UnitedHealth - Steven Wevodau
Layoff side effect: health-care loss
Insurer settles in New York state for $50 million - posted by Steven Wevodau
By Rob Varnon
STAFF WRITER
Updated: 01/20/2009 12:22:33 AM EST
Minnesota-based UnitedHealth Group, which has a large presence in Connecticut, said on Jan. 13 it approved a $50 million agreement to settle price-gouging allegations.
United Health Group’s problems started in February 2008, when New York Attorney General Andrew Cuomo — in response to complaints in his state — announced he was investigating its Igenix Inc. subsidiary, which operates computer databases used to determine reimbursement rates for medical procedures.
UnitedHealth agreed to pay the $50 million to establish an independent database that will replace its Ingenix database products.
The new nonprofit organization will also have to give consumers information about medical costs.
A court must still decide whether there is any underpayment. There was no mention of patients seeing some sort of repayment.
UnitedHealth would not comment on the issue beyond its press release.
The company said there will be no impact on jobs at its Ingenix facility in Rocky Hill, or its Trumbull UnitedHealth and Oxford Health Plans operations.
“For the past 10 years, American patients have suffered from unfair reimbursements for critical medical services due to a conflict-ridden system that has been owned, operated and manipulated by the health insurance industry,” Cuomo said in a press release. “This agreement marks the end of a flawed system.”
Shares of UnitedHealth closed down 26 cents to $25.36 in trading on the New York Stock Exchange.
Cuomo’s office began investigating complaints that Ingenix-produced numbers for out-of-network expenses were far lower than what doctors were charging, which meant UnitedHealth customers were paying too much.
When a person uses an out-of-network doctor for treatment, the insurer usually promises to pay a portion, generally 80 percent, of the bill based on a database that catalogs the cost of medical treatments across the country.
For example, if a doctor charges $200 for a procedure when the database says the usual rate is $100, the insurer would only pay 80 percent of the database price, or $80, leaving the patient to pay the remaining $120.
Because Ingenix is used by almost every other health insurance company in the nation, Cuomo said his investigation is continuing into those companies.
The New York Attorney General won praise from Connecticut Attorney General Richard Blumenthal.
“Today’s settlement between New York and UnitedHealth Group — eventually establishing a new reimbursement rate system — is a significant step toward protecting patients who may have been shortchanged millions of dollars over several years by insurers,” Blumenthal said in a prepared statement.
He is conducting his own investigation into the matter.
“My investigation into UnitedHealth Group, its Ingenix subsidiary and several other insurers is continuing to ensure that any company that may have misused or manipulated reimbursement rates is held accountable, including possible restitution for consumers.”
Blumenthal and Cuomo said a major concern was that Ingenix, owned by one insurer and collecting fees from others, was beholden to the insurance industry and was therefore compromised in its ability to deliver unbiased price information.
Mark Thompson, executive director of the Fairfield County Medical Association, which represents doctors, said the county’s doctors and patients have been hit with unfair reimbursement rates for years, but no one has done anything about it until now.
“We were questioning a decade ago the veracity of the information that the insurance companies were submitting as the usual charge,” said Thompson. “We talked to our legislators about that. We talked to the insurance companies, and when we asked them to show us how they came up with their data, they said it was proprietary.”
“It’s kind of like the Madoff situation. There were red flags going up,” Thompson said, referring to allegations of a $50 billion Ponzi scheme.
He said he hopes Cuomo’s actions lead to changes in Connecticut, as well.
Hartford-based Aetna Inc. and Bloomfield-based Cigna Corp. have also been subpoenaed by Cuomo about their use of Ingenix rates.
In a prepared statement, Aetna praised the move to an independent, nonprofit organization that will provide this data in the future.
Cigna noted this agreement does not involve it and said it uses Ingenix properly.
Cigna said this situation has occurred in part because consumers have not been given access to the real costs of health care, and the company supports efforts to do that.
Material from the Associated Press was used in this report.
