By EMILY RAMSHAW - The Dallas Morning News - Thursday, December 20, 2007
AUSTIN – House Speaker Tom Craddick has yet to order an interim study on abuse and neglect in Texas' facilities for the mentally retarded – despite saying this summer that curbing the mistreatment was a top priority.
His staff says he's considering appointing a special committee early next year to address the problems, but House Democrats say they can't afford to wait for the state's Republican leadership.
They've convened a legislative study group of their own and begun touring Texas institutions – issuing their first report last week.
"These people are wards of the state, and we are not fulfilling our obligation to protect their safety," said Rep. Lon Burnam, a Fort Worth Democrat who lobbied for a House interim committee but said he couldn't get the support. "I think it's imperative that a study be done. And if the speaker's not going to do an investigation, individual members will."
Texas' care for the disabled came under fire repeatedly this year, with reports of abuse and neglect at state institutions and group homes rivaling conditions in the state's troubled juvenile justice system.
The scrutiny followed a scathing U.S. Justice Department report documenting civil rights violations and horrific living conditions at the Lubbock State School. In the months after that report, The Dallas Morning News documented widespread abuse and neglect at other state institutions for people with disabilities, and vile conditions and debilitating financial problems at dozens of midsize group homes in Dallas County.
Early this week, The News reported that the state's waiting lists for in-home, or non-institutional, care now exceeds 100,000 people – with some families waiting up to a decade for services.
Mr. Craddick first spoke out on the state care facilities in August, saying that improving conditions would be a top priority between legislative sessions. But when his list of interim charges came out this month, the services for the disabled didn't make the cut, leaving advocates to believe they'd been left in the lurch.
Craddick spokeswoman Alexis DeLee said Tuesday that while the speaker hasn't made an interim charge, he is considering appointing a select committee in early 2008 on the services provided to Texas' most profoundly disabled – whether they're in a state school, a private care facility or living in the family home.
House Democrats say they're not holding their breath.
In the meantime, Rep. Garnet Coleman said the legislative study group he chairs is scheduling hearings at state schools – including one next month at the state-operated institution in Denton. They've already released notes on a meeting at the Corpus Christi State School, he said, and plan to have a final report on long-term care for the disabled by November.
Read more in the Dallas Morning News
Friday, December 21, 2007
Friday, December 7, 2007
Medicare drug benefit
By Waxahachie Daily Ligt - Friday, December 7, 2007
The calendar during November and December tends to get a little full. Between Thanksgiving, Christmas and all the festivities in between, often we have more to do than we have time. But one calendar item is essential for any Medicare-eligible senior age 65 and over, the open enrollment season for the Medicare Prescription Drug Benefit.
Running Nov. 15 through Dec. 31, open enrollment allows Medicare recipients to sign up for a prescription drug plan or change their current plan if they so desire. Like the Medicare Prescription Drug Benefit (also known as Medicare Part D), participating in open enrollment season is completely voluntary. Seniors who are happy with the drug coverage they receive from a private plan, or who aren’t interested in signing up for Medicare’s drug benefit by no means have to, and seniors who do have Medicare drug coverage and don’t want to change plans do not need to do anything to continue receiving their coverage.
The prescription drug benefit allows seniors to pick a program that fits their personal health and financial needs. Texas seniors can choose from one of 56 plans during the open enrollment period.
Picking a plan can seem daunting, which is why the Centers for Medicare and Medicaid Services has set up a Web site, www.medicare.gov, and hotline, 1-800-MEDICARE, to assist seniors in comparing plans and selecting the one that is right for them. When using these resources, it’s important to have a list of the medications the senior is taking handy, as it will help determine what plan is right for them. Additional assistance is also available to low-income seniors, so it’s important that these seniors understand the options available to them.
At the conclusion of last year’s open enrollment period, more than 1.4 million Americans had enrolled in the prescription drug benefit. If you or a loved one are eligible and don’t currently have prescription drug coverage or wish to change the coverage you currently have, mark your calendar: Dec. 31, is the last day of open-enrollment. And just like Christmas shopping, it’s best not to wait until the last minute.
The calendar during November and December tends to get a little full. Between Thanksgiving, Christmas and all the festivities in between, often we have more to do than we have time. But one calendar item is essential for any Medicare-eligible senior age 65 and over, the open enrollment season for the Medicare Prescription Drug Benefit.
Running Nov. 15 through Dec. 31, open enrollment allows Medicare recipients to sign up for a prescription drug plan or change their current plan if they so desire. Like the Medicare Prescription Drug Benefit (also known as Medicare Part D), participating in open enrollment season is completely voluntary. Seniors who are happy with the drug coverage they receive from a private plan, or who aren’t interested in signing up for Medicare’s drug benefit by no means have to, and seniors who do have Medicare drug coverage and don’t want to change plans do not need to do anything to continue receiving their coverage.
The prescription drug benefit allows seniors to pick a program that fits their personal health and financial needs. Texas seniors can choose from one of 56 plans during the open enrollment period.
Picking a plan can seem daunting, which is why the Centers for Medicare and Medicaid Services has set up a Web site, www.medicare.gov, and hotline, 1-800-MEDICARE, to assist seniors in comparing plans and selecting the one that is right for them. When using these resources, it’s important to have a list of the medications the senior is taking handy, as it will help determine what plan is right for them. Additional assistance is also available to low-income seniors, so it’s important that these seniors understand the options available to them.
At the conclusion of last year’s open enrollment period, more than 1.4 million Americans had enrolled in the prescription drug benefit. If you or a loved one are eligible and don’t currently have prescription drug coverage or wish to change the coverage you currently have, mark your calendar: Dec. 31, is the last day of open-enrollment. And just like Christmas shopping, it’s best not to wait until the last minute.
Thursday, December 6, 2007
Medicare to Cut Payment for Two Promising Cancer Drugs
By ALEX BERENSON - The New York Times - December 6, 2007
New Medicare rules for a small but promising class of cancer drugs may cause thousands of lymphoma patients to lose access to the treatment, which in some cases is the only therapy available to them.
The companies that make the drugs, and patient advocacy groups, say the changes will sharply cut reimbursement for the medicines next year, and they predict that many hospitals will stop offering the treatments. The Medicare changes come just as new data provide additional evidence that the medicines, called Bexxar and Zevalin, are effective.
The drugs are given to treat non-Hodgkins lymphoma, the fifth-most common cancer, and are usually prescribed for patients who have not responded to other therapies and who have few remaining treatment options. Clinical trial data show that they put the disease into remission for years in many of those patients.
Under the new rules, after Jan. 1, Medicare will reimburse hospitals about $16,000 for each treatment with the drugs, which a patient needs to receive only once. GlaxoSmithKline, which markets Bexxar, say it is priced at almost $30,000 per treatment, and Biogen Idec, which sells Zevalin, says it costs nearly as much. While high, such prices are not unusual for new cancer therapies, which can cost $50,000 or more for a year of treatment.
Senior Medicare officials say they are not trying to prevent hospitals from giving Bexxar and Zevalin. The $16,000 figure is a fair price and is based on the actual prices hospitals have paid for the medicines this year, they say.
Zevalin was introduced in 2002, and Bexxar in 2003. Until now, Medicare has reimbursed each hospital claim individually, without setting a single nationwide price for the drug. The practice has resulted in wildly varying reimbursement, Medicare says.
But the companies say Medicare’s data must be inaccurate and that no hospital will offer the drugs to Medicare patients if it is losing $10,000 or more per treatment. Hospitals typically do not disclose their reimbursement rates, or whether they make money on any given treatment.
Under federal rules, hospitals that do not offer a drug to Medicare patients are barred from offering it to other patients, even if their insurers fully cover the cost of treatment. Because Bexxar and Zevalin contain radioactive material, the drugs must be administered by specially licensed technicians and doctors. They are usually given in hospitals..
Sarah Alspach, a spokeswoman for Glaxo, said the company had voluntarily submitted its pricing data to Medicare to prove that that the hospital claims data is wrong. “Our feeling is there is a flaw in the methodology,” Ms. Alspach said.
Doctors, lymphoma patients, and advocacy groups say they do not understand Medicare’s decision. About 60,000 people are diagnosed with non-Hodgkins lymphoma every year, and 20,000 people die of the disease.
“The explanation that they’re giving is really flawed,” said Dr. Mark Kaminski, the co-director of leukemia and lymphoma transplant program at the University of Michigan. Dr. Kaminski helped discover Bexxar two decades ago and receives a small royalty when the drug is used.
Bexxar and Zevalin are part of a new class of drugs called radioimmunotherapies. They combine a radioactive particle with a biologically engineered molecule that attaches to cancerous white blood cells.
In clinical trials, they have proven as good as or better than standard treatments for non-Hodgkins lymphoma, a cancer of the immune system. In a trial of 414 patients scheduled to be discussed next Monday at a hematology conference, the combination of Zevalin and chemotherapy put lymphoma into remission for three years on average, compared with one year for chemotherapy alone.
Marion Swan, a spokeswoman for the Lymphoma Research Foundation, says the drugs are the only option for some patients. “Our number one concern is that patients have access to all viable treatment options,” she said, “and it looks like this might be denying access.”
The drugs have already faced hurdles because they can require private cancer doctors to transfer their patients to hospitals for the treatments, and the private doctors may view the hospitals as competitors. That problem, and doctors’ general unfamiliarity with the drugs, has left them as niche products used in fewer than 10 percent of patients who are candidates for them.
Advocates for the drugs had hoped that new clinical trial evidence, like the Zevalin data that will be presented next week, would convince more doctors to prescribe them. Now they worry that Medicare’s decision will end most use of the drugs and chill the development of other radioimmunotherapies.
“If you can’t get two products that basically hit home runs into the marketplace, there’s very little incentive for further development,” Dr. Kaminski said.
Herb B. Kuhn, deputy administrator of the Centers for Medicare and Medicaid Services, the agency overseeing Medicare, said that the agency recognized the value of the drugs. But Medicare does not want to overpay for the medicines and believes that hospital data is the most accurate way to set reimbursement, he said.
But most other drugs administered via injection in doctors’ offices or hospital outpatient clinics — as Bexxar and Zevalin are — are not reimbursed on the basis of what hospitals say they have paid. Instead, companies report the average price of their drugs to Medicare. Medicare then reimburses doctors and hospitals at that price, plus a 6 percent fee to cover handling costs.
GlaxoSmithKline said it had asked Medicare to switch to that system for Bexxar. So far, Medicare has refused.
Meanwhile, lymphoma patients are anxiously watching the fight between Medicare and the companies.
Lora Beckwith, 66, was first diagnosed with the disease in 2004. So far, her illness has progressed slowly, but last month, she was told that she would probably need treatment by February.
Because Ms. Beckwith, who lives in Ann Arbor, Mich., has Parkinson’s disease, she cannot receive standard chemotherapy for the disease, making Bexxar and Zevalin among her only alternatives. Now she fears she may not be able to get them.
“I’m not usually a vengeful or resentful person,” she said. “But I am feeling a bit resentful about having this taken away — if I can’t have access to a drug that would extend my life.”
Read more
New Medicare rules for a small but promising class of cancer drugs may cause thousands of lymphoma patients to lose access to the treatment, which in some cases is the only therapy available to them.
The companies that make the drugs, and patient advocacy groups, say the changes will sharply cut reimbursement for the medicines next year, and they predict that many hospitals will stop offering the treatments. The Medicare changes come just as new data provide additional evidence that the medicines, called Bexxar and Zevalin, are effective.
The drugs are given to treat non-Hodgkins lymphoma, the fifth-most common cancer, and are usually prescribed for patients who have not responded to other therapies and who have few remaining treatment options. Clinical trial data show that they put the disease into remission for years in many of those patients.
Under the new rules, after Jan. 1, Medicare will reimburse hospitals about $16,000 for each treatment with the drugs, which a patient needs to receive only once. GlaxoSmithKline, which markets Bexxar, say it is priced at almost $30,000 per treatment, and Biogen Idec, which sells Zevalin, says it costs nearly as much. While high, such prices are not unusual for new cancer therapies, which can cost $50,000 or more for a year of treatment.
Senior Medicare officials say they are not trying to prevent hospitals from giving Bexxar and Zevalin. The $16,000 figure is a fair price and is based on the actual prices hospitals have paid for the medicines this year, they say.
Zevalin was introduced in 2002, and Bexxar in 2003. Until now, Medicare has reimbursed each hospital claim individually, without setting a single nationwide price for the drug. The practice has resulted in wildly varying reimbursement, Medicare says.
But the companies say Medicare’s data must be inaccurate and that no hospital will offer the drugs to Medicare patients if it is losing $10,000 or more per treatment. Hospitals typically do not disclose their reimbursement rates, or whether they make money on any given treatment.
Under federal rules, hospitals that do not offer a drug to Medicare patients are barred from offering it to other patients, even if their insurers fully cover the cost of treatment. Because Bexxar and Zevalin contain radioactive material, the drugs must be administered by specially licensed technicians and doctors. They are usually given in hospitals..
Sarah Alspach, a spokeswoman for Glaxo, said the company had voluntarily submitted its pricing data to Medicare to prove that that the hospital claims data is wrong. “Our feeling is there is a flaw in the methodology,” Ms. Alspach said.
Doctors, lymphoma patients, and advocacy groups say they do not understand Medicare’s decision. About 60,000 people are diagnosed with non-Hodgkins lymphoma every year, and 20,000 people die of the disease.
“The explanation that they’re giving is really flawed,” said Dr. Mark Kaminski, the co-director of leukemia and lymphoma transplant program at the University of Michigan. Dr. Kaminski helped discover Bexxar two decades ago and receives a small royalty when the drug is used.
Bexxar and Zevalin are part of a new class of drugs called radioimmunotherapies. They combine a radioactive particle with a biologically engineered molecule that attaches to cancerous white blood cells.
In clinical trials, they have proven as good as or better than standard treatments for non-Hodgkins lymphoma, a cancer of the immune system. In a trial of 414 patients scheduled to be discussed next Monday at a hematology conference, the combination of Zevalin and chemotherapy put lymphoma into remission for three years on average, compared with one year for chemotherapy alone.
Marion Swan, a spokeswoman for the Lymphoma Research Foundation, says the drugs are the only option for some patients. “Our number one concern is that patients have access to all viable treatment options,” she said, “and it looks like this might be denying access.”
The drugs have already faced hurdles because they can require private cancer doctors to transfer their patients to hospitals for the treatments, and the private doctors may view the hospitals as competitors. That problem, and doctors’ general unfamiliarity with the drugs, has left them as niche products used in fewer than 10 percent of patients who are candidates for them.
Advocates for the drugs had hoped that new clinical trial evidence, like the Zevalin data that will be presented next week, would convince more doctors to prescribe them. Now they worry that Medicare’s decision will end most use of the drugs and chill the development of other radioimmunotherapies.
“If you can’t get two products that basically hit home runs into the marketplace, there’s very little incentive for further development,” Dr. Kaminski said.
Herb B. Kuhn, deputy administrator of the Centers for Medicare and Medicaid Services, the agency overseeing Medicare, said that the agency recognized the value of the drugs. But Medicare does not want to overpay for the medicines and believes that hospital data is the most accurate way to set reimbursement, he said.
But most other drugs administered via injection in doctors’ offices or hospital outpatient clinics — as Bexxar and Zevalin are — are not reimbursed on the basis of what hospitals say they have paid. Instead, companies report the average price of their drugs to Medicare. Medicare then reimburses doctors and hospitals at that price, plus a 6 percent fee to cover handling costs.
GlaxoSmithKline said it had asked Medicare to switch to that system for Bexxar. So far, Medicare has refused.
Meanwhile, lymphoma patients are anxiously watching the fight between Medicare and the companies.
Lora Beckwith, 66, was first diagnosed with the disease in 2004. So far, her illness has progressed slowly, but last month, she was told that she would probably need treatment by February.
Because Ms. Beckwith, who lives in Ann Arbor, Mich., has Parkinson’s disease, she cannot receive standard chemotherapy for the disease, making Bexxar and Zevalin among her only alternatives. Now she fears she may not be able to get them.
“I’m not usually a vengeful or resentful person,” she said. “But I am feeling a bit resentful about having this taken away — if I can’t have access to a drug that would extend my life.”
Read more
Medicare Reform Hits Snag as Administration Threatens Veto if Physician Pay Cut is Reduced
Health groups want Medicare physicians to use electronic prescribing or face financial penalties
By Kaiser Network - Dec. 6, 2007
The Medicare reform package be shaped in the Senate Finance Committee hit a snag yesterday and the Democratic chairman says he needs to consult with House Democrats before proceeding on the legislation. A major piece of the plan is to roll back the 10 percent pay cuts for doctors that Medicare is set to enforce for 2008. Republicans on the committee were fighting for a short-term roll back of the cut when a letter suddenly appeared from the Health and Human Services Secretary that threatened a Bush veto under certain conditions.
Senate Finance Committee Chair Baucus Cancels Medicare Bill Mark Up, Will Negotiate With House Dem
Senate Finance Committee Chair Max Baucus (D-Mont.) on Wednesday canceled plans for a mark up of Medicare legislation and instead will negotiate directly with House Democrats on the measure, CQ HealthBeat reports. The bill would block a 10% cut in Medicare physician fees.
According to CQ HealthBeat, Baucus has "struggled" with committee Republicans over whether to block the physician cuts for one year or two years, as well as on reductions to Medicare Advantage payments to help fund the physician fee fix. Baucus canceled a mark up one day after the Bush administration threatened to veto any bill that includes cuts to MA plans (CQ HealthBeat, 12/5).
HHS Secretary Mike Leavitt on Tuesday in a letter to the Finance Committee wrote that a veto would be recommended for any bill that "results in a loss of access to health care services, benefits or choices" in the MA program; "raises taxes ... to fund spending increases"; or alters Medicare's fiscal status by overturning administration regulatory decisions (Kaiser Daily Health Policy Report, 12/5). (Read text of Leavitt letter below this news story.)
Finance Committee ranking member Chuck Grassley (R-Iowa) on Wednesday said of the veto threat: "What they're really saying is, 'We don't care if the doctors take a 10% cut'" (CQ HealthBeat, 12/5).
E-Prescribing
A coalition of health care and consumer groups announced support for legislation that would require Medicare physicians by 2011 to use electronic prescribing or face financial penalties, CQ HealthBeat reports. The bill's sponsors include Sens. John Kerry (D-Mass.), Debbie Stabenow (D-Mich.) and John Ensign (R-Nev.), and Reps. Allyson Schwartz (D-Pa.) and Jon Porter (R-Nev.).
Bill Vaughan, senior policy analyst at Consumers Union, on Wednesday in a letter to the Senate wrote that the group wants Congress to implement e-prescribing in Medicare and Medicaid and called for the legislation to be included in the Medicare package. The e-prescribing measure would provide physicians with a bonus for each e-prescription written and provide funding for start-up costs associated with adopting the technology. It also would authorize the HHS secretary to provide physicians with one- or two-year hardship waivers if they have difficulty acquiring the technology.
The Bush administration has asked that health information technology adoption requirements be included in any Medicare legislation that would prevent a physician fee cut.
Kerry said, "E-prescribing will save money, save time, save doctors from piles of paperwork and, most importantly, save lives," adding, "Deaths and injuries from handwritten prescriptions could be nearly eliminated if e-prescriptions were adopted on a wide scale. We need to seize this bipartisan opportunity and make this common-sense reform a reality now" (Carey, CQ HealthBeat, 12/5).
