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Kaiser Health News published an article noting that the governor of California awarded a no-bid contract to Blue Shield and recounting a number of donations that the insurer has given to the governor's campaigns. While the contract is only $15 million (the insurer had $21 billion in revenue in 2019), the contract represents a marketing opportunity that could be valuable for the company.

Kaiser Health News published an article noting that the governor of California awarded a no-bid contract to Blue Shield and recounting a number of donations that the insurer has given to the governor's campaigns. While the contract is only $15 million (the insurer had $21 billion in revenue in 2019), the contract represents a marketing opportunity that could be valuable for the company.

With only a quick review, the optics do not look good: Blue Shield has a history of donating to the governor's campaigns (including some special interests). Vaccines are generally administered through providers, although one can imagine that having a strong retail presence (like drug stores) could be very helpful. Blue Shield, a health insurer, controls neither a provider network nor a strong retail presence. What the insurer does have is a history of financial contributions.

The optics would look much better if the contract had a bidding process. What the administrator would likely reasonably respond with is that the current circumstances call for speed and agility, not for perfection. While that might be true, it seems that the state could have put forth a bidding process with an accelerated review schedule.

The Galen Institute -- a healthcare free-market "public policy research organization" -- published a study that critiqued the Affordable Care Act (ACA) premium subsidies included in the most recent COVID relief legislation. Among other issues, the author criticizes the legislation for benefiting some higher-income workers more than some lower-income workers. It's possible that there are some nuances about how insurance subsidies work that are not covered, or that legislators simply did not have enough time to work out details. What was interesting was the author's more general critique of ACA: that the CBO estimated that 25 million people would enroll in the health insurance exchanges, but that number is closer to 10 million in reality. ("Annualized exchange enrollment in 2019 was 10 million -- 15 million people below CBO's projections of 25 million exchange enrollees in 2019.") Additionally, the author claims that while 2 million of those 10 million enrollees are enrollees in a private health plan (e.g. non-Medicaid), the number of employees covered by employer-sponsored dropped by the same number, meaning that most of the gains in covered lives came through Medicaid expansion.

The Galen Institute -- a healthcare free-market "public policy research organization" -- published a study that critiqued the Affordable Care Act (ACA) premium subsidies included in the most recent COVID relief legislation. Among other issues, the author criticizes the legislation for benefiting some higher-income workers more than some lower-income workers. It's possible that there are some nuances about how insurance subsidies work that are not covered, or that legislators simply did not have enough time to work out details. What was interesting was the author's more general critique of ACA: that the CBO estimated that 25 million people would enroll in the health insurance exchanges, but that number is closer to 10 million in reality. ("Annualized exchange enrollment in 2019 was 10 million -- 15 million people below CBO's projections of 25 million exchange enrollees in 2019.") Additionally, the author claims that while 2 million of those 10 million enrollees are enrollees in a private health plan (e.g. non-Medicaid), the number of employees covered by employer-sponsored dropped by the same number, meaning that most of the gains in covered lives came through Medicaid expansion.

The author also pointed out that tax payers are subsidizing insurance premiums by about $50 billion per year and that individual market premiums doubled between 2013 and 2017. All of these statistics point to a less rosy picture of ACA's success -- it would be interesting to read an ACA's proponent's scholarly take on all of this.

NBC News published an alarming article detailing patient accusations of a hospital misdiagnosing and then altering the patient's medical record to avoid guilt. If true, the allegations are quite concerning. From what has been pieced together, the hospital originally declared the patient to be free of cancer, but that diagnosis was apparently the result of a technician accidentally selecting the wrong value from a dropdown menu despite leaving a contradictory textual comment. When the patient eventually learned from a second opinion that she had cancer, she was diagnosed with stage 4 and advised that she might have less than a year to live. One might be skeptical of a single patient's accusations, and I was surprised to learn that a forensics firm worked on about 500 medical malpractice cases and found "significant alterations to the patient's record that favored the hospital in 85 percent of them."

