on Energy Efficiency. The day has been full of good speakers and important information, but the most important lesson learned today was investing in energy efficiency costs less than producing a new kilowatt hour of electricity. In other words, significant strides can be made in stabilizing the world's output of green house gases by developing and deploying energy efficient technology in the United States and across the globe. The United States could easily reduce the need for additional power plant production by focusing on retrofitting buildings and requiring a higher standard of energy efficiency in all new construction. Wow! There’s something we haven’t heard a lot about in the recent discussions in Washington. Yes, it’s there. And there were funds in the stimulus package to encourage movement in this area. But we would have to see a complete public policy overhaul to force a move in this direction.

Let’s define energy efficiency for the purpose of this discussion. Energy efficiency is doing the same amount of work with less energy. Energy conservation on the other hand is actually doing less work with less energy. In other words, we can replace a gas furnace with a new geothermal unit and keep the house at the same 72 degrees with less energy. Or we can turn the thermostat back to 65 and reduce the amount of energy we use. If done consistently, both would reduce the need for existing energy resources but one requires a cash outlay for the new technology and one requires us to be uncomfortable. An incentive is required to push adoption of either.

Did you know that your house causes twice as much pollution as your car? In 2007 the average utility growth rate was approximately 1.5%. It is this growth rate that drives the need for new power plants, more natural gas exploration and the building of nuclear power plants. Some experts say that broad scale adoption of an energy efficiency program for our buildings alone could reduce our overall energy needs by 30%. Chris Mathis, President of MC2 Mathis Consulting, quoting the Department of Energy, said that a 30% improvement in the efficiency of the all the buildings in the U.S. would reduce energy bills by $75 billion in 15 years and eliminate the need for 80 new nuclear plants over the next 20 years.

So how do we increase energy efficiency in our buildings? We increase the level of insulation, install better windows, seal our air ducts, install heat pumps and geo-thermal units, replace old light bulbs with new CFL’s. And we invest in performance testing. A public policy that encourages these behaviors will create jobs. Local jobs. Jobs that cannot be shipped overseas.

Chris Mathis goes on to say that for the price of one nuclear power plant you could increase the energy efficiency of every home in North Carolina (4 million homes at a cost of $5,000 - $10,0000 each) and decrease the demand for 4000 megawatts of power. That is the equivalent of two nuclear plants or twenty 200 megawatt coal fired plants.

There was a lot more information given today on various programs and public policies that focused increasing our energy efficiency. Over the next few days I will be posting additional articles and links to encourage an ongoing discussion. If you would like to receive live tweets from the conference on this issue, follow me on twitter. My user name is melodieshrader.

We need Clean Affordable Kentucky Energy

2009-07-19T19:13:00.003-04:00

The answer is “All of the above”. Thank goodness the answer is simple because understanding the question is so complicated you must learn a whole a new vocabulary. The question? What does the United States need to do in order to reduce global warming, reduce our reliance on foreign oil, and transition to a clean energy economy?

While Congress is off in Washington debating this very issue, many Kentuckians set their thermostat to a comfortable temperature and go off to their job. In our area of the country, many of those jobs rely heavily on affordable electricity. If you work at an aluminum plant, a paper mill or a steel plant you need to understand the impact this legislation will have on your future employment. Actually the energy bill being debated now, whether you work in one of those industries, on a farm or rely on social security, will impact every household.

Kentuckians have enjoyed low electric rates and the jobs that those rates have brought to the Commonwealth. Those jobs will be in jeopardy. Coal, a major economic resource in our state, will be negatively impacted by this “cap and trade” legislation.