Secretary Leavitt Letter to Senators on Medicare Physician Payment Legislation
Text of letter sent to Sen. Max Baucus, chairman, and Sen. Charles Grassley, ranking Republican, on Senate Finance Committee
Read Daily Reports on Kaiser Network.org
By Kaiser Network - Dec. 6, 2007
The Medicare reform package be shaped in the Senate Finance Committee hit a snag yesterday and the Democratic chairman says he needs to consult with House Democrats before proceeding on the legislation. A major piece of the plan is to roll back the 10 percent pay cuts for doctors that Medicare is set to enforce for 2008. Republicans on the committee were fighting for a short-term roll back of the cut when a letter suddenly appeared from the Health and Human Services Secretary that threatened a Bush veto under certain conditions.
Senate Finance Committee Chair Baucus Cancels Medicare Bill Mark Up, Will Negotiate With House Dem
Senate Finance Committee Chair Max Baucus (D-Mont.) on Wednesday canceled plans for a mark up of Medicare legislation and instead will negotiate directly with House Democrats on the measure, CQ HealthBeat reports. The bill would block a 10% cut in Medicare physician fees.
According to CQ HealthBeat, Baucus has "struggled" with committee Republicans over whether to block the physician cuts for one year or two years, as well as on reductions to Medicare Advantage payments to help fund the physician fee fix. Baucus canceled a mark up one day after the Bush administration threatened to veto any bill that includes cuts to MA plans (CQ HealthBeat, 12/5).
HHS Secretary Mike Leavitt on Tuesday in a letter to the Finance Committee wrote that a veto would be recommended for any bill that "results in a loss of access to health care services, benefits or choices" in the MA program; "raises taxes ... to fund spending increases"; or alters Medicare's fiscal status by overturning administration regulatory decisions (Kaiser Daily Health Policy Report, 12/5). (Read text of Leavitt letter below this news story.)
Finance Committee ranking member Chuck Grassley (R-Iowa) on Wednesday said of the veto threat: "What they're really saying is, 'We don't care if the doctors take a 10% cut'" (CQ HealthBeat, 12/5).
E-Prescribing
A coalition of health care and consumer groups announced support for legislation that would require Medicare physicians by 2011 to use electronic prescribing or face financial penalties, CQ HealthBeat reports. The bill's sponsors include Sens. John Kerry (D-Mass.), Debbie Stabenow (D-Mich.) and John Ensign (R-Nev.), and Reps. Allyson Schwartz (D-Pa.) and Jon Porter (R-Nev.).
Bill Vaughan, senior policy analyst at Consumers Union, on Wednesday in a letter to the Senate wrote that the group wants Congress to implement e-prescribing in Medicare and Medicaid and called for the legislation to be included in the Medicare package. The e-prescribing measure would provide physicians with a bonus for each e-prescription written and provide funding for start-up costs associated with adopting the technology. It also would authorize the HHS secretary to provide physicians with one- or two-year hardship waivers if they have difficulty acquiring the technology.
The Bush administration has asked that health information technology adoption requirements be included in any Medicare legislation that would prevent a physician fee cut.
Kerry said, "E-prescribing will save money, save time, save doctors from piles of paperwork and, most importantly, save lives," adding, "Deaths and injuries from handwritten prescriptions could be nearly eliminated if e-prescriptions were adopted on a wide scale. We need to seize this bipartisan opportunity and make this common-sense reform a reality now" (Carey, CQ HealthBeat, 12/5).
Secretary Leavitt Letter to Senators on Medicare Physician Payment Legislation
Text of letter sent to Sen. Max Baucus, chairman, and Sen. Charles Grassley, ranking Republican, on Senate Finance Committee
“We understand the Senate Finance Committee soon intends to consider draft legislation to block the upcoming statutorily mandated reduction in payments to physicians under the fee-for-service Medicare program. As you know, this 10 percent cut would otherwise occur on January 1, 2008. I write to reiterate the Administration's commitment to strengthen and improve Medicare, and to ensure our Nation's seniors continue to have access to, and choices among, high-quality benefits through this important program.
“The Administration looks forward to working with Congress on appropriately offsetting legislation to mitigate the cut to physician reimbursement rates under Medicare. To that end, we ask that Congress adhere to the following principles for an update to the physician fee schedule.
“Such a bill should:
● Pay for any adjustment to the physician fee schedule formula by responsibly adjusting payments to other providers in the fee-for-service Medicare program.
● Bear in mind the impact on beneficiary premiums of potential increases in Part B spending for physicians, when considering appropriate offsets.
● Condition receipt of a portion of any fee adjustment to adoption of certified electronic health information technology. Physicians who do not adopt appropriate, available technology should receive a lower payment than those who do.
● Implement payment policies to ensure patients receive high-quality care in the most medically appropriate and efficient setting without increasing costs for taxpayers or for Medicare and its beneficiaries.
“Conversely, the President's senior advisors would recommend a veto of any bill that:
● Raises taxes on the American people to fund spending increases.
● Results in the loss of access to health care services, benefits, or choices in the Medicare Advantage program, through which nearly 20 percent of seniors and Medicare beneficiaries with disabilities currently receive their benefits.
● Disturbs, undermines, or overturns the many successes of the new Medicare prescription drug benefit.
● Undermines efforts to promote fiscal solvency in the Medicare and Medicaid programs. For example, legislation should not repeal the Medicare funding warning or erode the programs' fiscal integrity by overturning regulatory policies developed by the Administration.
“We look forward to working with you to produce legislation that the President can sign into law. The Office of Management and Budget advises that from the standpoint of the Administration's program, there is no objection to the transmittal of this letter.”
Read Daily Reports on Kaiser Network.org
VIEWPOINT: Myths and Realities about Social Security and Privatization
By National Committee to Preserve Social Security and Medicare - Read More
Senior Advocates Petition Congress to Cut Subsidy to Private Medicare Plans
Medicare reforms being shaped in Senate Finance Committee
Dec. 5, 2007 – Two Medicare advocacy groups poured 48,000 petitions on Congress yesterday as part of their campaign to support Medicare reforms that will halt or reduce the subsidies paid to private Medicare providers. The senior citizens also waived two-dollar bills to symbolize the “extra money” they pay each month in Medicare premiums because of these industry subsidies.
The National Committee to Preserve Social Security and Medicare (NCPSSM) was joined by the Alliance for Retired Americans in delivering the petitions yesterday.
The Senate Finance Committee is considering legislation this week that could include cuts to billions of dollars in subsidies to private insurers. These overpayments will cost the federal government $149 billion dollars over the next decade and cut two years from Medicare's solvency, according to the NCPSSM.
The NCPSSM news release also said, “Seniors want Congress to reduce those subsidies to improve and strengthen Medicare for future generations. Contrary to what the insurance industry claims, cutting industry subsidies is not the same as cutting Medicare.”
"While the President chides Congress for 'wasteful Washington spending', at the same time he and his allies continue to defend providing billions of dollars in subsidies to the insurance industry,” says Max Richtman, NCPSSM Executive Vice President
“Taxpayers and seniors should not have to foot the bill for overpayments to an industry already seeing record profits thanks to the privatization of Medicare. The Medicare Advantage program is the textbook definition of 'wasteful Washington spending' and should be reformed.”
In explaining the $2 bills, Edward F. Coyle, Alliance for Retired Americans Executive Director, said, "While each $2 bill may seem minor on its own, the total cost is significant. And so is the total effect on seniors. Each month, private insurance companies keep getting more, while seniors keep getting less.”
Earlier this fall, National Committee members and supporters mailed 73,000 letters to Congress requesting Medicare improvements. Several other petition drives and member surveys on Medicare are currently underway for delivery to Congress later this year or early 2008, according to NCPSSM.
Editor’s Notes:
The National Committee says it is a nonprofit, nonpartisan organization that acts in the interests of its membership through advocacy, education, services, grassroots efforts and the leadership of the Board of Directors and professional staff. The work of the National Committee is directed toward developing better-informed citizens and voters.
Medicare Package Taking Shape in Congress, HHS Secretary Makes Requests
Senate Finance Committee taking the lead on Medicare reform
Dec. 4, 2007 - HHS Secretary Mike Leavitt on Monday issued a statement to Congress requesting that Medicare legislation not include cuts to Medicare Advantage plans or changes to the Medicare prescription drug benefit, CQ Today reports. Leavitt in the statement said, "Both have proven to be highly popular with the American people and worthy of continued support from Congress."
A mark up of the Medicare package is tentatively scheduled for Wednesday, but the Senate Finance Committee might delay the mark up by at least one day, according to a spokesperson for committee ranking member Chuck Grassley (R-Iowa) (Armstrong, CQ Today, 12/3).
MA plan payments on average are 12% higher than traditional Medicare. The Senate Medicare bill is expected to reduce some additional payments to MA plans to generate revenue, while the House measure would make MA payments equal to traditional Medicare to generate $50 billion over five years.
The Bush administration last week during a meeting with Senate Finance Committee staffers said that it also opposes a provision of the Medicare legislation that would give states more power to penalize private MA plans that use questionable marketing tactics.
According to CongressDaily, "The White House's protest came as a surprise to negotiators, who inserted the new marketing language in response to reports that private [MA] plans were using misleading marketing tactics to get seniors to switch from traditional Medicare by enrolling in the private fee-for-service plans." The package, which could be released as early as Tuesday, would curb a scheduled 10% cut to physician reimbursements. It also is expected to have provisions that change the drug benefit and create rural and low-income subsidies.
Health IT
Leavitt also said that "any new bill should require physicians to implement health information technology that meets department standards in order to be eligible for higher payments from Medicare" (Johnson, CongressDaily, 12/4).
Leavitt said Congress should require physicians to adopt health IT that meets federal standards before it stops a scheduled 10% cut in Medicare physician fees. "Such a requirement would accelerate adoption of this technology considerably and help to drive improvements in health care quality as well as reductions in medical costs and errors," according to Leavitt.
He added, "I'm confident that many members of Congress are of a like mind of this issue, and I will actively work with them in the near future" (CQ HealthBeat, 12/3).
According to the AP/Philadelphia Inquirer, health care analysts have said widespread use of electronic health records will reduce medical errors and could help reduce health care costs. Currently, only 10% of small-group practices and solo physicians use EHRs, the AP/Inquirer reports. The systems can cost anywhere from $20,000 to $40,000 up front, according to the AP/Inquirer (Freking, AP/Philadelphia Inquirer, 12/3).
Sen. Edward Kennedy (D-Mass.) has sponsored a health IT bill (S 1693) that he is trying to get passed before the end of the session, but the Finance Committee has not discussed health IT as part of the Medicare package, CQ Today reports (CQ Today, 12/3).
E-Prescribing
Sens. John Kerry (D-Mass.) and Debbie Stabenow (D-Mich.) plan to introduce stand-alone legislation this week that would require handwritten prescriptions be replaced by electronic prescriptions, but the senators are working with Finance Committee Chair Max Baucus (D-Mont.) and Grassley to add the requirement to the Medicare package, aides said, CongressDaily reports.
The American Medical Association is "wary of an e-prescribing mandate," and its main priority is reversing the 10% physician payment cut, according to CongressDaily.
The Finance Committee package would include one-time payments for physicians to cover the start-up costs and small incentive payments to continue using the systems over three years. Switching to e-prescribing would cost about $2,500 plus losses in productivity during the transition, CongressDaily reports. After three years, physicians would be penalized for not using e-prescribing. Using the technology would save between $5 billion and $15 billion over 10 years, according to some estimates.
"Physicians are eager to adopt new technologies that have the potential to increase patient safety and quality of care, but hitting doctors with an unfunded e-prescribing mandate at the same time the government plans to cut Medicare physician payments 10% next year is untenable," AMA Board Chair Edward Langston said (Johnson [1], CongressDaily, 12/3).
Other Provisions
The Finance Committee has stalled negotiations on a provision of the package that would extend the length of time employers must cover kidney dialysis for employees after a business coalition ran advertisements in a Montana newspaper opposing increased responsibility for employers, according to an aide familiar with the negotiations, CongressDaily reports.
The ad ran in the Billings Gazette and was paid for by the Employers Coalition on Medicare. Under current law, employees with group insurance must receive 30 months of dialysis before Medicare coverage begins. The extension would increase the requirement to 42 months, which would save Medicare $1.2 billion over 10 years, according to the Congressional Budget Office.
Employers say that the change would cost them $3 billion to $4 billion over 10 years because they do not have the purchasing power Medicare has. Baucus was considering removing the requirement from the legislation, but he might be "less inclined to sympathize" with the coalition after the ads ran, according to CongressDaily (Johnson [2], CongressDaily, 12/3).
Read More
Dec. 5, 2007 – Two Medicare advocacy groups poured 48,000 petitions on Congress yesterday as part of their campaign to support Medicare reforms that will halt or reduce the subsidies paid to private Medicare providers. The senior citizens also waived two-dollar bills to symbolize the “extra money” they pay each month in Medicare premiums because of these industry subsidies.
The National Committee to Preserve Social Security and Medicare (NCPSSM) was joined by the Alliance for Retired Americans in delivering the petitions yesterday.
The Senate Finance Committee is considering legislation this week that could include cuts to billions of dollars in subsidies to private insurers. These overpayments will cost the federal government $149 billion dollars over the next decade and cut two years from Medicare's solvency, according to the NCPSSM.
The NCPSSM news release also said, “Seniors want Congress to reduce those subsidies to improve and strengthen Medicare for future generations. Contrary to what the insurance industry claims, cutting industry subsidies is not the same as cutting Medicare.”
"While the President chides Congress for 'wasteful Washington spending', at the same time he and his allies continue to defend providing billions of dollars in subsidies to the insurance industry,” says Max Richtman, NCPSSM Executive Vice President
“Taxpayers and seniors should not have to foot the bill for overpayments to an industry already seeing record profits thanks to the privatization of Medicare. The Medicare Advantage program is the textbook definition of 'wasteful Washington spending' and should be reformed.”
In explaining the $2 bills, Edward F. Coyle, Alliance for Retired Americans Executive Director, said, "While each $2 bill may seem minor on its own, the total cost is significant. And so is the total effect on seniors. Each month, private insurance companies keep getting more, while seniors keep getting less.”
Earlier this fall, National Committee members and supporters mailed 73,000 letters to Congress requesting Medicare improvements. Several other petition drives and member surveys on Medicare are currently underway for delivery to Congress later this year or early 2008, according to NCPSSM.
Editor’s Notes:
The National Committee says it is a nonprofit, nonpartisan organization that acts in the interests of its membership through advocacy, education, services, grassroots efforts and the leadership of the Board of Directors and professional staff. The work of the National Committee is directed toward developing better-informed citizens and voters.
Medicare Package Taking Shape in Congress, HHS Secretary Makes Requests
Senate Finance Committee taking the lead on Medicare reform
Dec. 4, 2007 - HHS Secretary Mike Leavitt on Monday issued a statement to Congress requesting that Medicare legislation not include cuts to Medicare Advantage plans or changes to the Medicare prescription drug benefit, CQ Today reports. Leavitt in the statement said, "Both have proven to be highly popular with the American people and worthy of continued support from Congress."
A mark up of the Medicare package is tentatively scheduled for Wednesday, but the Senate Finance Committee might delay the mark up by at least one day, according to a spokesperson for committee ranking member Chuck Grassley (R-Iowa) (Armstrong, CQ Today, 12/3).
MA plan payments on average are 12% higher than traditional Medicare. The Senate Medicare bill is expected to reduce some additional payments to MA plans to generate revenue, while the House measure would make MA payments equal to traditional Medicare to generate $50 billion over five years.
The Bush administration last week during a meeting with Senate Finance Committee staffers said that it also opposes a provision of the Medicare legislation that would give states more power to penalize private MA plans that use questionable marketing tactics.
According to CongressDaily, "The White House's protest came as a surprise to negotiators, who inserted the new marketing language in response to reports that private [MA] plans were using misleading marketing tactics to get seniors to switch from traditional Medicare by enrolling in the private fee-for-service plans." The package, which could be released as early as Tuesday, would curb a scheduled 10% cut to physician reimbursements. It also is expected to have provisions that change the drug benefit and create rural and low-income subsidies.
Health IT
Leavitt also said that "any new bill should require physicians to implement health information technology that meets department standards in order to be eligible for higher payments from Medicare" (Johnson, CongressDaily, 12/4).
Leavitt said Congress should require physicians to adopt health IT that meets federal standards before it stops a scheduled 10% cut in Medicare physician fees. "Such a requirement would accelerate adoption of this technology considerably and help to drive improvements in health care quality as well as reductions in medical costs and errors," according to Leavitt.
He added, "I'm confident that many members of Congress are of a like mind of this issue, and I will actively work with them in the near future" (CQ HealthBeat, 12/3).
According to the AP/Philadelphia Inquirer, health care analysts have said widespread use of electronic health records will reduce medical errors and could help reduce health care costs. Currently, only 10% of small-group practices and solo physicians use EHRs, the AP/Inquirer reports. The systems can cost anywhere from $20,000 to $40,000 up front, according to the AP/Inquirer (Freking, AP/Philadelphia Inquirer, 12/3).
Sen. Edward Kennedy (D-Mass.) has sponsored a health IT bill (S 1693) that he is trying to get passed before the end of the session, but the Finance Committee has not discussed health IT as part of the Medicare package, CQ Today reports (CQ Today, 12/3).
E-Prescribing
Sens. John Kerry (D-Mass.) and Debbie Stabenow (D-Mich.) plan to introduce stand-alone legislation this week that would require handwritten prescriptions be replaced by electronic prescriptions, but the senators are working with Finance Committee Chair Max Baucus (D-Mont.) and Grassley to add the requirement to the Medicare package, aides said, CongressDaily reports.
The American Medical Association is "wary of an e-prescribing mandate," and its main priority is reversing the 10% physician payment cut, according to CongressDaily.
The Finance Committee package would include one-time payments for physicians to cover the start-up costs and small incentive payments to continue using the systems over three years. Switching to e-prescribing would cost about $2,500 plus losses in productivity during the transition, CongressDaily reports. After three years, physicians would be penalized for not using e-prescribing. Using the technology would save between $5 billion and $15 billion over 10 years, according to some estimates.
"Physicians are eager to adopt new technologies that have the potential to increase patient safety and quality of care, but hitting doctors with an unfunded e-prescribing mandate at the same time the government plans to cut Medicare physician payments 10% next year is untenable," AMA Board Chair Edward Langston said (Johnson [1], CongressDaily, 12/3).
Other Provisions
The Finance Committee has stalled negotiations on a provision of the package that would extend the length of time employers must cover kidney dialysis for employees after a business coalition ran advertisements in a Montana newspaper opposing increased responsibility for employers, according to an aide familiar with the negotiations, CongressDaily reports.
The ad ran in the Billings Gazette and was paid for by the Employers Coalition on Medicare. Under current law, employees with group insurance must receive 30 months of dialysis before Medicare coverage begins. The extension would increase the requirement to 42 months, which would save Medicare $1.2 billion over 10 years, according to the Congressional Budget Office.
Employers say that the change would cost them $3 billion to $4 billion over 10 years because they do not have the purchasing power Medicare has. Baucus was considering removing the requirement from the legislation, but he might be "less inclined to sympathize" with the coalition after the ads ran, according to CongressDaily (Johnson [2], CongressDaily, 12/3).
