Tag: Accountable Care Organizations

Bernie Madoff Accounting for Medicare

Apr 25, 2012• 4

By John Goodman

On the eve of the release of this year’s Medicare Trustees report, the Obama administration released its own version of it. In the administration’s telling:

Health reform (ObamaCare) will save taxpayers $200 billion in the Medicare program through 2016.
About 90% of these savings will be produced by lowering “excessive payments” to Medicare Advantage plans, lower payments to doctors, hospitals and other providers to reflect their “improved productivity,” and through efficiencies gained by what is learned from “demonstration projects.”
The demonstration projects include pay for performance, bundling, Accountable Care Organizations, and other frequently discussed ideas.

But whereas the Trustees report is expected to be a serious document, reflecting accepted accounting principles, the administration’s document was clearly a piece of political propaganda — one that stretched the truth so much that the word “spin” would be a charitable description. For example, the administration’s document failed to mention that:

The Congressional Budget Office has studied the demonstration projects on three separate occasions (here, here and here) and each time has concluded that they are producing no serious savings and are unlikely to do so in the future.
Medicare’s Actuary has determined that reductions in payments to Medicare Advantage plans will not only result in lower benefits for the one in four seniors who are in these plans, but that about 7 ½ million enrollees will actually lose their coverage and have to seek more expensive Medigap insurance elsewhere.

Medicare Announces 27 ACOs. A New Species?

Apr 12, 2012• 22

By Vince Kuraitis

I’m surprised and intrigued by Medicare’s announcement of 27 new Shared Savings model ACOs.

Surprised

I had been anticipating this announcement as a defining moment for Medicare’s thrust into accountable care. My expectations had been that we would see either:

Boom — a big splash of new Medicare shared savings ACOs announced, including big name hospitals and medical groups that were starting large scale ACOs, perhaps with hundreds of thousands of patients.

Bust — no one showed up at the party. Providers would have concluded that Medicare ACOs were too risky, bureaucratic, and high effort.

Intrigued

What we got is something in the middle:

Very small ACOs. Many only meet Medicare’s minimum of 5K patients; most are in the 8 to 25K range; and the largest ACO anticipates 70K patients. Collectively these 27 ACOs plan to serve 375K patients, less than 1% of the entire Medicare population.
13 are smaller, physician led
Only 10 hospitals are involved across the 27 ACOs
Very few household names

Will Payers be the Business Intelligence Services of the Future?

Mar 14, 2012• 5

By JOHN HALAMKA, MD

What is a payer/insurer?

Typically, payer organizations collect premiums from employers and individuals, process claims, and engage in a variety of case management/disease management activities to encourage the appropriate use of medical resources. If they collect more premiums than claims paid, their medical loss ratio is less than 100% and they earn a profit.

In a world of accountable care organizations and healthcare reform, new reimbursement methods will include global payments to providers, which implies the risk of loss will shift from the payer to hospitals and clinicians. Payers will no longer need their large claims processing staff, nor create complex actuarial models. They’ll become very different organizations.

How different?

My prediction is that payers will become the health information exchange and analytics organizations that help hospitals and clinicians manage risk in a world of capitation.

I’ve said before that ACO=HIE+Analytics.

The payers are already making strategic acquisitions to build these new business models

Aetna acquired Medicity to gain expertise in healthcare information exchange. Aetna had already acquired Active Health to gain access to its CareEngine analytics platform.

Who Is Biz Stone and What Is Twitter?

Feb 22, 2012• 3

By Fred Trotter

Yesterday, one of the founders of Twitter, Biz Stone, gave the opening keynote at HIMSS.

This is probably going to be the best keynote at HIMSS, followed by a speech from Dr. Farzad Mostashari, which will also be excellent. It goes downhill after that: there will be a talk about politics and another talk from an “explorer.” I am sure those will be great talks, but when I go to HIMSS, I want to hear about health information technology. Want to know what @biz actually said? As usual, Twitter itself provides an instant summary.

HIMSS stands for Healthcare Information and Management Systems Society. The annual HIMSS conference is the largest Health IT gathering on the planet. Almost 40,000 people will show up to discuss healthcare information systems. Many of them will be individuals sent by their hospitals to try and find out what solutions they will need to purchase in order to meet meaningful use requirements. But many of the attendees are old school health IT experts, many of whom have spent entire careers trying to bring technology into a healthcare system that has resisted computerization tooth and nail. This year will likely break all kind of attendance records for HIMSS. Rightly so: The value of connecting thousands of health IT experts with tens of thousands who are seeking health IT experts has never been higher.

