In the late 1990s you could have taken what hospitals charged to administer inpatient chemotherapy and bought a Ford Escort econobox. Today average chemo charges (not even counting the price of the anti-cancer drugs) are enough to pay for a Lexus GX sport-utility vehicle, government data show.

Hospital prices have risen nearly three times as much as overall inflation since Ronald Reagan was president. Health payers have tried HMOs, accountable care organizations and other innovations to control them, with little effect.

A small benefits consulting firm called ELAP Services is causing commotion by suggesting an alternative: Refuse to pay. When hospitals send invoices with charges that seem to bear no relationship to their costs, the Pennsylvania firm tells its clients (generally medium-sized employers) just say no.

Instead, employers pay hospitals a much lower amount for their services — based on ELAP’s analysis of what is reasonable after analyzing the hospitals’ own financial filings.

For facilities on the receiving end of ELAP’s unusual strategy, this is a disruption of business as usual, to say the least. Hospitals are unhappy but have failed to make headway against it in court.

“It was a leap of faith,” when Huffines Auto Dealerships, which provides coverage to 300 employees and their families, signed on to the ELAP plan a few years ago, said Eric Hartter, chief financial officer for the Texas firm.

What he says now: “This is the best form of true health care reform that I’ve come across.”

Huffines first worked with ELAP on charges for an employee’s back surgery. The worker had spent three days in a Dallas hospital.  The bill was $600,000, Hartter said.

Like many businesses, the dealership pays worker health costs directly. At the time it was working with a claims administrator that set up a traditional, “preferred provider” network with agreed hospital discounts.

The administrator looked at the bill and said, “‘Don’t worry. By the time we apply the discounts and everything else it’ll be down to about $300,000,’” Hartter recalled. “I said, ‘What’s the difference? That doesn’t make me feel any better.’”

Instead he had ELAP analyze the bill. The firm estimated costs for the treatment based on the hospital’s financial reports filed with Medicare. Then it added a cushion so the hospital could make a modest profit.

“We wrote a check to the hospital for $28,900 and we never heard from them again,” Hartter said.

Now Huffines and ELAP, which launched this service in 2007 and has been growing since, treat every big hospital bill the same way. The result has saved so much money that what the dealership and workers contribute for health costs stayed unchanged for six years while benefits remained the same, Hartter said.

More than 200 employers providing health coverage to about 115,000 workers and dependents have hired ELAP. Company CEO Steve Kelly said he is aware of only one other, smaller, benefits consultant with the same approach.

Normally customers who don’t pay bills get hassled or sued. This sometimes happens to ELAP clients and their workers. Hospitals send patients huge invoices for what the employer refused to pay. They hire collection agents and threaten credit scores.

ELAP fights back with lawyers and several arguments: How can hospitals justifiably charge employers and their workers so much more than they accept from Medicare, the government program for seniors? How can hospitals bill $30 for a gauze pad? How can employee-patients consent to prices they will never see until after they’ve been discharged?

The American Hospital Association and the Federation of American Hospitals did not respond to requests for comment about ELAP.

ELAP is not merely a medical-bill auditor, like many other companies, combing hospital statements for errors. It sets the reimbursement, telling hospitals what clients will pay.

Eventually, “overwhelmingly, the providers just accept the payment” and leave patients alone, Kelly said. A federal district judge in Georgia decided a 2012 case against a hospital and in favor of ELAP and its furniture chain client.

Most patients being dunned by hospitals are unlikely to meet with the same success on their own, lacking backup from ELAP and its legal firepower.

Under ELAP’s main model, neither employers nor their claims administrators sign contracts with hospitals. Employers detail the reimbursement process in documents establishing how the plan covers workers. That gives it legal weight, ELAP has argued in court. ELAP agrees to handle all hospital bills for an employer and defend workers from collections in return for a percentage fee tied to total hospital charges.

There is no hospital network. Employees may use almost any facility. Payments are made later based on ELAP’s analysis.

That may change, Kelly said. Often it makes sense even for medium-sized employers to contract directly with hospitals to treat their workers, he said. That way prices are clear.