Read More
Medicare Help on Part D sign-up
By THE WASHINGTON POST - Tuesday, December 4, 2007
Medicare beneficiaries signing up for prescription drug coverage (Medicare Part D) now through Dec. 31 have a new Web tool to help them compare plans and costs.
Called Plan Finder, the Medicare site lists premiums, co-pays and deductibles by state.
Under Medicare regulations, insurers can't change tier prices before 2009 but can move drugs from tier to tier.
But according to the Medicare Rights Center in New York, if you're on the drug before its tier changes, you can continue paying the cheaper price.
Hassles? Call Medicare (800-633-4227).
SOURCES OF HELP
Plan Finder: From Medicare's home page, www.medicare.gov, click on "Medicare Prescription Drug Plans -- 2008 Plan Data."
A comprehensive list of resources for Medicare Part D comes from the staff of Rep. Peter DeFazio, D-Ore.: www.defazio.house.gov.
Medicare: For tips and information, go to www.medicare.gov/medicarereform/drugbenefit.asp.
Medicare Access for Patients-Rx, a coalition of groups providing guidance to people with chronic diseases and disabilities: www.maprx.info.
AARP Medicare Interactive Counselor: www.aarp.org/health/medicare.
Families USA: www.familiesusa.org/issues/medicare/rx-drug-center/for-consumers.
A Kaiser Family Foundation tracker site lets you compare drug plans: www.kff.org/medicare/healthplantracker/index.jsp.
Read more
Medicare Rights Center: www.medicarerights.org. See "A guide through the Medicare maze."
Medicare beneficiaries signing up for prescription drug coverage (Medicare Part D) now through Dec. 31 have a new Web tool to help them compare plans and costs.
Called Plan Finder, the Medicare site lists premiums, co-pays and deductibles by state.
Under Medicare regulations, insurers can't change tier prices before 2009 but can move drugs from tier to tier.
But according to the Medicare Rights Center in New York, if you're on the drug before its tier changes, you can continue paying the cheaper price.
Hassles? Call Medicare (800-633-4227).
SOURCES OF HELP
Plan Finder: From Medicare's home page, www.medicare.gov, click on "Medicare Prescription Drug Plans -- 2008 Plan Data."
A comprehensive list of resources for Medicare Part D comes from the staff of Rep. Peter DeFazio, D-Ore.: www.defazio.house.gov.
Medicare: For tips and information, go to www.medicare.gov/medicarereform/drugbenefit.asp.
Medicare Access for Patients-Rx, a coalition of groups providing guidance to people with chronic diseases and disabilities: www.maprx.info.
AARP Medicare Interactive Counselor: www.aarp.org/health/medicare.
Families USA: www.familiesusa.org/issues/medicare/rx-drug-center/for-consumers.
A Kaiser Family Foundation tracker site lets you compare drug plans: www.kff.org/medicare/healthplantracker/index.jsp.
Read more
Medicare Rights Center: www.medicarerights.org. See "A guide through the Medicare maze."
Big Pharma Faces Grim Prognosis
Industry Fails to Find New Drugs to Replace Wonders Like Lipitor
By BARBARA MARTINEZ and JACOB GOLDSTEIN - The Wall Street Journal - December 6, 2007
Over the next few years, the pharmaceutical business will hit a wall.
Some of the top-selling drugs in industry history will become history as patent protections expire, allowing generics to rush in at much-lower prices. Generic competition is expected to wipe $67 billion from top companies' annual U.S. sales between 2007 and 2012 as more than three dozen drugs lose patent protection. That is roughly half of the companies' combined 2007 U.S. sales
At the same time, the industry's science engine has stalled. The century-old approach of finding chemicals to treat diseases is producing fewer and fewer drugs. Especially lacking are new blockbusters to replace old ones like Lipitor, Plavix and Zyprexa.
The coming sales decline may signal the end of a once-revered way of doing business. "I think the industry is doomed if we don't change," says Sidney Taurel, chairman of Eli Lilly & Co. Just yesterday, Bristol-Myers Squibb Co. announced plans to cut 10% of its work force, or about 4,300 jobs, and close or sell about half of its 27 manufacturing plants by 2010. (Please see related article.)
Between 2011 and 2012, annual industry revenue will decline, estimates Datamonitor, a research and consulting firm. That would be the first decline in at least four decades.
Patent expirations are a big problem. Drugs are granted 20 years of patent protection, although companies often fail to get a product to market before half of that period has elapsed. Once it hits the market, however, the patent-protected drug is highly profitable: Typical gross margins are 90% to 95%. When patents expire, generic makers offer the products at a price much closer to the cost of production.
Pfizer Inc. will be particularly hard-hit when the patent expires as early as 2010 on Lipitor, the cholesterol-lowering blockbuster that ranks as the most successful drug ever. Pharmacists and managed-care companies will aggressively fill prescriptions with generics, reducing annual Lipitor sales to a fraction of last year's $13 billion.
By 2012, Merck & Co. will face generic competition to its three top-selling drugs: the osteoporosis treatment Fosamax, Singulair for asthma and the blood-pressure drug Cozaar. Those three represent 44% of the company's current revenue. Following the loss last year of patent protection for Merck's cholesterol-lowering Zocor, sales this year are expected to fall 82% from $4.38 billion in 2005. A Merck spokeswoman said the company has several products in the pipeline that will offset its patent losses.
The rise of generics wouldn't matter so much if research labs were creating a stream of new hits. But that isn't happening. During the five years from 2002 through 2006, the industry brought to market 43% fewer new chemical-based drugs than in the last five years of the 1990s, despite more than doubling research-and-development spending.
In October, Moody's Investors Service, which rates about $90 billion in U.S. pharmaceutical-company debt, lowered its outlook for the U.S. drug industry to negative from stable. The industry was long considered among the most credit-worthy, but in recent years, Moody's has downgraded giants Schering-Plough Corp., Merck, Bristol-Myers, Pfizer and GlaxoSmithKline PLC. In explaining its diminished outlook, Moody's said that drugs currently in development don't have as much commercial potential as earlier pipelines.
Investors, once huge beneficiaries of drug-industry success, have moved to the sidelines. As the Dow Jones World Index rose 75% in the six years ended Nov. 29, the FTSE Global Pharmaceuticals Index fell 19.8%.
While many patients are benefiting from lower-cost generics, others are waiting in vain for relief of their suffering. "In anxiety disorder, the field has imploded in terms of drug development," said P. Murali Doraiswamy, chief of biological psychiatry at Duke University medical school. "Ten years ago, we had eight or nine different" anxiety-disorder drugs under development, but that has now "come to a halt."
At last month's big American Heart Association meeting in Orlando, Fla., there were just two high-profile studies of experimental drugs on the agenda. One, for Eli Lilly's anti-blood-clotting drug prasugrel, posted results that left some doctors and analysts questioning whether the drug would be a big seller. Lilly, however, says it is "very pleased with the trial's outcome."
The other study was a postmortem on Pfizer's torcetrapib, already known as one of the industry's most costly failures, with $800 million in budgeted research costs.
"There haven't been any new therapies that are proven to reduce death and disability for atherosclerosis since the introduction of the [cholesterol-lowering] statins" in the late 1980s, said Richard C. Pasternak, vice president of Cardiovascular Clinical Research at Merck. Atherosclerosis, a buildup of arterial plaque, is a major cause of heart disease.
As patent expirations loom, pharmaceutical companies are reorganizing. In five years, many may look very different. They will be in new businesses. Their cost structures may be slimmer and more flexible. Some familiar names may disappear in mergers. Companies are installing new leaders, including outsiders like Pfizer Chairman and CEO Jeffrey Kindler, who in 2002 joined the company as general counsel from McDonald's Corp.
"The era that created the modern pharmaceutical industry is in fact over," said Richard Evans, a former Wall Street analyst and now a pharmaceutical consultant.
To be sure, the pharmaceutical industry is still highly profitable. Sales will continue to benefit from the Medicare drug benefit for the elderly and from growth in overseas markets. The industry will continue to produce new drugs, though at too slow a rate to sustain its size and cost structure, analysts assess. Some players, such as Merck, may fare better because of a more productive R&D operation, according to Sanford C. Bernstein & Co. research analyst Timothy Anderson.
It has never been easy to take a drug from the lab, through animal testing and into human trials. The industry estimates only one out of every 5,000 to 10,000 candidates makes it to human trials. And many drugs that work beautifully in animals fail miserably in people.
But those odds seem to have worsened in recent years, prompting debate about whether the cause is government regulation, corporate structure or an excessive scientific reliance on chemicals rather than biology.
Many drug-company executives blame the FDA for pulling back on approvals. "Very few products are being approved today," said Bernard Poussot, incoming chief executive of Wyeth. The heightened scrutiny contributed to delays of two Wyeth products this past summer, the company has said.
Would-be blockbusters such as Novartis AG's diabetes drug Galvus and Sanofi-Aventis's weight-loss drug rimonabant have recently been delayed by the FDA over safety concerns.
Safety concerns have also prompted the agency to require larger studies of new drugs. Novartis CEO Daniel Vasella says this trend has done more than any other to drive up the industry's R&D costs. He cites Novartis's blood-pressure drug Tekturna, approved earlier this year, which had more than 6,000 patients in its late-stage trial. A decade ago, a similar study might have had fewer than 1,000 patients, according to Dr. Vasella.
Christopher DiFrancesco, a spokesman for the FDA, said, "The number of approvals have declined because companies are submitting fewer drugs to the FDA for approval. The threshold for what we consider to be a safe, effective drug hasn't changed."
Some say the industry's ballooning research budgets may be working against productivity. Most companies use a centralized system to allocate research money, and the growing budgets have left the decision making to too few people who are too far removed from the research, suggests Mr. Evans, who worked at Roche's U.S. subsidiary until 1998, spent several years as a Wall Street analyst and is now a consultant at a health-care-consulting firm. He calls the system "a nightmare of complexity."
As evidence of this problem, some in the industry point to Pfizer, with an annual research budget that has grown to $7 billion, highest in the industry. Yet only a handful of drugs discovered in its internal research labs have come to market in the past decade. And late last year, the company lost its most promising hope when the cholesterol drug torcetrapib failed in late-stage trials.
In a statement, Pfizer said it has the largest pipeline of midstage drugs in company history and plans to triple the number of late-stage drugs in its portfolio by 2009.
A few companies, notably GlaxoSmithKline, have begun breaking R&D into smaller groups, though it is too early to gauge results.
Some believe the industry, which grew out of the European chemical business of the late 1800s, has remained too reliant on that foundation. "For all our amazing advances in the last 50 years, we are still working with the tools of the first pharmaceutical revolution...using advanced chemistry to treat disease symptoms," Mr. Taurel of Lilly said in a 2003 speech.
The future, many believe, lies in biotechnology. Unlike traditional, chemistry-based drug development, biotechnology uses biological tools to create entire proteins, often similar to those that occur in the human body. This approach has yielded successful drugs to treat diseases such as anemia, cancer and rheumatoid arthritis.
Biotech drugs are especially appealing because they face no competition from generics: No regulatory pathway yet exists in the U.S. for bringing to market generic biotech drugs. So until Congress creates such a pathway, no generic threat will exist to the $4,400 a month that Genentech Inc. charges for its cancer drug Avastin, or the $200,000 a year that Genzyme Corp. gets for Cerezyme to treat Gaucher disease. And biotechnology products tend to target specialized areas of medicine that don't require mass advertising or armies of salespeople.
So big pharmaceutical companies have spent nearly $76 billion since 2005 to buy biotech companies, according to Health Care M&A Information Service, a unit of Irving Levin Associates Inc., a Norwalk, Conn., research company. While in 2005 there were 33 deals amounting to $16.5 billion, in the first nine months of this year there were 49 deals totaling $28.7 billion, including AstraZeneca PLC's $15.6 billion acquisition of MedImmune, which followed a bidding war against Eli Lilly, among others.
Meanwhile, Novartis and Pfizer recently announced the formation of in-house biotech units.
The dearth of new products has led the industry to invest heavily in marketing and legal tactics that squeeze as much revenue as possible out of existing products. Companies have raised prices; the average price per pill has risen 63% since 2002, according to Michael Krensavage, Raymond James analyst. Companies raised advertising spending to $5.3 billion in 2006 from $2.5 billion in 2001 and since 1995 have nearly tripled the number of industry sales representatives to 100,000.
The industry spent $155 million on lobbying from January 2005 to June 2006, according to the Center for Public Integrity, on "a variety of issues ranging from protecting lucrative drug patents to keeping lower-priced Canadian drugs from being imported." The industry also successfully lobbied against allowing the federal government to negotiate Medicare drug prices, the center said. The lobbying has drawn fire from politicians, doctors and payers, and damaged the industry's public image.
Aware that seven of the top 10 drug launches of 2006 were generics, pharmaceutical giants are pushing more deeply into that business. In first nine months of this year, Novartis's generics unit, Sandoz, grew roughly three times as fast as its branded-drugs business and accounted for nearly 20% of overall revenue. "The balance is changing," says Novartis CEO Dr. Vasella. In the coming quarters, "we will continue to see a faster growth opportunity" in generics.
After Pfizer's antidepressant Zoloft went off-patent last year, the company's own generics unit, Greenstone, launched a generic version of the drug.
Johnson & Johnson has its own generics unit. Other companies cut deals with generics manufacturers, licensing them the right to sell "authorized generics" that are identical to a branded drug that has gone off-patent.
Diversification is another hope. Roche Holding AG is pursuing a $3 billion hostile takeover of Ventana Medical Systems Inc., a diagnostics company that makes the test used to determine whether women with breast cancer should receive Herceptin, a targeted biotechnology drug that Roche sells in some markets.
The bid is part of a broad push further into diagnostics by the company, which said in July that Severin Schwan, who runs the company's diagnostics unit, will take over next year as CEO.
Yet none of these moves are forestalling cost slashing. Pfizer is cutting 20% of its sales force, AstraZeneca is cutting 10% of its employees and Johnson & Johnson is shrinking its staff by 4%, according to Bernstein Research. As many as 50,000 industry positions will be displaced over the next 10 years, according to wealth-management company RegentAtlantic Capital, Chatham, N.J.
AstraZeneca, GlaxoSmithKline and Bristol-Myers Squibb have also recently suggested they will outsource at least some of their manufacturing. "There are lots of people in India, China and Eastern Europe who can make products of the same quality as ours but at significantly less cost," says Bristol-Myers Squibb CEO James Cornelius.
The outsourcing is expected to extend to research. "We don't do any basic research yet in the lower-cost countries, but over the next few years, to be successful you'll have a constant emphasis on looking for that," Mr. Cornelius says.
The coming difficulty is threatening every industry tradition. "I'm talking to you from the 44th floor of an office on Park Avenue," Mr. Cornelius says. "A year from now, I won't be talking to you from the 44th floor because we're going to move downstairs out of these very expensive offices."
--Sarah Rubenstein and Ron Winslow contributed to this article.
Read more
See Sortable Chart for drugs going off patent.
By BARBARA MARTINEZ and JACOB GOLDSTEIN - The Wall Street Journal - December 6, 2007
Over the next few years, the pharmaceutical business will hit a wall.
Some of the top-selling drugs in industry history will become history as patent protections expire, allowing generics to rush in at much-lower prices. Generic competition is expected to wipe $67 billion from top companies' annual U.S. sales between 2007 and 2012 as more than three dozen drugs lose patent protection. That is roughly half of the companies' combined 2007 U.S. sales
At the same time, the industry's science engine has stalled. The century-old approach of finding chemicals to treat diseases is producing fewer and fewer drugs. Especially lacking are new blockbusters to replace old ones like Lipitor, Plavix and Zyprexa.
The coming sales decline may signal the end of a once-revered way of doing business. "I think the industry is doomed if we don't change," says Sidney Taurel, chairman of Eli Lilly & Co. Just yesterday, Bristol-Myers Squibb Co. announced plans to cut 10% of its work force, or about 4,300 jobs, and close or sell about half of its 27 manufacturing plants by 2010. (Please see related article.)
Between 2011 and 2012, annual industry revenue will decline, estimates Datamonitor, a research and consulting firm. That would be the first decline in at least four decades.
Patent expirations are a big problem. Drugs are granted 20 years of patent protection, although companies often fail to get a product to market before half of that period has elapsed. Once it hits the market, however, the patent-protected drug is highly profitable: Typical gross margins are 90% to 95%. When patents expire, generic makers offer the products at a price much closer to the cost of production.
Pfizer Inc. will be particularly hard-hit when the patent expires as early as 2010 on Lipitor, the cholesterol-lowering blockbuster that ranks as the most successful drug ever. Pharmacists and managed-care companies will aggressively fill prescriptions with generics, reducing annual Lipitor sales to a fraction of last year's $13 billion.
By 2012, Merck & Co. will face generic competition to its three top-selling drugs: the osteoporosis treatment Fosamax, Singulair for asthma and the blood-pressure drug Cozaar. Those three represent 44% of the company's current revenue. Following the loss last year of patent protection for Merck's cholesterol-lowering Zocor, sales this year are expected to fall 82% from $4.38 billion in 2005. A Merck spokeswoman said the company has several products in the pipeline that will offset its patent losses.
The rise of generics wouldn't matter so much if research labs were creating a stream of new hits. But that isn't happening. During the five years from 2002 through 2006, the industry brought to market 43% fewer new chemical-based drugs than in the last five years of the 1990s, despite more than doubling research-and-development spending.
In October, Moody's Investors Service, which rates about $90 billion in U.S. pharmaceutical-company debt, lowered its outlook for the U.S. drug industry to negative from stable. The industry was long considered among the most credit-worthy, but in recent years, Moody's has downgraded giants Schering-Plough Corp., Merck, Bristol-Myers, Pfizer and GlaxoSmithKline PLC. In explaining its diminished outlook, Moody's said that drugs currently in development don't have as much commercial potential as earlier pipelines.
Investors, once huge beneficiaries of drug-industry success, have moved to the sidelines. As the Dow Jones World Index rose 75% in the six years ended Nov. 29, the FTSE Global Pharmaceuticals Index fell 19.8%.
While many patients are benefiting from lower-cost generics, others are waiting in vain for relief of their suffering. "In anxiety disorder, the field has imploded in terms of drug development," said P. Murali Doraiswamy, chief of biological psychiatry at Duke University medical school. "Ten years ago, we had eight or nine different" anxiety-disorder drugs under development, but that has now "come to a halt."
At last month's big American Heart Association meeting in Orlando, Fla., there were just two high-profile studies of experimental drugs on the agenda. One, for Eli Lilly's anti-blood-clotting drug prasugrel, posted results that left some doctors and analysts questioning whether the drug would be a big seller. Lilly, however, says it is "very pleased with the trial's outcome."
The other study was a postmortem on Pfizer's torcetrapib, already known as one of the industry's most costly failures, with $800 million in budgeted research costs.
"There haven't been any new therapies that are proven to reduce death and disability for atherosclerosis since the introduction of the [cholesterol-lowering] statins" in the late 1980s, said Richard C. Pasternak, vice president of Cardiovascular Clinical Research at Merck. Atherosclerosis, a buildup of arterial plaque, is a major cause of heart disease.
As patent expirations loom, pharmaceutical companies are reorganizing. In five years, many may look very different. They will be in new businesses. Their cost structures may be slimmer and more flexible. Some familiar names may disappear in mergers. Companies are installing new leaders, including outsiders like Pfizer Chairman and CEO Jeffrey Kindler, who in 2002 joined the company as general counsel from McDonald's Corp.
