4 ms·

Thanks for sharing! Billing codes certainly seem like a significant source of complexity. Another area that seems problematic to me is an apparent surfeit of mi

by paws 4y ago

Thanks for sharing! Billing codes certainly seem like a significant source of complexity. Another area that seems problematic to me is an apparent surfeit of middlemen. What conclusions might we draw from the fact e.g. a "Pharmacy Benefit Manager" is a job that exists only in the US [0]? Why does it feel like my insurance premiums pay for lots of things that are difficult to attribute to actual improved health outcomes? Appreciate your insight. [0] https://www.goerie.com/story/opinion/2021/06/12/op-ed-when-comes-prescription-drugs-pbms-have-power/7617580002/ https://www.goerie.com/story/opinion/2021/06/12/op-ed-when-c...

duffpkg 4y ago
Something that is very little known to most lay people but has profound implications on how the industry is structured are laws loosely called "Corporate Practice of Medicine" (CPOM). A little more than half the states have some version of them. Simply put they require that the organization legally practicing medicine must be owned and operated by people holding medical licenses only. This defacto creates a medical entity for that purpose and a sistered non-medical entity for business operations. Not speaking to the broader reasons of why those laws can potentially be good, the practical result of those laws all but requires many "middle men" in the operation of medical organizations.
- paws 4y ago
  TIL about CPOM, thanks! Another question I'm curious about, if you don't mind, is why there is no apparent urgency in fixing the painful billing experience for patients. (aka "why don't billing coordinators seem to coordinate with the patient front and center?") Seems like lots of people are fearful of medical billing, and not only because it's expensive. I realize providers may be out of network, carriers take time to adjust claims, etc. Still, the staggered/surprise billing seems unique to medicine and a 2nd order effect might be people avoiding preventive care to their own detriment. Say a patient goes to get some procedure done, the medical work is completed in one day. Shortly afterwards they receive bill A. OK, that's fine. But then X months later, they receive bill B with more charges from some provider that they may not even remember. I thought avoiding that was supposed to be the job of a billing coordinator. Presumably coordinators are constrained by "things" -- what are the factors that make this experience so dreadful for patients and why are they not being changed?
  - duffpkg 4y ago
    I'm not sure the short answer is adequate but a few things: 1) US healthcare is absolutely huge, it's perhaps 20% of the total macro economy. Changing anything in 20% of the entire economy is going to take a long time. 2) There has been really significant changes regarding price transparency and "surprise" billing in the past 5 years, so there is momentum to improve the patient experience but see #1 3) Regarding hospitals, many hospitals might appear to be one thing but are not (some systems are fully vertically integrated). They are much more like medical malls, often as a result of CPOM. What you percieve as one thing actually involved dozens of different business entities and hence very discoordinated billing.
- jsmith45 4y ago
  Its not immediately clear to my why such laws should require crazy corporate structures with many middlemen when there exists similar rules that law firms can only be owned by lawyers, and they almost always just have a fairly straightforward partnership scheme for their firms.
refurb 4y ago
The equivalent job of "Pharmacy benefits manager" exists in all systems, public and private. Some entity has to manage reimbursement of pharmacy benefits.
- paws 4y ago
  Anecdata: I can't say "pharmacy benefits managers" work the same across _all_ systems. When I had health insurance in a western European country, I'd get a prescription, buy at a local pharmacy (paying out of pocket), then submit the claim + paperwork to ins carrier and they'd reimburse me minus a copay, I think 25 EUR or so. I can't say with certainty there wasn't some kind of "pharmacy benefits manager" behind the scenes, but everything about the transaction felt simple and like a standard claim. Point being, it's not obvious to me that "all systems" require an entity to handle pharmacy benefits in the way you seem to be saying.
  - lotsofpulp 4y ago
    Presumably, that is because the government in the western European country is stepping in to regulate prices, so the PBM (i.e. health insurance company), is not having to do that. A PBM is just the department of a health insurance company which negotiates with pharmacies and medicine suppliers. Pharmacies are required because society decided a qualified person should be double checking the chemicals that get prescribed to people by a doctor. The health insurance company is an agent on behalf of an unknowledgeable and unable buyer that negotiates healthcare prices and (ideally) adjudicates the care itself to prevent waste or fraud. They would be better labeled managed care organizations (MCO), because people pay them to manage their healthcare in a sense, on top of providing insurance against expenses over the out of pocket maximum. Technically, one or more of all the managed care organization's functions can be performed by the government as a single entity for everyone, and is in many countries. However, the US has decided to go with a very fractured approach, delineating large portions of the population into various tribes that receive various quantity and quality levels of healthcare that is adjudicated by various administrators. On top of this is 50 states with 50 regulatory bodies with 50 different rules around healthcare delivery. Hence, there are a lot of systems and negotiations flying around and a lot of variance in delivery of healthcare.

