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Category: Health Policy

Slow Walking to Value Based Care: Why Fee for Service Still Rules

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By KEN TERRY

(This is the second in a series of excerpts from Terry’s new book, Physician-Led Healthcare Reform: a New Approach to Medicare for All, published by the American Association for Physician Leadership.)

In January 2015, then Health and Human Services Secretary Sylvia Burwell announced lofty goals for the government’s value-based payment program. By the end of 2016, she said, 85% of all payments in the traditional Medicare program would be tied to quality or value, and 90% would be value-based by the end of 2018.

The government planned to tie 30% of Medicare payments to alternative payment models by 2017, according to Burwell, and hoped to reach the 50% mark by 2018. In March 2016, HHS said it had reached the 30% goal a year ahead of schedule, mainly because of the Medicare Shared Savings Program (MSSP).

More recent data on the value-based-care movement comes from the Health Care Payment & Learning Action Network (LAN), a public-private partnership launched in 2015 by the Department of Health and Human Services. The LAN reported in October 2018 that public and private payers covering 226 million lives, or 77% of insured Americans, had tied 34% of their payments to value-based care. According to the organization, only 23% of total payments had been value-based in 2016.A deeper analysis of the LAN data, however, shows that the vast majority of value-based payments—both in Medicare and in the larger healthcare system—were still limited to pay for performance, upside-only shared savings, and care management fees paid to patient-centered medical homes.

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Physicians Should Lead on Healthcare Reform

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By KEN TERRY

(This is the first in a series of excerpts from Terry’s new book, Physician-Led Healthcare Reform: a New Approach to Medicare for All, published by the American Association for Physician Leadership.)

Even before COVID-19, healthcare reform seemed to be stuck between a rock and a hard place, but there is a rational way forward. This approach, which I call “physician-led healthcare reform,” would engage doctors in building a healthcare system that was safe, effective, patient-centered, timely, efficient, and equitable, to use the Institute of Medicine’s set of foundational goals in its landmark book, Crossing the Quality Chasm: a New Health System for the 21st Century.Primary care physicians, rather than hospitals, would be in charge of the system, and they’d work closely with specialists and other healthcare professionals to produce the best patient outcomes at the lowest cost.

It would take a decade or more to restructure the healthcare system so that this goal could be achieved. Similarly, the transition to a single-payer insurance system needs to be accomplished gradually—although the pandemic might accelerate that timetable. Most people are not yet ready to abandon employer-sponsored insurance, and there’s still a lot of distrust of the government. Providers are more likely to accept changes in how they’re paid over time than all of a sudden. Additional benefits can also be brought online slowly. Ideally, we could transform healthcare financing over a 10-year period while rebuilding the care delivery system at the same time.

That is why implementing Medicare for America—a reform plan devised by the Center for American Progress and embodied in a current House bill–makes more sense than going directly to Medicare for All: it changes the system incrementally while achieving universal coverage fairly quickly. Medicare for America would do this by enrolling the uninsured, people who purchase individual insurance, and those now in Medicare, Medicaid, and the Children’s Health Insurance Program (CHIP). People would also be enrolled automatically at birth. Companies could enroll their employees in Medicare for America, and employees could opt out of employer-sponsored plans and enroll in the public plan.

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Health Insurers Ride High for Now, But Watch What’s Coming Next

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By KEN TERRY

In the strangest healthcare business story of 2020, the major health insurance companies are thriving despite—or because of—the pandemic. As the second quarter reports of United, Anthem, Cigna and other insurers reveal, their COVID-19-related costs were outweighed by the sharp drop in claims for other healthcare services.

As a result, the second quarter operating gain for Anthem, one of the largest national carriers, jumped 65% from the prior-year period, while the portion of its premiums spent on member benefits dropped to 78%. The earnings of UnitedHealth, similarly, vaulted 98% as the percentage of its premiums spent on health care fell to 70.3%. Such a low “medical loss ratio” has probably not been seen since the 1990s.

At the same time, the big insurers’ membership has been rising, but not among workers covered by employer-sponsored plans. Commercial insurance members served by United, for example, fell by 270,000 to 26.8 million, following a drop of 720,000 in Q1. In contrast, the number of people in United’s Medicaid managed care plans rose by 330,000.

These trends track with the short-time fallout of the pandemic. Families USA reported that 5.4 million workers who lost their jobs from February to May also lost their health insurance. Another study predicted that by the end of 2020, 10.1 million people will lose employer-based insurance tied to someone in their household.

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Healthcare Sings The Non-Profit Blues

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By MICHAEL TURPIN

Powers once assumed are never relinquished, just as bureaucracies, once created, never die.

