Month: September 2010

Building a Better Mousetrap

Sep 13, 2010• 23

By JOHN C. GOODMAN, PhD

The story was front page and above the fold in The New York Times. Six teachers in Newark are leaving the traditional school system to start a public school of their own.

If the product was something other than education, this would have been no news at all. I would guess that the vast majority of businesses in this country were started by people who walked away from an employer, convinced that they could make a better product on their own. Teachers rarely have the opportunity to do the same, however. They are usually trapped in a system that does not allow innovation or experimentation and is ordinarily hostile to entrepreneurship.

What does all this have to do with health care? A lot. Doctors are just as trapped as teachers. And that is the most important defect in the health care system.

This, of course, is not the conventional view. The received wisdom in the health policy community is that doctors have too much freedom, not too little. Witness the wide variation in medical practice patterns — from city to city and region to region — all seemingly unrelated to medical outcomes. How can anyone defend that? Certainly not me. Where I part company with so many of my colleagues is that they blame the doctors for this problem — I blame the third-party payers.

Were we to look into the matter, I’m sure we would find wide variations in the practice of teaching from school to school, district to district and state to state. Yet I still maintain the teachers are essentially trapped. This may appear to be an oxymoron, but it’s really not. Both in education and in health care, the practitioners have a great deal of freedom to waste resources. But they have virtually no freedom to profit by discovering innovative ways of lowering costs and raising quality.

Interview: Highmark introduces private label ADAM iphone app

Sep 12, 2010• 3

By Matthew Holt

A few weeks back Highmark, the big Pennsylvania Blues plan, became one of the first major US insurers to introduce a local navigational iPhone app—a white labeled version of the ADAM tool formerly known as Medzio. I caught up with Steffan Johnson, the Consumer Lead at Highmark responsible for the app to talk about why they did this and where insurers like Highmark might be heading. (And in a technical note, I’ve gone back to transcribing interviews rather than putting up the audio. Let me know what you think. Do you like the transcript or the audio or both? Please answer in the comments)

Matthew Holt: I am talking with Steffan Johnson. Steffan’s formal title is the Senior Consumerism Lead at Highmark. Highmark of course is the big Blues Plan, that was Blue Cross of Western Pennsylvania and Pennsylvania Blue Shield, but is now a Delaware regional insurer in Pennsylvania, and one of the biggest Blues plans overall. Steffan, good morning! Actually, good afternoon for you!

Steffan Johnson: Good morning Matthew!

Matthew: The reason I have got you on here is that you guys have just done a deal with a company that we know well at Health 2.0 called A.D.A.M. This is actually the continuation of something that A.D.A.M. introduced back in early 2009, so a little while ago. And A.D.A.M. has been through some changes, not the least of which is they got purchased by another company this morning, which I just found out about

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Sep 12, 2010

Front-Line Managers are Key to Wellness Program Participation

Sep 11, 2010• 8

By TOM UNDERWOOD

What’s the difference between a company with a high participation rate in wellness programs and a low one? As it turns out, front-line managers—the people who run the daily operations and work the most closely with their colleagues—are actually the ones who can have the most influence, and can best help improve their company’s wellness participation rates.

Finding the answer to increasing wellness participation has vexed employers for years. We’ve done a good job at getting younger, healthier employees to participate in wellness. And employers recognize and appreciate the benefits of comprehensive and integrated wellness programs.

But we haven’t quite found out how to motivate people who have tried and failed or those who have multiple conditions and don’t think anything can help; who think they are too busy; or who simply would rather go home and have a pizza, six pack and watch TV.

Unfortunately it’s individuals with poor lifestyle habits who are costing employers the most. On average, for every $1 of medical and pharmacy costs there is about $2.3 of health-related productivity costs that employers must pay—and that figure is much greater for some conditions. We must find ways to get these non-participants in wellness programs motivated and involved –- for our good—and theirs.

Back to the role of managers; we work with large employers and health plans nationwide. Several times a year we meet with employers at a Summit to share best practices as well as research and analysis we’ve conducted on outcomes from specific health and wellness programs. There’s a good cross section of employers at the Summit who struggle every day to find ways to hold down costs and help their workers become healthier and more productive.

Consumers to Pay More Under Reform

Sep 10, 2010• 32

By MERRILL GOOZNER

The latest analysis of health care reform – out this week from bean counters at Medicare – shows reform will raise health care spending slightly over the next 10 years, not reduce it as promised by President Obama. That won’t make selling it on the stump any easier. Yet there’s a glimmer of hope in the out years of the 10-year projection that the plan will begin to “bend the cost curve.”

Here’s the real bad news for reform supporters. The private insurance market will absorb most of the increase, and most of that will fall on individuals. Employer contributions for their workers’ private insurance will actually fall $120 billion in 2019 from previous projections because of reform.

