What: A Holiday Party! Come join us for merrymaking!
When: Friday, December 12th from 10 AM to 5 PM – Drop by anytime!
Where: AaNA Office – 3701 East Tudor Road, Suite 208 Anchorage, AK 99507
Who: YOU!

RSVP to Andrea Nutty – andrea@aknurse.org or 274-0827.

You don’t get a pass this year on big health insurance decisions because you’re not shopping in an Affordable Care Act marketplace. Employer medical plans — where most working-age folks get coverage — are changing too.

Rising costs, a looming tax on rich benefit packages and the idea that people should buy medical treatment the way they shop for cell phones have increased odds that workplace plans will be very different in 2015.

“If there’s any year employees should pay attention to their annual enrollment material, this is probably the year,” said Brian Marcotte, CEO of the National Business Group on Health, which represents large employers.

In other words, don’t blow off the human resources seminars. Ask these questions.

1. Is my doctor still in the network?Some employers are shifting to plans that look like the HMOs of the 1990s, with limited networks of physicians and hospitals. Provider affiliations change even when companies don’t adopt a “narrow network.”

Insurers publish directories, but the surest way to see if docs or hospitals take your plan is to call and ask.

“People tend to find out the hard way how their health plan works,” said Karen Pollitz, a senior fellow with the Kaiser Family Foundation. “Don’t take for granted that everything will be the same as last year.” (Kaiser Health News is an editorially independent program of the foundation.)

2. Is my employer changing where I get labs and medications?For expensive treatments — for diseases such as cancer or multiple sclerosis — some companies are hiring preferred vendors. Getting infusions or prescriptions outside this network could cost thousands extra, just as with doctors and hospitals.

3. How will my out-of-pocket costs go up?It’s probably not a question of if. Shifting medical expense to workers benefits employers because it means they absorb less of a plan’s overall cost increases. By lowering the value of the insurance, it also shields companies from the “Cadillac tax” on high-end coverage that begins in 2018.

Having consumers pay more is also supposed to nudge them to buy thoughtfully — to consider whether procedures are necessary and to find good prices.

“It gets them more engaged in making decisions,” said Dave Osterndorf, a benefits consultant with Towers Watson.

How well this will control total costs is very unclear.

Your company is probably raising deductibles — the amount you pay for care before your insurance kicks in.  The average deductible for a single worker rose to $1,217 this year, according to the Kaiser Family Foundation. One large employer in three surveyed by Marcotte’s group planned to offer only high-deductible plans (at least $2,600 for families) in 2015.

Employers are also scrapping co-payments — fixed charges collected during an office or pharmacy visit.

Once you might have made a $20 copay for a $100 prescription, with the insurance company picking up the other $80. Now you might pay the full $100, with the cost applied against your deductible, Marcotte said.

4. How do I compare medical prices and quality?Companies concede they can’t push workers to shop around without giving information on prices and quality.

Tools to comparison shop are often primitive. But you should take advantage of whatever resources, usually an online app from the insurance company, are available.

5. Can I use tax-free money for out-of-pocket payments?Workers are familiar with flexible spending accounts (which aren’t that flexible). You contribute pretax dollars and then have to spend them on medical costs before a certain time.

Employers increasingly offer health savings accounts, which have more options. Contribution limits for HSAs are higher. Employers often chip in. There is no deadline to spend the money, and you keep it if you quit the company. So you can let it build up if you stay healthy.

Don’t necessarily think of HSAs as money down the drain, says Osterndorf. Think of them as a different kind of retirement savings plan.

6. How is my prescription plan set up?Drugs are one of the fastest-rising medical costs. To try to control them, employers are splitting pharma benefits into more layers than ever before. Cost-sharing is lowest for drugs listed in formulary’s bottom tiers – usually cheap generics — and highest for specialty drugs and biologics.

