iLoveBenefits: Industry News Blog

Medicaid – where does the money go?

Medicaid Plans’ Costs by Functional Area Per Member Per Month (PMPM)

According to a recent edition of Plan Management Navigator by Sherlock Company:

  • $7.24 Median PMPM – Provider & Medical Management
  • $14.61 Median PMPM – Account & Membership Administration
  • $5.05 Median PMPM – Corporate Services
  • $24.48 Median PMPM – Subtotal: Core Expenses
  • $8.80 Median PMPM – Sales and Marketing
  • $33.57 Median PMPM – Total Expenses

Note: Data is from the Sherlock Benchmark Summary, Figure 3 (Medicaid Navigator 2014).

Source: Sherlock Company

Is there any hope of bending the health care cost curve?

National Health Expenditure Projections 2013-2023 Forecast Summary

According to recent projections by Centers for Medicare & Medicaid Services:

  • 2013-2023 Health spending projected to grow at an average rate of 5.7%.
  • 2013 Health spending growth remained slow at 3.6%.
  • 2014 Expected health spending growth is 5.6%.
  • 2015-2023 Average annual projected growth will be 6.0%.
  • 2023 Health expenditures financed by federal, state, local governments projected to be 48%.
  • 2012 Health expenditures financed by federal, state, local governments was 44%.
  • 2023 Health spending projected to be 19.3% of Gross Domestic Product.
  • 2012 Health spending was17.2% of Gross Domestic Product.

Source: NHE Projections 2013-2023 – Forecast Summary CMS, September 2014

AHRQ releases guide to help improve Medicaid care

AHRQ releases guide to help improve Medicaid careThe Agency for Healthcare Research and Quality has released a resource designed to support efforts to cut readmissions under Medicaid. The guide is designed to assist acute-care providers comply with CMS standards and establish partnerships. (8/22)

August 25, 2014 | Categories: healthcare,hospitals,Medicaid | Tags: , , , | Comments (0)

Beyond the Medicaid expansion numbers and costs, what can we conclude?

The Affordable Care Actand America’s Cities

According to a report by the Robert Wood Johnson Foundation that estimated the effect of the Affordable Care Act (ACA) on 14 large and diverse cities: Los Angeles, Chicago, Houston, Philadelphia, Phoenix, Indianapolis, Columbus, Charlotte, Detroit, Memphis, Seattle, Denver, Atlanta, and Miami, among the seven cities in states that have expanded Medicaid, the ACA will likely decrease the number of uninsured by an average of 57 percent. City by city, the reduction is projected to vary between 49 percent in Denver and 66 percent in Detroit by 2016. New federal spending on health care from 2014 to 2023 would range from $4.1 billion in Seattle to $27 billion in Los Angeles.

Among the seven cities in states not expanding Medicaid, the ACA will likely decrease the number of uninsured by an average of 30 percent. The decrease would range from 25 percent in Atlanta to 36 percent in Charlotte by 2016. New federal spending due to the ACA from 2014 to 2023 would increase by between $1.9 billion in Atlanta and $9.9 billion in Houston. If Medicaid eligibility were expanded in these cities, the number of uninsured would fall by an average of 52 percent, ranging from 45 percent in Houston to 59 percent in Memphis. New federal spending would increase by between $4.8 billion in Atlanta and $16.4 billion in Houston from 2014 to 2023. Source: Robert Wood Johnson Foundation

FQHCs are responding to the changing health care environment

According to a recent survey, federally qualified health centers are utilizing the following strategies to prepare for expected increased demand:

  • investing in expanded and better-integrated behavioral health services (53%)
  • hiring new medical staff (31%)
  • introducing telemedicine and other technologies that allow patients to access health care remotely (17%)
  • hiring staff to help patients apply for insurance coverage (69%)

Source: “New Survey: Community Health Centers Make Substantial Gains in Health Information Technology Use, Remain Concerned About Ability to Meet Increased Demand Following ACA Coverage Expansions,” The Commonwealth Fund Press Release, May 16, 2014,

Medicaid better than no insurance for hospitals

The Washington Post reported on findings from the first full quarter of results for publicly traded hospitals since ACA implementation.  The data show a noticeable difference in the kinds of patients being treated in “blue” versus “red” states, or Medicaid expansion versus non-expansion states.  “This is generally the kind of trend, though, that hospitals expected to see under the ACA and why they’re lobbying hard for the Medicaid expansion.  They’re getting more patients with Medicaid coverage, which reimburses at rates lower than private coverage, but still pays better than no insurance.  And it suggests that patients with new coverage are seeking care, which backs last week’s finding from the Bureau of Economic Analysis that health-care expenditures climbed 9.9 percent last quarter as coverage expanded.”

