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Last Week

Sep 25, 2012• 8

By Rob Lamberts, MD

This is it.

Eighteen years of practice is now condensed to my final four days seeing patients in the practice I built. While I am not bitter about what has happened (in fact, a large part of me is delighted), there is a sense of finality in this as one of my life’s major passings. This has been the stage on which I’ve been asked to perform, standing beside the stories of people’s lives and living out my own drama as theirs unfolded. This is where my life most intersected others, where I saw pain and joy, birth and death, suffering and triumph. I helped these people and learned from them in the process. I was teacher and student, helper and helped, healer and healed.

Whether I’ve profited most or gave myself dry (I’ve felt both often), it has been what I’ve done. Now I walk off of that stage onto another one, still dimly lit with little substance. I walk from the known to the unknown, the familiar to the hypothetical. I have great ideas, but now those ideas must become reality, and that reality must work well enough to justify leaving what I have left. Enthusiasm and innovation don’t pay the bills or heal the sick; it takes work.

Shock and Awe: EHRs Work as Designed

Sep 24, 2012• 44

By MARGALIT GUR-ARIE

The health care crowd is abuzz with The New York Times revelation that Medicare billing rates seem to have increased by billions of dollars in parallel with increased adoption of EHR technologies for both hospitals and ambulatory services. The culprit for this unexpected increase is the measly E&M code. Evaluation and Management (E&M) is the portion of a medical visit where the doctor listens to your description of the problem, takes a history of previous medical issues, inquires about relatives that suffered from various ailments, asks about social habits and circumstances, lets you describe your symptoms as they affect your various body parts, examines your persona and proceeds with diagnosing and treating the condition that brought you to his/her office or hospital.

The more thorough this evaluation and management activity was, and the more complicated your problem is, and the more diagnostic tests are reviewed, and the more counseling the doctor gives you, the more money Medicare and all other insurers will pay your doctor. Makes perfect sense, doesn’t it?Continue reading…

Kill the Codes

Sep 23, 2012• 22

By Dr. Wes

Oh, that clever Center for Public Integrity. Look what they’ve gone and done now! My, oh my. According to the article, doctors are much of the the problem, billing “billions” of Medicare upcharges according to the center.

But what if the medical coding game itself is flawed? Stop for a moment and imagine what it would look like if lawyers billed like doctors. Suddenly, we see how bizarre the world of government billing codes and chart-completion mandates has become.

Not long ago I asked readers what my time is worth on a per-hour basis. Collectively and independently, they settled on a number of about $500/hr (see the comments). Now look for a moment at what Medicare pays, even at its highest level of billing for a physician’s time for evlauation and management of a medical problem: for 40 minutes of a physician’s time, it’s $140 (or $210/hr) before taxes. Again, we see another disconnect as to how doctors are valued in our current system.

Doctors are working long hours to collect these fairly low fees from Medicare while jumping more hoops than ever to do so. They have become pseudo-experts at the coding game, trying to get as much money for their extra efforts as legally possible. But these fees paid by Medicare do not cover payments for time spent on phone calls, e-mails, and working insurance denials. These services are still considered by our system as gratis. To partially counteract this coding problem, doctors realized (and the government insisted) that doctors use electronic medical records.

But when independent doctors set out to implement these records they quickly discovered that the expense and long-term maintenance costs of local office-based EMRs could not compete with more sophisticated systems already in use by their neighboring large health care systems. Because of ever-increasing cost-of-living and overhead costs, not to mention the threats of large fee cuts, doctors have migrated to large health systems faster than ever. With the fancier electronic record at those systems (streamlined for billing, collections, and marketing) fields required for higher billing codes (but not always material to the problem at hand) are completed in less time. So are doctors really the problem?

