Month: March 2014

Taking Stock of the ACA

Mar 31, 2014• 5

By DAVID DRANOVE and CRAIG GARTHWAITE

With the ACA exchange enrollment deadline almost behind us, this is a good time to take a look at the big picture.

Three years after the first baby steps of implementation, what has the ACA accomplished?

When we consider the ACA, we can think of two broad goals. The “easy” goal was expanding coverage to the uninsured. We say “easy” because regulators should be able to succeed by simply throwing money at the problem, and that is a task our elected officials seem particularly adept at accomplishing.

The “hard” goal was bringing down the rate of growth in health care spending.

This has proven to be a difficult task for policy makers, who have been trying (and failing) for decades and have often done more harm than good.

We first consider the goal of expanding coverage to the uninsured. From its onset, the ACA chalked up a small victory by requiring plans to continue coverage for dependents under age 26.

This provided coverage to as many as three million uninsured, albeit the healthiest members of the population. The lion’s share of the reduction in the numbers of uninsured was supposed to come from Medicaid expansions and private exchanges.

And here is where the problems emerge.

Medicaid ranks have swelled in the 27 states (including DC) that have chosen to expand the program. Republican leadership in other states continue to assert they will not expand Medicaid, but given the exceptionally generous federal funding for this expansion, we find it hard to believe that most of these states won’t soon join the expansion.

After all, even Louisiana eventually raised its drinking age to 21 to get its share of federal highway funding. Similarly, we can’t imagine that the red states will turn down billions of dollars in federal funds.

Death Panels: Can We Handle The Truth?

Mar 31, 2014• 6

By THADDEUS MASON POPE, JD PhD

In December, I defended the term death panel. Specifically, I demonstrated that we already have, and for over 50 years have had, quite a number of tribunals that act as death panels.

For example, at least daily, UNOS denies potentially life-saving organ transplant requests. While the term “death panel” has a pejorative connotation, the essential concept and function is necessary. Particularly in situations of strict scarcity, life and death decisions must be made. They are made. And they will continue to be made.

So, the relevant question is not whether to “have” death panels. Instead, the relevant question is whether we want to openly “acknowledge” our death panels. I am reminded of a famous scene from the 1992 film, A Few Good Men. You will recall that the story revolves around the court martial of two Marines charged with the murder of a fellow Marine. The defendants had administered a “Code Red,” an unofficial punishment, against a fellow member of their unit who was not sufficiently squared away to meet the Corps’ standards.

In the film’s most famous scene, Lt. Kaffee (Tom Cruise) cross examines Col. Jessup (Jack Nicholson) about the Code Red. Lt. Kaffee says, “I want the truth!” Jessup responds:

You can’t handle the truth! Son, we live in a world that has walls, and those walls have to be guarded by men with guns. . . . I have a greater responsibility than you can possibly fathom.

You weep for Santiago and you curse the Marines. You have that luxury. You have the luxury of not knowing what I know, that Santiago’s death, while tragic, probably saved lives. And my existence, while grotesque and incomprehensible to you, saves lives!

You don’t want the truth, because deep down in places you don’t talk about at parties, you want me on that wall.

Col. Jessup’s point is that Code Reds are an invaluable part of close infantry training. But since they are “grotesque,” they are officially discouraged (even prohibited).

Is this the path that we should take with death panels? Since we find them grotesque, should we deny both their necessity and their existence? The argument has been compellingly made. In their 1978 book, Tragic Choices, Guido Calabresi and Phillip Bobbitt argued that the difficult but necessary life-and-death choices entailed in rationing can only be made by hiding them from public scrutiny.

In contrast, others call for open acknowledgement of death panels. For example, in a recent interview with Rolling Stones, Bill Gates rightly observed that we must deny even effective and life-saving medical technology to some people. “The idea that there aren’t trade-offs is an outrageous thing. Most countries know that there are trade-offs, but here, we manage to have the notion that there aren’t any. So that’s unfortunate, to not have people think, ‘Hey, there are finite resources here.’”

Gates is right. Calabresi and Bobbitt are wrong. The disadvantages of a “hide and deny” approach are substantial. First, it makes it more difficult to have our death panels operate in an open and transparent manner. This increases the risk of bias and corruption. Second, it means that they may not operate according to sufficiently deliberated principles. Third, a hide and deny approach means that death panels may not operate in a consistent and uniform manner from region to region. In short, hiding and denying death panels forecloses and delays much needed public discourse over how we want out death panels to operate.

