Category: Uncategorized

Are Death Spirals Real? Has Anybody Ever Seen One?

Jan 24, 2014• 8

By THCBist

A THCB reader in Virginia writes:

“As a small business owner, I’ve been following the arguments about Obamacare with a mixture of amusement and total horror. Just when you thought Washington couldn’t screw things up any worse, they find new and creative ways to do exactly that.

My question concerns the phenomenon of the “death spiral” the terrifying sounding scenario that observers predict will occur if not enough people buy insurance. According to this theory, if not enough people buy health insurance, insurers will be forced to abandon unprofitable markets. As a business owner myself, this argument resonates. But I still don’t get it. This seems like common sense.

It is certainly true that if nobody buys my goods and services, my business will go into a “death spiral.” I will no longer be able to make a living selling my widgets. I will be forced to invent a new widget. Or go get a new job. This is like my kid saying if he doesn’t to play more Call of Duty IV he will go into an “entertainment death spiral” and be unable to do his homework ever again or be a productive member of society.

Or McDonalds warning that if too many people take up vegetarianism, its business will go into a horrible “hamburger death spiral.” So what evidence do we have? I need documentation. Like, let’s say, a picture. Or a YouTube clip.

Seriously, when has this happened? Otherwise, the death spiral thing sounds like really good economic spin to me …”

The Conservative’s Faustian Fear

Jan 24, 2014• 6

By Saurabh Jha, MD

Avik Roy has done the unthinkable. In a recent op-ed title he used “conservative’s case” and “universal healthcare” in the same sentence. And bridged these disparate words by the preposition for.

Spoiler alert: Roy has asked Republicans to embrace universal healthcare.

The Twitterverse is abuzz. An angry Gary P. Jackson, a self-affirmed conservative, tweeted:

“there is NEVER a conservative case for Marxism….especially Universal healthcare.”

Stated differently, universal healthcare is the worst form of Marxism except for all other forms of Marxism.

Thus far Roy has not been asked to produce his birth certificate, which is just as well. Roy, a prolific Forbes columnist and a scholar at the Manhattan Institute, was healthcare policy adviser to Mitt Romney. He is not a cheerleader of the Affordable Care Act.

There are things one may disagree with Roy. However, his short treatise, How Medicaid Fails the Poor, was impressive, as it deftly dealt with Medicaid’s structural problems. That a right-of-center policy analyst would write a book with that title is one of the many ironies I am now accustomed to encountering (the other delicious irony was the love of Cadillac health plans by unions).

In The Washington Examiner and National Review Online, Roy urges conservatives to acknowledge and embrace universal healthcare, in no uncertain terms:

“…[conservatives] have to agree that universal coverage is a morally worthy goal.”

The arguments put forward by Roy are pure common sense. No one objects to public education as “socialized education.” If conservatives are afraid that universal healthcare means big government, government is already heavily involved in healthcare.

And not just Medicare, which a certain tea party placard asked the government to keep its hands off!
Continue reading…

Pilots with Hospitals, the Chicken or the Egg Problem

Jan 24, 2014• 1

We know that as a health tech entrepreneur, piloting your technology and getting that first customer validation is extremely challenging. There’s frequently the ‘chicken or the egg’ problem. Most providers are unwilling to work with young technology companies that have yet to validate or prove the effectiveness of their product. Meanwhile, health technology companies need that first pilot for a chance to validate their technology. That’s why the New York City Economic Development Corporation, in partnership with Health 2.0, is excited to launch Pilot Health Tech NYC 2014, a program that provides $1,000,000 in funding to innovative projects that pilot new health technologies in New York City. The program seeks to vet and selectively match early-stage health or healthcare technology companies (‘innovators’) with key NYC healthcare service organizations and stakeholders (‘hosts’), including hospitals, physician clinics, payors, pharma companies, nursing associations, foundations, major employers, and retailers.

The 2013 program was a tremendous success, with participation from 25 provider organizations, over 250 innovator companies, 200 matchmaking meetings, 41 joint applications, and finally, 10 pilot winners. Since ‘Pilot Day’ 2013, an event during which last year’s winners were announced, the inaugural class of Pilot companies has raised more than $14 million in private investment, including $4.5 million in the last six months and their pilots have enrolled more than 1,000 patients. Check out the video below to hear what some of the winners from the 2013 program have to say!

[vimeo width=”450″ height=”315″]http://vimeo.com/84067044[/vimeo]Continue reading…

Some Predictions on How Medicare Will Release Physician Payment Data

Jan 23, 2014• 5

By CHARLES ORNSTEIN

The federal government’s announcement last week that it would begin releasing data on physician payments in the Medicare program seems to have ticked off both supporters and opponents of broader transparency in medicine.

For their part, doctor groups are worried that the information to be released by the Centers for Medicare and Medicaid Services will lack context the public needs to understand it.

“The unfettered release of raw data will result in inaccurate and misleading information,” AMA President Ardis Dee Hoven, MD, said in a statement to MedPage Today. “Because of this, the AMA strongly urges HHS to ensure that physician payment information is released only for efforts aimed at improving the quality of healthcare services and with appropriate safeguards.”

