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Category: Health Policy

How are hospitals supposed to reduce readmissions? Part III

By KIP SULLIVAN, JD

The Medicare Payment Advisory Commission (MedPAC) and other proponents of the Hospital Readmissions Reduction Program (HRRP) justified their support for the HRRP with the claim that research had already demonstrated how hospitals could reduce readmissions for all Medicare fee-for-service patients, not just for groups of carefully selected patients. In this three-part series, I am reviewing the evidence for that claim.

We saw in Part I and Part II that the research MedPAC cited in its 2007 report to Congress (the report Congress relied on in authorizing the HRRP) contained no studies supporting that claim. We saw that the few studies MedPAC relied on that claimed to examine a successful intervention studied interventions administered to carefully selected patient populations. These populations were severely limited by two methods: The patients had to be discharged with one of a handful of diagnoses (heart failure, for example); and the patients had to have characteristics that raised the probability the intervention would work (for example, patients had to agree to a home visit, not be admitted from a nursing home, and be able to consent to the intervention).

In this final installment, I review the research cited by the Yale New Haven Health Services Corporation (hereafter the “Yale group”) in their 2011 report to CMS in which they recommended that CMS apply readmission penalties to all Medicare patients regardless of diagnosis and regardless of the patient’s interest in or ability to respond to the intervention. MedPAC at least limited its recommendation (a) to patients discharged with one of seven conditions/procedures and (b) to patients readmitted with diagnoses “related to” the index admission. The Yale group threw even those modest restrictions out the window.

The Yale group recommended what they called a “hospital-wide (all-condition) readmission measure.” Under this measure, penalties would apply to all patients regardless of the condition for which they were admitted and regardless of whether the readmission was related to the index admission (with the exception of planned admissions). “Any readmission is eligible to be counted as an outcome except those that are considered planned,” they stated. (p. 10) [1] The National Quality Forum (NQF) adopted the Yale group’s recommendation almost verbatim shortly after the Yale group presented their recommendation to CMS.

In their 2007 report, MedPAC offered these examples of related and unrelated readmissions: “Admission for angina following discharge for PTCA [angioplasty]” would be an example of a related readmission, whereas “[a]dmission for appendectomy following discharge for pneumonia” would not. (p. 109) Congress also endorsed the “related” requirement (see Section 3025 of the Affordable Care Act, the section that authorized CMS to establish the HRRP). But the Yale group dispensed with the “related” requirement with an astonishing excuse: They said they just couldn’t find a way to measure “relatedness.” “[T]here is no reliable way to determine whether a readmission is related to the previous hospitalization …,” they declared. (p. 17) Rather than conclude their “hospital-wide” readmission measure was a bad idea, they plowed ahead on the basis of this rationalization: “Our guiding principle for defining the eligible population was that the measure should capture as many unplanned readmissions as possible across a maximum number of acute care hospitals.” (p. 17) Thus, to take one of MedPAC’s examples of an unrelated admission, the Yale group decided hospitals should be punished for an admission for an appendectomy within 30 days after discharge for pneumonia. [2]

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The good, the bad, and the hopeful in new interoperability plans from Washington

Claudia Williams, Manifest MedEx, Amazon

By CLAUDIA WILLIAMS

Robust exchange of health information is absolutely critical to improving health care quality and lowering costs. In the last few months, government leaders at the US Department of Health and Human Services (HHS) have advanced ambitious policies to make interoperability a reality. Overall, this is a great thing. However, there are places where DC regulators need help from the frontlines to understand what will really work. 

As California’s largest nonprofit health data network, Manifest MedEx has submitted comments and met with policymakers several times over the last few months to discuss these policies. We’ve weighed in with Administrator Seema Verma and National Coordinator Dr. Don Rucker. We’ve shared the progress and concerns of our network of over 400 California health organizations including hospitals, health plans, nurses, physicians and public health teams. 