It is ironic that Biz Stone is keynoting this year’s talk, because Twitter has changed the health IT game so substantially. I say Twitter specifically, and not “social media” generally. I do not think Facebook or Google+ or your social media of choice has had nearly the impact that Twitter has had on healthcare communications.

HIMSS, and in many cases traditional health IT along with it, is experiencing something of a whirlwind. One force adding wind has been the fact that President Obama has funded EHR systems with meaningful use, and made it clear that the future of healthcare funding will take place at Accountable Care Organizations (ACO) that are paid to keep people healthy rather than to cover procedures when they are sick. It is hard to understate the importance of this. Meaningful Use and ACOs will do more to computerize medicine in five years than the previous 50 years without these incentive changes.Continue reading…

The Perfect EHR

Feb 14, 2012• 2

By John Halamka, MD

I support over 3000 clinicians in heterogeneous sites of care – solo practitioners, small offices, multi-specialty facilities, community hospitals, academic medical centers, and large group practices.

In every location there is some level of dissatisfaction with their EHR. Complaints about usability, speed of documentation, training, performance, and personalization limitations are typical. Most interesting is that users believe the grass will be greener by selecting another EHR.

I’ve heard from GE users who want Allscripts, eClinicalworks users who want Epic, Allscripts users who want AthenaHealth, and NextGen users who want eClinicalWorks.

The bottom line from every product I’ve used and everyone I’ve spoken with is that there is no current “perfect” EHR. We’re still very early in the EHR maturity lifecycle.

What is the perfect EHR? I’ve written about my best thinking, which has been incorporated into the BIDMC home built record, webOMR. (and has dissatisfied users too)

However, after listening to many “grass is greener” stories, I believe that what a provider perceives as a better EHR often represents trade offs in functionality. One EHR may have better prescribing functionality while another has better letters, another is more integrated and another has better support. The “best” EHRs, according to providers, varies by what is most important to that individual provider/practice, which may not be consistent with enterprise goals or the needs of an Accountable Care Organization.

Context Is Everything

Feb 10, 2012• 5

By Joseph Kvedar

A few weeks ago, I had the opportunity to talk with an innovative company about a new product. I make it a policy not to endorse any particular company or product on this blog, so this is not an endorsement. Rather it is a fascinating story that tells us lots about human nature and gives us clues on how we should design healthcare programs, apps, etc. as we move into the world of patient engagement and accountability. And we are moving there. Whether your focus is achieving meaningful use of your EMR (increasingly we’re going to be graded on how we engage our patients in this regard), the journey to becoming an Accountable Care Organization (as we enter an environment where we’re compensated for quality and efficiency, patient engagement becomes key) or simply that you realize that we don’t have enough healthcare providers to take care of all those folks who need it (in this case, patient engagement becomes a tool to give patients the opportunity to be their own providers, taking work off of our beleaguered primary care workforce), patient engagement is all the rage.

Right out of the gate, we health care providers have a big hill to climb. We are the ones who remind you that you are sick. Who wants to be engaged with that? Once patients get into the mindset of being sick, the context becomes pain, suffering, inconvenience, depression, time out of work, rehabilitation, and on and on. It’s no wonder that patients don’t engage much (other than the occasional masochist among us). And the conversation immediately gravitates to whether insurance will pay or not. We’ve observed patients in our connected health programs who are happy to go to the sporting goods store to fork over their own money for a heart rate monitor so they can watch their heart rate during a work out, but baulk at paying for a blood pressure monitor to be part of a hypertension program. After all, fitness is your own business, but when we’re talking about sickness your insurer owes you ….

The Perfect Storm For Innovation

Feb 6, 2012• 7

By JOHN HALAMKA

In my career, there have been a few perfect storms, defined as “a confluence, resulting in an event of unusual magnitude”.