But for now ELAP clients such as Huffines and IBT Industrial Solutions are giving hospitals a different dose of medicine.

At IBT, a Kansas distributor of bearings and motors, “runaway health costs were starting to threaten the long-term viability of our company,” said chief financial officer Greg Drown. After reading “Bitter Pill,” a critical Time magazine piece about hospitals, IBT executives decided to try something else.

They hired ELAP, which was “not a simple or risk-free move,” cautions Drown.

About one IBT worker in five using a hospital gets “balance billed” for amounts the employer won’t pay, he said. That can take months to resolve even with ELAP’s legal support. But ELAP’s program cut health costs by about a fourth, he added.

Recently managers at a big medical system in metro Kansas City “finally figured out we were doing something a little bit different,” sent “a nasty letter” and followed up with a call, he said.

The hospital executive on the phone “was very condescending and thought I was stupid and had been duped by a predatory consultant and had been sold a — quote — crappy plan,” Drown said.

Drown listened. He told the man he would consult with his colleagues and reply.

“I called him back a week or two later and left him a rather detailed voicemail that said, ‘We’re not changing anything. We’re staying where we are.’ And the guy never called me back.”

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

Doctors called it the black hole.

If their low-income or uninsured patients needed specialty care, they put in a referral to the massive Los Angeles County health care bureaucracy and then waited — for weeks or even months. It could take eight months to see a neurologist, more than three to see a cardiologist.

To speed things up, doctors at county and community clinics urged their patients to go straight to the emergency room, the unofficial back door for specialist appointments. That way, patients could bypass the long waits and get the recommended colonoscopy or CT scan. But that route was expensive and burdensome to ERs.

It’s a problem across the nation: Specialists are hard to find for many patients, and even harder to afford. Sick people may grow sicker as they wait for appointments, causing them unnecessary discomfort and making treatment more costly in the long run. Diabetics may suffer with untreated foot ulcers, raising the risk of amputation; patients with abnormal chest X-rays may turn out to have cancer.

With a million patients a year depending on Los Angeles County for health care, local officials decided they had to act. Hiring scores of costly specialists wasn’t an option. So in 2012 they created a program called eConsult, modeled after a system at San Francisco General Hospital, to streamline the referral process.

The L.A. County program allows for a Web-based conversation between primary care doctors and specialists that can include the exchange of medical records and photographs. The specialist typically responds to inquiries within three days and a decision on a referral soon follows.

Much as a triage nurse clears the way for accident victims in a crowded ER, clinics would use guidelines for each specialty — created by specialists and primary care doctors working together — to determine who needs an appointment and how quickly. The primary care physicians can continue to care for the remaining patients, consulting with specialists electronically.

Three years later, it’s clear the program hasn’t been a panacea. Most patients in Los Angeles County still need face-to-face appointments with specialists, and there still aren’t enough of them to go around. But both primary care doctors and specialists say things have gotten better.

The county quickly realized its hypothesis was right — about 30 percent of patients referred by providers at county and community clinics didn’t actually need to see a specialist in person. Primary care doctors said they now have a clear way to communicate with specialists about their patients. And when patients do get to the specialist’s office, more have the necessary lab work or tests so the appointments are more efficient.

Overall, doctors agree that the electronic referral system has improved both communication and collaboration among doctors on both sides. And primary care doctors say the new system is far better than the old days, when they would have to “beg, borrow and plead” to get appointments for their patients.

Wait times for specialists in general also have dropped, although a small number of patients with nonurgent health issues still may have to wait up to six months for appointments, according to the county’s specialty care director, Dr. Paul Giboney.

COSTS COULD GO UP

In L.A. County, about 10,000 eConsult requests come in each month across more than 40 specialties. The program has the potential to become a national model: Giboney said health leaders in Illinois, Alaska, Connecticut and elsewhere have contacted him to ask about how the county’s program works.

But some primary care doctors have argued that they don’t have the skills, time or resources to manage patients who need more advanced care. In addition, the system isn’t set up to pay community physicians for the added work, tests or procedures that specialists request before seeing patients.

“Without any extra reimbursement, those costs are hitting the primary care providers,” said Dr. Richard Seidman, chief medical officer at Northeast Valley Health Corp., which runs several community clinics.

