An upcoming payment for university hospitals

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The Rise of Medicare Advantage Stock

If you’ve ever needed proof of how much Wall Street is salivating over Medicare Advantage’s profitability, look no further than Humana’s Investor Day last week.

Humana executives gave investors everything they wanted: the company will hire boatloads of seniors over the next three years; its external MA brokers are cleaning up their act so fewer people abandon their projects; it will refer more of its members to its growing division of clinics and home health services; and all of this will lead to a windfall of dividends, share buybacks and surpluses.

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These were very big promises. Wall Street will punish Humana shares for any slower-than-expected listing puff that begins in a month. But it should be noted that Humana – a company that is essentially a pure play MA company – has blown the stock market away for the past decade. The broader S&P 500 and the Dow Jones don’t even compare. It’s all powered by this taxpayer-funded alternative to traditional health insurance. And the things Humana executives didn’t talk about, like the extremely questionable risk-adjustment practices that have been exposed by whistleblowers and auditors for years, have also made a lot of money.

Read the story, which also includes details on the number of medical clinics Humana will acquire and build each year – a clear nod that Humana is thoroughly copying UnitedHealth Group to recruit more doctors so it can keep more of that sweet, sweet MA dollars.

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Collection of residents and scholarship holders

Earlier this month, the Brigham and Women’s Hospital sued the federal government. The famed Boston hospital, part of Mass General Brigham, said it was underpaid for training its junior doctors. It turns out that university hospitals across the country will soon be receiving corrected sums to account for these underpayments.

Medicare is the largest funder of higher medical education. The formula for paying university hospitals to train these doctors is complex, but it depends on the number of residents and fellows at each hospital. A few years ago, other hospitals sued and said Medicare would hire them if they had too many fellows. A court agreed, and in the latest inpatient hospital rule, Medicare updated its formula and said it would apply that formula retroactively for “all teaching hospitals.”

The Brigham and Women lawsuit is essentially a way for the hospital to get in the queue and “facilitate timely payment,” a hospital spokesperson said.

“It’s a procedural necessity to continue to pursue these lawsuits in order to get paid under the new settlement,” said Ron Connelly, an attorney who led the original lawsuit from Milton S. Hershey Medical Center in Pennsylvania and who has since been consolidated to include 63 hospitals.

Medicare has already sent notices that it is recalculating payments, and Connelly expects its hospital customers to be paid by the end of this year. Depending on how many years of underpayments a hospital has appealed, payments can range from $30,000 to $10 million. “It’s really going to vary a lot,” Connelly said.

Expensive Travel Nurses: The New Norm?

Pay rates for travel nurses have cooled since the start of this year, but hospitals are still paying significantly more than before the pandemic. And it could stay that way indefinitely, writes Tara Bannow, my colleague at Health Care Inc.

AMN Healthcare, one of the nation’s largest nurse recruitment companies, expects its billing rates for travel nurses to drop 30% between the first and fourth quarters of 2022, the report said. CFO Jeff Knudson at a banking conference last week. But even that lower rate in the fourth quarter is still 35% higher than in the fourth quarter of 2019.

Much of the current demand is due to a shortage of nurses that predated the pandemic, outgoing AMN CEO Susan Salka told the conference. Covid-19 has compounded the problem as it has caused many exhausted nurses to retire, change careers or take nursing jobs outside of hospitals.

Congress is calling for an investigation into whether staffing companies like AMN have used the pandemic as an excuse to raise hospital prices. Salka admitted that “traveler billing rates have increased,” but countered that some of the biggest cost increases for hospitals were in higher salaries and bonuses for their employed nurses. “And there are demands for those salaries to be increased further by nursing staff,” she said.

Medicare’s randomized trial to fix dialysis

Not enough people with kidney failure are receiving transplants or home dialysis, and Medicare wants to change that, reports my colleague Isabella Cueto.

A new government model will give higher payments to dialysis providers if patients use home dialysis instead of going to a clinic and if providers get more patients on the waiting list for organ transplants . The interesting part of the model is that it requires 30% of dialysis companies to participate – and the remaining 70% will be used as a control group.

Read Isa’s full story, which includes valid concerns about whether the dialysis duopoly of DaVita and Fresenius “might be trying to game the system” by promoting transplants, waiting lists and home dialysis in establishments that must participate, and by promoting these things less in establishments where they do not participate.

Industry bric-a-brac

  • Breaking news Friday: Daniel Haller, the New York surgeon who sued the feds to kill the new surprise billing law, fired his lawyers. It’s unclear whether that means he will appeal his case, which a judge dismissed last month.
  • Have you noticed that some drug websites have a “Talk to a Doctor” message. nowbutton? Well, my colleague Katie Palmer did, and she explained how these telehealth prescriptions are a “dream” for pharmaceutical companies looking for an easy (and clinically questionable) increase in sales. .
  • UnitedHealth won a six-year class action lawsuit against doctors who argued the insurer stiffened them on facility fees, Bloomberg’s Jacklyn Wille reports.
  • The Catholic hospital chain Ascension posted an operating margin of -3.1% for its 2022 financial year ended in June, new audited financial documents To display. Ascension’s net margin was -6.6% as the stock market decline continued to weigh on hospital investment.
  • Rep. Bill Pascrell is calling on the federal government to investigate whether HCA Healthcare is improperly admitting people from the emergency room, reports my colleague Rachel Cohrs. Envision Healthcare also makes an appearance in Pascrell’s letter.
  • The Census Bureau released its Annual Report on health insurance. The 8.3% uninsured rate was the headline figure, but two other pieces of data tell a clearer story: Hispanics are still more than twice as likely to be uninsured (18.3%), and people living in states that have not expanded Medicaid continue to lack insurance at much higher rates (11.9%).

The Meme District