The Health Care Blog – Page 1138 – Everything you always wanted to know about the Health Care system. But were afraid to ask.

Above the Fold

PBMs/HEALTH PLANS: Medco makes out; Kaiser not so pretty

Aug 7, 2006• 2

So Medco is making even more money by switching to generics.

Medco Health Solutions Inc. reported a 24 percent jump in second-quarter earnings and raised its profit forecast, citing speculation that a generic version of the top-selling blood thinner Plavix may soon be available. Net income rose to $170.9 million, or 56 cents a share, driven by an increased number of customers and higher sales of generic drugs.

You wonder how long their customers will take to figure out that what they’re giving back in rebates they’re taking in spreads that they charge on generics. Apparently the answer is, a long time!

Meanwhile, Kaiser had not such a good quarter, in that their revenues and membership went up but their profits went down to $272m for the quarter.

Kaiser Permanente’s hospital and health plan units saw membership and revenue climb in the second quarter, but quarterly profits plummeted by $91 million or 25 percent from a year earlier, the giant health-care system reported Friday. Officials at Oakland-based Kaiser attributed the steep net income decline to increased operating expenses, "including those associated with the continued investment in facilities expansion, seismic retrofitting and care delivery programs." George Halvorson, chairman and CEO of Kaiser’s health plan and hospital operations, said in an Aug. 4 statement that the giant system is using its earnings "to make important investments" in programs, services, facilities and technology. No further details were immediately available. Systemwide revenue for the quarter jumped from $7.7 billion last year to $8.5 billion this year, a nearly 10.4 percent increase. Enrollment jumped by nearly 44,000 members to about 8.59 million nationwide, more than 75 percent of them in California.

Of course that’s not necessarily a bad thing — it may mean relatively more money was spent on patient care — and at least they avoided the real bloodbath that seemed to be developing at the end of last year when it lost $211 million in Q4. But there remains a whopping big fine to come for the kidney transplant fiasco, so they’re not out of the woods yet.

TECH: It’s not how big your cross is, it’s where you put it

Aug 4, 2006• 1

English comedian Jasper Carrot once did a great election night skit which had a parent explaining politics to a kid in the same way they explain the birds and bees. Hence the line “It’s not how big your cross is, it’s where you put it” (Yes in the UK people just put a cross next to the name on the ballot paper, and the polls stay open way longer, but their electoral results aren’t ridden with fraud….unlike here)

A new article in iHealthbeat by Colleen Egan basically says that same thing about CPOE. Essentially Seattle Childrens and Pittsburgh Childrens both put in Cerner’s Powerchart in their Pediatric ICU. The title is Not Quite the Same: CPOE Studies Using Identical Technology Report Different Results.

Pittsburgh you may recall saw a big rise in infant mortality. Seattle saw a slight drop.

What was the difference? As I said in THCB when the Pittsburgh brou-ha-ha broke, it’s process. Particularly getting the clinicians involved in the implementation and workflow design.

For example, unlike Pittsburgh, Seattle “had active involvement of [the] intensive care unit staff during the design, build and implementation stages,” according to the study. Also, “Both institutions placed a great deal of effort in designing and implementing order sets, but CHP did not have the order sets for the critical care setting available at implementation,” the CHRMC study notes. According to the Seattle study, “implementation issues … rather than inherent issues with the CPOE itself … are the primary risk factors affecting mortality during implementation of CPOE.” Del Beccaro notes that CHP did not have the benefit of extensive previous data or studies to use as a model, so “some of the things they learned were by trial and error.”

That’s no surprise and it goes for virtually every kind of major software implementation—including of course CPOE, as we’ve known from the days of the Cedars-Sinai debacle.

BLOGS: Yet more abuse of Federal power?

Aug 4, 2006• 1

Go to the TIME Magazine site and click on the story in the right column below the picture of Madonna called “Blogging all the way to jail”. (Apologies for the odd routing, but there’s a reason for it—honest).

This is a pretty important one for the blogger/citizen journalist movement. A) Can the Feds can force an independent video-blogger to turn over unpublished material, and B) What jurisdiction do the Feds have in a purely local case? (I guess from the rulings on Medical Marijuana we know the answer to that one….) but Silicon Valley Watcher has more on that aspect.

