The Obamacare Debacle: It's Everyone Else's Fault

Tyler Durden's picture




 

As the Congressional hearing, to apportion blame for the farce that Obamacare has already become, gathers steam the overwhelming theme from the four witnesses is "it's not our fault," and as much as the Congressmen dive deeply into the process, the more it is clear that the left hand had no idea what the right hand was doing in yet another government-funded SNAFU. The entire discussion can be summed up by CGI's comments that "our portion of the application worked as designed." Indeed, all of the contractors point the finger back at the government's Centers for Medicare and Medicaid as responsible for "end to end testing," and ultimately the #fail.

 

Live Coverage via C-SPAN (click image for link)

 

Written statements from the 4 contractors:

 

Via WSJ,

According to prepared testimony, CGI Federal, the lead contractor for HealthCare.gov, will say the federal agency in charge of the project was "the ultimate responsible party for the end-to-end performance of the overall" health exchange.

 

...

 

CGI also said its system passed eight technical reviews before going live and that problems came instead from a system designed by another contractor, UnitedHealth Group Inc 's Optum unit, which verifies users' identities. That "created a bottleneck that prevented the vast majority of users from accessing" the exchange, according to testimony of Cheryl Campbell, a senior vice president at CGI Federal.

 

...

 

Committee Chairman Fred Upton of Michigan  asks the contractors if they knew the site would have “crippling problems.” CGI’s Campbell says that “our portion of the application worked as designed” and repeated that “end-to-end testing was the responsibility of the (Centers for Medicare & Medicaid).”

 

“We anticipate that people will be able to enroll in the time that is allotted,” said CGI’s Campbell (which is Dec. 15 if you want insurance on Jan. 1). “As painful as it sounds, I know it’s a difficult system, but the system is working.”

 

...

In summation, it seems that the following sums it up all too poerfectly...

“If there was a silver bullet to answer that question, I would give it to you,” says CGI’s Campbell. “It’s the end-to-end aspect that is a challenge.”

In other words, whoever was running the overall project was asleep at the wheel...

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Thu, 10/24/2013 - 11:19 | 4086376 PartysOver
PartysOver's picture

Just Bush's fault

Thu, 10/24/2013 - 11:21 | 4086383 Gamma735
Gamma735's picture

Nah. It is just one person's fault and that is Obama. 

Thu, 10/24/2013 - 11:31 | 4086417 hedgeless_horseman
hedgeless_horseman's picture

 

 

The following provision, in a nation of deadbeats that cannot put their hands on $2,000 cash for an emergency, when combined with $2,000 deductibles and 70/30 co-pays, is going to be the mother-of-all-unintended-consequences.

Furthermore, health plans from the marketplace could present financial obstacles for physicians, because those health plans are required to have a 90-day grace period for policyholders that do not pay their monthly premiums on time. While other health plans would cut off coverage if a patient did not pay their bill on time, the health plans offered in the marketplace would still indicate the patient was covered during that grace period, and retroactively revoke payments to the physician for treatment provided during that time. In those situations, the doctor would be forced to seek payment from the patient for services already provided.

 

http://www.kaiserhealthnews.org/Stories/2013/October/21/Texas-Doctors-Un...

 

Short providers, long insurers, long collection agencies.

Thu, 10/24/2013 - 11:32 | 4086437 jcaz
jcaz's picture

Absolutely correct-  just what Shaniqua's crew lobbied for ......

Will be amusing to watch the docs go on strike once they realize they're being bent over on this deal......

Thu, 10/24/2013 - 11:35 | 4086450 GetZeeGold
GetZeeGold's picture

 

 

 

Once Bush put out the plan for America's demise.....nothing could stop it.

 

P.S. watch out for the ACA trolls!

