Why are nurses not usually integrated into the cost containment discussion? Why have we not been invited to the table? Likely, it is because we don’t have the power to order (or discontinue) tests, labs, or medications, all of which are major factors in the rising costs of care. Even so, a nursing perspective can be important and should be considered when doctors make treatment decisions.
For example, I recently treated a patient who had undergone abdominal surgery. Despite uncomplicated post-operative days 1 and 2, on day 3, he developed nausea, vomiting, and an increasingly distended abdomen. I administered intravenous anti-nausea medications, along with back rubs and cool cloths on his forehead. None of the treatments worked. While waiting for the doctor, I sat with the patient and spoke to him about the possibility of receiving a nasogastric tube to alleviate his symptoms. Given an understanding of the process, the patient agreed to this possibility and I paged the doctor once again. The doctor eventually placed the nasogastric tube, the tube was connected to suction, and out came a liter of gastric contents.
I then noticed that the doctor had put in an order for an abdominal x-ray to “check nasogastric tube placement.” Seeing this, I initiated a conversation with the doctor to discuss the patient’s symptomatic improvement as well as his current state of exhaustion. I assured the doctor that nurses would be at the patient’s bedside to monitor for signs and symptoms of tube malfunction. As a result, the doctor cancelled the x-ray, which not only eliminated an unnecessary test for the patient, but also reduced the cost associated with his care.
Continue reading “Bringing Nurses Into the Cost Containment Discussion”
Filed Under: Hospitals, THCB, The Business of Health Care
Tagged: cost containment, Costs of Care, Nurses, September Wallingford
Jul 15, 2013
Connecticut’s Appellate Court recently ruled that hospitals and doctors can successfully sue their patients’ attorneys for filing a vexatious malpractice suit. The Court also ruled that the trial judge’s decision that the patient’s suit was vexatious will often create an estoppel against the attorney. The attorney will consequently be precluded from contesting that decision. The only issue will then be the amount of damages—double or treble—that the attorney and her firm will be obligated to pay the hospital or the doctor. See Charlotte Hungerford Hospital v. Creed — A.3d —-, 2013 WL 3378824 (Conn. App. 2013).
Whether this is going to be a trend in our medical malpractice law remains to be seen. In the meantime, I provide the details of that important decision.
Attorneys representing the family of a psychiatric patient, who committed suicide, filed a malpractice suit against a hospital and some of its doctors. They alleged that the defendants prematurely discharged the patient from the hospital’s emergency room while she was still experiencing a severe mental health crisis. Allegedly, this untreated crisis was the cause of the suicide that the patient committed four days later.
The suit was supported by an opinion letter from a registered nurse (!!). Under Connecticut law, as in many other states, the supporting opinion letter must come from “a similar health care provider.” The attorneys thus should have retained a psychiatrist, rather than a nurse, as an expert supporting the suit. Their failure to do so rendered the suit defective and the trial judge properly struck it out.
Continue reading “A New Trend? Hospital Successfully Sues its Patient’s Attorneys for Filing a Vexatious Malpractice Suit”
Filed Under: Hospitals, THCB
Tagged: Alex Stein, Defensive Medicine, Hospitals, Malpractice, Patients, Physicians, Psychiatry
Jul 10, 2013
The U.S. Bureau of Labor Statistics came out with its June jobs report this week and, consistent with usual trends, healthcare jobs are booming. In June 2013 there were approximately 20,000 new healthcare jobs in the U.S., ¾ of which were in the ambulatory care sector and ¼ of which were in hospitals. Healthcare jobs represented 10% of all new jobs created this month.
The June growth in healthcare jobs matches up to the average 19,000 new healthcare jobs we have seen created in each of the prior months of 2013 and the 12% job growth we have seen over the last five years. In a country where new jobs are viewed as even better than baseball, apple pie and mom herself, these new jobs should elicit a huge round of applause, or at least a stadium style wave, right?
Or should they?
Change the channel and a different set of policy makers, employers and industry experts will tell you that the only way to save our economy from ruin is to cut healthcare costs. Cutting healthcare costs means making the people who work within the system vastly more efficient, eliminating unnecessary medical care (and thus reducing the labor that goes along with it), and helping empower consumers to do things for themselves, including taking a more active role in reducing their own demand for healthcare services and, in some cases, doing at home what they might previously have used the healthcare system to do (e.g., diagnostics, home care, etc).
Continue reading “It’s the Jobs, Stupid. No, Wait. It’s the Stupid Jobs.”
