A new report by economist Jon Gabel and his colleagues at NORC, a research center affiliated with the University of Chicago, looked at the use of transparency tools in an employer health plan. The analysis found the use of price transparency tools to be spotty. For instance, 75 percent of households either did not log into the transparency tool or did so only one time in the 18-month period of study. Fifteen percent did so twice; but only 1 percent logged in 6 times or more. The authors concluded:
It could very well be that we are asking too much of a single tool, no matter how well-designed. Consumer information for other goods and services on price and quality are seldom dependent upon information gained mainly, if not solely, through a digital tool. Rather, information on relative value is spread far and wide through advertising and other kinds of promotion using conventional, digital, and social media communication channels.
An earlier Harvard study on transparency tools, published in JAMA, found patients do not tend to use the tools to comparison shop for lower prices (in fact, spending rose slightly). An NBER study concluded that when transparency tools do lower spending, it is because consumers used to tools to identify prices and use the information to decide whether they can afford the service and skip it if they cannot.
The transparency tool in the current study also emailed “Ways to Save” suggestions on how consumers could reduce medical spending. The authors made an important observation:
It is also possible that the message on the “Ways to Save” e-mail turned off many households. While the emails did highlight opportunities to save a specific amount of money, a vast majority of the savings were for the employer and a much smaller amount of savings applied to the employee. It is possible that many employees viewed the transparency initiative as simply a means for the employer to save money.
The hype around wearables is deafening. I say this from the perspective of someone who saw their application in chronic illness management 15 years ago. Of course, at that time, it was less about wearables and more about sensors in the home, but the concept was the same.
Over the years, we’ve seen growing signs that wearables were going to be all the rage. In 2005, we adopted the moniker ‘Connected Health’ and the slogan, “Bring health care into the day-to-day lives of our patients,” shortly thereafter. About 18 months ago, we launched Wellocracy, in an effort to educate consumers about the power of self-tracking as a tool for health improvement. All of this attention to wearables warms my heart. In fact, Fitbit (the Kleenex of the industry) is rumored to be going public in the near future.
So when the headline, “Here’s Proof that Pricey Fitness Wearables Really Aren’t Worth It,” came through on the Huffington Post this week, I had to click through and see what was going on. Low and behold this catchy headline was referring to a study by some friends (and very esteemed colleagues) from the University of Pennsylvania, Mitesh Patel and Kevin Volpp.
I’m sorry I haven’t had a chance to blog in a while – I took a new job as the Director of the Harvard Global Health Institute and it has completely consumed my life. I’ve decided it’s time to stop whining and start writing again, and I’m leading off with a piece about adjusting for socioeconomic status. It’s pretty controversial – and a topic where I have changed my mind. I used to be against it – but having spent some more time thinking about it, it’s the right thing to do under specific circumstances. This blog is about how I came to change my mind – and the data that got me there.
Changing my mind on SES Risk Adjustment
We recently had a readmission – a straightforward case, really. Mr. Jones, a 64 year-old homeless veteran, intermittently took his diabetes medications and would often run out. He had recently been discharged from our hospital (a VA hospital) after admission for hyperglycemia. The discharging team had been meticulous in their care. At the time of discharge, they had simplified his medication regimen, called him at his shelter to check in a few days later, and set up a primary care appointment. They had done basically everything, short of finding Mr. Jones an apartment.
Ten days later, Mr. Jones was back — readmitted with a blood glucose of 600, severely dehydrated and in kidney failure. His medications had been stolen at the shelter, he reported, and he’d never made it to his primary care appointment. And then it was too late, and he was back in the hospital.
The following afternoon, I spoke with one of the best statisticians at Harvard, Alan Zaslavsky, about the case. This is why we need to adjust quality measures for socioeconomic status (SES), he said. I’m worried, I said. Hospitals shouldn’t get credit for providing bad care to poor patients. Mr. Jones had a real readmission – and the hospital should own up to it. Adjusting for SES, I worried, might create a lower standard of care for poor patients and thus, create the “soft bigotry of low expectations” that perpetuates disparities. But Alan made me wonder: would it really?
