Good news for patients on credit reports and maybe that Medicare hike

Patients battered by sky-high health care costs are getting a bit of promising news:

• One set of federal regulators may have jawboned the leading credit reporting agencies to deal better with how they tell lenders about individuals’ medical debt and its significance for their hiring, renting, borrowing, and more.
• And another set of federal regulators may be getting closer to rolling back one of the largest Medicare premium increases in recent memory.

Still, those receiving medical services, especially on an urgent or emergency basis, may need to mind their p’s and q’s to ensure they don’t get hit with supposedly banned surprise bills.

Let’s tackle the good news first, starting with upcoming changes by Equifax, Experian, and TransUnion. These outfits track consumers’ credit and provide analyses and reports on it — summarized in an all-important score or rating. The information holds huge sway over Americans’ lives, as it is used in everything from their prospective employment to apartments they can rent to loans they can get for cars, homes, and other debts.

The federal Consumer Financial Protection Bureau has a new chief, appointed by President Biden, and this leader with big clout on Americans’ finances has rumbled loudly at his start about credit agencies needing to treat the public better.

Voila, the agencies have announced they will wipe away 70% of what they now report as billions of dollars that consumers supposedly owe but already may have paid to doctors, hospitals, labs, clinics, and other health care providers. The agencies will stop reporting ticky-tack sums of medical debt less than $500. And they will extend to a year, up from six months, the time that consumers get to resolve medical debt with creditors before it appears negatively on agency reports.

Chi Chi Wu, a staff attorney at the National Consumer Law Center, told the New York Times this about the announced changes:

“This is huge, no doubt about it and it helps those people who have medical debt due to things like co-pays and deductibles, which is usually under $500.”

As a chorus of critics, including me, have pointed out, medical debt is a huge shame of the U.S. health care system, and it has only worsened during the coronavirus pandemic. The tens of billions of dollars supposedly owed to providers has become a crushing burden on millions of patients, with federal regulators recently reporting that 62% of bankruptcies are tied to medical debt.

Patients and their loved ones all too easily get overwhelmed by the costs of their care, especially if they are underinsured or uninsured and suffer major illness and injury. Consider the experiences of those with cancer, as reported by the American Cancer Society Cancer Action Network based on its recent survey of hundreds of cancer patients:

“Roughly half (51%) of patients surveyed say they have incurred cancer-related medical debt, the majority of whom (53%) report having their debt go into collections, and 46% of whom say the debt has negatively impacted their credit. Among those with medical debt, about half (51%) said they had balances of more than $5,000 and nearly a quarter (22%) had debt of more than $10,000.”

Medical debt, of course, disproportionately plagues the poor, those with lower incomes, and blacks and Latinos. It poses greater problems for residents of a dozen or so states, most in the South, that declined under the Affordable Care Act, aka Obamacare, to expand Medicaid, a coverage program for the working poor, poor, the aged, and the chronically ill and mentally ill.

Due to obdurate political partisans — Republicans, chiefly, but also some hold-out Democrats (Sens. Joe Manchin of West Virginia and Kyrsten Sinema of Arizona) — Congress has failed, thus far, to provide funding for key federal actions that help people with medical debt. These include expanding Medicaid to holdout states, as well as maintaining increased Obamacare support that has allowed record numbers of the working poor and middle class to get affordable health coverage on public insurance exchanges.

While health insurance is not a perfect shield against significant financial problems with medical care, it is one of the new ways that society spreads risk out and keeps consumers from getting crushed in the health care system.

As patient advocates and organizations like the nonprofit RIP Medical Debt have found in their efforts to erase consumers’ challenges with this issue, medical debt is particularly cruel and nonsensical. Doctors, hospitals, and others in health care often stick the poor and uninsured with the highest possible charges for services. They don’t always tell them what they are supposed to about charitable care and financial alternatives that might ease their burdens.

They also know that medical debts are among the toughest to collect. That’s because poor patients put a priority with their few available dollars to paying for essentials like food, rent, and utilities — not medical bills. So, providers end up turning to collection outfits that aggregate and sell medical debt, with these companies aware that they eventually will snag just pennies on the dollar. Health care providers, including some in Virginia, have taken withering criticism for their Draconian piling on and attempting to collect medical debt. They then have made it vanish with relatively effect.