With the comment periods now closed, here’s a high-level look at what lies ahead: 

CMS is leading on interoperability (good). Big new proposals from the Centers for Medicare and Medicaid Services (CMS) will set tough parameters for sharing health information. With a good prognosis to roll out in final form around HIMSS 2020, we’re excited to see requirements that health plans give patients access to their claims records via a standard set of APIs, so patients can connect their data to apps of their choosing. In addition, hospitals will be required to send admit, discharge, transfer (ADT) notifications on patients to community providers, a massive move to make transitions from hospital to home safe and seamless for patients across the country. Studies show that readmissions to the hospital are reduced as much as 20% when patients are seen by a doctor within the first week after a hospitalization. Often the blocker is not knowing a patient was discharged. CMS is putting some serious muscle behind getting information moving and is using their leverage as a payer to create new economic reasons to share. We love it.

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How are hospitals supposed to reduce readmissions? Part II

By KIP SULLIVAN, JD

The notion that hospitals can reduce readmissions, and that punishing them for “excess” readmissions will get them to do that, became conventional wisdom during the 2000s on the basis of very little evidence. The Medicare Payment Advisory Commission (MedPAC) urged Congress to enact the Hospital Readmissions Reduction Program (HRRP) beginning in 2007, and in 2010 Congress did so. State Medicaid programs and private insurers quickly adopted similar programs.

The rapid adoption of readmission-penalty programs without evidence confirming they can work has created widespread concern that these programs are inducing hospitals to increase utilization of emergency rooms and observation units to reduce readmissions within 30 days of discharge (the measure adopted by the Centers for Medicare and Medicaid Services [CMS] in its final rule on the HRRP), and this in turn may be harming sicker patients. Determining whether hospitals are gaming the HRRP and other readmission-penalty schemes by diverting patients to ERs and observation units (and perhaps by other means) should be a high priority for policy-makers. [1]

In Part I of this series I proposed to address the question of whether hospitals are gaming the HRRP by asking (a) does research exist describing methods by which hospitals can reduce readmissions under the HRRP and, in the event the answer is yes, (b) does that research demonstrate that those methods cost no more than hospitals save. If the answer to the first question is no, that would lend credence to the argument that the HRRP and other readmission-penalty schemes are contributing to rising rates of emergency visits and observation stays. If the answer to second question is also no, that would lend even more credence to the argument that hospitals are gaming the HRRP.

In Part I, I noted that proponents of readmission penalties, including MedPAC and the Yale New Haven Health Services Corporation (hereafter the “Yale group”), have claimed or implied that hospitals have no excuse for not reducing readmission rates because research has already revealed numerous methods of reducing readmissions without gaming. I also noted many experts disagree, and quoted a 2019 statement by the Agency for Healthcare Research and Quality that “there is no consensus” on what it is hospitals are supposed to do to reduce readmissions.

In this article, I review the research MedPAC cited in its June 2007 report to Congress, the report that the authors of the Affordable Care Act (ACA) cited in Section 3025 (the section that instructed CMS to establish the HRRP). In Part III of this series I will review the studies cited by the Yale group in their 2011 report to CMS recommending the algorithm by which CMS calculates “excess” readmissions under the HRRP. We will see that the research these two groups relied upon did not justify support for the HRRP, and did not describe interventions hospitals could use to reduce readmissions as the HRRP defines “readmission.” The few studies cited by these groups that did describe an intervention that could reduce readmissions:

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How Are Hospitals Supposed to Reduce Readmissions? | Part I

By KIP SULLIVAN

The notion that hospital readmission rates are a “quality” measure reached the status of conventional wisdom by the late 2000s. In their 2007 and 2008 reports to Congress, the Medicare Payment Advisory Commission (MedPAC) recommended that Congress authorize a program that would punish hospitals for “excess readmissions” of Medicare fee-for-service (FFS) enrollees. In 2010, Congress accepted MedPAC’s recommendation and, in Section 3025 of the Affordable Care Act (ACA) (p. 328), ordered the Centers for Medicare and Medicaid Services (CMS) to start the Hospital Readmissions Reduction Program (HRRP). Section 3025 instructed CMS to target heart failure (HF) and other diseases MedPAC listed in their 2007 report. [1] State Medicaid programs and the insurance industry followed suit.

