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Month: August 2010

W(h)ither Insurers?

• 16

By PAUL LEVY

Levy

The talk around the country among health insurance companies is that their insurance business is dying.

What is happening? First, the consolidations in other industries, resulting in large, multistate corporations, already mean that many companies self insure their employees. Even many local firms have large enough work forces that they can be self-contained risk pools. (One source I found says that in 2008, 89 percent of workers employed in firms with 5000 or more employees were in self-insured plans.) There is no sense compensating insurance companies for actuarial risk when your employee base is that large. Instead, the insurance companies or other firms are hired solely to administer the benefit plans.

For those insurance markets that still exist, the provisions for transparency under the national health care reform law, and the insurance exchanges that will be set up, will result in the commoditization of insurance products. That commoditization will drive down the profit margins that would otherwise exist in this market segment.

The result is that health insurance companies will become financial services organizations more than insurance entities. Think of them as another form of banking, where minimizing transaction costs becomes imperative, and where the use of derivatives and other hedges makes the difference in who makes money and who doesn’t.

This, in turn, also implies that scale matters. Like banks and credit card companies, the larger ones incur a lower cost for each transaction. Several years ago, I was told that the minimum size needed to be a successful insurance company was two million subscribers. That was before the national health reform bill passed.Continue reading…

Fun in San Diego next week: mHealth & Healthcamp

By Matthew Holt

Next week there’s post-Labor day health care fun in San Diego. The 2nd mHealth Networking Conference is Sept 8-9 and Healthcamp San Diego is the day before (Sept 6). Both are run by good health care friends—Peter Waegemann and Claudia Tessier (who used to run TEPR) now run the mHealth conference, and Gregg Masters is running Healthcamp.

There do seem to be rather a lot of mHealth conferences this year—I won’t start talking here about my disdain for the term—but this is the one in the nicest place and is probably the best value for money! And the keynote is another friend and very interesting techie doctor, S. Cal Permanente Group’s CMIO John Mattison.

Check out the conference program for details and online registration to the mHealth Conference. And sign up for the almost free Healthcamp unconference the day before.

The Accidental Socialists

• 62

By DAVID DRANOVEDranove_foreman

Over the next few years, the U.S. healthcare system will be in the hands of academics from Cambridge, Massachusetts. New CMS Czar Donald Berwick was a member of the Harvard Medical School faculty. Joe Newhouse, who has been the senior adviser to Medicare for as long as I can remember, holds appointments in three different schools at Harvard. David Cutler, Dean of Harvard’s Undergraduate College, seems a good bet to lead the Independent Medicare Advisory Board. Countless of their colleagues and former students have taken key policy making positions in Washington.

I know most of these scholars. They are brilliant as a rule and are acting in the truest sense of public service. None of them are socialists in the usual sense of the word; they do not believe that the government is an efficient provider of most goods and services. I don’t think they want the government to provide health care either. They have never called for government ownership of hospitals or suggested that physicians join the civil service. But whether they realize it or not, they are the vanguard of a movement bringing socialized medicine to America.Continue reading…

Running Behind

• 10

By ROB LAMBERTS

Rob Lamberts

I walk into the exam room and the patient looks up at me with a surprised expression.  ”Wow!  I didn’t expect to see you so quickly!”

I smile and turn around to walk out of the door, saying: “Sorry!  I’ll leave then and come back later.”

“No, no!”  They respond, smiling.  ”I’m happy to see you so soon.  It’s just a surprise.”

I walk back into the room with a smirk.  ”I just don’t want to offend you by being on time.  I’ll try to do better next time.”

I am not sure if I should be happy or sad with such an interchange.  On one hand, it feels good to stay on time with my appointments, holding up my end of the bargain of the schedule.  On the other hand, the patient’s surprise betrays the fact that this is not the usual state of affairs.  And it isn’t.  I generally don’t run on time and don’t expect to run on time.