EConsult works better for some specialties than others. For example, an endocrinologist may be able to advise a doctor on how to manage the complications of diabetes or a cardiologist can suggest ways to manage a heart murmur but an ophthalmologist can’t treat cataracts through an electronic conversation. Nearly 90 percent of patients referred to ophthalmology end up with an in-person appointment.

Nevertheless, Dr. Lauren Daskivich, an ophthalmologist with L.A. County, said she no longer has to try to interpret one-line referrals and can more easily figure out what type of eye doctor a patient needs to see and how soon. “For the first time, we have actually been able to triage how urgently they need to get in,” she said.

Nationwide, the problem of access to specialists has eased somewhat due to the Affordable Care Act, which enabled more than 16 million people to get insurance. But the health law didn’t cover everyone, most notably people living here illegally, and specialists may not take the insurance that patients have.

Electronic consultation by itself can’t resolve the access problem for poor patients, said Dr. Nwando Olayiwola, associate director of UC San Francisco’s Center for Excellence in Primary Care, who studies these efforts nationally. “It solves a huge part of the problem but it doesn’t solve all of it,” she said.

For now, the Los Angeles County health care system is still overburdened. One doctor put it simply: Technology doesn’t solve the problems that were there before technology.

At the UMMA Community Clinic in South Los Angeles, more than 40 percent of patients remain uninsured and some have been in the queue for a specialist appointment for months. The clinic’s Dr. Cesar Barba says he’s grateful there is a way to talk to specialists and identify those who need to be seen more quickly.

The eConsult system helps, but it “is not the ideal,” Barba said. “The best solution is if we had more specialists. That would be ideal.”

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

Five years after the Affordable Care Act passed, its Medicaid expansion provision is still causing huge fights in state legislatures.

Twenty-four states and the District of Columbia said yes to Medicaid expansion when the law went into effect. Since then, just six more have signed on. States that do get billions of additional federal dollars, but many Republican lawmakers are loathe to say yes to the Obama administration.

The fight’s garnered many headlines in Florida recently as the Republican-led House and Senate are at odds on expansion and the legislative work—including setting a budget—came to a standstill. But the issue has also been hot out west this year where four Republican majority states took up Medicaid expansion. Wyoming said no, Utah’s governor is seeking to negotiate a compromise with Washington to offer legislators, and Alaska legislators are still wrestling with the issue. And after some legislative fireworks, Montana said yes.

Montana lawmakers have been stewing over Medicaid expansion since they said no to it in 2013 – the last time they met. When they reconvened in January, Americans for Prosperity, a conservative group supported by the billionaire brothers Charles and David Koch, staffed up in the state and targeted moderate Republicans, organizing anti-expansion “town hall” meetings in their districts.

But AFP didn’t invite targeted lawmakers themselves and that backfired. Many voters called AFP’s tactics meddling by outsiders, and some AFP meetings were disrupted.

Tea Party lawmakers in the Montana House fought hard against Medicaid expansion. They killed a proposal by Democrats, and then nearly derailed a Republican-sponsored compromise. The House had to bend its rules to even bring the bill to the floor for a vote. But in the end, 20 Republicans felt politically safe enough to cross party lines and vote with all the Democrats to pass it.

Still, at the bill’s signing ceremony Republican Senator Ed Buttrey, who sponsored the bill, said, “This not Medicaid expansion.”

Buttrey says Republicans won important concessions from Democrats to make Montana’s bill more palatable to conservatives. People will have to pay small premiums and the bill also sets up job training and education programs. Buttrey insisted that Montana isn’t just doing the bidding of the White House.

“I’ll say it again, and I hope the media will report this exciting and unique story,” he said.  “This is not Medicaid expansion.”

Montana’s proposal is now on its way to federal officials, who will have the last word on whether it’s legitimate under the Affordable Care Act.

In Alaska, Governor Bill Walker, a former Republican who is independent, has made Medicaid expansion one of his top priorities.

But Republicans leading the state House and Senate blocked expansion during the legislative session that just wrapped up.

