Skip to main content

See also:

LB887 - "Wellness in Nebraska Act" is Legislative Malpractice

Nebraska State Capital
Nebraska State Capital
Highsmith

1 The Issue

The advent of the Affordable Care Act (ACA) has created a number of problems for our state that did not exist prior to that legislation, in addition to exacerbating most, if not all of the existing issues faced by Nebraskans.

We long ago decided as a society to care for those who could not care for themselves. This deference to the needs of the vulnerable is a hallmark of our social contract and has been a driver of public policy for more than a century. It is the foundation of our entire social services system.

For more than a century the issue hasn’t been “should we,” but rather “how can we” best utilize taxpayer dollars to ensure an acceptable level of care for this population. The problem however, is in defining this population and determining the meaning of “acceptable” as it relates to our responsibilities under our social contract.

The argument over the ACA will not be resolved by what we do here, in the Unicameral, but we will determine the direction our state will take for the next decade or two, and that decision will be among the most consequential choices ever made in our state. We cannot fail to choose wisely.

The proponents of LB887 say their bill will:

Cover the uninsured

Control the rising costs of health care in Nebraska

Resolve issues of access to Primary and Specialty care in underserved areas

Provide assistance to the Medical community in areas of workforce development

The cost of health insurance is driven by multiple factors, not the least of which is government mandates for care, coverage or reporting. LB887 relieves none of these pressures, but instead increases each exponentially.

The number of uninsured in Nebraska is in some dispute, and the fluidity of employment options, economic conditions and income dynamics make certain that the true number will always be a moving target. That being said, the most common figure cited is roughly 100,000.

This number is made up of the Medicaid newly eligible under Expansion plans from the ACA, in addition to those individuals who are currently eligible for Medicaid, but are not enrolled for some reason.

It is this eligible, but unenrolled population that remains unaddressed in LB887. It is essential to remember that the much touted federal reimbursement rate for Medicaid expansion under the ACA (100% stepping down to 90%) only applies to the newly eligible population.

Those currently eligible but not yet enrolled will be reimbursed at the current Medicaid match rate, although the state will still be mandated to provide coverage for them at the level provided the newly eligible, which LB887 has set at “Silver plan or equivalent.” This clearly is an unfunded and unaffordable mandate.

Between 20% - 38% of the uninsured in Nebraska will not be covered at the 100% rate. Calculated on the low end, this still represents an increase in state expenditures that is roughly equivalent to the existing annual budget for road and bridge maintenance for the entire State of Nebraska.

These estimates also assume that participation rates will be lower than 74%. Data from states who have expanded Medicaid already indicate that the level of participation is indeed much higher.

To put it succinctly, all the reasons for opposing last year’s Medicaid Expansion bill (LB577) remain applicable to this year’s attempt, in addition to a great many more specific to LB887.

Included in this paper is a position statement from Nebraska Taxpayers for Freedom outlining their opposition, and their reasons for it, as well as a copy of the recent report on LB887 from the Platte Institute. It isn’t necessary to recap the specifics of their findings in this report, as the findings themselves are attached for your review. It is important to understand the overall climate to which their analyses apply, and that is the purpose of this paper.

The egregious overreach of the ACA has broken down many long-held and respected barriers to bureaucratic intrusion into the lives of individual citizens. Because the ACA involves the use of tax dollars to such an unprecedented extent, policy-makers have taken the tack that they must exercise greater control over the practice and system of medicine in order to satisfy their obligations of good stewardship of public funds. To this end, their ideas have ranged from mild “nanny-state” incrementalism to full-blown advocacy of single-payer socialized medicine.

LB887 and its preparatory legislation, LB916, cannot be fully understood, nor their ultimate impact assessed without an appraisal of their provisions in context of Legislative Resolution 422, which is a plan structure for the “transformation” of health care in Nebraska. An examination of the clear language in LR422 pulls the curtain back from the wizard, exposing the stunning overreach of LB887. To begin however, let’s examine the “infrastructure” bill, LB916.

2 LB916

This bill is enabling legislation for LB887 in that it creates a shift in health care staffing and delivery systems that is necessary for LB887 to function, at least on paper. LB887 requires the large-scale implementation of the Patient Centered Medical Home model of health care delivery, and the utilization of lower to mid-level health care workers as the first (and often only) point of contact between patient and their Medical Home is the means by which costs are controlled and access increased.