"The era that created the modern pharmaceutical industry is in fact over," said Richard Evans, a former Wall Street analyst and now a pharmaceutical consultant.
To be sure, the pharmaceutical industry is still highly profitable. Sales will continue to benefit from the Medicare drug benefit for the elderly and from growth in overseas markets. The industry will continue to produce new drugs, though at too slow a rate to sustain its size and cost structure, analysts assess. Some players, such as Merck, may fare better because of a more productive R&D operation, according to Sanford C. Bernstein & Co. research analyst Timothy Anderson.
It has never been easy to take a drug from the lab, through animal testing and into human trials. The industry estimates only one out of every 5,000 to 10,000 candidates makes it to human trials. And many drugs that work beautifully in animals fail miserably in people.
But those odds seem to have worsened in recent years, prompting debate about whether the cause is government regulation, corporate structure or an excessive scientific reliance on chemicals rather than biology.
Many drug-company executives blame the FDA for pulling back on approvals. "Very few products are being approved today," said Bernard Poussot, incoming chief executive of Wyeth. The heightened scrutiny contributed to delays of two Wyeth products this past summer, the company has said.
Would-be blockbusters such as Novartis AG's diabetes drug Galvus and Sanofi-Aventis's weight-loss drug rimonabant have recently been delayed by the FDA over safety concerns.
Safety concerns have also prompted the agency to require larger studies of new drugs. Novartis CEO Daniel Vasella says this trend has done more than any other to drive up the industry's R&D costs. He cites Novartis's blood-pressure drug Tekturna, approved earlier this year, which had more than 6,000 patients in its late-stage trial. A decade ago, a similar study might have had fewer than 1,000 patients, according to Dr. Vasella.
Christopher DiFrancesco, a spokesman for the FDA, said, "The number of approvals have declined because companies are submitting fewer drugs to the FDA for approval. The threshold for what we consider to be a safe, effective drug hasn't changed."
Some say the industry's ballooning research budgets may be working against productivity. Most companies use a centralized system to allocate research money, and the growing budgets have left the decision making to too few people who are too far removed from the research, suggests Mr. Evans, who worked at Roche's U.S. subsidiary until 1998, spent several years as a Wall Street analyst and is now a consultant at a health-care-consulting firm. He calls the system "a nightmare of complexity."
As evidence of this problem, some in the industry point to Pfizer, with an annual research budget that has grown to $7 billion, highest in the industry. Yet only a handful of drugs discovered in its internal research labs have come to market in the past decade. And late last year, the company lost its most promising hope when the cholesterol drug torcetrapib failed in late-stage trials.
In a statement, Pfizer said it has the largest pipeline of midstage drugs in company history and plans to triple the number of late-stage drugs in its portfolio by 2009.
A few companies, notably GlaxoSmithKline, have begun breaking R&D into smaller groups, though it is too early to gauge results.
Some believe the industry, which grew out of the European chemical business of the late 1800s, has remained too reliant on that foundation. "For all our amazing advances in the last 50 years, we are still working with the tools of the first pharmaceutical revolution...using advanced chemistry to treat disease symptoms," Mr. Taurel of Lilly said in a 2003 speech.
The future, many believe, lies in biotechnology. Unlike traditional, chemistry-based drug development, biotechnology uses biological tools to create entire proteins, often similar to those that occur in the human body. This approach has yielded successful drugs to treat diseases such as anemia, cancer and rheumatoid arthritis.
Biotech drugs are especially appealing because they face no competition from generics: No regulatory pathway yet exists in the U.S. for bringing to market generic biotech drugs. So until Congress creates such a pathway, no generic threat will exist to the $4,400 a month that Genentech Inc. charges for its cancer drug Avastin, or the $200,000 a year that Genzyme Corp. gets for Cerezyme to treat Gaucher disease. And biotechnology products tend to target specialized areas of medicine that don't require mass advertising or armies of salespeople.
So big pharmaceutical companies have spent nearly $76 billion since 2005 to buy biotech companies, according to Health Care M&A Information Service, a unit of Irving Levin Associates Inc., a Norwalk, Conn., research company. While in 2005 there were 33 deals amounting to $16.5 billion, in the first nine months of this year there were 49 deals totaling $28.7 billion, including AstraZeneca PLC's $15.6 billion acquisition of MedImmune, which followed a bidding war against Eli Lilly, among others.
Meanwhile, Novartis and Pfizer recently announced the formation of in-house biotech units.
The dearth of new products has led the industry to invest heavily in marketing and legal tactics that squeeze as much revenue as possible out of existing products. Companies have raised prices; the average price per pill has risen 63% since 2002, according to Michael Krensavage, Raymond James analyst. Companies raised advertising spending to $5.3 billion in 2006 from $2.5 billion in 2001 and since 1995 have nearly tripled the number of industry sales representatives to 100,000.
The industry spent $155 million on lobbying from January 2005 to June 2006, according to the Center for Public Integrity, on "a variety of issues ranging from protecting lucrative drug patents to keeping lower-priced Canadian drugs from being imported." The industry also successfully lobbied against allowing the federal government to negotiate Medicare drug prices, the center said. The lobbying has drawn fire from politicians, doctors and payers, and damaged the industry's public image.
Aware that seven of the top 10 drug launches of 2006 were generics, pharmaceutical giants are pushing more deeply into that business. In first nine months of this year, Novartis's generics unit, Sandoz, grew roughly three times as fast as its branded-drugs business and accounted for nearly 20% of overall revenue. "The balance is changing," says Novartis CEO Dr. Vasella. In the coming quarters, "we will continue to see a faster growth opportunity" in generics.
After Pfizer's antidepressant Zoloft went off-patent last year, the company's own generics unit, Greenstone, launched a generic version of the drug.
Johnson & Johnson has its own generics unit. Other companies cut deals with generics manufacturers, licensing them the right to sell "authorized generics" that are identical to a branded drug that has gone off-patent.
Diversification is another hope. Roche Holding AG is pursuing a $3 billion hostile takeover of Ventana Medical Systems Inc., a diagnostics company that makes the test used to determine whether women with breast cancer should receive Herceptin, a targeted biotechnology drug that Roche sells in some markets.
The bid is part of a broad push further into diagnostics by the company, which said in July that Severin Schwan, who runs the company's diagnostics unit, will take over next year as CEO.
Yet none of these moves are forestalling cost slashing. Pfizer is cutting 20% of its sales force, AstraZeneca is cutting 10% of its employees and Johnson & Johnson is shrinking its staff by 4%, according to Bernstein Research. As many as 50,000 industry positions will be displaced over the next 10 years, according to wealth-management company RegentAtlantic Capital, Chatham, N.J.
AstraZeneca, GlaxoSmithKline and Bristol-Myers Squibb have also recently suggested they will outsource at least some of their manufacturing. "There are lots of people in India, China and Eastern Europe who can make products of the same quality as ours but at significantly less cost," says Bristol-Myers Squibb CEO James Cornelius.
The outsourcing is expected to extend to research. "We don't do any basic research yet in the lower-cost countries, but over the next few years, to be successful you'll have a constant emphasis on looking for that," Mr. Cornelius says.
The coming difficulty is threatening every industry tradition. "I'm talking to you from the 44th floor of an office on Park Avenue," Mr. Cornelius says. "A year from now, I won't be talking to you from the 44th floor because we're going to move downstairs out of these very expensive offices."
--Sarah Rubenstein and Ron Winslow contributed to this article.
Read more
See Sortable Chart for drugs going off patent.
Monday, November 5, 2007
Changes ahead for Medicare drug program
By KEVIN FREKING, Associated Press Writer - Sat Nov 3, 2007
WASHINGTON - Nearly 2 million low-income Medicare participants could be switched to different insurance plans for their prescription drug coverage next year.
Millions more will have to shop around if they want to avoid double-digit increases in their monthly premiums.
The reassignment of the poorest beneficiaries and the higher premiums for many others are just two reasons why seniors and the disabled may want to look into other plans as the Medicare drug benefit enters its third year.
The shopping season officially begins Nov. 15 — the first day of an open enrollment period that continues through Dec. 31.
Advocacy groups warn the benefit's 24.5 million participants to take nothing for granted even if they're happy with their current coverage.
"Everybody needs to shop around every year," said Patricia Nemore, senior policy attorney at the Center for Medicare Advocacy. "Just because you like your plan this year doesn't mean that plan will work the same next year."
Under the drug benefit, Medicare subsidizes insurance plans that cover an enrollee's prescription drug buys. The government pays insurers extra for covering the very poor.
The plans adjust their coverage to reflect the changing marketplace. They change which drugs they will cover for safety and financial reasons. They also make adjustments to the monthly premiums they charge customers, trying to maximize demand for their product and profitability.
On average, Medicare Part D plans will charge a monthly premium of $28 in 2008, but the premiums vary widely across the nearly 1,800 plans around the country. The premiums range from $9.80 for a basic benefit to $107.50 for enhanced coverage.
About a quarter of the poorest beneficiaries don't pay any monthly premium. They will still be entitled to that extra benefit next year, but they will have to get their coverage though other plans meeting Medicare's requirements for offering coverage to low-income beneficiaries. Medicare officials sent letters this past week to nearly 2 million people to inform them that they will be moved to a new plan.
Kerry Weems, administrator for the Centers for Medicare and Medicaid Services, said those beneficiaries can opt to stay with their current coverage if they like, but would have to start paying. He anticipates that the government will make changes to the drug benefit in future years to reduce the number of people "pingponging" from insurer to insurer with each new year of coverage.
"It's not good for them," Weems said. "There's some things we could have done this year to avoid that, but it would have meant changing the business rules after companies had bid. That didn't seem like the right thing to do."
Most of the low-income beneficiaries being reassigned participate in plans offered through UnitedHealthcare and Humana, according to an analysis from Avalere Health, a consulting firm based in Washington. Two companies, Silverscript and Medco, should pick up many of the reassignments.
The poorest participants can switch their drug plans at any time, so if they get a reassignment notice from the government, they should make sure their new plan covers all their medicine, Nemore said. They can do that by consulting 1-800-Medicare, or by contacting the State Health Insurance Assistance Program, which has counselors in every state.
But it's not only the poor facing major changes, officials note. Enrollment in the drug benefit is highly concentrated, and some of the most popular plans will charge considerably higher monthly premiums next year.
For example, the most popular plan, the AARP Medicare RX Preferred Plan, will increase its monthly premium by 16 percent. Humana Inc. will increase the premium for its standard plan by 71 percent. And the AARP Medicare RX Save Plan will jump 65 percent, according to Avalere Health.
Silverscript, the ninth largest plan, lowered its monthly premium by 24 percent.
Weems said he had not seen Avalere's analysis, but he pointed out that beneficiaries have a wide array of choices and more than 90 percent of participants can move into a plan with a lower premium than they are currently paying. They just need to shop around, Weems said.
The open enrollment season lasts until Dec. 31, but officials warn beneficiaries that it's safer to make a decision sooner rather than later, if they want to be sure their new coverage is in effect when they pick up their first prescriptions in January.
While the drug benefit affects people differently depending upon their incomes, their health and where they live, the standard benefit looks like this: Participants pay the first $275 in drug costs. Then, the plan pays 75 percent of the tab until total drug costs reach $2,510. That's when beneficiaries hit the so-called doughnut hole, where they pick up all cost until they've paid $4,050 out of pocket. After that point, they only have to pay 5 percent of the tab for their medicine.
About a quarter of the plans offering the drug benefit do cover generic drugs when customers hit the doughnut hole.
___
WASHINGTON - Nearly 2 million low-income Medicare participants could be switched to different insurance plans for their prescription drug coverage next year.
Millions more will have to shop around if they want to avoid double-digit increases in their monthly premiums.
The reassignment of the poorest beneficiaries and the higher premiums for many others are just two reasons why seniors and the disabled may want to look into other plans as the Medicare drug benefit enters its third year.
The shopping season officially begins Nov. 15 — the first day of an open enrollment period that continues through Dec. 31.
Advocacy groups warn the benefit's 24.5 million participants to take nothing for granted even if they're happy with their current coverage.
"Everybody needs to shop around every year," said Patricia Nemore, senior policy attorney at the Center for Medicare Advocacy. "Just because you like your plan this year doesn't mean that plan will work the same next year."
Under the drug benefit, Medicare subsidizes insurance plans that cover an enrollee's prescription drug buys. The government pays insurers extra for covering the very poor.
The plans adjust their coverage to reflect the changing marketplace. They change which drugs they will cover for safety and financial reasons. They also make adjustments to the monthly premiums they charge customers, trying to maximize demand for their product and profitability.
On average, Medicare Part D plans will charge a monthly premium of $28 in 2008, but the premiums vary widely across the nearly 1,800 plans around the country. The premiums range from $9.80 for a basic benefit to $107.50 for enhanced coverage.
About a quarter of the poorest beneficiaries don't pay any monthly premium. They will still be entitled to that extra benefit next year, but they will have to get their coverage though other plans meeting Medicare's requirements for offering coverage to low-income beneficiaries. Medicare officials sent letters this past week to nearly 2 million people to inform them that they will be moved to a new plan.
Kerry Weems, administrator for the Centers for Medicare and Medicaid Services, said those beneficiaries can opt to stay with their current coverage if they like, but would have to start paying. He anticipates that the government will make changes to the drug benefit in future years to reduce the number of people "pingponging" from insurer to insurer with each new year of coverage.
"It's not good for them," Weems said. "There's some things we could have done this year to avoid that, but it would have meant changing the business rules after companies had bid. That didn't seem like the right thing to do."
Most of the low-income beneficiaries being reassigned participate in plans offered through UnitedHealthcare and Humana, according to an analysis from Avalere Health, a consulting firm based in Washington. Two companies, Silverscript and Medco, should pick up many of the reassignments.
The poorest participants can switch their drug plans at any time, so if they get a reassignment notice from the government, they should make sure their new plan covers all their medicine, Nemore said. They can do that by consulting 1-800-Medicare, or by contacting the State Health Insurance Assistance Program, which has counselors in every state.
But it's not only the poor facing major changes, officials note. Enrollment in the drug benefit is highly concentrated, and some of the most popular plans will charge considerably higher monthly premiums next year.
For example, the most popular plan, the AARP Medicare RX Preferred Plan, will increase its monthly premium by 16 percent. Humana Inc. will increase the premium for its standard plan by 71 percent. And the AARP Medicare RX Save Plan will jump 65 percent, according to Avalere Health.
Silverscript, the ninth largest plan, lowered its monthly premium by 24 percent.
Weems said he had not seen Avalere's analysis, but he pointed out that beneficiaries have a wide array of choices and more than 90 percent of participants can move into a plan with a lower premium than they are currently paying. They just need to shop around, Weems said.
The open enrollment season lasts until Dec. 31, but officials warn beneficiaries that it's safer to make a decision sooner rather than later, if they want to be sure their new coverage is in effect when they pick up their first prescriptions in January.
While the drug benefit affects people differently depending upon their incomes, their health and where they live, the standard benefit looks like this: Participants pay the first $275 in drug costs. Then, the plan pays 75 percent of the tab until total drug costs reach $2,510. That's when beneficiaries hit the so-called doughnut hole, where they pick up all cost until they've paid $4,050 out of pocket. After that point, they only have to pay 5 percent of the tab for their medicine.
About a quarter of the plans offering the drug benefit do cover generic drugs when customers hit the doughnut hole.
___
Saturday, November 3, 2007
CAPITAL HIGHLIGHTS: Community college health coverage restored
By Ed Sterling - Wilson County News - Oct. 31, 2007
AUSTIN — Back in June, Gov. Rick Perry used the line-item veto to kill funding passed by the Texas House and Senate that would have continued paying for health benefits of most people who work at community colleges. Perry’s veto prompted criticism from community college employees, state lawmakers, students, and students’ families who faced tuition and fee increases to make up for the loss in funding.
On Oct. 23, Perry, Lt. Gov. David Dewhurst, and Speaker Tom Craddick announced an agreement to allocate $99 million for the state’s share of health benefits, a one-time $55 million transitional payment for fiscal year 2009, and the development of an incentive funding program for community colleges.
As part of the agreement, the governor’s office said, community colleges are asked to rescind tuition, fee, or tax increases adopted for fiscal year 2008 and any tuition, fee, or tax increases under consideration for fiscal year 2009 meant to offset the original veto.
Capitol tape case
Closed-circuit security cameras record human activity in the halls of the state Capitol. Texas’ 3rd Court of Appeals heard arguments in the Texas Observer’s attempt to get access to videotape recordings of activity in the back hallway outside the House Chamber on May 23, 2005.
The Texas Observer, a biweekly investigative journal based in Austin, filed a request with the Texas Department of Public Safety (DPS) to view the tapes under the Texas Public Information Act, a law that makes most government documents available to all citizens. The Texas Observer argues that it would be in the public’s interest to release the tapes, but the DPS has consistently refused, saying that releasing them would compromise Capitol security.
What makes May 23, 2005, so interesting? It is the day Republican activist and campaign donor James Leininger of San Antonio allegedly met with lawmakers in the hallway when a vote on legislation to allow a pilot school voucher program was up for a vote. The Texas Observer wants to see if the tapes reveal interaction between Leininger and lawmakers.
Now, after many months in the legal process, the matter may take the 3rd Court of Appeals’ three-judge panel days, weeks, or months to rule on the matter.
Early voting
Registered voters can take advantage of early voting through Nov. 2.
Computer users can easily determine polling locations and hours, by going to the Secretary of State’s Web site. www.sos.state.tx.us.
Read more in the Wilson County News
AUSTIN — Back in June, Gov. Rick Perry used the line-item veto to kill funding passed by the Texas House and Senate that would have continued paying for health benefits of most people who work at community colleges. Perry’s veto prompted criticism from community college employees, state lawmakers, students, and students’ families who faced tuition and fee increases to make up for the loss in funding.
On Oct. 23, Perry, Lt. Gov. David Dewhurst, and Speaker Tom Craddick announced an agreement to allocate $99 million for the state’s share of health benefits, a one-time $55 million transitional payment for fiscal year 2009, and the development of an incentive funding program for community colleges.
As part of the agreement, the governor’s office said, community colleges are asked to rescind tuition, fee, or tax increases adopted for fiscal year 2008 and any tuition, fee, or tax increases under consideration for fiscal year 2009 meant to offset the original veto.
Capitol tape case
Closed-circuit security cameras record human activity in the halls of the state Capitol. Texas’ 3rd Court of Appeals heard arguments in the Texas Observer’s attempt to get access to videotape recordings of activity in the back hallway outside the House Chamber on May 23, 2005.
The Texas Observer, a biweekly investigative journal based in Austin, filed a request with the Texas Department of Public Safety (DPS) to view the tapes under the Texas Public Information Act, a law that makes most government documents available to all citizens. The Texas Observer argues that it would be in the public’s interest to release the tapes, but the DPS has consistently refused, saying that releasing them would compromise Capitol security.
What makes May 23, 2005, so interesting? It is the day Republican activist and campaign donor James Leininger of San Antonio allegedly met with lawmakers in the hallway when a vote on legislation to allow a pilot school voucher program was up for a vote. The Texas Observer wants to see if the tapes reveal interaction between Leininger and lawmakers.
Now, after many months in the legal process, the matter may take the 3rd Court of Appeals’ three-judge panel days, weeks, or months to rule on the matter.
Early voting
Registered voters can take advantage of early voting through Nov. 2.