POLICY/TECH: Just a wee bit more on CMS caving to the device guys

Aug 3, 2006• 13

I was going to write some more about the CMS capitulation but over at Health Care Renewal Roy Poses has already said it all. Go and read.

This is why the Enthoven plan for putting private entities (or at least non-lobbyable) entities in the middle is perhaps the solution for the US to avoid the whole system getting even more like defense contracting. If the “plan sponsors” got a flat rate (or PMPM) from the government or price sensitive consumers but still had to deliver a mandated uniform benefits package, then they’d have the incentive to beat up on the suppliers.

It is amazing that Kennedy and Kerry can be bought off by their loyalty to Boston Scientific less than a week after Kerry stumps for universal health care. Perhaps he just can’t make the intellectual connection between the high cost of devices and the un-affordability of health insurance. On the other hand, perhaps this country is just ungovernable. We have seen the future and it is Halliburton.

QUALITY: More from the DM conference

Aug 2, 2006• 2

OFF-TOPIC: The most deserving cause?

Aug 2, 2006• 2

Phil Knight, who has made billions off the backs of teenage workers in Asia making his overpriced Nike shoes, has decided that Stanford Business School is the most deserving cause he can think of, and is giving it $105 million. Stanford University, separate from the business school ,has an endowment of $15 billion. Stanford’s business school, whose graduates are probably the richest elite in the history of the world since Louis XIV’s court, already has an endowment of $700 million and it only has 300 students a year.

Can he really think of no one in the world who needs the money more?

TECH/HOSPITALS: File under CMS, cojones, lack of

Aug 2, 2006• 5

Not exactly a surprise, but when they talk tough about P4P (or anything else) remember that CMS lives in the real world, and where the real power lies.

The federal government on Tuesday softened proposed double-digit cuts in reimbursement to hospitals in 2007 for procedures involving pricey medical devices, a win for medical equipment companies that had lobbied hard against the cuts.

TECH: Imagine

Aug 2, 2006

I have a piece up at Health-IT World called Are We Close to Real Data Integration ‘Redefining Healthcare’? It features a really interesting company called CMTC. Shimon Schurr, the CEO, tells me that they can get to real data extraction and integration from any system in context with all data, today. They’ve done in an online consult service with NY Presbyterian, and are about to launch one in Oncology with Univ of Virgina, Kodak, etc.

I’m not enough of a geek to understand the real difference between CMTC, Teramedica, and the other SOA integration companies, but imagine the possibilities if these guys are correct and we can do real online consults using data that already exists, and share those over the web today? That really does give the possibility that second opinions and therefore national marketing of the genuinely best experts.

At lunch I sat next to someone who used to work at Apollo hospitals, the Indian company that can do top-notch surgery at 1/10th the US price. Imagine getting a consortium consulting on individuals disease from across the world and then moving the procedure to where its best and cheapest.

It wont happen overnight; I’m too much of a pessimist to believe that, but it’s fun to imagine and to see the folks tilting at those windmills and figure out if they might just succeed.

PHYSICIANS/POLICY: Where’s the outrage? by Eric Novack

Aug 2, 2006• 8

Eric Novack is a bitter, twisted physician (just kidding Eric!)in fact he’s outraged! Why? Apparently he wants to be paid on time and doesn’t want to work for free! Read on:

Where is the outrage? Where are the NY Times editorials? The ACLU? In fact, Novack_sm_1

anyone?

On September 22nd, 2006, the government will officially stop sending Medicare payments to physicians. The government has stated categorically that CMS will not be responsible for late charges, interest, or other penalties that could accrue during the payment stoppage. How long will the refusal to pay last? To quote CMS, it will be ‘brief’. It will just last 9 days. Payments will resume on October 2nd, 2006. Read the CMS summary yourself

Why? How could this be? I thought Medicare is the ‘solution’ to our healthcare woes, it just needs some tinkering with more technology and ‘performance incentives’?

The reality is that the much esteemed Medicare system that many THCB aficionados want for everyone is flat broke already. Not in the next 50 years, not for the next generation. Now. In the same way that we think that we will just backdate that check to our landlord, in the same way we just miss one mortgage or car payment by a week or so to wait for the paycheck to register in our account, the government is passing the bill for this year’s Medicare program onto the next year (the beauty of the fiscal year…). Math time: 9/365=2.5% (or 0.0246 for the disbelievers among you) Total Medicare Part B gross estimate (very rough) of $150 billion x 2.5%=$3.75 Billion.

