Saturday, December 14, 2024
Friday, December 13, 2024
American's Health Care System: Driven By Profit, Not Patient Care
In 2010, a private-equity firm called Cerberus Capital Management, which is named for the three-headed dog that is said to guard the underworld, bought six Catholic hospitals in Massachusetts and christened the chain Steward Health Care. The state’s attorney general blessed the deal on multiple conditions, including that, during a five-year review period, the hospitals stayed open and their workers stayed employed. A few months after the period ended, however, Steward started selling the land on which the hospitals stood. A $1.25-billion-dollar deal, in 2016, helped to finance more acquisitions. Many facilities, asked to pay rent on land they’d previously owned, struggled.
According to a recent report published by Massachusetts Senator Ed Markey’s office, which covers the period between 2017 and 2024, some Steward facilities had to forgo key investments in staffing, surgical equipment, elevator repairs, and even clean linens. Patients increasingly languished in emergency rooms; many left without receiving care; and mortality rates for common conditions climbed sharply. . . . . A hospital in Florida developed a bat infestation, and another, in Texas, was cited for placing potentially suicidal patients in rooms with materials with which they could hang themselves. Employees at Steward’s Carney Hospital, in Massachusetts, began calling their workplace “Carnage” hospital.
In May, Steward filed for bankruptcy. It has closed two hospitals and plans to sell thirty-one others. Steward’s C.E.O., Ralph de la Torre, who in 2011 purchased a forty-million-dollar superyacht, was subpoenaed by a Senate committee but failed to show up; he was held in contempt of Congress and resigned from his position. . . . . Nonetheless, Cerberus realized a profit of seven hundred and ninety million dollars from its investment in Steward.
Meanwhile, in some places in the U.S., private-equity firms now own more than half of all medical practices within certain specialties. “We are being picked clean by private equity,” a New Jersey-based radiologist said at a recent meeting of the American Medical Association.
2024 was arguably the year that the mortal dangers of corporate medicine finally became undeniable and inescapable. A study published in JAMA found that, after hospitals were acquired by private-equity firms, Medicare patients were more likely to suffer falls and contract bloodstream infections; another study found that if private equity acquired a nursing home its residents became eleven per cent more likely to die. Although private-equity firms often argue that they infuse hospitals with capital, a recent analysis found that hospital assets tend to decrease after acquisition. Yet P.E. now oversees nearly a third of staffing in U.S. emergency departments and owns more than four hundred and fifty hospitals.
Erin Fuse Brown, a professor at the Brown University School of Public Health, told me that private-equity firms have learned that they “don’t have to make things better or make them more efficient. You can just change one small thing and make a ton more money.” They are hardly the only corporations to learn this lesson. Increasingly, health insurers, private hospitals, and even nonprofits are behaving as though they aim first to extract revenue, and only second to care for people. Patients often are viewed less as humans in need of care than consumers who generate profit.
In 1873, Mark Twain co-wrote the novel “The Gilded Age: A Tale of Today,” which satirized an era that was marked by inequality, greed, and moral decay but was painted in a veneer of abundance and progress.
New technologies and treatments sustain the impression that patients have never been healthier, but corporations and conglomerates wield immense power at the expense of the people they’re meant to serve. Welcome to the Gilded Age of medicine.
In recent years, health-care corporations have embraced an approach that can only be described as gamification. In the U.S., all seniors over sixty-five are entitled to health insurance through Medicare, and, for several decades, private companies have offered plans through programs such as Medicare Advantage. The government pays insurance companies a fixed sum based partly on how sick those patients are. The sicker the patients, the bigger the potential payments. But who’s to say, really, how sick a patient is? Let the games begin.
This year, the health-news site STAT revealed that UnitedHealth, the country’s largest private insurer, had set up dashboards for practices to compete on how many conditions they could diagnose in patients. Doctors who completed the most appointments with seniors in Medicare Advantage were eligible for ten-thousand-dollar bonuses, and patients were offered seventy-five-dollar gift cards for getting checkups at which their medical histories could be recorded.
These strategies rack up so many additional diagnoses that, in 2023 alone, the federal government made $7.5 billion in “overpayments” to insurers, according to the U.S. Office of the Inspector General. Insurers are “pouring tremendous resources into developing the capacity to code patients in a way that nets more money from Medicare,” Donald Berwick, a former head of the Center for Medicare & Medicaid Services, told me. “That’s taxpayer money being siphoned away from people who need it.”