Why Everybody Should Read “Why Nobody Believes the Numbers”

Sep 21, 2012• 1

By Jaan Sidorov, MD

Back in the early 1900s, Albert Einstein had a problem. Sophisticated instruments were unexpectedly showing that the measured speed of light was the same if the source or the observer were moving or stationary. In other words, if one were moving away from a bullet, it should look (to the observer) that the bullet had slowed down. Light’s refusal to conform to the prevailing common sense about how the universe should work ultimately forced Einstein in 1905 to conclude that, in order for the speed of light to be constant, time and mass had to be elastic. This ushered in a new field of relativity mathematics that is still being used to plumb the known universe’s Music of the Spheres.

While the controversies surrounding the effectiveness of “population health management” (PHM) are quite minor compared to Einstein’s Theory of Relativity, the comparison is still instructive. The similar mismatch between what is assumed, what is observed and how to mathematically describe the ultimate truth also underlies Al Lewis’ book, Why Nobody Believes the Numbers. In other words, we assume care management-based patient coaching always yields savings, increasingly sophisticated observations often fail to show it and, as a result, we need new mathematics to reconcile what we assume and what we observe.

Interestingly, author Al Lewis of the Disease Management Purchasing Consortium never doubts the speed of light or that high quality PHM ultimately can save money. While PHM vendors may interpret his long history of skepticism as some sort of shakedown, Al’s passion is clearly evident: Why Nobody Believes the Numbers is ultimately driven by a search for the truth. For that he deserves a lot of credit.

The Trillion Dollar Conundrum

Sep 20, 2012• 61

By David Dranove

In Tuesday’s Wall Street Journal Op-Ed pages, physicians from Harvard and University Pennsylvania Medical Schools criticize subsidies for expanding the use of health information technology (HIT). The physicians cite a recent review article that failed to find consistent evidence of cost savings associated with HIT adoption. If true, this is bad news for the health economy, as supporters claim that HIT could cut health spending by as much as $1 trillion over the next decade.

How can something that is so avidly supported by most health policy analysts have such a poor track record in practice? In a new NBER working paper by myself, Avi Goldfarb, Chris Forman, and Shane Greenstein, we label this the “Trillion Dollar Conundrum.” One explanation may be that most HIT studies examine basic technologies such as clinical data repositories, while most of the buzz about HIT focuses on advanced technologies such as Computerized Physician Order Entry. In our paper, we offer a rather different explanation for the conundrum, one that would have eluded physicians and other health services researchers who failed to consider the management side of HIT.

My coauthors on this paper are experts on business information technology. They are not health services researchers. When I approached them to work on this topic, they insisted on viewing HIT much as one would view any business process innovation. As I have learned, this is by far the best way to study most any issue in healthcare management. Those who advocate that “healthcare is unique” – usually by ignoring broadly applicable theories and methodologies—often strain to explain data that are easily understood using more general frameworks. Such is the case with HIT.

Folly To Forecast Startup Performance?

Sep 19, 2012• 2

By David Shaywitz, MD

Several days ago, Paul Graham, co-founder of noted Silicon Valley accelerator Y-Combinator (YC), wrote an exceptional post, “Black Swan Farming,” observing how crazy difficult it is to predict success in the startup space, and noting that just two companies – Airbnb and Dropbox – account for about 75% of the total value created by all YC-associated companies.

Yesterday, Dave McClure (the white-hot seed-stage Silicon Valley investor, familiar to readers of this column – see this discussion of his small bets style in connection with digital health) responded in a post titled (what else?) “Screw the Black Swans” that his investment model (at 500 Startups) is slightly different.

While most VCs are looking for the big score, McClure said, he’s deliberately seeking singles and doubles, which he basically expects will result in a similar expected value for his portfolio but reduce the chances of getting shut-out. He anticipates and is hoping for a greater number of successes (albeit more modest ones) than achieved by other VCs.

This will be a familiar dialog not only to investors but also to those in biopharma (who perhaps should be thought of as investors as well), as they continuously need to decide whether to go for a risky potential blockbuster or more of a sure-thing that ostensibly may be associated with a smaller market.

I’ve been fascinated with this exact question for a while (see here and here), and I’ve always looked at the problem a bit differently than McClure – which, if I’m right, may actually be good news for him.