Quite a ‘late check’. Except that the government refuses to pay a late fee. The government says too bad. Perhaps next year the ‘no pay’ period will last 2 weeks? 4 weeks? Perhaps the government will decide to not pay to ‘catch up’ on late payments? It is not a question of if, rather a question of when. Quoting Benjamin Rush at the Constitutional Convention of 1787: “Unless we put medical freedom into the constitution the time will come when medicine will organize into an undercover dictatorship and force people who wish doctors and treatment of their own choice to submit to only what the dictating outfit offers.”

This is a time for courage. The courage of US physicians to remove themselves from the Medicare system as it stands and demand a system that respects the rights of not just the patients of America, but also the providers.

QUALITY/TECH: Disease Management conference in Boston

Aug 1, 2006• 6

Musings from the conference on disease management…..it’s hot in Boston but a few musing from presentations

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Cheap interventions in DM work. Cutting co-pay costs to close to zero and adding pharmacists doing education for chronically ill people in a commercial population makes a big difference. Barry Bunning runs the Asheville project (in North Carolina) which has a ten year history of this and have seen costs for this group go down by about half over that time—with success even in the first years, even though it cost several hundred dollars per patient—and saw continued trend reductions versus comparable national stats. Pretty damn interesting and perhaps we don’t need much more higher tech information.

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Medecision (Henry DePhillips, med director)—started with putting the payers in the business of predictive modeling and matching and is putting that information in the hands of the docs during the physician patient relationship….but claims that only 13–5% of provider data is ready to be assessed, whereas of course none of the personal health record stuff is, and of course all the data has got the payer, and that’s all extractable and electronic. So they can present it in what they call the PBHR (payer-based health record). Their patient clinical summary extracts data from payer systems, summarizes it, and moves it to the doc at point of care. The summary has:

demographic information,
main diagnoses,
a health status measure (derived from the data)
a medical problem list,
then inpatient or ED admissions (with discharge information) in recent years,
useful CPT data from physician visits (including not yet the lab test, but the fact there was a test and who ordered it with their phone number),
the medication list,
doctors already seen
and finally the nursing plan of care content.

Designed for ER docs—most useful is medication list, then docs they’ve seen and phone number, and previous test knowledge. Will be modifying this out. Have already interfaced this into 5 personal health records, to pre-populate. But the main way it’s used is printed out by the triage clerk in the ER or by the front desk clerk in a physician office,.

Just got the results of a financial study (from HealthCore) looking at the use of this in a trauma center over about 9 months (with cases and controls) 918 visits and transmissions. If you take into account the ER episode plus the first day of hospital admission saved $545 per transmission of the record. This showed also NO difference in hospital admit rates. What were the differences? Lab costs much lower; cardiac cath costs much lower as previous; medical and surgical supplies costs lower; physician cognitive care component INCREASED in this population, which probably means that they made the unknown known (i.e. the patient was actually sicker so needed more) . So the payer saved, the doc made slightly more, and the hospital saved on ER throughput time (theoretically can see 9,000 cases more per year, although they make less on each case!)

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I met someone emblematic of the problems of employer based health care. She’s an RN who moved jobs and in the process was financially devastated by first her kids four days in pediatric intensive care after an asthma attack (somehow this was pre-excluded from her employers insurance) and then immediately afterwards her husband needing a by-pass. She was five years from paying off her mortgage with no debt, and now will never be able to retire. Only after the third hospitalization did she realize that the hospital would give them a discount, and of course they charged her the rack rate. She said the worse thing was not knowing about all the potential social support—including from the hospital. This is a straight case of someone working hard, playing by the rules and being totally screwed by the health system.

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Also heard an amazing talk from Dave Moskowitz from GenoMed. Dave has been on THCB before, and he believes that he can reverse disease….and that consequently the entire medical establishment has been shutting him out. Amazing stuff; I of course have no idea if it’s true, but I have a sneaking suspicion that he understands the incentives pretty well!