Computer users can easily determine polling locations and hours, by going to the Secretary of State’s Web site. www.sos.state.tx.us.
Read more in the Wilson County News
Thursday, October 25, 2007
PPPHI's Nominee for Dumbest Move of Day: Pa. bans hormone note on milk labels
By Harold Brubaker - Philadelphia Inquirer Staff Writer - Oct. 25, 2007
The Pennsylvania Department of Agriculture is putting the kibosh on the increasingly popular milk labels that say dairy cows were not treated with artificial growth hormones.
The move surprised Wawa Inc., which just last week joined the rush of retailers and milk processors that say their milk will not be produced with the aid of artificial growth hormones, which are used to boost production.
"Early on, we've had some positive feedback," Wawa spokeswoman Lori Bruce said yesterday. "We think that consumers want to know."
Wawa's label says that the farmers it buys raw milk from have pledged not to use rBST, or recombinant bovine somatotropin. The label includes notice that the U.S. Food and Drug Administration has found no significant difference between milk from treated and untreated cows.
The state change in labeling guidelines, which blindsided many in the industry, is part of a broader effort by the Pennsylvania agriculture department to crack down on labels that highlight what is not in a product, such as "antibiotic-free" and "pesticide-free."
The department said yesterday that it had examined labels from 140 companies and notified 16 companies that they would have to correct their labels by Jan. 1. Those labels contain variations on the claim that cows were not injected with synthetic growth hormones. Three also include a "no antibiotics" claim.
Agriculture Secretary Dennis Wolff said in a news release that "antibiotic-free" and "pesticide-free" are misleading because all processed milk sold in the state is tested a minimum of 10 times for such substances, which are not permitted in milk.
The problem with the claim that cows are not treated with synthetic hormones is that there is no way to distinguish between the natural growth hormone in milk and the artificial version, Wolff said.
Advocates for sustainable agriculture favor the label regarding artificial growth hormones, especially if a more stringent verification process can be established.
"The consumer needs to be able to make a choice and needs to have the information to make a decision," said Leslie Zuck, executive director of Pennsylvania Certified Organic, a nonprofit in Centre Hall, Pa., that certifies organic farmers.
Read more in the Philadelphia Inquirer
The Pennsylvania Department of Agriculture is putting the kibosh on the increasingly popular milk labels that say dairy cows were not treated with artificial growth hormones.
The move surprised Wawa Inc., which just last week joined the rush of retailers and milk processors that say their milk will not be produced with the aid of artificial growth hormones, which are used to boost production.
"Early on, we've had some positive feedback," Wawa spokeswoman Lori Bruce said yesterday. "We think that consumers want to know."
Wawa's label says that the farmers it buys raw milk from have pledged not to use rBST, or recombinant bovine somatotropin. The label includes notice that the U.S. Food and Drug Administration has found no significant difference between milk from treated and untreated cows.
The state change in labeling guidelines, which blindsided many in the industry, is part of a broader effort by the Pennsylvania agriculture department to crack down on labels that highlight what is not in a product, such as "antibiotic-free" and "pesticide-free."
The department said yesterday that it had examined labels from 140 companies and notified 16 companies that they would have to correct their labels by Jan. 1. Those labels contain variations on the claim that cows were not injected with synthetic growth hormones. Three also include a "no antibiotics" claim.
Agriculture Secretary Dennis Wolff said in a news release that "antibiotic-free" and "pesticide-free" are misleading because all processed milk sold in the state is tested a minimum of 10 times for such substances, which are not permitted in milk.
The problem with the claim that cows are not treated with synthetic hormones is that there is no way to distinguish between the natural growth hormone in milk and the artificial version, Wolff said.
Advocates for sustainable agriculture favor the label regarding artificial growth hormones, especially if a more stringent verification process can be established.
"The consumer needs to be able to make a choice and needs to have the information to make a decision," said Leslie Zuck, executive director of Pennsylvania Certified Organic, a nonprofit in Centre Hall, Pa., that certifies organic farmers.
Read more in the Philadelphia Inquirer
Allstate profit under fire - Regulators also call reinsurance into question in debating refunds
By PURVA PATEL - Copyright 2007 Houston Chronicle - Oct. 25, 2007
Allstate Texas Lloyds factored in excessive profits and costs into its latest rate increase imposed on Texas homeowners, regulators allege in an order demanding refunds.
Those are just two on a list of concerns the Texas Department of Insurance has with the way the company justifies its rates.
But for the state's insurance consumer advocate, they are the two most significant — the company's targeted profit and cost of reinsurance, or the coverage it buys to help pay for claims after a catastrophe.
In August, Allstate implemented a flat 5.9 percent increase statewide and an additional average 2.1 percent bump for homeowners in some coastal and near-coastal counties upon renewal.
Regulators then issued an order halting the hike, but Allstate obtained a judge's ruling blocking the state from preventing the increase.
Allstate is preparing to fight the refund order at an administrative law judge hearing scheduled for Dec. 3 in Austin.
"We are confident in the number, and we believe it puts us in a good place and a responsible place for our customers," said Bill Mellander, a spokesman for the insurer. "We would not have implemented these rates if we didn't believe them to be justified, competitive and strong from a consumer perspective."
A spokesman for the department declined to comment on the refund order's specifics.
"We look forward to debating the merits of the rates themselves," said Jerry Hagins, a spokesman for the department.
Various costs
The Insurance Department examines how a company factors various costs and potential profits into its rates to determine if the rates are justified.
One of the more significant factors mentioned in the refund order is Allstate's profit provision, or how much of its collected premiums the company hopes to have left over after paying out losses and expenses, said Rod Bordelon, head of the Office of Public Insurance Counsel, who represents consumers at rate hearings.
The company has a target of 10.4 percent.
"In our view it's grossly too high," Bordelon said.
His office hasn't determined exactly what it should be, he said, but will after it gets more information from the company. He says it's the highest profit provision he's ever seen a Texas home insurer use.
Bordelon notes that profit targets are subjective and companies that take on more risk may expect more of a profit.
"Homeowners is fairly risky, but it doesn't result in huge differences among companies," he said, adding that Allstate has some exposure to risky parts of Texas but is also spread out all over the state and has cut back coverage in some areas, which mitigates some of the riskiness in their business.
Mellander said 10.4 percent is not unusual. He declined to say if this is the first time Allstate has used a profit provision of more than 10 percent for homeowners insurance in Texas.
"Define reasonable," he said. "It's frustrating to see anyone out there making these blanket statements. Well, what's a reasonable profit and what qualifies them to say it's reasonable?"
He also said that if Allstate hadn't pulled back on some of the coverage it offers in Texas, its rates would potentially be even higher.
Balancing act
Insurance companies, especially those that are public, have to play a delicate balancing act, said Craig Weber, a senior analyst with consulting company Celent. Allstate Texas Lloyds is subsidiary of its parent, Allstate Corp.
"I'm sure if I'm an Allstate shareholder, I'm anxious for them to be profitable and keep the stock price healthy," Weber said. "As an Allstate customer, I would want them to keep the rates affordable. They serve many masters."
Allstate Texas Lloyds has about 600,000 home policyholders in Texas and collected $719 million in premiums in 2006.
Reinsurance questioned
Regulators also claim Allstate's estimate of its net cost of reinsurance is too high. The net cost is the actual cost of the coverage, $82.4 million, minus the amount it expects to recover from a reinsurer after a catastrophe, $38.4 million, according to the company's filing.
That cost is usually passed on to consumers as part of their insurance rates.
In the refund order, regulators also note concerns raised by Bordelon's office, such as whether Allstate needs reinsurance, or so much, since the company has reduced its exposure and whether consumers should have to bear the costs for the reinsurance at all.
Allstate stopped writing new homeowners business in some Texas coastal areas in March 2006 and later stopped renewing windstorm coverage for policyholders along the coast.
Allstate says its estimate net cost of reinsurance of $44 million is accurate and that it doesn't pass on all the costs of the coverage to consumers. Mellander declined to say what percent of the cost the company retains.
Without reinsurance, the company's rates could be higher, he said.
"It allows us to assume a little more risk, take on a little more coverage, and it allows us to manage the costs passed on to consumers," he said.
Allstate Texas Lloyds factored in excessive profits and costs into its latest rate increase imposed on Texas homeowners, regulators allege in an order demanding refunds.
Those are just two on a list of concerns the Texas Department of Insurance has with the way the company justifies its rates.
But for the state's insurance consumer advocate, they are the two most significant — the company's targeted profit and cost of reinsurance, or the coverage it buys to help pay for claims after a catastrophe.
In August, Allstate implemented a flat 5.9 percent increase statewide and an additional average 2.1 percent bump for homeowners in some coastal and near-coastal counties upon renewal.
Regulators then issued an order halting the hike, but Allstate obtained a judge's ruling blocking the state from preventing the increase.
Allstate is preparing to fight the refund order at an administrative law judge hearing scheduled for Dec. 3 in Austin.
"We are confident in the number, and we believe it puts us in a good place and a responsible place for our customers," said Bill Mellander, a spokesman for the insurer. "We would not have implemented these rates if we didn't believe them to be justified, competitive and strong from a consumer perspective."
A spokesman for the department declined to comment on the refund order's specifics.
"We look forward to debating the merits of the rates themselves," said Jerry Hagins, a spokesman for the department.
Various costs
The Insurance Department examines how a company factors various costs and potential profits into its rates to determine if the rates are justified.
One of the more significant factors mentioned in the refund order is Allstate's profit provision, or how much of its collected premiums the company hopes to have left over after paying out losses and expenses, said Rod Bordelon, head of the Office of Public Insurance Counsel, who represents consumers at rate hearings.
The company has a target of 10.4 percent.
"In our view it's grossly too high," Bordelon said.
His office hasn't determined exactly what it should be, he said, but will after it gets more information from the company. He says it's the highest profit provision he's ever seen a Texas home insurer use.
Bordelon notes that profit targets are subjective and companies that take on more risk may expect more of a profit.
"Homeowners is fairly risky, but it doesn't result in huge differences among companies," he said, adding that Allstate has some exposure to risky parts of Texas but is also spread out all over the state and has cut back coverage in some areas, which mitigates some of the riskiness in their business.
Mellander said 10.4 percent is not unusual. He declined to say if this is the first time Allstate has used a profit provision of more than 10 percent for homeowners insurance in Texas.
"Define reasonable," he said. "It's frustrating to see anyone out there making these blanket statements. Well, what's a reasonable profit and what qualifies them to say it's reasonable?"
He also said that if Allstate hadn't pulled back on some of the coverage it offers in Texas, its rates would potentially be even higher.
Balancing act
Insurance companies, especially those that are public, have to play a delicate balancing act, said Craig Weber, a senior analyst with consulting company Celent. Allstate Texas Lloyds is subsidiary of its parent, Allstate Corp.
"I'm sure if I'm an Allstate shareholder, I'm anxious for them to be profitable and keep the stock price healthy," Weber said. "As an Allstate customer, I would want them to keep the rates affordable. They serve many masters."
Allstate Texas Lloyds has about 600,000 home policyholders in Texas and collected $719 million in premiums in 2006.
Reinsurance questioned
Regulators also claim Allstate's estimate of its net cost of reinsurance is too high. The net cost is the actual cost of the coverage, $82.4 million, minus the amount it expects to recover from a reinsurer after a catastrophe, $38.4 million, according to the company's filing.
That cost is usually passed on to consumers as part of their insurance rates.
In the refund order, regulators also note concerns raised by Bordelon's office, such as whether Allstate needs reinsurance, or so much, since the company has reduced its exposure and whether consumers should have to bear the costs for the reinsurance at all.
Allstate stopped writing new homeowners business in some Texas coastal areas in March 2006 and later stopped renewing windstorm coverage for policyholders along the coast.
Allstate says its estimate net cost of reinsurance of $44 million is accurate and that it doesn't pass on all the costs of the coverage to consumers. Mellander declined to say what percent of the cost the company retains.
Without reinsurance, the company's rates could be higher, he said.
"It allows us to assume a little more risk, take on a little more coverage, and it allows us to manage the costs passed on to consumers," he said.
Wednesday, October 24, 2007
Court upholds Allstate homeowner insurance increase - State's attempt to roll back 5.9% rate hike is rejected
By Texas Watch - Oct. 18,2007
State's attempt to roll back 5.9% rate hike is rejected Court upholds Allstate homeowner insurance increase
By CHRISTY HOPPE - The Dallas Morning News - Oct. 18, 2007
AUSTIN – Allstate Insurance can continue to charge a 5.9 percent rate increase that it imposed on homeowner policies in August after a court threw out the state's attempt to roll back the increase.
Allstate maintained that its rate increase followed state law and that the Texas Department of Insurance acted improperly in trying to nullify it. A state district judge in Travis County agreed and issued an order Monday evening.
Bill Mellander, a spokesman for Allstate, said the insurer had been certain the judge would affirm that the increase was implemented correctly.
"We are equally as confident that the rate itself is competitive, justified and, more importantly, that it is attractive and good for the consumer," Mr. Mellander said.
Insurance Department spokesman Jerry Hagins said the agency is disappointed in the judge's ruling but stands by its decision that the new rate is excessive. The agency will continue to pursue an order requiring Allstate to roll back its rates and give refunds to customers.
At issue is the state's "file and use" law, which largely has unregulated insurance rates. As envisioned by lawmakers, insurance companies can file notice of new rates with the state insurance agency but don't have to wait for the regulatory process before using the new charges.
If the state found the new rates to be excessive, the insurance agency could order them rolled back and the insurer would reimburse its policyholders.
In Allstate's case, the company already is in court over a 2004 rate hike, fighting the state's contention that it overcharged its policyholders $56 million and owes them a refund.
When it filed the rate hike in August, the charges took effect immediately, but the state fought the increase, saying it disapproved of the new amount. The judge said Allstate followed the law.
"This says that the file-and-use system is broken," said Alex Winslow, executive director of Texas Watch, a consumer-advocacy group.
He said that if history is a guide, the state will again find new rates excessive and Allstate will go to court and fight any refunds.
"I don't think Allstate policyholders should be holding their breath," Mr. Winslow said.
The state's largest home insurer, State Farm, has been fighting a customer refund in the courts since 2003.
With the rate hikes effective immediately, the state has to play catch-up to determine whether the rate is unjustified.
"The bottom line is that Allstate is driving a huge truck through a loophole in the law, and I have no doubt that other insurance companies are cranking up their engines as we speak," Mr. Winslow said.
Staff writer Karen Brooks contributed to this report.
Read more in the Dallas Morning News
Travis County District Judge Margaret Cooper has ruled that a loophole in state law allows Allstate to continue charging its policyholders a rate that the insurance department deems excessive. Texas Watch points to this as an example of how Texas's current system of insurance industry oversight is broken and is calling on lawmakers to give the insurance commissioner the authority to approve rates before - not after - they are imposed on Texas homeowners.
State's attempt to roll back 5.9% rate hike is rejected Court upholds Allstate homeowner insurance increase
By CHRISTY HOPPE - The Dallas Morning News - Oct. 18, 2007
AUSTIN – Allstate Insurance can continue to charge a 5.9 percent rate increase that it imposed on homeowner policies in August after a court threw out the state's attempt to roll back the increase.
Allstate maintained that its rate increase followed state law and that the Texas Department of Insurance acted improperly in trying to nullify it. A state district judge in Travis County agreed and issued an order Monday evening.
Bill Mellander, a spokesman for Allstate, said the insurer had been certain the judge would affirm that the increase was implemented correctly.
"We are equally as confident that the rate itself is competitive, justified and, more importantly, that it is attractive and good for the consumer," Mr. Mellander said.
Insurance Department spokesman Jerry Hagins said the agency is disappointed in the judge's ruling but stands by its decision that the new rate is excessive. The agency will continue to pursue an order requiring Allstate to roll back its rates and give refunds to customers.
At issue is the state's "file and use" law, which largely has unregulated insurance rates. As envisioned by lawmakers, insurance companies can file notice of new rates with the state insurance agency but don't have to wait for the regulatory process before using the new charges.
If the state found the new rates to be excessive, the insurance agency could order them rolled back and the insurer would reimburse its policyholders.
In Allstate's case, the company already is in court over a 2004 rate hike, fighting the state's contention that it overcharged its policyholders $56 million and owes them a refund.
When it filed the rate hike in August, the charges took effect immediately, but the state fought the increase, saying it disapproved of the new amount. The judge said Allstate followed the law.
"This says that the file-and-use system is broken," said Alex Winslow, executive director of Texas Watch, a consumer-advocacy group.
He said that if history is a guide, the state will again find new rates excessive and Allstate will go to court and fight any refunds.
"I don't think Allstate policyholders should be holding their breath," Mr. Winslow said.
The state's largest home insurer, State Farm, has been fighting a customer refund in the courts since 2003.
With the rate hikes effective immediately, the state has to play catch-up to determine whether the rate is unjustified.
"The bottom line is that Allstate is driving a huge truck through a loophole in the law, and I have no doubt that other insurance companies are cranking up their engines as we speak," Mr. Winslow said.
Staff writer Karen Brooks contributed to this report.
Read more in the Dallas Morning News
Friday, October 19, 2007
Star Telegram Opinion: A rational vote
Editorial - Fort Worth Star-Telegram - Oct. 18, 2007
Children's healthcare shouldn't be a partisan issue. And the U.S. House can send that message today by voting to override President Bush's ill-advised and unnecessary veto of a reauthorization of the Children's Health Insurance Program, also known as SCHIP.
In September, 45 Republicans and 220 Democrats voted to approve a package that largely tracked a Senate CHIP bill. Senators from both parties joined to pass the compromise measure with a veto-proof majority.
Reps. Kay Granger of Fort Worth and Michael Burgess of Lewisville, who joined too many Texas Republicans in voting against the bill, surely don't oppose providing health coverage for children in struggling families. But they are misguided in not agreeing that the package is a workable, reasonable way to continue a valuable program and extend coverage to millions of children who otherwise would remain uninsured.
The bill, which would add $35 billion to CHIP over five years, would bring total spending for the program to $60 billion. It would cover about 4 million more children, the majority of whom already are eligible though not enrolled.
Bush has insisted on adding only $1 billion a year, for a total of $30 billion over five years. But that wouldn't even maintain coverage for children currently enrolled; even Republicans who support the $35 billion expansion point out that Bush's level of funding would cause 800,000 children to be dropped.
Perhaps the most misleading criticism of the expansion is that it amounts to middle-class welfare that would prompt thousands to jump from private insurance to the public dole.
Republican and Democratic negotiators -- including Sens. Orrin Hatch of Utah, Charles Grassley of Iowa and Max Baucus of Montana -- crafted a bill that answers concerns of critics who said the program had strayed from its roots. The measure includes incentives for states to not expand eligibility limits too far and to enroll uninsured children on the lower end of the income scale. The measure bars coverage of legal and illegal immigrants. It prevents states from extending coverage to parents or childless adults.
In Texas, families earning up to 200 percent of the federal poverty line ($41,300 for a family of four) are eligible for CHIP, and about 327,000 children currently are covered. But of the 1.5 million uninsured children in Texas, about two-thirds fall below 200 percent of the poverty line, according to the Austin-based Center for Public Policy Priorities.
Other approaches might provide more efficient, less expensive ways of extending coverage to the uninsured. But none is developed enough to offer a practical, available alternative to the CHIP plan that already has won support from a large majority of both chambers in Congress and more than 40 of the nation's governors.
