THE ECONOMY: Bypassing Health Care, Or So It Would Seem
A trio of articles last week from three very different locations -- Long Island, Florida and Southern California -- illustrated in three different ways how the health care industry is suffering economically, despite a record stock market and low unemployment. The St. Petersburg Times reports that stocks for the 16 for-profit companies comprising the Florida Health Care Index are down by 16% and the five stocks representing the nursing home sector are down 42%. The state Agency for Health Care Administration (AHCA) maintains a web site that tracks the stocks, accessible at www.fdhc.state.fl.us/st ocks. AHCA Director of Corporate Affairs John S. Noble said, "Historically, when companies have had significant financial problems, that's affected the quality of care and we've had to respond. We want to get in front of that curve" (Hundley, 9/13).
Florida's problems echo a national trend that finds many health care companies struggling to say solvent in the face of government mandates, fraud investigations and budget cuts. Newsday columnist James Pinkerton contends that mandates from the government requiring HMOs to provide certain coverage are directly responsible for driving up policy prices. "Across the country, politicians are piling more mandates on HMOs -- doesn't 'social justice' require that every oldster get his Viagra? -- and Congress, prodded by the president, is likely to enact a 'patients bill of rights' that will swing open the door even wider. Economics dictates what will happen next: The price of health care coverage will rise, and so the numbers of those covered will fall," Pinkerton concludes (Richmond Times- Dispatch, 9/12).
Struggling to Stay Afloat
Southern California is in trouble, too. A Los Angeles Times article takes a look at husband and wife doctor team Charles and Joan King of North Hollywood, whose practice includes many Medicare patients. Although they have practiced medicine for 30 years, the Kings may be forced to give up their practice. A few months ago, Transamerica Occidental Life Insurance Co., administrator for the southern California Medicare system, began denying them reimbursement for about 70% of their Medicare patients. The company claims that the Kings' documentation failed to justify the multiple hours they spent examining each patient -- some exams lasted two or three hours. The Kings contend, however, that such personal attention is necessary in order to "talk to them (patients) about what's happening and listen to them, [to] take care of [them as] a real person and call it medicine." Insurers' intense scrutiny of claims is part of an effort to curb Medicare fraud -- Medicare was paying $23 billion annually for improperly documented claims -- and to contain costs. In the end, though, it is patients that are hurt, says Joan King, insisting that such restrictions for Medicare reimbursement "have led to many specialists cutting exam times and failing to explain their diagnoses to patients" (Reich, 9/12).