Healthcare 80/20 Law Saves Consumers Over $1 Billion

Monday, June 25th, 2012
This post was written by Cheryl Miller

Consumers should check their mailboxes this August


Insurance policy holders just might have some extra spending money this summer.

According to the HHS, insurance companies that don’t meet the 80/20 healthcare rule of spending, which requires them to spend at least 80 percent of consumers’ premium dollars on medical care and quality improvement, and the remainder on administrative costs, must provide their policyholders a rebate for as much as $151 no later than Aug. 1, 2012. Consumers can expect a notice from their insurance company informing them of the 80/20 rule, whether their company met the standard, and, if not, how much of the difference between what the insurer did or did not spend on medical care and quality improvement will be returned to them.

Eligible healthcare organizations have already been reimbursed by the government for adopting EHRs for meaningful use. In fact, the CMS met its goal of getting 100,000 organizations on board with its EHR incentive program three months earlier than planned: more than 110,000 eligible healthcare professionals and over 2,400 eligible hospitals have received over $5.7 billion in payments as of the end of May. The end of 2012 was the original target goal. Officials hope the increasing use of EHRs will provide better patient care, cut down on paperwork, and eliminate duplicate screenings and tests.

Pharmacists could help manage the country’s healthcare costs if the results of a new study from Walgreens prove fruitful. Walgreens pharmacists trained over 4,500 patients starting self-injectable diabetes medication for the first time on appropriate injection technique, side effect management and the importance of adherence to therapy. Pharmacists also provided a follow-up assessment at the patients’ next refill meeting. Initial results showed that patients who received two counseling sessions with a pharmacist were 24 percent more adherent after 90 days and had an additional eight days of therapy compared to a usual care control group.

Employers, too, are looking for ways to keep their costs down, with employee healthcare plans a prime target. A study from J.D. Power and Associates reveals that almost 50 percent of employers might pursue alternate methods of employee healthcare coverage, including defined contributions, vouchers and exchange purchasing. A smaller percentage of fully insured and self-funded employers said they might discontinue sponsoring employee coverage completely. Details in this issue.

And lastly, we have a new survey on asthma management. Asthma drives a lot of healthcare utilization — half a million hospitalizations and nearly 2 million emergency department visits in 2009 alone. We invite you to share how your organization is managing asthma in the populations you serve by July 27, 2012. In return, we’ll e-mail you an executive summary of trends in asthma management.

All this and more in this week’s Healthcare Business Weekly Update.

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