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Category: The Business of Health Care

From ZPICS to RADVS: The Alphabet Soup of Patient Charts and Payment Tracking

We’ve written about the Recovery Audit Contracts (RAC) program previously and thought it would be worthwhile to check back in on recent news in this space.  According to CMS, in FY 2012, RAC auditors collected $2.29B in 2012, nearly three times the amount recouped in 2011.

What’s apparent from this data is that a large step up in audit activity is obviously occurring, which will only accelerate in 2013 as auditors begin looking at evaluation and management (E&M) CPT codes commonly used by family physicians outside of the hospital setting.  In fact, when we match this CMS data against the latest results from the American Hospital Association’s RACTrac survey of 2,260 hospitals, it’s even more obvious that the level of activity around responding to requests for patient charts and managing the audit process is growing at an extremely rapid pace.

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Is Fee-for-Service Really Dead? Really?

The 21st century challenge for the American health care delivery system is to deliver higher quality care for less money.   Republican and Democratic experts agree that payment reform involving transitioning from fee-for-service to global, value-based systems is necessary for us to achieve that goal.  Accountable care organizations (ACOs) are the new entities that will receive the new global payments and distribute them to the doctors, allied health professionals, hospitals, and post-acute care facilities that care for the patients; Medicare ACOs are being piloted under provisions in the Affordable Care Act (ACA) and Commercial ACOs are being developed by private insurance companies, hospitals, and physician groups.

The ideal payment system would support the ideal value-driven health care delivery system.  Distinguished expert panels convened by the Commonwealth Fund and the Institute of Medicine have described the attributes of a system that would be far superior to our current delivery system:

· Care would be patient-centered
· Care would be safe
· Care would be timely and accessible
· Care would be efficient with little waste
· Care would be coordinated among providers and across facilities
· Continuity of care and care relationships would be facilitated
· Collaboration among providers would deliver high quality, low cost care
· Patients’ clinical information would be efficiently exchanged
· Caregivers would engage patients in ways that would maximize health
· Accountability for each aspect and for total care would be clear
· Continuous innovation, learning, and improvement would occur

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Doctor, I’m Not Comfortable with That Order

A little more than 13 years ago, the Institute of Medicine (IOM) released its seminal report on patient safety, To Err is Human.

You can say that again. We humans sure do err.  It seems to be in our very nature.  We err individually and in groups — with or without technology.  We also do some incredible things together.  Like flying jets across continents and building vast networks of communication and learning — and like devising and delivering nothing- short-of-miraculous health care that can embrace the ill and fragile among us, cure them, and send them back to their loved ones.  Those same amazing, complex accomplishments, though, are at their core, human endeavors.  As such, they are inherently vulnerable to our errors and mistakes.  As we know, in high-stakes fields, like aviation and health care, those mistakes can compound into catastrophically horrible results.

The IOM report highlighted how the human error known in health care adds up to some mindboggling numbers of injured and dead patients—obviously a monstrous result that nobody intends.

The IOM safety report also didn’t just sound the alarm; it recommended a number of sensible things the nation should do to help manage human error. It included things like urging leaders to foster a national focus on patient safety, develop a public mandatory reporting system for medical errors, encourage complementary voluntary reporting systems, raise performance expectations and standards, and, importantly, promote a culture of safety in the health care workforce.

How are we doing with those sensible recommendations? Apparently to delay is human too.

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Healthcare: The Journal of Delivery Science and Innovation

Healthcare: The Journal of Delivery Science and Innovation, a new journal promoting cutting edge research on innovation in health care delivery, has launched. The questions is, do we really need yet another journal? The short answer is yes. The longer answer is, absolutely yes. Here’s why.

The Need for New Knowledge on Healthcare Delivery

There is an urgent need to improve our mess of a health care system. Healthcare will consume about $2.8 trillion in 2012 – that’s an astronomical amount of money.  To think of it in another way:  spending in Intensive Care Units will make up 1% of all economic activity in the U.S.  In a broader context, about 1 in 5 dollars in the economy will be spent on healthcare.

