Health Care Policy, Innovation and Renewal is a pretty interesting new blog from a hopsital system strategy exec, who appears to have something of a social conscience—if that’s not a contradiction in terms! Doesn’t seem to be updated all that often but every post I read is thought provoking (wish that I could say that for THCB!). It’ll be interesting to see its development
Apparently the SEC is understood to be examining suspicious option trades in the run-up to the HCA leveraged buyout. Which does give me the thought, can’t Bill Frist leave well enough alone?
Change of Shift, the nurses compendium is up.
If you’ve tried to sign up for the THCB Update email at any point in the past two or three days you may have encountered problems. THCB’s intrepid techies are working to resolve matters. Meanwhile, If you’d like to sign up, drop us an email at th******@***il.com.
The biggest P4P scheme in the world is going on in the UK, one that I first wrote about in early 2004. (For more on the wider ramifications of reform in the UK ,see yet another article in this weeks NEJM)
Note that all the GPs there have computers, so they can easily report their process behaviors. Note also that the introduction of the system as done as a way of giving extra cash to GPs, but extra cash for improving quality of primary care process. So the first year’s results are in, and the GPs have done much better than was predicted and better than most American groups studied other than the VA. I think this is so important in the light of where Medcare is going that I’m including the entire discussion section from the NEJM article from the Univ of Manchester group that studied it. It’s called “Pay-for-Performance Programs in Family Practices in the United Kingdom”, and its below the jump, as an exceprt from an article by Arnold Epstein commenting on its implications for the US
*******
More on the incredible United Healthcare/Golden Rule story that Joe Paduda’s been following. Joe’s latest is called Who is UHC’s customer?
Essentially United’ high deductible subsidiary Golden Rule is advertising that it’s selling a HDHP with agreed procedure rates for customers—just like the vast majority of PPOs out there. But when the time comes, they are contractually allowing their providers to balance bill the customer over and above the rates they’ve agreed. The real kicker is that are keeping that fact secret from their customers because—absolutely incredibly—they claim it’s a trade secret between plan and provider. So they tell the customer that they’re buying into a network with pre-negotiated rates, but it’s not true. This is pretty much straight fraud.
Sadly, Golden Rule has been a scumbag organization since day 1. It was started by Patrick “looney” Rooney and its goal has been to change the law so that it can sell more of its highly underwritten, high margin HDHP policies. After numerous contributions to certain Republicans, who lets face it couldn’t give a rat’s arse about the poor consumer despite all their high fallutin rhetoric about 21st century health care, the HSA is now the law of the land and plans like Golden Rule (as well as one hopes somewhat more ethical ones) are very hot.
So hot that managed care companies decided (as I’ve said before) that acquisition rather than imitation is the sincerest form of flattery. UnitedHealth Corporation bought Golden Rule for $500m in 2003 when the HSA law was passed. Rooney meanwhile moved onto better things like buying basically reverse racist anti-Kerry commercials on black radio stations in the run-up to the 2004 election.
In a Businessweek article last year United said that it had cleaned up Golden Rule’s scummier practices:
Soaring demand is one reason why UnitedHealth paid $500 million in 2003 for Golden Rule, of Lawrenceville, Ill., problems and all. Since 1995, Golden Rule has faced 15 investigations by insurance officials for aggressive sales tactics and questionable marketing. That compares with just nine investigations at UnitedHealth, though Golden Rule’s revenues barely equaled 3% of UnitedHealth’s 2003 revenues. At its low point, in 2002, Golden Rule settled for $660,000 a nine-state investigation that found its small-group policies required employees to submit "proof of good health," a violation of federal health-care rules. In addition to the payment, Golden Rule agreed to make "substantive" changes in the way it does business in those states.Since taking over Golden Rule, UnitedHealth has made further strides. Complaints against the outfit have dropped by more than half. And as UnitedHealth expands Golden Rule, it is encouraging consumers to check health-care costs via its online "treatment cost estimator" so they aren’t surprised by big out-of-pocket bills. "When we acquire a company, we take responsibility for all their past conduct," says Mark F. Lindsay, UnitedHealth’s vice-president for communications and strategy.
