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Mayo Clinic Limits Medicare/Medicaid!

From a disillusioned Washington Post:

Mayo Clinic Faulted for Limiting Medicare Patients

Critics Say Move Shows That Facility Is Not a Model for Health-Care Reform

By Alec MacGillis
Tuesday, October 13, 2009

The renowned Mayo Clinic is no longer accepting some Medicare and Medicaid patients, raising new questions about whether it is too selective to serve as a model for health-care reform.

The White House has repeatedly held up for praise Mayo and other medical centers, many of which are in the Upper Midwest, that perform well in Dartmouth College rankings showing wide disparities in how much hospitals spend on Medicare patients.

The model centers have capitalized on their status to insert into health-care legislation provisions that would result in higher Medicare payments for hospitals that do well on the Dartmouth rankings while punishing those elsewhere — mostly, big cities and the South — that spend the most per Medicare patient.

But some skeptics — health-care analysts as well as politicians and medical officials in states that would be hurt by Mayo’s proposals — argue that low Medicare spending by Mayo and others is driven by the lack of diversity and poverty in their patient population. They say Mayo’s low-cost image is belied by the high rates it charges insurers and private payers.

Mayo announced late last week that its flagship facility in Rochester, Minn., will no longer accept Medicaid patients from Nebraska and Montana. The clinic draws patients from across the Midwest and West, but it will now accept Medicaid recipients only from Minnesota and the four states that border it. As it is, 5 percent of Mayo’s patients in Rochester are on Medicaid, well below the average for other big teaching hospitals, and below the 29 percent rate at the other hospital in town.

Mayo officials said Monday it would look for other hospitals to take care of the 50 patients from Montana and Nebraska who have come to the hospital at least twice in the past two years. If there are none, the patients might qualify for charity care at Mayo.

Separately, the Mayo branch in Arizona — the third leg of the Mayo stool, with the Rochester clinic and one in Florida — put out word a few days ago that under a two-year pilot program, it would no longer accept Medicare for patients seeking primary care at its Glendale facility. That facility, with 3,000 regular Medicare patients, will continue to see them for advanced care — Mayo’s specialty — but those seeking primary care will need to pay an annual $250 fee, plus fees of $175 to $400 per visit.

Mayo officials said Monday that the two moves were "business decisions" that had grown out of longstanding concerns about what it sees as underpayment by Medicare and Medicaid. The officials said they were not meant to influence the national reform debate, in which Mayo has also been advocating against the creation of a government-run insurance option. But they said the moves were indicative of the need for the Medicare payment reforms it has been pushing in Washington.

"These decisions aren’t based on timing with what’s going on with the legislation," said Mayo spokeswoman Shelly Plutowski. "It simply is the reality of the health-care business, and how are we going to be able to continue our mission when these payments are so far below what it costs to provide the care."

Skeptics see the moves differently. As it is, they say, Mayo has been drawing a rarefied clientele by charging a premium to Medicare patients coming to Rochester from outside Minnesota. This month’s moves, they say, will result in a yet more affluent clientele, and given that Medicare costs correlate with poverty, Mayo’s spending data will look only better compared with others.

"If your institutions are located in the Bronx or South Central L.A. or other parts of the country with dense poverty, it’s hard to compare those patients . . . with places like Mayo," said Atul Grover of the Association of American Medical Colleges. "It’s not like they can just stop seeing Medicaid patients, because they live right in their area, and are not coming from hundreds of miles away. They’re located right in areas with dense poverty."

Mayo spokeswoman Jane Jacobs rejected this, saying that poverty rates can explain only a fraction of the Medicare spending disparities. "To use your patient demographics as an excuse for not getting better is outrageous," she said.

The skeptics also question Mayo’s argument that it needs to cut back on Medicare and Medicaid patients because those payments are so far below its costs. While Mayo is adept at limiting unnecessary procedures, they note, the costs of the procedures it does provide are high. By extracting such high rates from insurers and private payers, it can pay for top talent and facilities, thus raising its budget and its per-procedure costs.

By contrast, a recent report by the commission that advises Congress on Medicare found that hospitals relying most on Medicare and Medicaid, without a big private-payer base, report per-procedure costs in line with Medicare rates — suggesting that those hospitals can make do with Medicare payment levels.

Mind you, this is the same Mayo Clinic that Mr. Obama has cited as the model for his healthcare reform plan. A plan which ultimatley amounts to simply expanding Medicare and Medicaid to cover more people.

And here is his model healthcare provider turning away Medicare and Medicaid patients because their payments are too low for the hospital to be able to afford to treat them.

That doesn’t bode well for the future of hospitals in general if Obama-care becomes the law of the land.

And, lest we forget, the University Of Chicago Hospital, where Michelle Obama had her $317,000 a year no-show job, accused of sending away poor patients.

And not only was Mr. Obama’s wife involved, but so were his henchmen David Axelrod and Valerie Jarrett.