NBC News published an alarming article detailing patient accusations of a hospital misdiagnosing and then altering the patient's medical record to avoid guilt. If true, the allegations are quite concerning. From what has been pieced together, the hospital originally declared the patient to be free of cancer, but that diagnosis was apparently the result of a technician accidentally selecting the wrong value from a dropdown menu despite leaving a contradictory textual comment. When the patient eventually learned from a second opinion that she had cancer, she was diagnosed with stage 4 and advised that she might have less than a year to live. One might be skeptical of a single patient's accusations, and I was surprised to learn that a forensics firm worked on about 500 medical malpractice cases and found "significant alterations to the patient's record that favored the hospital in 85 percent of them."

Putting aside the shocking cover-up (if true), this case highlights that both the patient and the hospital might have been better off if the patient had full access to her medical records in this case. Many medical providers have been reluctant to fully share patient medical records, for fear of misinterpretation, additional questions, or perhaps mistakes that might be uncovered by patients. However, increasing reliance on software might make it easier for mistakes to slip by (whereas in older times, perhaps the referring doctor would have seen the textual comment). Electronic health records bring many benefits over paper records, but they are still vulnerable -- and perhaps especially so -- to bad input. Allowing patients to have full and easy access to their own medical records could be an important tool in catching mistakes early.

Additionally, watching hospitals complain about the cost and complexity of accessing the audit log is concerning. If the number of accusations of cover-ups rises significantly, the medical industry would ideally have an incentive to have an easier time to access and interpret the audit log rather than use it as a smokescreen to deny wrongdoing.

Kaiser Health News published an article about 774 hospitals penalized because of patient complications. Medicare has adopted a carrot-and-stick approach to get hospitals to perform better (e.g. fewer complications and re-admissions). Naturally, hospitals criticize Medicare's program.

Kaiser Health News published an article about 774 hospitals penalized because of patient complications. Medicare has adopted a carrot-and-stick approach to get hospitals to perform better (e.g. fewer complications and re-admissions). Naturally, hospitals criticize Medicare's program.

In particular, some hospitals suggest that they have been penalized simply because they are more thorough in reporting infections and other complications to Medicare. If true, this means that evaluation of the hospitals relies in part on self-assessment and is vulnerable to abuse. While most hospitals may be honest, it seems likely that some will overlook what they consider minor issues. Even putting aside fraud, there is the very real possibility that different hospitals simply have different standards for what is considered a complication.

Some hospitals also complain that they have sicker patients who are more likely to be re-admitted. Assuming that Medicare already risk-adjusts for patient population, hospitals appear to be taking issue with Medicare's risk-adjustment model. It seems unlikely, however, that the entire medical industry would be satisfied with any one risk-adjustment model at this point.

Some other hospitals appear to complain about being pitted against one another ("tournament" model), where being "good" is not enough... hospitals need to be in a certain tier relative to other hospitals. Understandably, Medicare does not want hospitals to stop improving, but some hospitals seem to think that the improvements are so small now that differences in ranking are essentially meaningless and they would rather Medicare adopt fixed thresholds. Needless to say, if Medicare proposed fixed thresholds that were too stringent, hospitals would also complain.

Overall, it seems clear that there may be a variety of issues with the way that Medicare encourages hospitals to perform better. Nevertheless, Medicare does seem to be pushing the industry forward, not letting perfection be the enemy of progress.

Kaiser Health News reported on a legislative initiative to move California to a single-payer healthcare system. About 20 state assembly members have indicated support for the legislation. Of note, analysis of a prior single-payer proposal projected the cost at $400 billion, which is approximately twice the governor's proposed state budget of $227 billion. The assembly member who introduced the bill seems to think current funding for health care (probably including privately paid premiums) might be re-routed to pay for the proposal.

Kaiser Health News reported on a legislative initiative to move California to a single-payer healthcare system. About 20 state assembly members have indicated support for the legislation. Of note, analysis of a prior single-payer proposal projected the cost at $400 billion, which is approximately twice the governor's proposed state budget of $227 billion. The assembly member who introduced the bill seems to think current funding for health care (probably including privately paid premiums) might be re-routed to pay for the proposal.

The proposal appears generous, ending all out-of-pocket costs (even copays and deductibles). However, requiring all Californians to enroll in the new plan might require federal regulatory changes. Coupled with the big price tag and a lack of a clear funding mechanism, it seems unlikely that the legislation will pass in this season. The effort is, however, another example of people being interested in single-payer health care.