In recent weeks, the market has reacted to a few noteworthy headlines, all involved with or touching upon value-based discretionary actions, and many with the not-so-hidden question: What’s In It for Me or WIIFM?
- CMS announced that by 2016 30% of fees in health care should be paid for through a value-based system, moving away from fee-for-service.
- ACO results have shown ambivalent outcomes.
- Outcomes-based contracts have permeated the Hepatitis C cost-nado (that’s a cost sharknado, the kind that fiercely defies cost controls and takes over all noise about payment reform and patient preferences).
- Reference-based pricing is a good/bad troublemaker in the middle of the value-based travails.
The latest rampages have appeared on two national and highly-regarded blogs: The Health Care Blog [Value-Based Reform] and The Health Affairs Blog [Go Slow on Reference Pricing].
As one of the loudest proponents on value-based designs, I lift the curtain again to show the thinking behind the movement from fee for service to value-based designs. All of these items above discuss the message of payment reform, or system alignment, but they are intensely linked to the patient-consumer ability to make the right choices, choose the right sites for care, and pay the right amount for services rendered to achieve health security.
This last—health security—should be at the heart of the US health system.
▪ It’s the place where patient competency is built and tested over time, as the patient becomes aware of health risks and chooses to modify behaviors to lower the risk.
▪ It’s the place where, when there are acute or emergent symptoms, there is no question but that the patient will be able to access the appropriate and affordable care in the safest possible setting, hopefully receiving care that delivers the patient back to functional health.
▪ It’s the place where caregivers and administrators are paid a competitive wage for serving the needs of the patient and getting the patient back to the best health possible.
Continue reading “Value-Based Health”
Filed Under: THCB, The Business of Health Care
Tagged: ACO, Health Value Continuum, Incentives, Outcomes, Value-based health reform, Value-based healthcare
Mar 11, 2015
During a move necessitated 20+ years ago by my change from a “private practice of medicine” life to a “back to school” life, I decided to undertake the move on my own using a rented van. I also had to affix a small trailer packed with furniture to the van. As I lifted the not so heavy trailer to the hitch, one of my children ran toward the trailer. I stopped my child’s progress with a holler and an out-stretched hand. As I did that, a disc in my back popped and dropped me to the ground. I have had back pain every day since. I have managed my back pain on my own. But, I now think it is time to start using my medical insurance to pay for the care of my back pain. So, fellow insured, you owe me a BMW.
Yes, a BMW. I know that my back pain is a subjective complaint and you can’t prove or disprove that I have it. I also know that there is no measure of my back pain; I can grade it on a scale from 0-10, as some do, but that is such a difficult task that I can’t internally come up with a number. I am sure, though, that the number changes daily. Even if I could assign a number to my pain, there is no guarantee that you would assign the same number should you suffer the exact pain as me, or that you could assign a number to my complaint better than I could. The pain is there, though. I feel it and alter my activities to not exacerbate.
Recently, a friend gave me a ride in his BMW. The seats fit my back to a t and as I sat there, my pain abated. I asked him to turn on the heated seats. Even more remarkable pain relief followed. In fact, after the ride in his car, I had no back pain for over 3 weeks, the first 3-week, pain-free stretch of time in over 20 years. So, since insurance plans often pay for some types of interventions such as heaters, buzzers, or needles, as examples, to help people with their back pain, so, then, shouldn’t insurance pay for a BMW for me? I think so.
Continue reading “You Owe Me a BMW”
Filed Under: Economics, THCB
Tagged: Evidence-based care, Insurance, Outcomes, Pain Management
Jan 29, 2015
Your correspondent is avidly learning about health apps for patients.
As described here, half of U.S adults now own a smartphone, half of them use them to obtain health information and approximately a fifth have at least one health app loaded on their device.
Regular readers are well aware of the potential for health apps, including lay-person education, the promotion of consumer behavior change, increased consumer-provider connectivity with greater access to care, better medication compliance as well as medication reconciliation, increased self-care, greater quality and lower costs.
