Repeal + Replace

Repeal + Replace

It Begins

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For the second time in a decade, a president and Congress will undertake a large-scale effort to re-engineer the health care system.   

Politics and debate over policy are not the primary cause of this continued upheaval.  It is our patchwork, Rube Goldberg-like system, developed ad hoc over 50 years.      

As THCB readers know, we have an insurance and care delivery system that works less well—in terms of public health, coverage, patient outcomes, and cost—than health care in most of the rest of the developed world. 

And, things are getting worse.  To wit: rising death rates among middle-aged, low- and middle-income white Americans; the unchecked rise in obesity and preventable chronic diseases and opioid addiction; and woefully slow progress to reduce medical errors and improve patient safety.    

Here’s What Won’t Happen in 2017
(And What Will)

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In the political drama surrounding the new administration, healthcare is certain to take center stage as the 115th Congress convenes tomorrow and Donald Trump is sworn in as our 45th President and Chief Executive January 20. As it turns out, healthcare was a major issue in Campaign 2016, especially with Clinton-Sanders followers who wished expansion of coverage and a vocal minority of GOP voters who liked the promise of Repeal and Replace. Now it’s time to govern.

For the new Congress and administration, governing healthcare will play out against a testy backdrop: it will not be easy.

The Nation is Divided about the Affordable Care Act (HR3590): Only one in four Americans and one in two Republicans surveyed after the election wants the ACA repealed. By contrast, 30% want it expanded and 19% want it to remain as is, (Kaiser Family Foundation Poll December 28, 2016). Elements of the law are popular, like protections against denial of coverage due to pre-existing condition and continuation of coverage for young adults under 26 on their parents’ policy. But the individual mandate became a rallying cry for opponents who labeled it “government run healthcare” and partisans who tagged it ‘Obamacare’ voting to repeal it more than 60 times in the House. Objectively, for the past four years, the ACA has been shorthand for a debate about health insurance coverage and premium costs. The law imposed restrictions on how insurers operate and expanded coverage via Medicaid expansion and subsidies for those between 100 and 400% of the federal poverty level. Access increased–20 million are now covered that weren’t before—and premiums went up for everyone because the law imposed restrictions on how plans were required operate. Ironically, the insurance reforms are in Title I of the ACA “Quality, Affordable Health Care for all Americans”; delivery system reforms that address gaps in quality, care coordination, healthcare workforce innovation and unnecessary care are covered in the other 9 titles that got little attention from media, political pundits and politicians. Nonetheless, the ACA divides America though most know little about what’s in it.

The Art of the Deal: Coming
to Rx Prices Soon

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screen-shot-2016-12-28-at-2-21-40-pmDuring the campaign, President-elect Trump said “(w)hen it comes time to negotiate the cost of drugs, we are going to negotiate like crazy.”

While the President-elect’s pronouncements can’t always be taken at face value, this one should be.

In its December 7, 2016 prescription drug report to Congress, HHS reported Medicare (Parts B and D) and Medicaid Rx expenditures equaled $165.5 billion in 2014. Total 2014 retail and non-retail Rx spending was $424 billion.

HHS also reported that Rx spending “has been rising more quickly than overall health care spending . . . [and in] recent years, growth in prescription drug spending has accelerated considerably”.

If the reported annual rate of growth in 2014 (12%) holds for 2015 and 2016, Medicare/Medicaid’s Rx spending and total Rx costs in 2016 will exceed $200 billion and $500 billion, respectively.

As fiscal pressures to control healthcare costs build, Rx prices may be the ripest big ticket item on the table.

As the Trump Administration looks for bipartisan support for an ACA replacement, Rx prices could also provide some glue.

Making the Physician-Patient Relationship Great Again

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21st Century Cures is now law. Aside from its touted research and mental health provisions, it’s the most significant health information technology regulation since HITECH, now 8 years ago. A decent summary of the health IT provisions of the bill by John Halamka concludes with “That is just not realistic.” He’s almost certainly right to the extent your perspective is the hospital-centered mega-EHR model. You can’t get there from here.

Halamka and others who think that consolidated institutions will drive interoperability are in denial of the gap between financial integration and clinical integration. This recent post by Kip Sullivan describes some of the wishful thinking. But there’s another reason why HITECH’s institutional EHRs cannot get us to the Triple Aim, and it’s mostly about liability.

Halamka ignored one of the items in 21st Century Cures that could lead to clinical integration around a patient: a longitudinal health record. Section 4006 on page 149 includes:

“(1) IN GENERAL.—The Secretary shall use existing authorities to encourage partnerships between health information exchange organizations and networks and health care providers, health plans, and other appropriate entities with the goal of offering patients access to their electronic health information in a single, longitudinal format that is easy to understand, secure, and may be updated automatically.”