Omnicare Comments on Summary Judgment Ruling in UnitedHealth Group Case
Posted by Steven Wevodau
COVINGTON, Ky.–(BUSINESS WIRE)–Omnicare, Inc. (NYSE:OCR), one of the nation’s leading providers of pharmaceutical care for the elderly, today issued the following statement concerning a ruling by the US District Court of Northern Illinois granting a summary judgment motion filed by UnitedHealth Group Incorporated (NYSE: UNH) and its subsidiaries PacifiCare Health Systems, Inc. and RxSolutions, Inc., which does business as Prescriptions Solutions (collectively, “United”), in Omnicare’s lawsuit against United:
We do not agree with this ruling and we continue to believe our claims against United are strong. The Company has been advised by its legal advisors that there are valid and compelling grounds for appeal and the Company will do so promptly.
Omnicare, Inc. (NYSE:OCR), a Fortune 500 company based in Covington, Kentucky, is a leading provider of pharmaceutical care for the elderly. Omnicare serves residents in long-term care facilities, chronic care and other settings comprising approximately 1.4 million beds in 47 states, the District of Columbia and Canada. Omnicare is the largest U.S. provider of professional pharmacy, related consulting and data management services for skilled nursing, assisted living and other institutional healthcare providers as well as for hospice patients in homecare and other settings. Omnicare’s pharmacy services also include distribution and product support services for specialty pharmaceuticals. Omnicare offers clinical research services for the pharmaceutical and biotechnology and medical device industries in 30 countries worldwide. For more information, visit the company’s Web site at www.omnicare.com.
Forward-Looking Statements
In addition to historical information, this press release contains certain statements that constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include, but are not limited to, all statements regarding the intent, belief or current expectations regarding the matters discussed or incorporated by reference in this document (including statements as to “beliefs,” “expectations,” “anticipations,” “intentions” or similar words) and all statements which are not statements of historical fact. Such forward-looking statements, together with other statements that are not historical, are based on management’s current expectations and involve known and unknown risks, uncertainties, contingencies and other factors that could cause results, performance or achievements to differ materially from those stated. The most significant of these risks and uncertainties are described in the Company’s Form 10-K, Form 10-Q and Form 8-K reports filed with the Securities and Exchange Commission and include, but are not limited to: overall economic, financial, political and business conditions; trends in the long-term healthcare, pharmaceutical and contract research industries; the ability to attract new clients and service contracts and retain existing clients and service contracts; the ability to consummate pending acquisitions; trends for the continued growth of the Company’s businesses; trends in drug pricing; delays and reductions in reimbursement by the government and other payors to customers and to the Company; the overall financial condition of the Company’s customers and the ability of the Company to assess and react to such financial condition of its customers; the ability of vendors and business partners to continue to provide products and services to the Company; the continued successful integration of acquired companies; the continued availability of suitable acquisition candidates; the ability to attract and retain needed management; competition for qualified staff in the healthcare industry; the demand for the Company’s products and services; variations in costs or expenses; the ability to implement productivity, consolidation and cost reduction efforts and to realize anticipated benefits; the ability of clinical research projects to produce revenues in future periods; the potential impact of legislation, government regulations, and other government action and/or executive orders, including those relating to Medicare Part D, including its implementing regulations and any subregulatory guidance, reimbursement and drug pricing policies and changes in the interpretation and application of such policies; government budgetary pressures and shifting priorities; federal and state budget shortfalls; efforts by payors to control costs; changes to or termination of the Company’s contracts with Medicare Part D plan sponsors or to the proportion of the Company’s Part D business covered by specific contracts; the outcome of litigation; potential liability for losses not covered by, or in excess of, insurance; the impact of differences in actuarial assumptions and estimates as compared to eventual outcomes; events or circumstances which result in an impairment of assets, including but not limited to, goodwill; market conditions; the outcome of audit, compliance, administrative, regulatory or investigatory reviews; volatility in the market for the Company’s stock and in the financial markets generally; access to adequate capital and financing; changes in international economic and political conditions and currency fluctuations between the U.S. dollar and other currencies; changes in tax laws and regulations; changes in accounting rules and standards; and costs to comply with the Company’s Corporate Integrity Agreements. Should one or more of these risks or uncertainties materialize or should underlying assumptions prove incorrect, the Company’s actual results, performance or achievements could differ materially from those expressed in, or implied by, such forward-looking statements. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. Except as otherwise required by law, the Company does not undertake any obligation to publicly release any revisions to these forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.