Today, twelve years after MedPAC recommended the HRRP and seven years after CMS implemented it, it is still not clear how hospitals are supposed to reduce the readmissions targeted by the HRRP, which are all unplanned readmissions that follow discharges within 30 days of patients diagnosed with HF and five other conditions. It is not even clear that hospitals have reduced return visits to hospitals within 30 days of discharge. The ten highly respected organizations that participated in CMS’s first “accountable care organization” (ACO) demonstration, the Physician Group Practice (PGP) Demonstration (which ran from 2005 to 2010), were unable to reduce readmissions (see Table 9.3 p. 147 of the final evaluation) The research consistently shows, however, that at some point in the 2000s many hospitals began to cut 30-day readmissions of Medicare FFS patients. But research also suggests that this decline in readmissions was achieved in part by diverting patients to emergency rooms and observation units, and that the rising rate of ER visits and observation stays may be putting sicker patients at risk [2] Responses like this to incentives imposed by regulators, employers, etc. are often called “unintended consequences” and “gaming.”

To determine whether hospitals are gaming the HRRP, it would help to know, first of all, whether it’s possible for hospitals to reduce readmissions, as the HRRP defines them, without gaming. If there are few or no proven methods of reducing readmissions by improving quality of care (as opposed to gaming), it is reasonable to assume the HRRP has induced gaming. If, on the other hand, (a) proven interventions exist that reduce readmissions as the HRRP defines them, and (b) those interventions cost less than, or no more than, the savings hospitals would reap from the intervention (in the form of avoided penalties or shared savings), then we should expect much less gaming. (As long as risk-adjustment of readmission rates remains crude, we cannot expect gaming to disappear completely even if both conditions are met.)

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Why Should Anyone Care About Health Data Interoperability?

By SUSANNAH FOX

This piece is part of the series “The Health Data Goldilocks Dilemma: Sharing? Privacy? Both?” which explores whether it’s possible to advance interoperability while maintaining privacy. Check out other pieces in the series here.

A question I hear quite often, sometimes whispered, is: Why should anyone care about health data interoperability? It sounds pretty technical and boring.

If I’m talking with a “civilian” (in my world, someone not obsessed with health care and technology) I point out that interoperable health data can help people care for themselves and their families by streamlining simple things (like tracking medication lists and vaccination records) and more complicated things (like pulling all your records into one place when seeking a second opinion or coordinating care for a chronic condition). Open, interoperable data also helps people make better pocketbook decisions when they can comparison-shop for health plans, care centers, and drugs.

Sometimes business leaders push back on the health data rights movement, asking, sometimes aggressively: Who really wants their data? And what would they do with it if they got it? Nobody they know, including their current customers, is clamoring for interoperable health data.

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We Can Stop America’s Surge in Opioid-Dependent Babies

By STUART H. SMITH

Imagine a massive public health crisis in the United States that affects tens of thousands of people. Now imagine that the government had a simple tool at its disposal that could prevent this kind of physical and psychological trauma. You might think that I’m writing about America’s deadly outbreak of gun violence, which has made headlines this summer from Dayton to El Paso.

But actually I’m talking about a different crisis that affects even more people – all of them children — and which could be sharply reduced with one simple step that lacks the bitter political animus of the gun debate. The issue at hand involves babies born to mothers who used opioids during pregnancy – babies who tend to develop a condition called Neonatal Abstinence Syndrome, or NAS.

Experts say that state and federal governments have grossly underestimated the number of NAS babies currently born in the United States, as the addiction crisis triggered by Big Pharma’s greed in pushing painkillers refuses to fade. They say an accurate accounting would find a minimum of 250,000 children — and possibly two or three times that every year born with NAS. These kids will face chronic symptoms such as trembling and seizures, gastrointestinal problems, and an inability to sleep. Their numbers are more than eight times higher than the last official estimate from the government.