One of those opposed is Senator Pete Kelly.

“I think everyone agrees that Medicaid is broken,” he says.  “To put more money into it, to bring more people into it, that’s certainly not going to help its brokenness.”

But surveys show 65 percent of Alaskans favor Medicaid expansion. Supporters testified in large numbers at legislative committee hearings and attended rallies. In one, organized by an interfaith church group, Lutheran pastor Julia Seymour turned the crowd into a choir. She led them in singing, “Medicaid expansion, I’m going to let it shine” to the tune of “This Little Light Of Mine.”

Seymour’s determined to make sure all Alaskans have access to health insurance.

“The Bible tells us that faith, hope and love go on and do not end. And I’m keeping the faith and I am hopeful, but my love for some of the leaders is waning now and then,” she says.

As soon as the regular session ended,  Gov. Walker called lawmakers into special session.

The state is currently facing a massive budget deficit because of the plunge in oil prices. And Walker says even in better financial times, Alaska doesn’t usually decline more than a billion federal dollars.

“If that was a road project or if that was some infrastructure project, we would be all over that,” he says.  “This is healthcare.”

Walker has proposed expanding on his own if lawmakers don’t act but it’s not clear he has this authority. About 40,000 people would qualify for Medicaid if the state expands. About 30 percent of this group are Alaska Natives.

This story is part of a partnership with NPR, Montana Public Radio, Alaska Public Media and Kaiser Health News.

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

Symphonie Dawson was 23 and studying to be a paralegal while working part-time for a temporary staffing agency when she learned that the reason she kept feeling sick was because she was pregnant.

Living with her mom and two siblings near Dallas, Dawson worried about what to expect during pregnancy and what giving birth would be like, not to mention how to juggle having a baby with being in school.

At a prenatal doctor visit she learned about a group that offers help for first-time mothers-to-be called the Nurse-Family Partnership. A registered nurse named Ashley Bradley began to visit Dawson at home every week to talk with her about her hopes and fears about pregnancy and parenthood.

Bradley helped Dawson sign up for the Women, Infants and Children Program, which provides nutritional assistance to low-income pregnant women and children. They talked about what to expect every month during pregnancy and watched videos about giving birth. After her son, Andrew, was born in December 2013, Bradley helped Dawson figure out how to manage her time so she wouldn’t fall behind IN at school.

Dawson graduated with a bachelor’s degree in early May. She’s looking forward to spending time with Andrew and looking for a paralegal job. She and Andrew’s father recently became engaged.

Meanwhile, Bradley will keep visiting Dawson until Andrew turns two.

“Ashley’s always been such a great help,” Dawson says. “Whenever I have a question like what he should be doing at this age, she has the answers.”

Home visiting programs that help low-income, first-time mothers have a healthy pregnancy and develop parenting and other skills to get and stay self-sufficient have been around for decades. Lately, however, they’re attracting new fans. Home visiting programs appeal to people of all political stripes because the good ones manage to help families improve their lives and reduce government spending at the same time.

In 2010, the health law created the Maternal, Infant and Early Childhood Home Visiting (MIECHV) program and provided $1.5 billion in funding for evidence-based home visiting programs. There are now 17 home visiting models approved by the Department of Health and Human Services, and Congress reauthorized the program in April with $800 million in funds for the next two years.

The Nurse-Family Partnership is one of the largest and best-studied programs. Decades of research into how families fare after participating in it have documented reductions in the use of social programs such as Medicaid and food stamps, reductions in child abuse and neglect, better pregnancy outcomes for mothers and better language development and academic performance by their children, among other things.

“Seeing follow-up studies 15 years out with enduring outcomes, that’s what really gave policymakers comfort,” says Karen Howard, vice president for early childhood policy at First Focus, an advocacy group.

But some experts, while supporting the MIECHV program overall, say that only a handful of the approved models have as strong a track record as that of the Nurse-Family Partnership. They say the standards for what constitutes an evidence-based program are too lenient.

“If the evidence requirement stays as it is, almost any program will be able to qualify,” says Jon Baron, vice president for of evidence-based policy at the Laura and John Arnold Foundation, which supports initiatives that encourage policymakers to make decisions based on data and other reliable evidence. “It threatens to derail the program.”

