In light of Republican-led states’ entrenched opposition to Obamacare’s Medicaid expansion, safety net hospitals around the country have expressed fears that they could go bankrupt as their government funding gets cut. On Monday, the Center for Medicare and Medicaid Services (CMS) announced that it would help these embattled hospitals by paring back planned cuts to their federal reimbursements.

In an attempt to cut government health expenditures, Obamacare included fairly deep cuts to so-called “disproportionate share” hospitals’ (DSHs’) — safety net facilities that cater mostly to the poor and uninsured — reimbursement payments. These cuts were intended to be offset by an influx of newly-insured Americans covered under the states’ expanded Medicaid programs.

But since the Supreme Court ruled the expansion optional, red states with a large number of low-income and uninsured residents have largely refused to take part in the Medicaid expansion, thereby creating a disastrous funding problem for safety net hospitals in these states. The CMS’s new proposed regulations represent an effort to avert those disastrous cuts as states get their acts together:

The Centers for Medicare & Medicaid Services proposed on Monday that for the next two years, the DSH dollars be reduced based partly on a state’s percent of uninsured residents (states with the lowest percent of uninsured receive larger reductions). CMS also seeks in the proposal to protect state DSH funding that is used to increase coverage under Medicaid demonstration waivers. [...]

“… since some states have yet to decide whether to expand Medicaid, this proposed rule will not discourage expansion, nor will it penalize hospitals in those states that have yet to make a decision,” [Rick Pollack, executive vice president of the American Hospital Association,] said.

However, CMS’s new proposal is a funding band-aid, not a permanent fix. The far more responsible and efficient way to take the heat off of America’s safety net hospitals — while securing low-income Americans’ medical and financial well-being — would be for highly uninsured states to accept the health law’s generous funding to expand Medicaid.

In fact, that’s exactly why some GOP governors such as Arizona’s Jan Brewer and Florida’s Rick Scott have reversed course and decided to endorse the Medicaid expansion — because hospital associations in their states have been warning that noncompliance in the face the upcoming payment cuts would cost them tens of billions of dollars and possibly force them out of business, leaving millions of America’s poor without recourse for medical care. Unfortunately, not all Republican state leaders and legislators seem to be swayed by that argument, forcing the CMS to take action and stave off safety net hospitals’ fiscal ruin.

But seeing as even the GOP governors who have endorsed expansion are struggling to convince skeptical legislators in their own party, the temporary fix is crucial to making sure that safety net hospitals — and the millions of poor Americans who rely on them — don’t end up as the collateral damage of a political fistfight over Obamacare. Arizona, Florida, Texas, and Louisiana — four GOP states that appear increasingly unlikely to expand Medicaid this year — have close to 12 million uninsured residents alone, approximately half of whom live below 138 percent of the Federal Poverty Level (FPL) and would likely gain Medicaid coverage under the expansion.

The Center for Medicare and Medicaid Services (CMS) released highly-anticipated data on Wednesday that outlines what hospitals across America charge for common inpatient medical services. The takeaway from the new numbers? There is no rhyme or reason to what different hospitals charge for the same procedures across geographic regions (or even within the same region), and prices can fluctuate by over $100,000 in the most extreme cases.

The CMS data is comprised of charge records from over 3,300 hospitals spanning 306 localities, and detail the costs of many of the most common inpatient procedures, such as treatments for heart failure, chest pain, respiratory infections, and lower limb replacements. The Huffington Post has a helpful graphic mapping the prices that hospitals throughout the New York and New Jersey areas charge patients for treating chronic obstructive pulmonary disease (COPD), which helps illustrate just how significant the disparities can be:

These numbers confirm a recent Time Magazine investigative report that found much of the same trend throughout the U.S. And the biggest victims of this rampant price variation — and apparent price-gouging — are the poor, the uninsured, and the underinsured. Public entitlements such as Medicare are relatively protected, since the government has the power to negotiate blanket prices and reimbursement rates for specific services. But private insurers — and, of course, the uninsured — don’t have that same capacity, making them subject to the whims of the hospitals they do business with. In essence, that means that poor people’s medical and financial stability are left up to pure luck, dependent on whether or not the hospital they visit charges reasonable rates.