While there is still debate about the severity of global warming and what can be done to reverse its impact, there is a great deal of agreement that reducing environmental pollution and becoming an energy independent nation would be a positive step. SO, if your job is going to be lost don’t you think the legislation should actually make considerable progress toward these important goals? Yet, Lisa Jackson, the United States Environmental Protection Agency Administrator, said last week, if the United States acts alone, the measures in the legislation currently being considered will have no impact at all on global warming. Why? Because China is now a great emitter of carbon and other harmful pollutants than the United States. China does not meet the United States current standards for burning coal, and while they are bringing new power plants on line every day to meet their growing needs, they have made it clear, they will not increase their clean air standards. However, they are happy to take all of our aluminum, steel and other electricity intensive jobs that we care to send to them.

Secretary Ken Salaza, Secretary of the Interior, called this issue, “the signature issue of our time.” I agree. And every citizen of the Commonwealth needs to understand that a quick Washington fix is not going to reverse global warming, but it will impact our standard of living much sooner than you may anticipate.

So the answer, “All of the above” means we have a lot of work to do. We have to invest in clean coal technology. We must demand cars that get better gas mileage or use alternative fuels. We need to make our homes more energy efficient. And as a country, we must spend the time, talent and resources to develop new technology that can make us a more energy independent country. And always remember, the cheapest way to decrease your “carbon footprint” is to never waste any of our energy resources. Turn off the lights. Car pool. Purchase energy efficient appliances.

Every Kentuckian needs to understand the impact that the “clean energy” (cap and trade) legislation will have on them and their family. It is important to your future. Remember the answer is "All of the above".

Palin Steps Down

2009-07-03T16:57:00.002-04:00

Sarah Palin has just announced that she will step down as Governor of Alaska at month's end.

Her resignation means that the Lt. Governor will serve the balance of her current term. Many were anticipating that Palin would not seek another term, but I think most were shocked at her decision to resign prior to completion of her current term.

Palin cited the huge personal legal bills and the stress of media attacks on her family as part of her decision making process. Palin also noted that she didn't want to be a lame duck Governor after announcing she would not seek another term.

Political pundits are all trying to make sense of this decision. Several speculate that Palin may be taking a page from Ronald Reagan's political playbook. Reagan decided not to seek another term as Governor of California. He then used the time to mount his presidential campaign. Essentially he campaigned from 1976 until his election in 1980. Only time will tell if Palin will make another run at office.

HHS Rescinds Medicaid Regulations

2009-06-30T14:17:00.003-04:00

Here is the press release detail from HHS:

Department of Health and Human Services (HHS) Secretary Kathleen Sebelius today announced that the administration will rescind all or part of three Medicaid regulations that were previously issued and delay the enforcement of a fourth regulation. Each of these rules, in whole or in part, had been subject to Congressional moratoria set to expire on July 1, 2009.

"These regulations, if left in place would have potentially adverse consequences for Medicaid beneficiaries, some of our nation's most vulnerable people," said Secretary Sebelius. "By rescinding these rules, we can expect that children will continue receiving services through their schools, beneficiaries will be able to access all available case management resources to help them better manage their health care, and outpatient hospital and clinic services can continue to be covered in the most efficient manner."

"The actions we are taking today are necessary to ensure that the states have the flexibility they need to fully serve Medicaid-eligible individuals," said Secretary Sebelius.

The Centers for Medicare & Medicaid Services (CMS) and HHS today are:

* Rescinding a final rule, published December 28, 2007, that would have eliminated reimbursement for school-based administrative costs and costs of transportation to and from schools. The rescission reflects concern that the rule could limit the Medicaid administrative outreach activities of schools, and that the overall budgetary impact on schools could potentially impact their ability to offer Medicaid services to students.

* Rescinding a rule, published November 7, 2008, that would have limited the outpatient hospital and clinic service benefit for Medicaid beneficiaries to the scope of services recognized as an outpatient hospital service under Medicare. This rule was rescinded because CMS became aware that coverage beyond that scope could not be easily moved to other benefit categories, resulting in great impact than previously anticipated.

* Rescinding provisions of an interim final rule published December 4, 2007, which would have restricted beneficiary access to case management services. These provisions appeared to, in practice, restrict beneficiary access to needed covered case management services, and limit state flexibility in determining efficient and effective delivery systems for case management services.