Berwick said that his own physician’s practice had recently been acquired by UnitedHealth. One day, he asked his doctor, “Anything different now?” “Two things,” the doctor replied. “I have to see more patients each day. And my patients have new diagnoses that I didn’t put there.” . . . . It did, however, generate higher payments from Medicare. Ask not what your insurer can do for you—ask how much revenue you can generate for your insurer.
The insurance companies in Medicare Advantage tend to argue that they’re simply recording diagnoses, not making them up . . . . But according to the Medicare Payment Advisory Commission, a nonpartisan agency that counsels Congress, private Medicare Advantage plans will cost the federal government eighty billion dollars more per year than if those patients had been in the traditional Medicare program. “You might as well flush most of that eighty billion dollars down the toilet,” Berwick told me.
On December 4th, after I drafted this piece, Brian Thompson, the C.E.O. of UnitedHealthcare, was fatally shot in midtown Manhattan. In the days that followed, the public response was not just one of shock but also of frustration and even rage against the health-insurance industry. . . . . Thompson had become a symbol of a broken system; people who devalued his life, it seemed to me, were engaging in a version of the dehumanizing behavior that they found objectionable within the health-care industry.
It would be nice if nonprofit health care were the antidote to corporate health care. Instead, each year, it seems to look more like for-profit medicine. The Times recently reported that Providence, one of the nation’s largest not-for-profit health-care organizations, sicced debt collectors on poor patients who were entitled to free care. Providence, which was founded in the eighteen-fifties by nuns committed to “serving all, especially those who are poor and vulnerable,” recorded annual revenues in excess of twenty-seven billion dollars in 2021. Like other nonprofits, it benefitted from enormous tax breaks, yet only one per cent of its expenses went to charity care. . . . . other hospitals still have policies of suing patients, obtaining court orders to garnish their wages if they fail to pay, and even placing liens on their homes.
Meanwhile, an increasingly consolidated health-care industry has engendered the kinds of too-big-to-fail behemoths that can single-handedly paralyze the system. Health care accounts for more than seventeen per cent of the U.S. economy, or around four and a half trillion dollars, but the revenues of just two companies—CVS/Aetna and UnitedHealth—account for nearly one in every seven dollars the nation spends on health care.
It’s not that any talk of money should be rejected—hospitals and clinics need to keep the lights on, after all. But we need counternarratives to revive medicine’s social contract and to help curb the kind of financial gamesmanship that has become accepted and pervasive.
Thursday, December 12, 2024
Wednesday, December 11, 2024
Trump Gears Up to Cut Social Security and Medicare
There are a thousand election hot takes and post-mortems floating around these days and I'm sure we'll soon come to some consensus about what drove the Trump victory (now down to a whopping 1.48% margin and shrinking.) But if there's one thing we do know it's that he won both of his elections at least in part by shedding some Republican Party orthodoxy that had been bringing the GOP down for ages. He knows a third rail when he sees one.
And if there's one issue that differentiated Trump from other Republicans from the minute he came down that golden escalator it's his promise to preserve the so-called entitlement programs. . . . . "I'm not going to cut Social Security like every other Republican and I'm not going to cut Medicare or Medicaid," and it may have been the key to his success in that first campaign.
He lied. His proposed budgets cut the programs every year he was in office. As Vox reported back in 2019:
Over the next 10 years, Trump’s 2020 budget proposal aims to spend $1.5 trillion less on Medicaid — instead allocating $1.2 trillion in a block-grant program to states — $25 billion less on Social Security, and $845 billion less on Medicare (some of that is reclassified to a different department). Their intentions are to cut benefits under Medicaid and Social Security.
Obviously, Congress didn't approve those cuts so it didn't happen but it wasn't for lack of trying.
That last budget was put together by the man Trump is bringing back as his Director of the Office of Management and Budget, and one of the principal authors of Project 2025, Russell Vought. It's highly questionable whether Vought will be as circumspect about the plans to cut the programs this time or whether Trump will care because all of that was predicated on Trump's need to run for office again. Without that hanging over their heads they have no need to hold back. Republicans have wanted to do away with those programs since they were first passed. This may be their chance to finally get it done.
As we know, Trump has pledged to create a sexy new government commission led by Elon Musk and Vivek Ramaswamy called the "Department of Government Efficiency" or DOGE . . . . Vought has said that he plans to work closely with the commission to use executive action to accomplish the slashing and burning of government programs they're promising.