by paws 4y ago

duffpkg 4y ago

Something that is very little known to most lay people but has profound implications on how the industry is structured are laws loosely called "Corporate Practice of Medicine" (CPOM). A little more than half the states have some version of them. Simply put they require that the organization legally practicing medicine must be owned and operated by people holding medical licenses only. This defacto creates a medical entity for that purpose and a sistered non-medical entity for business operations. Not speaking to the broader reasons of why those laws can potentially be good, the practical result of those laws all but requires many "middle men" in the operation of medical organizations.

paws 4y ago
TIL about CPOM, thanks! Another question I'm curious about, if you don't mind, is why there is no apparent urgency in fixing the painful billing experience for patients. (aka "why don't billing coordinators seem to coordinate with the patient front and center?") Seems like lots of people are fearful of medical billing, and not only because it's expensive. I realize providers may be out of network, carriers take time to adjust claims, etc. Still, the staggered/surprise billing seems unique to medicine and a 2nd order effect might be people avoiding preventive care to their own detriment. Say a patient goes to get some procedure done, the medical work is completed in one day. Shortly afterwards they receive bill A. OK, that's fine. But then X months later, they receive bill B with more charges from some provider that they may not even remember. I thought avoiding that was supposed to be the job of a billing coordinator. Presumably coordinators are constrained by "things" -- what are the factors that make this experience so dreadful for patients and why are they not being changed?
- duffpkg 4y ago
  I'm not sure the short answer is adequate but a few things: 1) US healthcare is absolutely huge, it's perhaps 20% of the total macro economy. Changing anything in 20% of the entire economy is going to take a long time. 2) There has been really significant changes regarding price transparency and "surprise" billing in the past 5 years, so there is momentum to improve the patient experience but see #1 3) Regarding hospitals, many hospitals might appear to be one thing but are not (some systems are fully vertically integrated). They are much more like medical malls, often as a result of CPOM. What you percieve as one thing actually involved dozens of different business entities and hence very discoordinated billing.
jsmith45 4y ago
Its not immediately clear to my why such laws should require crazy corporate structures with many middlemen when there exists similar rules that law firms can only be owned by lawyers, and they almost always just have a fairly straightforward partnership scheme for their firms.

refurb 4y ago

The equivalent job of "Pharmacy benefits manager" exists in all systems, public and private. Some entity has to manage reimbursement of pharmacy benefits.

paws 4y ago
Anecdata: I can't say "pharmacy benefits managers" work the same across _all_ systems. When I had health insurance in a western European country, I'd get a prescription, buy at a local pharmacy (paying out of pocket), then submit the claim + paperwork to ins carrier and they'd reimburse me minus a copay, I think 25 EUR or so. I can't say with certainty there wasn't some kind of "pharmacy benefits manager" behind the scenes, but everything about the transaction felt simple and like a standard claim. Point being, it's not obvious to me that "all systems" require an entity to handle pharmacy benefits in the way you seem to be saying.
- lotsofpulp 4y ago
  Presumably, that is because the government in the western European country is stepping in to regulate prices, so the PBM (i.e. health insurance company), is not having to do that. A PBM is just the department of a health insurance company which negotiates with pharmacies and medicine suppliers. Pharmacies are required because society decided a qualified person should be double checking the chemicals that get prescribed to people by a doctor. The health insurance company is an agent on behalf of an unknowledgeable and unable buyer that negotiates healthcare prices and (ideally) adjudicates the care itself to prevent waste or fraud. They would be better labeled managed care organizations (MCO), because people pay them to manage their healthcare in a sense, on top of providing insurance against expenses over the out of pocket maximum. Technically, one or more of all the managed care organization's functions can be performed by the government as a single entity for everyone, and is in many countries. However, the US has decided to go with a very fractured approach, delineating large portions of the population into various tribes that receive various quantity and quality levels of healthcare that is adjudicated by various administrators. On top of this is 50 states with 50 regulatory bodies with 50 different rules around healthcare delivery. Hence, there are a lot of systems and negotiations flying around and a lot of variance in delivery of healthcare.