How will we actually spend the $2.8 trillion? Over a million doctors and nurses will see patients in hundreds of thousands of clinics, hospitals, nursing homes, and countless other settings.  They will see patients who are sick and suffering and will make decisions about how to help them get better.  These intensely personal decisions will be made in the context of a broader healthcare delivery system that is mindboggling diverse, complex, and fundamentally broken.  We are probably wasting more on healthcare than we are spending on education.  Yet, despite all this money and excess (or may be because of it), tens of thousands of Americans are dying each year because of poor quality, unsafe care.  We can do so much better.

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Nine States to Watch for ACA Implementation

Healthcare reporters have been in a frenzy to report this week that the ACA is a done deal and states should get on with it. The election certainly changes the dynamic in the repeal effort, as Speaker John Boehner indicated in a recent interview with ABC News, yet the implementation battle is far from over.

The next interesting story line is developing out of an OK lawsuit pertaining to the legality of subsidies being made available in the federal exchange. To be more specific, it challenges an IRS rule that imposes an ACA employer mandate where the statute does not appear to authorize it. If this case were to prevail, it would undermine the “fallback” federal exchange that is going to be established for states that opt to forgo setting up their own state exchange.

Governors in SC, GA, FL, KS, VA, MO are on record that they will not set up a state exchange.  Most believe, minus the Democratic Governor of MO since a ballot question prevents him from unilaterally setting up an exchange, that the subsidies will not be available in the federal exchange, and will put the federal government between a rock and a hard place.

The election results at the state level also play into this story.

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What HHS Might Look Like Under President Romney

The world may not be ready for a Romney presidency.

Or more specifically: world leaders may not have done enough homework.

An interesting Washington Post story this week suggested that because the foreign polls have been so bullish on President Obama — 82% of Germans in one survey expected Obama to be re-elected — lawmakers around the world may be scrambling to adjust to a new team of U.S. diplomats and set of policies.

Is the health sector better prepared?

Given the close race — as of press time on Wednesday, most polls had the presidential race neck and neck — there’s been growing scrutiny of Republican health proposals. For example, the Kaiser Family Foundation and the Urban Institute on Tuesday released another report on the GOP House Budget Committee’s Medicaid plan.

But there’s been much less examination of the people who would steer Romney’s Department of Health and Human Services and the policies they’d carry out.

Possible, if Unlikely Contenders

A handful of names — all veterans of the George W. Bush administration — have been repeatedly floated as potential HHS secretaries under Romney. National Journal suggested that former HHS Secretary Michael Leavitt could return to the role. Meanwhile, ex-FDA and CMS head Mark McClellan is “the first name that comes to mind for many Republican health policy folks,” Politico’s Jennifer Haberkorn wrote earlier this year.

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United Healthcare Expands to Brazil

UnitedHealth Group is set to become the controlling owner of the largest healthcare company in Brazil, a country whose health market is rapidly growing, in one of the most high-priced overseas deals by a U.S. private insurance company.

The largest American insurer is spending $4.9 billion to acquire 90 percent of Brazil’s Amil Participacoes, which has about 5 million members, a provider network of 3,300 hospitals and 44,000 doctors, and also owns 22 hospitals and about 50 clinics, reported the Associated Press.

By entering the Brazilian healthcare market, UnitedHealth can better access the country’s 200 million population, only 25 percent of which has private insurance, at a time when Brazilian leaders increasingly are turning to private companies to insure its citizens, Reuters reported.

“Brazil has emerged as a consistently growing and evolving market for private sector health benefits and services. Its growing economy, emerging middle class and progressive policies toward managed care make it a high potential growth market,” UnitedHealth CEO Stephen Hemsley said Monday in a statement.

“Combining Amil, the clear market leader serving an under-penetrated market of nearly 200 million people, with UnitedHealth Group’s experiences and capabilities developed over the last three decades is the most compelling growth and value creation opportunity we have seen in years,” he said.

Amil’s founder Edson Bueno and his partner Dulce Pugliese will retain their 10 percent ownership of Amil for at least five years. Amil also will invest about $470 million in UnitedHealth Group shares, which it also will hold for five years, according to the Minneapolis Star-Tribune.