But as this author’s e-health experience grows, he has encountered two under-recognized features of apps that – in his opinion – are sure to also drive their adoption:
1. The Provider App Arms Race: As competition for loyal patients grows, health systems, care organizations, insurers, buyers and provider networks are going to expect their apps to create greater consumer “stickiness.” For example, offering a tablet with a pre-configured app may enable hospitals to not only reduce readmissions, but enhance their brand recognition.
2. The App Is the Outcome: It will take years for science to prove that apps cause better outcomes. While lingering skepticism will prove to be another bonanza for outfits like this, the luster of smart-device gadgetry will be too much to resist. As a result, it’s only a matter of time until Boards and their CEOs pressure their management teams to launch their own app. While the electronic record and big data are important advances, let’s face it: they’re in the background. There’s nothing like a patient-facing app to remind customers, families and providers of the organization’s health tech chops.
Jaan Sidorov, MD, is a primary care internist and former Medical Director at Geisinger Health Plan with over 20 years experience in primary care, disease management and population-based care coordination. He shares his knowledge and insights at Disease Management Care Blog, where an earlier version of this post first appeared.
Filed Under: THCB
Tagged: Apps, Outcomes, Provider Arms Race, Smart Device
Dec 17, 2014
Accountable care demands that the system sync with the preferences and choices of the consumer purchasing the services. In order to get to real health value, consumer-patients must make the health care decisions that improve personal health and do not derail personal bank accounts. It was hard to piece these together for the last 15 years. Now, with high deductible plans, more transparency for costs, and on-time digital connectivity, there is less difficulty.
Information technology can deliver the needed information to the patient and the physician to improve not only the likelihood of improved care but also the time-to-achieve the outcomes. Most patients want and need to be involved in their care. There is evidence that giving patients access to their information results in higher levels of engagement and adherence to recommendations. In fact, the latest evidence shows that patients have been signing up for access to their health system portals at a rate of 1% per month for over 30 months.
Continue reading “Health Value: IT and the Rise of Consumer Centricity”
Filed Under: THCB
Tagged: Center for Health Engagement, Engagement, Outcomes, Quality, Value, value-based care
Oct 21, 2014
The first time I met one of my staff physicians on Internal Medicine, he told our team he had just one rule:
“Our team must contact the patient’s family physician during the admission, inform him or her of the situation and plan for appropriate patient follow up after discharge.”
If you talk to any hospital physician or family doctor, they would almost certainly agree that this type of integration between hospital and community is essential for reducing avoidable ER visits, readmissions and improving other key health outcomes. Put more simply, it’s just good care.
And so you would think contacting a patient’s family doctor during a hospital admission would be the standard of care - but it’s not. There’s no rule or expectation; rather, it’s just something nice to do.
I’m not here to criticize health care providers who do or don’t act a certain way. I’m sure there are many best practices which some providers do that others don’t, and vice versa.
That said, I don’t think we can deny the harsh truth: It’s no longer about knowing what needs to be done to provide higher quality of care at a lower cost. We know enough answers to begin implementing.
Continue reading “Why Health Outcomes Data Should Directly Feed Back To The Frontline”
Filed Under: THCB
Tagged: Frontline, Measurement, Outcomes, Seamless Mobile Health, Tech
Oct 6, 2014
Writing in the Wall Street Journal (WSJ) Dr. Daniel F. Craviotto Jr. an orthopedist, made a plea to physicians to declare independence from third parties and emancipate themselves from servitude to payers, mandates and electronic health records (EHR).
As rants go, this was a first class rant. But its effect was that of a Charles de Gaulle’s whisper to Vichy France rather than a Churchillian oratory at the finest hour.
The article went viral (it has been tweeted nearly 3000 times), though with little virulence. And it is not WSJ’s paywall to blame.
The author might have assumed that most the healthcare community in general and physicians in particular wish to be free from regulations. I have serious doubts that this assumption is correct in the aggregate. The relationship between regulators and physicians is more complex and symbiotic than it first appears.
Some physicians believe in bureaucracy. Rationalism will march us out of our healthcare wilderness. This belief in scientific managerialism, faith in technocracy, is the new theism. The rationale of the new theists is that regulations fail not because they are inherently useless but because there are so few of them, and even fewer that are actually smart.
Like the first religions started with polytheism, the new believers want more agencies, more alphabet soups, more gods.