From the Chicago Sun-Times, and August of last year:

U. of C. shunning poor patients?

HOSPITAL DISPUTE | Obama’s wife, 3 aides tied to plan to free up space

August 23, 2008


Sen. Barack Obama’s wife and three close advisers have been involved with a program at the University of Chicago Medical Center that steers patients who don’t have private insurance — primarily poor, black people — to other health care facilities.

Michelle Obama — currently on unpaid leave from her $317,000-a-year job as a vice president of the prestigious hospital — helped create the program, which aims to find neighborhood doctors for low-income people who were flooding the emergency room for basic treatment. Hospital officials say such patients hinder their ability to focus on more critically ill patients in need of specialized care, such as cancer treatment and organ transplants.

Obama’s top political strategist, David Axelrod, co-owns the firm, ASK Public Strategies, that was hired by the hospital last year to sell the program — called the Urban Health Initiative — to the community as a better alternative for poor patients. Obama’s wife and Valerie Jarrett, an Obama friend and adviser who chairs the medical center’s board, backed the Axelrod firm’s hiring, hospital officials said

But when the Mayo Clinic does the very same thing — it’s evil.

Of course, we suspect that this criticism is more likely payback for the Mayo Clinic’s recent condemnation of the various Democrat healthcare reform proposals – after the Mayo Clinic had been touted by Mr. Obama himself.

From the Mayo Clinic’s Health Policy Blog:

Mayo Clinic’s reaction to House Tri-Committee bill

July 16, 2009

Although there are some positive provisions in the current House Tri-Committee bill – including insurance for all and payment reform demonstration projects – the proposed legislation misses the opportunity to help create higher-quality, more affordable health care for patients. In fact, it will do the opposite.

In general, the proposals under discussion are not patient focused or results oriented. Lawmakers have failed to use a fundamental lever – a change in Medicare payment policy – to help drive necessary improvements in American health care. Unless legislators create payment systems that pay for good patient results at reasonable costs, the promise of transformation in American health care will wither. The real losers will be the citizens of the United States.

Of course, if you cross Mr. Obama (and Mrs. Obama and Mr. Axelrod and Ms. Jarrett) you have to expect them to hit back ‘twice as hard.’

This article was posted by Steve on Tuesday, October 13th, 2009. Comments are currently closed.

5 Responses to “Mayo Clinic Limits Medicare/Medicaid!”

  1. BillK says:

    This is not at all surprising.

    I’ve mentioned before that if you ask any physician, they’ll tell you that Medicare and Medicaid don’t reimburse at rates high enough to keep the lights on.

    Thus why private insurers are charged so much; the costs that Medicare/Medicaid won’t pay must be made up somewhere.

    This is why under the Baucus plan, rates charged to private insurance will skyrocket.

    Under single payer, physicians’ offices and hospitals will simply go out of business or severely ration care.

    Just like they already do in Canada and the UK.

    • catie says:

      Well my doctor told me she has about 3 1/2 years worth of loans to pay off and that if this passes she is getting out of medicine.

  2. pdsand says:

    “Skeptics see the moves differently. As it is, they say, Mayo has been drawing a rarefied clientele by charging a premium to Medicare patients coming to Rochester from outside Minnesota. This month’s moves, they say, will result in a yet more affluent clientele, and given that Medicare costs correlate with poverty, Mayo’s spending data will look only better compared with others.”

    More of the unspoken class warfare that underlies the “healthcare reform” debate.

    Plus I must be missing something. Is the theory being bandied about that a hospital that spends less per patient on medicare/medicaid is somehow doing its job better? Is that really what it’s come down to? “We realize that medicare won’t pay you enough to cover your costs. What we want to know now is how well you deal with that fact, and how much you have to come out of pocket to provide treatment to a medicare patient.” And they can gather that data and expound on it with a straight face?

  3. Maethalion says:


    “Payment Cuts to Teaching Hospitals:Reductions to Medicare capital indirect medical
    education (IME) payments, which went into effect on Oct. 1[2009], will eliminate $1.3 billion
    over five years from payments to teaching hospitals. Despite numerous comment letters
    – from the AHA, 210 members of the U. S. House of Representatives and 51 members of
    the U.S. Senate – CMS moved forward with implementation of this rule. As a result,
    teaching hospitals in 2009 will receive half their capital IME adjustment; in 2010 and
    beyond, the adjustment is eliminated.”

    This is why Mayo has dropped Medicare Patients. Medicare CUT PAYMENTS to teaching Hospitals (like Mayo!)

  4. proreason says:

    but but but but, I though the Mayo Clinic was the model for patriotic health care, like we are all going to have in about a month.

    Instead, it turns out those capitalist bastards actually expect to get paid for what they do.

    If I was a Mayo executive, I wouldn’t be planning on any new yachts anytime soon.

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