Death panels, while tragic, save lives. And their existence, while grotesque and incomprehensible to many, saves lives. We don’t want the truth, because deep down in places we don’t talk about at parties, we want death panels.

Unpacking the Doc Fix

Mar 30, 2014• 8

By BILLY WYNNE

If you blinked on Thursday, you might’ve missed the House passing the latest Medicare’doc fix’ (see here for its 30-seconds of deliberation).

After posting the bill in the wee hours of Wednesday morning, House leaders faced opposition over its stop-gap approach and some of the cuts employed to offset the cost of the bill. With some arm-twisting, they managed to suppress objections for the handful of seconds necessary to hammer the gavel and call it done.

The Senate is due to take the bill up Monday evening, and it is highly likely to pass (this time it should actually get a vote). Since it is about to become the law of the land, let’s take a look at what’s inside. There’s a little slice of fun in here for everyone.

First and, theoretically, foremost, the bill blocks the pending cuts to doctors under the long-broken Sustainable Growth Rate (SGR) formula. It would maintain existing physician pay rates for another twelve months, through March 31, 2015.

Not coincidentally, a vote to raise the debt limit will likely come due again at about that time.

Second, the bill continues, for a comparable period, the package of so-called Medicare extenders: a hodge podge of policies that boost payments in rural areas, suspend caps on certain benefits and other otherwise sunsetting policies that each have their niche constituencies. Many of these items have been reauthorized by Congress for over 15 years.

Third, the bill includes some new policies that put out fires of their own, or effectuate high priority programs for well-placed Members of Congress. These include:

An additional six month extension of the Two Midnights Rule, which drew a bright line distinction between presumptive inpatient and outpatient hospital stays but has created significant confusion and objections among many hospitals;
A one-year delay of ICD-10 implementation, to October 1, 2015 (this is the second time Congress has acted to delay ICD-10);
Elimination of the ACA cap on deductibles for employer-sponsored health plans; and
Two provisions aiming to improve mental health services, including the Excellence in Mental Health Act that, among other things, improves funding for community mental health centers.

Woah, some of you are saying. Dial back to that 2^nd bullet. While the transition to ICD-10 has been controversial since it was first proposed in 2005, just last month CMS Administrator Tavenner said there would be no more delays (last year, the Administration voluntarily delayed the program from 2013 to 2014).

Healthcare providers have been battening down the hatches and preparing for this colossal transition from ICD-9 and its 14,000 codes to ICD-10 and its 69,000. Word on the street is that the provision was included primarily to earn cred with specialty physician groups, whose support for the bill was in question for concern about other provisions (see the bullet re: misvalued – aka overvalued – codes below).

Turns out, the specialty doc associations by and large opposed the bill anyway, and the healthcare sector is now left grappling with this unexpected turn.

Hospital Acquired Infections: How Do We Reach Zero?

Mar 30, 2014• 4

By PETER PRONOVOST, MD

This week, the U.S. Centers for Disease Control and Prevention issued two reports that are simultaneously scary and encouraging.

First, the scary news: A national survey conducted in 2011 found that one in every 25 U.S. hospital patients experienced a healthcare-associated infection. That’s 648,000 patients with a combined 722,000 infections.

About 75,000 of those patients died during their hospitalizations, although it’s unknown how many of those deaths resulted from the infections, the CDC researchers reported in the New England Journal of Medicine.

On the bright side, those numbers are less than half the number of hospital-acquired infections that a national survey estimated in 2007. And a second report issued this week found significant decreases in several infection types that have seen the most focused prevention efforts on a national scale.

Noteworthy was a 44 percent decrease in central line-associated bloodstream infections (CLABSI) between 2008 and 2012, as well as a 20 percent reduction in infections related to 10 surgical procedures over the same time period.

These infections were once thought to be inevitable, resulting from patients who were too old, too sick or just plain unlucky. We now know that we can put a significant dent in these events, and even achieve zero infections among the most vulnerable patients.