If you’re on a long-term prescription, check how it’s covered so you know how much to put in the savings account to pay for it. Also see if a less-expensive drug will deliver the same benefit.

Kaiser Health News (KHN) is a national health policy news service. It is an editorially independent program of the Henry J. Kaiser Family Foundation.

California’s experiment aimed at moving almost 500,000 low-income seniors and disabled people automatically into managed care has been rife with problems in its first six months, leading to widespread confusion, frustration and resistance.

Many beneficiaries have received stacks of paperwork they don’t understand. Some have been mistakenly shifted to the new insurance coverage or are unaware they were enrolled. And 44 percent of those targeted for enrollment through Oct. 1 opted out.

Harold Marshall, who has hypertension, bipolar disorder, chronic pain and bladder cancer, said he rejected the managed care program because one of his doctors said he wouldn’t see him anymore if he was enrolled. Marshall, who lives in Inglewood, gets most of his care at renowned hospitals –Cedars Sinai Medical Center and UCLA.

“If I didn’t have my doctors, I don’t know what would happen,” he said.

In fact, doctors have been among the most vocal critics of the switch, and the state admittedly is having trouble getting some of them to participate.

“The scope and the pace are too large and too rapid for what is supposed to be a demonstration project,” said Dr. William Averill, executive board member of the Los Angeles County Medical Association, which filed a lawsuit to block the project. “We are concerned that [the project] is ill-conceived, ill-designed and will jeopardize the health of many of the state’s most vulnerable population – the poor, the elderly and the disabled.”

There is a lot riding on the pilot — the largest of its kind in the nation. The patients involved are among the most expensive to treat – so-called “dual eligibles,” who receive both Medicare, the health insurance program for the elderly and disabled, and Medicaid, which provides coverage for the poor. Over the three years of the demonstration project, California is focusing on 456,000 of the state’s 1.1 million dual eligibles.

State officials acknowledge some transition problems but say the project will provide consumers with more coordinated care that improves their health, reduces their costs and helps keep them in their homes. In addition, officials estimate the program could save the state more than $300 million in fiscal year 2014-2015.

Breaking Down Silos

Until now, many of these patients have had to maneuver through two massive government bureaucracies, each with separate rules. Medicare pays for most doctor visits and hospitalizations, and Medicaid covers nursing and other long-term care.

The patients are more vulnerable than most Medicare beneficiaries, more likely to have Alzheimer’s, diabetes and mental health problems. Many see multiple doctors in different practices, sometimes receiving unnecessary medications or duplicative tests.

nder the project, patients are given a single health plan membership card and a case manager. Instead of paying doctors per visit, the government pays the managed care plan a set monthly rate to manage all of the patient’s needs, including in-home care and nursing home stays.

“This is extremely exciting how we have broken down these silos of these two programs and are really focusing on how we can bring together and better integrate medical, behavioral and long-term care,” said Toby Douglas, director of the California Department of Health Care Services, which is implementing the program. As a result, people will “get care in the right setting at the right time, which is going to improve the experience and quality and outcomes and bend the cost curve.”

In practice, however, challenges abound.

Beneficiaries have been confused by the information packets from the state and the plans– which start arriving in the mail 90 days in advance. For instance, notices say people have “new choices” about coverage that will improve their care. But if patients or their authorized representatives don’t call or send in a form opting out, they are enrolled anyway.

Little publicity preceded the shift.

“The state has not done a good job marketing the program,” said Aileen Harper, executive director of the Center for Health Care Rights, a nonprofit contracted by the state to answer beneficiaries’ questions and guide them through the process. “That is one of the reasons you have seen the pushback.”

In most — but not all– counties, patients have a choice of plans. The pilot program’s enrollment is occurring on a rolling basis and now includes five counties – San Mateo, Los Angeles, San Bernardino, San Diego and Riverside. The program will begin in Santa Clara in January and Orange County this summer but will not move forward in Alameda County as originally planned.