Rather than a patient presenting with symptoms to a physician, they are instead shuttled to a Nurse Practitioner who costs far less per visit than a licensed physician. Unfortunately, they also possess far less training and if LB916 is passed in present form, even less actual experience.

Nurse Practitioners have an educational path that involves a 4 year degree in Nursing followed by at least 2 years in an advanced Masters-level course of work. Contrast this with the Bachelor – Medical School – Residency path of the physician and the gap becomes more evident.

The essential difference however isn’t just time in school, because a Nurse Practitioner can opt for more schooling; the issue is what is studied, and how it is applied. The Nurse Practitioner uses tick-box formulae for diagnoses and treatment. If patient presents with “A”, then proceed to “B.”

LB916 attempts to streamline the process by which Nurse Practitioners enter the day to day operations of our health care system. It does this by eliminating a rather important credentialing requirement – two thousand hours of work under the direct supervision of an MD. This means that a Nurse Practitioner fresh from school could begin seeing patients almost immediately.

The bill also allows for the Nurse Practitioner to operate without the supervision of an MD. This recklessly endangers the health of anyone presenting with atypical symptoms not covered in the school setting. Atypical symptoms that a physician is trained to understand.

This in itself is concerning, but becomes unacceptably so when taken in light of the role Nurse Practitioners are expected to play under the “transformation” promised by LR422 and implemented by LB887. Lacking the actual patient care experience a physician gains in Medical School and Residency leaves the Nurse Practitioner ill-prepared for the responsibility LB916 lays upon them.

Under the PCMH model, and as envisioned in LB887, Nurse Practitioners will fill the roles currently held by physicians themselves. They will see patients, make diagnoses and craft treatment plans. They will even be permitted to dispense pharmaceuticals, as long as those drugs are on hand in sample form.

So why would the proponents of Medicaid Expansion want to dilute the credentialing requirements for Nurse Practitioners while simultaneously elevating their role to a near equivalence with a physician? To grasp the significance, it is necessary to understand the PCMH model.

3 Patient Centered Medical Homes

At first blush, the principles behind the PCMH model appear sound and perhaps even intuitive. As with many things, all is not as it seems. The savings relied upon in LB887 come from the expected benefits of preventive measures and screening that form a large part of the PCMH concept. However, these savings are at best ephemeral due to economies of scale (screening an individual with risk factors may bear fruit, but screening an entire population simply wastes money) and in most cases unattainable due to the inherently individual nature of medical care.

The idea is, prevent the disease and consequently lower the cost of treating the disease later. Care coordination intends to eliminate duplication of medical testing and unnecessary procedures by centrally directing the care of a patient among their primary provider and any assorted specialists or therapists involved in the patients care.

While some duplicative tests are undoubtedly performed, eliminating those is hardly enough to move the needle on rising health care costs. A far greater expense is incurred because of physicians practicing “defensive medicine,” due to an overly litigious society.

In order to protect themselves from becoming the target of an enterprising young attorney, physicians are ordering tests beyond the realm of sensibility in an attempt to create a “safe harbor” against opportunistic lawsuits. LB887, LB916 and the PCMH model do nothing to alleviate this significant driver of increasing costs.

While it is likely possible that care coordination might result in less duplication, those efficiencies come at the price of a bureaucrat’s intervention between a patient and their physician. Treatments and decisions are continually second-guessed, which leads to needless delay and frequent denial of care.

More importantly however, all this bureaucratic heavy-handedness fails to exert any downward pressure at all on the far larger cost of the above-mentioned preventive care, upon which LB887 relies for success.

Expenditures for the preventive elements of care, such as labs for screening, prescription drugs and primary care visits for the covered populations, increase by as much or more, than the costs of treating the individual chronic diseases themselves.

The definitive review of the PCMH concept was published in the Annals of Internal Medicine (a publication of the American College of Physicians, themselves proponents of PCMH) where they discovered that there was “no evidence” of cost savings from the PCMH model, and more significantly, evidence for improved health outcomes ranged from “negative to inconclusive.”

The lesson learned, is that preventive care costs money too, and since it is applied to all patients, it overwhelms the savings expected from installing the PCMH model in the first place. One of the largest “coordinated care” companies in the world is Quantum Health, Inc. Independent studies of their performance data confirm this finding.

The physicians end up seeing more patients for less money, Nurse Practitioners become gatekeepers to medical care while the patients themselves have an army of do-gooders nosing into their personal lives searching for "disease metrics" and "risk factors" so they can swoop in and "educate" them on how to eat properly or to exercise more.

Physicians will simply quit accepting Medicaid patients. A recent poll conducted by the American Association of Physicians and Surgeons (AAPS) found that 60% of the docs surveyed planned to drop Medicaid and Medicare recipients rather than work under the onerous rules involved in the PCMH model.

It is this expected exodus of talent that creates the need for LB916’s exaltation of Nurse Practitioners, to take the place of physicians. Wouldn’t it be wiser public policy to not force the physicians out in the first place?

Truly, the only people happy with the plan are those major insurers and hospital groups, the army of Wellness Vendors (often owned and operated by the insurance companies themselves) and the IT vendors who all grow wealthy by make the whole ball of wax grow. Medicine becomes an entirely industrial, corporate affair.

Furthermore, because the PCMH model advocated under LB887 intends to replace our current fee-for-service system with a version of pay-for-performance, the physicians involved won’t be paid in full unless they can prove their patients are getting better.

Here’s what that looks like: Medicaid tells the doctor that they will pay him a percentage of his usual fee at time of service, and the remainder only after he shows that the patient has met benchmarks of health as determined by the assorted bureaucrats.

In simple terms, the physicians pay becomes based on whether or not the obese patient begins pushing himself away from the table sooner, or the chronically ill patient remembers to take their medications as prescribed.

Clearly these things are beyond a physician’s control – absent an unacceptable level of intrusion into the personal lives of his patients – or the more egregious involvement of the aforementioned army of do-gooders enforcing the doctor’s orders. Neither scenario is compatible with the rights of a free society in our great state.

Last year’s bill to expand Medicaid was a disaster that fortunately failed. This year’s attempt is a colossal disaster. LB887 will not only expand Medicaid unsustainably under the rubric of ObamaCare, but also engages in reckless government overreach by attempting to fundamentally transform the way medicine can be practiced in our state.

This top-down, authoritarian model of medicine is already a proven failure, faddish and needlessly invasive to individual privacy and lifestyle choice.

It is this overarching need to “do more with much less” that is behind LB916 and its reckless reliance on lower paid, inadequately trained medical staff to do the work of physicians. In the end, the patient receives substandard care, but the numbers look good on paper. LB916 and its parent, LB887 are by no means "the Nebraska way."

4 “Wellness in Nebraska”

Healthcare paid for by the government comes with a responsibility to ensure efficient use of tax dollars and reasonable expectations of satisfactory performance. Representatives and government employees feel this responsibility keenly and for the most part have worked very hard to get the taxpayer the best “bang-for-the-buck.”

We have an excellent example of just such an attempt from right here in our state. The Wellness Options program for state employees has been given numerous awards, cites eye-popping savings and is given the imprimatur of Warren Buffett’s own Wellness Council of America (WELCOA).

This program has been credited with saving 4.2 million dollars for the state, accounting for a 40% increase in disease diagnoses among the 5199 screened employees, making “life-saving, cost-saving catches” of 514 people with “early-stage cancer,” and generating a 3% reduction in both risk and prescriptions written.

While this sounds like stellar performance, a careful look at the data shows otherwise. Alfred Lewis, a Harvard trained statistician and acclaimed expert in Disease management discovered that each of these claims range from false to outrageously false.

The above claims were made in a report by the state’s wellness vendor, Health Fitness Corporation as part of their submission of data to WELCOA for consideration for the C. Everett Koop Award. Mr. Lewis examined each of the claims using the data provided by HFC.

He discovered that the 40% increase in diagnoses were made up largely of “risk factors,” such as sedentary lifestyle or dietary no-no’s such as too much red meat. These were not instances of discovering undiagnosed diabetes or hypertension and the like. This is borne out by the fact that none of the 40% cited received any medical intervention whatsoever as a result.

No prescriptions, no procedures, nothing. In fact HFC’s own data shows that this 40% didn’t even reduce their risk factors. Only 3% did so, equating to roughly 161 people.

This very low number is put in greater context when you consider that it was calculated against on-going participants, as those who had dropped out, or never participated in the first place weren’t counted. In essence, we are to believe that millions of dollars were saved by 161 people, a statistical impossibility.

But what of the “life-saving” discoveries of “early-stage cancers?” Catching cancer early is the key to better treatment outcomes, and ultimately lower costs, right? Again, look at the numbers and how they were calculated.