As Obama Administration officials explained, there isn’t any feasible economic reason for this cost variation — and reformers are hoping that the publication of the data will shame hospitals into changing these practices and acting in good faith:

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Federal officials have a clear message for Nevada’s Rawson-Neal mental health facility: Stop mistreating patients, or see your federal Medicare dollars disappear. In a curt letter distributed by the Center for Medicare and Medicaid Services (CMS), the federal agency that oversees major entitlement spending warned the hospital — which has been accused of unceremoniously dumping its homeless patients onto buses — that “If we do not receive an acceptable, timely submission, or if a resurvey finds that the hospital is not complying with any [conditions of participation], we will notify you that we are initiating action to terminate the facility’s Medicare provider agreement.”

The beleaguered hospital gained national attention after reports surfaced that it had systematically been dumping homeless patients with serious mental illnesses onto buses to other states. Doctors allegedly told the patients this was necessary due to a dearth of funding for housing and mental health services in the state, suggesting that they would be better off elsewhere. Rawson-Neal allegedly bused at least 100 patients to California in just one year, despite the fact that Golden State is only marginally better at funding mental health care than Nevada is.

Primary reports focused on a schizophrenic patient named James Flavy Coy Brown, who was discharged and placed onto a Greyhound to California with nothing but light snacks and three days’ medication. A follow-up investigation by the San Francisco Bee found that the behavior was nothing new, leading state and federal officials to slam the alleged patient mistreatment:

The Bee followed with an investigative report that said Rawson-Neal had purchased one-way bus tickets for 1,500 discharged patients over five years, some of whom had been sent to locations where they had no contacts.

The revelations prompted the city attorneys of Los Angeles and San Francisco to announce probes into the matter earlier this week. Rawson-Neal patients were bused to both cities, according to the Bee’s findings.

Nevada Gov. Brian Sandoval said in a statement that his office had launched three separate investigations and that disciplinary actions had been taken. The governor’s office determined that policies were not followed in at least one instance. The new policy, he said, provides “additional oversight” to ensure the hospital follows proper discharge procedures.

“I take the concerns regarding Rawson-Neal Psychiatric Hospital very seriously and it is not the policy of the state of Nevada to engage in ‘patient dumping,’” he said in a statement.

State officials have also claimed that the problem is limited to Rawson-Neal, and not reflected through other state-operated facilities.

Now that Rawson-Neal’s Medicare dollars are in jeopardy, doctors and hospital administrators might be more eager to take action. But if the facility buckles under the weight of losing its federal funding — in addition to Nevada’s steep cuts to mental health services through its Medicaid program — then other public facilities in the state would be forced to absorb its patient load. Considering the multiple barriers to providing the homeless with mental health treatment, that could end up being a tall order.

Last Friday, the U.S. Department of Health and Human Services (HHS) announced that it would allow states to pursue waivers letting them privatize their Medicaid expansions under Obamacare — an idea that took root with a deal worked out by Arkansas Gov. Mike Beebe (D) and the Obama HHS last month. Commentators and policy-makers heralded it as a “game-changer” for the reform law, as it could influence red states — many of which have high poverty levels and massive uninsurance rates — to extend coverage to poor people and help facilitate a major Obamacare provision.

But as Medicaid policy expert and George Washington University professor Sarah Rosenbaum smartly pointed out to the Washington Post’s Sarah Kliff in March, using federal dollars to put Medicaid-eligible populations into privately-contracted plans isn’t a novel concept at all — to the contrary, states have actually been doing it for decades through their increasing use of Medicaid managed care (MMC) arrangements. These arrangements contract beneficiaries’ care out to private insurers and providers, and a full “two-thirds of Medicaid enrollees now receive most or all of their benefits in managed care.”

Republicans have historically been strong proponents of MMC, touting its potential to cut costs while protecting poor Americans’ benefits. But with HHS’s new offer to institute a wide-scale version of this program now on the table, several notable Republicans are balking at the idea — including some who have pushed for similar measures themselves in the recent past:

1. TEXAS GOV. RICK PERRY. The 2012 presidential aspirant has been on an anti-Medicaid bender of sorts lately, declaring that “Texas will not be held hostage by the Obama administration’s attempt to force us into the fool’s errand of adding more than a million Texans to a broken system.” Yet, during his presidential run in late 2011, Perry struck a massive deal with federal officials allowing him to move close to a million Medicaid beneficiaries into managed care. Perry heralded the move in a press release, saying, “By approving Texas’ Healthcare Transformation and Quality Improvement Program Waiver, state and local officials can provide more efficient and effective care, and implement locally-tailored health solutions.” Apparently, Perry doesn’t view the Obama Administration’s offer on privatized Medicaid to be a similar opportunity for implementing “locally-tailored” solutions.

