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Private Insurance Exchanges––Will They Save Money? Will the Idea Grow?

Oct 9, 2012• 6

By Robert Laszewski

Private health insurance exchanges will save employers money but not make health insurance cheaper.

Because private health insurance will save employers money, they will grow.

Will Private Insurance Exchanges Reduce Health Insurance Costs?

There’s lots of buzz these days about private insurance exchanges. The idea is to give employees more choice in purchasing their own individual coverage from a big menu of insurance companies and plan alternatives, and as a result, create more robust competition and thereby help control costs.

But I think private insurance exchanges will have just the opposite effect on the price of large employer health insurance plans.

First, private insurance exchanges will increase the insurance program expense factor for any large employer plan using them. A large self-insured plan may operate on an expense factor in single digits (maybe 90% of premiums go for claims and 10% of premiums for insurance company overhead). Individual products operate on an expense factor of as much as 20% and small group plans as much as 15%. Moving away from self-insurance and to an individual choice platform will increase the expense factor leaving the employee less money for benefits.

Second, employers currently save a lot of money in a self-insured plan because self-insurance gives the employer more flexibility. For example, a self-insured plan doesn’t have to comply with state benefit mandates. There is widespread agreement that self-insurance flexibility saves employers lots of money and that is why almost 100% of large employers do it. That savings would end, or be reduced, if the employer eliminated its self-insured plan and instead offered a much more complex individual choice platform in an insurance exchange, leaving less money for benefits.

Proponents of private insurance exchanges argue that by pitting many health plans against each other and giving employees these choices we will have a more robust market which will drive health insurance prices down. But it’s dog eat dog out there now in the group health insurance business. Ask a business owner or benefits manager how they market their health insurance and they will tell you they have their consultant or broker regularly get bids from a number of insurers to improve their plan. Most small employers do it every year.

Health 2.0 Code-a-thon – SF Winners

Oct 9, 2012• 4

By Doc Gurley

The San Francisco teams only had 2 days to create a solution and 3 minutes to present. It was a high-stakes, high-pressure event. If known the challenges it was entered for are in parentheses. AT&T, Aetna, Healthline, Food Essentials and athenhealth all offered separate challenges and prizes for this codeathon.

DIG*IT Mobile (AT&T): This app tried to use the “desire engine” concept to develop a medication adherence app specifically for patients with HIV. The app includes a news feed, a way to compare yourself to other people like you, easy contact buttons for providers and a quick health summary. Patients can see a graph of their lab values and their medication compliance, as well as a graph for adherence. Each day the app asks if a patient has taken their medication, as well as providing alerts that tell them to take their meds. The med component showed their pills and when their prescriptions are due. They plan to incorporate crowd-sourcing information later.

DocSays (Aetna & Healthline): This team took on the challenge of improving hospital discharge outcomes. Patients are overloaded with information at the time of discharge. Their app, titled Doc Says, gives them automatic reminders about everything from activity levels, foods, medication to reminders for appointments. It can also work on an SMS system, so it doesn’t have to be smart-phone based. Options on the screen include defining all doctors instructions as tasks. The steps are broken down so that “pick up your lisinopril” is a separate task from the more generic “take your medicine.”

A Tale of Two Keynotes: Futurist Joe Flower and Aetna’s Mark Bertolini

Oct 9, 2012• 4

By Laura Montini

This year at Health 2.0′s Annual Conference, two speakers split stage time during the opening keynote. Joe Flower, a health futurist, and Mark Bertolini, CEO of health insurer Aetna, don’t have a whole lot in common professionally. But in their talks they both made clear that they hold two beliefs in common: the United States health care system needs to react to the country’s cost crisis, and efforts to address health care costs will happen independently from federal reform.

Flower spoke first, laying out the tenets of what he calls the Next Health Care. For such an optimistic speech, it was filled with negatives. Flower went through step by step, talking about what the nation isn’t doing right now, who’s not invested in better care, and why all health care systems can’t just become Kaisers.

Though the talk certainly wasn’t meant to praise health care for all it does right, it was meant to point out the promise that the health care system could be on the brink of.

“Health care is undergoing fundamental economic changes,” Flower said. “These changes are driving us to what may well be better and cheaper health care for everyone.”

The Affordable Care Act isn’t what’s propelling those changes, according to Flower. It’s other factors including an aging population, the sheer cost of care in the U.S., and technological capability that we’ve never seen until now.

Chronic disease accounts for 70 to 75% of all health care costs, Flower said. And as many Americans know, obesity is a huge contributor to those costs. The maps looked at the projection of obesity rates in the U.S. over time, and as the slides passed it looked like the country was being eaten by the disease.

“Now, some of the best hopes for that future, honestly, we see right here at Health 2.0. But we are not there yet,” Flower said.
Continue reading…

Transforming Care Through Transparency

Oct 9, 2012• 5

By Anne Weiss

By year’s end, the Department of Health and Human Services will announce plans for making its Physician Compare website into a consumer-friendly source of information for Medicare patients about the quality of care provided by doctors and other health care providers. In doing so, Physician Compare will take its place alongside Hospital Compare and more than 250 other websites that offer information about the quality and cost of health care. More importantly, perhaps, it will send an important signal that transparency in health care is the new normal.

