Hospital News, 10-1-2011 - Western Pennsylvania Healthcare News

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6| wphospitalnews.comIssue No. 10HEALTH CARE From Page 1of concerned citizens in trying to understand the major elements and their relationshipsto one another within the health care delivery and financing system itself.This kind of understanding is crucial to effective policy development.This third level is in many respects the foundation for the other two levels. Unfortunately,the general electorate, most policy makers, media, and even some healthcare providers and insurers don’t know enough about the overall health care systemand its key components to help in making effective changes a reality.In Western Pennsylvania a case which demonstrates this point involves the refusalof the dominant health care system, UPMC, to renew it long-term provider contractwith the dominant health care insurer, Highmark. UPMC’s reason for non-renewalis that Highmark is buying a provider health care system of its own, West Penn Allegheny,and will, therefore, compete with UPMC as an “integrated delivery andfinance system”, or IDFS, that is, an arrangement where providers and insurers arecorporately linked. UPMC also has its own insurance company, however, UPMCdoes not want to contract with Highmark thus giving Highmark the opportunity tochannel patients from UPMC to West Penn Allegheny.Up until this point in time most people were happy with their insurance coverageand their doctors although there were complaints about the cost of insurance andthe need for more competition among providers and insurance companies alike.These complaints were supported by the media and by politicians. This is also aclassic example of being careful about what you ask for because it might just cometrue.Under the current commercial contract between UPMC and Highmark, peoplewith Highmark insurance are covered when they use UPMC physicians and hospitals.With some exceptions, such coverage will not exist when there is no contractbetween UPMC and Highmark, and people are concerned that they will be subjectedto non-covered pre-existing conditions if they switch from Highmark to other insurancecompanies in order to have coverage to maintain their UPMC physiciansand hospitals. One distasteful alternative is to just pay charges in order to useUPMC providers.UPMC has responded by saying that it has contracted with four additional insurancecompanies which are not competing IDFSs, and which are available to provideconsumer coverage for both UPMC and West Penn Allegheny health careproviders. In fact, UPMC contends that what it intends to do is support the additionof much needed competition to the Western Pennsylvania health care market in theform of two major IDFSs (UPMC and Highmark) rather than one, and the additionof four major insurance companies who can contract with both IDFSs. UPMC hasalso stated its willingness to address concerns about pre-existing conditions, at leastuntil health care reform eliminates such provisions.Understanding by the general public of this difficult situation is confounded bythose people expected to be in the “know” and whose propaganda is intended toadvance a political agenda rather than an educational one. One public health officialcommented that he seriously didn’t realize that charitable non-profit hospitals couldcompete. Another state legislator intends to offer a bill to force binding arbitrationbetween UPMC and Highmark even though the insurance commissioner believesthat there is no statutory authority to intervene other than as a non-binding mediator.The newspaper advocates that since UPMC is tax exempt it “belongs to the community”.Even if UPMC meets the letter of the charities law, the argument is madethat it does not meet the spirit of the law by “pushing millions of patients off a cliff”.Finally, UPMC’s tax exempt status is being challenged in the media as is the use ofsubscriber generated surplus by Highmark to buy the West Penn Allegheny providersystem.Lack of understanding causes public reaction to be more susceptible to misinformationand fear rather than to more rational thinking. This is true whetherthe topic is national health reform or health care competition in Western Pennsylvania.Improving health care literacy is a continuous, long-term, uphill objectiveto accomplish. Perhaps some of the best educated people in Americaabout health care are Medicare beneficiaries for reasons of maturity and experience.The United States has more published research articles about health literacy thanany other developed country. Yet, many of its outcome measures fall below thoseof a significant number of these countries. Perhaps there needs to be a greater pushfor transition from the bench to practice. Starting the various levels of learningprocess at earlier stages of life might make sense as well. In any case, it should bea top health care policy, and it should begin immediately.George A. Huber, JD, MSIE, MSSM, is Professor of Public Health Practice at the Universityof Pittsburgh.Hospital News is always seeking your opinion pieces on any topic related to thehealthcare sector. Please email Daniel Casciato at writer@danielcasciato.com withyour ideas.Consider on groundor online learningEvaluate yourtransferpossibilitiesjoin us!OPENHOUSESATURDAY,NOVEMBER 5Ask about financial aid,scholarships, PTI grants,and graduate successMeet faculty andstudents in their labsTalk to us about fast-track,no-fee educationEXPERIENCE PTI, A UNIQUEKIND OF COLLEGE.RSVP by calling Heather at1.800.784.9675 x 5381or visit pti.edu/openhouseSuccess YOUR WayWestern PA Hospital News wantsto hear from you!How are you using social mediato increase awareness?Email Daniel Casciato atwriter@danielcasciato.com andwe'll publish your story.DELTA PROPERTY MANAGEMENT, INC.www.RentDelta.com • 412-767-9880Delta manages propertiesin Shadyside, Oakland,North Hills, North Side,Lower Burrell and more.We have a variety ofapartments from studiosto furnished corporate suitesand town homes.Call or email us today to checkavailability and pricing.
