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Can CMS’ Proposed ACO Changes Really Help Medicare Beneficiaries?

By REBECCA FOGG

Earlier this month, the Centers for Medicare and Medicaid Services Administrator Seema Verma proposed bold changes to Medicare’s Accountable Care Organizations (ACOs), with the goal of accelerating America’s progress toward a value-based healthcare system—that is, one in which providers are paid for the quality and cost-effectiveness of care delivered, rather than volume delivered.

CMS has created a number of ACO programs over the last six years in an effort to improve care quality and reduce care costs across its Fee-for-Service Medicare population. In a Medicare ACO, hospital systems, physician practices and other voluntarily band together and assume responsibility for the quality and cost of care for beneficiaries assigned to them by Medicare. All ACOs meeting quality targets at the end of a given year receive a share of any savings generated relative to a predetermined cost benchmark; and depending on the type of ACO, some incur a financial penalty if they exceed the benchmark.

According to CMS’ recent analyses, ACOs that take on higher financial risk are more successful in improving quality and reducing costs over time. So one important objective of CMS’ proposed changes is to increase the rate at which ACOs assume financial risk for their beneficiaries’ care.

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How My iPhone Prevented an ER Visit

It’s one of those calls you never want to get as an electrophysiologist:

“Doc, I got four shocks from my device yesterday.”

“What were you doing at the time?”

“Working outside.”

“Wasn’t it about a 100 degrees and humid then?”

“Yes.”

“Were you lightheaded before the event?”

“Not too bad… I stopped what I was doing and got better. Should I come in to the ER?”

“This happened yesterday?”

“Yes.”

“Why didn’t you come in then?”

“Well I started to feel better…”

“Do you know how to upload the information from your device at home?”

“You mean using that thing next to my bed?”

“Yes.”

“I think so.”

“Okay, why don’t you go do this and we’ll call you right back after we have a chance to view the information you send us.”

“Okay. Thanks, doctor.”

So I waited about 15-20 minutes, then checked the Medtronic Carelink app on my iPhone.

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Grassley Criticizes Removal of Doctor Discipline Data

U.S. Sen. Charles Grassley (R-Iowa) sent a letter today to the Health Resources and Services Administration, criticizing its decision to remove a public version of the National Practitioner Data Bank, which has helped reporters and researchers to expose serious gaps in the oversight of physicians.

“Shutting down public access to the data bank undermines the critical mission of identifying inefficiencies within our health care system – particularly at the expense of Medicare and Medicaid beneficiaries,” Grassley wrote to HRSA Administrator Mary Wakefield. “More transparency serves the public interest.”

Grassley, ranking Republican on the Senate Judiciary Committee, continued: “Generally speaking, except in cases of national security, the public’s business ought to be public. Providers receive billions of dollars in state and federal tax dollars to serve Medicare and Medicaid beneficiaries. Accountability requires tracking how the money is spent.”

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Price Tags and Haggling in an Exotic Market

A friend of mine recently took an exotic trip. While shopping in a market, she picked up an appealing item and asked the seller what it cost. She was given a price that seemed high, and paused to consider whether the impulse seemed justified. The shopkeeper grew confused in the silence. Finally he asked my friend, “Don’t you want to know if I can do better?”

Clearly this person was outside of her bargaining comfort zone. Many – perhaps most – Americans are accustomed to paying the price as written on a tag. If you have to ask, you can’t afford it, or so I was told growing up in suburban shopping malls.

American consumers make the same assumptions as they search for transparency in health care costs. Obviously there are charges for these services – they are clearly written on the bills after the services are delivered. So why is it so hard to find out the cost of a service before it is performed? Here it is essential for the customer to understand that the charge and the price paid may be quite different; in fact, they are expected to be different. The health care consumer is not shopping in a chain store whose clerks forgot to stamp the items with their prices. On the contrary, the confused shopper has stumbled into an exotic market without a clue on how to haggle.

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Essential Health Benefits: Balancing Costs, Coverage, And Necessity

The much anticipated Institute of Medicine Report on essential health benefits (EHB) was released last week with a series of recommendations that answered some questions and raised many more. The report offers a very important opportunity for researchers, policymakers, providers and patients to fill in some of the white space between the recommendations.

Background on EHB in the Affordable Care Act and some Legislative History

The Affordable Care Act (ACA) tasked the IOM to make recommendations on the methods for determining and updating the essential health benefits that must be offered by qualified health plans seeking to participate in exchanges as defined in section 1301 of the statute. The ACA identified ten categories of items and services that must be included in a package of benefits:

  • Ambulatory patient services
  • Emergency services
  • Hospitalization
  • Maternity and newborn care
  • Mental health and substance use disorder services, including behavioral health treatment
  • Prescription drugs
  • Rehabilitative and habilitative services and devices
  • Laboratory services
  • Preventive and wellness services and chronic disease management
  • Pediatric services, including oral and vision care

The Affordable Care Act did not have a conference committee report, which is the product of the House and Senate working to resolve differences between the two chambers’ versions and also helps to highlight legislative intent. So the long history of the decisions behind the language and legislative intent is not as apparent.  Briefly, Congress looked at many design models and previous bills, such as HR 3600 — one of the health reform bills put forward during the Clinton administration — which contained 61 pages of details on benefits. This approach was was felt to be too detailed and prescriptive.  Staff from Senator Kennedy’s Health, Education, Labor and Pensions Committtee used the Massachusetts language on exchange benefits and its promulgated regulations and then made important additions such as habilitative services (educational or long term services, often associated with long terms disabilities or conditions such as autism).