To look at these 250-plus online reports is to see the good, the bad, and the ugly of the public reporting aspect of the transparency movement. Some make it easy for people to make choices among physicians and hospitals, and just as notably, let providers see where they fall short and need to improve care. But others ask too much, forcing users to sort through rows and rows of eye-glazing data and jargon that requires a medical degree to fathom.

The Affordable Care Act calls for Physician Compare to offer information about the quality of care, including what physicians and their practices did and the outcome for patients, as well as care coordination; efficiency and resource use; patient experience and engagement; and safety, effectiveness, and timeliness. That’s a lot of information, and it demonstrates the tall order facing the federal government to make the reports meaningful and accessible, so that physicians and patients will both be more apt to use them.Continue reading…

Health Plan Case Studies: A New Florida Blue

Oct 8, 2012• 1

By Kent Bottles, MD

One of the perks of giving keynotes all over the country is being able to hear what other health care leaders are saying without having to pay the conference fees. One of my major keynote themes is that everyone (patients, doctors, hospitals, employers, and health plans) will have to change in order to thrive during the current health care delivery system transformation.

Recently in Delray Beach, I stayed after my keynote to hear Florida Blue CEO Patrick Geraghty describe his first year of trying to change the Blue Cross/Blue Shield franchise to respond to health care reform. I have written elsewhere about the health plan response to the changing environment, but Geraghty’s speech highlighted how urgent and how difficult change can be when an industry business model is disrupted by federal legislation and market forces.

Geraghty has led the Blues effort in Florida to update their name, mission, vision, and values. Focus groups revealed that the new name Florida Blue was easier to say and communicated a less corporate, more friendly image than the old name Blue Cross Blue Shield which brought to mind adjectives such as corporate, distant, and expensive.

A four paragraph mission statement was replaced by a single sentence: “To help people and communities achieve better health.” The vision statement was rewritten to now describe the company as “a leading innovator enabling healthy communities.” The five corporate values now include the familiar “respect,” “integrity,” and “excellence,” and the more unusual “courage” and “imagination.”

What I found most intriguing and revealing was how these new efforts are being translated into concrete tactics such as opening retail centers and partnering with Disney on a new innovation institute.

3 in 5 Physicians Would Quit Today If They Could

Oct 8, 2012• 6

By Jane Sarasohn-Kahn

Being a doctor isn’t a happy profession in 2012: 3 in 5 doctors say that, if they could, they’d retire this year. Over three-fourths of physicians are pessimistic about the future of their profession. 84% of doctors feel that the medical profession is in decline. And, over 1 in 3 doctors would choose a different professional if they had it all to do over again.

The Physicians Foundation, a nonprofit organization that represents the interests of doctors, sent a survey to 630,000 physicians — every physician in the U.S. that’s registered with the AMA’s Physician Master File — in March-June 2012. The Foundation received over 13,000 completed surveys back. Findings from these data are summarized in the Foundations report, A Survey of America’s Physicians, published in September 2012.

Morale among physicians is much lower than it was in 2008, as shown in the first chart. Five years ago, less than 1 in 2 doctors would opt to retire; that’s up by over one-third. What’s driving doctors toward pessimism are the least satisfying aspects of practicing medicine in 2012, including:

Concerns about liability, 40%
The hassle of dealing with Medicare, Medicaid and government regulations, 27%. Over 52% of doctors said they’ve limited access to Medicare patients to their practices, or they’re planning to do so.
Lack of work/life balance, 25%
Uncertainty about health reform, 22%
Paperwork, 18%. The survey found that physicians spend over 22% of their time on non-clinical paperwork, resulting in a huge clinical productivity loss.
EMR implementation as a “least satisfying” aspect of work is quite low on the roster of concerns, with only 9% of doctors noting that as a prime concern in 2012.

As a result of uncertainty due to health reform, regulation and finance/reimbursement, the percent of physicians who remain independent will drop to 33% in 2013, Accenture forecasts, from 57% in 2000, 49% in 2005, and 43% in 2009. Aligning with a health system/hospital gives doctors more economic security and fewer administrative hassles.

The Nefarious Big Bird- Health Care Connection

Oct 8, 2012• 4

By Michael Millenson

The flap greeting Mitt Romney’s cheerful admission that as president he’d defund Big Bird’s nesting place on public television could turn out to be good news for a federal agency promoting safe medical care that faces a similar extinction threat. But we won’t know till after the election whether the little-known agency benefited from Big Bird’s protective presence.

The stage was set for Romney’s Big Bird boast by a bill Republicans pushed through a House Appropriations subcommittee in July that slashed or eliminated budgets for a host of programs, including public television’s parent, the Corporation for Public Broadcasting. A committee statement at the time said the move was meant “to encourage CPB to operate exclusively on private funds.” That same bill completely abolished the Agency for Health Care Research and Quality (AHRQ).

Health policy wonks lamented that terminating the agency “would badly undermine important research on health care quality, disparities in care and patient safety,” as a member of AHRQ’s national advisory council put it. But hardly anyone else noticed.