A vote to override Bush isn't a vote for reckless spending -- it's a vote for rationality.
Children's healthcare shouldn't be a partisan issue. And the U.S. House can send that message today by voting to override President Bush's ill-advised and unnecessary veto of a reauthorization of the Children's Health Insurance Program, also known as SCHIP.
In September, 45 Republicans and 220 Democrats voted to approve a package that largely tracked a Senate CHIP bill. Senators from both parties joined to pass the compromise measure with a veto-proof majority.
Reps. Kay Granger of Fort Worth and Michael Burgess of Lewisville, who joined too many Texas Republicans in voting against the bill, surely don't oppose providing health coverage for children in struggling families. But they are misguided in not agreeing that the package is a workable, reasonable way to continue a valuable program and extend coverage to millions of children who otherwise would remain uninsured.
The bill, which would add $35 billion to CHIP over five years, would bring total spending for the program to $60 billion. It would cover about 4 million more children, the majority of whom already are eligible though not enrolled.
Bush has insisted on adding only $1 billion a year, for a total of $30 billion over five years. But that wouldn't even maintain coverage for children currently enrolled; even Republicans who support the $35 billion expansion point out that Bush's level of funding would cause 800,000 children to be dropped.
Perhaps the most misleading criticism of the expansion is that it amounts to middle-class welfare that would prompt thousands to jump from private insurance to the public dole.
Republican and Democratic negotiators -- including Sens. Orrin Hatch of Utah, Charles Grassley of Iowa and Max Baucus of Montana -- crafted a bill that answers concerns of critics who said the program had strayed from its roots. The measure includes incentives for states to not expand eligibility limits too far and to enroll uninsured children on the lower end of the income scale. The measure bars coverage of legal and illegal immigrants. It prevents states from extending coverage to parents or childless adults.
In Texas, families earning up to 200 percent of the federal poverty line ($41,300 for a family of four) are eligible for CHIP, and about 327,000 children currently are covered. But of the 1.5 million uninsured children in Texas, about two-thirds fall below 200 percent of the poverty line, according to the Austin-based Center for Public Policy Priorities.
Other approaches might provide more efficient, less expensive ways of extending coverage to the uninsured. But none is developed enough to offer a practical, available alternative to the CHIP plan that already has won support from a large majority of both chambers in Congress and more than 40 of the nation's governors.
A vote to override Bush isn't a vote for reckless spending -- it's a vote for rationality.
Monday, October 15, 2007
At human services, they need humans to answer phones
By DAVE LIEBER - Star-Telegram staff writer - Sun, Oct. 14, 2007
Pat Dapeer said that if The Watchdog didn't believe what she was saying, he should try for himself.
Make phone calls to the state offices that handle the food stamp program. See if anyone answers the telephone. She almost dared me.
The 66-year-old disabled Watauga woman says it's a tossup which is worse: going hungry or dealing with the food stamp bureaucracy.
Let me summarize how my telephone testing of the Texas Health and Human Services Commission offices went.
Ring ... ring ... ring. No answering machine of any kind on calls to a local food stamp office. Just ring ... ring ... ring.
On some other phone lines I tested, an automated voice machine answered the phone and led me through prompts. But the voice system doesn't let you go backward. If you hit a wrong button, it tells you to call again before saying, "Goodbye." On another customer-assistance line, I called a half-dozen times to hear all the choices, which usually led me to more automated voice systems or the dreaded ring ... ring ... ring.
Twice, I found human beings on the other end of an HHS phone. But these people I spoke to from HHS didn't argue when I told them of Dapeer's frustrations. They know.
"A huge problem," HHS spokeswoman Stephanie Goodman said. "For years, we had high caseloads and antiquated technology and phone systems in our offices. We've been trying to undergo an effort to modernize."
The ringing phones are fallout from a major experiment in state government that nearly everyone involved calls a disaster. Texas tried to become the first state to outsource to private companies the administration of its top assistance programs such as food stamps, Medicaid and cash assistance for needy families.
The state hired a group of companies, led by technology consulting firm Accenture, for $899 million for five years to run call centers, update the department's technology systems and perform other duties. But the company's debut in several Central Texas call centers was such a disaster that state officials called the project off. By then, though, many longtime state employees had left, thinking their jobs were gone.
The results are skimpy front lines of state workers helping those needing assistance. Those who need to call these phone numbers for assistance include applicants who are denied benefits and wish to appeal, disabled people who can't travel and people like Dapeer who have questions about existing benefits.
Governing magazine published a September report on "The Struggle to Streamline" that said Texas' venture into privatization "turned into a dark comedy of bungled work; unanswered and dropped calls; applications lost, ignored and misdirected."
Dapeer said: "Just because we're on food stamps is no reason for us to put up with that type of service. We lose our pride when we have to do that to begin with, and when we have to go through the other garbage we have to deal with, well, that just puts us lower on the totem pole."
When Dapeer couldn't get anywhere with HHS officials in solving the problem with her benefits, she complained to the Texas attorney general's office.
Suddenly, HHS officials were answering her calls and trying to work with her.
"A person shouldn't have to go to the attorney general to get something done," she said.
HHS spokeswoman Goodman says that changes are in the works. New telephone systems are coming for 22 of more than 300 field offices. Most of the 22 are in urban areas, where phones are less likely to be answered. The Fort Worth office on John T. White Road is scheduled for new phones, she says. Other offices will have to wait.
The Watchdog's testing of the phone system yielded a few results that should embarrass the state:
The operator's phone at the John T. White Road office in Fort Worth was never picked up.
A voice on an automated phone system directs callers to a different phone number if they want information. But information on what? The voice mumbles. I listened a half-dozen times: It sounded like "E-did-ity." Turned out to be "EBT" -- a reference to Electronic Benefit Transfer cards used to deliver food stamp benefits. But many people don't know what an EBT is. The state has called these the Lone Star Card. Why not use that name?
I gleaned the number for the commission's ombudsman, to whom clients can make formal complaints about poor service, from a voice prompt on one of the HHS customer-service lines. When I called, I was left on hold for close to an hour (with smooth jazz) before I gave up. An automated voice kept interrupting the jazz to persuade me to call other numbers because the wait was so long. But those numbers sent me back to other lines on which I had no success.
One hot-line worker I spoke with said she didn't have a directory of phone numbers of other HHS offices. What do you do when you need a number? I asked. Her answer: "I do a Google search."
If you press a wrong number, a voice prompt says the following before disconnecting you: "I'm sorry. That is not a valid choice. Please call again. Goodbye." Arrgghh.
The phones aren't the only issue. In a few smaller offices, Goodman said, HHS staffers still use typewriters instead of computers. "We know that our current system is not easy for the consumer to use," Goodman said. "It's not easy for our workers, and it's costly for taxpayers. There are so many areas where we can use technology more effectively to support our work force and provide better customer service."
News researcher Stacy Garcia contributed to this report.
In the know
These are the phone numbers that clients of Health and Human Services are supposed to use for help and information. However, note that The Watchdog had problems with several of them.
HHS office at 7450 John T. White Road in Fort Worth: 817-446-5400.
Lone Star Card help desk: 1-800-777-7328.
Customer assistance hot line: 1-800-448-3927
HHS customer service: 1-888-834-7406
Ombudsman: 1-877-787-8999
HHS main headquarters in Austin: 512-424-6500
For information about various social services available in your community, call 211
Facts about food stamps
Who is eligible? Food stamp assistance is available only to people with Social Security numbers.
Is there a work requirement? With certain exceptions, able-bodied adults between ages 16 and 60 must register for work, take part in any employment and training program that they are referred to by the food stamp department, and accept any offer of suitable work.
How long can you get food stamps? Generally, able-bodied adults ages 18 to 50 who do not have children and are not pregnant can get food stamps for only three months in a three-year period unless they are working or participating in a work or workfare program.
How many needy Texans are helped? In October 2007, there were 2.3 million Texans (in 912,102 households) receiving food stamps. Texas places 41st among 50 states in the percentage of eligible people receiving food stamps, well below the national average of 54 percent, according to the U.S. Agriculture Department.
How much are the benefits? Benefits are about $59 a week for the average household of 2.5 people, the state says. That's about $1.12 per person per meal.
What can they be used for? Benefits cannot be used to buy nonfood items such as pet food, soap, paper products, household supplies, alcohol, tobacco, vitamins, medicine or hot foods.
Sources: U.S. Agriculture Department, the Brookings Institution, Texas Health and Human Services Commission
watchdog@star-telegram.com
The Watchdog column appears Tuesdays, Fridays and Sundays in the Fort Worth Star Telegram.
Pat Dapeer said that if The Watchdog didn't believe what she was saying, he should try for himself.
Make phone calls to the state offices that handle the food stamp program. See if anyone answers the telephone. She almost dared me.
The 66-year-old disabled Watauga woman says it's a tossup which is worse: going hungry or dealing with the food stamp bureaucracy.
Let me summarize how my telephone testing of the Texas Health and Human Services Commission offices went.
Ring ... ring ... ring. No answering machine of any kind on calls to a local food stamp office. Just ring ... ring ... ring.
On some other phone lines I tested, an automated voice machine answered the phone and led me through prompts. But the voice system doesn't let you go backward. If you hit a wrong button, it tells you to call again before saying, "Goodbye." On another customer-assistance line, I called a half-dozen times to hear all the choices, which usually led me to more automated voice systems or the dreaded ring ... ring ... ring.
Twice, I found human beings on the other end of an HHS phone. But these people I spoke to from HHS didn't argue when I told them of Dapeer's frustrations. They know.
"A huge problem," HHS spokeswoman Stephanie Goodman said. "For years, we had high caseloads and antiquated technology and phone systems in our offices. We've been trying to undergo an effort to modernize."
The ringing phones are fallout from a major experiment in state government that nearly everyone involved calls a disaster. Texas tried to become the first state to outsource to private companies the administration of its top assistance programs such as food stamps, Medicaid and cash assistance for needy families.
The state hired a group of companies, led by technology consulting firm Accenture, for $899 million for five years to run call centers, update the department's technology systems and perform other duties. But the company's debut in several Central Texas call centers was such a disaster that state officials called the project off. By then, though, many longtime state employees had left, thinking their jobs were gone.
The results are skimpy front lines of state workers helping those needing assistance. Those who need to call these phone numbers for assistance include applicants who are denied benefits and wish to appeal, disabled people who can't travel and people like Dapeer who have questions about existing benefits.
Governing magazine published a September report on "The Struggle to Streamline" that said Texas' venture into privatization "turned into a dark comedy of bungled work; unanswered and dropped calls; applications lost, ignored and misdirected."
Dapeer said: "Just because we're on food stamps is no reason for us to put up with that type of service. We lose our pride when we have to do that to begin with, and when we have to go through the other garbage we have to deal with, well, that just puts us lower on the totem pole."
When Dapeer couldn't get anywhere with HHS officials in solving the problem with her benefits, she complained to the Texas attorney general's office.
Suddenly, HHS officials were answering her calls and trying to work with her.
"A person shouldn't have to go to the attorney general to get something done," she said.
HHS spokeswoman Goodman says that changes are in the works. New telephone systems are coming for 22 of more than 300 field offices. Most of the 22 are in urban areas, where phones are less likely to be answered. The Fort Worth office on John T. White Road is scheduled for new phones, she says. Other offices will have to wait.
The Watchdog's testing of the phone system yielded a few results that should embarrass the state:
The operator's phone at the John T. White Road office in Fort Worth was never picked up.
A voice on an automated phone system directs callers to a different phone number if they want information. But information on what? The voice mumbles. I listened a half-dozen times: It sounded like "E-did-ity." Turned out to be "EBT" -- a reference to Electronic Benefit Transfer cards used to deliver food stamp benefits. But many people don't know what an EBT is. The state has called these the Lone Star Card. Why not use that name?
I gleaned the number for the commission's ombudsman, to whom clients can make formal complaints about poor service, from a voice prompt on one of the HHS customer-service lines. When I called, I was left on hold for close to an hour (with smooth jazz) before I gave up. An automated voice kept interrupting the jazz to persuade me to call other numbers because the wait was so long. But those numbers sent me back to other lines on which I had no success.
One hot-line worker I spoke with said she didn't have a directory of phone numbers of other HHS offices. What do you do when you need a number? I asked. Her answer: "I do a Google search."
If you press a wrong number, a voice prompt says the following before disconnecting you: "I'm sorry. That is not a valid choice. Please call again. Goodbye." Arrgghh.
The phones aren't the only issue. In a few smaller offices, Goodman said, HHS staffers still use typewriters instead of computers. "We know that our current system is not easy for the consumer to use," Goodman said. "It's not easy for our workers, and it's costly for taxpayers. There are so many areas where we can use technology more effectively to support our work force and provide better customer service."
News researcher Stacy Garcia contributed to this report.
In the know
These are the phone numbers that clients of Health and Human Services are supposed to use for help and information. However, note that The Watchdog had problems with several of them.
HHS office at 7450 John T. White Road in Fort Worth: 817-446-5400.
Lone Star Card help desk: 1-800-777-7328.
Customer assistance hot line: 1-800-448-3927
HHS customer service: 1-888-834-7406
Ombudsman: 1-877-787-8999
HHS main headquarters in Austin: 512-424-6500
For information about various social services available in your community, call 211
Facts about food stamps
Who is eligible? Food stamp assistance is available only to people with Social Security numbers.
Is there a work requirement? With certain exceptions, able-bodied adults between ages 16 and 60 must register for work, take part in any employment and training program that they are referred to by the food stamp department, and accept any offer of suitable work.
How long can you get food stamps? Generally, able-bodied adults ages 18 to 50 who do not have children and are not pregnant can get food stamps for only three months in a three-year period unless they are working or participating in a work or workfare program.
How many needy Texans are helped? In October 2007, there were 2.3 million Texans (in 912,102 households) receiving food stamps. Texas places 41st among 50 states in the percentage of eligible people receiving food stamps, well below the national average of 54 percent, according to the U.S. Agriculture Department.
How much are the benefits? Benefits are about $59 a week for the average household of 2.5 people, the state says. That's about $1.12 per person per meal.
What can they be used for? Benefits cannot be used to buy nonfood items such as pet food, soap, paper products, household supplies, alcohol, tobacco, vitamins, medicine or hot foods.
Sources: U.S. Agriculture Department, the Brookings Institution, Texas Health and Human Services Commission
watchdog@star-telegram.com
The Watchdog column appears Tuesdays, Fridays and Sundays in the Fort Worth Star Telegram.
Lawmakers seeking stricter caregiver rules
By DARREN BARBEE - Star-Telegram staff writer - Oct. 14, 2007
Nurse aides let back into jobs despite ban
A state senator says she wants to improve the background screening of nurse aides and other caregivers after gaps that allow criminals to work in nursing homes were identified in a recent Star-Telegram report.
Advocates for nursing home residents and the industry also expressed concern that some workers banned by the Texas Department of Aging and Disability Services for abuse, neglect and theft have been certified as nurse aides by the same department. Some found new jobs caring for the elderly and disabled. Sen. Judith Zaffirini, D-Laredo, said she was troubled to learn that crimes barring employment in nursing homes, such as murder and rape, don't prevent aides from being recertified. Aides and other such workers give the vast majority of care at nursing homes and also work at doctors' offices and hospitals.
Zaffirini, who created key legislation in 1999 designed to bar abusive but unlicensed workers from nursing homes, said her staff is drafting legislation to prevent criminals from being certified. She also wants to deal with workers banned for abuse who are recertified.
"We believed they were being barred from being recertified as a nurse aide. ... That's an aspect of the problem that [the newspaper] pointed out, and we have to go back and address," said Zaffirini, a member and former chairwoman of the state Senate Committee on Health and Human Services.
The senator said she is also considering a bill that would require workers to be rescreened annually. Currently, homes check criminal history just once, before workers or aides are hired. That can allow subsequent convictions to go undetected. For instance, a McAllen aide passed his pre-employment check but later pleaded guilty to indecent exposure. His employers uncovered the conviction only after he was accused of molesting a nursing home resident. The aide denied doing anything wrong, according to state documents.
Tim Graves, president of the Texas Health Care Association, said he supports a periodic recheck of employees' criminal histories. But such checks could financially burden homes, which often operate on tight budgets. Texas ranks 45th out of the 50 states in Medicaid funding for nursing home care, according to the association, which represents long-term-care facilities and professionals.
Graves said the newspaper report also showed problems in the oversight of long-term-care workers. In one case, a worker was banned for failing to perform CPR on a resident who later died. The state recertified her as a nurse aide, and she found another job. She was fired only after the Star-Telegram asked a Plano home about her status.
Sen. Jane Nelson, R-Lewisville, had asked officials to review policies on criminal-background checks across health and human services agencies, her spokesman said. Nelson, leader of the Health and Human Services committee, was unavailable for an interview.
Nelson said in a statement that nurse aides with serious criminal records should not have access to the frail and elderly. In the past session, Nelson authored a bill that added new criminal offenses, such as indecent exposure and cruelty to animals, to those that bar long-term-care workers from employment in state-regulated facilities. But workers won't be rescreened for the new convictions, the department said.
Checking out workers
The Texas Department of Aging and Disability Services provides an online database that allows a search for workers, nurse aides, administrators and others who have been designated as unemployable. Because Texas has more than 118,000 active certified nurse aides, verifying the status of a nurse aide or worker, especially one with a common name, can be difficult without a Social Security number. If you suspect an aide shouldn't be working, bring concerns to the attention of the nursing home or the department at 1-800-458-9858. To perform a search, go to www.dads.state.tx.us/providers/nf/credentialing/sanctions
Checking out nursing homes
The department also maintains basic inspection information about nursing homes online. Additionally, nursing homes must make their most recent inspection reports public. The surveyor's notes can sometimes provide insight into how well residents are treated and how clean things are kept. To look up a home, go to facilityquality.dads.state.tx.us
Read more in the Fort Worth Star Telegram.
Nurse aides let back into jobs despite ban
A state senator says she wants to improve the background screening of nurse aides and other caregivers after gaps that allow criminals to work in nursing homes were identified in a recent Star-Telegram report.
Advocates for nursing home residents and the industry also expressed concern that some workers banned by the Texas Department of Aging and Disability Services for abuse, neglect and theft have been certified as nurse aides by the same department. Some found new jobs caring for the elderly and disabled. Sen. Judith Zaffirini, D-Laredo, said she was troubled to learn that crimes barring employment in nursing homes, such as murder and rape, don't prevent aides from being recertified. Aides and other such workers give the vast majority of care at nursing homes and also work at doctors' offices and hospitals.
Zaffirini, who created key legislation in 1999 designed to bar abusive but unlicensed workers from nursing homes, said her staff is drafting legislation to prevent criminals from being certified. She also wants to deal with workers banned for abuse who are recertified.
"We believed they were being barred from being recertified as a nurse aide. ... That's an aspect of the problem that [the newspaper] pointed out, and we have to go back and address," said Zaffirini, a member and former chairwoman of the state Senate Committee on Health and Human Services.
The senator said she is also considering a bill that would require workers to be rescreened annually. Currently, homes check criminal history just once, before workers or aides are hired. That can allow subsequent convictions to go undetected. For instance, a McAllen aide passed his pre-employment check but later pleaded guilty to indecent exposure. His employers uncovered the conviction only after he was accused of molesting a nursing home resident. The aide denied doing anything wrong, according to state documents.
