LTC Consulting Lens: PBM For Dummies

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Stay informed with LTC’s outlook on the Healthcare business world, our AR collections, receivables financing and collection of receivables processes. News, upcoming changes, and policy updates. A great way to keep on the pulse of our industry, without searching further than YouTube.

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Steve Shain: Hi everyone and welcome back! So now that the big conferences-HIMMS, The NIC and of course ECAP – who can forget ECAP? – are now over, it’s time to get back to work and try to focus on what’s coming up ahead. A few weeks ago, I was at the AJAS conference, so I was speaking to a crowd there and I showed them a picture of this individual and I asked them “Does anyone know who this is?” No one did. I even said his name; his name is Alex Azar “Does anyone know who that is?” and they didn’t. And this is a group of health care providers in the room.No one did, so don’t feel bad if you don’t know either. Mr. Alex Azar is the Health and Human Services Secretary of the Untied States of America. He’s probably the most influential person in the healthcare industry that there is today. A little while ago Mr. Azar got up and he said that he is looking to disrupt healthcare as we know it. He’s looking to make major changes and he’s looking to do them extremely quick. What is his focus? Mr. Azar is looking to get the industry to go into the direction of value-based care. Value-based care does not look at how much care or the level of care that you’re giving to a patient, but rather the outcome. What are you doing to rehabilitate the patient? That is the focus and with that is a larger focus of lowering the cost of healthcare in this country. How does he want to do that? Well first line of business is to focus on the health insurers and the pharmaceutical industry. Until now, these two industries were really two separate things but lately the health insurers have been acquiring some of the companies on the pharmaceutical side. We have CVS Caremark that now merged with Aetna, we have Cigna that just recently announced that they’re buying out Express Scripts. Express Scripts is not really a pharmacy, it’s actually a PBM. A PBM – no, a PBM is not a proud bald man – no PBM is a pharmacy benefits manager. Pharmacy benefits managers were put in place in order to make sure that the drug makers don’t hike up prices too high. They were kind of like policemen to make sure that the prices would be fair. But now, the insurers have acquired these PBMs. They could police the drug makers but who’s going to police the health insurers for making sure that they don’t hike prices up? Enter this guy. This is Mr. Scott Gottlieb, he is the FDA Commissioner. He got up last week and gave a fiery speech to health insurers, telling them that they cannot get away with anything like this in the future. He said that this is very, very dangerous. From the three largest PBMs that are out there, they are controlling more than two-thirds of the PBM industry right now. And he said that it’s no lie that when you get these PBMs joining with health insurers, that is making the market much less competitive. Much less competitive is making the prices go up and they are putting a stop to it. What are their goals? Basically, what they’re looking to do is bring a lot more drugs to the market quicker. So, they’re going to bring generic drugs at a quicker pace. Drugs that usually would have to go through red tape in order to get FDA approval in order to hit the market are going to get a little bit of a faster pace in order to get the market kind of flooded with a lot of medication, a lot of available medication, which will bring the prices down. So, focusing on that on the pharmaceutical side and on the health insurer side, and on the healthcare provider side, they’re looking for value-based care, focusing on value and outcomes, and not value and…incomes. This is all going on at the same time as we have the three billionaires from Amazon, Berkshire and Chase that have been scheming together trying to give small hints about a huge disruption that they’re going to bring to the healthcare industry as well. We don’t know what it’s going to be, hopefully it’s going to be good. But come to think of it, Mr. Bezos here, he is definitely a PBM if you know what I’m talking about. So only good things can come from those people, so hold on tight we’ll see what happens from these new players that are in the market that are looking to change it. And until next time, thank you so much for watching and of course if you have any comments, questions, please feel free to reach out to me, that way we can make this better for you. Take care.

LTC Consulting Lens: Good News vs. Bad Weather

Another great clip!

Stay informed with LTC’s outlook on the Healthcare business world, our AR collections, receivables financing and collection of receivables processes. News, upcoming changes, and policy updates. A great way to keep on the pulse of our industry, without searching further than YouTube.

Subscribe to our You Tube Channel so you don’t miss the next one! Get in touch with us about a free evaluation!


Here we go 2018. If you’re like the most of us here, you probably were covered in snow for the first part of this month and finally just creeping out of it. Or you’re one of those people that completely avoided it – you were in beautiful weather – and you were the ones sending screenshots to your friends of the beautiful forecast you had for the rest of the week, getting us all jealous. Thank you, that was really great. No, it brightened our day, thanks!

Either way, whoever you are, it’s the beginning of the year it’s January. It’s like that fresh snow is out there, nobody stepped on it yet, we like to just keep it positive, keep that holiday cheer going a little bit longer. So for this video I’m going to give everyone some good, positive stories coming out of our industry. So hopefully it’ll brighten up your day a bit.