Care On the Continuum

My change from a traditional practice to direct-care has caused me to challenge some of the basic assumptions of the care I’ve given up to this point.  Certainly, the nature of my documentation will radically change with my freedom from the tyranny of E/M coding requirements.

Perhaps the biggest change in my care comes courtesy of the way I get paid.  The traditional way to be paid is for service rendered (either at an office visit or procedures done).  This means that I am financially motivated to give the bulk of my attention to people when they are in the office.  They are paying for my attention, so I try to give them their money’s worth.  The corollary of this is that I tend to not think about people who are not in the office to be seen.  The end-result is an episodic approach to care that is entirely dependent on the patient paying for an encounter.

There is a huge problem with this approach to care: people live their lives between encounters.  Life does not go on hold between office visits for my patients, and the impact of my care is not dependent on what happens in the encounter, but what happens between visits.  My ability to help my patients depends on my ability to affect the continuum.  If I do a good enough sales pitch for a person taking their medications, and if I consider the life-circumstance which may affect their ability to take the medicine, then I am successful.  I don’t learn about the success until their next visit (usually), and I also don’t learn about problems until then.  People are reluctant to call with problems they are having with medications, new symptoms, or other important details, often waiting for many months to tell me things I really want to know.  Perhaps they don’t want to be “one of those patients who calls all the time,” perhaps they don’t understand what I said, or maybe they’re worried I will “force them to come in” to pay for another office visit.  Regardless of the reason, I get very limited interaction with my patients in this episodic care model.

My new practice model allows for, and even encourages interaction between face-to-face encounters.  I intend on spending a significant part of my day systematically reviewing records to make sure they are up-to-date, and initiating contact if need be.  I will also give them resources to be able to manage their care (or their wellness) without having to pay for each encounter.  One reader (of another blog to be left unnamed) suggested that under this system he would get his “money’s worth” by using my service as much as possible.  For him that meant coming to see me often, but in the model of care on the continuum it would involve going to the web site and updating records, sending me questions, or watching videos I’ve made on a particular subject.  My hope is that all my patients would “get their money’s worth” between visits, and that perhaps this will reduce the need for actual face-to-face encounters.  In fact, that is the whole point of what I am doing.Continue reading…

Refocusing Long-Term Care on People: The Three I’s  

Both participants and caregivers in long-term care programs face a myriad of difficulties. Participants with long-term services and supports needs often have many health issues, meaning they are in constant transition between care environments and providers with their needs ever-evolving. As a result of visits to a number of doctors on a regular basis and the number of providers who support them, the participant’s information lives in multiple locations. This can lead to discrepancies between providers and the participant having to constantly provide the same information.

Caregivers, especially family members, are also facing great challenges. It’s a full-time job to care for someone in the home – it takes nearly 40 hours a week – and searching for a trusted service provider to take over can be another job in and of itself.

The root of the problem is that many long-term care programs are focused on the providers and not necessarily the people – those receiving the services and those providing them. Often, no one has the full picture of the participant’s health, which can lead to suboptimal care. An ideal situation is for everyone involved with the participant to be up-to-date and have a full-picture of their health and well-being at all times. When they are, services can be administered effectively with less risk for everyone involved.

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How Do We Bend the Cost Curve? Reduce the Waste.

Health care had its own version of the LeBron James “Decision” last month with the Supreme Court upholding the critically important elements of the Affordable Care Act. Now that the uncertainty is behind us―at least until the November elections―health care leaders can continue preparing their organizations for the changes ahead.

Fixing the system requires reforms at the macro level. But it also takes a symphony of smaller actions happening in concert. As experience bears out, it is difficult to agree upon a collective action with so many competing interests in health care and the partisanship that has gripped politics. But there is a song that we can all agree upon, loud and in unison. Reduce the waste.

Nearly a third of our health care costs come from wasteful spending and inefficiencies that could be avoided. Left unchecked, this is a nail in the coffin of our system; but, if tackled, is a huge cost containing opportunity. By identifying waste in the delivery system and systematically reducing it, we could lower costs without resorting to budget cuts and fees that compromise the quality of care.

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