Euthanize This (Merger)

[Celerity]

https://prospect.org/health/2023-12-01-euthanize-this-merger/



Earlier this year, a federal judge in Washington state unsealed a whistleblower lawsuit I haven’t been able to stop thinking about. The plaintiff was a nurse practitioner named Maxwell Ollivant who worked from 2019 to 2020 for Optum, the physician services subsidiary of the health insurance giant UnitedHealthcare, as a primary care practitioner. Ollivant’s patients were nursing home residents insured by a UnitedHealth Medicare Advantage plan. In theory, his job was to monitor their symptoms proactively enough to keep them from being admitted to the hospital unnecessarily. In practice, many of his patients desperately needed hospitalization: One had a stroke and later gastrointestinal bleeding; another needed a blood transfusion. But Optum bosses, according to the lawsuit, did everything in their power to stop Ollivant and his colleagues from hospitalizing patients suffering from obvious, emergent life-threatening conditions, instead directing its employed nurse practitioners to see their “mission” as convincing patients to essentially waive their rights to medical treatment by signing do-not-resuscitate (DNR) orders or “comfort care” agreements.

On Tuesday, the former Cigna executive turned health care whistleblower Wendell Potter broke the news that his former employer was planning a merger with HMO giant Humana, which would create an insurance behemoth, with nearly $300 billion in revenue in 2023. Both Cigna and Humana have been under fire recently for alleged efforts to deny reimbursement claims for routine and often urgent medical care. A ProPublica/Capitol Forum investigation earlier this year revealed Cigna was using an algorithm called PXDX to illegally issue blanket denials on hundreds of thousands of claims that would have previously been reviewed by physicians (and in all likelihood, approved). Similarly, Humana has been under congressional scrutiny over its massive “prior authorization” bureaucracy, which requires doctors to obtain up-front permission to treat its Medicare Advantage customers at a rate of 2.8 times per patient per year, the second-highest in the business.



At UnitedHealth, which employs or contracts exclusively with 90,000 physicians and untold thousands of physician assistants and nurse practitioners like Ollivant, bosses can skirt the messiness of prior authorization and denial, and the attendant litigation and regulatory scrutiny involved, by simply pressuring its clinical workforce to deny care out of the gate. Such are the perks of “vertical integration,” through which the country’s largest insurer has turned itself into a one-stop walled garden for health care, and increasingly for its denial.

Link to tweet

It’s a brilliant business model. UnitedHealth is now the fifth-biggest company in America by revenue, with operating income approaching $25 billion and a market capitalization of a half-trillion dollars, largely on the strong growth of its Optum medical empire and the one-stop shop for Medicare Advantage patients they serve. And it’s also pretty obviously what Cigna and Humana are hoping to replicate with their merger, so long as antitrust authorities don’t get in the way. The two companies are likely betting that whatever resistance Biden’s DOJ exercises to the deal will be undone by a future Trump administration.

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[walkingman]

1. I don't think less competition will be good for consumers.

[PufPuf23]

2. Health care in the USA has corporate covid.

Corporate monopoly abounds as private equity and institutional investors consume most sectors of the US economy.

Finance is always looking for new revenue streams to securitize and sell to each other.

[OldBaldy1701E]

3. Wonderful!

Absolutely nothing can go wrong with this. Having two massive insurance behemoths denying everything should make their investors quite happy.

[ProfessorGAC]

4. One Odd Number In There

UnitedHealth is now the fifth-biggest company in America by revenue, with operating income approaching $25 billion and a market capitalization of a half-trillion dollars...

$25 billion in operating income on $324 billion in revenue?
That suggests pretty sloppy management. A 6.2% margin? In a rigged system like health-care?
Something is awfully fishy with those financial statements.
BTW: I searched their financial statements. The numbers in the article are accurately reported.

[multigraincracker]

5. Bust the Trust.

Need to revive that one.