Tim Graves, president of the Texas Health Care Association, said he supports a periodic recheck of employees' criminal histories. But such checks could financially burden homes, which often operate on tight budgets. Texas ranks 45th out of the 50 states in Medicaid funding for nursing home care, according to the association, which represents long-term-care facilities and professionals.
Graves said the newspaper report also showed problems in the oversight of long-term-care workers. In one case, a worker was banned for failing to perform CPR on a resident who later died. The state recertified her as a nurse aide, and she found another job. She was fired only after the Star-Telegram asked a Plano home about her status.
Sen. Jane Nelson, R-Lewisville, had asked officials to review policies on criminal-background checks across health and human services agencies, her spokesman said. Nelson, leader of the Health and Human Services committee, was unavailable for an interview.
Nelson said in a statement that nurse aides with serious criminal records should not have access to the frail and elderly. In the past session, Nelson authored a bill that added new criminal offenses, such as indecent exposure and cruelty to animals, to those that bar long-term-care workers from employment in state-regulated facilities. But workers won't be rescreened for the new convictions, the department said.
Checking out workers
The Texas Department of Aging and Disability Services provides an online database that allows a search for workers, nurse aides, administrators and others who have been designated as unemployable. Because Texas has more than 118,000 active certified nurse aides, verifying the status of a nurse aide or worker, especially one with a common name, can be difficult without a Social Security number. If you suspect an aide shouldn't be working, bring concerns to the attention of the nursing home or the department at 1-800-458-9858. To perform a search, go to www.dads.state.tx.us/providers/nf/credentialing/sanctions
Checking out nursing homes
The department also maintains basic inspection information about nursing homes online. Additionally, nursing homes must make their most recent inspection reports public. The surveyor's notes can sometimes provide insight into how well residents are treated and how clean things are kept. To look up a home, go to facilityquality.dads.state.tx.us
Read more in the Fort Worth Star Telegram.
Wednesday, August 29, 2007
Shorter Waits for Botox Than Examinations of Moles
By NATASHA SINGER The New York Times - August 29, 2007
Patients seeking an appointment with a dermatologist to ask about a potentially cancerous mole have to wait substantially longer than those seeking Botox for wrinkles, says a study published online today by The Journal of the American Academy of Dermatology.
Researchers reported that dermatologists in 12 cities offered a typical wait of eight days for a cosmetic patient wanting Botox to smooth wrinkles, compared to a typical wait of 26 days for a patient requesting evaluation of a changing mole, a possible indicator of skin cancer.
“The difference in wait times between medical dermatology and cosmetic dermatology patients is clearly real,” said Dr. Jack S. Resneck Jr., the lead author of the study and an assistant dermatology professor at the medical school of the University of California, San Francisco. “We need to look further and figure out what is leading to shorter wait times for cosmetic patients.”
In Boston, the median Botox wait was 13 days, versus 68 days for a mole examination. In Seattle, the median Botox wait was seven and a half days, compared to 35 days for a changing mole.
The study, in which a researcher posing as a patient called every board-certified dermatologist in the 12 cities, including Miami, Cleveland and Lansing, Mich., did not examine the possible causes for the varying times.
Dr. David M. Pariser, president-elect of the American Academy of Dermatology, said it seemed clear that cosmetic patients in the studied cities had faster access to dermatologists than medical patients.
“It doesn’t make me proud to say it, but it is true,” Dr. Pariser, a dermatologist in Norfolk, Va., said.
Dr. Alexa B. Kimball, an associate professor of dermatology at the Harvard Medical School said a simple explanation might be that the demand for medical dermatologists outstrips the supply.
At a time of increased awareness about skin diseases like melanoma and psoriasis, more people seek medical appointments with dermatologists, Dr. Kimball said. Meanwhile, a wider array of doctors like plastic surgeons and even some internists offer Botox shots, she said.
“The study shows that the Botox needs of the United States are being met,” said Dr. Kimball, who has conducted studies showing that dermatologists nationwide spent an average of three to four hours a week on cosmetic treatments. “If dermatologists stopped providing cosmetic care, it would not necessarily have an impact on medical dermatology patients.”
Other dermatologists said financial incentives to perform cosmetic treatments coupled with bureaucratic obstacles in obtaining insurance reimbursement for medical treatments might also have a role in the varying wait times.
Dr. Michael J. Franzblau, a dermatologist in San Francisco, said doctors typically charged $400 to $600 for a Botox antiwrinkle treatment, for which patients pay upfront because insurance does not cover it.
Meanwhile, doctors have to wait for health insurance to reimburse them for mole examinations, for which they receive an average of $50 to $75, Dr. Franzblau said.
Dr. Resneck, the lead author of the study, said dermatologists should better monitor how their patients are scheduled.
“The office may have been trained to respond to Botox patients who expect to get in and get out quickly,” Dr. Resneck said. “But the staff may not be effective in finding the patients with worrisome conditions and getting them to the head of the queue.”
Read more
Patients seeking an appointment with a dermatologist to ask about a potentially cancerous mole have to wait substantially longer than those seeking Botox for wrinkles, says a study published online today by The Journal of the American Academy of Dermatology.
Researchers reported that dermatologists in 12 cities offered a typical wait of eight days for a cosmetic patient wanting Botox to smooth wrinkles, compared to a typical wait of 26 days for a patient requesting evaluation of a changing mole, a possible indicator of skin cancer.
“The difference in wait times between medical dermatology and cosmetic dermatology patients is clearly real,” said Dr. Jack S. Resneck Jr., the lead author of the study and an assistant dermatology professor at the medical school of the University of California, San Francisco. “We need to look further and figure out what is leading to shorter wait times for cosmetic patients.”
In Boston, the median Botox wait was 13 days, versus 68 days for a mole examination. In Seattle, the median Botox wait was seven and a half days, compared to 35 days for a changing mole.
The study, in which a researcher posing as a patient called every board-certified dermatologist in the 12 cities, including Miami, Cleveland and Lansing, Mich., did not examine the possible causes for the varying times.
Dr. David M. Pariser, president-elect of the American Academy of Dermatology, said it seemed clear that cosmetic patients in the studied cities had faster access to dermatologists than medical patients.
“It doesn’t make me proud to say it, but it is true,” Dr. Pariser, a dermatologist in Norfolk, Va., said.
Dr. Alexa B. Kimball, an associate professor of dermatology at the Harvard Medical School said a simple explanation might be that the demand for medical dermatologists outstrips the supply.
At a time of increased awareness about skin diseases like melanoma and psoriasis, more people seek medical appointments with dermatologists, Dr. Kimball said. Meanwhile, a wider array of doctors like plastic surgeons and even some internists offer Botox shots, she said.
“The study shows that the Botox needs of the United States are being met,” said Dr. Kimball, who has conducted studies showing that dermatologists nationwide spent an average of three to four hours a week on cosmetic treatments. “If dermatologists stopped providing cosmetic care, it would not necessarily have an impact on medical dermatology patients.”
Other dermatologists said financial incentives to perform cosmetic treatments coupled with bureaucratic obstacles in obtaining insurance reimbursement for medical treatments might also have a role in the varying wait times.
Dr. Michael J. Franzblau, a dermatologist in San Francisco, said doctors typically charged $400 to $600 for a Botox antiwrinkle treatment, for which patients pay upfront because insurance does not cover it.
Meanwhile, doctors have to wait for health insurance to reimburse them for mole examinations, for which they receive an average of $50 to $75, Dr. Franzblau said.
Dr. Resneck, the lead author of the study, said dermatologists should better monitor how their patients are scheduled.
“The office may have been trained to respond to Botox patients who expect to get in and get out quickly,” Dr. Resneck said. “But the staff may not be effective in finding the patients with worrisome conditions and getting them to the head of the queue.”
Read more
Poverty Rate Falls, but More Are Uninsured - Texas has highest rate of uninsured
By ABBY GOODNOUGH - The New York Times - August 28, 2007
The nation’s poverty rate fell in 2006 for the first time this decade, the Census Bureau reported today, even as the percentage of Americans without health insurance coverage hit a record high.
The results were not consistent across racial or age groups. For Hispanics, the poverty rate fell by 1.2 percentage points to 20.6 percent, while for whites, blacks and Asians, it remained statistically unchanged.
For elderly people, the poverty rate was among the lowest since 1959, when the government began collecting such data.
Median household income rose slightly for the second consecutive year, by seven-tenths of a percent, but the only statistically significant increase was in white households. It was the first real increase for white households since 1999.
Overall, the nation’s median household income rose to $48,201 in 2006, from $47,845 in 2005. It was the second consecutive year in which income rose slightly faster than inflation, after six years of decline.
“Even though overall it has not recovered to its 1999 pre-recessionary peak,” said David Johnson, chief of the housing and household economic statistics division for the Census Bureau, “the gap is narrowing.”
The slight improvements in household income and the poverty rate came even as the nation’s housing market started its steep decline and hurt employment in some states. But overall, it was a year of slow improvement in the job market and declining inflation.
The West was the only region of the country to experience a drop in the number and percentage of people in poverty. The South continued to have the highest poverty rate, at 13.8 percent, compared with 12.3 percent nationally, and the lowest median household income, $43,884.
Among large cities, Plano, Tex., had the highest median household income in 2006, while Cleveland, Miami, Buffalo and Detroit had the lowest. Among smaller cities, Youngstown, Ohio, and Syracuse had among the lowest incomes.
Census officials attributed the rise in uninsured Americans to 47 million from 44.8 million in 2005 mostly to Americans losing employer-provided or privately purchased health insurance. The percentage of people who received health benefits through an employer declined to 59.7 percent in 2006 from 60.2 percent in 2005.
The percentage of people with government-provided health insurance also dropped, to 27 percent from 27.3 percent.
The number of uninsured children increased to 8.7 million, or 11.7 percent, in 2006, from 8 million, or 10.9 percent, in 2006.
Texas had the highest percentage of uninsured residents in 2006 with 24.1 percent, while Minnesota had the lowest at 8.5 percent.
Mr. Johnson warned that even as median household incomes climbed slightly last year, both men and women brought home less pay for the third consecutive year. The household income growth was a reflection of more family members taking jobs to make ends meet, he said, and of some people earning more from sources other than wages, like investments.
Just over half of household income was concentrated in the fifth of the population with top income 2006, about the same as in 2005. Households in the lowest income quintile, on the other hand, accounted for only 3.4 percent of the nation’s household income.
Read more
OPINION = EDITORIAL;
A Sobering Census Report: Bleak Findings on Health Insurance
New York Times - Aug. 29, 2007
Read more
The nation’s poverty rate fell in 2006 for the first time this decade, the Census Bureau reported today, even as the percentage of Americans without health insurance coverage hit a record high.
The results were not consistent across racial or age groups. For Hispanics, the poverty rate fell by 1.2 percentage points to 20.6 percent, while for whites, blacks and Asians, it remained statistically unchanged.
For elderly people, the poverty rate was among the lowest since 1959, when the government began collecting such data.
Median household income rose slightly for the second consecutive year, by seven-tenths of a percent, but the only statistically significant increase was in white households. It was the first real increase for white households since 1999.
Overall, the nation’s median household income rose to $48,201 in 2006, from $47,845 in 2005. It was the second consecutive year in which income rose slightly faster than inflation, after six years of decline.
“Even though overall it has not recovered to its 1999 pre-recessionary peak,” said David Johnson, chief of the housing and household economic statistics division for the Census Bureau, “the gap is narrowing.”
The slight improvements in household income and the poverty rate came even as the nation’s housing market started its steep decline and hurt employment in some states. But overall, it was a year of slow improvement in the job market and declining inflation.
The West was the only region of the country to experience a drop in the number and percentage of people in poverty. The South continued to have the highest poverty rate, at 13.8 percent, compared with 12.3 percent nationally, and the lowest median household income, $43,884.
Among large cities, Plano, Tex., had the highest median household income in 2006, while Cleveland, Miami, Buffalo and Detroit had the lowest. Among smaller cities, Youngstown, Ohio, and Syracuse had among the lowest incomes.
Census officials attributed the rise in uninsured Americans to 47 million from 44.8 million in 2005 mostly to Americans losing employer-provided or privately purchased health insurance. The percentage of people who received health benefits through an employer declined to 59.7 percent in 2006 from 60.2 percent in 2005.
The percentage of people with government-provided health insurance also dropped, to 27 percent from 27.3 percent.
The number of uninsured children increased to 8.7 million, or 11.7 percent, in 2006, from 8 million, or 10.9 percent, in 2006.
Texas had the highest percentage of uninsured residents in 2006 with 24.1 percent, while Minnesota had the lowest at 8.5 percent.
Mr. Johnson warned that even as median household incomes climbed slightly last year, both men and women brought home less pay for the third consecutive year. The household income growth was a reflection of more family members taking jobs to make ends meet, he said, and of some people earning more from sources other than wages, like investments.
Just over half of household income was concentrated in the fifth of the population with top income 2006, about the same as in 2005. Households in the lowest income quintile, on the other hand, accounted for only 3.4 percent of the nation’s household income.
Read more
OPINION = EDITORIAL;
A Sobering Census Report: Bleak Findings on Health Insurance
New York Times - Aug. 29, 2007
The Census Bureau’s report on the state of American health insurance was as disturbing as its statistics on poverty and income. The bureau reported a large increase in the number of Americans who lack health insurance, data that ought to send an unmistakable message to Washington: vigorous action is needed to reverse this alarming and intractable trend.
The number of uninsured Americans has been rising inexorably over the past six years as soaring health care costs have driven up premiums, employers have scaled back or eliminated health benefits and hard-pressed families have found themselves unable to purchase insurance at a reasonable price. Last year, the number of uninsured Americans increased by a daunting 2.2 million, from 44.8 million in 2005 to 47.0 million in 2006. That scotched any hope that the faltering economic recovery would help alleviate the problem.
The main reason for the upsurge in uninsured Americans is that employment-based coverage continued to deteriorate. Indeed, the number of full-time workers without health insurance rose from 20.8 million in 2005 to 22.0 million in 2006, presumably because either the employers or the workers or both found it too costly.
Sadly, the one area where the nation had made progress — reducing the number of uninsured children — took a turn for the worse. The number of uninsured children under 18 dropped steadily and significantly from 1999 to 2004, thanks largely to an expansion in coverage of low-income children under two programs operated jointly by the states and the federal government, Medicaid and the State Children’s Health Insurance Program. Then last year the number of uninsured children jumped more than 600,000 to reach 8.6 million. The main reason, advocacy groups say, is that access and funding for the low-income programs became tighter while employer coverage for dependents eroded.
The challenge to the White House and Congress seems clear. The upward trend in the number of uninsured needs to be reversed because many studies have shown that people who lack health insurance tend to forgo needed care until they become much sicker and go to expensive emergency rooms for treatment. That harms their health and drives up everyone’s health care costs.
The most immediate need is to reauthorize and expand the expiring State Children’s Health Insurance Program. It has already brought health coverage to millions of young Americans. It should be reinvigorated to bring coverage to many millions more.
Read more
Sunday, August 26, 2007
Rules May Limit Health Program Aiding Children
By ROBERT PEAR - The New York Times - August 21, 2007
The Bush administration, continuing its fight to stop states from expanding the popular Children’s Health Insurance Program, has adopted new standards that would make it much more difficult for New York, California and others to extend coverage to children in middle-income families.
Administration officials outlined the new standards in a letter sent to state health officials on Friday evening, in the middle of a monthlong Congressional recess. In interviews, they said the changes were intended to return the Children’s Health Insurance Program to its original focus on low-income children and to make sure the program did not become a substitute for private health coverage.
After learning of the new policy, some state officials said yesterday that it could cripple their efforts to cover more children and would impose standards that could not be met.
“We are horrified at the new federal policy,” said Ann Clemency Kohler, deputy commissioner of human services in New Jersey. “It will cause havoc with our program and could jeopardize coverage for thousands of children.”
Stan Rosenstein, the Medicaid director in California, said the new policy was “highly restrictive, much more restrictive than what we want to do.”
The poverty level for a family of four is set by the federal government at $20,650 in annual income. Many states have received federal permission to cover children with family incomes exceeding twice the poverty level — $41,300 for a family of four. In New York, which covers children up to 250 percent of the poverty level, the Legislature has passed a bill that would raise the limit to 400 percent— $82,600 for a family of four — but the change is subject to federal approval.
California wants to increase its income limit to 300 percent of the poverty level, from 250 percent. Pennsylvania recently raised its limit to 300 percent, from 200 percent. New Jersey has had a limit of 350 percent for more than five years.
As with issues like immigration, the White House is taking action on its own to advance policies that have not been embraced by Congress.
In his budget in February, President Bush proposed strict limits on family income for the child health program. Both houses of Congress voted this month to renew the program for five years, but neither chamber accepted that proposal. Legal authority for the program expires on Sept. 30.
The administration’s new policy is explained in a letter that was sent about 7:30 p.m. on Friday to state health officials from Dennis G. Smith, the director of the federal Center for Medicaid and State Operations. The policy would continue indefinitely, though Democrats in Congress could try to override it.
The Children’s Health Insurance Program has strong support from governors of both parties, including Republicans like Arnold Schwarzenegger of California, Tim Pawlenty of Minnesota and Sonny Perdue of Georgia. When the Senate passed a bill to expand the program this month, 18 Republican senators voted for it, in defiance of a veto threat from Mr. Bush. The House passed a more expansive bill and will try to work out differences with the Senate when Congress reconvenes next month.
In his letter, Mr. Smith set a high standard for states that want to raise eligibility for the child health program above 250 percent of the poverty level.
Before making such a change, Mr. Smith wrote, states must demonstrate that they have “enrolled at least 95 percent of children in the state below 200 percent of the federal poverty level” who are eligible for either Medicaid or the child health program.
Deborah S. Bachrach, a deputy commissioner in the New York State Health Department, said, “No state in the nation has a participation rate of 95 percent.”
And Cindy Mann, a research professor at the Health Policy Institute of Georgetown University, said, “No state would ever achieve that level of participation under the president’s budget proposals.”
The Congressional Budget Office has said that the president’s budget, which seeks $30 billion for the program from 2008 to 2012, is not enough to pay for current levels of enrollment, much less to cover children who are eligible but not enrolled.
When Congress created the Children’s Health Insurance Program in 1997, it said the purpose was to cover “uninsured low-income children.” Under the law, states are supposed to make sure public coverage “does not substitute for coverage under group health plans.”
In an interview yesterday, Mr. Smith said, “The program was always meant for children in lower-income families.” As a state increases its income limits, he said, “it’s more likely to substitute for private coverage.”
To minimize the risk of such substitution, Mr. Smith said in his letter, states should charge co-payments or premiums that approximate the cost of private coverage and should impose “waiting periods” to make sure middle-income children do not go directly from a private health plan to a public program.
If a state wants to set its income limit above 250 percent of the poverty level — $51,625 for a family of four — Mr. Smith said, “the state must establish a minimum of a one-year period of uninsurance for individuals” before they can receive public coverage.
That is considerably stricter than past requirements. In February, for example, the Bush administration allowed Pennsylvania to increase its income limit to 300 percent of the poverty level after the state agreed to a six-month waiting period for children who were 2 and older with family incomes exceeding 200 percent of the poverty level.
As another precaution, Mr. Smith said, states that want to cover children above 250 percent of the poverty level must show that “the number of children in the target population insured through private employers has not decreased by more than two percentage points over the prior five-year period.”