Thu, 10/24/2013 - 11:37 | 4086459 Yes We Can. But...
Yes We Can. But Lets Not.'s picture

Testifying next week: Supercilious Kathleen Sebelius

Thu, 10/24/2013 - 11:42 | 4086478 hedgeless_horseman
hedgeless_horseman's picture

 

 

The insurance company lawyers and actuaries that wrote Obamacare are very intelligent.  The government workers that must implement it are fucking retards.

Thu, 10/24/2013 - 11:42 | 4086489 BaBaBouy
BaBaBouy's picture

FUNNY Eh...
The Repubs' Were RIGHT.
DEFUND UbamaCare DEBACLE.

Thu, 10/24/2013 - 11:46 | 4086508 knukles
knukles's picture

Telling Freudian Slip.

One of the Insurance Execs on the Sunday Press Reach Arounds said something like:  "We got a lot riding on this."

Yeah, a program of the peasantry subsidizing the profits of the health insurers at the point of a spear.

Thu, 10/24/2013 - 12:17 | 4086666 Herd Redirectio...
Herd Redirection Committee's picture

My father is a doc, and my sister is just finishing Medical School.  In Canada, though, not the US!

Suffice to say, the docs are going to catch on quick.

Thu, 10/24/2013 - 12:19 | 4086678 Meat Hammer
Meat Hammer's picture

the docs are going to catch on quick

Wait, I think I've heard this before.......something about the law of unintended consequences, or something like that.

Thu, 10/24/2013 - 12:24 | 4086705 Vampyroteuthis ...
Vampyroteuthis infernalis's picture

This mess is expained with three simple concepts of gov't contractors,

1) Expect high quality, large projects on a lack of funding with too tight a schedule. Anyone who is competent will not bid at this point.

2) Hire incompetent contractors (i.e. politically correct "minorities")

3) Hold no one accountable.

My father worked for the US government and can explain it all in a nutshell.

Thu, 10/24/2013 - 12:47 | 4086836 Joe Davola
Joe Davola's picture

If only they'd been huddling instead of standup scrums.

http://www.youtube.com/watch?v=Azl4nqLn4-Y

Thu, 10/24/2013 - 12:53 | 4086867 Troll Magnet
Troll Magnet's picture

umm..we didn't build it?

Thu, 10/24/2013 - 12:25 | 4086710 redpill
redpill's picture

Who says it's unintended?

Thu, 10/24/2013 - 12:32 | 4086762 Meat Hammer
Meat Hammer's picture

+1

Thu, 10/24/2013 - 14:15 | 4087238 TeamDepends
TeamDepends's picture

Ouch, stop Cloward-Pivening me!  Stop it!

Thu, 10/24/2013 - 14:59 | 4087463 icanhasbailout
icanhasbailout's picture

Doctors in general are nowhere near as smart as popular myth would have you believe. Doctors get bent over on the business end all the time and most have little clue that it's happening, and wouldn't be able to figure out what to do about it if they did.

Thu, 10/24/2013 - 11:44 | 4086480 BaBaBouy
BaBaBouy's picture

...

Thu, 10/24/2013 - 11:41 | 4086485 r101958
r101958's picture

S.O.S.D.D. (Same Old Schmidt, Different Day!).

Thu, 10/24/2013 - 11:44 | 4086494 knukles
knukles's picture

Man, I could make a fortune as a professional "testifyer" for people.  All my life I been telling everybody that it's "Not my fault.  It's everybody elses.  Who me? I wasn't there, nobody saw me, you've got no witnesses. I've excuses.  I got alibis.  They said they wanted it that way.  I did what I was told.  Just following orders. I don't know whatchur talkin' about.  FFS, leave me alone.  I don't know."

I'm a professional at this shit.  I could sit in for everybody so they wouldn't waste their precious government paid useless time.
And Congress Would Still Get As Much Information as it Gets Now.