Apparently you have to now actually have the double secret “treatment cost estimator” which tells you what your balance billing exposure is on top of the secret negotiated rate
All of which goes to show that you can take these trash plans out of the trailer park — into the big respectable corporation — but you can’t take the trailer park trash out of the plan. (With apologies to THCB readers who live in trailers). And of course the problems they bring with them may just spread over to the rest of the organization—which since 2004 seems to be back-sliding on its “be nice to providers” mantra with nasty little episodes in Arizona and New York.
Then again given the charges filed against Brocade’s CEO for backdating stock options and the virtual certainty that after their screwing around with the dating of option awards they are next on the SEC/DOJ hit list, it may just be that instead of sorting out this mess United’s senior management has got, ahem, other things on its mind.
Two things have got my attention recently. The first is the concept of the long tail in medicine, which I’ve thought about alot since my fiancee got an odd condition (shortness of breath) that didn’t match any of the symptoms the text books said were the symptoms of the usual shortness of breath. She endured several doctors diagnoses of diseases that went from the wrong to the ridiculous (panic attacks that lasted for weeks?). After much, much digging around on the web she found a patient testimonial from someone who had long term shortness of breath and related it to caffeine. Yup, drinking coffee was causing the problem. But because it was a rare symptom of what’s not normally a medical problem she had to go through the annoyance (and worry) of being wrongly diagnosed and put on drugs she didn’t need, and now she can’t drink coffee or eat chocolate—her life must barely be worth living!
The second is a plethora of people writing to me telling me about XYZ product that is the greatest since sliced bread and would I please praise it on THCB. One such person is Jim Walker from new physician social networking site MyMedwork. Usually when I request that said person writes a piece putting their service in context I get self-serving marketing jargon, and when I request that they instead really write a general interest piece I never hear from them again. In contrast Jim wrote an excellent explanation of the Long Tail in health care. Here it is:
Healthcare and The Long Tail
My neighbor brought her son to the doctor this summer for a rash that
wouldn’t go away. “The doctor had never seen anything like it,” she
explained. “In fact, he brought in the other doctors to take a look at
it, and none of them had ever seen it either.” Now I don’t know about
you, but listening to her reminded me of my worst medical nightmare of
things I don’t ever want to hear from my doctor: “Excuse me, do you
mind if I bring in some of the residents? We’ve never seen a case like
yours before.”
In a recent THCB post,
author Maggie Mahar writes that “Ambiguity haunts medical care”. She
goes on to quote Dr. Atul Gawand – “Uncertainty is the core predicament
of medicine . . . the thing that makes being a patient so wrenching,
being a doctor so difficult and being part of a society that pays the
bills so wrenching."
It’s important to note that for a great
many cases, ambiguity is not really an issue. This is because the
distribution of medical ailments follows a curve very similar to Chris
Anderson’s “Long Tail”,
with a great many common “blockbuster” ailments stacked up high on the
left-hand side of the curve. For those not familiar with the Long Tail,
Anderson describes how Amazon, Netflix, and other online retailers sell
lots of the usual blockbusters, but actually derive more total volume
from 100s of thousands of niche products. In healthcare, it is the
left side of this distribution curve which inspires (for better or
worse) Wal-Mart, Target, and others to offer “Doc In A Box” services –
Allergies, Bladder Infections, Bronchitis, Ear Infections, Pink Eye,
Sinus Infections, and a full battery of vaccines – all served up for a
fixed price while you wait.
On the right hand end of the
curve though, the NIH Office of Rare Disease classifies over 6,000
conditions, each afflicting fewer than 200,000 Americans. Along this
part of the curve, things do indeed get very ambiguous in a hurry –
both for patients and physicians. Specialization is a response to this
range of ailments (“nichefication” in Anderson’s terms), and brings
physicians repeated cases of a particular nature – giving them the
confidence that they can routinely diagnose and treat a high percentage
of these patients. However, even within a particular specialty area,
cases will naturally follow a distribution curve from typical to
atypical. Unto themselves – atypical cases are just that – one of a
kind aberrations that force physicians to go outside their typical
“comfort zone” of diagnosis and treatment. For each individual
physician, these atypical cases feel like the exception rather than the
rule. What the Long Tail suggests though, is that taken in their
entirety, these rare cases actually compromise a large percentage of
all medical cases. In fact, over 25 million Americans suffer from a
“rare” condition.