* Delaying until June 30, 2010, the enforcement of portions of a regulation that clarified limitations on health care related tax programs so that CMS could determine whether states need additional clarification or guidance. CMS may also further review the potential impact of the regulation, and give additional consideration to alternative approaches.

Olmstead Issues Plague Kentucky Medicaid: DMS Being Investigated For Possible Civil Rights Violation

2009-06-26T23:40:00.010-04:00

The Olmstead decision is haunting Kentucky Medicaid once again. After years of discussion and various stops and starts, the Kentucky Department for Medicaid Services (DMS) finally got its Consumer Directed Option (CDO) program up and running. Now the integrity of the CDO program is being called into question. HHS is investigating DMS for a possible civil rights violation in the the way CDO benefits are provided. Medicaid cut recipient James Reed's annual CDO budget by $36,000 at the beginning of 2009. James is autistic, bipolar, and mentally handicapped. He had previously been institutionalized and the CDO option allowed his mother and father to keep him at home. But his parents are getting older, and the budget cut from DMS forced them to nearly double the amount of time they had to care for James alone. Mrs. Reed is disabled herself and concerned that she and her husband may be forced to put James back into an institution if they are unable to provide the additional 40 hours of care themselves. Mrs. Reed said that during James' prior institutional stays he was physically and sexually abused, and that two of the institutions he stayed in have been shut down due to problems.

The Reeds argue that DMS is violating their son's rights under Olmstead. In 1999 the United States Supreme Court handed down a landmark decision that has come to be known as the Olmstead case. Essentially the court said that the unnecessary institution of individuals with disabilities constitutes discrimination under the Americans with Disabilities Act. Justice Ruth Bader Ginsburg delivered the court's opinion stating, "Under Title II of the federal Americans with Disabilities Act, states are required to place persons with mental disabilities in community settings rather than in institutions when the State's treatment professionals have determined that community placement is appropriate, the transfer from institutional care to a less restrictive setting is not opposed by the affected individual, and the placement can be reasonably accommodated, taking into account the resources available to the State and the needs of others with mental disabilities."

Thus it seems to me that the civil rights investigation will hinge solely upon the last sentence. The placement must be reasonable considering the resources available to the State and the needs of others with mental disabilities. DMS may argue that in light of the state's $1 billion budget shortfall, cutting James' CDO budget was a reasonable course of action to ensure that the needs of all recipients could be addressed. This argument may seem weak, however, since Kentucky received a significant increase in its federal match rate thanks to the stimulus package. The match rate increased from approximately 70 cents on the dollar to nearly 78 cents, which means big savings for Kentucky. Rather than having to put up $.30 in state money to draw down a dollar, only $.22 is needed. The result is a savings of $.08 for each dollar spent in Medicaid. Considering that spending in the Medicaid program is expected to top $700 billion in SFY 2010, HHS may decide that the best way for Kentucky to use the stimulus money is taking care of its most vulnerable citizens in their homes.

HB 2 Fails in Senate A&R

2009-06-22T21:57:00.003-04:00

The Senate Appropriations and Revenue Committee heard HB 2, the "video lottery terminal" bill. The VLT bill would have allowed slots at Kentucky's horse racing venues. The committee rejected the measure in a 10-5 vote. It is still possible that some help for the horse industry may be available as part of the special session. Senate President David Williams has put forth another measure aimed at increasing purses and breeding incentives for Kentucky's signature industry. Democrats still feel that the gaming bill would have provided the level of funding needed to assist the industry as well as increase revenues to the Commonwealth. Governor Beshear has issued a statement lamenting the bill's failure to pass.