Thu, 10/24/2013 - 21:01 | 4088677 Himins
Himins's picture

^^^^THAT^^^^ FUCK I LOVE YOU

Thu, 10/24/2013 - 11:41 | 4086482 CaptainObvious
CaptainObvious's picture

"'I quit when medicine was placed under State control, some years ago,' said Dr. Hendricks. 'Do you know the skill it demands, and the years of passionate, merciless, excruciating devotion that go to acquire that skill?  That was what I would not place at the disposal of men whose sole qualification to rule me was their capacity to spout fradulent generalities that got them elected to the privilege of enforcing their wishes at the point of a gun.'"

~ Dr. Hendricks, on why he went Galt, Atlas Shrugged

Thu, 10/24/2013 - 12:13 | 4086640 alangreedspank
alangreedspank's picture

They've realized this for a long time. ACA aka The Herding of Doctors and Patient at Gunpoint

Thu, 10/24/2013 - 17:16 | 4088039 Quantum Nucleonics
Quantum Nucleonics's picture

Most doctors are fairly bright people, and many of them saw this coming.  That's why they are either (a) closing shop and going on salary with hospitals, (b) closing shop and retiring, or (c) switching to a concierge model.

Thu, 10/24/2013 - 11:32 | 4086441 ParkAveFlasher
ParkAveFlasher's picture

long collection agencies.

 

I'm following PRAA.  Charts like a ride in the country.

Thu, 10/24/2013 - 11:33 | 4086444 King_of_simpletons
King_of_simpletons's picture

What's with the 90 day limit these days ?

Thu, 10/24/2013 - 12:11 | 4086453 hedgeless_horseman
hedgeless_horseman's picture

 

 

It has been 30 days for almost all commercial plans.  You don't get to have surgery this month unless you have paid your premium for this month, so the carrier will then guarantee the provider gets reimbursed.

The 90 days grace period, when combined with the ability to recoup all payments to providers when, not if, the poor sick or injured fuckers cannot pay the third month's premium BECAUSE of the $2,000 deductible and 30% co-insurance, is a HUGE FUCKING GIFT TO THE INSURERS.  THEY GET TO COLLECT THE PREMIUMS UNTIL THE PERSON GETS SICK OR INJURED, THEN THE POOR DEADBEAT, BUT MORE LIKELY THE PROVIDER, GETS STUCK WITH THE BILL.  Patient gets treated, insurance company gets premium while patient is healthy, and the only ones that lose are the providers.

1)  Collect Premiums

2)  Don't pay providers

3)  Profit!

Thu, 10/24/2013 - 12:16 | 4086658 vxpatel
vxpatel's picture

So far i've learned more about the ACA through your posts than the hours of talking meat puppets on the network....thanks for your great posts....

Thu, 10/24/2013 - 12:20 | 4086684 Herd Redirectio...
Herd Redirection Committee's picture

"recoup all payments to providers"

I imagine when docs start seeing 3 or 4 of these 'recoup'ings on each bank statement, they will probably lose their minds.

Thu, 10/24/2013 - 12:21 | 4086691 vxpatel
vxpatel's picture

so far none of my friends that are doctors have been impressed by ACA, most in fact are thinking of ways to avoid it...

Thu, 10/24/2013 - 12:58 | 4086730 hedgeless_horseman
hedgeless_horseman's picture

 

 

I imagine when docs start seeing 3 or 4 of these 'recoup'ings on each bank statement, they will probably lose their minds.

 The average practice size is just under two physicians, meaning there are many sole practitioners, many of which have either their their wife or a nurse running the business.

Greater than 90% of physicians offices will never notice the recoupments because they do not post the payments, make the contractual adjustments, collect the patient's amount due under the deductible and co-insurance, or appeal underpayments.  They just deposit the check and spend it.

In fact, providers are essentially prohibited from doing any of the above, by the insurers, because other than Medicare, the insurance companies do not make the contracted fee schedule readily available to the providers.  The contracts ALWAYS come with either a totally blank fee schedule attached as Exhibit A, or "representative listing" of 10 CPT codes, 9 of which are unrelated to the providers practice. 

