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Tag: The States

The Founding Fathers Write a Grant Proposal

“Just look at this second sentence!” groaned Samuel Adams. “‘We hold these truths to be self-evident . .’ This flies in the face of ‘evidence-based practice’! We’ll never get funded!”

Another delegate had a different complaint: “This mission statement is way too long!” he wailed. “Mr. Jefferson, no one will ever read this ‘Declaration of Independence’ of yours.”

In the meantime, George Washington had been working up a budget for the revolutionary war (earlier called the innovative war). His initial figures were daunting: $37 million would have to be raised by the collaborative, which would need to be matched by $114 million from the states. And of course, they didn’t have a dime (or rather, a shilling).

But let’s go back to the meeting, where they had just decided to give the collaborative a name: the Continental Congress.

Donor Prospecting

The meeting chair pounded his gavel: “Next on the agenda is Fundraising Prospects. Mr. Hancock, your report?”

John Hancock looked up, startled, but recovered his poise: “We’ve developed a list of foundations to approach. Unfortunately, none of them have giving areas that include democratic revolutions, perhaps because there hasn’t been a democratic revolution before. They also want to know who else is funding it, and how we’re going to continue the funding when their grants run out. And several of them aren’t funding right now because they’re doing something called ‘strategic planning.’Continue reading…

Why HHS Created Partnership Exchanges and Why More States Are Choosing Them

New Hampshire: We’re in.

North Carolina: We’re not.

The two states on Tuesday were the latest to announce their intentions on the Affordable Care Act’s health insurance exchanges. States have until Feb. 15 to tell HHS whether they’ll retain even some control over the exchanges, or let the Obama administration run the exchanges for them.

And while New Hampshire made clear that it wants to partner with the federal government to launch an insurance exchange, North Carolina backed out of a previous plan to do exactly that.

By Friday, we’ll know where half a dozen other states stand, too.

Background on Partnership Model
The Affordable Care Act didn’t originally spell out the partnership model; under the law, states faced a binary choice of running their own insurance exchanges or punting the responsibility to the government.

But HHS officials realized they needed to tweak the ACA’s approach, as more than 30 states — increasingly led by Republicans, who took over 11 statehouses in the 2010 election — announced they planned to opt out of the exchanges altogether. This would leave HHS officials with “an awesome task in establishing and operating exchanges in [so many] different states and coordinating those operations with state Medicaid programs and insurance departments,” before open enrollment begins in October 2013, Paul Starr writes in The American Prospect.

As a result, the agency in 2011 introduced the partnership model in hopes of shifting some of the responsibility for running exchanges back to the states.

Under the hybrid approach, the federal government takes on setting up the exchange’s website and other back-end responsibilities, while states keep functions such as approving health plans and setting up consumer assistance programs. HHS also hopes that the partnership model will be a path for states that weren’t ready to run their own exchanges to take them over eventually.

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The Gold Plated Health Care System: What the New Numbers Tell Us about the State of the Economy

For the third year in a row, national health spending in 2011 grew less than 4 percent, according to the CMS Office of the Actuary.  However, the report said modest rebounds in pharmaceutical spending and physician visits pointed toward an acceleration of costs in 2012 and beyond.  CMS’s analysts make much of the cyclical character of health spending’s relationship to economic growth and also forecast a doubling of cost growth in 2014 to coincide with the implementation of health reform.

This non-economist respectfully disagrees and believes the pause could be more durable, even after 2014.   Something deeper and more troublesome than the recession is at work here.  As observed last year, the health spending curve actually bent downward a decade ago, four years before the economic crisis. Health cost growth has now spent three years at a pre-Medicare (indeed, a pre-Kennedy Administration) low.

More Than The Recession Is At Work

Hospital inpatient admissions have been flat for nine years, and down for the past two, despite compelling incentives for hospitals to admit more patients. Even hospital outpatient volumes flat-lined in 2010 and 2011, after, seemingly, decades of near double-digit growth.  Physician office visits peaked eight years ago, in 2005, and fell 10 percent from 2009 to 2011 before a modest rebound late in 2011 — all this despite the irresistible power of fee-for-service incentives to induce demand.

The modest rebound in pharmaceutical spending (2.9 percent growth) in 2011 appears to have been a blip.  IMS Health reports that US pharmaceutical sales actually shrank in 2012, for the first time in recorded history, and that generic drugs vaulted to the high 70s as a percent of prescriptions!

There is no question that the recession’s 7-million increase in the uninsured depressed cost growth.  But the main reason health cost growth has been slowing for ten years is the steadily growing number of Americans — insured or otherwise — that cannot afford to use the health system.  The cost of health care may have played an unscripted role in the 2008 economic collapse.  A 2011 analysis published in Health Affairs found that after accounting for increased health premium contributions, out-of-pocket spending growth and general inflation, families had a princely $95 more a month to spend on non-health items in 2009 than a decade earlier.  To maintain their living standards, families doubled their household debt in just five years (2003-2008), a debt load that proved unsustainable.  When consumers began defaulting on their mortgages, credit cards and car loans, the resultant chain reaction brought down our financial markets, and nearly resulted in a depression.