Vought hasn't openly called for cutting Social Security retiree benefits but has promoted cutting disability payments and Medicaid and fully privatizing Medicare. His history suggests, however, that given the go-ahead he will gleefully take a meat ax to the program. Musk, however, has been clear that he believes the government has to be cut to the bone immediately which he admits will cause "hardship" that we will just have to bear.
This week, the far-right senator from Utah, Mike Lee, posted a thread on Twitter/X in which he claims that Social Security is a scam that the government mismanages and must be reformed so that people can "invest" their money and avoid "dependence."
It's the same old story. In fact, the last time they tried this after President George W. Bush declared he had a mandate from his re-election victory, it ushered in a massive Democratic congressional takeover in the midterms and a two-term Democratic presidency. The financial crisis hit and everyone in America saw the wisdom of having at least a portion of their old age or disability safety net guaranteed by the government instead of Wall Street. I suppose it's possible that it's ancient history to a lot of people but I kind of doubt it is for anyone over 50.
But it's possible they won't even try to sell it that way. Musk expects people to suffer in order to save the country from bankruptcy which he has decided is imminent. Vought and his right-wing Christian nationalist allies want to completely decimate the "administrative state" so they may just declare that the program is insolvent and cut the benefits across the board.
With what will be a tiny majority in the House it's very hard to see anything like that passing. Unlike Trump, they have to face the voters again. But we do know that Vought is a big fan of "impoundment" which basically says that the president can spend money however he wants regardless of what Congress has intended.
It is highly likely that the DOGE group and Vought at OMB are going to try to use this concept to sidestep Congress completely. Whether they have the nerve to attempt it with something as massive as Social Security or Medicare remains to be seen. But those programs are the right's great white whale and I wouldn't be surprised if they make another attempt to finally kill them.
Donald Trump certainly won't care. He never has to face another voter and that is the only reason he ever promised to keep his hands off of the programs in the first place. Trump can do somersaults on the third rail now and it can't hurt him at all. His party is another story, but he doesn't care about them either.
Tuesday, December 10, 2024
America's Ignored Healthcare Crisis
As you know, the C.E.O. of UnitedHealthcare, fifty-year-old Brian Thompson, was murdered on the street in midtown Manhattan, on Wednesday morning, twenty minutes before sunrise. He was in town for an investors’ convention, and had worked for UnitedHealthcare for more than two decades—a company that is part of UnitedHealth Group, a health-insurance conglomerate valued at five hundred and sixty billion dollars. UnitedHealthcare had two hundred and eighty-one billion dollars in revenue in 2023, and Thompson, who became C.E.O. in 2021, had raised annual profits from twelve billion dollars to sixteen billion dollars during his tenure. He received more than ten million dollars in compensation last year.
The particulars of this murder are strange and remarkable: it occurred in public; the suspected shooter went to Starbucks beforehand; he got away from the scene via bicycle; . . . . But the public reaction has been even wilder, even more lawless. The jokes came streaming in on every social-media platform, in the comments underneath every news article. “I’m sorry, prior authorization is required for thoughts and prayers,” someone commented on TikTok, a response that got more than fifteen thousand likes. “Does he have a history of shootings? Denied coverage,” another person wrote, under an Instagram post from CNN. On X, someone posted, with the caption “My official response to the UHC CEO’s murder,” an infographic comparing wealth distribution in late eighteenth-century France to wealth distribution in present-day America. . . . . What on earth, some people must be asking, is happening to our country? Are we really so divided, so used to dehumanizing one another, that people are out here openly celebrating the cold-blooded murder . . . .
There had been prior threats against Thompson, his wife told NBC News, motivated, she said, by, “I don’t know, a lack of coverage? . . . I just know that he said there were some people that had been threatening him.” There had been protests at the UnitedHealthcare headquarters, in Minnesota, in April and July; during the latter, eleven people were arrested. The group responsible for the protests, People’s Action, also confronted Witty, the UnitedHealth Group C.E.O., at a Senate hearing in May. In a statement, People’s Action leaders referenced endless hours on the phone trying to get medical care covered, and denials of coverage for lifesaving medication and surgery.
A recent statement from the group, in response to Thompson’s death, read, “We know there is a crisis of gun violence in America. There is also a crisis of denials of care by private health insurance corporations including UnitedHealth.” They urged political leaders to “act on both.” UnitedHealthcare has the highest claim-denial rate of any private insurance company: at thirty-two per cent, it is double the industry average.