For more information on Omnicare, Inc., visit www.omnicare.com.
Contacts
Omnicare, Inc.
Cheryl D. Hodges, 859-392-3331
UnitedHealthcare Launches First Diabetes Plan With Incentives For Preventive Care - Steven Wevodau
UnitedHealthcare, a UnitedHealth Group (NYSE:UNH) company, is introducing a health care plan designed to help the rapidly growing numbers of diabetics and pre-diabetics manage their conditions more effectively while controlling employers’ escalating costs of insuring them.
The first-of-its-kind Diabetes Health Plan will reward diabetic and pre-diabetic individuals who routinely follow independent, medically proven steps to help manage their condition - such as regular blood sugar checks, routine exams and preventive screenings - and use wellness coaching. Benefits include some diabetes supplies and diabetes-related prescription drugs at no charge, as well as lower co-payments for related doctor visits, at an estimated savings of up to $500 a year.
“The Diabetes Health Plan provides incentives to empower diabetics and pre-diabetics to take charge of their health and well-being, helping them delay or prevent the onset of dangerous diabetic complications later in life, which in turn should help employers lower the cost of providing health benefits,” said Sam Ho, M.D., UnitedHealthcare’s executive vice president and chief medical officer.
According to the American Diabetes Association (ADA), in 2007 nearly 24 million people in the U.S. had diabetes, 24 percent of whom were undiagnosed. Another 57 million are considered pre-diabetic, with about a fourth of them unaware of their condition.
Data from the Centers for Disease Control and Prevention show that two-thirds of all diabetics do not follow their physicians’ advice on how to manage their disease. Experts say out-of-pocket costs for recommended supplies, medicines and physician-visit co-pays are a key reason why many diabetics do not follow treatment guidelines. Another is lack of knowledge about diabetes and pre-diabetic conditions. By lowering financial barriers and providing wellness coaching, training and information, and a real-time compliance monitoring system and personal health record, UnitedHealthcare’s Diabetes Health Plan provides many new incentives to help people better manage their health.
UnitedHealthcare anticipates that increased preventive steps by Diabetes Health Plan participants can help lower health care costs for employers. Total estimated annual cost of a diabetic is greater than $22,000 a year, which is 13-times higher than the average cost of a “healthy” employee (defined as an individual with no chronic disease), according to UnitedHealthcare data.
Targeting a bigger population segment
“Disease-management programs have traditionally focused on complications for people already known to have diabetes,” said Deneen Vojta, M.D., UnitedHealthcare’s vice president, clinical innovation. “We are targeting a much bigger segment of the population with the Diabetes Health Plan. Our objective is to slow the progression of the disease for people with diabetes, and in as many cases as possible to reverse the condition for people in the pre-diabetes stage.”
Progress on both fronts could save U.S. employers billions of dollars, she said, and could help slow or reduce the escalating costs for health care. The cost of diabetes to the U.S. economy has increased 32 percent since 2002, or $8 billion a year, reaching $174 billion in 2007, according to estimates by the ADA. The disease also takes a significant toll on the resources of the U.S. health care system. One out of every five health care dollars is spent caring for someone with diagnosed diabetes, while one in 10 health care dollars is attributed directly to diabetes, according to the ADA.
UnitedHealthcare employer-specific studies show that the estimated average cost for treating pre-diabetic patients is $5,000. For previously undiagnosed diabetics, the expected annual cost is $12,000; and for diabetics without complications that often afflict people with the disease, the annual cost is $10,000. The average annual cost for diagnosed diabetics with complications, such as heart disease or kidney failure, can soar to $30,000.
Early detection and self-management are key
“The key to our program is to engage individuals as soon as possible and design personalized, specific self-management steps for them that can decrease the odds they will move into higher-cost categories of treatment,” Dr. Vojta said. “For example, research shows that a typical person in the pre-diabetic group who reduces body weight by 7 percent through activities such as adopting better eating habits or walking 150 minutes per week reduces the risk of becoming diabetic by 58 percent.”
A decades-long epidemic of obesity in the U.S. is a major reason for the sharply rising numbers of diabetic and pre-diabetic adult Americans. Diagnoses of people with diabetes increased by 13.5 percent between 2005 and 2007, with 1.6 million new cases reported in 2007 alone, according to the ADA.
