Historically, the Centers for Medicare & Medicaid Services’ (CMS) stance on the influence that social determinants of health (SDOH) have on health outcomes has been equal parts signal and noise. In April 2016, the agency announced it would begin adjusting the Medicare Advantage star ratings for dual-eligibility and other social factors. This was amid calls for increased equity in the performance determinations from the managed care industry. At the same time, CMS continued to refuse risk-adjustment for SDOH in the Hospital Readmissions Reduction Program (HRRP) despite the research supporting the influence of these factors on the HRRP.
It wasn’t until Congress interceded with the 21st Century Cures Act that CMS conceded to adjusting for dual-eligibility under the new stratified approach to determining HRRP penalties beginning in fiscal year 2019. The new methodology compares hospital readmission performance to peers within the same quintile of dual-eligible payer mix. The debate surrounding the adjustment of incentive-based performance metrics for SDOH likely is to continue, as many feel stratification is a step in the right direction, albeit a small one. And importantly, the Cures Act includes the option of direct risk-adjustment for SDOH, as deemed necessary by the Secretary of Health and Humans Services.
SDOH are defined as “the conditions in which people are born, grow, live, work and age.” The multidimensional nature of SDOH reach far beyond poverty, requiring a systemic approach to effectively moderate their effects on health outcomes. The criteria used to identify SDOH include factors that have a defined association with health, exist before the delivery of care, are not determined by the quality of care received and are not readily modifiable by health care providers.
The question of modifiability is central to the debate. In the absence of reimbursement for treating SDOH, providers lack the resources to modify health outcomes attributable to social complexities. Therefore, statistical adjustments are needed to account for differences in these complexities to ensure risk-adjusted performance comparisons of hospitals are accurate.
Leaders in hospitals and health systems as well as post-acute care providers such as skilled nursing facilities (SNFs) and Home Health Care (HHC) agencies operate in a complex environment. Currently, the health care reimbursement environment is largely dominated by fee-for-service models. However, acute and post-acute leaders must increasingly position their organizations to prepare for, and participate in, evolving value-based care programs—without losing sight of the current fee-for-service reimbursement structure.
With that said, the call to action for acute and post-acute providers working at both ends of the reimbursement spectrum is real. The time is now to innovate, test and adopt new post-acute care models to support each patient’s transition from hospital to post-acute settings, and eventually home to enable a better care experience for patients and their care teams.
This is especially relevant for Skilled Nursing Facilities (SNFs) and chains that meet the current Medicare requirements for Part A coverage. Increasingly, the SNF industry is under pressure from the Medicare program to improve coordination and outcomes. Medicare’s hospital readmission policy and value-based purchasing program (VBP), bundled payments, and ACOs encourage SNFs, and other post-acute settings, to avoid readmissions. In addition, earlier this year, the Centers for Medicare and Medicaid Services (CMS) finalized a new patient-driven payment model (PDPM) for SNFs, which will go into effect on October 1, 2019. The overhaul of the entire system will require significant staff focus and operational changes.
Often, a Congressional gridlock is essentially good. This is because the executive arm of government is forced to consider a bipartisan approach to issues if it’s to secure the approval of both Democrats and Republicans in Congress.
The outcome of the midterm elections indicates that the Republicans have managed to retain their control of the Senate, while Democrats have secured control of the House of Representatives.
Health a Central Issue During the Midterms
According to a survey by Health Research Incorporated, the three top issues of concern during the midterm elections were health, followed by Social Security and Medicare, with 59% of the respondents irrespective of age, race or geography citing health as the most significant.
Among Trump’s electoral promises was a complete repeal and replacement of Obamacare under the Affordable Care Act (ACA) with a policy that was apparently less expensive and more effective. On his first day of office, Trump signed an executive order instructing federal agencies “to take all reasonable measures that minimize the economic burden of the law, including actions to waive, defer, grant exemptions from, or delay the implementation of any provision or requirement of the Act.”
Much of the media coverage following the high-profile suicides of Kate Spade and Anthony Bourdain has followed recommended best practices to reduce risk of suicide contagion or “copycat” suicides by including warning signs a person may be at risk of suicide due to depression and contact information for the national hotline for suicide prevention. This overly simplistic approach implies that we can prevent all suicides by reaching out to loved ones in emotional distress and advertising the existence of mental health treatment.
As a psychiatrist who treats individuals hospitalized for acute suicide risk, I am concerned that much of the media coverage has belied the complexity of suicide. While we do not yet fully understand why suicide rates are rising, we do know that suicide is a complex public health problem that will require a multifaceted approach to reduce deaths. Increased awareness of depression as a treatable medical illness is an important but insufficient response to the suicide epidemic.
The 2019 ACA plan year is notable for the increase in insurer participation in the marketplace. Expansion and entry have been substantial, and the percent of counties with one insurer has declined from more than 50 percent to approximately 35 percent. While urban areas in rural states have received much of the new participation, entire rural states have gained, along with more metropolitan urban areas.