A snapshot of the British health care system and its key downfalls

2009-06-17T23:12:00.003-04:00

This is the second post in a look at the use of rationing, or as we now say "comparative effectiveness." This is a brief discussion of the single payer system in Great Britain and some of the key issues that system creates in terms of access to quality care. In Great Britain health care spending is pretty low (7.5% of GDP) but that amount is evenly distributed amongst its citizens for the most part. Rationing and long waits for treatment are cited as the main drawbacks to the British single payer system. In Great Britain everyone is insured and nearly 10% have private insurance that affords additional benefits such as reduced wait times and easier access to care, particularly specialists. Health care providers are mostly government employees and therefore work the same schedule as your typical bureaucrat. In other words, unless you are sick between the hours of 8am-5pm on a weekday, your care options are quite limited. Due to this scenario and the low compensation paid by the government, specialists are few and far between. In fact, choice of primary care provider is limited and generally only patients waiting very long periods (six months for those in London) can have more options for choosing their provider. Waiting times to receive care are tremendously long compared to the standard of care in the US. For example, at any given time there are over 750,000 citizens waiting to be admitted to a hospital for care. There are minimum wait times for most services that patients must meet. Often these wait times can exceed the patient’s life expectancy based on their particular illness. Nearly 40% of cancer patients are never able to see an oncologist. Those of advanced age may be denied treatment altogether for many conditions. This rationing of care is what Americans need to be cognizant of when evaluating single payer governmental based coverage. Sure, there are upsides such as low or no copayments, eye care coverage, and dental coverage. However, we need to focus on the problems with systems like that in Great Britain so we don’t make the same poor choices.

The Medicaid Prescription Drug Rebate Equalization Act (DRE) can give struggling states some relief

2009-06-17T13:07:00.004-04:00

State Medicaid programs are able to access significant savings on the cost of drugs for beneficiaries thanks to a federal law that requires that rebates be offered before a drug can be used in the Medicaid program. Today 64% of the Medicaid population in the U.S. is in a managed care program. Unfortunately the law that allows these Medicaid pharmaceutical savings to be achieved doesn't apply to managed care organizations. The law currently requires that the drug rebates be offered only in the traditional fee-for-service Medicaid programs administered by the states, leaving managed care organizations at a serious disadvantage. Rep. Bart Stupak (D-MI) wants to level the playing field with H.R. 904, The Medicaid Prescription Drug Rebate Equalization Act (DRE). The bill will ensure that the same rebates are provided on all drugs purchased for the Medicaid program, whether by a state program or a managed care organization, for significant savings to both state and federal governments. The Lewin Group's analysis of the DRE estimated that the federal government would save more than $7 billion and states would save $5.5 billion over the next 5 years. In a difficult economy that is forcing the Medicaid rolls higher and higher, it makes sense to grab every savings opportunity we have.

To learn more about the DRE or read the full text of the bill, follow this link: http://www.govtrack.us/congress/bill.xpd?bill=h111-904

So the "Stimulus Plan" didn't work out as planned, but we should trust in health care reform?

2009-06-16T19:24:00.003-04:00

Vice President Joe Biden's take on the infamous "stimulus package" is that it has not quite worked out as planned. He notes that it looks like the millions of jobs that were to be created was an overestimate. In the end it looks like around 600,000 jobs might result from the stimulus by the end of the summer. To see some of his quotes, please go to http://thepage.time.com/key-quotes-from-biden-on-the-stimulus/

This clearly looks like a miscalculation on the part of the federal government. Can anyone say unintended consequences?

Now, let's flash forward to the present government "priority" -- health care reform. Is anyone perhaps concerned that like the stimulus package, the health care reform package might not work as intended? I know I am.

House A&R Passes HB 3 and HB 4

2009-06-16T15:33:00.004-04:00

House Bills 1 and 2 (VLT bill and budget bill) have been assigned to the House Committee on Appropriations and Revenue. Chairman Rand has not yet called the bills, however, he promised the committee members as much notice as possible before they are discussed.

Here are summaries of the two bills that passed out of committee earlier today:

HB 3—Economic Development and Incentives bill

Rep. Thompson

- Committee Substitute—concerns were raised about the wage assessment with “enhanced and non-enhanced counties.” The percentages have been lowered to reflect pending rises in the federal minimum wage. Committee Substitute was adopted.