This is problematic, because in general,
physicians – and the healthcare system as a whole – are not well
prepared for dealing with the many and inevitable rare cases. In fact, statistics show
that the median time to diagnosis of a rare condition is six months,
and the average is almost three years! When faced with an atypical
case, most physicians will begin to consult the literature, and/or
confer with their colleagues. Ironically, it is at this moment that the
Long Tail shows up again in a quite surprising and often detrimental
fashion. This is because recent studies in social and information
analysis reveal that our network of professional contacts and
information sources follows the same type of distribution curve. In
other words – we all generally tend to connect with the same 15 or 20
trusted colleagues on a regular basis, and we all gather our
information from a limited stream of trusted sources. Beyond this
trusted core lies an entire world of other people and sources we rarely
connect with, if at all – our own social and information “long tail”.
Generally, using a network of trusted sources (while tuning out most
everything else) is actually very efficient at handling a majority of
our day to day needs. For the atypical situation though, just when we
really need to break out of our habitual way of doing things – our
trusted sources generally don’t deliver. They’ve all been drinking from
the same information punch bowl.
So, we have to head out to
the right-hand side of the curve – and begin finding and evaluating
people and sources we don’t really know. For a student or researcher,
this type of research can become a time consuming, challenging, but
often rewarding journey. But, for a patient and physician confronted
with a puzzling and life threatening illness, the stakes are much
higher and time is at a premium. In today’s system, the physician often
must address this dilemma by referring the patient to some other
specialist – with the hope that maybe they will have the knowledge or
connections to form a proper diagnosis and treatment protocol in a
timely manner. The patient of course, must continue to move from
specialist to specialist, their rare case still in hand.
Not
surprisingly, the Internet has proved both boon and bane in this
situation. Patients and their families are using the Web to dig into
the latest medical research. However, matching a worried patient or
family member against 1,706,532 Google results is usually a
prescription for both confusion and high blood pressure.
On
a more encouraging note, patients stuck along the right-side of the
curve with a “niche disease” are using the extraordinary reach of the
Web to discover that they are not so atypical after all. It’s probably
no surprise to THCB readers that patients are banding together around
wikis, chat rooms, blogs and social networks to offer each other
information, empathy, and inspiration. (This is not so different in
network theory terms from when fans of a niche band find each other on
MySpace). Some of these disease state patient networks are sponsored by pharma marketing, while others are grass-roots efforts, usually led by a parent or family member related to one of the patients.
Physicians
are also turning online in large numbers. Manhattan Research reports
that more than 600,000 physicians are using search engines to find
medical information. Are they searching about how to treat their
day-to-day typical cases? Very unlikely. Chances are, they are
researching an atypical case. However, if two physicians search – for
example, on “phylloides tumors” at Google they each receive the same
list – but have no easy context by which to evaluate the 13,600 +
search results!
Social network software may be one way to
help physicians overcome this “search result overload”, allowing them
to move faster and more confidently outside their circle of trusted
sources and down the long tail, especially when faced with a “rare”
condition (which as we’ve noted – is not such a rare occurrence in the
aggregate). For example, within MyMedwork
, search priorities start with the individual physician’s network of
trusted colleagues and work outward from there. In other words – each
physician gets a totally unique list of search results based on who in
their own extended network is likely to possess useful information.
Because the medical community is so small, it turns out that physicians
are usually quite closely linked to any given article or study, they
are just not aware of the connection. By viewing the social network
connection within their search results – they are then in a position to
more accurately judge the quality of the information – either by
checking with the in-between link (i.e. “Hi Dr. Jones, I notice you’re
connected to Dr. Watson – what do you think of his study on phylloides
tumors?”) – or by contacting the physician directly (i.e. “Hi Dr.