At Johns Hopkins, we created a program that combated CLABSI in intensive care units through a multi-pronged approach—implementing a simple checklist of evidence-based measures while changing culture and caregivers’ attitudes through an approach called the Comprehensive Unit-based Safety Program (CUSP). The success was replicated on a larger scale across 103 Michigan ICUs and then later across most U.S. states, withimpressive results.

These and similar successes have changed caregivers’ beliefs about what is possible, and inspired more efforts to reach zero infections.

What will it take to attain this goal—or at least get much closer?

Numbers We’d Rather Be Talking About

Mar 29, 2014• 11

By JOHN IRVINE

You’ll be hearing a lot about the number six point five million over the next few days.

Six point five million — or whatever the exact number turns out to be at the end of the day — being the number of people that the administration say signed up for Obamacare through the exchanges when open enrollment ends March 31st.

How meaningful the official numbers are will be open to debate. The bloviation factor will be in full effect. The critics will be downplaying the administration’s number, ACA supporters defending it. Data geeks-turned-media stars will explain what it all means.

Here’s a guide to some of the other numbers we should be talking about as we try to make sense of what’s really going on and what really happened during the Obamacare rollout.

FUDs: The number of people who are innocently living their lives thinking they have bought health insurance, but who, for one reason or another, be it technical glitch, bureaucratic incompetence or technicality – are going to wake up one morning not long from now and discover that they do not have health insurance.

And who one day soon will discover that they do not have health insurance. This is the group that causes people in Washington to lie awake at night; because they are going to complain – and complain loudly. While the talk from the administration to this point has been all tough, it seems logical to assume it will build an appeal mechanism that will allow FUDs back into the system. The early signs are that this is the case.

404s : The number of people / applications lost in the system, either as a result of the Healthcare.gov fiasco or because their application is sitting forgotten on somebody’s desk somewhere or on a laptop. Anybody who tried to log into Healthcare.gov at the height of the meltdown or who has gone back and forth with their insurance company over a bill gets it.

It is safe to assume that this is another number that keeps planners up at night. Let’s just say it is safe to assume that there are a lot of 404s.

CANCELS: The number of people who had their insurance plans cancelled by insurers on the grounds that they did not meet the standards set by the Affordable Care Act. In a way, being a cancel can be considered a badge of honor in the gamification of the healthcare system that is Obamacare.

UNCANCELS: The number of people who had their plans cancelled by the health insurers only to have them declared “uncancelled” by the Obama administration or their state. Nobody really knows how many uncancels there are. Don’t ask. Yes, it will take a really long time to sort out the uncancels from the cancels and the QHPs.

And you will probably want to shoot the person explaining it to you. In the gamification of the healthcare system, level ups go to people who have been cancelled, uncancelled and bumped.

BUMPS: The number of people who have been “bumped” out of network and are being forced to change doctors. What’s going on? In gamification terms, bumps make things more exciting. In real life, they suck. Getting bumped off a flight is annoying, getting bumped in the health care system is potentially life-threatening.

LIVES SAVED: As we speak Nate Silver or a smart person who looks and sounds a lot like Nate Silver is sitting at a computer in a darkened room somewhere trying to come up with a reliable quantification of the number of lives the Affordable Care Act has saved and will save by shielding people from the barbaric US healthcare system.

How would you go about coming up with that number? Would you look at people turned away from emergency rooms? Would you look at the number of preventable deaths under the old system? Would you total the number of deaths from cancer, heart attack and stroke? Compare mortality rates over the decade from 2004-2014 with those from 2014-2024? It will be long time before we have the data we need to really understand how well we’ve done.

You can forget the nonsense we’ve been hearing about Obamacare costing the lives of thousands of Americans by taking their health coverage away from them. There is a difference between losing your coverage temporarily because the system is in transition and losing it and knowing that you’ll never be able to get it back. Ever.

Calculated over decades to come the number of lives saved is likely to total in the thousands, if not the millions. And that will be the true test of the Affordable Care Act as a historical accomplishment for Barak Obama and his administration.

Is Medicine a Big Data Problem?

Mar 29, 2014• 4

By Ted Driscoll

Human beings are big data. We aren’t just 175 pounds of meat and bone. We aren’t just piles of hydrogen and carbon and oxygen. What makes us all different is how it’s all organized and that is information.