Economic theory and common sense lead most to believe that increased competition is unquestionably good for consumers. Yet in the paradoxical world of the subsidized ACA marketplace, things are not so simple. In some markets, increased competition may result in a reduction in the purchasing power of subsidized consumers by narrowing the gap between the benchmark premium and plans that are cheaper than the benchmark. Even though the overall level of premiums may decline, potential losses to subsidized consumers in some markets will outweigh gains to the unsubsidized, suggesting that at the county level, the losers stand to lose more than the winners will win.
One way to illustrate this is to hypothetically subject 2018 marketplace enrollees to 2019 premiums in counties where new carriers have entered the market. Assuming that enrollees stay in the same metal plan in both 2018 and 2019, and that they continue to buy the cheapest plan in their metal, we can calculate how much their spending would change by income group.
Under these assumptions, in about one quarter of the counties with federally facilitated marketplaces (FFM) that received a new carrier in 2019, both subsidized and unsubsidized enrollees would be better off in 2019, meaning that they could spend less money and stay in the same metal level. In about thirty percent of these counties, all enrollees are worse off. In almost all of the rest, about forty percent, there are winners and losers, but in the aggregate, the subsidized lose more than the unsubsidized win. Overall, in about 70 percent of FFM counties with a new carrier, subsidized enrollees will lose purchasing power, while in about 66 percent of these counties, unsubsidized customers will see premium reductions. In population terms, about two-thirds of subsidized enrollees in counties with a new carrier will find plans to be less affordable, while a little more than half of unsubsidized enrollees will see lower premiums.
Among all the talk of waves and tides of the close midterm races around the country, there were tremendous results on election day for Medicaid expansion. Three states – Idaho, Nebraska, and Utah – passed ballot initiatives approving the policy.
On top of that, in Kansas and Maine, governors who had vetoed the policy in the past were replaced with candidates promising to enact it.
This was obviously great news for supporters of Medicaid expansion with the total number of expansion states firmly at 36.
What were the issues?
In Idaho, the Expansion ballot initiative was designed to provide insurance covers for individuals under the age of sixty-five and whose income is below 138 percent of the federal poverty level and who are not eligible for any other state insurance cover.
Among the proponents of Medicaid in Idaho was State representative Christy Perry a Republican and staunch Trump supporter. She had over the years attempted to push for the expansion through the state legislature but faced resistance from statehouse leaders.
The scenario in Idaho applies to Utah and Nebraska, with the ballot initiative being necessitated by the strong opposition from the majority of Republicans and statehouse leaders. In Utah, opponents of the Expansion argued that the initiative would bankrupt the state treasury. In Nebraska caution was given against reliance on federal government financing for state programs noting that often the national government scale back or neglect supporting state programs without proper transitional mechanisms.
However, it was difficult to debate against the fact that Medicaid would free up resources invested by the state governments in local insurance programs and that the federal government is legally obliged to pay 90% of the cost of the policy.
The Hospital Readmissions Reduction Program (HRRP), one of numerous pay-for-performance (P4P) schemes authorized by the Affordable Care Act, was sprung on the Medicare fee-for-service population on October 1, 2012 without being pre-tested and with no other evidence indicating what it is hospitals are supposed to do to reduce readmissions. Research on the impact of the HRRP conducted since 2012 is limited even at this late date , but the research suggests the HRRP has harmed patients, especially those with congestive heart failure (CHF) (CHF, heart attack, and pneumonia were the first three conditions covered by the HRRP). The Medicare Payment Advisory Commission (MedPAC) disagrees. MedPAC would have us believe the HRRP has done what MedPAC hoped it would do when they recommended it in their June 2007 report to Congress (see discussion of that report in Part I of this two-part series). In Chapter 1 of their June 2018 report to Congress, MedPAC claimed the HRRP has reduced 30-day readmissions of targeted patients without raising the mortality rate.
MedPAC is almost certainly wrong about that. What is indisputable is that MedPAC’s defense of the HRRP in that report was inexcusably sloppy and, therefore, not credible. To illustrate what is wrong with the MedPAC study, I will compare it with an excellent study published by Ankur Gupta et al. in JAMA Cardiology in November 2017. Like MedPAC, Gupta et al. reported that 30-day CHF readmission rates dropped after the HRRP went into effect. Unlike MedPAC, Gupta et al. reported an increase in mortality rates among CHF patients. 
We will see that the study by Gupta et al. is more credible than MedPAC’s for several reasons, the most important of which are: (1) Gupta et al. separated in-patient from post-discharge mortality, while MedPAC collapsed those two measures into one, thus disguising any increase in mortality during the 30 days after discharge; (2) Gupta et al.’s method of controlling for differences in patient health was superior to MedPAC’s because they used medical records data plus claims data, while MedPAC used only claims data.
