Eating disorders often start at a younger age, but they don’t solely affect this population. Recognizing this, virtual eating disorder support company Equip announced Tuesday that it is now treating adults as well as adolescents. The company also announced an investment from General Catalyst, which helped expand its platform to adults. The amount was not disclosed.
“There is a very pervasive, really dense stereotype that eating disorders only affect 15- to 25-year-old thin, White girls,” said Dr. Erin Parks, chief clinical officer and co-founder of Equip, in an interview. “That is true, it does affect them. But it is not only them.”
She added that because so few people have access to treatment, many older adults have had their eating disorder for a very long time and need support.
San Diego-based Equip, which was founded in 2019, previously focused on those ages 6 to 24. The startup is now expanding to serve people of all ages. The virtual company operates in all 50 states and is in-network with several insurance companies, including Aetna, Elevance, Optum, Cigna and UnitedHealthcare. It connects patients with a care team that includes a therapist, dietitian, physician and peer and family mentor.
Different ages require different kinds of treatment, according to Parks. With its younger patients, the company uses family-based treatment, in which the family is brought in to help care for the patient. For adults, the company is using a method called enhanced cognitive behavioral therapy, which is a highly individualized treatment that addresses thoughts, feelings and behaviors affecting the patient’s eating disorder.
Parks said that when it comes to adults, individual treatment is often the best way to go because they may not have a support group. Sometimes when adults have been sick for a long time, they’ve “pushed away” a lot of their family and peers, or they may be too busy with work to build that support group.
There are other virtual solutions for eating disorders as well, including Arise and Within. Arise offers coaching with a care advocate who has lived experience with an eating disorder, therapy, nutrition counseling, group support and psychiatry. Within provides access to a care team that includes dietitians, therapists, nurses and peers.
The expansion to adults was powered by a recent investment by General Catalyst. In total, Equip has raised more than $75 million. With the funding, the company brought on a new president, Nikia Bergan. It also updated its technology and trained its providers in treating adults. In addition, it’s planning to use the funding to gain more Medicaid contracts, Parks said.
Equip considers itself an alternative to brick-and-mortar eating disorder treatments, which often require patients to stay at the treatment facility for a certain period. Parks said the benefit of a virtual program is that patients can be treated as they live their normal lives.
“[If you take] someone out of their life and give them a bunch of skills, then all of the sudden they plop back into their life and have all these triggers that they aren’t equipped to deal with,” Parks argued. “One of the great things about getting treatment while still being able to go to school, still being able to go to your job, still being able to parent your kids, is that you get to work with your providers on your real-life triggers as they come up.”
Parks is likely looking to replicate the positive results it claims to have achieved in the adolescent population in this new, adult population. In its annual outcomes report published earlier this year, the company cited that 81% of its adolescent patients reached or maintained their target weight within one year.
Photo credit: Bohdan Skrypnyk, Getty Images
The commercial market has been slower to adopt value-based care than the public market, but there are ways to move the process along successfully, executives said Monday.
During a panel at the Oliver Wyman Health Innovation Summit 2023 held in Chicago, healthcare leaders discussed the challenges and opportunities in advancing value-based care in commercial health plans. The panelists were Mark Hansberry, senior vice president and chief marketing officer of HealthPartners; Ellen Kelsay, president and CEO of Business Group on Health; and Tiffany Albert, senior vice president of health plan business at Blue Cross Blue Shield of Michigan.
Bloomington, Minnesota-based HealthPartners, which is an integrated healthcare organization serving more than 1.8 million members, has had some success with value-based care in the commercial space, Hansberry claimed. He shared five rules for scaling value-based care in the commercial market:
1. Payers and providers in a value-based arrangement need to have a shared understanding of what value is for patients, Hansberry said.
“You have to have a universal definition of what value means so that when clinicians look at you as a payer … they need to acknowledge that what you’re saying a clinical outcome is is actually a good clinical outcome, a good measure of performance,” he stated.
2. It’s important to ensure that the providers in the value-based arrangement are able to and willing to take the risk associated with value-based care.