- The provisions of HB 229 (2009 regular session) are the core of this bill:

o Additional assistance to “existing businesses” within Kentucky—to “help them retool”

o Continuation of the Metro College program (UofL and UPS)

o Streamlining existing incentive programs

o NASCAR Legacy provision

o UK—permit the University to pursue private dollars for arena and stadium enhancements

o TIF changes—extend terms for Transpark; amend definitions for Georgetown arena development; lower threshold for “signature TIFs.”

- Allow for Breeders Cup incentive

- Small business Tax incentive (Rep. Pullin’s bill)

Permit building of and incentives for Hardin County advanced Battery manufacturing facility

- Tax credit for “short line railroad” improvements and upgrades

HB 4—Public Infrastructure Authority bill

Rep. Pasley

- This is the latest version of the Public Infrastructure Authority bill—similar bills have passed both this Committee and the House in previous sessions. The bill will allow Kentucky to authorize “mega-projects." Currently, $13 billion in such projects are underway without a clear source of payment. This point has been supported by Transportation Secretary Prather.

- “The main goal of this legislation is to keep the debt off of the state.”

- The bill would create a “perpetual” statewide authority to oversee projects—whereas individual project authorities will cease to exist after the project is completed, the statewide authority will exist in perpetuity.

- Provisions:

o The projects have to be “mega-projects”—defined in federal statute as being larger than $500 million

o They can employ tolls

o Projects have to connect to existing roads and fit within the General Assembly’s 6 Year Road Plan

o Require annual audits, reports, ethics and procurement code compliances

Comparative Effectiveness

2009-06-16T13:53:00.005-04:00

Comparative Effectiveness is a term that the American public needs to understand. In the coming days and weeks, CST will be exploring this term and what it means for providers and consumers of health care. Champions of "health care reform" use the term to legitimize the denial of certain treatments, drugs, or procedures solely based on cost.

This is the politically acceptable term for rationing of services. In other words, the United States would be following in the steps of Canada and several European nations that make life and death health care decisions based solely on a cost/benefit analysis. (As a side musing, I find it ironic that the people pushing this approach are the very ones who have opposed commercial health insurance because of accusations that coverage decisions are based solely on cost.)

Senior citizens should be particularly alarmed. In universal coverage nations the elderly are often denied life saving treatments due to the fact that they are advanced in age and the cost of treatment outweighs the individual's benefit to society. We as Americans don't have any sort of grasp on such an approach to health care. Unless we realize that spirited dialogue on real issues like comparative effectiveness is necessary and healthy, America will wake up with "unintended consequences" of catastrophic proportions.

Legislation limiting the use of "comparative effectiveness" research is being proposed by several Republican leaders. Senate Minority Leader Mitch McConnell (R-KY) and Senator Jon Kyl (R-AZ), joined by cosponsors Sen. Mike Crapo (R-ID) and Sen. Pat Roberts (R-KS) introduced S. 1259 on Monday that would prohibit the government from denying or delaying healthcare based on cost, by banning the use of "comparative effectiveness research." The legislation seeks to protect all patients by prohibiting the use of data obtained from comparative effectiveness research to deny coverage of items or services under Federal health care programs and to ensure that comparative effectiveness research accounts for advancements in personalized medicine and differences in patient treatment response.

Senator McConnell, in a floor speech yesterday afternoon warned that what Americans "don't want is a Washington takeover of health care along the lines of what we've already seen with banks, insurance companies, and the auto industry. Americans don't want a government-run system that puts bureaucrats between patients and doctors."

2009-06-16T13:28:00.001-04:00

It looks as though House A&R will be in for quite a while!