“This is extremely exciting how we have broken down these silos of these two programs and are really focusing on how we can bring together and better integrate medical, behavioral and long-term care,” said Toby Douglas, director of the California Department of Health Care Services, which is implementing the program. As a result, people will “get care in the right setting at the right time, which is going to improve the experience and quality and outcomes and bend the cost curve.”

In practice, however, challenges abound.

Beneficiaries have been confused by the information packets from the state and the plans– which start arriving in the mail 90 days in advance. For instance, notices say people have “new choices” about coverage that will improve their care. But if patients or their authorized representatives don’t call or send in a form opting out, they are enrolled anyway.

Little publicity preceded the shift.

“The state has not done a good job marketing the program,” said Aileen Harper, executive director of the Center for Health Care Rights, a nonprofit contracted by the state to answer beneficiaries’ questions and guide them through the process. “That is one of the reasons you have seen the pushback.”

Among more than 195,000 eligible beneficiaries as of Oct. 1, about 86,000 had opted out. State numbers released Saturday show the opt-out rate had declined to 33% as of Nov. 1. The drop is because Santa Clara residents have just begun to receive notices and only a small number have decided not to participate.

‘Taking Things Away’

Some of the rules are surprising or mystifying to beneficiaries.

Tujunga resident Joyce Lest, 62, said she received a letter saying she now has to pay for part of her prescriptions but won’t receive an extra allocation for over-the-counter medications as she did before.

“I signed up thinking they were going to help me,” said Lest, who has high blood pressure and advanced osteoarthritis. Instead, “they are taking things away from me.”

Michael Williams, a 59-year-old with cerebral palsy, said he has received several packets of information at his Altadena home, each more confusing than the last. The booklets didn’t make clear how his care would change or whether he could keep his pharmacist, physical therapist and the person who builds his leg braces, he said.

So Williams opted out, fearing he’d have to travel farther for medical care. “I’m not physically up to that,” he said. “I’m scared this is just going to turn into a big mess.”

Under the rules, people can ask for permission to continue to see their established providers for six months, then must switch to those in the managed care network. No concrete numbers are available on how many doctors are participating, although plans are required to demonstrate that they have sufficient networks of doctors.

The state has been besieged with questions. In September alone, there were nearly 50,000 calls to the state’s health care services department about the project.

Greg Knoll, executive director of the Legal Aid Society of San Diego that runs the state ombudsman office said: “The phones were ringing off the hook … The rollout has been rocky.”

The biggest issue, Knoll said, is the “disruption of care” – beneficiaries saying they have to reschedule appointments and surgeries because of the changes.

Douglas said the state is trying to address the problems quickly. Among other things, officials are expanding outreach and education, relying on a website www.calduals.org, virtual and telephonic town halls, a call center and partnerships with community groups.

Douglas said he thinks patients will be less likely to opt out when they learn more about the project and see others receiving better care.

Trying To Make It Work

Douglas said the resistance of some doctors is not surprising. Some fear their rates will be lower and others have had long experience being paid each time they treat a patient. The state is trying to get more information out to encourage greater participation, he said.

Patrick Johnston, chief executive officer of the California Association of Health Plans, said that while it is of concern that some physicians are not interested, health plans have still been able to build comprehensive networks of primary and specialty care providers for the tens of thousands of people already in the program, and they are continuing to expand those networks.

“The state decided to go big from the outset .. and now our job is to help make it work,” he said.

Inland Empire Health Plan, which covers the patients in Riverside and San Bernardino counties, has been working both to expand its network and contact providers so they won’t drop their patients, said CEO Bradley P. Gilbert. Gilbert said teams of physicians, pharmacists and behavioral health specialists working together can deliver better care. But, he said, “There are still a lot of doctors and members who aren’t sure what is really going on.”

The California project stems from the Affordable Care Act, which does not mandate managed care but promotes better integration of the Medicare and Medicaid programs. Managed care is nothing new to California, which already has extensive experience in both the public and private sectors – including in its regular Medi-Cal program.