“There is a massive, untapped opportunity for millions of American who have pre-diabetes diagnoses to stop, and perhaps even reverse, the progress of the disease before it’s too late,” Dr. Ho said. “By encouraging them to take the right preventive steps, with clear incentives including lower out-of-pocket costs, we can help people improve the quality of their lives.”
No charge for self-care training, diabetes-related drugs and services
Diabetes Health Plan participants who regularly follow their treatment plans can receive access to online monitoring and education tools at no charge, in addition to self-monitoring training and certain diabetes-related drugs (insulin, oral anti-glycemics, ARB and ACE, anti-depressants and statins) and services. In addition, the plan provides a voluntary screening model to help individuals determine if they have undiagnosed diabetes or suffer from pre-diabetes conditions. To remain enrolled in the program, participants must comply with diabetes and preventive care evidence-based guidelines.
The Diabetes Health Plan is available to self-insured commercial health plan customers and their family members with diabetes or pre-diabetes.* Employers have the option of offering the program as a standalone health plan or as an enhancement to an existing traditional plan.
Read this Diabetes Fact Sheet from the Centers for Disease Control and Prevention to learn more about the disease.
About UnitedHealthcare
UnitedHealthcare provides a full spectrum of consumer-oriented health benefit plans and services to individuals, public sector employers and businesses of all sizes, including more than half of the Fortune 100 companies. The company organizes access to quality, affordable health care services on behalf of more than 26 million individual consumers, contracting directly with more than 570,000 physicians and care professionals and nearly 4,900 hospitals to offer them broad, convenient access to services nationwide. UnitedHealthcare is one of the businesses of UnitedHealth Group (NYSE: UNH), a diversified Fortune 50 health and well-being company.
* Self-insured plans generally are used only by larger employers, with claims administered by an insurance company. The employer itself is responsible for paying covered health care costs for participating employees and family members.
Original article posted on Medical News Today.
Walgreen announces Complete Care wellness program
posted by Steven Wevodau
NEW YORK — Walgreen Co. said Wednesday it is rolling out a program it says will save employers and health insurers money, while giving discounts to employees at its brand name drugstores.
The program, called Complete Care and Well-Being program, is being launched through Walgreen’s Take Care Health Systems business. Deerfield, Ill.-based Walgreen said Complete Care will offer clear pricing to employers and give workers a 15 percent discount on Walgreen brand products and lower prices on prescription drugs.
The company did not offer any details on the cost of starting the program.
Walgreen operates more than 300 work site health centers at manufacturing facilities and employer campuses. At those centers, workers can see doctors and nurses for consultations, physicals and urgent care at the clinics as well as filling prescriptions and getting help with medication.
Walgreen says Complete Care and Well-Being will also help to health insurers and pharmacy benefits managers. It said the program will lead to greater satisfaction for patients, who can be seen quickly at clinics and get the discounts, while benefiting insurers and PBMs by reducing health care costs and making sure patients with chronic illnesses keep taking their prescriptions.
Walgreen has its own pharmacy benefits management business, called Walgreens Health Initiatives.
The company runs 6,636 drugstores in 49 states, and said half the U.S. population lives within two miles of at least one of its stores.
Walgreen bought Take Care Health Systems in May 2007. Take Care operates 322 clinics in Walgreen stores, and has entered partnerships with health insurers including Aetna Inc., Cigna Corp., Coventry Health Care Inc., Humana Inc., UnitedHealth Group Inc.
Health insurer settles with NY over bill database
posted by Steven Wevodau
The Associated Press
Under a settlement with New York, UnitedHealth Group, one of the nation’s largest insurers, will overhaul the industry’s databases to make sure patients are fully reimbursed for care when they use physicians outside their insurance network.
The settlement is national in scope and could help millions of Americans because UnitedHealth operates the health care industry’s databases under its Ingenix business unit.
Patients appear to have been shortchanged by as much as 28 percent because the database would allow payment under what it listed as the local rate, which could be less than the doctor charged.
A UnitedHealth spokesman didn’t immediately comment.
The New York Times first reported the settlement with the state attorney general’s office on Tuesday.
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