Continue reading “Doctor Paul Revere Fails to Light the Fire”
Filed Under: THCB
Tagged: health care delivery, ICD-10, Mandates, Outcomes, Physicians, practice of medicine, Quality improvement, Saurabh Jha
May 13, 2014
Should we be paid for outcomes?
This is often proposed, but I have trouble understanding it. Real outcomes are not blood pressure or blood sugar numbers; they are deaths, strokes, heart attacks, amputations, hospital-acquired infections and the like.
In today’s medicine-as-manufacturing paradigm, such events are seen as preventable and punishable.
Ironically, the U.S. insurance industry has no trouble recognizing “Acts of God” or “force majeure” as events beyond human control in spheres other than healthcare.
There is too little discussion about patients’ free choice or responsibility. Both in medical malpractice cases and in the healthcare debate, it appears that it is the doctor’s fault if the patient doesn’t get well.
If my diabetic patient doesn’t follow my advice, I must not have tried hard enough, the logic goes, so I should be penalized with a smaller paycheck.
The dark side of such a system is that doctors might cull such patients from their practices in self defense and not accept new ones.
I read about some practices not accepting new patients taking more than three medications. In the example I read, the explanation was not having time for complicated patients, but such a policy would also reduce the number of patients exposing the doctor to the risk of bad outcomes.
A few comparisons illustrate the dilemma of paying for outcomes:
Do firefighters not get paid if the house they’re dousing to the best of their ability still burns down?
Does the detective investigating a homicide not get a paycheck if the crime remains unsolved?
Does the military get less money if we lose a war?
Even if we were to accept and embrace outcomes-based reimbursement in health care, how would we measure outcomes?
Continue reading “Doctors Should Be Paid for Outcomes. But Which Outcomes?”
Filed Under: THCB
Tagged: Hans Duvefelt, Outcomes, Physicians
Apr 28, 2014
Recently, The Health Care Blog published a post by Robert Sutton asking why there were so many jerks in medicine.
That posting made the underlying assumption that being a jerk is a bad thing. In response, we are posting today a defense — really more an explanation of the features and benefits — of jerkdom, at least in our segment of healthcare, wellness and outcomes measurement.
In 1976 an obscure graduate student named Laura Ulrich (now a Pulitzer Prize-winning professor) wrote: “History is seldom made by well-behaved women.” That statement could be applied much more broadly. In any field governed by voluntary consensus – especially where the consensus specifically and financially benefits the people making the consensus – radical change does not happen jerklessly.
The best current example might be the critique of Choosing Wisely in the New England Journal of Medicine in which it was pointed out that only three specialty societies blacklisted controversial procedures still performed in significant enough quantity to affect that specialty’s economics.
(Another example of financially fueled consensus gone awry is the RUC, also frequently and justifiably excoriated in The Health Care Blog and elsewhere.)
Specifically, there are three reasons we act like jerks. (Four reasons if you include selling our book, but we acted like jerks well before our book came out.)
First, as Upton Sinclair said, “You can’t prove something to someone whose salary depends on believing the opposite.” Hence, making nice rarely works and may backfire when you are pointing out a total waste that also happens to be someone else’s income.
After Community Care of North Carolina (CCNC) sponsored an outcomes study by Mercer finding massive savings through their patient-centered medical home (PCMH) in an age cohort (children under one year of age) in which no utilization reduction took place and which, as luck would have it, was not enrolled in the PCMH anyway, we kindly wrote to them and offered to show them the error of their ways, privately.
We didn’t get a response. We repeated the offer when they put out another RFP for even more validation, pointing out that using the HCUP database meant no RFP was needed — we would be able to give them an answer in less time than it would take them to evaluate the RFP responses, and save them close to $500,000 in taxpayer money too.
Continue reading “Why Are Al Lewis and Vik Khanna Such Jerks?”
Filed Under: THCB
Tagged: Al Lewis, Health Risk Assessment (HRA), Outcomes, Vik Khanna, Wellness, workplace wellness programs
Apr 24, 2014
Two weeks ago, the Kellogg School of Management was privileged to host Joe Doyle, an outstanding economist from MIT.