In New Jersey, which has a three-month waiting period, Ms. Kohler said, “we have no evidence of a decline in employer-sponsored coverage resulting from the Children’s Health Insurance Program.”
In the Senate debate this month, several Republicans offered a proposal similar to the new Bush administration policy. They wanted to require states to cover 95 percent of low-income children before allowing states to expand eligibility.
Senator Max Baucus, the Montana Democrat who is chairman of the Finance Committee, argued against the proposal, saying: “No state can meet 95 percent. No state currently meets 95 percent.”
In his letter, Mr. Smith said the new standards would apply to states that previously received federal approval to cover children with family incomes over 250 percent of the poverty level. Such states should amend their state plans to meet federal expectations within 12 months, or the Bush administration “may pursue corrective action,” Mr. Smith said.
Two Republican senators, Charles E. Grassley of Iowa and Pat Roberts of Kansas, urged the Bush administration last week to deny New York’s request to cover children with family incomes up to four times the poverty level. The proposal, they said, violates the original intent of Congress.
But Gov. Eliot Spitzer of New York said that, “contrary to the senators’ objections,” federal law allows states to set higher income limits. “Granting this expansion,” Mr. Spitzer said, “is essential to the health and well-being of New York’s children.”
Read more in The New York Times
The Bush administration, continuing its fight to stop states from expanding the popular Children’s Health Insurance Program, has adopted new standards that would make it much more difficult for New York, California and others to extend coverage to children in middle-income families.
Administration officials outlined the new standards in a letter sent to state health officials on Friday evening, in the middle of a monthlong Congressional recess. In interviews, they said the changes were intended to return the Children’s Health Insurance Program to its original focus on low-income children and to make sure the program did not become a substitute for private health coverage.
After learning of the new policy, some state officials said yesterday that it could cripple their efforts to cover more children and would impose standards that could not be met.
“We are horrified at the new federal policy,” said Ann Clemency Kohler, deputy commissioner of human services in New Jersey. “It will cause havoc with our program and could jeopardize coverage for thousands of children.”
Stan Rosenstein, the Medicaid director in California, said the new policy was “highly restrictive, much more restrictive than what we want to do.”
The poverty level for a family of four is set by the federal government at $20,650 in annual income. Many states have received federal permission to cover children with family incomes exceeding twice the poverty level — $41,300 for a family of four. In New York, which covers children up to 250 percent of the poverty level, the Legislature has passed a bill that would raise the limit to 400 percent— $82,600 for a family of four — but the change is subject to federal approval.
California wants to increase its income limit to 300 percent of the poverty level, from 250 percent. Pennsylvania recently raised its limit to 300 percent, from 200 percent. New Jersey has had a limit of 350 percent for more than five years.
As with issues like immigration, the White House is taking action on its own to advance policies that have not been embraced by Congress.
In his budget in February, President Bush proposed strict limits on family income for the child health program. Both houses of Congress voted this month to renew the program for five years, but neither chamber accepted that proposal. Legal authority for the program expires on Sept. 30.
The administration’s new policy is explained in a letter that was sent about 7:30 p.m. on Friday to state health officials from Dennis G. Smith, the director of the federal Center for Medicaid and State Operations. The policy would continue indefinitely, though Democrats in Congress could try to override it.
The Children’s Health Insurance Program has strong support from governors of both parties, including Republicans like Arnold Schwarzenegger of California, Tim Pawlenty of Minnesota and Sonny Perdue of Georgia. When the Senate passed a bill to expand the program this month, 18 Republican senators voted for it, in defiance of a veto threat from Mr. Bush. The House passed a more expansive bill and will try to work out differences with the Senate when Congress reconvenes next month.
In his letter, Mr. Smith set a high standard for states that want to raise eligibility for the child health program above 250 percent of the poverty level.
Before making such a change, Mr. Smith wrote, states must demonstrate that they have “enrolled at least 95 percent of children in the state below 200 percent of the federal poverty level” who are eligible for either Medicaid or the child health program.
Deborah S. Bachrach, a deputy commissioner in the New York State Health Department, said, “No state in the nation has a participation rate of 95 percent.”
And Cindy Mann, a research professor at the Health Policy Institute of Georgetown University, said, “No state would ever achieve that level of participation under the president’s budget proposals.”
The Congressional Budget Office has said that the president’s budget, which seeks $30 billion for the program from 2008 to 2012, is not enough to pay for current levels of enrollment, much less to cover children who are eligible but not enrolled.
When Congress created the Children’s Health Insurance Program in 1997, it said the purpose was to cover “uninsured low-income children.” Under the law, states are supposed to make sure public coverage “does not substitute for coverage under group health plans.”
In an interview yesterday, Mr. Smith said, “The program was always meant for children in lower-income families.” As a state increases its income limits, he said, “it’s more likely to substitute for private coverage.”
To minimize the risk of such substitution, Mr. Smith said in his letter, states should charge co-payments or premiums that approximate the cost of private coverage and should impose “waiting periods” to make sure middle-income children do not go directly from a private health plan to a public program.
If a state wants to set its income limit above 250 percent of the poverty level — $51,625 for a family of four — Mr. Smith said, “the state must establish a minimum of a one-year period of uninsurance for individuals” before they can receive public coverage.
That is considerably stricter than past requirements. In February, for example, the Bush administration allowed Pennsylvania to increase its income limit to 300 percent of the poverty level after the state agreed to a six-month waiting period for children who were 2 and older with family incomes exceeding 200 percent of the poverty level.
As another precaution, Mr. Smith said, states that want to cover children above 250 percent of the poverty level must show that “the number of children in the target population insured through private employers has not decreased by more than two percentage points over the prior five-year period.”
In New Jersey, which has a three-month waiting period, Ms. Kohler said, “we have no evidence of a decline in employer-sponsored coverage resulting from the Children’s Health Insurance Program.”
In the Senate debate this month, several Republicans offered a proposal similar to the new Bush administration policy. They wanted to require states to cover 95 percent of low-income children before allowing states to expand eligibility.
Senator Max Baucus, the Montana Democrat who is chairman of the Finance Committee, argued against the proposal, saying: “No state can meet 95 percent. No state currently meets 95 percent.”
In his letter, Mr. Smith said the new standards would apply to states that previously received federal approval to cover children with family incomes over 250 percent of the poverty level. Such states should amend their state plans to meet federal expectations within 12 months, or the Bush administration “may pursue corrective action,” Mr. Smith said.
Two Republican senators, Charles E. Grassley of Iowa and Pat Roberts of Kansas, urged the Bush administration last week to deny New York’s request to cover children with family incomes up to four times the poverty level. The proposal, they said, violates the original intent of Congress.
But Gov. Eliot Spitzer of New York said that, “contrary to the senators’ objections,” federal law allows states to set higher income limits. “Granting this expansion,” Mr. Spitzer said, “is essential to the health and well-being of New York’s children.”
Read more in The New York Times
Saturday, August 25, 2007
Dentists' discipline hidden from view - The agency is struggling to protect the public, critics say
By DARREN BARBEE - Star-Telegram staff writer - Mon, Jun. 11, 2007
Second in a four-part series examining state regulation of health professionals
One dentist was accused of botching root canals, bridges and crowns and writing 100 prescriptions after his controlled-substances permit had expired.
Another dentist was sentenced to 27 months in prison for overbilling a government program to help the poor. Still another, from Euless, was shot in the chest while breaking into his in-laws' home. He received probation after pleading guilty to criminal trespass and assault charges.
The dentists all have at least two things in common: They're currently licensed to practice in Texas, and the Texas State Board of Dental Examiners only shares details about their past if a request is made in writing -- just don't expect a quick answer.
Some say the governor-appointed board has struggled in recent years to fulfill its basic mission: protecting the public.
Board member Tammy Allen, a Hurst dental hygienist, said the board does the best it can with the resources it has. But she is troubled by a sharp decline -- 58 percent over three years -- in the number of dental professionals disciplined. She's also concerned penalties are handed out too subjectively.
"Two dentists can have the same violation and one will get a warning and the other a $1,000 fine," Allen said. "That's not right, it's not fair, and as a board member, that bothers me."
The state has taken the board to task for such problems as failing to enforce its disciplinary actions and not meeting deadlines.
Consumer advocates are concerned that, while the board can give bad dentists and even those who are convicted criminals a second chance, its Web site merely states if a dentist has faced discipline and the type of penalty imposed. It offers little information about the nature of their offenses.
Supporters say the board in recent years has cleared a large backlog of complaints, some stretching back more than six years. During that time, disciplinary actions exceeded state-set benchmarks, although last year they were lagging.
Fread Houston, the board's general counsel, said the agency's penalty system has been overhauled in recent years to make it more evenhanded. More consistent results would come if the small agency with 29 budgeted employees had more funding, he said.
State reports show last fiscal year the board generated $4.5 million more than it spent. But that money, largely from fees related to licensing, credentialing and examinations, went to the state's general fund. The board spent $1.8 million.
Among other needs is an updated computer system.
"It's crazy," Houston said. "Literally, I look at the screen and it's as if you're in 1980."
Houston said the board is making progress.
"Can it be made better? Yes. I think there is room for improvement."
Backlog of complaints
The board's job is big: Each year it must screen the approximately 12,000 dentists and 10,000 hygienists it licenses, on top of investigating hundreds of complaints.
It has fallen short in both areas, according to the most recent state auditor's report on the board.
Houston said he doesn't agree with some conclusions reached in the August 2005 report, including the discovery that six convicted felons weren't investigated during the licensing process.
The board uses the Texas Department of Public Safety to conduct criminal background checks but relied on a report that showed only changes in criminal records during the prior four months, rather than a full criminal history as required by law.
The board responded by saying that it would work with the DPS to ensure it obtained full histories on all new licensees.
"It wasn't that we weren't doing our job," Houston said. "It was that the information we were getting back was just not complete."
The audit also found that sanctions imposed against dentists and hygienists weren't enforced. One dentist, for instance, was required to receive peer assistance for a substance-abuse problem. The day after the board was notified the dentist hadn't done so, its staff renewed his license.
In response, the board noted that it is not authorized to use the license-renewal process as a disciplinary tool.
In a separate report by the Legislative Budget Board, the board took hits for failing to investigate complaints on time. In 2005, for instance, it averaged about a year to resolve problems, about 80 days longer than the state benchmark. Last year, the board again averaged a year response time, but the state upped the deadline to 400 days.
Earlier this spring, the board faced a backlog of about 270 complaints, including a 2001 case.
The slow response to a backlog of complaints resulted from employees leaving for other agencies or the private sector, Houston said.
From June through December 2005, for instance, the executive director, director of enforcement, five investigators, an attorney and two administrative employees left the board. As a result, new employees were constantly being trained and were unfamiliar with the system. In the legislative session that just ended, the board was granted eight new positions it requested.
Thief's license reinstated
Greed got the best of Amarillo dentist Charles T. Carr.
In the late 1990s, he began overbilling a government poverty program for the care he provided. In the end, it cost him two years in prison, but not his profession.
"You know, it was just a case of seeing a way to maybe make a little extra money," Carr said.
He was stripped of his license but in 2003 received a new one from the board. He's at a loss to explain why the board granted his application.
"I haven't got a clue," said Carr, who is barred from billing the state or federal government for patients. "I've prayed about it a lot."
The board considers the nature of the crime, the amount of time passed, recommendations from court personnel and other information when deciding whether to license a dental professional.
Cases such as Carr's aren't detailed on the board's Web site. The site notes if a dental professional has faced disciplinary action in the past. In another part of the Web site, there's a listing of the penalty a dental professional received, but it only goes back about three years.
Dr. Robert Baratz, a Massachusetts physician and dentist who helps run the watchdog Web site dentalwatch.org, said it ought to be easier for the public to know about disciplinary actions. "As the consumer, I would like to know. ... A lot of boards want you to go through hoops to try to get it," Baratz said. "I would just as soon click on it and read it."
New York state's Web site, for instance, gives the day action was taken against a dentist, a summary of the infraction -- such as "admitted to the charge of filing a false report" -- and details about penalties, such as the terms of probation and amounts fined.
Dr. Richard Black, an El Paso dentist and past president of the Texas Dental Association, said the group doesn't support adding more information to the Web site.
"I feel that's a privacy issue between the licensees and the people who are disciplined," he said.
The association supported increasing the board's budget.
Online.
Filling the coffers
Like most regulatory agencies of its kind, the Texas State Board of Dental Examiners is a moneymaker for the state, spending less than a third of its revenues.
A look at fiscal 2006 revenue and expenses:
Net revenue: $6,337,539
Net expenditures: $1,806,608
Excess: (to the state general fund): $4,530,931
Source: State of Texas 2006 Annual Cash Report
About the Consumer Report Card series
Evaluating healthcare professionals
This report is part of the first installment of a periodic series of stories examining how well Texas is fulfilling its consumer protection role. Findings are based on documents and data compiled by the state, and the Consumer Report Card criteria employ some of the measures the state has devised to judge performance. Evaluations were determined by weighing a variety of factors and reflecting the state's overall performance.
Tell us about your problems
What happened when you had a problem with a medical professional? Go to www.star-telegram.com to comment on your experience or to suggest other topics for future consumer report cards.
For information on filing a complaint about a licensed healthcare professional, call the state's toll-free hot line: 800-821-3205
Second in a four-part series examining state regulation of health professionals
One dentist was accused of botching root canals, bridges and crowns and writing 100 prescriptions after his controlled-substances permit had expired.
Another dentist was sentenced to 27 months in prison for overbilling a government program to help the poor. Still another, from Euless, was shot in the chest while breaking into his in-laws' home. He received probation after pleading guilty to criminal trespass and assault charges.
The dentists all have at least two things in common: They're currently licensed to practice in Texas, and the Texas State Board of Dental Examiners only shares details about their past if a request is made in writing -- just don't expect a quick answer.
Some say the governor-appointed board has struggled in recent years to fulfill its basic mission: protecting the public.
Board member Tammy Allen, a Hurst dental hygienist, said the board does the best it can with the resources it has. But she is troubled by a sharp decline -- 58 percent over three years -- in the number of dental professionals disciplined. She's also concerned penalties are handed out too subjectively.
"Two dentists can have the same violation and one will get a warning and the other a $1,000 fine," Allen said. "That's not right, it's not fair, and as a board member, that bothers me."
The state has taken the board to task for such problems as failing to enforce its disciplinary actions and not meeting deadlines.
Consumer advocates are concerned that, while the board can give bad dentists and even those who are convicted criminals a second chance, its Web site merely states if a dentist has faced discipline and the type of penalty imposed. It offers little information about the nature of their offenses.
Supporters say the board in recent years has cleared a large backlog of complaints, some stretching back more than six years. During that time, disciplinary actions exceeded state-set benchmarks, although last year they were lagging.
Fread Houston, the board's general counsel, said the agency's penalty system has been overhauled in recent years to make it more evenhanded. More consistent results would come if the small agency with 29 budgeted employees had more funding, he said.
State reports show last fiscal year the board generated $4.5 million more than it spent. But that money, largely from fees related to licensing, credentialing and examinations, went to the state's general fund. The board spent $1.8 million.
Among other needs is an updated computer system.
"It's crazy," Houston said. "Literally, I look at the screen and it's as if you're in 1980."
Houston said the board is making progress.
"Can it be made better? Yes. I think there is room for improvement."
Backlog of complaints
The board's job is big: Each year it must screen the approximately 12,000 dentists and 10,000 hygienists it licenses, on top of investigating hundreds of complaints.
It has fallen short in both areas, according to the most recent state auditor's report on the board.
Houston said he doesn't agree with some conclusions reached in the August 2005 report, including the discovery that six convicted felons weren't investigated during the licensing process.
The board uses the Texas Department of Public Safety to conduct criminal background checks but relied on a report that showed only changes in criminal records during the prior four months, rather than a full criminal history as required by law.
The board responded by saying that it would work with the DPS to ensure it obtained full histories on all new licensees.
"It wasn't that we weren't doing our job," Houston said. "It was that the information we were getting back was just not complete."
The audit also found that sanctions imposed against dentists and hygienists weren't enforced. One dentist, for instance, was required to receive peer assistance for a substance-abuse problem. The day after the board was notified the dentist hadn't done so, its staff renewed his license.
In response, the board noted that it is not authorized to use the license-renewal process as a disciplinary tool.
In a separate report by the Legislative Budget Board, the board took hits for failing to investigate complaints on time. In 2005, for instance, it averaged about a year to resolve problems, about 80 days longer than the state benchmark. Last year, the board again averaged a year response time, but the state upped the deadline to 400 days.
Earlier this spring, the board faced a backlog of about 270 complaints, including a 2001 case.
The slow response to a backlog of complaints resulted from employees leaving for other agencies or the private sector, Houston said.
From June through December 2005, for instance, the executive director, director of enforcement, five investigators, an attorney and two administrative employees left the board. As a result, new employees were constantly being trained and were unfamiliar with the system. In the legislative session that just ended, the board was granted eight new positions it requested.
Thief's license reinstated
Greed got the best of Amarillo dentist Charles T. Carr.
In the late 1990s, he began overbilling a government poverty program for the care he provided. In the end, it cost him two years in prison, but not his profession.
"You know, it was just a case of seeing a way to maybe make a little extra money," Carr said.
He was stripped of his license but in 2003 received a new one from the board. He's at a loss to explain why the board granted his application.
"I haven't got a clue," said Carr, who is barred from billing the state or federal government for patients. "I've prayed about it a lot."
The board considers the nature of the crime, the amount of time passed, recommendations from court personnel and other information when deciding whether to license a dental professional.
Cases such as Carr's aren't detailed on the board's Web site. The site notes if a dental professional has faced disciplinary action in the past. In another part of the Web site, there's a listing of the penalty a dental professional received, but it only goes back about three years.
Dr. Robert Baratz, a Massachusetts physician and dentist who helps run the watchdog Web site dentalwatch.org, said it ought to be easier for the public to know about disciplinary actions. "As the consumer, I would like to know. ... A lot of boards want you to go through hoops to try to get it," Baratz said. "I would just as soon click on it and read it."
New York state's Web site, for instance, gives the day action was taken against a dentist, a summary of the infraction -- such as "admitted to the charge of filing a false report" -- and details about penalties, such as the terms of probation and amounts fined.
Dr. Richard Black, an El Paso dentist and past president of the Texas Dental Association, said the group doesn't support adding more information to the Web site.
"I feel that's a privacy issue between the licensees and the people who are disciplined," he said.
The association supported increasing the board's budget.
Online.
Filling the coffers
Like most regulatory agencies of its kind, the Texas State Board of Dental Examiners is a moneymaker for the state, spending less than a third of its revenues.
A look at fiscal 2006 revenue and expenses:
Net revenue: $6,337,539
Net expenditures: $1,806,608
Excess: (to the state general fund): $4,530,931
Source: State of Texas 2006 Annual Cash Report
About the Consumer Report Card series
Evaluating healthcare professionals
This report is part of the first installment of a periodic series of stories examining how well Texas is fulfilling its consumer protection role. Findings are based on documents and data compiled by the state, and the Consumer Report Card criteria employ some of the measures the state has devised to judge performance. Evaluations were determined by weighing a variety of factors and reflecting the state's overall performance.
Tell us about your problems
What happened when you had a problem with a medical professional? Go to www.star-telegram.com to comment on your experience or to suggest other topics for future consumer report cards.
For information on filing a complaint about a licensed healthcare professional, call the state's toll-free hot line: 800-821-3205
Subscribe to:
Posts (Atom)