Issue No. 10 wphospitalnews.com| 7COBRA Rules for EmployersBy Joseph A. Vater, Jr.When a health care employee is laid off or has an unemployedadult child who no longer qualifies as a dependent,the employer should expect that the employee’s firstquestion will be, “How can I make sure that my family hasmedical coverage?”And employers with more than 20 employees such asmost hospitals and other healthcare institutions, better beready with answers.All employers should make sure that they can explainto employees their options under the Consolidated OmnibusBudget Reconciliation Act (COBRA). COBRA isa federal statute that requires group health plans which are sponsored by employerswith 20 or more employees in the preceding year to provide a temporary extensionof health coverage for individuals who were previously enrolled in an employer’shealth plan but no longer qualify for standard coverage. The plan offered to the individualunder COBRA is the same as what is offered to similarly situated currentemployees. COBRA coverage is offered to the employee, his or her spouse and dependentsunder certain circumstances, including but not limited to:l Voluntary or involuntary job loss;l Reduction in hours worked so that the employee no longer meets the minimumrequirement for standard coverage;l Transition between jobs;l Death of the individual carrying the insurance (benefits extended to qualifiedfamily members)l Divorce or legal separation;l Loss of dependent child status under the plan’s definition.Employers are responsible for notifying the group health plan administrator of aqualifying event regarding employment, such as an employee’s job loss, reducedhours or death, within 30 days of the event. In personal situations regarding divorceor legal separation, it is up to the dependent to notify the group health plan within60 days.The employer is responsible for making sure that the initial summary plan descriptionthat is given to employees upon taking part in the group health plan includesa description about each plan participant’s COBRA rights and benefits. Ifthe summary plan description is not distributed to the employee within the first 90days of coverage, the employer must make sure that a separate notice on COBRAbenefits is provided within those 90 days. What employers sometimes neglect isan additional notice about COBRA that must be sent within 14 days of a qualifyingevent so that the individual can make an informed decision within 60 days aboutwhether or not to select COBRA coverage.Both the Department of Labor (“DOL”) and the Internal Revenue Service(“IRS”) may assess significant penalties for COBRA non-compliance. The IRSmay assess an excise tax of $100 per day per beneficiary ($200 per day per family),up to $2,500 per beneficiary. Additional penalties of up to $15,000 may be assessedif the violation is more than minimal. The maximum penalty that may be assessedby the IRS is the lesser of $500,000 or 10% of the health plan’s cost in the prioryear. The DOL has a penalty of $110 per day per beneficiary. These assessmentswill be made against the employer and each person responsible for administeringthe benefits.Employers should be prepared to answer questions about the cost of premiumsfor employees who are involuntarily terminated. The American Recovery and ReinvestmentAct of 2009 provided a COBRA premium subsidy that covered 65% ofthe cost for those who were involuntarily terminated from employment for a periodof up to fifteen months. Individuals had to qualify by May 31, 2010, and the UnemploymentCompensation Extension Act of 2010 did not extend COBRA premiumreductions. As of August 31, 2011, most individuals are responsible for the fullcost of COBRA premiums.Legal UpdateCOBRA administration is complex, and should be well understood by any healthcare employer. Health providers should regularly review their COBRA notices andprocedures to ensure that they are in compliance with COBRA’s requirements. IfCOBRA administration is handled in-house by employees, a procedures manualwith forms should be considered. If the administration of COBRA is outsourced,employers should carefully review the qualifications of the entity who would beproviding the COBRA administration and attempt to require that entity by contractto be liable for any penalties or assessments resulting from that entity’s failure tocomply with COBRA’s requirements. Finally, managers, supervisors and humanresources personnel should be trained to advise the person or entity responsible forCOBRA administration of qualifying events as soon as possible.Just as health care providers know the importance of getting the right medicalcare, it is equally important to make sure that all employees know their rights andoptions when it comes to paying for it.Joseph A. Vater, Jr., is an attorney with Meyer, Unkovic & Scott.Carlow UniversityAccelerated Nursing Degree eee ProgramsUndergraduateePrograms Include:• RN to BSN (can be completed ed in as little as 16 months)• RN to MSNGraduateDegree Offerings:• MSN with Focus in Education and Leadership• MSN, Family Nurse PractitionerClasses just oneday a week.Connect With Us:Twitter.com/wpahospitalnewsFacebook.com/wpahospitalnewsGreensburgwww.carlow.edu/greensburgw w w .r e eu r gPlease contact Wendy Phillipslipsat724.838.7399 or 1.877.451.3001 for more information.CranberryCwww.carlow.edu/cranberryw w w .c r ae r rPlease contact Jim Shankelat 724.741.1028 41.1028 for moreinformation.LinkedIn.com/in/HarveyDKartVaalues. Scholarship. Vision.®
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