I will discuss as well research demonstrating that readmission rates have not fallen when the increase in observation stays and readmissions following observations stays are taken into account, and that some hospitals are more willing to substitute observation stays for admissions than others and thereby escape the HRRP penalties.
All this research taken together indicates the HRRP has given CHF patients the worst of all worlds: No reduction in readmissions but an increase in mortality, and possibly higher out-of-pocket costs for those who should have been admitted but were assigned to observation status instead.
Egged on by the Medicare Payment Advisory Commission (MedPAC), Congress has imposed multiple pay-for-performance (P4P) schemes on the fee-for-service Medicare program. MedPAC recommended most of these schemes between 2003 and 2008, and Congress subsequently imposed them on Medicare, primarily via the Affordable Care Act (ACA) of 2010 and the Medicare Access and CHIP Reauthorization Act (MACRA) of 2015.
MedPAC’s five-year P4P binge began with the endorsement of the general concept of P4P at all levels – hospital, clinic, and individual physician – in a series of reports to Congress in 2003, 2004, and 2005. This was followed by endorsements of vaguely described iterations of P4P, notably the “accountable care organization” in 2006 , punishment of hospitals for “excess” readmissions in 2007 , the “medical home” in 2008 and the “bundled payment” in 2008. None of these proposals were backed up by anything resembling evidence.
Congress endorsed all these schemes without asking for evidence or further details. Congress dealt with the vagueness of, and lack of evidence supporting, MedPAC’s proposals simply by ordering CMS to figure out how to make them work. CMS staff added a few more details to these proposals in the regulations they drafted, but the details were petty and arbitrarily adopted (how many primary doctors had to be in an ACO, how many patients had to sit on the advisory committee of a “patient-centered medical home,” how many days had to expire between a discharge and an admission to constitute a “readmission,” etc.).
New rule, new culture
This process – invention of nebulous P4P schemes by MedPAC, unquestioning endorsement by Congress, and clumsy implementation by CMS – is not working. Every one of the proposals listed above has failed to cut costs (with the possible exception of bundled payments for hip and knee replacements) and may be doing more harm than good to patients. These proposals are failing for an obvious reason – MedPAC and Congress subscribe to the belief that health policies do not need to be tested for effectiveness and safety before they are implemented. In their view, mere opinion suffices.
This has to stop. In this two-part essay I argue for a new rule: MedPAC shall not propose, and Congress shall not authorize, any program that has not been shown by rigorously conducted experiments to be effective at lowering cost without harming patients, improving quality, or both. This will require a culture change at MedPAC. Since its formation in 1997, MedPAC has taken the attitude that it does not have to provide any evidence for its proposals, and it does not have think through its proposals in enough detail to be tested. Over the last two decades MedPAC has demonstrated repeatedly that it believes merely opining about a poorly described solution is sufficient to discharge its obligation to Congress, taxpayers, and Medicare enrollees. Continue reading…
According to the Democrats, their success across the country in the midterm elections has largely been due to the party running on healthcare. Indeed, surveys such as the one conducted by Health Research Incorporated indicated that health was the number one concern for voters during the midterms. In the three states where Medicaid expansion was on the ballot, voters were in favor of it. We’ve been wondering about that, so we took a look at how Iowa voted.
It’s one thing for voters to support healthcare on its own. It’s another for an issue to outweigh all others. Did healthcare really beat every other concern a voter thinks about when picking a candidate during the midterms?
Congressional and Statewide Races
Democrats took 3 of the Iowa’s 4 seats, unseating 2 Republican incumbents. They had a sizeable majority of the votes cast, so things looked good for the Democrats. If the theory holds up, the focus the Democrats kept on healthcare throughout the race would pay off. And it would seem it worked, right?
There’s a big problem here. If Democrats had made gains in Iowa because of healthcare issues, we should expect them to have a pretty resounding victory in the gubernatorial race and in the statehouse.
Former President George H.W. Bush may have been every inch the caring individual portrayed in the eulogies of those who knew him, but when it came to health care reform, two words characterized his attitude: Don’t care.
However, compared to Congressional Republicans, Bush was a profile in conservative courage – a lesson with unfortunate parallels to now.
I covered health policy as a reporter for the Chicago Tribune during the Bush years. One strong memory, confirmed by checking original sources, was the presidential debate on Sept. 25, 1988 between Bush and his Democratic challenger, Massachusetts Gov. Michael Dukakis. When Bush was asked what he’d do for the 37 million people without health insurance – about one in seven Americans – he answered that he would “permit people to buy into Medicaid.”
I remember turning from the TV to my wife and saying, “I have no idea what he’s talking about.” Neither, apparently, did anyone else. A Washington Post story that followed, headlined, “Bush’s Mysterious Medicaid Plan” noted that seeking details from the Bush campaign yielded “answers [that] are contradictory.” The story added that “Bush had never publicly mentioned the idea” until the debate.