When I first started practice, the stated objective was to get the person out of the office within an hour of their scheduled appointment.  This seemed a blend of realism and responsibility.  At first it was easy to stay up on things.  My schedule was sparsely filled, so I could make up time.  After sixteen years of practice, however, my schedule almost never has open slots; when it does have openings, they are quickly filled.  I still try to get them out within an hour.Continue reading…

Medicaid EHR Incentives – A Learning Experience

• 12

By MARGALIT GUR-ARIE 

By now almost everybody that has any remote interest in Health Care is aware of the much publicized incentives made available to health care providers for the adoption and meaningful use of certified EHR technology. The most quoted number is $44,000 to be paid by CMS to Medicare physicians. Practically every EHR vendor website is adorned with a Flash banner “educating” doctors on this cash windfall, and practically every HIT detractor is warning that the incentives are just a pittance compared to the real costs of ownership of a certified EHR. Very rarely does anybody go into the intricacies of the available incentives for Medicaid providers, which are almost 50% higher than Medicare and involve clinicians providing care to our most vulnerable citizens. However, there is much to learn from the structure of the Medicaid incentives program.

The HITECH statute sets forth a “net” average allowable cost for purchasing and implementing an EHR at $25,000 for the first year and $10,000 for subsequent years. Of this “net” allowable cost, the Secretary of HHS is authorized to pay Medicaid Eligible Providers up to 85% in stimulus incentives for a total of 6 years. It appears that the Government is about to pay you 85% of your EHR costs for the next 6 years, which is a pretty good deal. Looks, however, can be deceiving. As any early adopter of EHR knows, the total cost of ownership for an EHR over 6 years is well over the “net” allowable of $75,000 set forth in the HITECH Act, and Congress knew that too. This is why the statute instructs the Secretary of HHS to determine the actual average allowable costs of EHR:Continue reading…

A Meaningful Use and Standards Rule FAQ Part II

• 2

By JOHN HALAMKA
John Halamka

As a followup to the HIMSS Webinar I gave last week, here’s an FAQ in the spirit of last month’s Meaningful Use and Standards Rule FAQ.

1. The Emergency Department is mentioned in 9 Core Measures and 3 Menu Measures, yet industry discussions seem to focus on the ED for CPOE and Discharge instructions. What functions do ED Information Systems need to support? Are these functions for just admitted patients or all ED Patients?

In my conversations with CMS, I believe that CMS will be issuing a corrections notice to clarify the role of the ED in the rule.Continue reading…

Health Reform Without Apologies

• 23

By JOHN GOODMANGoodman, PhD

Have you ever seen a fair, unbiased, evenhanded explanation of the Patient Protection and Affordable Care Act? Have you ever seen anything that even appeared to be objective? I haven’t.

So to fill the gap, my colleagues and I have produced “What Does Health Care Reform Mean To You? A Consumer’s Guide,” which explains how the new health care overhaul works, in a question-and-answer format. You can also get a pamphlet version— ideal for doctors’ offices, clinics, work places and everywhere else that people meet and socialize.

That it’s the first effort anyone has made to even try to be objective is in itself rather amazing. See if you agree on whether we succeeded and give us your comments.

During the nine-month period leading up to the passage of the Patient Protection and Affordable Care Act (PPACA), Americans were subjected to more than $200 million worth of TV, radio, newsprint and Internet ads. Almost all of these — pro and con — were pure propaganda.Continue reading…

The New Frontier of Medicine?

By ALLEN L. GEE, MD, PhD, FAANAllen Gee MD

I hear the same sentiment frequently from my physician colleagues. They’ll say something like, “I am just an expensive data entry person.”

All the bells and whistles, drop-down boxes and multiple windows to navigate in their electronic health record (EHR) require them to focus more on the technology than the patient. Contrary to intent, technology is slowing them down and distracting them. A lot of self-employed physicians using an EHR as well as those working on a production basis will feel this pain.

Rest assured my friends, it is not just you and your inability to use a computer or to change your workflow—as IT experts and administrators would have us believe. The EHR industry has failed to deliver the solutions. Could this possibly be the reason so many doctors have failed to adopt an EHR? (In 2007, the U.S. Office of National Coordinator for Health IT reported that about 50% of EHR implementations failed.)

Continue reading…

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