“Most care systems weren’t built to actually manage risk,” Hansberry said. “That wasn’t their job. Their job was to take care of sick people. Now we’re asking them to do something else. How do you actually support those individuals on that journey?”
3. Payers need to support providers engaging in value-based care with “real-time, actionable data and consultation,” Hansberry said.
“It’s not just a data dump or a big Excel file that you pass over and you say good luck with it,” he stated. “Because, by the way, if they perform well in those value-based contracts, you do too as a payer. You want them to perform well. So you want to provide them with good, insightful, actionable data that’s risk-adjusted, that is connected to their practice — not just an amorphous health system — but to their practice so they can take action on those insights. But then you also want to supplement that with that consultation along the way.”
4. The incentives in the value-based contract must be aligned to “enable that [provider] to reap the benefits of the value that they’re creating for those members,” according to Hansberry.
5. Ultimately, a value-based contract comes down to trust between all the parties. But Hansberry noted that this is easier for HealthPartners as an integrated health system.
“We’re fortunate because we’re both a health plan and a care system,” he said.
He added that success in value-based care doesn’t happen overnight, which is partially why it’s difficult to scale.
“It takes time to build trust,” Hansberry stated.
Photo: atibodyphoto, Getty Images
It’s no secret that hospitals and health systems have been facing severe financial woes in the past couple years. These money problems have forced many providers to make what they likely felt were tough but necessary choices — such as shuttering underperforming service lines, laying off staff and using debt collection agencies to obtain payment from patients.
Some of these tactics have even invited negative scrutiny. However, a new report argued that commercial payers should shoulder some of the blame when it comes to how hospitals are managing their dire financial circumstances.
Compared to government payers, commercial payers take significantly longer to pay hospitals and deny claims at a higher frequency — often without a justifiable reason to do so — according to the report published by consulting firm Crowe. These delays mean that hospitals are waiting longer than they need to receive commercial payments — during a time when they need cash flow to be expedited, not needlessly delayed, the report said.
Crowe analyzed data from the more than 1,800 hospitals that use its revenue cycle analytics platform and found that about 45% of a typical hospital’s patient population is covered by a commercial health insurance carrier.
Commercially insured patients have conventionally been thought of as hospitals’ preferred population. This is because hospitals can negotiate prices with commercial payers, and these payers usually pay higher rates than government payers like Medicare and Medicaid. For the average net revenue per inpatient case, commercial plans pay $18,156.50 compared to $14,887.10 from Medicare. For outpatients, commercial plans pay $1,606.86 for the average patient case, compared to $707.30 paid by Medicare.
Reimbursement rates may be higher among commercial payers, but getting them to pay in a timely manner is an entirely different story, per the report. During the first quarter of this year, commercial payers initially denied 15.1% of inpatient and outpatient claims compared to 3.9% for Medicare over the same period, according to the report.
Crowe analyzed the claim denial category of prior authorization and precertification denials. These occur when a payer denies a claim based on their decision that a provider did not get prior approval for care before it was delivered or that the care rendered wasn’t necessary based on the patient’s medical diagnosis.
Last year, the prior authorization/precertification denial rate for inpatient claims among commercial payers was 2.8%, up from 2.4% in 2021. This rate increased to 3% during the first three months of 2023, but the denial rate for traditional Medicare was just 0.2% during the same period.
Another claim denial category that the report examined is the request for information (RFI). RFI denials happen when a payer decides not to process a claim because it is missing some type of required documentation, such as a signature or copy of the medical record. In this category, commercial payers’ denial rate is 12 times higher than Medicare, the report found.
Most of the claims that commercial payers deny eventually get paid. However, the administrative effort required for hospitals to turn an initially-denied claim into a payment costs a good deal of time and money — two things in short supply at hospitals
To obtain payment from a denied claim, a provider must investigate the claim, determine what they have to do to rectify the problem and resubmit the claim — a process that can take weeks — said Colleen Hall, the managing principal for Crowe’s healthcare consulting group, in a recent interview. This process creates “an aging accounts receivable situation” for the provider and delays them from receiving much-needed cash.
