Tag: 2018 News

CVS Health will introduce a new effort to help customers compare drug prices for more transparency at its pharmacy counters, ratcheting up pressure on the pharmaceutical industry and drug costs.

Pharmacists have long advised patients on whether a drug is covered by insurance or whether a cheaper generic is available. But CVS admits a more robust effort is needed by its drugstores and pharmacy benefit business at a time an increasing number of patients are paying more out of their pockets for drugs as high deductible plans have proliferated.

CVS said its new “CVS Pharmacy Rx Savings Finder” allows for a more seamless process, reviewing the patient’s “prescription regimen, medication history and insurance plan information.” CVS said its “Rx Savings Finder” will show its pharmacists through an interactive screen whether the prescribed medicine is on the preferred list of drugs in the patient’s health plan formulary and whether the drug is indeed the lowest option.

When a patient comes to the counter, he or she may have a certain drug covered by a health plan or employer, but that’s not always the lowest cost option. And patients with a high deductible aren’t always seeing the true prescription cost nor are they presented with options in a seamless effort to save money and provided resources if they are uninsured or if something can be saved by switching from 30-day refills to a 90-day supply.

“Armed with the information available through our Rx Savings Finder, our more than 30,000 CVS pharmacists can play an important role by helping patients save money on their medications, providing advice on how and when to take them, and ultimately helping them achieve better health outcomes,” CVS Health executive vice president of retail pharmacy Kevin Hourican said in a statement accompanying the announcement.

CVS’ new “Rx Savings Finder” is expected to ratchet up pressure on drug makers already facing pressure from consumers, employers and the Donald Trump White House on prescription costs. CVS has also introduced new ways doctors of their customers can see drug costs “in real time” through a program available in the physician’s office that allows prescribers to pick lower cost medicines.

Drug makers are already facing a wave of pricing pressure as CVS, which operates the drug benefit manager (PBM) Caremark, works to complete its acquisition of Aetna, the nation’s third-largest health insurance company. Aetna has more than 20 million health plan members and the two companies have said they want to increase transparency on a range of health services including drug costs as a larger company that pays for patient care.

Meanwhile, health insurer Cigna is buying Express Scripts, a large PBM, and Anthem, the nation’s second-largest health insurer, is launching its own PBM. UnitedHealth Group, the nation’s largest health insurer, operates the OptumRx pharmacy benefit manager.

An Oxnard business owner pleaded guilty Friday to four felony insurance code violations related to workers’ compensation payments, according to the Ventura County District Attorney’s Office.

Prosecutors said Victor Vega, 52, made fraudulent statements to reduce the cost of workers’ compensation insurance for his company Vega’s Cleaning Service.

He pled guilty to four felony violations of Insurance Code section 11760(a), making fraudulent statements to reduce the cost of workers’ compensation insurance.  As to each count, Vega also admitted special allegations that the crimes involved the taking of more than $200,000.

Prosecutors claimed that between December 23, 2010, and February 26, 2015, he systematically under reported more than $1 million in payroll to his workers’ compensation insurance carriers.

Vega will be sentenced on June 5, 2018, at 9:00 a.m.in Ventura Superior Court, County of Ventura, courtroom 12.

Vega faces a maximum of 10 years in state prison and could be ordered to pay up to $428,867.13 in restitution.

Ventura County officials are investigating a fired health care manager’s claims of irregular and fraudulent financial practices in the county’s public medical system. The allegations were cited in a $5.24 million retaliation claim filed against the county last year by Timothy Patten, chief deputy director and No. 2 person in the Ventura County Health Care Agency for most of 2016.

Patten said he had identified more than $100 million in activities he suspected were aimed at defrauding government agencies, the Ventura County Board of Supervisors, financial rating agencies and bondholders – a description the county’s chief financial officer found absurd. In Patten’s view, county officials had violated laws related to employment as well as abuse and fraud of Medicare and Medi-Cal, the government insurance programs that cover the bulk of patients in the Ventura County Medical Center system.