Despite the early problems, Knoll of San Diego’s legal aid office said he is hopeful that the project will eventually result in better care for elderly and disabled people. “This is a very vulnerable population,” he said. “I believe this is the right thing to do.”

Kaiser Health News (KHN) is a national health policy news service. It is an editorially independent program of the Henry J. Kaiser Family Foundation.

Secretary Burwell announces Region IX Director of HHS

Jay Radcliffe breaks into medical devices for a living, testing for vulnerabilities as a security researcher.

He’s also a diabetic, and gives himself insulin injections instead of relying on an automated insulin pump, which he says could be hacked.

“I’d rather stab myself six times a day with a needle and syringe,” Radcliffe recently told security experts meeting near Washington, D.C. “At this point, those devices are not up to standard.”

Concern about the vulnerability of medical devices like insulin pumps, defibrillators, fetal monitors and scanners is growing as health care facilities increasingly rely on devices that connect with each other, with hospital medical record systems and —directly or not — with the Internet.

Radcliffe made headlines in 2011 by showing a hackers’ convention how he could exploit a vulnerability in his insulin pump that might enable an attacker to manipulate the amount of insulin pumped to produce a potentially fatal reaction. Now he talks about going without a pump to raise awareness about the potential for security lapses and the need for better engineering.

While there have been no confirmed reports of cyber criminals  gaining access to a medical device and harming patients, the Department of Homeland Security is investigating potential vulnerabilities in about two dozen devices, according to a Reuters report. Hollywood has already spun worst-case scenarios, including a 2012 episode in the Homeland series portraying a plot to kill the vice president by manipulating his pacemaker.

“The good news is, we haven’t seen actual active threats or deliberate attempts against medical devices yet,” said Kevin Fu, a University of Michigan researcher who has made his career testing the vulnerability of medical systems.

The bad news is that hospital medical devices may be vulnerable to hackers simply because they can be the weak link that gives a criminal access to a hospital’s data system — especially if the devices haven’t been updated with the latest security patches, said Ken Hoyme, a scientist at Adventium Labs, a cybersecurity firm in Minneapolis.

In the real world, he said, a hacker is more likely interested in stealing records he can sell than in harming a patient.

“There are not that many bad…guys whose goal in life is to go and randomly mess with patients in hospitals,” Hoyme said. “They want money, not to shut off the ventilator of a particular patient.”

Hospitals are targets because they collect so much data, from patients’ Social Security numbers and financial information, to diagnosis codes and health insurance policy numbers.

Radcliffe estimates that medical identity information is worth 10 times more than credit card information —about $5 to $10 per record on the black market compared to 50 cents per account for credit card information.

Crooks can use it to apply for credit, file fake claims with insurers or buy drugs and medical equipment that can be resold.

And unlike the victims of credit card theft, those with stolen medical identities might not know for months or even years, giving the thieves more time to use their information.

New FDA Guidelines

Yet there are few cybersecurity standards for medical devices.

In October, the FDA issued guidance outlining what security features developers should bake into their products when seeking approval for a new device.

The guidelines, which aren’t binding, say that when seeking approval for a new device, manufacturers should detail cybersecurity threats they considered and create better ways to detect when it might have been hacked.

They should also build in protections, such as limiting access to authorized users and restricting software updates only to products with authenticated coding.

While a good start, some security experts say the guidelines should be binding. Others fear that giving them the force of regulation could be more harmful because they would become outdated quickly.

Nonetheless, the FDA’s guidance has, in effect, changed the conversation among device makers from, “‘Do I believe this is a real threat?’ to ‘What do I have to do to satisfy the FDA?’” said Hoyme.

By the end of the year, the agency is expected to issue similar recommendations for devices already on the market.