For more than a year now, I’ve been working with a team of attorneyscalled the Opioid Justice Team who are fighting for any settlement of the massive court fight pitting more than 2,000 localities against Big Pharma to include a medical monitoring fund for the estimated hundreds of thousands of kids born with NAS syndrome. But our team has also been pushing for radical measures that would prevent many of these unfortunate cases.

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I Have a Strong Relationship with my Bank but I Almost Never Go There. How Could this Translate to Primary Care?

By HANS DUVEFELT, MD

Imagine if your bank handled all your online transactions for free but charged you only when you visited your local branch – and then kept pestering you to come in, pay money and chat with them every three months or at least once a year if you wanted to keep your accounts active.

Of course that’s not how banks operate. There are small ongoing charges (or margins off the interest they pay you) for keeping your money and for making it possible to do almost everything from your iPhone these days. Yes, there may be additional charges for things that can’t be done without the bank’s personalized assistance, but those things happen at your request, not by the bank’s insistence.

Compare that with primary care. The bulk of our income is “patient revenue”, what patients and their insurance companies pay us for services we provide “face to face”. We may also have grants if we are Federally Qualified Health Centers, mostly meant to cover sliding fee discounts and what we call “enabling services” – care coordination, loosely speaking.

Only a small fraction of our income comes from meeting quality or compliance “targets”, and those monies only come to us after we have reached those goals – they don’t help us create the needed infrastructure to get there.

Then look at how medical providers are scheduled and paid. We all have productivity targets, RVUs (Relative Value Units – number and complexity of visits combined) if our employer is paid that way and usually just straight visit counts in FQHCs (because all visits are reimbursed at the same rate there). Sometimes we have quality bonuses or incentives, which truthfully may be the combined result of both our own AND other staff members’ efforts.

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The Opportunity in Disruption, Part 2: The Shape of Today’s System

By JOE FLOWER

The system is unstable. We are already seeing the precursor waves of massive and multiple disturbances to come. Disruption at key leverage points, new entrants, shifting public awareness and serious political competition cast omens and signs of a highly changed future.

So what’s the frequency? What are the smart bets for a strategic chief financial officer at a payer or provider facing such a bumpy ride? They are radically different from today’s dominant consensus strategies. In this five-part series, Joe Flower lays out the argument, the nature of the instability, and the best-bet strategies.

Healthcare CFOs must look at the environment in which their system lives: Since 2007 the actual costs for the average middle-class family for many of the basics of life have decreased in real terms, while their actual costs for healthcare have risen 25%, or even more counting co-pays, deductibles, and out-of-pocket expenses. This long, continuing rise in the costs along with the continuing and increasing unreliability of the healthcare system (“Will it actually be there for me when I need it? Will it bankrupt me?”) create unyielding disruption.

Instability: Omens

I am no fortune teller, but here are some things we can see right now that give us a sense of what’s coming.