Charley Reese

As we ponder the 100 day count down to the Presidential Elections, the rhetoric and ranting swirling around the best solution for our nation’s healthcare crisis, is hitting decibel levels not heard since the passage of the Affordable Care Act.  As with any major entitlement legislation, there are commendable elements, inefficiencies, and a host of unintended consequences. The current administration’s obsession with repeal while the ranks of uninsured people grow, begs the question, “what is the blue-print for expanding coverage and reducing waste, fraud and abuse while increasing transparency, quality and overall public health.  Answer: There is no plan and if there was, it would fall well short of achieving many of these objectives given the deeply entrenched stakeholder who actually do not benefit if the cost of healthcare declines.  It a classic NIMBY response: “I’m all for reform as long as I maintain my role and revenue in whatever solution is proposed.”. 

The Affordable Care Act is a solid foundation to build a 2.0 version of a solution to solve for the uninsured and to act as a catalyst for market reforms that will either reshape the misaligned incentives and embedded inequities in our current system or it will lead to voters demanding the expansion the role of Medicare and Medicaid.  70M adults and children are covered under Medicaid – including those who benefited by the passage of the ACA.  Approximately 55M are covered under Medicare resulting in 125M covered under some form of state or federal aid. 155M receive coverage through employers. 

Its estimated by the Economic Policy Institute that 29.8M individuals who received coverage as a result of ACA expansion would lose coverage if no legislation replaced it.  Add in the severe economic dislocation arising from Covid-19 that could result in an additional 14M unemployed and you could see a worst case of uninsured swell from a current 27M to as high as 70M according to Policy Advice, a non-profit industry watch dog.

So how can you change the current market to drive reforms without a legislated intervention?  It starts by enforcing laws already in place and challenging regulators to do their jobs – ensuring that we minimize waste, fraud and abuse.  As of 2020, the average annual cost of family health coverage has eclipsed the cost of a mid-sized economy car. We must tackle the affordability problem by reducing the number of intermediaries who extract profits from the delivery system but do not play properly in the sand box of regulation that is often poorly monitored. We must demand transparency and deconstruct expensive bureaucracies only inflate the cost of care without improving it. It’s impossible to moderate the cost of healthcare without reducing the size of the pie and those feeding on it.

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Health Insurance Needs to Grow Up

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By KIM BELLARD

I’ve been covered by private insurance my entire life.  Even more telling, I worked in the health insurance industry for — gasp! — some thirty years.  It’s not just paid for my healthcare, it’s financed my life.

Today, though, for the first time in my life, I’m covered by public insurance — and I couldn’t be more relieved.  

Now, I’m not going to go all Wendell Potter.  I know many people have their health insurance horror stories, but, sadly, people have them about pretty much every part of the healthcare industry.  I believe most people working in health insurance, like most people working in healthcare generally, sympathize with the people they serve and are just trying to do a good job.  

The problem is that the health insurance model has outgrown the times.  I’ll try to explain some ways how.

Premiums

Once upon a time, most people had employer coverage, and those employers paid all or most of its cost.  Those days are gone.  Employer coverage is still the predominant form of private health insurance, and employers still pay the majority of its cost, but percentage of people with employer coverage continues to drop and the amount they pay for it continues to increase.  

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Healthcare Should Get Into Some #GoodTrouble

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By KIM BELLARD

As hopefully most of you know, Rep. John Lewis, civil right icon and longtime member of Congress, died this past Friday.  Rep. Lewis was often described the “conscience of Congress”  – perhaps a low bar in today’s Congress but important nonetheless — for his unwavering commitment to social justice.  I have always been struck in particular by one of his quotes:

Rep. Lewis must have been heartened by the fact that, in 2020, plenty of people are, indeed, making noise and getting into good trouble, necessary trouble over issues that he cared deeply about, like Black Lives Matter and voting rights.  There are others who are better able to write about those people and that trouble.  So I’d like to talk about his call to action with respect to healthcare.

If you are working today in healthcare — especially in the United States — or, for that matter, someone getting healthcare or having a loved one get it, then you should be making some noise and getting into good trouble, because our healthcare system most definitely makes it necessary. 

It should come as no surprise that we’re not very happy with our healthcare system, rating it lower than do citizens in most other developed countries.  And for good reason: it’s the world’s most expensive while delivering sub-par health results and leaving tens of millions without financial protection.  Even our physicians don’t like it.  Even our latest, best effort for improving the sorry state of our healthcare system — the Affordable Care Act  – is under risk of repeal due to a lawsuit brought by 18 states and backed by the Trump Administration.  

Every day, too many of us suffer in the healthcare system, ranging from waits to indignities to critical mistakes, and some face financial ruin due to the care — whether good or bad.  Most of us suffer in silence, or only complain to our friends and family.  We don’t see a lot of mass protests about the pitiful state of our healthcare system, and I have to wonder why.  

We have to stop being so passive.

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TikTok Teen’s Time

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By KIM BELLARD

I knew about TikTok, but not “TikTok Teens.”  I was vaguely aware of K-Pop, but I didn’t know its fans had common interests beyond, you know, K-Pop.  I’d been tracking Gen X and Millennials but hadn’t really focused on Gen Z.  It turns out that these overlapping groups are quite socially aware and are starting to make their influence felt.  