Individuals will get hit two ways. First, the actuaries at CMS are projecting a huge 9 percent increase in out-of-pocket expenses in 2018 and 2019, after the so-called “Cadillac tax” goes into effect. This is a steep excise tax on high-cost insurance plans. To avoid tax penalties, experts expect employers with such plans – which may only be high-cost because they are filled with sicker and older beneficiaries – will reduce coverage by increasing co-pays and deductibles.

A second factor driving out-of-pocket expenses higher for individuals under reform will be the insurance mandate, which will drive many people to seek coverage through the new state exchanges. CMS predicts over 30 million people will be getting insurance through the exchanges in 2019, substantially more than the 24 million projected by the Congressional Budget Office last March, when reform passed.

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Sep 10, 2010

Hyperventilating about the Harvard/Health Affairs Malpractice Study

Sep 10, 2010• 9

By DAVID DRANOVE

A new study from an interdisciplinary team at Harvard University reports that the medical malpractice system costs close to $60 billion annually. The study is published in the policy journal Health Affairs and is receiving lots of attention in the media. The attention is unwarranted. The study is old news, of questionable validity, and prone to misinterpretation. But that hasn’t stopped the medical lobbying complex from hyperventilating about the findings and renewing its call for massive tort reform.

The study provides no surprises to anyone in the health research or health policy arena who pays attention to malpractice. All of the data are in the public domain and most have been reported in previous studies. (For the past decade I have reported essentially the same findings in my health economics class.)

The most important component of malpractice costs is defensive medicine. The Harvard authors put this at $46 billion, or nearly 80 percent of the total, but this is pure guesswork. Researchers cannot agree on the extent of defensive medicine. The Harvard authors base their estimates on seminal studies by Kessler and McClellan. Their work is seminal largely because it was first, not because it was definitive, and later studies often find far less evidence of defensive practice. The Harvard authors try to be conservative by using the low end of the Kessler/McClellan cost estimates. But truth would have been better served if they had stated that the cost of defensive medicine could just as easily be $16 billion or $76 billion.Continue reading…

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Sep 10, 2010

Primary Care is Not a Panacea: It Takes a Team

Sep 10, 2010• 4

By MAGGIE MAHAR

The emphasis on primary care as the “key” to lifting the quality of U.S. healthcare may be exaggerated according to a report, released today, by Dartmouth’s Institute for Health Policy & Clinical Practice.

“Primary care forms the bedrock of a well-functioning, effective health care system,” the researchers observe. But– and this is an important caveat- “simply increasing access to primary care, either by boosting the number of primary care physicians in an area or by ensuring that most patients have better insurance coverage, may not be enough to improve the quality of care or lead to better outcomes.”

Wait a minute. In past reports, didn’t Dartmouth’s researchers tell us that patients fare better if they see fewer specialists and more internists?

No. Dartmouth’s earlier studies have shown that when patients see more specialists, care is more aggressive and more expensive, but, on average, outcomes are no better—and sometimes they are worse. This, however, doesn’t mean that primary care, by itself, ensures better care, even if a patient sees her PCP on a regular basis.

As the report points out: “Primary care is most effective when it is embedded in a high-functioning system, where care is coordinated, where physicians communicate with one another about their patients, and where feedback is available about performance that allows physicians and local hospitals to continually improve.”

Policy should “focus on improving the actual services primary care clinicians provide and making sure their efforts are coordinated with those of other providers, including specialists, nurses and hospitals,” says Dr. David C. Goodman, lead author and co-principal investigator for the Dartmouth Atlas Project.

Health 2.0–The Fall Conference is going to be great!

Sep 9, 2010• 1

By Matthew Holt

Health 2.0 is pleased to announce our (almost) final line-up for the Fourth annual Health 2.0 Conference in San Francisco, October 7-8. Since we started the series in 2007, Health 2.0 has become the leading showcase of cutting-edge technologies in health care, including Online Communities, Search and lightweight Tools for consumers to manage their health and connect to providers online. This year’s conference is the climax of Health Innovation Week, a week highlighting innovation in health care information technology. We’ve been reviewing the cream of the crop of demos and new arrivals and just a few agenda highlights include:

Keynotes from the Godfather of Web 2.0, Tim O’Reilly and America’s leading health futurist, Jeff Goldsmith.
The introduction of Sharecare. Jeff Arnold, original founder of WebMD, has partnered with Dr. Oz, Discovery, Harpo, Sony and a host of content contributors to create the most anticipated online health offering in years.
The wraps coming off Castlight Health. CEO Gio Collella has raised $80 million in venture capital and has ambitious aims to change the way we buy healthcare.
The presentation for the winners of the Health 2.0 Developer Challenge from Federal CTO Aneesh Chopra and the CTO of HHS Todd Park.