In a broad research portfolio, Joe has focused on the effects from differing intensity of medical treatments.
This research is shattering some long held beliefs about the relationship between health spending and outcomes.
We think that Joe’s work is not known widely enough outside of the academic community, so we are using our blog to let you know what you have been missing and, in the process, perhaps change the way you think about healthcare spending.
It is well known that the U.S. far outspends other nations on healthcare, yet the outcomes for Americans (in terms of coarse aggregate measures such as life expectancy, infant mortality, and other dimensions) are quite average.
Of course, these outcomes are not the only things that we value in health care.
A lot of our spending is on drugs and medical services that improve our quality of life and won’t show up in these aggregate outcomes. For example, more effective pain management can decrease pain and improve quality of life – often with important economic benefits.
Despite this fact, most health policy analysts have concluded that we can cut back on health spending, without harming quality on any dimension.
This is not a new idea, of course. In a famous 1978 New England Journal article, Alain Enthoven coined the term “flat of the curve medicine” to describe how the U.S. had reached the point of diminishing returns in health spending. And for nearly 30 years the Dartmouth Atlas has documented how health spending dramatically varies across communities without any apparent correlation with outcomes.
The question has always been, what health spending to cut? Garthwaite’s previous work has shown that broad regulations requiring longer hospital stays for new mothers and their babies have provided only limited benefits and that more targeted rules could save money without sacrificing quality.
Beyond some wasteful regulations, we can always point to gross examples of overspending such as the rapid proliferation of proton beam treatments. But beyond those clear examples how can one identify what is waste and what is medically necessary?
In two important papers, Joe Doyle and co-authors ask a more fundamental question – is the often cited broad variation in health spending actually wasteful at all? They find that even in healthcare, there really is no such thing as a free lunch.
His work should be mandatory reading for everyone who believes that broad spending cuts will have no adverse consequences.
For those who lack the time to read these papers, we provide the “Cliff’s Notes” versions.
Continue reading “Is Higher Spending Truly Wasteful?”
Filed Under: Economics, THCB
Tagged: Craig Garthwaite, Dartmouth Atlas Project, David Dranove, Joe Doyle, Outcomes, spending, Value, Variation
Apr 18, 2014
More than 55 percent of the U.S. population now lives in a local area with an accountable care organization (ACO), in which a group of providers is held accountable by a payer for the total cost and quality of care for a defined set of patients. The spread of ACOs, however, by no means ensures their success.
Significant questions remain about whether the goals of the model—better care at lower costs—will be achieved.
There are some signs that the ACO model—by rewarding provider organizations for implementing high quality mechanisms for care delivery that lower overall costs—is driving innovation in the marketplace. For example, the Montefiore ACO in New York City is using special scales in the homes of patients with congestive heart failure to monitor for changes in weight that could indicate trouble.
Walgreens has formed three ACOs and is using its retail pharmacies as low-cost care centers. In addition, the Beth Israel Deaconess Care Organization created a high-touch care management system in which nurse practitioners visit the ACO’s sickest patients at home to reduce the number of hospital readmissions.
Yet, there are also challenges inherent in the adoption and implementation of the ACO model. There have been several wide-ranging proposals on how to enhance accountable care, especially in Medicare, but we believe that developing policies to standardize measurement is an important first step.
First, we need to promote adoption of a core set of effective measures across payers. Current measures, such as screening for high blood pressure, are limited in scope and fail to incorporate important dimensions, including health outcomes meaningful to patients and the total cost of care for those within the ACO. Proposals for more advanced measures have been developed but not yet adopted, in part because of provider concerns about being held accountable for aspects of performance they do not fully control.
These issues could be addressed by operationalizing the concept of “shared accountability” through patient engagement and partnerships, as with local, multistakeholder community health coalitions, and embracing a core set of more challenging and meaningful metrics, such as functional health and total costs per capita.
Continue reading “Measuring What Matters for ACOs”
Filed Under: THCB, The Business of Health Care
Tagged: Accountable Care Organizations, Elliot Fisher, Janet M. Corrigan, Medicare Shared Savings Program, Outcomes, performance metrics, The Dartmouth Atlas Project, Transparency, William L. Schpero
Feb 4, 2014