THCB

Categories

Author Archives

John Irvine

The RUC’s Defense

• 3

By BRIAN KLEPPER

On Wednesday, 47 American medical specialty societies sent Rep. Jim McDermott (D-WA) a letter, with copies to all members of Congress, containing a detailed defense of the American Medical Association’s (AMA’s) Relative Value Scale Update Committee’s (RUC). For 20 years, the RUC has exclusively advised the Centers for Medicare and Medicaid Services (CMS) on physician procedure valuation and reimbursement. On its face, the letter responds to a seemingly minor piece of legislation introduced by Rep. McDermott, H.R. 1256, the Medicare Physician Payment Transparency and Assessment Act, that would require CMS to use processes outside the RUC to verify the RUC’s recommendations on medical services values.

Conspicuously absent from the letter’s signatures were the nation’s three main primary care societies: the American Academy of Family Physicians (AAFP) – which has formally endorsed Mr. McDermott’s bill – the American College of Physicians (ACP) and the American Academy of Pediatrics (AAP). Last week, the New Jersey Academy of Family Physicians sent a letter to its parent organization, AAFP, “strongly encouraging” it to quit the RUC. It is as though the long-compromised primary care physician community, that makes up one third of American physician and handles half of our office visits, is suddenly mobilizing.

The medical societies’ letter is more than a response to just Rep. McDermott’s bill. It also responds to the primary care physician community’s stirrings. Marshaling the influence and discipline of a medical establishment obviously distressed by the prospect of having its economic franchise disrupted, it was the third public defense of the RUC in a little more than a week, following a column on Kaiser Health News by the RUC’s Chair, Barbara Levy MD, and a letter this past Tuesday to Rep. McDermott by AMA CEO Michael Maves. After 20 years of easily-validated intentional obscurity – ask virtually any room of physicians what the RUC is and watch the majority’s blank responses – this open activity favoring the RUC is unprecedented.

The letter is also obviously orchestrated, using many of the same tactics and arguments that Drs. Levy and Maves employed in their defenses. It carefully avoids talking about the abysmal real world consequences of the RUC’s historical approach. It ignores the dramatic under-valuing of primary care, the plummeting rates of medical students choosing primary care, the over-valuing and over-utilization of a wide variety of specialty procedures, and the inherent incentive for the RUC to focus on under-valued rather than over-valued procedures.

Instead, it obfuscates. To counter the McDermott proposal that CMS should use means other than the RUC to assess the RUC’s recommendations, the letter argues that past efforts to use contractors have failed. Therefore, it is senseless to go down this path again.Continue reading…

Time for Toto to Pull the Curtain Away from Patient-Centered Medical Homes

• 23

By AL LEWIS

Patient-Centered Medical Homes in statewide populations have unstoppable momentum and major constituencies in support of them, so valid analysis of their outcomes is probably as futile as it will be unwelcome.  However, the math speaks for itself, at least in the mother of all statewide medical homes, North Carolina Medicaid’s Community Care Access Model.

I write this after having analyzed the actual data from this project’s outcomes report, rather than the stated conclusion of the report, a conclusion that continues to be cited in support of the many states considering or implementing medical home models for their Medicaid populations.

The conclusion makes North Carolina looks like a huge win for PCMH:   $300-million in reported savings.  However, readers should have (but largely didn’t) observe a number of curiosities about the data in support of that conclusion:

(1)    Every element of resource use declined.  People have to be getting their care from somewhere, but inpatient, ER, outpatient, physician, drug, and other expenses somehow all declined vs. trend.

(2)    The decline in physician practice expense is especially counterintuitive:  Why are the doctors so supportive if they are working harder but making less money?

(3)    Even though somehow savings were shown in physician expense, per capita doctor visits did indeed increase.   More concerning was that specialist visits –which are supposed to decline in a PCMH model – also increased.

(4)    Inpatient expense fell 47%.  This was achieved despite the fact that all the AHRQ’s “Ambulatory Care –Sensitive Conditions”  total to about 20% of admissions in most populations.

(5)    The evaluators (William M. Mercer) are on record as saying that “choice [emphasis mine] of trend has a large impact on estimates of financial savings.”  Perhaps it is possible that Mercer, having given themselves this latitude, “chose” a trend that would make the study look good.