The VC Star reports that Patten settled with the county for $151,000 in severance, an agreement that required him to provide the factual basis for his allegations. A team of county legal and health care officials has been investigating the information in that document for the past seven months.

No evidence of broad losses, waste or fraud was identified in an analysis of the investigation that County Counsel Leroy Smith released Thursday. The team has not found any clear legal violations that need to be immediately corrected, based on a preliminary review of financial reports and interviews with 20 employees and officials with knowledge of the agency’s accounting practices, Smith wrote.

A few questions Patten raised about licensing issues at clinics and the size of physician payments did merit further review, Smith said.  The latter involved whether physician time sheets were accurate and some doctors were paid over the recommended rates and outside the normal review process, Smith’s report stated.  

Smith has said the accounting firm of Moss Adams and Huron Consulting Services, which the county has already retained to retool Ventura County Medical Center, may be asked to look at remaining issues. He expected the probe to be completed sometime this year.

Patten provided a five-page, typed statement to the county to back up his claim. The disclosures were based on more than 30 years as a health care executive in a variety of sectors and experience in investigations and compliance, he said. The document described what he called “accounting irregularities” and “potentially fraudulent accounting practices” in the system that is projected to spend $877 million this fiscal year.

Virtually all of his assertions were denied by Chief Financial Officer Catherine Rodriguez and Health Care Agency Director Johnson Gill, who said they indicated a lack of understanding of how public hospital systems work.  “There are basic principles that are totally missed here,” Gill said.

Patten said the budgeting process was incomplete and inadequate for such a large operation, the accounting methods were inconsistent and the agency moved money around to balance the books. At cash management meetings, finance staff would make up numbers to balance projections, he said. “Millions of dollars were added and subtracted without any backup or consent on the part of the operational leaders,” he wrote.

Rodriguez and Gill said the transfers are part of authorized shifts from the county to the state for the cost of the Medi-Cal program. Operational leaders were present at meetings where cash flow was discussed, Rodriguez said.

Smith agreed with Patten’s assessment that budgeting should be improved, saying it’s understood that the accounting systems and resources are not adequate for the demands of the large health system. But Patten’s claim that at least 10 clinics never had budgets seems to have no basis in fact, Smith’s analysis said.

Patten claimed it was also wrong to book a $15 million payment that was two years away. Rodriguez said the entry was justified because it was supported by law, could be estimated and was probable.

It appears Patten correctly pointed out that some clinics were not properly licensed, leading to billing problems. Gill said the situation at one clinic has been resolved but that the other in Santa Paula cannot be licensed until a state-authorized building is found. Smith doubted the county was submitting erroneous bills for payments to clinics without proper licenses but said the issue merited further review.

Patten said the financial position of VCMC was overstated because it failed to show a $15 million liability for drugs that were incorrectly given to patients who were not low-income. Gill said the problem was being corrected by the time Patten arrived in 2016.

Another section of his statement was devoted to what Patten called potentially fraudulent activities. He said the process physicians use for filling out time sheets violates federal standards because doctors are signing blank time sheets, then employees fill them in without knowing how much time the doctors have worked.

Cash transfers between the county and clinics exceed approved amounts and physician pay rates may exceed accepted standards, he said. Among other issues he reported: purchase orders from physicians do not follow federal guidelines, contract amendments are not being done in writing, and an unapproved accounting transfer of roughly $4 million was made from VCMC to the health care plan run by the county.

Smith said the issues had either been corrected, were not substantiated or were being addressed. He said the transfer Patten identified was approved by the Board of Supervisors.

Cal/OSHA cited California Premier Roofscapes, Inc. for repeat violations of fall protection safety orders and proposed $134,454 in penalties. The Escondido-based company was investigated and cited on six different occasions over the past four years for putting its workers at risk of fatal falls.