Asking the Wrong Questions About the Electronic Health Record

Sep 19, 2012• 35

By Ashish Jha, MD

The wrong question always produces an irrelevant answer, no matter how well-crafted that answer might be. Unfortunately the debate on health information technology seems to be increasingly focused on the wrong question. An Op-Ed in the Wall Street Journal argues that we have had a “Major Glitch” in the use of electronic health records (EHRs). This follows on a series of recent studies that have asked the question “do EHRs save money?” Or “do EHRs improve quality?” with mixed results.

While the detractors point to the systematic review from McMaster, boosters point to the comprehensive review published in Health Affairs that found that 92% of Health IT studies showed some clinical or financial benefit. The debate, and the lack of a clear answer, have led some to argue that the federal investment of nearly $30 billion for health IT isn’t worth it. The problem is that the WSJ piece, and the studies it points to, are asking the wrong question. The right question is: How do we ensure that EHRs help improve quality and reduce healthcare costs?

The fundamental issue is that our healthcare system is broken – our costs are too high and the quality is variable and often inadequate. Paper-based records are part of the problem, creating a system where prescriptions are illegible, the system offers no guidance or feedback to clinicians, and there is little ability to avoid duplication of tests because the results from prior tests are never available. Even more importantly, the paper-based world hampers improvement because it makes it hard to create a learning environment. I have met lots of skeptics of today’s health information technology systems but I have not yet met many physicians who say they prefer practicing using paper-based records.

The problem is that some Health IT boosters over-hyped EHRs. They argued that simply installing EHRs will transform healthcare, improve quality, save money, solve the national debt crisis, and bring about world peace. We are shocked to discover it hasn’t happened – and it won’t in the current healthcare system.

Morgenthaler’s Picks: The Top Twelve Health IT Startups

Sep 18, 2012• 6

By Missy Krasner

Today we announced the 12 startup finalists for the 2012 DC to VC contest. DC to VC is a nation-wide contest to find the most promising health IT startups looking for Seed and Series A ($2-5M+) funding. An annual event started by Morgenthaler Ventures over a 3 years ago to help close the gap between what was going on in Washington D.C. (at ONC, CMS and the White House) and aligned interests in the Silicon Valley on health IT investing, the event has now grown into a large health IT startup competition. Morgenthaler Ventures got interested in this space when they invested in Practice Fusion over 3 years ago (they just invested in Doximity – see funding announcement). I joined as an Executive in Residence (EIR) in January after leaving Google Health and asked Matthew at Health 2.0 to combine forces with us to make the event even bigger–given he was our featured MC last year and will be again this year, too.

This year the application pool was overwhelming; we received over 140 applications to compete in the contest. Our pre-selection judges worked with us to narrow down the applications to the 13 finalists below who will present to a packed room of venture capitalists, angel investors, government officials and entrepreneurs on the last day of the annual Health 2.0 conference on October 10, 2012 in San Francisco, CA. Registration is open to all, so grab your seat fast as the room is getting packed!Continue reading…

How ObamaCare Could Cause Nonprofit Hospitals To Lose Tax-Exempt Status

Sep 18, 2012• 10

By David Whelan

Affordable Care Act (ObamaCare) has been knocked for its alleged unintended consequences. The bill’s attracted speculation that workers will lose their health plans, college grads will stop looking for jobs, and even that fewer people will get married.

Those are just the effects related to insurance regulations. Less attention has been given to how hospitals and health systems might change after ObamaCare.

The most common theory is that reform causes consolidation. But what if the effect on hospitals is even more radical? What if the legislation changes the largely nonprofit nature of the industry?

Right now approximately 60% of the 6,000 or so hospitals in the U.S. are nonprofit, while 25% are government-owned. The rest–fewer than 1,000–are for-profit. There’s a reason the pie cuts this way.

Religious groups, especially Catholic orders, opened many of these facilities as charitable institutions. (Ever driven by a hospital with Mercy in its name?)

Then during the post-war infrastructure boom the federal government offered subsidies to cities that wanted hospitals. Getting the money required nonprofit tax status and a promise to provide “community benefit.”