The end of AHRQ didn’t even rate a separate mention in the committee’s lengthy press release. And while Politico reported that a Democratic subcommittee member called it “the only federal agency whose sole mission is to improve the quality, safety and cost efficiency of health care,” the subcommittee’s GOP chairman said, in effect, the death sentence was nothing personal. It was just a budget-balancing action and “not a reflection on anything.”

That’s where Big Bird waddles into the picture.

Rethinking the Provider Certification Game

Oct 4, 2012• 3

By David Shaywitz, MD

Quality is the new watchword in healthcare; it’s what we seek – and increasingly, what we try to measure. Medications, devices, care delivery, hospital services – all are now scrutinized as we seek to gauge their benefit, and justify their cost.

The idea of using metrics to evaluate quality make sense, but only if we can trust the metrics themselves. Otherwise, we risk becoming party to an updated version of craniometry, systematized false-precision that focuses on easily-measurable parameters (such as head circumference) that may not represent meaningful proxies for the assessments we’re really after (i.e. intelligence).

The good news is that the science of testing, of developing evaluation instruments, has improved over time. We’re now better able to recognize the qualities and properties of good tests – and to identify where they’re likely to fall short.

We’re also getting more comfortable with demanding robust evaluation instruments. For example, the FDA’s approach to patient-reported outcomes places exceptional (and appropriate) emphasis on the assessment tool chosen, and requires that it demonstrates the appropriate properties before relying on its results.

Unfortunately, one critically important area within our healthcare system that seems to have escaped such careful review is the way the competence of care providers is typically assessed and certified.

Whether you are an X-ray technician, a physical therapist, a registered nurse, or a transplant surgeon, you are required to pass through a gauntlet of costly certification exams. These tests, already significant, are assuming an even greater importance as the healthcare system increasingly looks to them as proxies for quality. Certification can be required for employment and for admission privileges, and frequently impacts the reimbursement rate for healthcare providers.

All this makes complete sense – provided the certification tests themselves are sound.

Unfortunately, the world of healthcare worker certification remains a bit like the wild west, as medical organizations and professional societies approach certification testing with profoundly different degrees of rigor — and generally little-to-no transparency.

The Health of Nations

Oct 3, 2012• 2

By David Katz, MD

If all of us were simply to make better use of our feet, our forks, and our fingers — if we were to be physically active every day, eat a nearly optimal diet, and avoid tobacco — fully 80 percent of the chronic disease burden that plagues modern society could be eliminated. Really.

Better use of feet, forks, and fingers — and just that — could reduce our personal lifetime risk for heart disease, cancer, stroke, serious respiratory disease, or diabetes by roughly 80 percent. The same behaviors could slash both the human and financial costs of chronic disease, which are putting our children’s futures and the fate of our nation in jeopardy. Feet, forks, and fingers don’t just represent behaviors we have the means to control; they represent control we have the means to exert over the behavior of our genes themselves.

Feet, forks, and fingers could reshape our personal medical destinies, and modern public health, dramatically, for the better. We have known this for decades. So why doesn’t it happen?

Because a lot stands in the way. For starters, there’s 6 million years of evolutionary biology. Throughout all of human history and before, calories were relatively scarce and hard to get, and physical activity — in the form of survival — was unavoidable. Only in the modern era have we devised a world in which physical activity is scarce and hard to get and calories are unavoidable. We are adapted to the former, and have no native defenses against the latter.

Then, there’s roughly 12,000 years of human civilization. Since the dawn of agriculture, we have been applying our large Homo sapien brains and ingenuity to the challenges of making our food supply ever more bountiful, stable, and palatable; and the demands on our muscles ever less. With the advent of modern agricultural methods and labor-saving technologies of every conception, we have succeeded beyond our wildest imaginings.

So now, we are victims of our own success. Obesity and related chronic diseases might well be called “SExS” — the “syndrome of excessive successes.”

OpenNotes: Great News for Patient Engagement!!

Oct 2, 2012

By Dave deBronkart

Regular readers know that we’ve long anticipated the result of the OpenNotes project. Our first post about it was in June 2010: OpenNotes project begins: what happens when patients can see the physician’s visit notes? It tied the issue all the way back to the birth of the Web, in 1994:

The opening anecdote of the e-patient white paper 20th page of this PDF; 23rd page in the Spanish edition tells of a patient who impersonated a doctor in 1994, to get his hands on an article about an operation he was about to have. He got busted.

Two years later episode 139 of Seinfeld had something similar. Kramer impersonates a doctor to try to get Elaine’s medical record.

Now, the Robert Wood Johnson Foundation (RWJF) is funding a study called OpenNotes to explore taking it a big step further: what happens if patients can see, online, every last bit of what their doctors wrote?Do doctors get overwhelmed with questions? Do patients freak out when they read the yucky medical words that doctors write? Does the world go to hell in a handbasket, as some have worried aloud?

The results were released yesterday, in a new article in the Annals of Internal Medicine. (See the OpenNotes website.) Co-lead authors Tom Delbanco MD and Jan Walker, RN, MBA shared a pre-release copy with e-patients.net. They describe the study’s intent: