Texas – As a businessman and former legislator now working on behalf of insurance reform, I get a lot of questions from employers, entrepreneurs and individuals seeking to make their dreams into realities. One of the most frequent questions I get is: What keeps me up at night regarding matters of state politics and policy? The answer is health care.
The fact is many Texans are discovering they cannot afford health care because costs are rising at unsustainable rates. Business owners want to offer jobs with decent wages and affordable benefits, but affordable benefits may not continue to be an option in Texas.
I am not sure when much of the Texas health care industry transitioned from a health care delivery model to a profit model, but the numbers demonstrate this change. According to the Health Care Cost Institute, from 2014 to 2018 higher prices accounted for 74% of total health care spending increases above inflation on a national basis. In the meantime, Texas has experienced an increase of 13.8% in spending for that same period. In other words, many providers are charging more for the same services.
We have all read the stories about those providers who have taken advantage of the pandemic to charge thousands of dollars for a single COVID-19 test that often costs $50. Even with the great strides taken by Texas legislators, many emergency providers and facilities continue to charge steep prices when they find the opportunity.
State law can only impact a portion of the insurance market. However, state law can reach 100% of all health care facilities and providers. It is finally time to realize that the problem is not simply the insurance benefit purchased by employers. The real problem is the providers and facilities who are driving health care costs even higher.
Another insidious way that some providers profit from those who suffer from health maladies is by recommending treatments and interventions that enhance their own financial benefit rather than patient well-being. In August, the Centers for Medicare and Medicaid Services concluded that provider “financial motivation is the most likely cause” for a sevenfold increase in claims volume for certain serious back surgeries. CMS decided that “prior authorization is an appropriate method to control these volume increases.
Prior authorization is a review by medical professionals at an insurer to make certain that a provider does not prescribe an unnecessary drug or procedure for medical conditions. Yet, already in this legislative session a proposal has been filed to prohibit prior authorization for any medical services.
The protests about prior authorization you hear from some physicians and their private-equity investors, and organized medicine stem from their awareness that the practice can expose their methods. The financial consequences for the public of the abuse and overcharging in health care in Texas is both morally and economically indefensible.
Here is what Texas should do to combat any attempts at unjust enrichment:
• Mirror CMS by relying upon prior authorization to stop providers who are motivated by financial considerations. Prior authorization is the last-ditch attempt to stop unjustified medical care.
• Empower Texas state agencies to better protect the public by bolstering their abilities to pursue allegations of fraud and prosecute health care providers who recommend unnecessary health care for financial reasons.
• Regulate the business of medicine and broaden current medical gouging laws to stop health care overcharging.