Link to Gaming Bill Detail

2009-06-15T23:41:00.000-04:00

HB2 (BR 41) -

Governor Beshear Addresses Joint Session of General Assembly in 2009 Special Session

2009-06-15T23:33:00.000-04:00

Tonight amid the roar of a fire alarm outside of the House chamber, Governor Beshear laid out his plan to bring the Commonwealth budget into balance for state fiscal year 2010. The foundation of his strategy is to enhance revenue and again decrease spending. Thoughtful use of stimulus funding also plays a key role in the Governor's plan. The Governor also emphasized once again that taxes would not be raised under his proposals.

In his intro to a proposal to bring additional revenue into state coffers, Gov. Beshear stated that Kentucky is operating on hand tools in a power tool age. He mentioned plans to bring NASCAR racing to northern Kentucky, business incentives and last but not least...gaming. This is his way to save our horse industry from the out of state powers drawing the equine business out of the Commonwealth. He noted that he could produce charts and graphs showing the positive impact of gaming, but he said that everyone was so well versed on this issue that there was no need. He also talked about several megaprojects such as the Louisville bridges. He reminded the chamber that for all intents and purposes the economic incentives bill was agreed upon last session and but for time constraints would have passed. He said that it is time for an up or down vote on gaming. With one in ten Kentuckians out of work we need new industries in the Commonwealth. He again asked the general Assembly to put aside partisan politics and come together to tackle this complex economic problem. He closed by talking about moments that bring life into focus such as watching over a sick child or the birth of a grandchild. He urged the General Assembly to make the tough decisions that lie ahead and focus on improving the economic condition of the Commonwealth.

Below is a brief detail of the Governor’s Proposals for the 2009 Special Session:

Budget proposal

• No new taxes on working families and Kentucky businesses.

• Preserves commitments to primary, secondary and higher education and maintains Medicaid funding through the use of federal stimulus dollars.

• Preserves funding for state police and local jails, as well as funding for prosecutors, public defenders and corrections.

• Requires enhanced government cuts through further reductions of other areas of government by 2.6 percent.

Video lottery terminal proposal

• Video Lottery Terminals (VLTs) would be administered and regulated by the Kentucky Lottery Corporation at approved tracks licensed by the Kentucky Horse Racing Authority.

• Minimum payout or handle returned as prizes would be 85 percent of the amount wagered.

• Track facilities would pay an initial application fee of $25,000 plus additional license fees of $360 million. Licenses would be for 10 years with subsequent five-year renewals.

• A significant portion of the revenue generated would be allocated to equine interests due to the current state of Kentucky’s signature horse industry.

• Revenues generated by VLTs would support tax relief for citizens through an individual income tax credit equal to 50 percent of the state property tax on motor vehicles, a savings of approximately $30 million to Kentucky taxpayers.

• Active duty military pay would be exempt from individual income tax, an estimated cost of $18 million, which would also be offset by VLT revenues.

• Some purchases related to the breeding, raising, training or transporting of horses would be exempt from Kentucky sales tax.

Economic incentives proposal

• Revises economic incentives statues to help existing businesses remain and expand in Kentucky and helps Kentucky lure major tourism development projects.

• Allows Kentucky to secure necessary funding for a proposed advanced battery manufacturing complex in Hardin County.

• The proposal was developed following months of consultation with legislators, local economic development organizations, site selection consultants and existing Kentucky businesses.

• Most of the proposal’s components were approved by both chambers during the 2009 General Assembly.

Megaproject proposal

• Establishes the Kentucky Public Transportation Authority (KPTA) to review and approve transportation projects eligible for construction and financing that connect Kentucky and Indiana.

• Authorizes the KPTA to facilitate construction and financing of transportation projects. The authority may issue project revenue bonds.

• Authorizes the establishment of bi-state authorities between Indiana and Kentucky to finance, construct and operate projects, subject to approval by the state authority.

• Allows the creation of financing authorities for other projects within Kentucky in addition to authorities to finance projects between Kentucky and Indiana

2009-05-20T12:58:00.001-04:00

I'm just checking in with our new blog from my iPhone. I am anxious to see how all this technology works together.