Filed Under: Hospitals, OP-ED, THCB
Tagged: Costs, Employers, Employment, health care jobs, Hospitals, Lisa Suennen, spending
Jul 8, 2013
The House Committee on Energy and Commerce Subcommittee on Health recently held hearings on how to replace the broken sustainable growth rate (SGR) tool for controlling Medicare spending on physician services. I was asked to speak for major employers about their efforts to improve health care quality while containing cost.
Why did the subcommittee invite a business group representative to testify? And why should businesses care about how Medicare pays physicians?
The answer is that employers and the federal government are both major purchasers of health care, and we want government to look to the private sector for ideas to accelerate innovation in how we pay for care. Both public and private purchasers have a stake in building a system based on innovation, value, and measuring what matters.
The Pacific Business Group on Health’s (PBGH) 60 member companies provide health care to 10 million employees and their dependents in all 50 states. For decades, large and small employers alike have been frustrated by the rising costs and inconsistent quality of health care. A major reason for these problems is that the current payment system rewards physicians for more office visits, tests, and procedures, regardless of whether they are needed or result in better health. We need a better, more effective method of physician payment. PBGH members have real-world experience designing and implementing innovations in how providers deliver care and how they are paid for it. Medicare can learn from these efforts to improve quality and control costs.
Continue reading “Paying Physicians for Quality: Lessons from Employers”
Filed Under: Hospitals, Physicians, THCB, The Business of Health Care
Tagged: Bill Kramer, Pacific Business Group on Health, Physicians, Quality
Jul 7, 2013
An old data series got new life, when the Brookings Institution issued a report that compared health care jobs growth versus all other industries.
It’s “a truly astonishing graph,” according to Derek Thompson at The Atlantic. “I knew health care had been the most important driver of national employment over the last few years, but I had never seen the case made so starkly.”
Thompson wasn’t alone in his surprise. (Hopefully, readers of The Health Care Blog would be less astonished.) But lost within the reaction—and even mostly overlooked within the industry—is that not all health care jobs are growing, or at least not growing at the same pace.
Take a look at the following chart. It resembles the Brookings data, with one major change: The hospital employment curve has been separated from all other health care jobs growth.
Notice how hospital employment essentially flatlined across 2009—a hard year for the sector, which was still insulated compared to the rest of the economy. But many organizations pared back on staff and sought to cut non-essential services to survive the Great Recession.
Continue reading “Hospitals Lost Jobs Last Month. Should We Be Surprised?”
Filed Under: Hospitals, THCB
Tagged: Consolidation, Dan Diamond, Employment, health care jobs, Hospitals, Obamacare, outpatient care, Patients, The Affordable Care Act
Jul 6, 2013
Steven Brill’s TIME MAGAZINE blockbuster article, Bitter Pill: Why Medical Bills are Killing Us, uncovers the CHARGEMASTER: a publicly undisclosed pricelist accountable for what we see in hospital bills. What we see there doesn’t look good: it includes acetaminophen sold for $1.50 a tablet (you can buy 100 of those for the same price at Amazon); $77 for a box of sterile gauze pads (Amazon’s prices vary between $6 and $11); $18 for a single diabetes test strip (sold for 54 cents by Amazon); $108 for antibacterial Bacitracin ointment (Amazon’s prices vary between $2.50 and $6.50); and so forth. Charges for stay, scans, surgeries, canes, and wheelchairs skyrocket as well.
The American Hospital Association (AHA) rejects Brill’s analysis. According to AHA, the chargemaster aggregates the hospital’s overall costs on delivering quality care to patients: “In order to take medications in a hospital, even over-the-counter medicines, they must be prescribed by a doctor (a little bit of cost for the doctor), that order gets transmitted to the pharmacy (a little more cost), the order gets filled by a pharmacist or pharmacy tech who retrieves just one Tylenol pill and individually packages that one pill (still more cost), the pill gets transported from the pharmacy to the nursing unit where the patient resides (a little more cost), then the pill is retrieved by a registered nurse who personally gives the pill to the patient and then must document the administration of that pill in the patient medication administration record (a little more cost). All of this process to give a patient a single dose of Tylenol in a hospital bed [must also be] in compliance with all pertaining regulations (a little more cost).”
This post will not try to resolve the Tylenol Debate. Nor will it say anything about the government as a plausible substitute for the eccentric chargemaster. Instead, I will raise a legal question: Can patients sue hospitals for excessive markups on medications and devices?
My answer to this question is a qualified YES.