Beware of the upcoming insured and uninsured numbers

This from John Goodman’s blog post written by Greg Scanlen

“The new announcement that the Census Bureau is completely changing its Current Population Survey (CPS) questions about health insurance coverage is devastating for those of us who do health research. We have all known for years — decades — that the CPS count of the insured isn’t especially accurate. The questions it asks are about full-year coverage but people tend to answer based on their current status. It chronically under-reports Medicaid enrollment — the actual head count from Medicaid programs is always higher than indicated in the survey. The same is probably true for employment-based coverage. It has often been criticized for being weak on foreign language questions. Massachusetts, for example, has a significant population of people who speak Portuguese and that state thought the CPS failed to capture those people.

The Census Bureau recently (in 2007) revised its numbers because the software was misallocating people who reported that everyone in their family was covered. More on this below. But despite all this, the CPS numbers were very useful. It is an enormous survey of 78,000 households, and since it also asks about employment and income, it is possible to look at very detailed demographic categories. The error rate appears to occur throughout the data, it is not concentrated in any one demographic group, so it is not a factor in comparing sub-groups. And most importantly, it has been going on since 1987, so it is possible to measure changes over time — during, before, and after recessions, before and after new initiatives like the SCHIP program. And the state-by-state numbers are invaluable…

To drop everything that has gone before in favor of a brand new set of questions is unprecedented. And to do so at the very moment of the biggest revision of health care in American history is completely irresponsible. We simply will not be able to compare before and after ObamaCare, at least not based on the CPS. This is a tragedy. It’s not like the CPS hasn’t been revised before. A short paper explaining the 2007 revision lists the more significant changes over the years, including-Converting from paper to digital questionnaires in 1994. Adding child-specific questions in 1995. Adding “verification” questions for people who claimed no insurance in 2000. The 2007 revision explains how the Bureau did not just stop using one data set and switch to another. Instead, it went back two years and revised the numbers for 2005 and 2007 and provided instruments to allow, “advanced users the ability to approximate the correction for 1997 through 2004.”

Both sets of numbers were available for these years to maintain the integrity of the trend lines. If the Bureau were being responsible it would run the old questionnaire alongside the new one for at least three years, so we could measure the effect of ObamaCare independently of the effect of the new survey. That it has chosen not to do this only heightens the suspicion of a political agenda in play and further degrades the reliability and trustworthiness of anything that comes out of the federal bureaucracy in the Obama era.”

– See more at:


Physicians accepting Medicare and Medicaid patients

The trending of the following statistics bears watching as health reform progresses.

According to a recent
survey, while 77% of physicians are accepting Medicare patients, only 50.6% of
physicians surveyed said they accept Medicaid.

Source: ‘Survey shows
patients in many cities wait weeks for appointments,’ Medical Economics,
February 26, 2014,

Sources of Health Insurance in the US

Breakdown of Type of Primary Health Insurance Coverage in The U.S.

Quarter 4 2013

Jan. 2-Feb. 28, 2014

Current or former employer






Plan fully paid for by you or a family member






Military or Veteran’s



A union



Something else



Source: Gallup-Healthways Well-Being Index

Private Insurance is paying more than its share



Real Per Capita National Health Expenditures Annual Growth Rates, by Payer and Spending Category

Historical Average Annual Growth Rate

Average Annual Growth Rate, 2010-2013




Total National Health Expenditures





Major Payers (per enrollee)
Private Insurance















Major Categories of Spending
Hospital Care





Physician and Clinical Services





Prescription Drugs





Home Health and Skilled Nursing Care





Source: White House Council on Economic Advisers

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