We can no longer treat people based on simple numbers like weight, pulse, blood pressure, and temperature. What makes us different is much more complicated than that.

We’ve known for decades that we are all slightly different genetically, but now we can increasingly see those differences. The Hippocratic oath will require doctors to take this genetic variability into account.

I’m not saying there isn’t a place for hands-on medicine, empathy, psychology and moral support. But the personalized handling of each patient is becoming much more complicated. The more data we can gather, the more each individual is different from others.

In our genome, we have approximately 3 billion base pairs in each of our trillions of cells. We have more than 25,000 genes in that genome, sometimes called the exome. Each gene contains instructions on how to make a useful protein. And then there are long stretches of our genomes that regulate those protein-manufacturing genes.

In the early days, some researchers called this “junk DNA” because they didn’t know what it did. But this was foolish because why would evolution conserve these DNA sequences between genes if they did nothing? Now we know they too do things that make us unique.

For Hospitals and Health Systems: Strategies for Doing More with Less

Mar 28, 2014• 20

By Joe Flower

The conversation has changed.

The old conversation: “You cost too much.”

“But we have these sunk costs, patients who can’t pay … ”

“OK, how about a little less then?”

The new conversation: “You cost too much. We will pay half, or a third, of what you are asking. Or we will take our business elsewhere. Starting now.”

“But … but … how?”

Exactly: How will you survive on a lot less money? What are the strategies that turn “impossible” to “not impossible”?

New Strategies
The old conversation arises from the classic U.S. health care model: a fully insured fee-for-service system with zero price transparency, where the true costs of any particular service are unknown even to the provider. The overwhelmingly massive congeries of disjointed pieces that we absurdly call our health care “system” rides on only the loosest general relationship between costs and reimbursements.

It’s a messy system littered with black boxes labeled “Something Happens Here,” full of little hand waves and “These are not the droids you’re looking for.”

With bundling, medical tourism, mandated transparency, consumer price shopping, and reference pricing by employers and health plans, we increasingly are being forced to name a price and compete on it. Suddenly, we must be orders of magnitude more precise about where our money comes from and where it goes: revenues and costs.

We must find ways to discover how each part of the strategy affects others. And we need some ability to forecast how outside forces (new competition, new payment strategies by employers and health plans, new customer handling technologies) will affect our strategy.

Key Strategy Questions
For decades, whenever some path to profit in health care has arisen (in vitro fertilization, urgent care, retail, wellness and the others) most hospitals have said as if by ritual, “That is not the business we are in.” As long as we got paid for waste, few health care organizations got serious about rooting it out.

And most have seemed content with business structures that put many costs and many sources of revenue beyond their control.

In the Next Health Care, the key strategy questions become:

Why are you not capturing as many revenue streams as possible?

How PCORI’s Research Will Answer the Real World Questions Patients Are Asking

Mar 27, 2014• 8

By Joe Selby, MD

As a physician, I know the challenge of helping patients determine which health care options might work best for them given their personal situation and preferences.

Too often they — and their clinicians — must make choices about preventing, diagnosing and treating diseases and health conditions without adequate information. The Patient-Centered Outcomes Research Institute (PCORI) was created to help solve this problem — to help patients and those who care for them make better-informed health decisions.

Established by Congress through the Patient Protection and Affordable Care Act as an independent research institute, PCORI is designed to answer real-world questions about what works best for patients based on their particular circumstances and concerns. We do this primarily by funding comparative clinical effectiveness research (CER), studies that compare multiple care options.

But more research by itself won’t improve clinical decision-making. Patients and those who care for them must be able to easily find relevant evidence they can trust. That’s why our mandate is not just to fund high-quality CER and evidence synthesis but to share the results in ways that are meaningful to patients, clinicians and others.

We’re also charged with improving the methods used in conducting those studies and enhancing our nation’s capacity to do such research.

We will be evaluated ultimately on whether the research we fund can change clinical practice and help reduce the variations and disparities that stand between patients and better outcomes. We’re confident that the work we’re funding brings us and the audiences we serve closer to that goal.

Recently, some questions have been raised in health policy circles about our holistic approach to PCORI’s work. That view holds that direct comparisons of health care options — especially those involving high-priced interventions — should be the dominant if not sole focus of PCORI’s research funding approach as a path to limiting the use of expensive, less-effective options.