Nurse-Family Partnership founder David Olds, professor of pediatrics at the University Of Colorado Denver, began testing the model in randomized controlled clinical trials starting in 1977 and continues to conduct long-term follow-up research today.

A study by the Pacific Institute for Research and Evaluation found that the Nurse-Family Partnership reduced Medicaid spending on a first child by 8 percent, resulting in a savings to Medicaid of $12,308 per family served. When adding in cost reductions in food stamps, special education, Child Protective Services and criminal justice costs, total government savings are closer to $19,000 per family, the study found.

However, many of the models approved by HHS do not have a lengthy track record nor strong evidence of having made meaningful changes in mothers’ or their children’s lives, according to Baron.

Although MIECHV programs must show statistically significant effects in order to qualify as evidence-based, those effects need not have any policy or practical importance to qualify, Baron says.

He offered the example of one program that increased the percentage of mothers who brought their babies to the doctor for a one-month checkup, a process measure. But a few years later, further evaluation found no statistically significant effect on child health or safety, no measurable improvement in concrete outcomes.

“We think this is an important program,” Baron says. “I testified for its reauthorization. We just think that as it goes forward the loophole needs to be adjusted.”

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.

The politics of the Affordable Care Act in the state of Louisiana are not subtle: It is not popular. The state was part of the lawsuit to strike down the law in 2012; it didn’t expand Medicaid and has no plans to, even as other Republican-led states have done so. And Louisiana didn’t set up its own marketplace to sell Obamacare insurance.

Nevertheless, about 186,000 people in Louisiana signed up for health insurance under the law and almost all of them got help from the federal government to pay their premiums.

The U.S. Supreme Court could soon rule illegal the insurance subsidies in Louisiana and more than 30 other states that use the federal website healthcare.gov. If the subsidies are eliminated, the number of uninsured people in the affected states would rise by 8.2 million in 2016, according to recent Senate testimony by Linda Blumberg, a senior fellow at the Urban Institute.

Jeff Cohen from member station WNPR spent three days driving around his home state of Louisiana speaking with people who got insurance under the law. Here are the stories of three people who say their financial independence is riding on the latest health law case before the Supreme Court.

Sheron Bazille

Sitting at her kitchen table in the Baton Rouge home she owns by herself, Sheron Bazille says she had a good job that offered benefits — like health insurance. But she got sick and had to stop working: “It was either me or my job. And my life and my health was more important.”

Bazille, 62, retired early, and she says leaving that job of 10 years meant losing her insurance – and some of her dignity, too.  Now, under Obamacare, she’s got subsidized insurance. She knows exactly how much her share is: “My monthly is 219. And one cent.”

The coverage has given her a sense of security, because she can take care of her health and her health care bills.

“Peace. I have peace now that I know I have hospitalization [coverage],” says Bazille. “If anything happens, I can go to the hospital.”

She worries the Supreme Court justices could take away that peace and asked what she would tell the justices if she could, she says: “Think about your kids, your family. If they could not afford to pay for health insurance. Wouldn’t you want someone to help them?”

Jimmy See

At a coffee shop in Zachary, half an hour north of Bazille’s home in Baton Rouge, Jimmy See says he never felt like he needed health insurance – until he did. He’s 54, a self-employed housing and maintenance worker, and he’d always felt like health insurance was too expensive. But then he started having trouble breathing and he went to the hospital: “They said, ‘Well do you have any insurance? And I said, ‘No.’”

Rather than pay a lump sum up front, he went home and got worse.  Eventually, he collapsed and had to be hospitalized for close to two weeks for pneumonia. His remembers his bill being between $8,000 and $9,000. See negotiated with the hospital and received financial assistance to settle the bill.

“If I hadn’t gotten that, I’d be looking for bill collectors after me,” See says. “And bill collectors don’t play. They come after you.”

See’s Obamacare subsidy covers all of his premium, and he says having insurance is a relief.

“If I had a big operation or whatever, you can’t afford no $70,000, $80,000, $90,000,” he says. “So, through the Affordable Care Act, the government’s going to help you out with all that.”