Common Vulnerabilities

One reason many existing devices might be vulnerable is they run on defunct operating systems like Windows XP, which Microsoft stopped supporting in April, meaning there won’t be any new security patches. Other, newer devices may have built-in passwords that are difficult to update. Gaining access to them can be fairly easy which could make them more vulnerable to attack, researchers say. In addition, sometimes, a password is intentionally disabled so it’s easily accessible to medical staff in an emergency.

Hackers can also get into some inadequately protected hospital systems when staff members click on links in emails, not knowing they contain malicious code. Once transmitted to a hospital’s intranet, that malware could find its way into unprotected device software and cause malfunctions, said Hoyme and Fu.

“If cyber criminals decide they can hack into a device to get health records, they won’t think about whether they’re messing with device performance: They’re going after the money,” Hoyme said.

Security experts warn that some of the same design flaws that make medical devices vulnerable would also make breaches hard to track.

“If your iPhone is compromised, it’s a lot more straightforward for someone to determine if it’s been tampered with. We’re not there yet” with medical devices, said Billy Rios, a former Google software engineer turned security consultant.

He describes how he was able to buy a secondhand EKG machine, used to measure the heart’s electrical activity, for just $25 online. Some infusion pumps and patient monitoring systems go for less than $100. That makes devices more readily available to those who want to figure out vulnerabilities to exploit.

“The effort required is so much lower,” he says. “That’s not a good position to be in.”

What Hospitals Are Doing

Hospitals are loathe to talk about device security publicly, but many are working to ensure their systems are stronger.

In a two-year test of information security, experts working for Essentia, a large Midwestern health system, found that many devices were hackable. For instance, they found settings on drug infusion pumps could be altered remotely to give patients incorrect doses, defibrillators could be manipulated to deliver random shocks and that medical records could be changed.

Stephen Curran, acting director of the Division of Resilience and Infrastructure Coordination with the Department of Health and Human Services, could not say how many facilities have a chief security officer or someone in charge of cybersecurity.  But even small facilities have some relatively simple options for boosting the security of devices on their networks, he said, including “routine backups and patching of the systems and the use of anti-virus firewalls.”

Still, while “we definitely see a trend in hospitals to improve their security,” says Mike Ahmadi, global director of critical systems security at cybersecurity firm Codenomicon, vendors have to do more to engineer security.

“The bigger issue is that vendors are not held accountable for writing insecure code,” says researcher Rios. “There’s no incentive…so they don’t invest.”

Pressure On Vendors

A few hospitals, including the Mayo Clinic, have started to write security requirements into their procurement contracts.

At the University of Texas MD Anderson Cancer Center in Houston, any new software application has to be approved by the hospital’s security team, headed by Lessley Stoltenberg, chief information security officer.

He says device makers also will have to meet a slew of security requirements: Can the device be encrypted?  Is there a unique identification for users? If the vendor is hosting the device, what does their system look like in terms of firewalls and other protections? Will the manufacturer provide up-to-date security patches?

Some companies, like Ahmadi’s Codenomicon, specialize in selling software to detect software bugs that could lead to security holes.

While Codenomicon has a number of device makers as customers, those are a fraction of the more than 6,500 medical device manufacturers in the U.S., some of which may not be doing even the most basic testing. Most vendors are small — 80 percent have fewer than 50 employees — and many are startups without the capital to invest in a security expert.

So, could hackers target infusion pumps or ventilators?

“Is it possible?” Stoltenberg mused. “Yes. Is it likely? No.  No device in the world is absolutely 100 percent secure.”

Kaiser Health News (KHN) is a national health policy news service. It is an editorially independent program of the Henry J. Kaiser Family Foundation.

Earlier this month, Arizona voters approved a referendum that allows terminally ill patients to receive experimental drugs and devices. It’s the fifth state to approve a “right-to-try” law this year.

