Back Button
Menu Button

Why It Matters to Have Private Health Coverage

I should not be astonished, but I am.

In 1910, Dr. William J. Mayo wrote his view on making patients a central reason for his organization to exist: “The best interest of the patient is the only interest to be considered, and in order that the sick may have the benefit of advancing knowledge, union of forces is necessary.”

But 107 years later, the healthcare landscape has changed, running opposite to Dr. Mayo’s credo.

A March 15 article in the Star Tribune revealed a healthcare system truth that some have suspected for years – that it’s a tier-system of care dependent on the type of health insurance card you carry in your wallet or purse. If you are fortunate to have private insurance coverage through your employer or have personally purchased it through a commercial insurance company, you should feel somewhat privileged. However, if you have Medicaid or Medicare coverage, please step to the back of the line.

Dr. John Noseworthy, CEO at the famed Mayo Clinic, was videotaped speaking to his staff last fall about giving preference to patients with private insurance over lower-paying public coverage (e.g. Medicaid and Medicare). “We’re asking…if the patient has commercial insurance, or they’re Medicaid or Medicare patients and they’re equal, that we prioritize the commercial insured patients enough so…we can be financially strong at the end of the year to continue to advance, advance our mission…”.

It is important to note that, regardless of payer source, Mayo will always take patients when they’re unable to find medical expertise elsewhere. However, when given two patients who have equivalent medical conditions, the Mayo health system will “prioritize” the patient with private insurance – private plans pay Mayo (and all other providers) more than public coverages. Noseworthy continued, “If we don’t grow the commercially insured patients, we won’t have income at the end of the year to pay our staff, pay the pensions, and so on…so we’re looking for a really mild or modest change of a couple percentage points to shift that balance.”

Hospitals are not allowed to discriminate against patients seeking care in the emergency room. Outside the ER walls, however, providers can choose to accept (or decline) Medicaid and Medicare patients. Mayo recently indicated to Modern Healthcare that Medicare and Medicaid patients account for half of their services, but with more baby boomers becoming eligible for Medicare, coupled with Medicaid expansion, Mayo is looking to have higher-paying private insurance offset the shortfalls received from public health plans.

The ‘dirty little secret’ of establishing a pecking order of patients, based on payment sources, has not been widely known. In that sense, kudos to Mayo for their honesty, as it appears they are not attempting to sweep this fact under the rug. Yet, the Mayo acknowledgement that commercially-insured patients would get preferential consideration in certain situations should raise questions for those of us who are covered by private payers.

If the provider community establishes a pecking order between public and private payers, could special consideration also be given AMONG private payers? Think about it. If margins are so thin for world-reknown providers like Mayo, why wouldn’t other medical providers seek similarly-related practices with all sources of revenue?

For example, if insurer A reimburses hospitals at a higher rate over other private insurers within that particular market, would insurer A patients receive preferential consideration, much like what Mayo described? If so, are you better off purchasing health coverage at a higher premium from insurer A because their reimbursement rates will guarantee preferential service compared to other insurers within that market?

This raises questions about the potential practices initiated by the provider community. Having a particular insurance card provides a ticket of entry into our healthcare system. But does it also determine the level of care we ultimately receive?

What’s in your pocket or purse? In healthcare, it just might matter a great deal.

To learn more, we invite you to subscribe to our blog.

Seriously…Cleveland Clinic?

Sweeping Dirt Under RugHarvard, Yale, Princeton and Stanford – all are very prestigious universities.

Likewise, the Mayo Clinic, Johns Hopkins and Cleveland Clinic – are all are very prestigious medical facilities, right?

Having a stellar reputation takes years (and generations) to build, whether it’s institutions of higher learning, healthcare organizations or law firms, etc. Being ‘prestigious’ comes with many flattering adjectives like: celebrated, trusted, respected, prominent, great, important, imposing, influential, renowned, and exalted.

The Cleveland Clinic has enjoyed this elevated stature for years. But, unfortunately in healthcare, it may be easier (and cheaper) to ‘buy’ an image of quality than it is to consistently perform quality care practices day in and day out – especially when the image is protected by suppressing information from state and federal authorities regarding safety practices.

Believe it or not, Cleveland Clinic was on a “termination track” with Medicare between 2010 and 2013 (19 total months) for more than a dozen inspections that occurred due to patient complaints. Cleveland Clinic was threatened to lose its almost $1 billion annual Medicare reimbursements – quite a hit, even for a multi-billion dollar organization. After repeated Cleveland Clinic violations, the Centers for Medicare and Medicaid Services (CMS) took the unusual step to personally cite CEO Toby Cosgrove and the Cleveland Clinic Governing Board.

In June, Modern Healthcare reported that retired Air Force Col. David Antoon had accused Cleveland Clinic of withholding documents from federal authorities while the Clinic was being investigated for substituting Antoon’s authorized surgeon with a medical resident that resulted in a gross medical mistake. Mr. Antoon suffered serious disabling injuries resulting in the loss of his job as an airline pilot.

According to this article, and based on my correspondence with Mr. Antoon, the Cleveland Clinic hid important documentation from federal inspectors to avoid responsibility (and liability) for their derelict actions. If this can happen at a prestigious institution, you can be confident that it can happen anywhere.

As mentioned in previous blogs, Rosemary Gibson, senior advisor at The Hastings Center, did a splendid job of explaining in her book, “Wall of Silence,” how the ‘medical industrial complex’ in this country is conspicuously silent when it comes to medical mistakes that kill and injure millions of Americans.

U.S News & World Report recently published the ‘Best Hospitals Rankings’ and placed the Cleveland Clinic in the top position for Urology. In contrast, Healthgrades ranked Cleveland Clinic with the lowest possible score for prostatectomy outcomes; CMS data for Hospital Acquired Conditions (HACs) placed Cleveland Clinic in the bottom 7% of all hospitals with a score of 8.7 (scores ranging from 1- 10, with ten being the worst); and the independent Leapfrog Group gave the first ever “D” grade to Cleveland Clinic for patient safety. WDAF-TV (Kansas City, MO) recently reported that hospitals must pay US News to use the “Best Hospitals” logo in advertising. Many rating organizations charge hospitals to market their grades. So what can the public believe: “pay to play” advertising or independent reviews?

The Cleveland Clinic will continue to pay US News to market itself as evidence that they are a ‘prestigious’ medical organization, and yet quietly sweep the CMS action, and other independent negative reviews, under the rug.

Again, my point is simple. If this happens to the prestigious Cleveland Clinic, it can happen anywhere – and it does. Unfortunately, the Cleveland Clinic story is only the tip of the proverbial medical iceberg. The medical industry is unwilling and, quite frankly, unable to reform itself from within. Because of this reluctance, it is now time for the public to apply transparency measures. Our own lives may depend on it.

As the saying goes: “Fool me once, shame on you. Fool me twice, shame on me.” I think this easily applies to all of us who continue to allow the medical establishment to self-regulate with secrecy – resulting in unnecessary harm to unsuspecting patients.

I’d love to hear your thoughts.

To learn more, we invite you to subscribe to our blog.