Assume for arguments sake that the 514 claim is true, (it is not). This incidence rate of cancer among Nebraska State employees would be 40 times higher than the residents of Love Canal. As Mr. Lewis puts it, “unless Nebraska’s statehouse sits on top of a toxic waste dump, such an incidence of cancer is obvious nonsense.”

In reality, HFC counted as “early-stage cancer” every benign polyp, cyst or skin lesion regardless of type, claiming that they were in fact “pre-cancerous.” Later, after they were caught in the lie, the company said the need to emphasize wellness as a success outweighed the need to tell the truth.

This is a common happenstance among the Wellness industry, where inflated numbers and junk science are routinely employed to sell programs that simply don’t deliver what they promise. This is what LR422 and LB887’s “transformation of the health care system of Nebraska” looks like.

The PCMH model relies largely on Wellness and prevention for its savings. As we have seen, those savings don’t exist. Furthermore, careful examination of other state’s forays into PCMH and Wellness show increased costs in many cases and not a single instance of success that stands up to the scrutiny of fifth-grade math.

The circumstance we face now however is dramatically altered in scale and scope. The ACA has so distorted the medical and insurance landscape that it is difficult, if not impossible to fulfill the responsibility to the taxpayer while respecting constitutional norms of individual privacy and liberty. The ACA requires government to overstep their bounds as a matter of course.

Unfortunately, more than a few Senators in our Unicameral appear to be of the opinion that their desire to effect the “transformation of Nebraska’s health care system” overrides the Constitutional right of the people to be let alone. Consequently, we have the Wellness in Nebraska Act, which, when combined with the clear language of LR422, is nothing short of the full embrace of ObamaCare in Nebraska.

The ACA as a law is in trouble. The launch has failed spectacularly, and the public is gaining awareness of the acute loss of individual choices and rights that attend the implementation of the law. Even some lawmakers involved in the passing of the original bill are having second thoughts due to the incredible disconnect between the ACA as promised and the ACA as delivered.

The outlook for the law’s future is uncertain, and is made more so by the repeated usurpations of authority by our chief executive, President Obama. His unilateral modifications to the clear language of the law have eliminated any credible reliance on the letter of the law as a guide for policy.

Not to put too fine a point on it, but the President’s extra-constitutional behavior – modifying existing legislation without Congressional action – is the very definition of “making it up as you go along.” The present degraded state of the ACA has rendered that law, under this administration, entirely unsuitable for de jure or de facto policy-making at the State level.

Anything we do at this point is subject to the whim of the President and his staff. Most Nebraskans would agree that reliance on a whim is a singularly unwise way to make law. The Wellness in Nebraska Act relies entirely on the ACA remaining whole and unchanged in its present form, and given the recent actions of the Obama Administration, that is a near impossibility.

It is fair to examine the motivations behind the proponents of both bills. From the standpoint of the insurance companies and major hospital and medical groups, support is an economic issue. There will be money coming in to the state, and these are the entities that will receive it. Given the relatively limited number of providers sufficiently staffed and capitalized to implement the PCMH model in Nebraska, that wealth effect is greatly magnified by the scarcity of competition.

From the standpoint of the legislators, there is power. LR422 envisions an oversight committee with power to not only observe and report, but also to direct and operate the mechanisms of state government toward the aforementioned transformation of medical care in Nebraska.

In LB887 this “star-chamber” finds its voice. The bill vests a tremendous amount of power in a new nine member oversight committee that not coincidentally, is to be headed up by the bill’s sponsor, Senator Kathy Campbell. It will then add two more members from the HHS committee along with others drawn from Appropriations, Banking, Commerce and Insurance and two at large members.

Of course, by choosing to limit the available pool of appointees to these committees, the bill makes certain that each of its co-sponsors will be in line to sit on the Oversight Committee itself.

All are appointed by the Executive Board of the Legislative Council, a panel on which we find once again, Senator Campbell, and another member of the HHS committee, Senator Bob Krist.

All told, the Executive Board has a clear majority of members who supported last year’s attempt to expand Medicaid. Given that bit of information, I think it is fair for Nebraskans to be concerned that “diversity of opinion” will not be a prerequisite for appointment to that committee.

This bill further provides for the committee to hire its own “consultant” and to put together an unlimited number of work groups and stakeholder organizations to assist in the furtherance of its duties. In other words, on top of everything, the taxpayer also gets to pay for the oversight committee’s lobbying efforts.

LR422 has something of an Orwellian provision that calls for the Oversight Committee to be the sole determiner of what information and data will be considered by the committee, and presumably, by the downstream agencies of government responsible for implementation of the committees “recommendations.”