Don't believe me?  Ask your doctor to tell you what the contracted-allowable fee is that he or she has agreed to accept from your insurer for whatever procedure or visit you are receiving.  This is not the the usual and customary fee that doctors charge, but the amount the insurers are required to pay.  The chances are better than 90% that they will not give you the correct amount, which you will see eventually when you receive the Explanation of Benefits from the insurance company.

Question:  How can the docs know what they are owed if they don't know the contracted price? 

Answer: They cannot. 

Ha ha ha ha! Insurance Companies For The Mother Fucking Win!

 

Short providers, long insurers, long collection agencies.

Thu, 10/24/2013 - 13:10 | 4086958 vxpatel
vxpatel's picture

The $50 office visit, cash only, no tests, just good ole fashion diagnosis based in intuition will come back into vogue. Which is exactly what we need, a return to doctors who remember how to think.

Thu, 10/24/2013 - 13:38 | 4087093 Herd Redirectio...
Herd Redirection Committee's picture

So you are saying the insurers will just withhold money from you?

For eg. you are paid $6000, then the patient is unable to pay their deductible and premiums, then instead of recouping that amount from you, they just net the amount to be recouped against amounts due?

Looks like there will be work for accountants...

Thu, 10/24/2013 - 13:46 | 4087106 hedgeless_horseman
hedgeless_horseman's picture

 

 

...they just net the amount to be recouped against amounts due...

Yes, that is how it is done.

No work for accountants, because CPAs don't understand any of this shit, the facts are too unbelievable and farcical for their brains to accept.

Thu, 10/24/2013 - 14:53 | 4087430 HoofHearted
HoofHearted's picture

I lived in France, and this was exactly the way things were done. We always went wit hthe private doctors not worried about CYA. They were a better quality of doctor. All of them had offices near an ATM. When they got to know us, they were willing to take a check, but typically they ask for cash. They will write you a receipt if you want to claim insurance, but they will not file insurance. We often went t othe American Hospital in Paris. The chief of pediatrics came in one Saturday just to see our son. I think his fee was 55 or 60 euros, and it had to be in cash. He even pointed to the ATM in the lobby if we didn't have the cash on us. He wouldn't take a check or a credit card. I handed him the euro notes and thanked him, wondering why things are so difficult here.

My daughter had to have an MRI after a concussion. We went to the Necker children's hospital in Paris, the top one in all of France. It was late at night when we got done. Thankfully my daughter was ok by then. I asked who I should pay, tha twe were just back visiting, that I needed to pay by credit card, that we were headed back to the States in two days. They said (approximately), "The people who take the money are no longer working for the night." I gave them my address in the US, and I asked, "Will you send the bill?" The receptionist said, "Maybe." The doctor laughed and said, "I don't think so." The bill there was 220 euros. When another daughter had to have the same procedure here in the States, the bill was over $12k. Something has to give...

Thu, 10/24/2013 - 16:26 | 4087870 vxpatel
vxpatel's picture

But we have freedom! and the Frech are socialists! and we have the best healthcare in the world...but, but, but!

Thu, 10/24/2013 - 19:27 | 4088437 MisterMousePotato
MisterMousePotato's picture

Hey, Wise Guy ... America *is* the greatest country in the world:

http://www.youtube.com/watch?v=VMqcLUqYqrs

Thu, 10/24/2013 - 13:55 | 4087153 MachoMan
MachoMan's picture

This is kind of true and only applies to certain practices...

Virtually all contracts with insurance companies, especially for the non-uber-medical facility/hospital group, are adhesion contracts.  The terms of these contracts are completely dictated by the insurance companies.  They typically (virtually always) reference an exhibit which is a fee schedule.  The master fee schedule is hundreds of pages long and, practically speaking, cannot be attached to a contract.  Further, these contracts are confidential so a practitioner of psychology doesn't need to know the reimbursement rate for ankle surgery.