By sucking up consumers’ income since 2008, the rising cost of health benefits has weighed heavily upon the recovery.  According to the 2012 Milliman Cost Index, the cost of health coverage rose by 32.8 percent from 2008 to 2012, while family income did not grow at all in real terms.  The total cost (employer and employee contributions plus OOP spending) of a standard PPO policy for a US family of four was $20,700, almost 42 percent of the US household median income in 2012.

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And With the Stroke of a Pen, Health Insurance Exchanges Become Health Insurance Marketplaces ….

Thanks to David Kerrigan of the Massachusetts Health Connector for pointing out that the Obama Administration has suddenly switched terminology: health insurance exchanges are now health insurance marketplaces. I think it’s a great idea, which is why I wrote a blog post on this very topic on Friday. The Hill (Obama officials ditch ‘exchanges’ in rebranding of healthcare reform law) covers the story.

However, the Hill has a weird angle on this. The article heavily features an anti-ObamaCare activist, Dean Clancy who says:

“They could call them motherhood or apple pie, but it wouldn’t change our feelings about them… We’re encouraged that they’re showing signs of desperation. I think that it’s too late in the game to try to start calling this something different. And [we’re] not going to spend a lot of effort fighting over a word.”

Clancy’s website is called blockexchanges.com, so he may actually have more commitment to the word exchange than the Obama folks. Somehow blockmarketplaces.com just doesn’t have the same ring to it. (That domain is still available at this writing in case you want to grab it.) Blockexchanges also has some misleading information on its home page:

“Remember, without the state exchanges, ObamaCare cannot function.”

Actually, the federal government will step in if the states don’t.

Personally, I don’t sense desperation but rather a gradual wising up about what implementation will require. The term “marketplace” makes a good deal of sense for someone who is comparison shopping for health insurance. Here’s to more commonsense improvements as ObamaCare is rolled out.

David E. Williams is co-founder of MedPharma Partners LLC, strategy consultant in technology enabled health care services, pharma, biotech, and medical devices. Formerly with BCG and LEK. He writes regularly at Health Business Blog, where this post first appeared.

So, What Exactly Is a Health Insurance Exchange Anyway???


I’m a health care expert who follows health reform closely, so when I’m confused about something I know most people are.

When Massachusetts passed the universal coverage law in 2006 I didn’t understand exactly what the Connector was supposed to do. If they had called it a health insurance store or marketplace or comparison site I would have grasped the concept better. Once it’s explained it’s obvious, but why use the word “connector” in the first place?

The federal Affordable Care Act makes matters even worse. It calls these things health insurance “exchanges.”

That word has the wrong connotations. When I hear the word “exchange” I think of a stock exchange. That’s not somewhere I go to buy or compare products or services to use. Others think of “exchange” as what they do when they made a purchase that was the wrong size or received a gift they didn’t like.

Even for health wonks that fully grasp the concept, the word “exchange” is confusing, because the term is also used in the context of health information exchanges, which are used to exchange clinical data. I often hear people asking about the impact of the “exchange” –without specifying “insurance exchange” or “information exchange,” and I have to ask them which they mean.

There’s a simple solution to this: let’s dump the word “exchange” and use a term that’s more understandable and appropriate. How about:

  • Store
  • Marketplace
  • Comparison site
  • Supermarket

David E. Williams is co-founder of MedPharma Partners LLC, strategy consultant in technology enabled health care services, pharma, biotech, and medical devices. Formerly with BCG and LEK. He writes regularly at Health Business Blog, where this post first appeared.

Inside Three ACOs: Why California Providers Are Opting for the Model

Visit SDIndyACO.com, and you’re greeted by a Hawaiian shirt hanging in an otherwise empty closet. “Future home of something quite cool,” the page’s headline reads.

Forget unicorns, camels and all the other metaphors used to describe accountable care organizations these past few years.

The website — the homepage of the newly formed San Diego Independent ACO, which was one of 106 organizations named last week to Medicare’s Shared Savings Program — could sum up where we stand now on ACOs.

While we’re close enough to see their outline, some ACOs are still just teasing their promise. Many organizations have yet to launch a Web presence (or in San Diego Independent ACO’s case, are waiting to get CMS approval). And more health care providers are rushing to build the ACO structure in hopes of winning federal contracts — and filling out the details later.

Understanding the Medicare ACO Model

The ACO model is loosely defined as having integrated teams of providers share responsibility for caring for a select population of patients. (That isn’t a new idea — and based on that definition, California’s had dozens of physician-led groups and integrated networks essentially operating as ACOs for years.)

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Roundup of State Ballot Initiatives on Health Issues

This November, voters weighed in on an array of state ballot initiatives on health issues from medical marijuana to health care reform. Ballot outcomes by state are listed below (more after the jump).