Watson, I see you went to medical school with my colleague Dr. Jones,
do you mind if I ask you a few questions about your study?).
The
implications of The Long Tail and social network analysis for
healthcare are just beginning to be explored and understood. It is
already clear though, that as the entire healthcare field continues to
undergo dramatic change, and “atypical” rare disease states become ever
more typical, ambiguity and uncertainty will continue to impact medical
decision making. In this environment, the need to develop richer and
more varied sources of information, and the value of far-reaching,
online social trust networks will become increasingly apparent for
patients and healthcare practitioners alike.
YOU’VE GOT MAIL
Or we’ve got mail. Or we’ve all got mail. Or something …
After much late night heroism by THCB’s trusty (and highly
sensitive) tech staff, the THCB email list is up and running. If you’d
like to get a quick email in your inbox with a rundown of new posts –
with news flashes for important stories – you can sign up here.
If you subscribed to the list in its earlier incarnation, there’s no need to do so again.
Vanessa Furhman continues her swath through the PBM industry in the WSJ. The article is called Managers of Drug Benefits Agree To More Transparency in Pricing. Apparently bullied into this by fear of losing some big clients, both Medco and Caremark are going to disclose their prescription pricing.
Responding to pressure from some of their biggest corporate clients, two big pharmacy benefit managers agreed to provide more information to employers about the way they price and administer employee drug purchases. The two PBMs, Medco Health Solutions Inc. and Caremark Rx Inc., each handles the drug benefits for tens of millions of Americans. They have agreed to participate with eight smaller PBMs in a purchasing model that would require them to pass on to clients their own costs for acquiring retail and mail-order prescriptions. They also have agreed to pass along the price rebates, rarely disclosed in the past, that they receive from drug manufacturers.
Well actually Medco was making its total rebates clear and has begun passing back to its clients a significant chunk of its rebates last year, but its profits increased anyway because it made it up on the spread on mail-order generics. So will they start disclosing what they pay for those versus what they charge? Unclear:
Medco and Caremark both started the coalition’s process to become certified when it launched last year, but dropped out along the way. A big sticking point for them, according to some people working with the coalition, was the demand for full transparency and acquisition-cost pricing on generics ordered through the mail. PBMs enjoy some of their steepest markups and profits on mail-order generic drugs.
It’s not evident that they will be doing this, although smarter employers can find out market generic prices, see what they’re paying and figure out the difference. Something not many have bothered to do–to their great cost.
But if they succeed in beating the PBMs up on rebates and on generic spreads, the enormous profitability of the PBMs (Yup, it is enormous—around 50% net margins if you don’t look at the cost of the drugs which are mostly a pass thru) can’t continue. So does Wall Street believe the end is nigh?
Judging by the change in their stock price, not exactly.
INFORMATION THERAPY (Ix) is transforming health care. Join us in Park City UT for the Fifth Annual Ix Conference, "Catalysts for Innovation"Sept 25-27, 2006. To register or for agenda details go to:http://www.ixcenter.org/2006conference/index.cfm
DISEASE MANAGEMENT BOSTON At a three day conference in Boston MA, scheduled between July 31 and Aug 2, industry leaders from managed care companies, employer groups purchasing healthcare services, providers, third party administrators, physicians, healthcare technology players, nursing and pharmacy practitioners, disease management experts will meet at the 4th Annual Disease Management Conference. The event is posted online at www.srinstitute.com/ch142. Learn about advertising on THCB
JSK is up on iHealthbeat about Health IT After the Employer-Sponsored Health Era.
Go read.
From THCB’s New York Desk … A defense fund has been set up to help cover legal expenses
for Dr. Anna Pou and the two nurses charged with murder by Louisiana attorney
general Charles Foti in the Memorial Medical Center case last week. Contributions should be
mailed to:
Dr. Daniel Nuss, MD
Professor and Chairman
LSU Dept. Of Otolaryngology
533 Bolivar St, 5th Floor ENT Suite New Orleans, LA 70112
THCB's Podcasts
Listen to them on Itunes or Spotify