If the Supreme Court rules against subsidies, See says, for him it would be, “Back to square one. No insurance.”

James Marks

James Marks lives four hours north of Baton Rouge in Shreveport. He doesn’t want to go back to square one, either.

Marks is 36 and works as a freelance computer technician and an afterschool art teacher. Neither job provides insurance and being uninsured has been a blow to his self-esteem.

“It made me feel lousy,” Marks says. “It made me feel like I was sponging off my parents. It made me feel like I wasn’t able to take care of myself.”

Marks lives with a mental health issue – and, for the better part of 10 years, his parents paid for both his psychiatrist and his expensive medications. Now, he pays about $180 a month for a subsidized insurance policy, and he says it makes him feel like an adult.

Asked what he would tell the justices, Marks says: “I know the Supreme Court tries to decide stuff based on the law and not based on the impact that it has on America.  But it’ll wind up making a lot of people who were insured, who had insurance, who were able to go to the doctor and pay for their pills, not be able to anymore. And that’s just pretty lousy.”

This story is part of a reporting partnership that includes WNPR, NPR and Kaiser Health News.

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

Free means free.

The Obama administration said Monday that health plans must offer for free at least one of every type of prescription birth control — clarifying regulations that left some insurers misinterpreting the Affordable Care Act’s contraceptive mandate.

“Today’s guidance seeks to eliminate any ambiguity,” the Health and Human Services Department said. “Insurers must cover without cost-sharing at least one form of contraception in each of the methods that the Food and Drug Administration has identified … including the ring, the patch and intrauterine devices.

The ruling comes after reports by the Kaiser Family Foundation and the National Women’s Law Center, an advocacy group, found many insurers were not providing no-cost birth control for all prescription methods. (KHN is an editorially independent project of the Kaiser Family Foundation.)

Gretchen Borchelt, a vice president with the women’s law center, applauded the guidance.

“Insurance companies have been breaking the law and, today, the Obama Administration underscored that it will not tolerate these violations,” she said. “It is now absolutely clear that ‘all’ means ‘all’— ‘all’ unique birth control methods for women must be covered.”

The law requires that preventive services, such as contraception and well-woman visits, be covered without out-of-pocket expenses, such as a co-pay or deductible.

While HHS said insurers must offer for free at least one version of all 18 FDA approved contraceptives, the plans may still charge fees to encourage individuals to use a particular brand or generic. For example, a generic form might be free, while a brand name version of the drug can include cost sharing, HHS said.

The administration Monday said insurers could have misinterpreted prior rules to mean they only had to offer certain types of contraception without cost-sharing. Plans have until July to implement the policy, which will generally not take effect until a new plan year begins. That means for most people the new rule will start in January.

Cecile Richards, president of Planned Parenthood Action Fund, the political arm of Planned Parenthood of America, thanked the administration.

“This is a victory for women and the more than 30,000 Planned Parenthood supporters who spoke out to ensure all women, no matter what insurance they have, can access the full range of birth control methods without a copay or other barriers,” she said. “We know that increased access to birth control has helped bring teen pregnancy rates to a 40-year low and we must continue to drive forward policies that build on this progress.”

The Kaiser study  — which looked at a sample of 20 insurers in five states — found one that simply didn’t cover the birth control ring (NuvaRing) at all and four that “couldn’t ascertain” whether they covered such birth control implants. More commonly, insurers would restrict access to certain contraceptives when they believed a cheaper, equally effective way for patients to get the same treatment was available.

The report by the health law center, which analyzed coverage from 100 insurance companies during 2014 and 2015, found that 15 plans in seven states failed to cover all FDA-approved methods of birth control. Among the companies named as not complying with the law’s requirements in some states are Aetna, Cigna, Physicians Plus and Anthem Blue Cross Blue Shield.

The insurance industry disputes the reports’ conclusions that the problem is widespread. “This report presents a distorted picture of reality,” Karen Ignagni, president and CEO of America’s Health Insurance Plans, the industry’s primary trade group, said when the report came out.

AHIP did not have an immediate comment Monday on the federal guidance.

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