Those observations merely suggest that the study was done wrong.    But one other “finding” invalidates the entire study:  the 54% reduction in spending on babies under one year of age, accounting for the majority of the entire $300-milllion in spending.   (Any nontrivial savings whatsoever in this category should have raised eyebrows since PCMH is mostly about managing chronically ill patients.)   The components of spending in that category include physician expense, which should rise since doctors get paid more to be more accessible, and drug expense, which should rise for the same reason.  This means that the entire 54% savings across the category must be concentrated in neonatal expense.   Since neonatal expense is about half of total spending in the age category, it would have to decline by a mathematically impossible 100%+ in order for the category to average a 54% reduction.Continue reading…

Why ACOs Won’t Work

• 68

By ROBERT LASZEWSKI

First, I think Accountable Care Organizations (ACOs) are a great idea. Just like I thought HMOs were a good idea in 1988 and I thought IPAs were a good idea in 1994.

The whole notion of making providers accountable for balancing cost, medical necessity, appropriateness of care, and quality just has to be the answer.

But here’s the problem with ACOs: They are a tool in a big tool box of care and cost management tools but, like all of the other tools over the years like HMOs and IPAs, they won’t be used as they were intended because everybody—providers and insurers—can make more money in the existing so far limitless fee-for-service system.

I see the $2.5 trillion American health care system as a giant health care industrial complex. It just grows on itself and sucks in more and more money. Why not? The bigger it gets the more money we give it.

How do you make it efficient? You change the game. You can’t let it any longer make money just getting bigger. The new game has to be one that only pays out a profit for results—better care for a budget the country can live with. There are lots of tools available to do that. ACOs, capitated HMOs, IPAs, disease management, enormous data mines, Electronic Patient Data Systems, and so on.

But, here’s the rub. There isn’t a lot of incentive for payers and providers to do more than talk about these things and actually make these tools work. Right now they can just make lots more money off the fee-for-service system. They demand more money and employers and government and consumers are willing to just dump more money into the system. Sure they complain about it but they just keep doing it.Continue reading…

Medical Loss Ratios – Again!

• 4

By ROGER COLLIER

A new study, reported in the American Journal of Managed Care, seems likely to add more heat to the continuing medical loss ratio controversy.

The Accountable Care Act effectively mandates that health insurers achieve MLRs of 85 percent for large group business and 80 percent for small group and individual business, with insurers not meeting these thresholds required to make rebates to affected policyholders. However, the ACA allows HHS to issue a waiver if the requirement would disrupt a state’s insurance market. So far, an individual coverage waiver has been granted to the State of Maine, with eight other states’ waiver requests being considered. The study reported by AJMC examined individual coverage data from health insurer filings to state regulators, as reported to the National Association of Insurance Commissioners. For each state (except California, where most health insurers report to a state agency other than the Insurance Commissioner), the study computed the number of individuals with coverage (in terms of enrollee-years), the number of insurers offering coverage, and the medical loss ratios (recomputed to reflect differences between ACA’s definition of MLR and that used by the NAIC).

Based on this data, the study went on to estimate the number of enrollees in plans failing the ACA’s 80 percent threshold, and the number of higher-risk individuals who might have difficulty in finding coverage if their insurer exited the market. At first sight, the findings seem dramatic and very different from the expectations of the MLR provision’s Senate authors. The AJMC article estimates that in nine states (Arkansas, Illinois, Louisiana, Nebraska, New Hampshire, Oklahoma, Rhode Island, Wyoming, and West Virginia) at least half of the individual health insurers missed the 80 percent threshold in 2009, while in twelve states (Arkansas, Arizona, Florida, Illinois, Indiana, New Hampshire, Nevada, South Carolina, Tennessee, Texas, Virginia, and West Virginia) more than half of the enrollees were covered by insurers failing the standard, with some two million individuals nationally covered by such insurers. The study then projected that overall more than a hundred thousand enrollees (with more than ten thousand in each of Florida, Illinois, Texas, and Virginia) would find it difficult or impossible to find coverage if their non-MLR-compliant insurers exited the market. If the study’s findings are accurate, somewhere between a dozen and twenty states could reasonably demand waivers of the individual market MLR standard.

However, as the authors note, there were significant study limitations as well as possible source data inaccuracies. Enrollment in health plans offered by life insurers was generally omitted, as was all data from California. Additionally, the findings are dependent on state reporting to the NAIC, something that some of the data shown in the article suggests may be unreliable. For example, Maine—the only state so far granted an MLR waiver—is shown as having an average MLR well above the 80 percent threshold, while insurers in Michigan are shown as having an average MLR in excess of 1.0 in both 2002 and 2009—an unlikely consistently money-losing trend in a large state. Continue reading…

The ACO Rules & Privacy

• 23

By MARGALIT GUR-ARIE

One day before the first of April, HHS published the much anticipated rules defining the creation and operations of Accountable Care Organizations (ACO) spanning 429 pages of business regulation, analysis of various options available, proposed solutions and ways to measure and reward (punish) success (failure) in achieving HHS seemingly incompatible goals of providing better care for less money. I am fairly certain that health policy experts, health care economists and the multitude of industry stakeholders will be dissecting and analyzing the hefty document in great detail in the coming weeks. I started reading the document with an eye towards the ACO implications for HIT, which as expected are many, but something on page 108 made me stop in my tracks. HHS is proposing to share personally identifiable health information (PHI) contained in Medicare claims with ACO providers unless patients “opt-out”.