Entrepreneurial and business aspects of running a hospital fall under states’ consumer protection laws (Brookins v. Mote, 292 P.3d 347 (Mont. 2012)). Those aspects certainly include billing (Jaramillo v. Morris, 750 P.2d 1301, 1304 (Wash. App. 1988); Ambach v. French, 216 P.3d 405 (Wash. 2009)).
The key question here is whether an excessive markup on medications and devices amounts to deceit or an unfair trade practice. If it does, the hospital would be in violation of the relevant state consumer protection law.
Continue reading “Can Hospitals be Sued for Excessive Markups on Medications and Devices?”
Filed Under: Hospitals, THCB
Tagged: Alex Stein, Bill of Health, Chargemaster, Hospital Billing, liability, Steven Brill
Jun 30, 2013
Mitt Romney’s/Paul Ryan’s premium support/voucher plan was heavily derided during the dark days of Campaign 2012, but the devil was always more in the details than the theory. While the re-election of President Obama left premium support dead on the Medicare level, health insurers are increasingly turning to the ideas that drove it – choice, competition, and the power of a (carefully regulated) market – to address high costs on the procedural level. Call it the micro-voucherization of health insurance.
This is known by wonks as reference pricing, and its recent results in California are promising: the costs of hip and knee replacements fell by 19%, with no attendant decrease in quality. Using reference pricing is an assault on the status quo that holds the promise of “bending the curve” in a meaningful way, but it faces technical and political concerns that may consign it to the graveyard of promising-but-unfulfilled ideas.
Broadly-speaking, reference pricing is the act of offering a set amount of money for the purchase of a good, where the reference is an amount that can reasonably said to offer meaningful coverage for that good. Sometimes, reference pricing is focused on a given procedure – what I’ll refer to as “inputs-oriented reference pricing”; other times, a given outcome, or “outputs-based reference pricing.”
That’s pretty vague, so let’s use the colonoscopy procedure (which has recently received a lot of attention thanks to an informative New York Times article) to help color this in. The inputs-oriented approach would see the payer asking: given the choice to have a colonoscopy – a procedure which varies wildly in cost without varying wildly in quality – what’s a reasonable price to pay? It would decide this based on some combination of price, quality, and geography, and would inform consumers of its spending cap.
Say it finds that most of its insured population can reasonably access a high-quality colonoscopy for $10,000; if a consumer choose provider that charges $15,000, he or she would pay the $5,000 difference out of pocket. Choice is preserved, but at a cost. The simple chart above shows how this may work.
But, if you read the colonoscopy article, you may be asking a separate question: why pay for a colonoscopy at all?
Continue reading “Bending the Cost Curve with Reference Pricing”
Filed Under: Hospitals, THCB
Tagged: bitter pill, Colonoscopy, Competition, Costs, Hip Replacement, Insurance, micro-voucherization, Mike Miesen, reference pricing
Jun 27, 2013
There is an old saying that every unsustainable trend, by definition, comes to an end. The U.S. healthcare system has been on an unsustainable trajectory, consuming more and more of our national income while failing to deliver the kind of care that Americans need and deserve. But although every unsustainable trend eventually ends, how it ends is up to us.
The healthcare system has the potential to collapse under its own weight, requiring Americans to pay even more for healthcare, forcing draconian and blunt cuts in the kinds of services available, and putting high quality healthcare out of reach for the poor and the sick.
An alternative future is one in which payers pay for value, providers become more efficient and patient centered, and consumers become increasingly engaged in caring for themselves. In this future, healthcare becomes an important force for improving the health of the American public.
What will determine which path our healthcare system will take? While the fate of our healthcare system will be influenced by policymakers in Washington DC and the state capitals, it will ultimately be decided by each of us – providers and patients who are involved in the daily work of delivering and engaging in healthcare.
The journal Healthcare: The Journal of Delivery Science and Innovation is an effort to nudge us toward a better, sustainable path for our healthcare system. The mission of the journal is simple: to play a meaningful role in fostering real change in the healthcare delivery system. The journal wants to be a venue for sharing the best ideas for delivery science, payment innovation and smart use of health information technologies. The journal was conceived by Amol Navathe and Sachin Jain, who have been thinking long and hard about compelling new approaches to bring about change in the healthcare system. It took years of persistence to line up a terrific publisher, put together a top notch editorial board and recruit some of the nation’s best minds to lead individual theme areas. And it paid off handsomely. Today, June 26th, Healthcare officially launches with its premier issue, and what an issue it is.
The two introductions are short, pithy and worth reading over and over again. The first is by Don Berwick, the former Administrator of the Centers for Medicare and Medicaid Services but even more importantly (at least to me), the man who has done more to promote quality and safety than anyone in recent memory. Don frames the issues in ways that only he can, reminding us that we can have the best healthcare system in the world – we have all the pieces – but we have to learn how to put it together.