However, THEY ARE REQUIRED TO PROVIDE YOU WITH THE FEE SCHEDULE RELEVANT TO YOUR PRACTICE.  Moreover, it is the practitioner's responsibility to ask for it from his representative.  These rates are subject to change, but the insurance company will typically notify practitioners well in advance of the changes.  Further, in the event you want to terminate the contract, there is typically a short notice duration, e.g. 30 days (unlike a lease that requires you to stay put for years at a time).

I've done this stuff first hand and spoken to many other practitioners and office managers who've done it...

PS, if you think that a solo practitioner has no idea what the reimbursement rate for a particular service is, then you're crazy...  the reimbursement rate is exactly what is used to determine his pricing for services, i.e. there is no point in leaving any money on the table if insurance will pay more for a service [some contracts have language regarding billing insurance the lesser of your stated rate or the insurance company's allowable amount]. 

Thu, 10/24/2013 - 14:12 | 4087183 hedgeless_horseman
hedgeless_horseman's picture

 

 

THEY ARE REQUIRED TO PROVIDE YOU WITH THE FEE SCHEDULE RELEVANT TO YOUR
PRACTICE.  Moreover, it is the practitioner's responsibility to ask for
it from his representative.

True on both accounts.  However, the reality is entirely different.

 

PS, if you think that a solo practitioner has no idea what the
reimbursement rate for a particular service is, then you're crazy... 
the reimbursement rate is exactly what is used to determine his pricing
for services
, i.e. there is no point in leaving any money on the table
if insurance will pay more for a service [some contracts have language
regarding billing insurance the lesser of your stated rate or the
insurance company's allowable amount].

You are ignorant of the facts.  Under Federal Law, providers MUST charge everyone the same fee...what you refer to as pricing.  These usual and customary fees, for most providers, are set well above what the provider believes to be the highest contracted allowable, usually workers comp, in order to not get dinged on the "lesser of billed charges or contracted allowable" term of all contracts.

Nonetheless, it is easy enough to see if I am crazy.  Just run the test I described, above... 

Ask your doctor to tell you what the contracted-allowable fee
is that he or she has agreed to accept from your insurer for whatever
procedure or visit you are receiving.  This is not the the usual and customary fee
that doctors charge, but the amount the insurers are required to pay. 
The chances are better than 90% that they will not give you the correct
amount, which you will see eventually when you receive the Explanation
of Benefits from the insurance company.

Thu, 10/24/2013 - 20:17 | 4088550 MachoMan
MachoMan's picture

So...  doctors use the highest reimbursement rates from insurance companies to determine how much they charge patients, but yet don't know the reimbursement rates...  got it.

Fri, 10/25/2013 - 14:27 | 4090845 hedgeless_horseman
hedgeless_horseman's picture

 

 

Most use 2x or 2.25x the Medicare rate, which they do know, as I described.

Thu, 10/24/2013 - 13:57 | 4087164 Withdrawn Sanction
Withdrawn Sanction's picture

Short providers, long insurers, long collection agencies.

That's the second time I've seen that little nugget of investment "advice," which I assume was tongue in cheek.  Of course, it may in fact work short-run (assuming you can pull the rip cord fast enough), but not long-run.  Screwing providers AND users of healthcare is just bad arithmetic on the insurers/govt's part.  Not quite sure what they think they'll get away with but it's dead end thinking.

Fast forward a few years, after this suppurating pustule called ACA has festered, and doctors are livid about being royally screwed (and their patients are too).  A man, let's call him Barry Soetoro (govt type largely responsible for the mess the ER doctor finds himself in, or at least that's the doctor's informed opinion), shows up for emergency surgery, w/o which Barry will surely perish.  Exactly what is poor old Barry counting on when he's laying there all splayed out on the operating table?  The kindness of strangers?  Good luck w/that.

