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Embracing Wall Street, stiff-arming Congress (for now)
We finally got an answer of how much financial damage the Change Healthcare cyberattack did to UnitedHealth Group: Basically none.
My colleague Tara Bannow listened to the earnings call, and the company’s leaders shrugged off the wide-ranging hack, which will cost UnitedHealth $1.6 billion this year. Executives predicted the company’s full-year adjusted earnings will be unaffected. If you take out the $7 billion charge UnitedHealth had to take on the sale of its Brazil operations, the company still netted $5.7 billion of profit in the first quarter.
But there were a few elephants in the room. The first was the Justice Department’s ongoing investigation into UnitedHealth. It could have been Tara’s imagination, but she got the sense that UnitedHealth CEO Andrew Witty had that in mind as he declared — twice! — in prepared remarks that the Change debacle would be so much worse if UnitedHealth didn’t own it. Elephant number two was the fact that congressional leaders held a hearing focused on the Change cyberattack that very same day. They had hoped to grill UnitedHealth leaders, except they didn’t show. Lawmakers were furious, my colleague Brittany Trang reports. One even called for a subpoena.
But we’ll finally get a public grilling on the Change ordeal in two weeks. Witty officially will testify before a House subcommittee on May 1, one day after he’ll be in front of a Senate subcommittee. Expect Witty to present a friendlier rehashing of what he told Wall Street.
OoOoOo, the ‘ghost codes’
In 2022, health insurers and employers had to start disclosing what they paid hospitals, doctors, and other providers. It led to an avalanche of data — literal terabytes of sludge that were mostly unusable for the average person.
It turns out a lot of those data points are “ghost codes” or “ghost rates,” which are payment codes tied to providers who will never actually perform the service that’s listed, experts said last week at a virtual summit on health care price transparency. Roughly 60% of that data is for “clinically implausible” services, according to Turquoise Health, a company that analyzes health care pricing data. For example, in their data files, health insurers include payment rates for a dentist performing a heart transplant or a psychiatrist replacing someone’s knee.
“A psychiatrist is never going to operate and do a knee replacement, but that code is still showing up in the data,” David Muhlestein, a visiting policy fellow at Duke’s Margolis Center for Health Policy, said during the virtual conference. “That’s one of the things that I hope [the Centers for Medicare and Medicaid Services] will do in the future is just say, ‘Exclude all codes unless you’ve actually paid them at least once in the past year.’”
Hospitals mum on post-Dobbs maternal care
Hospitals usually don’t talk a lot about abortion because of how politically charged the issue is, which makes it bad for business. Hospitals are clamming up even more in the wake of the Dobbs decision two years ago, my colleague Olivia Goldhill reports.
STAT reached out to 100 hospitals to ask how maternal care has changed since the Supreme Court overturned the constitutional right to abortion, and just six made a doctor available for an interview.
“Even in an incredibly progressive state like New York, for those in C-suite, advertising, and PR, there’s always been a lot of concern and stigma around abortion care,” Aileen Gariepy, director of complex family planning at Weill Cornell Medicine, told Olivia. “That’s been magnified.” Read more.
The fall of the inpatient joint replacement
Up until recently, total knee and hip replacements were the most common Medicare claim submitted by hospitals. But those cases have come crashing down over the past few years after Medicare said those surgeries no longer had to be done exclusively as an inpatient procedure.
This trend is clearly displayed after playing with a helpful hospital dashboard from McDermott+Consulting. The consulting firm combined data from Medicare’s proposed hospital payment rule for 2025, which came out two weeks ago, with data from prior rules to give a sense of what procedures cost and how many cases Medicare is paying for.
Hidden fees go deeper than you think
We’ve written before about some of the buried fees that health insurance companies charge their employer clients — and how employers are fighting back in the courts. But a new episode from Stacey Richter’s Relentless Health Value podcast will blow your mind on just how far some of the financial shenanigans go.
One example: “shared savings” fees. If a worker goes to an out-of-network provider and the insurance company negotiates a discount off that high out-of-network charge, the insurance company keeps a portion of those “savings” for itself instead of giving all of the savings to the employer.
“Those fees, depending on how large of a claim it is, can be quite egregious if there’s no cap on what they’re taking,” Justin Leader, an independent health plan broker, said on the podcast. I highly encourage you to listen to the whole episode, if for nothing else to learn about the absurdity of “pay and chase” fees.
Industry odds and ends
- A big thanks to NPR’s 1A for having me on to talk about Medicare, along with KFF’s Tricia Neuman and the Medicare Rights Center’s Fred Riccardi.
- Earnings this week: Molina Healthcare (Wednesday), Universal Health Services (Wednesday), HCA Healthcare (Friday), Centene (Friday).
- Also keep tabs on AbbVie’s earnings on Friday. Biosimilar versions of Humira have gone nowhere over the past year, but that appears to be reversing after CVS Caremark made a hard switch to covering a Humira biosimilar that it jointly produces with the drug company Sandoz.
- The New England Journal is cutting off competitor media companies from access to its embargoed articles, Kristina Fiore of MedPage Today reports.
- The federal government has set up an “online portal” called HealthyCompetition.gov, where people can file complaints of what they think are anticompetitive practices within health care (there are a ton of examples of what people can submit, so I hope the developers can handle all the traffic).
- Elevance Health (formerly known as Anthem and WellPoint) is partnering with the private equity firm Clayton, Dubilier, & Rice to create a $4 billion primary care company housing doctors, clinics, and technology, Tara reports. Sounds a lot like what Humana has done with Welsh Carson.
- Hospitals are going to hate this: Two former HHS secretaries — Kathleen Sebelius and Alex Azar — wrote in a STAT op-ed that they fully support site-neutral payments, which would equalize payments between hospital-owned clinics and independent physician offices.
The Meme Ward