No. 1 – we have out of Connecticut. There was a pending budget cut for the Medicare Savings Program. Medicare Savings Program was in place by the state in order to help many Medicare beneficiaries – senior citizens – that were getting coverage for their Medicare part B premiums, for some co-pays, deductibles, a lot of out of pocket expenses. And this budget cut that was going into place was going to change the eligibility standard for this program and therefore, many, many seniors were going to lose that coverage. In the beginning of this month, the state announced that although it was going to make about $70 million in savings by going ahead with this budget cut, it was also going to make about 113,000 seniors really, really mad. That was not something that they were just able to pull off, and therefore, they announced that they were keeping everything status quo. The same eligibility standards that were in place are going to stay in place and everybody gets the coverage that they were expecting. So, I don’t know what they’re going to do about that big gap in their budget but maybe a suggestion is don’t try to pass a budget cut that has so much pushback from the whole state. But that’s just a suggestion. I thought that was great news.

Now, I saw in the New York Times this morning an interesting story about hospitals that are losing patience. Many hospitals are losing patience. And they’re running out of patientce because they’re waiting and waiting, the doctors are waiting, for medication to be coming in and the medication in not arriving. When they finally get this medication, the prices are extremely expensive, skyhigh costs, and did you get my joke by the way with the patience thing, I was talking about the other – oh you got it – ok good, I just wanted to make sure, I wanted to make sure you got my joke. The medication is very hard to get and when they finally get it it’s really expensive. They said you know what, let’s pull a page out of the Uber playbook and let’s just cut out the big guys and go straight to the source. So that’s what they did, they got about 300 hospitals together, they went straight to the manufacturers of the medication and they said we want to get these generic medications on our own at a very reasonable cost so we can distribute it to our patients. And that’s exactly what they’re doing. The FDA is actually backing this as well, and it’s going to make available as this thing moves ahead, medication, much more medication, at much more reasonable pricing, which is something that’s really great news for all the other news that we’re hearing about medication prices being sky high and just ridiculous.

Lastly, we have out of Syracuse, New York, actually an LTC client that took over a healthcare facility Bishop Healthcare, Mr. Ed Farbenblum. When they came in, one of the first things they did was announce that they were committing to a $1.5 million salary raise for the nurses and the nurse’s aides in the facility. It made the local news, it was really exciting, and obviously getting started off on the right foot by having the staff happy and appreciative and that spreads to the rest of the facility. So great job Ed and we wish you the best of luck.

And I hope that these stories will keep you smiling, even if your friend sends you one of these-while you’re stuck under the snow, you’ll still be good to go. So until next time, thank you so much for watching and keep warm!


Trump Administration Eases Nursing Home Fines and Gives Long Awaited Relief to industry

The nursing home industry is reaping the benefits of a decision made by the Trump administration to ease up on the use of fines against nursing homes.The policy change will reverse the Obama administration’s policy of fining nursing homes for harming residents or placing them in grave risk of injury, part of President Trump’s resolve to reduce government’s role in federal bureaucracy, regulation and intervention on businesses.

The nursing home industry requested the reversal of these guidelines after 6,500 nursing homes were cited at least once for a serious violation since 2013, for reasons ranging from nursing home neglect to bedsores. As per the new regulations, nursing homes will see lower fines and in some cases possible exemption of amassed fines, even after a resident’s death.

Director of clinical standards and quality at the Centers for Medicare & Medicaid Services (CMS), Dr. Kate Goodrich, told the New York Times ( the past regulations were becoming a burden on health care providers.“Rather than spending quality time with their patients, the providers are spending time complying with regulations that get in the way of caring for their patients and doesn’t increase the quality of care they provide,” she explained.

Most recently, the average nursing home fine was $33,453. However, records show 531 nursing homes accumulated a combined total of $100,000 in fines. To make matters worse for the industry, in 2016 congress increased the fines to factor in years of inflation that were not previously accounted for.

The nursing home facility will now see some respite, as the new guidelines have been gradually implemented throughout the year. Some nursing homes could be protected from fines that have reached $20,965 or higher, the maximum per-instance fine.At the height of it, fines were being imposed daily to incite a quick solution.This became futile, David Gifford, the American Health Care Association’s senior vice president for quality,said, when the reason for the fine was often remedied by the time inspectors got to them.

The consequence of these fines started to weigh heavily on the nursing home and healthcare industry, which prompted The American Health Care Association’s group president, Mark Parkinson, to write in a letter to Trump in December 2016, “It is critical that we have relief.” It seems that relief has been granted.


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