It isn’t enough to snatch control of health care from the private sector – the oversight committee demands the installation of an echo-chamber as well.

Ultimately, it is the vulnerable populations Medicaid was intended to serve that suffer, as fewer physicians are willing to navigate the labyrinthine regulations, restrictions and bureaucracy involved in the Medical Home concept, and simply refuse to participate.

This has occurred again and again in states that have adopted this model. Nurse Practitioners are not physicians. They are quite useful in their present role as valued members of the physician’s staff. They are not however, a substitute for the physician, and passing a law that says they are is only an invitation to failure. We have a difficult journey ahead of us in Nebraska already, and LB 887 makes the road impassable.

Now that we see the building blocks of our Patient Centered Medical Home, it is prudent to consider what purposes such a building might serve. The answer to that is found in the next section.

5 Legislative Resolution 422

Both LB887 and LB916 must be considered in the context of LR422. It is always popular to declare a devotion to excellence as a motive for any initiative, and much of what is done by government is undertaken under these auspices. The question that must always be asked however, is how do we define said “excellence,” how do we measure said “excellence,” and finally, who does the measuring.

LR422 sets out a premise that is at once appealing and terrifying. It attempts to establish a crisis circumstance, then proposes to rectify that crisis with an unadulterated takeover of the healthcare system of Nebraska. It is the adoption into Nebraska law of ObamaCare, in its entirety.

From LR422 -

WHEREAS, successful transformation of Nebraska's health care system is essential to the state's economic well-being; and

WHEREAS, health care reform requires the transformation of health care delivery into a patient-centric, high-value enterprise; (emphasis mine)

LB887 and LB916 aren’t just about increasing access and providing coverage, LR422 makes it clear in plain language that we are to engage in a “transformation.” Given the catastrophic state of “transformation” of health care on the federal level one could be forgiven for an excess of caution at the state level.

Continuing from LR422 -

WHEREAS, state government must provide clear leadership for health care system transformation efforts that results in transparency, trust, and full participation from all partner stakeholders; and

WHEREAS, as a result of Legislative Resolution 22 (LR22) passed during the One Hundred Third Legislature, First Session, the Health and Human Services Committee, in conjunction with the Banking, Commerce and Insurance Committee, held a conference on health care in Nebraska attended by 167 stakeholders from across the state; and

WHEREAS, the LR22 stakeholders’ conference examined what the Nebraska health care system should look like in fifteen years and what opportunities and challenges Nebraska patients, providers, and payers will face during the period of change over the next fifteen years. This examination resulted in dialogue on population health, personal health, health care worker education and care processes, and delivery of health care and health care costs in Nebraska; and

WHEREAS, LR22 initiated the discussion, but there is opportunity for continued partnership and leadership by the Legislature in the development of a vision for transformation of the Nebraska health care system.

That vision is outlined and visible in LB916 & LB887. If that vision looks familiar, it is because we’ve seen it before – it is ObamaCare.

As elected members of government, it is prudent for you to consider the mood of the electorate before plunging ahead with controversial initiatives. Recent polling in Nebraska shows an undeniable distaste for the ACA. Nationally, a clear majority wish it had never been passed, and locally the opposition to it is bipartisan in nature.

LR422, LB916 and LB887 are ObamaCare. They are an attempt to install in our state the provisions of a law that is despised, unworkable and crumbling as we speak. A vote in furtherance of any of these bills is a vote to enact ObamaCare in Nebraska, and will be seen as such by voters. A desire to maintain electoral viability for future office would preclude support of these bills.

The PCMH model relies upon savings that aren’t there. The end result of attempting to implement it large-scale will be nothing short of make-work medicine. Lots of access points, delivering substandard care, making those involved feel useful, but not moving the needle on health outcomes or cost savings.

Considering that expanding coverage and cutting costs are the reasons given for introducing these bills in the first place, failing to accomplish these aims is evidence that the whole enterprise is fatally flawed and ultimately damaging. LB887 is Medicaid for the able-bodied, which is an inappropriate use of those funds.

We can solve the problems facing our state without embracing lower standards in return for greater access. Once again, the sponsors and co-sponsors of Medicaid Expansion have wasted the time of Nebraskans by pursuing a fantasy rather than solving a problem. ObamaCare on any scale is a failure. To embrace its principles and codify them in Nebraska law is truly legislative malpractice.

We urge the Senators of the Unicameral to reject these bills in their entirety.