Continue reading “Healthcare Lands: Announcing the Journal of Delivery Science and Innovation”
Filed Under: Hospitals, THCB
Tagged: Ashish Jha, health care delivery, Innovation, Quality, The Journal of Delivery Science and Innovation
Jun 26, 2013
If you have ever tried to choose a physician or hospital based on publicly available performance measures, you may have felt overwhelmed and confused by what you found online. The Centers for Medicare and Medicaid Services, the Agency for Healthcare Research and Quality, the Joint Commission, the Leapfrog Group, and the National Committee for Quality Assurance, as well as most states and for-profit companies such as Healthgrades and U.S. News and World Report, all offer various measures, ratings, rankings and report cards. Hospitals are even generating their own measures and posting their performance on their websites, typically without validation of their methodology or data.
The value and validity of these measures varies greatly, though their accuracy is rarely publically reported. Even when methodologies are transparent, clinicians, insurers, government agencies and others frequently disagree on whether a measure accurately indicates the quality of care. Some companies’ methods are proprietary and, unlike many other publicly available measures, have not been reviewed by the National Quality Forum, a public-private organization that endorses quality measures.
Depending where you look, you often get a different story about the quality of care at a given institution. For example, none of the 17 hospitals listed in U.S. News and World Report’s “Best Hospitals Honor Roll” were identified by the Joint Commission as top performers in its 2010 list of institutions that received a composite score of at least 95 percent on key process measures. In a recent policy paper, Robert Berenson, a fellow at the Urban Institute, Harlan Krumholz, of the Robert Wood Johnson Foundation, and I called for dramatic change in measurement. (Thanks to The Health Care Blog for highlighting this analysis recently.)
We made several recommendations, including focusing more on measuring outcomes such as mortality and infections rather than processes (e.g. whether patients received the recommended treatment) or structures of care (e.g. whether ICUs are staffed around the clock with critical care specialists). We urged that measures be at the organization level rather than clinician level, to reflect the fact that safety and quality are as much products of care delivery systems as of individual clinicians. We propose investments in the “basic science” of measurement so that we better understand how to design good measures. You can read these and other recommendations in the analysis.
Continue reading “A SEC for Health Care?”
Filed Under: Hospitals, OP-ED, THCB
Tagged: Measurement, Outcomes, Peter Pronovost, Quality, SEC
Jun 4, 2013
I sometimes explain to medical students that they are entering a profession being transformed, like coal to diamonds, under the pressure of a new mandate. “The world is going to push us, relentlessly and without mercy, to deliver the highest quality, safest, most satisfying care at the lowest cost,” I’ll say gravely, trying to get their attention.
“What exactly were you trying to do before?” some have asked, in that wonderful way that smart students blend naiveté with blinding insight.
It is pretty amazing that healthcare has been insulated from the business pressures that everybody from Yahoo! to my father’s garment business have experienced since the days of Adam Smith. We experienced a bit of this pressure in the mid-1990s, when pundits declared healthcare inflation “unsustainable” (sound familiar?) and we invented managed care to slay it. We know how that story ended – the public and professional backlash against HMOs defanged the managed care tiger to the point that it could barely produce a “meow.” The backlash was followed by a 15-year run during which efforts to slash healthcare costs have been remarkably meager.
That run has ended.
Luckily, while we’ve been let off the hook on cost-reduction, we’ve not been given a free pass on improvement. Beginning with the Institute of Medicine reports on safety (2000) and quality (2001), we have been under growing pressure to improve the numerator of the value equation: patient safety, quality of care, and patient satisfaction. Particularly for those of us who work in hospitals, we now feel this pressure from many angles: from accreditors (more vigorous and unannounced Joint Commission inspections, residency duty hour limits), transparency (Medicare’s Hospital Compare), comparative measurement (HealthGrades, Leapfrog, Consumer Reports and many other hospital rankings), and, most recently, payment policies (no pay for “never events,” penalties for readmissions, value-based purchasing, and “Meaningful Use” standards for IT).
These initiatives have created an increasingly robust business case to improve. Hospitals everywhere have responded with new resources, committees, ways of analyzing data, educational programs, computer systems, and more.
Continue reading “How UCSF Is Solving the Quality, Cost and Value Equation”
Filed Under: Hospitals, OP-ED, THCB
Tagged: Bob Wachter, Costs, Gary Kaplan, Hospitals, LEAN, Patient Safety, Quality, Transparency, UCSF, Value
May 27, 2013