Thu, 10/24/2013 - 14:40 | 4087380 Mark Urbo
Mark Urbo's picture

Your comments are not reality based. Typical practices have adapted a far more scrutinized business environment as margins have decreased. Their business models are build on reimbursement codes and the processing of such information.  The system/paperwork/filter process is sadly the important priority as opposed to patient interface and care.

Your bias is towards the insurance companies when in reality its the intersection of govt regulations that creates this mess. The key is that under Obamacare (ACA) it will go from barely manageable (in term of our business models) to unmanageable.  The net effect of it being unmanageable is that will implode upon itself (for some of the reasons you suggest) and require a larger step towards a greater govt system (socialist type) at which point the insurance companies will be history as well.  

In the end its not a win for insurance companies, only for govt control of the system.  Ledger games aside, I assure you that the quality of health care will plummet at a unimaginable rate - faster than the current realization on the [non] effectiveness of the ACA enrollment site...

 

 

 

Thu, 10/24/2013 - 15:00 | 4087428 hedgeless_horseman
hedgeless_horseman's picture

 

 

Typical practices have adapted a far more scrutinized business
environment as margins have decreased. Their business models are build
on reimbursement codes and the processing of such information.

Well, if I didn't just have the CEO of one of the largest EHR vendors telling me exactly the opposite, I might believe you...no, I still would know that you are wrong.

Try my simple test from above.  Are you chicken?

Thu, 10/24/2013 - 15:22 | 4087598 Mark Urbo
Mark Urbo's picture

We deal with it all the time - you're wrong on several accounts...

Thu, 10/24/2013 - 15:55 | 4087681 hedgeless_horseman
hedgeless_horseman's picture

 

 

you're wrong on several accounts...

lol

Like what?

Mark, I know what you do for a living, and the fact is neither you, nor anyone there, really knows much about what I am talking about.

If you would do some real analysis, such as the simple test I suggest above, versus just paying some money for an MGMA report, then you would see what is really going on down in the dirt.

Thu, 10/24/2013 - 16:20 | 4087841 Mark Urbo
Mark Urbo's picture

We are in the trenches with practitioners and we see the numbers - its what we base our investments on...

The fact of the matter is that between rising cost of liability insurance and the increasing cost of system (paperwork) processing, the margins are already suspect - considerably lower than just five (5) yrs ago.  That reality drives each business entity to nano manage the process you think (are saying) they don't have a handle on ?  

That's real HH - not an second or third party analysis.  Sorry, but you're insight in most cases is correct - not here.

Thu, 10/24/2013 - 16:41 | 4087880 hedgeless_horseman
hedgeless_horseman's picture

 

 

We are in the trenches with practitioners and we see the numbers - its what we base our investments on

 

From my post, above...

The average practice size is just under two physicians,
meaning there are many sole practitioners, many of which have either
their their wife or a nurse running the business.

Mark, know how your data set relates to the whole.  You are looking only at a very small number of the large to very large providers, mostly facilities and not physicians. Correct?  That group is not representative of the whole, and probably not even statistically significant, but you probably haven't run a power analysis to know that.

I glean data from The Cleveland Clinic and SCA on down to hundreds of one to five physician practices.

Again, where is my insight incorrect, and how am I wrong?

Thu, 10/24/2013 - 16:41 | 4087914 Mark Urbo
Mark Urbo's picture

In what we do, it results in working with an average entity w/ four docs - two is quite common.

HH, they entering survival mode territory. From our perspective, its become less desirable to invest as ROI weakens. Survival mode is not a good environment for new technology cultivation.  

ACA will increase the cost of system (paperwork) processing (that is the game you are alluding to) beyond what is manageable (i.e., "profitable" and that includes LT accts payable).  The discussion has turned to cash-only, liability wavier type franchises, which is a separate subject.  I discuss these issues with numerous practitioners on a weekly basis as they seek solutions or strategies - how many do you talk too ?

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