Beginning on page 108 and through 22 pages of tortured arguments, HHS makes the case for the legality and benefits of providing ACOs with PHI contained in Medicare claims, unless the patient actively withdraws consent for this type of transaction. The argument for the legality of claim data sharing rests on the nebulous HIPAA clause which allows disclosure of PHI for “health care operations” within a web of covered entities and business associates connecting the ACO with Medicare and other providers of health care services for a particular patient. HHS is proposing to make available four types of medical information to participating ACOs:Continue reading…

First Impressions of the Medicare ACO Rule

• 7

By VINCE KURAITIS

On March 31, CMS released the long-awaited “Medicare Shared Savings Program: Accountable Care Organizations” document (ACO Rule). Read the details here (strong suggestion: unless you’re working on your PhD in ACOs, start with the fact sheets).

There are many surprises. Here are eight first impressions on this 429 page tome:

  1. The bar has been set high…very high.  Tire kickers need not apply.
  2. Don’t expect to see many or any small ACOs.
  3. Patients will be confused by ACOs.
  4. Concerns over maintaining competition and avoiding antitrust are being taken seriously.
  5. CMS scores points for coordinating the ACO Rule across Federal agencies.
  6. CMS loses points for micromanagement and a controlling mindset.
  7. Possible losers — hospitals, ACO vendors.
  8. Possible winners — physicians, health plans.Continue reading…

Minor League Report Cards

• 5

By DAVID DRANOVE

I was pleased to see the Chicago Tribune carry an op-ed piece this week by my friend and colleague Michael Millenson. The gist of the piece was that information about hospital quality is readily available online and we should use that information when choosing a hospital. Michael is right — there is no shortage of places to turn to get information about hospital quality. But I think he waxes too enthusiastic.

For one thing, it is not clear whether the widespread availability of quality information is a boon or a problem. Consider Medicare’s Hospital Compare website. Look up quality information for pneumonia and you are overwhelmed with nearly 20 different measures on four different web pages. I couldn’t possibly make sense of all this information even if I used sophisticated computer software; how could the average person sort through it all? One quality measure seems to stand out – mortality. But I wonder if this should be a major concern for pneumonia patients. Are we talking about 5 percent mortality rates, or 0.05 percent? I don’t know and Medicare won’t tell me.

HealthGrades.com is much simpler – it just reports mortality. The widely respected Leapfrog Group reports mortality for pneumonia and also reports another 8 general hospital quality measures, some of which are derived from even more measures.

When reading these report cards I find that my local hospital in Highland Park scores very well on mortality in the HealthGrades and Leapfrog reports but I can’t find it anywhere at the Medicare website. And I wonder if the low mortality rate is due to the hospital or due to the demographics of the patients. Michael Millenson pointed out that these report cards are risk adjusted, but he failed to mention that the available risk are pretty lousy – mostly controls for age, sex, and a few comorbidities. (Much better risk adjustment is possible but requires data not available to Medicare, HealthGrades, or Leapfrog.) Hospitals that get poor quality scores often report that their patients are sicker than the risk adjusters give them credit for. They might be right. Hospitals that get good scores never claim that their patients are healthier. Maybe they are hiding something.Continue reading…

Save Money on Medical Costs – Get Your Old Medical Records

• 23

By DAVIS LIU, MD

There are many tips to saving money on medical costs like asking your doctor only for generic medications, choosing an insurance plan with a high deductible and lower monthly premiums, going to an urgent care or retail clinic rather than the emergency room, and getting prescriptions mailed rather than go to a pharmacy.

How about getting your old medical records and having them reviewed by a primary care doctor?  It might save you from having an unnecessary test or procedure performed.

Research shows that there is tremendous variability in what doctors do.  Shannon Brownlee’s excellent book, Overtreated – Why Too Much Medicine Is Making Us Sicker and Poorer, provides great background on this as well as work done by the Dr. Jack Wennberg and colleagues on the Dartmouth Atlas. Some have argued that because of the fee for service structure, the more doctors do the more they get paid.   This drives health care costs upwards significantly.  Dr. Atul Gawande noted this phenomenon when comparing two cities in Texas, El Paso and McAllen in the June 2009 New Yorker piece.