On the other hand, healthcare hacker Fred Trotter has raised concerns about CMS’ plan to evaluate requests for the data on a case-by-case basis. That isn’t much of a policy at all, he wrote, giving federal officials too much discretion about what to release.

So, how is this all going to shake out?

Three recent examples offer some clues.Continue reading…

A Little Advice for Karen DeSalvo

Jan 22, 2014• 13

By John Halamka, MD

Karen DeSalvo started as the new National Coordinator for Healthcare Information Technology on January 13, 2014. After my brief discussion with her last week, I can already tell she’s a good listener, aware of the issues, and is passionate about using healthcare IT as a tool to improve population health.

She is a cheerleader for IT, not an informatics expert. She’ll rely on others to help with the IT details, and that’s appropriate.

What advice would I give her, given the current state of healthcare IT stakeholders?

1. Rethink the Certification Program – With a new National Coordinator, we have an opportunity to redesign certification. As I’ve written about previously some of the 2014 Certification test procedures have negatively impacted the healthcare IT industry by being overly prescriptive and by requiring functionality/workflows that are unlikely to be used in the real world.

One of the most negative aspects of 2014 certification is the concept of “certification only”. No actual clinical use or attestation is required but software must be engineered to incorporate standards/processes which are not yet mature. An example is the “transmit” portion of the view/download/transmit patient/family engagement requirements.

There is not yet an ecosystem for patients to ‘transmit’ using CCDA and Direct, yet vendors are required to implement complex functionality that few will use. Another example is the use of QRDA I and QRDA III for quality reporting.

CMS cannot yet receive such files but EHRs must send them in order to be certified. The result of this certification burden is a delay in 2014 certified product availability.

The ACA: When Insurance Isn’t Insurance

Jan 21, 2014• 72

By David Dranove & Craig Garthwaite

We will be blunt. Hidden under the cloak of expanding health insurance, the Affordable Care Act (ACA) has fostered a massive subsidization of healthcare goods and services.

These subsidies often have little or anything to do with what economists would consider the “insurance” part of health insurance – providing protection against financial catastrophe.

Perhaps more troubling, if the past is prologue these subsidies will continue to grow, transferring huge amounts of money to politically favored groups and doing very little to decrease aggregate health spending – a presumed goal of health reform.

In order to understand these claims, it is necessary to take a step back and explain why insurance (of any form) is a good thing in the first place. Simply stated, insurance provides individuals with protection against unpredictable financial hardships not of their own making.

Most of us don’t like risk, and therefore we are willing to pay other people to avoid uncertain outcomes. Therefore the benefits of insurance are to protect us from uncertain events.

The key here is the uncertainty. If something is not going to cause financial distress, or the expense is relatively predictable, then, by definition, the service is not insurable. A health plan could cover the service, but that is a subsidy, i.e. other people in the insurance pool or an outside actor such as the government are simply paying for your service. It is not insurance.

Sadly, most of the discussion around what constitutes “real” health insurance under the ACA bears only a passing resemblance to the protection against financial risk that is the hallmark of insurance. For example, Secretary of Health and Human Services Kathleen Sebelius said: “Some of these folks have very high catastrophic plans that don’t pay for anything unless you get hit by a bus … They’re really mortgage protection, not health insurance.”

What does Secretary Sebelius think insurance is? We don’t expect auto insurance to pay for our gasoline.

Why Maintenance of Certification Will Make You a Better Doctor

Jan 20, 2014• 73

By Lois Margaret Nora, MD

Whether having meals with physician-relatives, attending a professional society meeting, or walking the halls of a hospital, I find that a common issue on physicians’ minds during our discussions is the American Board of Medical Specialties’ (ABMS) Board Certification process – and particularly our program for maintaining certification known as Maintenance of Certification (MOC).

Questions range from “I know you’re old enough to have grandmother status – do YOU do MOC?” (Yes) to “How can I fit this into my already insanely busy life?” Comments range from appreciation for some aspect of the program to frustration with one of the program components.

As the relatively new leader of ABMS, I welcome the opportunity to discuss issues pertaining to Board Certification and MOC. I hope this post will generate thoughtful dialogue that will result in continuing improvements to the certification process developed by ABMS and our 24 Member Boards. That, in turn, will help us render MOC more relevant and meaningful to participating physicians and will assist them in their efforts to provide quality patient care and improve our health care system.

For many years there were few, if any, requirements for maintaining ABMS Board Certification. Physicians took an exam after graduating from their residencies and thereafter had no further obligations for testing or evaluation. However, over time the error of this approach became obvious. Medical science continuously changes, and the pace of that change has accelerated.

The Great ACO Debate: 2014 Edition

Jan 19, 2014• 12

By Joseph Damore & Wes Champion

With the beginning of 2014 comes another year of the great accountable care organization (ACO) debate.

Is it a model to deliver high-quality, cost-effective care and improve population health management (PHM)? Or, just a passing fad, similar to the HMOs of decades ago?