2. LOUISIANA GOV. BOBBY JINDAL. One of Obamacare’s most ardent critics, Jindal has steadfastly refused to expand Medicaid in his low-income state, saying that “Medicaid still operates under a 1960s model of medicine with inflexible, one-size-fits-all benefits and little consumer engagement and responsibility.” So far, he has stuck by that decision despite the urging of local lawmakers and his own state’s hospital chains. But back in 2011, Jindal aggressively — and successfully — pushed through an expansion of Louisiana’s MMC program, shifting 900,000 Medicaid and CHIP beneficiaries onto private, managed care. The measure was actually Jindal’s number one health care-related priority for 2012, and his administration publicly sold it “as a way to save taxpayer money and provide better care through coordination among doctors, hospitals and other medical professionals.”

3. MISSISSIPPI GOV. PHIL BRYANT. In an interview with Kaiser Health News, the Mississippi governor said, “I would rather pay extra to Blue Cross [to help cover uncompensated costs for the uninsured], rather than have to raise taxes to pay for additional Medicaid recipients” — a tacit endorsement of a managed care scheme. In fact, in 2012, Bryant signed a bill allowing Mississippi’s Medicaid division to increase the proportion of beneficiaries who could be placed onto managed care programs from 15 percent to 45 percent of the aggregate pool. Bryant has attributed his opposition to Medicaid expansion to his view that the program disincentivizes people “to find a better job, or to go back to school, or to get [into] a workforce training program.”

The Affordable Care Act gave HHS the authority to test innovative reforms to the healthcare payment and delivery systems with the goal of improving quality of care while reducing costs — and the Administration is beginning to take important steps in that direction.

Last week, the Centers for Medicare and Medicaid Services (CMS) announced that over 450 health care organizations will participate in the Bundled Payments for Care Improvement Initiative. The new initiative tests a promising model that aims to drive down costs throughout the health system by creating financial incentives for medical providers to provide more coordinated, higher quality care to their patients.

Bundling payments is an alternative to Medicare’s current fee-for-service financing system, in which providers are paid separately for each individual service rendered in a single course of treatment. For example, under the current system, Medicare would make a separate payment for each of the following during a cardiac patient’s stay in the hospital:

– Payment to the hospital to cover room and board, nursing services, prescription drugs, other supplies and equipment, and all diagnostic and therapeutic services during the hospital stay
– Separate payments for the services provided by the physicians who cared for the patient during the stay.

If the patient is then transferred to a nursing home, Medicare might make the following additional payments:

– A daily payment amount to the nursing facility to cover room and board, nursing services, prescription drugs, and rehabilitation services during his nursing home stay
– Payment to the ambulance company for transporting the patient to and from his cardiologist’s office
–Payment to the cardiologist for the visit during the nursing home stay

And even after the patient goes home, Medicare could continue to make separate payments:

– Payment to the home health agency for visits after the patient returns home
– Payment for the prescription pain reliever after the patient returns home

This fragmented payment system leads to a fragmented delivery system. Medical providers have every financial incentive to provide high volume of services, whether or not those services are necessary or lead to better patient outcomes, and they don’t have any incentives to coordinate with other providers to deliver efficient and coordinated patient care. That means providers often operate with minimal communication — which leads to waste, inefficiency, and diminished quality of care for their patients.

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Our guest blogger is Lindsay Rosenthal, Special Assistant for Health Policy and Women’s Health and Rights at the Center for American Progress.

According to a new study released by the Journal of General Internal Medicine, out-of-pocket medical spending in the last five years of life left one in four American seniors bankrupt.