Cal/OSHA opened the most recent inspection in August of 2017 after receiving a report that workers were not wearing proper fall protection while installing tiles on the roof of a three-story Chula Vista home. Inspectors found that California Premier Roofscapes failed to ensure their workers were wearing safety harnesses and other personal fall protection. Employees were not properly trained on fall protection and roof work hazards.

“California Premier Roofscapes has repeatedly put its workers at risk of potentially deadly falls from heights, disregarding basic safety requirements to protect its employees,” said Cal/OSHA Chief Juliann Sum.

Cal/OSHA issued citations to California Premier Roofscapes for four violations including:

– One repeat-serious violation for failing to ensure that workers were wearing fall protection.
– One repeat general violation for failing to effectively implement and maintain a written Injury and Illness Prevention Program.
– Two general violations for not inspecting equipment prior to each use and inadequate training on fall hazards and protection.

The first inspection with California Premier Roofscapes was opened in October 2014 after Cal/OSHA received a complaint that employees were working on an Irvine roof with no fall protection. Cal/OSHA inspected a California Premier Roofscapes’ residential construction site in Azusa the following day after receiving a complaint involving an unsafe portable ladder.

The following month, Cal/OSHA investigated an accident involving a worker who suffered serious head and knee injuries after falling 15 feet from a ladder attached to scaffolding at a Carlsbad residential construction site.

In June 2015, Cal/OSHA opened an inspection and cited California Premier Roofscapes for a repeat serious violation after workers with no fall protection were reported on the roof of an Irvine construction site.

In March of the following year, Cal/OSHA inspected a report that California Premier Roofscapes’ workers wore harnesses but were not properly tied off to prevent falls from the roof of a Tustin construction site. California Premier Roofscapes was cited for two repeat violations, one serious and one general category.

Falls are the leading cause of death in construction nationwide. In California’s roofing industry, falls have caused nine deaths and 162 serious injuries since 2014.

A serious violation is cited when there is a realistic possibility that death or serious harm could result from the actual hazardous condition. A repeat violation is cited when the employer was previously cited for the same or a very similar violation and the earlier citation became final within the past 5 years.

The WCIRB Governing Committee voted to authorize the WCIRB to submit a mid-year pure premium rate filing to the California Department of Insurance (CDI).

The mid-year filing will propose July 1, 2018 advisory pure premium rates that average $1.80 per $100 of payroll which is 7.2% lower than the Insurance Commissioner’s approved average January 1, 2018 advisory pure premium rate of $1.94 and 19.0% less than the industry average filed pure premium rate as of January 1, 2018 of $2.22.

This proposed July 1, 2018 decrease follows six consecutive decreases since early 2015 and, if approved, will result in an average decrease of more than 35% from the January 1, 2015 advisory pure premium rates.

The Governing Committee’s decision was based on the WCIRB Actuarial Committee’s analysis of insurer loss and loss adjustment experience as of December 31, 2017 which was reviewed at public meetings of the Actuarial Committee held on March 19, and April 3, 2018.

The Actuarial Committee noted that cumulative injury claims continue to increase, particularly in the Los Angeles region. In addition, medical severities show signs of increase after several years of more modest severity trends driven by Senate Bill No. 863 and allocated loss adjustment expenses continue to increase.

Despite these upward pressures on system costs, the Governing Committee believed a reduction in advisory pure premium rates was warranted by the favorable loss development largely driven by significant increases in claim settlement rates, a sharp decline in lien filings following the implementation of Senate Bill No. 1160 and anticipated savings resulting from the new drug formulary.

The WCIRB anticipates submitting its filing to the CDI by April 10, 2018. The filing and all related documents will be available in the Filings and Plans section of the WCIRB website (wcirb.com) and the WCIRB will issue a Wire Story once the filing has been submitted.

Documents related to the Governing Committee meeting, including the agenda and materials displayed or distributed at the meeting, are available on the Committee Documents page of the WCIRB website.