Many opinions exist, and they’ll continue to be debated, especially during an election year. One thing most of us can agree on about ACOs is they are a work in progress.

We can say with some certainty that ACOs are taking hold; look no further than their growth, which now exceeds 600 public and private ACOs nationwide with the recent addition of 123 ACOs to the Medicare Shared Savings Program. But they still beg more questions than answers. What types and sizes of hospitals are forming ACOs, and where are they located? What does the pipeline of emerging ACOs look like, and how long will their journey take? And what capabilities, investments and partnerships are essential to ACO participation? What is the longer term performance?

Who better to ask than the decision makers running the organizations that participate in an ACO?

In August of 2013 we surveyed 115 C-suite executives– primarily CEOs (43.5%), chief financial officers (17.4%) and chief operating officers (16.5%) – across 35 states to collect data on their perspectives on ACO and PHM.

Survey results support the increase in ACO popularity. According to respondents, ACO participation has almost quadrupled since spring 2012: More than 18% say their hospitals currently participate in an ACO, up from 4.8% in spring 2012. This growth is projected to accelerate, with about 50% of respondents suggesting their hospitals will participate in an ACO by the end of 2014. Overall, 3 out of 4 senior executives surveyed say their hospitals have ACO participation plans.

Since survey respondents also represent hospitals of different locations, sizes and types, we are able to obtain a broader look at current and future ACO participation and found that:

Non-rural hospitals (82.1%) are most likely to participate in an ACO overall, followed by hospitals in an integrated delivery network (81.1%).
The lowest rates of projected participation are among rural hospitals (70.7%) and standalone hospitals (72.6%).
Large hospitals are moving more quickly, as 30.8% said they’d be part of an ACO by the end of 2013.
And though they’re equally as likely as large hospitals to ultimately participate in an ACO, small hospitals say they require additional time, with 48.6% planning to join in 2014 or 2015.

But some providers have been more deliberate and cautious about when they start their ACO journey. The pace of ACO adoption has been slower than originally anticipated 18 months ago, when more than half of executives predicted their systems would create or join an ACO by the end of 2013. Current survey results show that about 1 out of 4 will meet that projection.

Another Metric for Tracking Plan Successes

Jan 19, 2014• 2

By Jaan Sidorov, MD

Quick: If you had to chose a limited number of measures to gauge success of the Affordable Care Act, what would you choose? Would it be the number of persons who have enrolled in healthcare.gov?

The number of persons who have paid for their insurance and have coverage? The number of young people with coverage? The degree of spin used by the White House?

The U.S. House of Representatives thinks it’s an important topic. They just passed legislation requiring weekly updates on the operation of healthcare.gov.

But here is one proposed measure that can help cut through the maze of competing claims and partisan spin:

The percent of persons with either 1) “silver” or 2) “bronze” plans who have gone two or more months without paying their insurance premium.

Why, you ask? The silver and bronze plans, because their monthly premium is lower, will attract a disproportionate number of persons who were previously unable to afford health insurance and are now newly insured.

According to this just published JAMA article, even if their monthly premiums are fully or partially subsidized, these lower-cost insurance plans cover only up to 60% to 70% of medical expenses.That means cost sharing that can be excess of $6000 and $12,000 for individuals and families, respectively.

The Uninsured Are Not Signing Up for Obamacare

Jan 19, 2014• 8

By Robert Laszewski

In my last post, I asked, “But what if most of the uninsured literally don’t buy Obamacare?”

“Only 11% of consumers who bought new coverage under the law were previously uninsured,” according to a survey of 4,563 consumers eligible for the health insurance exchanges done by McKinsey & Company and reported in Saturday’s Wall Street Journal.

The Journal reports that “insurers, brokers, and consultants estimate at least two-thirds” of the 2.2 million people who have so far signed up in the new exchanges are coming from those who already had coverage.

This is consistent with anecdotal reports from insurers I have talked to that are seeing very little net growth in their overall individual and small group markets as of January 1.

That’s even worse than I thought it would be even considering the January 1 individual policy cancellations and small group renewals that are driving employers to reconsider offering coverage––and that is saying something. The vast majority of the individual cancellations, particularly because of the early renewal and extension programs, are yet to come. The same can be said for the small group renewals.

This also tells us why the first three months of the Obamacare enrollment had a relatively high average age––they came from the same market that tended to skew older that the health plans already covered.

When McKinsey asked why subsidy eligible people weren’t buying, 52% cited affordability as the reason. Readers of this blog will know that I’m not shocked to hear that given what I have been writing about the high after-tax premiums, net of the subsidies, people are finding, as well as the high deductibles and narrow provider networks the subsidized Silver and lowest cost Bronze exchange plans are offering people.

Another 30% cited “technical challenges” with the website as reasons they have not yet bought. That said, enrollment in the state exchanges that have generally been running well––California, Washington state, New York, Connecticut, Kentucky, and Colorado are also only enrolling a very small number of people relative to the number of policy cancellations in their markets and the size of their uninsured population.

Private exchange Health Markets reports that of the 7,500 people it has enrolled, 65% had prior coverage.