We agree that discovering new knowledge on how therapies compare with one another is a critical mandate of PCORI and is essential to improving the quality and effectiveness of care. However, ensuring that patients and those who care for them have timely access to and can use this knowledge, so that they can effectively apply it to improve their decisions, is also very important.

Here’s How We Can Fix Obamacare if We Act Now and Stop Pretending the Problems Don’t Exist

Mar 26, 2014• 30

By Robert Laszewski

To properly price the exchange health insurance business going forward the carriers have to sharply increase the rates.

A senior executive for Wellpoint, which sells plans in 14 Obamacare exchanges, is quoted in a Reuters article telling Wall Street analysts there will be big rate increases in 2015, “Looking at the rate increases on a year-over-year basis on our exchanges, and it will vary by carrier, but all of them will probably be double digits.”

If the health plans do issue double digit rate increases for 2015, Obamacare is finished.

There are a ton of things that need to be fixed in Obamacare. But, I will suggest there is one thing that could save it.

The health insurance companies have to submit their new health insurance plans and rates between May 27 and June 27 for the 2015 Obamacare open-enrollment period beginning on November 15th. Any major modifications to the current Obamacare regulations need to be issued in the next month to give the carriers time to adjust and develop new products.

If the administration goes into the next open enrollment with the same unattractive plan offerings costing a lot more than they do today, they will not be able to reboot Obamacare.

Simply, health insurance plans that cost middle-class individuals and families 10% of their after-tax income and have average Silver Plan deductibles of more than $2,500 a month are not attractive and people won’t buy them any more enthusiastically next fall than they already have. See: Obamacare: The Uninsured Are Not Signing Up Because the Dogs Don’t Like It

Doubling the fines for not buying in 2015 will only give the Democrats more political problems––and it doesn’t look to me like they are going to enforce the fines anyway.

Health insurance plan executives are now faced with a daunting decision. How do they price the 2015 Obamacare exchange plans?

Even if the administration announces they have signed-up about 6 million people by March 31, the number of people enrolling would be well below expectations––only about 25% of those subsidy eligible will have signed up by the deadline. An enrollment that small guarantees the risk pool is sicker and more expensive than it needs to be in order to be sustainable.

But dramatically increasing the rates will only assure even fewer healthy people will sign up for 2015 and some of those who signed up for 2014 will back out over the higher rates. This is what a “death spiral” looks like.

Google Flu Trends Shows Good Data > Big Data

Mar 26, 2014• 3

By Kaiser Fung

In their best-selling 2013 book Big Data: A Revolution That Will Transform How We Live, Work and Think, authors Viktor Mayer-Schönberger and Kenneth Cukier selected Google Flu Trends (GFT) as the lede of chapter one.

They explained how Google’s algorithm mined five years of web logs, containing hundreds of billions of searches, and created a predictive model utilizing 45 search terms that “proved to be a more useful and timely indicator [of flu] than government statistics with their natural reporting lags.”

Unfortunately, no. The first sign of trouble emerged in 2009, shortly after GFT launched, when it completely missed the swine flu pandemic. Last year, Nature reported that Flu Trends overestimated by 50% the peak Christmas season flu of 2012. Last week came the most damning evaluation yet.

In Science, a team of Harvard-affiliated researchers published their findings that GFT has over-estimated the prevalence of flu for 100 out of the last 108 weeks; it’s been wrong since August 2011.

The Science article further points out that a simplistic forecasting model—a model as basic as one that predicts the temperature by looking at recent-past temperatures—would have forecasted flu better than GFT.

In short, you wouldn’t have needed big data at all to do better than Google Flu Trends. Ouch.

In fact, GFT’s poor track record is hardly a secret to big data and GFT followers like me, and it points to a little bit of a big problem in the big data business that many of us have been discussing: Data validity is being consistently overstated.

As the Harvard researchers warn: “The core challenge is that most big data that have received popular attention are not the output of instruments designed to produce valid and reliable data amenable for scientific analysis.”

The amount of data still tends to dominate discussion of big data’s value. But more data in itself does not lead to better analysis, as amply demonstrated with Flu Trends. Large datasets don’t guarantee valid datasets. That’s a bad assumption, but one that’s used all the time to justify the use of and results from big data projects.