Supporters say the laws give dying patients faster access to potentially life-saving therapies than the Food and Drug Administration’s existing “expanded-access” program, often referred to as “compassionate use.” But critics charge they’re feel-good laws that don’t address some of the real reasons patients may not receive experimental treatments.

The legislatures in Colorado, Louisiana, Michigan and Missouri also passed right-to-try laws this year as part of a nationwide effort spearheaded by the conservative Goldwater Institute, which hopes to get right-to-try laws on the books in all 50 states. The measures generally permit a patient to get access to an experimental drug after it’s passed through phase 1 of a clinical trial, the initial testing in which a drug is given to a small group of people to evaluate its safety and side effects.

“For people with terminal illness, for whom nothing else has proved effective, they don’t have the luxury of waiting four to five months to get through the FDA’s compassionate-use program,” says Victor Riches, vice president of external affairs at the Goldwater Institute. Riches says that timeframe includes a lengthy application by the patient’s physician, FDA review and approval of the request and a federally required review by an institutional review board, a group of medical experts that evaluates the risks and ensures the patient understands them as well.

Between 2009 and 2013, the FDA received roughly 1,000 expanded-access applications annually and approved virtually all of them. Among other things, the FDA considers the severity of the patient’s condition and whether other avenues of treatment have been exhausted. Some patient advocates and policy experts say that while the FDA process could be sped up, they support the agency’s continued oversight because of its critical role in ensuring drug safety and effectiveness.

But even if the FDA approves a request for an experimental drug, the patient might not get it. Drug companies are not obligated to provide the drug to patients who request it.

Right-to-try laws are no different.

“We take a free market approach to problem solving, and we would never mandate that the drug companies provide these medications,” says Riches.

Without any assurance of access to an experimental drug or device, and with no financial support to help patients cover the costs, right-to-try laws give patients false hope, say critics of the laws.

“There’s no money in these laws, and no provision for companies to supply anything,” says Arthur Caplan, director of the division of medical ethics at New York University’s Langone Medical Center’s Department of Population Health. Caplan has been a vocal critic of right-to-try laws.

In addition to the cost of the drug, if the drug company doesn’t cover it, patient advocates say expenses can be a significant burden on people who have to travel to get access to an experimental drug.

“It’s a big issue for patients with rare diseases,” says Diane Dorman, vice president of public policy at the National Organization for Rare Disorders. NORD has historically been supportive of the FDA expanded-access program. It doesn’t take a position on right-to-try laws.

The degree to which insurers cover drugs and medical services under FDA’s expanded-access program varies, say health policy experts. According to the FDA website, some companies charge patients for the experimental drug, and medical services may or may not be covered.

The right-to-try model legislation developed by the Goldwater Institute explicitly states that insurers are not required to cover the costs of either the drug or device, or other services related to its use.

In addition to questioning whether right-to-try laws will make any meaningful difference in ill patients lives—Riches says he’s unaware of any patients who have taken advantage of the laws to date—critics voice a broader concern about the potential impact on the drug development process.

The decision by drug companies whether to provide a drug to one very sick individual is wrenching. How do they balance the needs of that person against the potential to introduce the drug to a broader patient population? Terminally ill individuals who receive experimental drugs may well suffer serious adverse events, potentially setting back the drug approval process.

“The concern is that these laws don’t really address the risks to the companies,” says Brenda Huneycutt, a director of regulatory strategy and FDA policy at Avalere Health, a research and consulting firm.

In addition, if more people get access to drugs through right-to-try laws, they may be less likely to participate in the clinical trials that are essential to new drug development, say experts. Why risk being given a placebo when patients can be assured of getting the drug under a right-to-try law?

“For us, the most important thing is that the clinical trial process remains robust so products can be approved most quickly,” says Dorman.

Please contact Kaiser Health News to send comments or ideas for future topics for the Insuring Your Health column.

Kaiser Health News (KHN) is a national health policy news service. It is an editorially independent program of the Henry J. Kaiser Family Foundation.