The study found that average “out-of-pocket expenditures in the 5 years prior to death were $38,688 for individuals, and $51,030 for couples in which one spouse dies.” That average was skewed upwards by staggeringly high out-of-pocket medical spending by seniors who had particularly expensive medical needs. All told, a full “25 percent of subjects’ expenditures exceeded baseline total household assets, and 43 percent of subjects’ spending surpassed their non-housing assets,” according to the report.

The study’s findings underscore the fact that, despite Medicare coverage — which is more efficient and cost-effective compared to private insurance — health care consumption by seniors suffering from costly diseases such as cancer and Alzheimer’s can often drive up prices to an unsustainable rate.

That represents the simple reality of the costs of treating diseases for which there are still no cures. Seventy percent of national health care expenses derive from just 10 percent of the population, usually by terminally ill Americans.

But when conservative politicians use that figure to justify radical cuts to social safety net programs, their logic simply doesn’t add up. Shifting ailing patients away from publicly financed insurance programs and into the private market only drives up health care costs and uncompensated care rates by forcing people to pursue treatment that they cannot afford — and those policies would simply force even more seniors to exceed their non-housing assets to pay for their medical costs. The solution to this issue lies in finding more cost-effective treatments for costly diseases, not leaving seniors to their own devices to figure out how to pay for their health care.

Last week, Louisiana’s poor and terminally ill residents won a surprising victory when Gov. Bobby Jindal (R) announced that his state would not stop providing hospice care to its Medicaid beneficiaries. Unfortunately, that’s about the only piece of good news for low-income Louisianans’ health coverage, as the state is still set to implement massive cuts for Medicaid programs that “provide behavioral health services for at-risk children, offer case management visits for low-income HIV patients and pay for at-home visits by nurses who teach poor, first-time mothers how to care for their newborns” this Friday.

While Jindal administration officials argue that the cuts could be mitigated by Medicare and private managed care programs, the reality is that many of these specialty services are simply unavailable — or unaffordable — outside of Medicaid:

Health and Hospitals Secretary Bruce Greenstein said he targeted programs that were duplicative, costly and optional under the state’s participation in the state-federal Medicaid program.

Greenstein said in many instances, people can get the care they’re losing through other government-funded programs. But he acknowledged that won’t happen in every case, meaning some people will simply lose the services or receive reduced services. [...]

Jan Moller heads the Louisiana Budget Project, which advocates for low- to moderate-income families. Moller said he’s most distressed by the cut to the Nurse-Family Partnership Program.

The health department is eliminating the portion of the program that offers at-home visits to low-income women who are pregnant with their first child. Registered nurses visit the women early in their pregnancy and until their children’s second birthday, offering advice on preventive health care, diet and nutrition, smoking cessation and other child developmental issues. [...]

“What the Nurse-Family Partnership does goes above and beyond what a good obstetrician does,” Moller said. “It’s really about teaching life-skills to at-risk moms to make them better parents and make them better able to care for their children, and it’s been proven to work.”

Speech therapy programs for low-income children are also on the chopping block. The cuts — as well as Jindal’s proposals to raise taxes on the poor while slashing public education and other health care funding — are meant to plug a midyear budget deficit. But they are more likely to raise health care costs and poverty levels in a state that already ranks among America’s least-insured and poorest locales by pushing people poor people into finding services that they will no longer be able to afford.

While Jindal has spoken at length on the Republican Party’s existential need to stop being “the stupid party,” the “austerity” policies that he has pursued for his state are some of the most regressive in the entire country.

The Centers for Medicare and Medicaid Services (CMS) and the Department of Health and Human Services (HHS) released a slew of important new Obamacare rules and regulations today, continuing a widely expected post-election effort to successfully implement President Obama’s landmark health care reform law by 2014.

In a call with reporters, CMS and HHS outlined the new proposed rules, which instruct insurers, providers, and governmental institutions on how they must proceed in implementing Obamacare measures — ranging from a ban on discriminating against Americans with pre-existing medical conditions to public wellness initiatives such as coverage for employees’ gym use. Here are the three most important things you need to know about the new rules:

1) Insurers will be prohibited from discriminating against Americans with pre-existing conditions. Long considered one of the health insurance industry’s most odious practices, refusing to extend coverage to Americans suffering from a pre-existing medical condition will soon be a thing of the past. The first of CMS’s proposed rules mandates that insurance companies will need to base their premium rates solely on an individual’s age, family size, geography, and history of tobacco use — preventing discrimination against Americans for any other reason, such as their gender or their chronic illnesses. The rule will also set strict limits on how much insurers can vary the premiums they charge Americans based on these factors, marking an end to gender rating practices that charged women more than men for the same medical services. This will be a boon to the over 120 million Americans who suffer from a pre-existing condition in one form or another.