When I was an undergraduate at Stanford University in 1980, two geeky guys named Jobs and Wozniak dropped by the Homebrew Computer Club to demonstrate a kit designed in their garage. IBM introduced the Personal Computer and MSDOS 1.0. I purchased an early copy of Microsoft Basic and began creating software in my dorm room including early versions of tax calculation software, an econometric modeling language, and electronic data interchange tools. Every day brought a new opportunity. The energies of hundreds of entrepreneurs created an industry in a few intensely creative months that laid the foundation for the architecture and tools still in use today. A guy named Gates offered me a job and I decided to stay in school instead.

In 2001 when I was first hired at Harvard, a visionary Dean for Medical Education, a supportive Dean of the Medical School, talented new development staff, and a sleepless MD/Phd student came together to create one of the first Learning Management Systems in the country, Mycourses. Robust web technologies, voice recognition, search engines, early mobile devices, and new multi-media streaming standards coincided with resources, strong governance, and a sense of urgency. Magic happened and in a matter of months, an entire platform was created that is still powering the medical school today.

It Takes a CEO to Save the U.S. Health-Care System

Feb 2, 2012• 22

By Darrell Moon

Forget Washington and the political debate over Obamacare. The real battle for the future of health care is being fought in the world of business, where tens of thousands of companies have seen their financial well-being undermined by skyrocketing employee health costs.

Although few people realize it, employee health costs have now become the third-largest expenditure for U.S. businesses today, constituting a whopping 8 percent of total compensation. And they are rising fast, more than doubling in just the last decade to more than $15,000 a year for family coverage. Of that cost, 73 percent is paid by the employer.

Yet most chief executive officers are curiously passive, failing to employ even the most basic management tools and market incentives to deal with the problem. Employees and employers alike — but first and foremost the boss — need to be held accountable for reducing the cost burden that is damaging so many companies’ bottom lines.

Here are seven things that CEOs can do:

No. 1: Give incentives to insurance brokers.

Most employers buy their health insurance through brokers who make more money when the plan costs more. Not exactly a smart way to get market forces working in your favor. Better to pay brokers on a fee-for-service basis. Better still to offer them a bonus tied to the amount by which they can reduce a plan’s costs, not a plan’s benefits.

No. 2: Give incentives to your managers.

Every CEO learned in business school that if you want to achieve a key business objective — be it launching a new product or reducing company health costs — you need to provide incentives to managers to help you succeed. Yet rare is the boss who offers bonuses to human-resources and benefits managers who reduce claims costs for the company. It’s long past the time for CEOs to get the incentives working in the right direction inside their companies, as well.

Now you have healthcare data. So where does it go?

Jan 27, 2012• 4

By Paul Grundy, MD

In the next 10 years, data and the ability to analyze the data will do for the doctor’s mind what x-ray and medical imaging have done for their vision. How? By turning data into actionable information.

For instance, take Watson, IBM’s intelligent supercomputer. Watson can analyze the meaning and context of human language, and quickly process vast amounts of information. With this information, it can suggest options targeted to a patient’s circumstances. This is an example of technology that can help physicians and nurses identify the most effective courses of treatment for their patients. And fast: in less than 3 seconds Watson can sift through the equivalent of about 200 million pages, evaluate the information, and provide precise responses. With medical information doubling every 5 years, advanced health analytic systems technologies can help improve patient care through the delivery of up- to-date, evidence-based health care.

Newt Gingrich Reveals His Inner Democrat

Jan 22, 2012• 8

By Al Lewis

Perhaps Newt Gingrich’s book Saving Lives & Saving Money has been quietly redacted of a few lines since its original 2003 printing, because otherwise a simple read of the copies now in circulation would find a blueprint for Obamacare just like the first printing did. I dusted off my old, autographed, copy and re-read it, and am providing some highlights for THCB readers.

Much of the book does propose market-based solutions, such as the use of disease management programs to “dramatically improve outcomes.” However, the book also calls for bigger government, in the form of (1) drug coverage for seniors (since passed) and (2) a “tripling” of the National Science Foundation budget.

In addition to those two specific calls for increased government spending, the first printing contains language that might comfort Don Berwick more than Fox News, and not just because Dr. Berwick gets favorably mentioned twice.

Some samples:

P. 31: “The number of uninsured in America is a threat to our civilization.”

P. 54 “Don Berwick[has] pioneered the translation of the teachings of quality experts such as Edwards Deming and Joseph Juran to the healthcare profession.”

P 59 “It is justified to mandate the use of electronic systems to drag the medical system into the 21^st century.”