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Obamacare HHS rule would give government everybody’s health records

It’s been said a thousand times: Congress had to pass President Obama’s  health care law in order to find out what’s in it. But, despite the repetitiveness, the level of shock from each new discovery never seems to recede.

This time, America is learning about the federal government’s plan to collect and aggregate confidential patient records for every one of us.

In a proposed rule from Secretary Kathleen Sebelius and the Department of Health and Human Services (HHS), the federal government is demanding insurance companies submit detailed health care information about their patients.

(See Proposed Rule:  Patient Protection and Affordable Care Act; Standards Related to Reinsurance, Risk Corridors and Risk Adjustment, Volume 76, page 41930. Proposed rule docket ID is HHS-OS-2011-0022 http://www.gpo.gov/fdsys/pkg/FR-2011-07-15/pdf/2011-17609.pdf)

The HHS has proposed the federal government pursue one of three paths to obtain this sensitive information: A “centralized approach” wherein insurers’ data go directly to Washington; an “intermediate state-level approach” in which insurers give the information to the 50 states; or a “distributed approach” in which health insurance companies crunch the numbers according to federal bureaucrat edict.

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Suit Says Test Labs Cheat Medicare, Medicaid

Despite recent court settlements that recouped more than a quarter billion dollars from lab-test companies for allegedly overbilling California’s Medicaid program, the federal government seems to be ignoring similar schemes that drain Medicare coffers.

The cases involve the nation’s two largest medical laboratory-testing companies – Laboratory Corporation of America and Quest Diagnostics – that together control about half the annual $25 billion lab test market. The Medicare suits, filed in federal court in Manhattan by a former industry executive, claim the testing companies charged insurers like UnitedHealthcare unprofitably low rates while squeezing Medicare and Medicaid.

The whistleblower suits allege the schemes relied on sweetheart deals in which managed-care companies required in-network physicians to send their patients’ lab tests to a single testing company. As part of the deal for below-cost prices, the insurance companies allegedly promised to encourage physicians in their networks also to send Medicare and Medicaid patients to the same testing company, which then billed the Centers for Medicare and Medicaid Services (the federal agency that oversees both programs) or state Medicaid agencies at significantly higher rates.

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Do Computers Really Come Between Doctors and Patients?

One of my favorite movies is Back to the Future starring Michael J. Fox.  I must admit after reading this New York Times piece, titled “When Computers Come Between Doctors and Patients” I have to wonder.

Am I fortunate to be coming from the future?  Because I completely disagree with Dr. Danielle Ofri, again.

I’ve had the privilege and opportunity to work in a medical group which has deployed the world’s largest civilian electronic medical record and have been using it since the spring of 2006.  I don’t see the issue quite as much as Dr. Ofri did.  It is possible that she examined patients in her office with a desk rather than an examination room.

If placed and mounted correctly in the exam room, the computer actually is an asset and can improve the doctor patient relationship. It is part of the office visit. The flat screen monitor can be rotated to begin a meaningful dialogue between the patient and I. We review the lab work together as well as the trends. Look at xrays. Who needs anatomy flip charts when I can Google any image instantly? Patient friendly information to reinforce our discussion is a click away.

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Leaders Of Science-Driven Businesses Should Understand … Science

Even as a med student, I was struck by the discrepancy between how much the junior doctors (particularly the interns and second-year residents) seemed to know, and how much the more experienced doctors knew: with few exceptions, the junior doctors seemed to know a lot more.  Or at least, they would always have a definitive answer at their fingertips.  Such was their apparent understanding of human pathophysiology that they were usually able to offer plausible, immediate explanations of anything, make a rapid assessment, and move on.

In contrast, the expert physicians – the doctors who had spent decades of their lives treating particular types of patients, and studying a specific disease – tended to be far less definitive, and much more likely to say, “to tell you the truth, we really don’t know.”  If a patient responded in a certain way to a new treatment, the experienced doctor is more likely to say “well, that happens sometimes,” while the second-year resident would more likely say, “of course we expect that, it’s because …”

I did most of my clinical training after completing my PhD, which focused on the relationship between several proteins involved in intracellular transport, and I was struck by how difficult it was to define with precision how a handful of proteins interacted, even when I was able to study these proteins essentially in isolation in a test-tube – an extremely reduced system.  It was a struggle to say with certainty exactly what was going on (though the results – here, for instance – seem durable, at least to this point).

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Pay-for-Performance Attacks Hospitals


This blog has tried to support the virtue of personal responsibility. If you smoke, don’t blame Joe Camel. If you surrender to Big Mac attacks, don’t go after Ronald McDonald. If you love donuts, and your girth is steadily expanding, is it really Krispy Kreme’s fault? And, if you suffer an adverse medical outcome, then…

Medicare aims to zoom in on hospitals, suffocating them with a variation of the absurd pay-for-performance charade that will soon torture practicing physicians. Of course, a little torture is okay, as our government contends, but pay-for-performance won’t increase medical quality, at least as it currently exists. It can be defended as a job creator as several new layers in the medical bureaucracy will be needed to collect and track medical data of questionable value.

Medical quality simply cannot be easily and reliably measured as one can do with a diamond, an athlete or a wine. Most professions resist being graded or claim that the grading scheme is a scheme. Teachers, for example, refute that testing kids is a fair means to measure their teaching performance. Conversely, any individual or profession who scores well on any quality review program will applaud the system’s worth and fairness. Shocking.

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