To adjust or not to adjust?
Because of Alan’s prompting, I re-examined my assumptions about adjustment for SES. As he walked me through the data, I concluded that the issue of adjustment was far more nuanced than I had appreciated.
Here’s a super-concentrated summary of the three articles: The hip surgery is more expensive because, in the US, as many as 10 intermediaries mark-up the price of that same hip prosthesis. Then, Tilburt et al said in JAMA that “physicians report that almost everyone but physicians bears responsibility for controlling health care costs.” The physicians reported that lawyers (60%), insurance companies (59%), drug and device manufacturers (56%), even hospitals (56%) and patients (52%) bear a major responsibility to control health care costs. Finally, CMS is trying to balance the privacy interests of physicians with the market failure that my other two lemons illustrate.
Can we apply local movement principles to health reform? How much of our money can we keep with our neighbors? What policies and technologies would enable the health care locavore? The locavore health system couldn’t possibly be more expensive than what we have now and, as with food and crafts, more of the money we spend would benefit our neighbors and improve our community.
A controversial study published earlier this year in the Journal of the American Medical Association shows that overweight people have significantly lower mortality risk than normal weight individuals, and slightly obese people have the same mortality risk as normal weight individuals.
This meta-analysis, headed by statistician Katherine Flegal, Ph.D., at the National Center for Health Statistics, looked at almost 100 studies that included 3 million people and over 270,000 deaths. They concluded that while overweight and slightly obese appears protective against early mortality, those with a body mass index (BMI) over 35 have a clear increase in risk of early death. The conclusions of this meta-analysis are consistent with other observations of lower mortality among overweight and moderately obese patients.
Many public health practitioners are concerned with the ways these findings are being presented to the public. Virginia Hughes in Nature explains “some public-health experts fear…that people could take that message as a general endorsement of weight gain.” Health practitioners are understandably in disagreement how best to translate these findings into policy, bringing up the utility of BMI in assessing risk in the first place.
Walter Willett, chair of the nutrition department at the Harvard School of Public Health, told National Public Radio that “this study is really a pile of rubbish, and no one should waste their time reading it.” He argues that weight and BMI remain only one measure of health risk, and that practitioners need to look at the individual’s habits and lifestyle taken as a whole.
A trio of groundbreaking publications on healthcare came out this April. They are my required reading list for CEOs. First is a study published in last week’s Journal of the American Medical Association (JAMA) by Eappen and colleagues (including among them Atul Gawande). The study found infections occurred in 5 percent of all surgeries in an unnamed southern hospital system. For U.S. hospitals, this is not an unusual rate of error — even though it is about 100 times higher than what most manufacturing plants would tolerate. No automaker would stay in business if 5 percent of their cars had a potentially fatal mechanical flaw.
If that’s not bad enough, the second finding is where we enter the realm of the absurd: according to the study, purchasers paid the hospital to make these errors. Medicare paid a bonus of more than $3000 for each one of the infections; Medicaid got a relative “bargain,” paying only $900 per infection. But the real chumps were the commercial purchasers (CEOs, that’s you). Employers and other purchasers paid $39,000 for each infection, twelve times as much as your government paid through Medicare. Most companies could create a good job with $39,000, but instead they paid a hospital for the privilege of infecting an employee. How many good jobs haven’t been created so businesses can pay for this waste?
Most employers are far more hard-nosed about managing their purchase of, say, office supplies than they are in purchasing health care — even though, unlike healthcare, paperclips never killed anyone and no stapler can singlehandedly sap a company’s quarterly profit margin. Yet, according to the Catalyst for Payment Reform, only about 11 percent of dollars purchasers paid to healthcare providers are tied in any way to quality. The results reflect this neglect of fundamental business principles for purchasing: Quality and safety problems remain rampant and unabated in health care, while employer health costs have doubled in a decade. Continue reading…
There’s a high-profile and important paper in JAMA this week by Sunil Eappen and colleagues. The study looked at surgical discharges during 2010 from a single 12-hospital system and came to the conclusion that admissions that include a surgical complication were associated with a higher profit (defined as the contribution margin) than admissions without complications. The authors conclude that this creates a disincentive for hospitals preventing surgical complications since they might see reduced profits as a result. This is a very provocative finding and it’s getting a lot of well-placed media attention, as you might expect. There is an important caveat with the study that I would like to highlight.