I can’t wait for them to pay more attention to health care.  

This is the generation that has grown up during/in the wake of 9/11, the War on Terror, the War on Drugs, the 2008 recession, the coronavirus pandemic, and the current recession — not to mention smartphones, social media, online shopping, and streaming.  Greta Thunberg is Gen Z, as is Billie Eilish, each of whom is leading their own social movements.  This generation has a lot to protest about, and a lot of ways to do it.

They were in the news this past weekend due to, of all things, President Trump’s Tulsa rally.  His campaign had boasted about having a million people sign up for the rally, only to find that the arena was less than a third filled.  An outdoor rally for the expected overflow crowd was cancelled.  

It didn’t take long for the TikTok Teens/K-Pop fans to boast on social media about their covert — to us older folks — campaign to register for the rally as a way to gum up the campaign efforts.  Steve Schmidt, an anti-Trump Republican strategist, tweeted: “The teens of America have struck a savage blow against @realDonaldTrump.”

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A Missed Opportunity for Universal Healthcare

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Connie Chan
Phuoc Le

By PHUOC LE, MD and CONNIE CHAN

The United States is known for healthcare spending accounting for a large portion of its Gross Domestic Product (GDP) without yielding the corresponding health returns. According to the Center for Medicare and Medicaid Services (CMS), healthcare spending made up 17.7% ($3.6 trillion) of the GDP in the U.S. in 2018 – yet, poor health outcomes, including overall mortality, remain higher compared to other Organization for Economic Cooperation and Development (OECD) countries. According to The Lancet, enacting a single-payer UHC system would likely result in $450 billion in savings in national healthcare and save more than 68,000 lives.

Figure 1. Mortality rate in the US versus other OECD countries.

The expansion of Medicaid under the Patient Protection and Affordable Care Act (ACA or Obamacare) was not the first attempt the United States government made to increase the number of people with health insurance. In 1945, the Truman administration introduced a Universal Health Care (UHC) plan. Many Americans with insurance insecurity, most notably Black Americans and poor white Americans, would benefit from this healthcare plan. During this time, health insurance was only guaranteed for those with certain jobs, many of which Blacks and poor white Americans were unable to secure at the time, which resulted in them having to pay out-of-pocket for any wanted healthcare services. This reality pushed Truman to propose UHC within the United States because it would allow “all people and communities [to] use the promotive, preventative, curative, rehabilitative and palliative health services they need of sufficient quality…, while also ensuring that the use of these services does not expose the user to financial hardship.”

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Paul O’Neill, Health Care Hero

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By MICHAEL MILLENSON

Paul O’Neill, who died from lung cancer earlier this month at age 84, was one of my personal heroes, but not because of anything he accomplished as Alcoa’s chief executive officer or as Secretary of the Treasury.

O’Neill was my hero because he saved patients’ lives. 

Two decades ago, when few dared speak openly about medical error, this titan of industry put his considerable clout behind a radical idea: not a single patient should be injured or killed by their medical care. And in pursuit of that goal, hospitals had to continually make care measurably safer.

No one of O’Neill’s stature, before or since, has shown anything close to his dogged determination to make this ideal real.

O’Neill first embraced zero harm after Karen Wolk Feinstein, the president of a small, local foundation, had the chutzpah to ask him to serve as co-chairman of a coalition to radically improve Pittsburgh’s health care. He make this commitment even though it was a goal championed by a non-physician book author (me) and by a PhD in labor economics (Feinstein), while being denounced as naively unrealistic by respected local medical leaders.

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Still Fighting the Wrong Wars

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By KIM BELLARD

What do the coronavirus and Navy ships have in common?  For that matter, what do our military spending and our healthcare spending have in common?  More than you might think, and it boils down to this: we spend too much for too little, in large part because we tend to always be fighting the wrong wars.  

Photo by STR/AFT via Getty Images

I started thinking about this a couple weeks ago due to a WSJ article about the U.S. Navy’s “aging and fragmented technology.”  An internal Navy strategy memo warned that the Navy is “under cyber siege” by foreign adversaries, leaking information “like a sieve.”  It grimly pointed out:

Our adversaries gain an advantage in cyberspace through guerrilla tactics within our defensive perimeters.  Once inside, malign actors steal, destroy and/or modify critical data and information. 

This is the Navy, after all, that proudly tried to modernize by installing touch screen technology on some of its ships, only to have the disaster that hit the USS McClain.  Its vaunted Integrated Bridge and Navigation System was, ProPublica found, “was a welter of buttons, gauges and software that, poorly understood and not surprisingly misused, helped guide 10 sailors to their deaths.”  And that wasn’t the only technology-enabled naval disaster in recent years.

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