To most Americans, a company like UnitedHealth represents less the provision of medical care than an active obstacle to receiving it. UnitedHealthcare insures almost a third of the patients enrolled in Medicare Advantage, a government-funded program facilitated by private insurance companies, which receive a flat fee for each patient they cover and then produce their own profits by minimizing each patient’s care costs. Reporting in the Wall Street Journal has found that these private insurance companies, which cover more than a third of American seniors on Medicare, collect hundreds of billions of dollars from the government annually and overbill Medicare to the tune of around ten billion dollars per year; UnitedHealthcare has used litigation to fight its obligation to repay fees that were overpaid.
In 2020, UnitedHealth acquired a company called NaviHealth, whose software provides algorithmic care recommendations for sick patients, and which is now used to help manage its Medicare Advantage program. A 2023 class-action lawsuit alleges that the NaviHealth algorithm has a “known error rate” of ninety per cent and cites appalling patient stories: one man in Tennessee broke his back, was hospitalized for six days, was moved to a nursing home for eleven days, and then was informed by UnitedHealth that his care would be cut off in two days. (UnitedHealth says the lawsuit is unmerited.) After a couple rounds of appeals and reversals, the man left the nursing home and died four days later.
At the same time that news was breaking about the NaviHealth algorithm, the company was fighting—ultimately unsuccessfully—a court decision that it had acted “arbitrarily and capriciously” in repeatedly denying coverage of long-term residential treatment to a middle-school-age girl who repeatedly attempted suicide, and has since died by suicide. Several years ago, government investigators found that UnitedHealth had used algorithms to identify mental-health-care providers who they believed were treating patients too often; these identified therapists would typically receive a call from a company “care advocate” who would question them and then cut off reimbursements. Though some states have ruled this practice illegal, it remains in play across the country.
There is no single regulator for a private health-insurance company, even when it is found to be violating the law. For United’s practices to be curbed, mental-health advocates told ProPublica, every single jurisdiction in which it operates would have to successfully bring a case against it.
Thompson’s murder is one symptom of the American appetite for violence; his line of work is another. Denied health-insurance claims are not broadly understood this way, in part because people in consequential positions at health-insurance companies, and those in their social circles, are likely to have experienced denied claims mainly as a matter of extreme annoyance at worst: hours on the phone, maybe; a bunch of extra paperwork; maybe money spent that could’ve gone to next year’s vacation. For people who do not have money or social connections at hospitals or the ability to spend weeks at a time on the phone, a denied health-insurance claim can instantly bend the trajectory of a life toward bankruptcy and misery and death.
Maybe everyone knows this, anyway, and structural violence—another term for it is “social injustice”—is simply, at this point, the structure of American life, and it is treated as normal, whether we attach that particular name to it or not.
Traditionally, our society fixates on only one version of this: direct physical violence committed by a person intending harm. The pretty girl killed by a boyfriend, the C.E.O. shot on the street, the subway dancer strangled by the ex-marine.
On this point, though, everyone’s really in agreement. It’s just a matter of where you locate the decay—in the killing, or in the response to it, or in what led us here. The only way to end up in a situation where a C.E.O. of a health-insurance company is reflexively viewed as a dictatorial purveyor of suffering is through a history of socially sanctioned death. A person who posted on Reddit’s r/nurses forum, whose profile describes her as an I.C.U. nurse, wrote, “Honestly, I’m not wishing anyone harm, but when you’ve spent so much time and made so much money by increasing the suffering of the humanity around you, it’s hard for me to summon empathy that you died.
Nurses, residents, aides, specialists—they are asked to absorb the rage and panic induced by the American health-care system, whose private insurers generate billions of dollars in profit and pay executives eight figures not despite but because of the fact that they routinely deny care to desperate people in need.
Thompson’s death resurfaced some unsavory details about his industry. We learned, for instance, that Thompson was one of several UnitedHealth executives under investigation by the D.O.J. for accusations of insider trading. (He had sold more than fifteen million dollars’ worth of company stock in February, shortly before it became public that the Department of Justice was investigating the company for antitrust violations, which caused the stock price to drop.) A new policy from Anthem Blue Cross Blue Shield also went viral: the company had announced that, in certain states, starting in 2025, it would no longer pay for anesthesia if a surgery passed a pre-allotted time limit. The cost of the “extra” anesthesia would be passed from Anthem—whose year-over-year net income was reported, in June, to have increased by more than twenty-four per cent, to $2.3 billion—to the patient. On Thursday, the company withdrew the change in response to the public outrage, if only in Connecticut, for now.
Subscribe to:
Posts (Atom)