In the study, the authors report that admissions with surgical complications result in $39,000 higher “profits” if the care is reimbursed via a private payer and $1800 if Medicare is the payer. However, as Dr. Reinhardt correctly noted in the editorial,
“Allocating profit and loss is exquisitely sensitive to the many assumptions made in economic modeling and must be performed carefully to provide useful evidence about the financial ramifications of surgical complications and other services.“
His concern dealt mostly with how the authors allocated fixed costs in their calculations. My concern has to do with what the authors assumed happens to an empty bed once a patient is discharged in a US hospital.
An important study in the Journal of the American Medical Association finds that misdiagnosis is more common than you might think. According to the study, almost 40% of patients who unexpectedly returned after an initial primary care visit had been misdiagnosed. Almost 80% of the misdiagnoses were tied to problems in doctor-patient communication, and more than half of those problems had to do with things that were missed in the patient’s medical history.
The results of this study shouldn’t be surprising if you’re a regular reader here – they are another example of a system that isn’t working as well as it could for patients, and doctors. Doctors – and the medical professionals who help them in their work – are the best educated and best trained than they have ever been. They have more access to medical information and technology than at any time in our history. And yet, U.S. government data show that the typical doctor visit involves 15 minutes or less with your doctor. Medical records are kept in fragmented, uncoordinated ways.
Ensuring that Americans who live in rural areas have access to health care has always been a policy priority. In healthcare, where nearly every policy decision seems contentious and partisan, there has been widespread, bipartisan support for helping providers who work in rural areas. The hallmark of the policy effort has been the Critical Access Hospital (CAH) program– and new evidence from our latest paper in the Journal of the American Medical Association suggests that our approach needs rethinking. In our desire to help providers that care for Americans living in rural areas, we may have forgotten a key lesson: it’s not about access to care. It’s about access to high-quality care. And on that policy goal, we’re not doing a very good job.
A little background will be helpful. In the 1980s and 1990s, a large number of rural hospitals closed as the number of people living in rural areas declined and Medicare’s Prospective Payment System made it more difficult for some hospitals to manage their costs. A series of policy efforts culminated in Congress creating the Critical Access Hospital program as part of the Balanced Budget Act of 1997. The goals of the program were simple: provide cost-based reimbursement so that hospitals that were in isolated areas could become financially stable and provide “critical access” to the millions of Americans living in these areas. Congress created specific criteria to receive a CAH designation: hospitals had to have 25 or fewer acute-care beds and had to be at least 35 miles from the nearest facility (or 15 miles if one needed to cross mountains or rivers). By many accounts, the program was a “success” – rural hospital closures fell as many institutions joined the program. There was widespread consensus that the program had worked.
Despite this success, there were two important problems in the legislation, and the way it was executed, that laid the groundwork for the difficulties of today. Continue reading…
This correspondent says the article is what is muddled and that the readers of JAMA deserve better.
According to the authors, after the Affordable Care Act launched the Medicare Accountable Care Organizations (ACOs), their stated purpose has morphed from Health-System Ver. 2.0 controlling the chronic care costs of their assigned patients to Health System Ver. 3.0 collaboratively addressing “population health” for an entire geography.
Between the here of “improving chronic care” and the there of “population health,” Drs Noble and Casalino believe ACOs are going to have to confront the additional burdens of preventive care, social services, public health, housing, education, poverty and nutrition. That makes the authors wonder if the term “population health” in the context of ACOs is unclear. If so, that lack of clarity could ultimately lead naive politicians, policymakers, academics and patients to be disappointed when ACOs start reporting outcomes that are limited to chronic conditions.