2) State exchanges will establish a standard of “essential health benefits” that every plan will be required to cover. Obamacare will require the plans offered under state-wide health insurance exchanges in 2014 to clear federal benchmarks across ten “essential health benefit” categories, including access to maternal care, mental health services, preventative health care, and prescription drug coverage. These assured benefits — which are supposed to reflect the level of coverage offered by a typical employer-sponsored plan — will help correct for spotty coverage that does not actually meet Americans’ medical needs. CMS’s proposed rule requires state exchanges to offer to the same level of coverage as a statewide benchmark health plan of the state’s choosing. If a state’s chosen benchmark plan does not cover all of Obamacare’s required benefit categories — for instance, by not offering mental health services — then the federal government will intervene and supplement that plan so that it does meet the health law’s coverage requirements. The rule also creates standards for prescription drug coverage so that such coverage actually meets Americans’ health care needs and prohibits health plans from designing their benefits in a way that discriminates against certain groups of Americans.

3) Wellness programs will help promote public health and curb health care costs. The last of the three proposed rules is joint guidance from HHS, the Treasury, and the Department of Labor regarding sponsorship of workplace wellness programs. Obamacare encourages preventative health initiatives and a transition from “sick care” to actual “health care” in an effort to both improve Americans’ quality of life and lower national health spending. Under the proposed rule, employers are encouraged to continue both participatory and health-contingent wellness programs — such as subsidizing the cost of employees’ fitness center memberships or enrolling employees in tobacco-cessation programs — in exchange for federal rewards.

These rules will give states more clarity as they move forward in implementing the Affordable Care Act. Although many Obamacare details must still be worked out — particularly regarding the statewide insurance exchanges — the reform law has made enormous strides in the last year that will result in a fairer, more accessible, and more affordable American health care system that is a marked improvement over the pre-Obamacare era. “It’s important to remember what this market looked like back in 2009… We were definitely headed in the wrong direction,” HHS Secretary Kathleen Sebelius said on the conference call.

The Department of Health and Human Services (HHS) issued a news release today announcing that President Obama’s health reform law has successfully increased enrollment and decreased premiums in Medicare Advantage over the last two years. HHS Secretary Kathleen Sebelius noted that the program has seen a nearly 30 percent increase in enrollment and a 10 percent decrease in premiums since Obamacare’s passage, and projected that the positive trends will continue over the next year:

“Thanks to the Affordable Care Act, the Medicare Advantage and Prescription Drug programs have been strengthened and continue to improve for beneficiaries,” said Secretary Sebelius. “Since the law was enacted in 2010, average premiums have gone down, enrollment has gone up, and new benefits and lower drug costs continue to help millions of seniors and people with disabilities.”

For the third year in a row, the Centers for Medicare & Medicaid Services (CMS) used authority provided by the Affordable Care Act to protect beneficiaries from significant increases in costs or cuts in benefits. Access to supplemental benefits remains steady and beneficiaries’ average out-of-pocket spending remains constant.

Obamacare’s cost-containment provisions include phased payment cuts to providers in Medicare Advantage, part of a cost-saving strategy that Republicans mischaracterize as “robbing Medicare” despite the fact that it is intended to slow the program’s growth to prolong its solvency. Since the landmark health reform law’s passage, increased enrollment in Medicare Advantage and Administration officials’ stronger bargaining position with insurance providers have also helped lower the program’s costs.

HHS’s assessment of Obamacare’s impact on Medicare Advantage is confimed by health policy organizations like the Kaiser Family Foundation, whose June report found that the program’s enrollment rate rose by 10 percent while the average premium dropped by $4 during the first half of this year. Thanks to the ongoing implementation of the health reform law, low-income Americans should continue to see their Medicare Advantage premiums decrease over time, and they will soon have a wider array of quality-rated plans to choose from.