Between 2001 and 2005, critically ill Medicare patients received almost fifty per cent more specialist visits in McAllen than in El Paso, and were two-thirds more likely to see ten or more specialists in a six-month period. In 2005 and 2006, patients in McAllen received twenty per cent more abdominal ultrasounds, thirty per cent more bone-density studies, sixty per cent more stress tests with echocardiography, two hundred per cent more nerve-conduction studies to diagnose carpal-tunnel syndrome, and five hundred and fifty per cent more urine-flow studies to diagnose prostate troubles. They received one-fifth to two-thirds more gallbladder operations, knee replacements, breast biopsies, and bladder scopes. They also received two to three times as many pacemakers, implantable defibrillators, cardiac-bypass operations, carotid endarterectomies, and coronary-artery stents. And Medicare paid for five times as many home-nurse visits. The primary cause of McAllen’s extreme costs was, very simply, the across-the-board overuse of medicine.

Doctors apparently seemed to order more tests.  Patients, not surprisingly, agreed.  After all, without adequate medical knowledge or experience, how sure would you be if a doctor recommended a test and you declined?Continue reading…

How the Veterans are Winning the War

• 2

By PAUL LEVY

At a seminar last night at the Center for Public Leadership at Harvard’s Kennedy School, one of the students asked a question along the lines of, “How do you know when you have done too much with regard to transparency?” My answer was that the question presupposed the wrong approach to transparency, that it was being driven by the CEO without proper attention to the efficacy and appropriateness of what was being measured and disclosed. Instead, I suggested that it should be driven by the leadership of the organization, but based on metrics that were viewed as useful and appropriate by the clinical staff. In such an instance, transparency serves the function laid out by IHI’s Jim Conway, as summarized here in an article discussing the BIDMC experience:

[P]ublic reporting created what management guru Peter Senge calls creative tension, a key in getting an organization to change. Announcing a daring vision — the elimination of patient harm — combined with honestly publicizing the problems, fuels improvement, he said.

I expressed the concern last night that the general recalcitrance of the medical profession about engaging transparency will inevitably lead to fiats about disclosure from government regulatory agencies. The problem with those fiats is that they will be grossly constructed and force hospitals and doctors to focus on the wrong things, in a manner not consistent with widely established principles of process improvement. (See, for example, this approach in Maryland.)

Now comes the Veterans Administration, proving the case with panache! You may recall my complimentary post on the VA back in January. Thomas Burton’s article this week in the Wall Street Journal — “Data Spur Changes in VA Care” — documents this in more detail. Some excerpts:

Hospitals serving U.S. military veterans are moving fast to improve care after the government opened a trove of performance data—including surgical death rates—to the public.

The information was released at the urging of VA Secretary Eric K. Shinseki. Among other things, it presents hospitals’ rates of infection from the use of ventilators and intravenous lines, and of readmissions due to medical complications. The details have been adjusted to account for patients’ ages and relative frailty.

“Why would we not want our performance to be public? It’s good for VA’s leaders and managers, good for our work force, and most importantly, it is good for the veterans we serve,” Mr. Shinseki said in an emailed statement.

At VA hospitals in Oklahoma City and Salem, Va., the rate of pneumonia acquired by patients on ventilators was shown last fall to be significantly higher than the national VA average. The Salem hospital says a relatively low number of patients on ventilators skewed its infection rate higher, but staff members at both facilities say the numbers prompted action.

Seeing the data helped, says the Salem hospital’s chief of surgery, Gary Collin, because “you can become kind of complacent.”Continue reading…

The Thing to Watch in the Medicare ACO Regulations

• 6

By VINCE KURAITIS

Health care lobbyists and advocates are bracing for six pages of the health care reform law to explode into more than 1,000 pages of federal regulations when the Department of Health and Human Services releases its long-delayed accountable care organization rules this week. Politico

What should you be looking for as you snuggle by the fireplace this weekend reading the draft ACO regs?

Rob Lazerow writes a helpful article listing 5 Things to Watch in the Medicare Shared Savings Program Proposed Rule. His list of five key design issues includes:

  1. How will patients be assigned to ACOs?
  2. To what cost benchmark will ACOs be compared?
  3. How will bonuses be calculated and paid?
  4. For which quality metrics will ACOs be responsible?
  5. What is the application process?

I’d like to add a sixth  item — which actually would be #1 on my list.

As I’ve previously written, IMHO the central issue around ACOs is:

Are (hospitals and doctors) viewing ACOs as a way to truly develop patient centric, collaborative care or as a means toward consolidating market power against payers? We really don’t know.Continue reading…

assetto corsa mods