Sunday, September 15, 2013

Who has jursidiction to prevent self-dealing?

Lots of people expressed dismay at my Friday report concerning the self-dealing between Neighborhood Health Plan and its owner, Partners Healthcare System.

The unanswered question, though, is which of the alphabet soup of state agencies has responsibility for this matter.  Who approved this?  Who can investigate it?  Who can change it?

It is definitely not the Center for Health Information and Analysis (CHIA).  Is it the Health Connector?  It is the Health Policy Commission? Is it the Executive Office of Health and Human Services? Is this a matter for the Attorney General's jurisdiction because of anti-trust issues?

I fear that Chapter 224 of the Acts of 2012, titled “An Act Improving the Quality of Health Care and Reducing Costs through Increased Transparency, Efficiency and Innovation,” has created a hodgepodge of jurisdiction that leaves no one in charge when this kind of thing happens.

Here's the pertinent background. As I quoted Julie Donnelly at the Boston Business Journal:

Partners HealthCare aims to drive new members to its newly acquired health insurer, Neighborhood Health Plan, by cutting off access to some doctors within new health plans offered under ObamaCare.

Neighborhood Health Plan is one of 10 insurers that has been certified to offer subsidized and un-subsidized ObamaCare plans through the state’s Health Connector.

But what Neighborhood Health Plan has is exclusive access to primary-care doctors at Brigham and Women’s Hospital and Massachusetts General Hospital.

This is a departure from Partners’ strategy in the past. Before its purchase of Neighborhood Health Plan, Partners’ offered access to its doctors to all of the health plans within the state-subsidized health plans that were launched under Massachusetts' own statewide health reform. 

Why does this matter?  Because the PHS doctors dominate the state.  With newly acquired South Shore Hospital, PHS has about 1258 primary care physicians in 16 groups, roughly 27 percent of the 4684 statewide total associated with groups.*  In a 2009 study prepared by its COO, PHS was shown to have about 850 of the 3700 primary care physicians in Eastern Massachusetts, or about 23 percent.**

* Data on provider networks and medical groups is derived from Massachusetts Health Quality Partners’ Massachusetts Provider Database. Approximately three quarters of all primary care physicians in Massachusetts are associated with a major medical group. The remaining physicians are either in very small practices or are licensed but not practicing.
** "Influence of Market Forces on Healthcare: A Case Study," April 9, 2009.


Anonymous said...

You know, I don't live in Boston, nor even in Massachusetts. But maybe it takes an outsider's eye to see that if MA doesn't grab this tiger by the tail, it is going to eat the state and all its good intentions for health. The more the state refuses to put its foot down, the more brazen the tiger becomes. It will be at your dinner table very soon.

nonlocal MD

Brad F said...

Ultimately though, wont subscription into plans come down to premiums in the exchanges.

Granted, the allure of Partners powerful, but will John Q Public pay $450 vs 325/mos if he can still access a quality network--albeit with common man bonafides?

Transparency can do certain things, and I will assume the state will harbor some interest in keeping choice in the marketplace. Yes, a crap shoot, but an overpriced product may backfire.

If we have learned anything, folks become exquisitely price sensitive, even with their healthcare.


Paul Levy said...


In this case, John Q generally will not pay the premiums because these are the government-subsidized plans.

Also, there is no guarantee that these plans will be more expensive than those offered by other insurers. PHS can offer discounts to its own insurance company that it does not have to offer to the marketplace as a whole.

Brad F said...

My response would be:
1) seeing as plan subsidies pegged to 2nd lowest silver plan, PHS still may not get a pass

2) beneficiary uptake into the xchanges seems inevitable as rules allow larger businesses to participate. assuming they succeed, the "inside vs outside" xchange route will take a lesser role with time. not a long term winning strategy--myopia that is.


Dennis Byron said...

"It is definitely not the Center for Health Information and Analysis (CHIA). Is it the Health Connector? It is the Health Policy Commission? Is it the Executive Office of Health and Human Services? Is this a matter for the Attorney General's jurisdiction because of anti-trust issues?"

Isn't it the Department of Insurance?

Paul Levy said...

Maybe. Good suggestion.

Anonymous said...

Taxpayers will pay more.

Partners has focused this initiative on SUBSIDIZED PLANS.

Masshealth - massachusetts medicaid plan, is fully subsidized. Consumers of these plans are not making choices based on financial impact on them. They decide based on other factors, like the "PRESTIGE" of the hospital and physician group. So the additional cost of Partners community physicians and hospitals, is paid by Federal and State taxpayers since health consumers have "NO SKIN IN THE GAME".

The same is true to a lesser degree in other subsidized plans in Commonwealth Care. Subscribers to these plans can be almost fully subsidized like those on mass health, or have lesser subsidies, But TAXPAYERS ARE ON THE HOOK, and help make these patients impervious or less amenable to price pressures.

This needs investigation by Federal and State anti-trust officials and Coakley's office.

Anonymous said...

YOUR Friday report? The move was reported by Julie Donnelly at the BBJ, remember?

Paul Levy said...

Yes, as I have clearly said both times. But people responded to me after I reported.

Anonymous said...

I Googled the press releases from the Partners - Neighborhood deal which took place about one year ago.... amazing that they paid practically nothing for the plan other than some grants to community health centers that were tied in with Neighborhood. There are a lot of statements about how Partners would not use the insurance license in a way that sounds very close to what they are now proposing. Only one year after the deal that the state and feds allowed to happen and Partners is already changing the rules of the game with their insurance license. I doubt anyone will step in on all of this... other than the wonks on sites like this people don't even understand the issues and how big they are. Look at the South Shore deal... how they propose adding that hospital system to Partners and do it with a straight face is beyond me. I guess it's easier to go after the loser systems like Steward and guard against the evil "for profit" system that, ironically, is not making any profit at all.

Anonymous said...

did you see the article by Julie Donnelly of Boston Business Journal. A mea culpa.

Said Partners didn't choose to exclude others but was forced out of the other non-NHP plans because they were too expensive.

Paul Levy said...

Thank you. I'll update this soon.