Voters in Alabama, Montana, and Wyoming passed initiatives expressing disapproval of the Affordable Care Act, while a similar initiative in Florida garnered a majority of the vote but failed to pass under the state’s supermajority voting requirement. Missouri voters passed a ballot initiative prohibiting the state executive branch from establishing a health insurance exchange, leaving this task to the federal government or state legislature.

Florida voters defeated a measure that would have prohibited the use of state funds for abortions, while Montana voters passed a parental notification requirement for minors seeking abortions (with a judicial waiver provision).

Perhaps surprisingly, California voters failed to pass a law requiring mandatory labeling of genetically engineered food. Several states legalized medical marijuana, while Arkansas voters struck down a medical marijuana initiative and Montana voters made existing medical marijuana laws more restrictive.

Colorado and Washington legalized all marijuana use, while a similar measure failed in Oregon.

Physician-assisted suicide was barely defeated in Massachusetts (51% to 49%), while North Dakotans banned smoking in indoor workplaces. Michigan voters failed to pass an initiative increasing the regulation of home health workers, while Louisiana voters prohibited the appropriation of state Medicaid trust funds for other purposes.

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The Eight-Year Journey to Accountable Care

Now that the healthcare industry can work with clarity on care coordination strategies and programs, a new expansion of ACO models, trends in patient behavior and the companion issue of provider scope of practice have quickly emerged as critically-relevant spotlights. Historical perspective helps.

Simply put, even with the political tumult this fall, there is strong bipartisan support for aligning payment and care delivery models with improving quality to create a smarter and sustainable healthcare system, backed by historical precedent.

For me and my colleagues in the trenches of pursuing fiscally sound care delivery nearly a decade ago, it is well remembered that the origins of accountable care reside within a 2004 HHS document entitled “The Decade of Health Information Technology: Delivering Consumer-centric and Information-rich Health Care.” This “Framework for Strategic Action” (as it is also known) was delivered to then-HHS Secretary and GOP-appointee Tommy Thompson. And it was delivered by the nation’s first National Coordinator for Health Information Technology, Dr. David Brailer.

The document’s goals of introducing health IT solutions to clinical practices, electronically connecting clinicians, using “information tools” to personalize care and advance population health reporting followed an executive order calling for widespread adoption of interoperable EHRs within 10 years.

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Ensuring the Long-Term Viability of Health Insurance Exchanges

November 16 marks the deadline for states to submit their plans for establishing a health insurance exchange—or HIX—either on their own or with some level of assistance from the federal government. For those states, a majority, according to Kaiser Family Foundation research, have yet to set up a HIX or develop concrete plans to do so. That’s an uncomfortably tight timeline in which to make some tough decisions.

According to the Supreme Court’s June ruling on the Affordable Care Act, states will no longer forfeit federal funding for Medicaid if they choose not to expand their Medicaid programs to all residents with incomes below 138 percent of the federal poverty level. Nevertheless, they must ensure coverage for an estimated 16 million currently uninsured people with an income between 100 percent and 400 percent of that poverty level. And by October 2013, each state needs to demonstrate that it has a HIX in place that can provide such cover: A user-friendly, one-stop shop for affordable healthcare, or affirmatively state that it intends to participate in the Federal exchange..

A HIX needs to have sufficient scale to support large and balanced risk pools. But there may not be sufficient numbers of uninsured state residents to make the HIX viable, particularly if a state is small, or has an extensive Medicaid program already in place. How will such states attract and sustain enrollment? How will they attract payers?

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A Time for Boundless Energy and Optimism

2012 has been a challenging year for me.

On the personal side, my wife had cancer. Together we moved two households, relocated her studio, and closed her gallery. This week my mother broke her hip in Los Angeles and I’m writing from her hospital room as we finalize her discharge and home care plan before I fly back to Boston.

On the business side, the IT community around me has worked hard on Meaningful Use Stage 2, the Massachusetts State Health Information Exchange, improvements in data security, groundbreaking new applications, and complex projects like ICD10 with enormous scope.

We did all this with boundless energy and optimism, knowing that every day we’re creating a foundation that will improve the future for our country, communities, and families.

My personal life has never been better – Kathy’s cancer is in remission, our farm is thriving, and our daughter is maturing into a fine young woman at Tufts University.

My business life has never been better – Meaningful Use Stage 2 provides new rigorous standards for content/vocabulary/transport at a time when EHR use has doubled since 2008, the State HIE goes live in one week, and BIDMC was voted the number #1 IT organization the country.

It’s clear that many have discounted the amazing accomplishments that we’ve all made, overcoming technology and political barriers with questions such as “how can we?” and “why not?” rather than “why is it taking so long?” They would rather pursue their own goals – be they election year politics, academic recognition, or readership traffic on a website.

As many have seen, this letter from the Ways and Means Committee makes comments about standards that clearly have no other purpose than election year politics. These House members are very smart people and I have great respect for their staff. I’m happy to walk them through the Standards and Certification Regulations (MU stage 1 and stage 2) so they understand that the majority of their letter is simply not true – it ignores the work of hundreds of people over thousands of hours to close the standards gaps via open, transparent, and bipartisan harmonization in both the Bush and Obama administrations.

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