  • Political shift: Public opinion has shifted. When polled about actual policies, healthcare has been cited repeatedly as the top concern of voters across the country. Voters’ top concerns are cost, the risk to patient protections in the ACA, and threats to “reform” Medicare by weakening it. The popularity of “single payer” proposals is a direct result of the cost and uncertainty of healthcare, a simple cry to “Do something!” Under this pressure we are more likely to see drastic solutions proposed and passed at the federal and state level or embodied in regulatory changes and lawsuits against industry practices.
  • Degradation of American life: With the opioid epidemic, the rise in suicides, the actual regression in life expectancy, and the increasing income and wealth divide, people increasingly feel that the healthcare industry is just not helping. They feel it is in fact part of the problem. The feeling that there is no one there to help us adds to the desperation of many parts of American society and heightens the political cost of the healthcare issue.
  • Public awareness: Healthcare is intensely personal, visceral. It’s crazy-making. Surprise bills, balance bills, other bills slipped through loopholes in the fine print or even in unwritten industry practices—what the industry considers standard operating procedure, the customers view as shocking, aggressive, and financially crushing.
  • The rebellion of the buyers: The percentage of buyers—such as employers, unions, and pension plans—telling various polls that healthcare costs represent a major problem for their business has more than doubled in the last five years and is now a majority. Buyers are pushing for choices to control costs and manage quality. They are beginning in greater numbers to demand reference pricing tied to Medicare rates, direct access to competitive bundled prices, and price transparency through centers of excellence, high performance networks and accountable care organizations. Some 65% of employers plan on implementing direct primary care in onsite or near-site clinics by 2020. Buyers are increasingly willing to take their beneficiaries elsewhere if your business can’t meet their demands.
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The Opportunity in Disruption, Part 1

By JOE FLOWER

The system is unstable. We are already seeing the precursor waves of massive and multiple disturbances to come. Disruption at key leverage points, new entrants, shifting public awareness and serious political competition cast omens and signs of a highly changed future.

So what’s the frequency? What are the smart bets for a strategic chief financial officer at a payer or provider facing such a bumpy ride? They are radically different from today’s dominant consensus strategies. In this five-part series, Joe Flower lays out the argument, the nature of the instability, and the best-bet strategies.

“It’s a buckdancer’s choice, my friend. Better take my advice. You know all the rules by now, and the fire from the ice.”

— Robert Hunter, “Uncle John’s Band”              

Chief Financial Officer: tough gig. Seriously. Whether for a payer or a healthcare provider, the CFO’s job is the exact point where the smiling faces on the billboards meet the double entry, the financing, the payer mix, the debt structure. And it all has to work out in the black. It has to do that sustainably, not only this year but next year and five years from now. Best guess? It’s going to get a lot tougher, with shifting revenue streams, market boundaries, new technologies, growing consumer expectations and uncertain politics. 

Raise your hand if you can tell me the significance of these names: Univac, Control Data, Burroughs, Digital, Honeywell, IBM, NCR.

These companies dominated the computer world in 1980. As of 1990, all but IBM were gone, bankrupt, subsumed into some other company, or just out of the computer business. The one that survived, IBM, is the one that said, “Maybe we should at least get a toehold in this new personal computer game, even though it is risky for our main revenue streams.” All the others went “poof.”

A number of factors—radical new technologies with vast potential, ramifying customer frustration, shifting user base—are coming together to put healthcare today at exactly the place the computing world was in 1980.

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Can Rah-Rah, Blah-Blah and Meh Accelerate Digital Health Innovation?

By MICHAEL MILLENSON

Can combining health tech “rah-rah,” health policy “blah-blah” and the “meh” of academic research accelerate the uptake of digital health innovation?

AcademyHealth, the health services research policy group, is co-locating its Health Datapalooza meeting, rooted in cheerleading for “Data Liberación,” with the National Health Policy Conference, rooted in endless debate about policy detail.

Sharing a hotel room, however, does not a marriage make. In order to get better digital health interventions to market faster, we need what I’m calling a Partnership for Innovators, Policymakers and Evidence-generators (PIPE). As someone who functions variously in the policy, tech and academic worlds, I believe PIPE needn’t be a dream.

The potential of digital health is obvious. Venture funding of digital health companies soared to $8.1 billion in 2018, up 40 percent from 2017, according to Rock Health, with another $4.2 billion invested during the first half of this year. Meanwhile, MedCityNews proclaimed 2019 “the year of the digital health IPO,” such as HealthCatalyst and Livongo.

Separately, Congress has sought to speed digital health innovation through bipartisan efforts such as the 21stCentury Cures Act and the formation last year of the Bipartisan Health Care Innovation Caucus. The Department of Health and Human Services (HHS) is also pursuing innovator and advocacy group input on regulatory relief.

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