“There certainly are several for-profit insurers out there. I won’t name names, but I think that those for-profit entities are in direct conflict with the nonprofit hospitals. I don’t know what goes on in the for-profit payer side of things, but could there be actions that they’re deploying to delay payments? Potentially. There have certainly been denials that our clients, as providers, have to manage only to find were denied for no reason,” Hall declared.
In the first quarter of this year, about a third of the claims that providers submitted to commercial payers took more than three months to get paid, the report found.
It’s difficult for hospitals to gain steady financial footing when the payers that have the best reimbursement rates are holding onto a third of their claims payments for more than 90 days, Hall pointed out.
Photo: santima.studio, Getty Images
Oshi Health — a virtual care provider for patients with digestive disorders — announced its first contract with a commercial insurer on Thursday. The New York-based company has entered into a value-based contract that provides Aetna members with in-network access to its specialized treatment.
The partnership comes nearly two years after CVS Health, Aetna’s parent company, invested in Oshi as part of the startup’s Series A fundraising.
Founded in 2019, Oshi built a virtual-first care platform designed to help patients achieve lasting control over chronic digestive conditions. The company hires gastroenterologists, nurse practitioners, dieticians and GI-specialized behavioral healthcare providers to quickly reach a diagnosis and guide individualized treatment. Patients are also assigned a care coordinator, who can help them find in-network providers if they need services like a colonoscopy or endoscopy.
The startup prides itself on providing whole-person care, which includes often-neglected dietary and psychosocial interventions, Oshi CEO Sam Holliday said in a recent interview.
“Over the past decade, there’s been a recognition that many gastrointestinal disorders are actually triggered by the signaling between your gut and your brain. A whole class of GI conditions has actually been renamed as disorders of the gut-brain interaction, or DGBIs,” he explained. “Things like gut-directed cognitive behavioral therapy can really reframe patients’ thought patterns and dampen the brain signaling that causes their symptoms, making symptoms feel less severe.”
Dietary interventions and behavioral therapy are proven methods to alleviate GI patients’ symptoms, and they’re often more effective than medication, Holliday pointed out. But these services are rarely available to GI patients because they haven’t been reimbursed historically, he added.
That’s why these interventions are a core part of the care patients receive under Oshi’s new contract with Aetna.
“One of the challenges in GI is that there aren’t very good quality measures. Really, the main things we focus on as a country is getting people screened for colorectal cancer, But we don’t really have measures for what matters to patients, who are the people suffering. What we think is the best measure to use is symptom control,” Holliday explained.
The root cause of GI symptoms usually stems from dietary or behavioral health reasons, and traditional, medication-centric GI care does not address those underlying causes, he declared. Patients end up continually seeking care — and driving costs up — because their symptoms are still bothering them. Through Oshi’s value-based contract with Aetna, “the value aspect being measured is Oshi’s ability to reduce that utilization downstream,” Holliday said.
Oshi will measure its care teams’ ability to sustainably control patients’ symptoms through a mix of medication, dietary adjustments and gut-brain psychology interventions. The company will track metrics such as reductions in emergency department visits and patients’ reported symptoms.
“We get paid a certain amount as we’re providing the care. Then, if we’ve gotten to a good level of patient satisfaction, symptom control and reduced utilization at the end of the measurement period, we have a bonus opportunity. And if we don’t achieve certain levels, there is a downside,” Holliday explained.
Aetna shares in the upside if Oshi hits its goals, but the payer is protected against potential downside. If Oshi doesn’t achieve as good outcomes as the partners had hoped, Aetna won’t have to pay the startup the full amount for care, Holliday declared.
The partnership is in its first phase, meaning Aetna members can access Oshi’s services in the following six states: Florida, Maine, Massachusetts, Ohio, Pennsylvania and Texas.
Photo: TLFurrer, Getty Images
Paragonix Technologies — a company that launched in 2010 as a response to the lack of innovation in the donor organ preservation and transport process — closed a Series B funding round on Tuesday. The $24 million round was led by Signet Healthcare Partners.
The Cambridge, Massachusetts-based company provides transplant centers and organ procurement organizations (OPOs) with medical devices designed for the preservation and transportation of donor organs.
The traditional method of preservation requires the organ to be transported in a cooler of crushed ice. Due to unstable temperatures, many facilities that receive organs preserved in this manner report that they arrive frozen and damaged, said Paragonix CEO Lisa Anderson.
“Paragonix determined there was an opportunity for a more scientifically reproducible, measurable and reliable solution to transporting an organ from a donor to recipient,” she said. “We set out to create a new standard for organ preservation and transport that would provide the care and quality of handling commensurate with transporting such a valuable gift and improve patient outcomes worldwide.”
Paragonix’s devices are made from a series of interconnected systems that work together to provide a cool and sterile environment within a consistent range of 4-8° Celsius. The company sells three devices, each designed for a different organ (heart, lung and liver). All have been cleared by the Food and Drug Administration.
Each device works slightly differently based on specific user needs related to the organ type, Anderson said. For example, the heart preservation device has pouches filled with proprietary cooling solutions that keep the organ at optimal temperatures during transport. The heart is contained within a nested canister and is then housed in a wheeled shipper container that works to protect and insulate the inner contents.
All of Paragonix’s devices display the organ’s temperature while it is being transported. They also use bluetooth monitoring and tracking technology to allow surgeons to track the organ’s exact location throughout its journey, even in flight, Anderson pointed out.
Paragonix markets and sells its devices to transplant centers and OPOs across the U.S. and Europe. Last year, over one in five thoracic donor organs transplanted in the U.S. were preserved using a Paragonix device, Anderson declared. She also said that 19 out of the 30 largest U.S. heart transplant programs rely on Paragonix devices to safely preserve, track and transport organs to their intended recipients.
There are a few other companies that make devices to preserve donor organs, such as Organ Recovery Systems and Bridge to Life. But Anderson contended Paragonix’s devices are easier to use.
“Most other organ preservation devices are extremely complicated, labor intensive and require special personal or extensive training, while Paragonix’s devices are lightweight, user friendly, and a user can be trained in less than an hour,” she declared.
Anderson explained that her company’s main competition is the legacy way of transporting organs, as many organizations still receive damaged organs that were transported using the over-ice method. The medical industry needs to move away from this method of organ preservation because devices like the ones that Paragonix sells are clinically proven to improve patient outcomes and reduce the risk of post-surgical complications, she declared.
Picture: Getty Images, ThomasVogel
Mihir Tanna, Associate Director, S K Patodia & Associates (external link), a chartered accountants firm that offers consultancy, audit and tax services, answers your tax queries.
Gulshan Singh: If I buy a property from my savings by making online payment to seller, in name of my daughter-in-law and she gives it on rent, will she or I have to show it as my income in my income tax return.
If property is taken in joint name of my daughter-in-law (who is working) and in my wife’s name (who is not working and has another property), how should income tax return be filed by them or rent will have to be shown in my income tax return (50% of my wife’s share by clubbing provision) or 50% by my daughter-in-law in her return or 100% by me in my income tax return? Thanking you very much
Mihir Tanna: If an individual acquires asset in the name of his/her son’s wife or spouse, clubbing provisions of income tax will be applicable.
It will considered as transfer of asset for inadequate consideration and income from such asset will be clubbed with the income of the individual, who actually spent money (transferor being father-in-law/husband in our case).
Swadhin Sahoo: I am a senior citizen retired pensioner.
I had intention to sell both my properties located in one town and to invest in a property in another town where I wanted to settle in my retired life. I wanted that the sale proceeds of my two properties should be almost same as the purchase value of a single property in another town to settle there.
I had bought a property in 2015 at Rs 40 lakh in my single name and sold in Feb 2022 at Rs 52 lakh. The buyer deducted 1% TDS and filled in form 26QB and I got form 16(B) from buyer and details of TDS are seen reflected in my Form-26AS.
Thereafter, my second property that I had bought @Rs 7.3 lakh 20 years back, was attempted to dispose, but did not materialise till now.
Anyway, I bought a 5-year-old jointly owned property from a couple at Rs 80 lakh in June 2022 and deducted 1% TDS (@0.5% from each owner), filled in Form 26QB and provided form 16(B) to the sellers.
So, I invested the sale proceeds of my first house ‘within a year’ of its disposal, in buying a house from Long Term Capital Gain point of view.
My IT Return for AY 2022-23 was filed in July 2022 and it got approved. The 1% TDS deducted by buyer on my first property sale got refunded/ adjusted.
I am still trying to sell my second property ‘within one year’ of buying the June, 2022 property. I want to do this to take benefit of Long Term Capital Gain Tax.
I want to know whether I am going to get the IT benefit by selling my second property ‘within one year’ of purchase of my June 2022 property?
I am more eager to know how sale of first property in financial year 2021-22 (Feb 2022), purchase of a property in FY 2022-23 (June 2022) and again sale (proposed) of second property, (all within 2 years from LTCG point of view) are shown in my next IT Return (AY2023-24)
I am eager to hear from you, Sir!
Mihir Tanna: If person wants save tax on capital gain, person should acquire another residential house within a period of three years from the date of transfer of the old house or should construct a residential house, within a period of one year before or two years after the date of transfer of old house.
But law is not clear on the matter of claiming exemption on same property against capital gain earned on two separate properties. If claim is made in ITR, it can be subject to litigation.
Thus, considering your post retirement planning, it is not advisable to claim exemption in the subsequent year.
Seshasayee Krishnan: Sir I am a sr ctzn of 77 yrs. I missed my ITR filing in July 31st for AY 2022-23 and hence I have to file belated return with penalty. As per yr statement penalty is UP TO Rs 5000. If it is up to Rs 5000 does it vary from person to person. Please clarify. Also as a sr ctzn I missed deadline on July 31, 2022 due to tech glitches. Can I request ITO to consider for waiver of penalty as the delay is not intentional. Please examine. Thank you.
Mihir Tanna: The due date for filing returns for FY 2021-22 is 31st July 2022. If you miss filing ITR by the due date, you can file the belated return by 31st December 2022. However, you are required to pay the penalty for late filing.
The maximum penalty of Rs 5,000 will be levied if you file your ITR after the due date 31st July 2022 but before 31st December 2022.
However, there is a relief given to small taxpayers — if their total income does not exceed Rs 5 lakh, the maximum penalty levied for delay will be Rs 1,000.
There is no provision under income tax to waive late filing fee.
Read more of Mihir Tanna’s responses here.
Note: The questions and answers in this advisory are published to help the individual asking the question as well the large number of readers who read the same.
While we value our readers’ requests for privacy and avoid using their actual names along with the question whenever a request is made, we regret that no question will be answered personally on e-mail.
Do you have any personal income tax query?
Please mail your queries at getahead@rediff.co.in with the subject line ‘Ask Mihir’.
Mihir Tanna, Associate Director, S K Patodia & Associates (external link), a chartered accountants firm that offers consultancy, audit and tax services, will answer your queries.
Pravin M T: A company invests in stocks on 1.5.21 for Rs 30 lakh, the market value of those equity shares is 20 lakh as on 31.3.22. Can a company debit profit loss a/c on 31.3.22 for 10 lakh?
Mihir Tanna: In case of Investment in equity shares, it is shown at cost in the balance sheet and notional loss/gain is not allowed as deduction under Income Tax. For accounting entries and impact in the books, please consult your statutory auditor who can advise after considering applicable accounting standards.
Kannan Thangaraj: I have taken insurance with Kotak Mahindra about five years back sum assured being Rupees four lakh fifty thousand only. I pay yearly premium of Rs 50,500. I received in this financial year money back of Rs 60,000. I want to know whether this sum received as money back is taxable.
Mihir Tanna: Where the premium paid, is more than 10% of the sum assured, amount received from a life insurance policy, is fully taxable. Further, in case of ULIP plans, if policy is acquired after 1st February 2021 and single/aggregate premium paid is more than 2,50,000; amount received under policy is taxable.
In your case, if you fulfill both the conditions, amount received will not be taxable.
Vivek Etelvino Rodrigues: My mother, a housewife and a non-tax payee senior citizen had only one FD on her name from 10.02.2011 to 09.02.2019. of Rs 90,136 with a maturity value of Rs 2,06,538 at 10.5%. However, when the FD was automatically renewed the bank renewed it for only Rs 1,76,550. She did not realise it and this year she realised it and approached the Bank. The Bank says that they cut the amount as TDS as she had not submitted her PAN as per the rules then. She had no PAN card then but subsequently she did get a PAN card. Can she get the deducted amount and if so how?
Mihir Tanna: A refund of TDS is possible only by way of filing an Income Tax Return within the specified due date. It is understood that the bank had reinvested the FD maturity amount (net of TDS) in February 2019 itself, ie, in FY 2019-20 and the due date of filing Return/ belated return for the said year has already passed long. Therefore, it is not possible to file a Return for FY 19-20, hence, no refund can be claimed.
However, in case of substantial amount of refund, it is advisable to file condonation application with jurisdictional Commissioner of Income Tax who can allow you to file revise return if reason for non-filing of correct income tax return is reasonable/genuine.
Read more of Mihir Tanna’s responses here.
Please mail your queries at getahead@rediff.co.in with the subject line ‘Ask Mihir’.
Note: The questions and answers in this advisory are published to help the individual asking the question as well the large number of readers who read the same.
While we value our readers’ requests for privacy and avoid using their actual names along with the question whenever a request is made, we regret that no question will be answered personally on e-mail.
Do you have any personal income tax query?
Mihir Tanna, Associate Director, S K Patodia & Associates (external link), a chartered accountants firm that offers consultancy, audit and tax services, will answer your queries.
Please mail your queries at getahead@rediff.co.in with the subject line Ask Mihir.
Somaskandan Hariharan: I request you to clarify the following point.
I am having a housing loan with an outstanding principal amount of Rs 10 lakh (The flat where I am presently residing. Housing loan was taken during the year 2017). I got capital gain by means of sale of other flat to the tune of around Rs 80 lakh. By repaying the outstanding housing loan of Rs 10 lakh can I save myself from paying capital gains tax?
Mihir Tanna: Repayment of housing loan is allowed as deduction in two parts. First repayment of principal can be claimed u/s 80C (up to 1.5 lakh) and second payment of interest which can be claimed as deduction. Interest deduction is allowed subject to certain limits depending on the fact that house property is used for self-occupation or given on rent.
In addition to that you can save tax on capital gain by investing in another house property or you can acquire specified bonds, if you fulfill other specified conditions.
Bhalwant Singh Raju: Re. Revision in Form 67 for AY 2019-20 & AY 2020-21 and submission of request for Rectification. Erroneously, I have claimed the Tax Relief under section 91, instead of section 90/90A Under DTAA with Canada, which naturally have not been given by IT Dept and Assessment carried out under 143(1).
It is a plain typographical error on my part.
Can the error be corrected by revising Form 67 and submitted with a Rectification request to IT Dept? Please suggest a way out.
Mihir Tanna: Mistake which is apparent from the records can be rectified by Income Tax Department and mistake which requires debate, elaboration, investigation, etc. cannot be rectified. Accordingly, if you can specify in the application that section 91 of Income Tax Act 1961 provides for Unilateral Relief which states that when there is no DTAA between two countries, you have certain income (which is doubly taxed) from Canada with whom India has signed DTAA and section 91 is not applicable in your case. Accordingly, you can request to assessing officer that inadvertently while filing Form 67, you have selected wrong section, as it is mistake apparent from the records, kindly consider revised Form 67 and pass rectification order u/s 154 of the income tax act.
Sadruddin Khoja: I am a retired govt. servant and get pension. Also I get Interest from Deposits, Saving and Acc. Int. I show this income in my Income Tax returns filed in Form ITR-1 SAHAJ. During the current Financial Year I have received the maturity amount of my PPF maintained in the Post Office. Out of the amount received I have a certain amount given as a gift to my spouse. She has invested the said amount received by her from me as a gift in the SCSS A/C and gets interest on that amount.
I want to know whether the amount she receives as interest from the amount given by me is to be included in my income and to be shown in the Income Tax Return. If so, at what place i.e. in which column?
I have to show the income so included as I do not see such places or column. In which I have to indicate this amount Sr. No. B3 Income from Other Sources along with the Interest received by me from Deposit etc.
Since the amount of interest received by my spouse is included in my Income, Whether the said amount is also to be shown in her Income Tax Return or otherwise? As if it is to be shown in her return also then there will be duplication.
This clarification is sought as I file my return myself and since the notice I or my wife may not get. I hope you will kindly guide me in this regard and oblige us.
Thank you in advance.
Mihir Tanna: If taxpayer directly or indirectly transfers an asset to spouse for inadequate consideration than Income from such asset is clubbed in the hands of the transferor. Transferor (taxpayer) should show such income in Schedule SPI of Income Tax Return filed by such tax payer in whose hands income is clubbed. No need to show said income in the income tax return of spouse.
Read more of Mihir Tanna’s responses here.
Note: The questions and answers in this advisory are published to help the individual asking the question as well the large number of readers who read the same.
While we value our readers’ requests for privacy and avoid using their actual names along with the question whenever a request is made, we regret that no question will be answered personally on e-mail.
The rift between hospitals and commercial insurers is age old. But a new survey shows the relationship isn’t going to improve any time soon.
The American Hospital Association (AHA) survey, released Wednesday, found that 78% of hospitals and health systems said their relationship with commercial insurers is getting worse. Less than 1% said their relationship is improving and the rest said it has stayed the same.
The survey included 304 respondents representing 772 hospitals. All of the respondents are members of AHA.
One of the main culprits behind the worsening relationship appears to be certain practices of commercial insurers, such as prior authorization. The report found that 95% of hospitals and health systems said staff time spent seeking prior authorization approval is increasing. Meanwhile, 62% of prior authorization denials are eventually overturned, the report found.
Aside from time spent on administrative procedures, costs may also be a factor in the relationship souring. A whopping 84% said the cost of complying with insurer policies is also increasing.
“Misuse of utilization management tools like prior authorization has several negative implications for patients and the health care system,” AHA said in the report. “Prior authorization denials can result in delays of necessary treatment for patients and ultimately lead to unexpected medical bills. The extensive approval process that doctors and nurses must go through adds wasted dollars to the health care system through overuse of prior authorization, inefficient submission processes, excessive requests for unnecessary documentation and the need to reprocess inappropriate payment and coverage denials.”
AHA also takes issue with claims denials, stating that commercial health insurers are “increasingly delaying and denying coverage of medically necessary care.” However, 50% of claims denials that are appealed are overturned, AHA said.
There are financial consequences to these delays and denials, AHA stated. The survey found that 50% of hospitals have more than $100 million in accounts receivable for claims that are older than six months, totaling $6.4 billion in delayed or potentially unpaid claims among the 772 hospitals in the survey. Another 35% of respondents said they’ve lost $50 million or more in revenue because of denied claims.
“These payment delays and denials for medically necessary care have serious implications for the financial stability of health care providers and compound fiscal challenges plaguing our health care system,” AHA said.
The report also provided several policy recommendations, including streamlining the prior authorization process and increasing oversight on insurers. Additionally, the organization sent a letter to the Department of Health and Human Services and the Department of Labor, calling for action against commercial payers.
“Health care coverage must work better for patients and the providers who care for them. We urge you to take additional steps to ensure adequate oversight of commercial health plans, including those offering Medicare Advantage plans, this open enrollment season,” the letter stated. “Individuals and families should feel assured that the plan they choose during open enrollment will actually be there for them when they need care.”
America’s Health Insurance Plans (AHIP) declined to comment publicly on AHA’s survey, but previously told MedCity News that commercial insurers’ practices are needed to reduce expenses for patients.
“Health insurance providers advocate for the people they serve by ensuring that the right care is delivered at the right time in the right setting — and covered at a cost that patients can afford. Prior authorization prevents waste and improves affordability for patients, consumers, and employers,” Kristine Grow, AHIP spokesperson, previously said. “Health insurance providers have a comprehensive view of the health care system and each patient’s medical claims history and work to ensure that medications or treatments prescribed by clinicians are safe, effective, and affordable for patients. This results in better outcomes and lower costs for patients.”
Photo: santima.studio, Getty Images
From left: Ayush Jain of Revolution’s Rise of the Rest Seed Fund; Ayse McCracken of Ignite Healthcare and INNOVATE Health Ventures; Max Rosett of Research Bridge Partners; and Dr. Hubert Zajicek of Health Wildcatters
When it comes to investment, including healthcare and biotech, companies in the Bay area, Boston and New York tend to get the lion’s share of venture capital. But in recent years there’s been greater attention to investment in companies beyond those regions. The Covid-19 pandemic also played a significant role as people were forced to limit travel and use Zoom to connect their In a panel discussion at INVEST Digital Health, healthcare and life science investors discussed investment strategies and why they are placing their funding bets in states like Texas, Indiana, Utah and Arkansas.
The panel, Investing between the coasts, moderated by Dr. Hubert Zajicek, CEO, partner and co-founder of Health Wildcatters, offered a window into how investors are finding companies that match their investment theses, even in states that are not thought of as startup hubs. The panel was sponsored by Lyda Hill Philanthropies.
“We were the most active investor in Arkansas last year,” said Ayush Jain, a senior associate with Revolution’s Rise of the Rest Seed Fund. The fund, which was started by Steve Case of AOL fame, has made investments in more than 200 companies in 40 states since 2017.
The video platform Zoom has made an indelible impact towards democratizing investment across the country, according to Ayse McCracken, a founder and board chair with Ignite Healthcare in Houston and president of eNNOVATE Health Ventures. Ignite focuses on women-led digital health and medical device startups, while eNNOVATE invests in a broad array of startups across the continent of Africa.
McCracken said it was one of the unintended consequences of the pandemic.
“[Zoom] has allowed us to connect with entrepreneurs all across the country and all across the world and match them with mentors across the U.S. All of a sudden, we were working with an expanded ecosystem coast to coast, and we were working with startups coming from all across the country. We have eight of the 22 companies [in our latest cohort] that are coming from the Texas market — San Antonio, Austin, Dallas and Houston, which is great. We’d love to see Texas continue to grow. Denver has been another location where we’re seeing a number of entrepreneurs come from, also Minneapolis.”
Max Rosett, a principal with Research Bridge Partners, conceded that Zoom has been useful for connecting with and keeping in touch with portfolio companies in areas that would have otherwise been costly to travel to from his offices in Salt Lake City.
“This is going to sound incredibly trite and yet it’s incredibly real. Now that it’s okay to have board meetings over Zoom, life is much easier,” Rosett said.
Research Bridge Partners, which focuses on life science companies, is trying to chip away at what it refers to on its website as the “geographic misalignment” of venture capital in the Bay area and Boston. It also calls attention to trends among larger venture capital firms of creating lab-to-market systems to advance ideas towards financial liquidity that make it tougher for midcontinent principal investigators to access, because these firms favor institutional brand and geographical proximity to their offices.
Although everyone is pleased that the worst of the pandemic appears to be over, Zajicek said that in the past two years the accelerator has received a record number of applications from all over the world, which has spurred the development of a hybrid program combining in-person and Zoom-based interactions with startups in its cohorts. It has added an international flavor to its startup portfolio. Add to that the accelerator’s advantageous base in Dallas, in close proximity to an airport with the most direct flights in the country.
“It has flattened the world in non-trivial ways,” Zajicek said.
Health Wildcatters recently moved its offices to Pegasus Park, a 13-floor building that offers lots of space for healthcare and life science startups to work and connect with investors and collaboration partners.
Jain agreed that Zoom can offer a useful complement to in-person meetings and has made it easier to foster relationships with startups. He emphasized the importance of regional startup incubator and accelerator spaces, which frequently host demo days and other events to bring investors and startups together. They can also prove useful for investors from out of town seeking to plug into the regional startup ecosystem.
“If there’s a city that you gravitate towards, whether it’s because of a particular industry strength, or a personal connection, those are factors to leverage when you build relationships in those cities and find deal flow there,” Jain said. “That’s something we lean on a lot. We’re not lead investors. So we rely on finding opportunities to invest in startups, mostly through local regional investors, accelerators, incubators, places like Pegasus Park, where there’s a ton of companies. There’s some institutions in other cities like this. I think finding those and really honing in on them and building relationships is important.”