For patients, however, the harms of negative credit reports can last for years hobbling them even as they may be debilitated by illness and injury and try to recover. Getting medical debt, especially when it has been repaid or resolved, off consumer records will be a boon to millions, experts say.

Critics say it also is more than the right thing to do. As the New York Times reported, the credit reporting agencies themselves and others, after scrutinizing consumer records have found that medical debt is a poor predictor of individuals’ handling of money and indebtedness (loans). Credit outfits have slowly moved to lessen the importance of this element of consumer reporting already. Geez, so why haven’t they gotten off their off-base report-enriching backsides to help Americans faster?

A break coming on Medicare premium hike?

The federal government stunned millions of seniors who get health coverage through Medicare, socking them with a 14.5% premium hikes, one of the largest in recent memory. Officials said the Part B increase, from $148.50 per month in 2021 to $170.10 in 2022, was necessary because the federal Food and Drug Administration, reversing its own independent experts, approved Aduhelm, a costly prescription drug targeting Alzheimer’s that has admittedly minimal outcomes.

Biogen, the maker of that medication, set a huge price for Aduhelm, not including the related costs for patients to take the drug. But after it was assailed by experts and snubbed by insurers, specialists, hospitals, and the Department of Veterans Affairs, Biogen was forced to slash its drugs’ cost. Aduhelm also provoked such an outcry that few doctors, hospitals, and patients have decided to try it.

That means the big Medicare premium hike may not be justified and could be reversed, pending auditors’ financial scrutiny of how events have overtaken the much-publicized, prospective, but undelivered profitability of Aduhlem.

Xavier Becerra, the head of the giant federal Health and Human Services agency, has pushed administrators of the Medicare system to consider rolling back their premium increase and has said that once U.S. figures on spending for Aduhelm are more finalized in mid-April, a decision will be made quickly.

A mid-year premium adjustment would be unprecedented, the medical news site Stat reported, noting that the course followed by Medicare could be breaking new ground for how the government deals with skyrocketing prescription drug prices.

Sneaking around the no-surprise medical bill law

The independent, nonpartisan Kaiser Health News service, which has provided its audience with a major public service in reporting on ridiculous medical bills, has posted an excellent report on avoiding shocks, still, with surprise medical bills.

Patients dread these too often jaw-dropping expenses, and Congress and the Biden Administration have moved, in rare bipartisan fashion, to quash them. But never get between a buck and too may doctors and hospitals. They are trying to figure ways to circumvent the ban on surprise medical bills.

The KHN report, in brief, warns patients that the no surprises law can’t quash all unexpected medical costs and it explains where these might occur, including at doctors’ offices, birthing centers, or most urgent care clinics, as well as with ground ambulances. Patients must be careful about reading and declining to sign paperwork presented to them and that may be waivers of no surprise billing laws. KHN advises how, even under duress, to deal with these noxious documents. Pay attention, too, to cost estimates health care providers must supply, as well as billing emails, KHN advises.

Good advice. In my practice, I see not only the harms that patients suffer while seeking medical services, but also their struggles to access safe, affordable, efficient, and excellent health care. This has become an ordeal due to the skyrocketing cost, complexity, and uncertainty of treatments and prescription medications, too many of which turn out to be dangerous drugs.

Doctors and other health care providers should make a reasonable return for their valuable medical services. But their relentless pursuit of profits, notably with excessive charges for caring for patients whose insurers may not include them in their provider networks, is about raking in bucks, not about treating the sick and injured in equitable fashion.

Big Pharma, of course, has written the book on maximizing its revenue while putting on shows of concern for patients. Federal regulators have been under fire for months for allowing Aduhelm to be prescribed for U.S. patients based on the barest evidence of limited benefit, then seeing the drug’s maker set a price far above what independent, expert analysts said would be reasonable.

The drug’s approval, though, put those in charge of Medicare and Medicaid in an uncomfortable spot, as these U.S. health programs typically cover medications approved by their federal regulatory colleagues. To their credit, the Medicare-Medicaid leaders called for more research on Aduhelm and limited federal coverage for it, as many private insurers also have done. Medicare’s administrators should rollback the premium increase related to Aduhelm and other prescription, especially as it hits a vulnerable group, many of whose members live on fixed incomes.

We have much work to do to improve our individual and collective health and to ensure that we aren’t exploited as patients by health profiteers.