Useful longitudinal health records require curation and, almost by definition, the curators are not going to be affiliated with any single hospital or other institution operating a traditional EHR. Allowing licensed physicians, family caregivers, and the patient themselves to edit an institutional EHR is risky to the point of impossible. That’s why the current initiatives to introduce modern APIs into EHRs like SMART and Sync for Science are read-only.

Could Price Be Right?

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If confirmed as Secretary of HHS, Tom Price will oversee a $1 trillion budget – roughly one-third of all health expenditures.  His proposed legislation “Empowering Patients First” seeks to control costs by giving patients more choices and providing the information required to make them. He calls for publicly available standardized information on the price and quality of physicians, hospitals and other health care institutions.

It sounds like Dr. Price is prescribing a single data system. 

Medicare has had a single data system on the over-65 population for decades.  Since 2005, these data have informed Hospital Compare, a consumer oriented website comparing the quality of over 4000 hospitals.  And while prices in Medicare are relatively fixed, these same data have shown substantial variation in costs because the quantity of service – the number of hospital admissions, procedures and physician visits – varies substantially from place to place.

But Medicare is only one piece of the data puzzle.  A National Bureau of Economic Research report[nber.org] added another piece last year with data from large insurance companies like Aetna and United.  For the under-65 commercially insured population, it’s not just the quantity of services that are all over the map – it’s also the prices. 

Letter from Washington:
Don’t Jump … Yet

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Washington, D.C. hardly seems like a town on suicide watch.

As November turned to December, from the venerable Old Ebbitt Grill near the White House, to Charlie Palmer Steak at 101 Constitution and over to The Capital Grille at 601 Pennsylvania, revelers abounded, in both food and drink.

At the Capitol Hyatt on New Jersey Avenue though, some contrasts were evident. While contestants from the Miss World 2016 pageant moved in and out of the upper lobby to awaiting buses, in the lower-level meeting rooms, also from November 30 to December 2, the mood was hopeful optimism meets whistling past the graveyard.

There the Jefferson College of Population Health summit brought forth Andy Slavitt, Michael Leavitt, Farzad Mostashari, NCQA President Peggy O’Kane, former advisors from the George W. Bush and Obama administrations, officials from Johns Hopkins, the Henry Ford Health System, Brookings, Deloitte, AMA, AHA and the American College of Physicians and many more to dissect MACRA and ponder “population health strategy under the new administration.”

The consensus on where value-based care (VBC) is heading?

Wait and see.

The Price Is Basically Right

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Recently, President-Elect Trump selected Rep. Tom Price, MD to lead the Department of Health and Human Services.  Suffice it to say, this signals Mr. Trumps’ resolve and commitment to definitively repealing and replacing.  Dr. Price has already sunk his teeth into health care reform, having proposed alternative healthcare solutions in every Congressional session since 2009.  As a physician myself, I am delighted at the prospect of having another doctor at the helm of HHS. The last physician to lead HHS was Louis Sullivan, MD as part of the administration of George H.W. Bush.  Having a physician, who can understand the needs of physicians and patients, representing both in health policy decision making at the federal level gives everyone the best chance for meaningful and successful health care reform. 

Dr. Price is a third generation physician and a retired orthopedic surgeon with experience in clinical practice and academia before being elected to the U.S. House of Representatives.  At his core, he has been a fierce critic of Obamacare.  Dr. Prices’ most frequent objection to the ACA is the fact it hinders the ability of patients and physicians to be in control of medical decision making and puts the government squarely between doctors and patients.  Amen! He understands the subtle distinction that while expanding coverage may provide insurance, it is in no way akin to delivering patients unfettered access to health care. 

Dear Mr. President-Elect, about that Ryan Plan Thing

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The American people, myself proudly included, chose to send you to Washington DC to do their bidding. That’s what happened on November 8th 2016. Everything you hear now from the elite punditry is aimed at obfuscating this simple truth. Forget about dainty glass ceilings, we the people were able to break through the fortified ramparts erected by entrenched money and power and exercise our right to govern ourselves. I would caution the smug intelligentsia against underestimating the wisdom of the people once again, and I would caution you against forgetting who sent you there and why we did so. We now know we have the power, and what the people giveth, the people can taketh away.

RYANCARE

The ecstatic welcome you received from Paul Ryan and Mitch McConnell the other day looks more like an act of violence than one of true reconciliation. Fair weather friends are usually there because they want something, and in this case they want to highjack the people’s agenda and replace it with their own conservative garbage. Mr. Ryan in particular has been proposing bogus alternatives to Obamacare with alarming regularity. Similar to Obamacare, Mr. Ryan’s health reform plan is based on belief in his own superior intelligence and devoid of any evidence that it can indeed work. Unlike Obamacare, the Ryan plan is also based on the assumption that helping the poor get poorer and the rich get richer is the ultimate role of government.