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Health 2.0 EDU: The Shifting Value of Health Care with Kim MacPherson

The health care environment isn’t just changing for digital technology, it is also changing in education for instructors and professionals like Kim MacPherson, the Associate Director of UC Berkeley’s Center for Health Technology. Kim MacPherson will be joining forces with Health 2.0 EDU October 3rd, as part of a three-day executive education course on digital health, where she will share her insights as to how and why this changing environment is important to the value of health care:

EDU: Can you discuss the origins of the shift from volume to value in health care and why this concept is fundamental to the marketplace today?

KM: We have seen multiple attempts over the years to shift away from a volume mentality, but it has been thwarted in the past, in part by the lack of technology and actionable information to support value based efforts. Right now we are seeing an exciting convergence of economic and policy signals, a growing demand to prioritize value by employers and consumers, as well as acceptance by providers that change is inevitable. The focus on outcomes over volume and the new access to timely and more accurate cost and quality data makes the shift to a value focus possible on a larger scale than ever before.

EDU: In what key way is digital technology changing how the marketplace derives economic value in health care?

KM: For me it comes down to engagement, connectivity, and decision support: How to get the right parties meaningfully involved, make sure they have a clear pathway to follow to achieve the desired outcome, and are well supported with actionable information so the entire interaction creates value. This will involve a diverse range of technology including, tele-health, crowd-sourcing, digital diagnostic tools, protocol/pathway tools/simulations, stratification software, and consumer directed applications. We historically have seen a great deal of wasted time and resources when elements of this chain are not in place or are ineffective.  The default to status quo is very easy in health care where there is a high degree of resistance to change by all stakeholders and where outcomes are not easily defined or agreed upon in advance. Digital technology enables change, making new processes and ways of improving health care delivery, financing and patient outcomes finally within reach.

EDU: How have some of the financial and research organizations you have consulted for best used digital technology to improve both outcomes and their bottom line?

KM: Lately I have been most interested in some of the digital technology aimed at consumer engagement; How do we get people involved in both their own health and their health care? Digital technology is being used by health plans and large employers that I work with to both promote wellness through “gaming” style competition applications and web-based technology that allows them to “shop” for the best services. The ability to personalize the experience seems to be a key dimension and a lever to promote real behavior change. Through these applications to digital technology, they hope to shift emphasis and resources toward prevention, improve worker productivity and satisfaction and over time, and see meaningful change in health as well as in their benefit costs.

EDU: How will this Health 2.0 EDU course differ from your usual classes at the UC Berkeley School of Public Health?

KM: In some ways it will be similar as I use a highly interactive format in both environments.  The main difference is that I typically teach classes at Berkeley where digital technology is one facet of the overall course material vs. it being the focus. My areas of specialization involve health care finance, policy interpretation and understanding the incentives that drive a range of stakeholder behavior within health care.  This course offers the chance to go a little deeper into this one key element: examining how some of these core health care areas touch and are impacted by digital technology.

EDU: What are you most looking forward to in your upcoming UC Berkeley course with Health 2.0 EDU, and what do you hope your students will take away?

KM: I am mainly looking forward to engaging with the diverse and dynamic participants. I love the energy and enthusiasm of Berkeley graduate students, but it is also stimulating to have industry professionals in a course, bringing their perspective and more immediate issues into the discussions. I hope that they get some economic and policy context that can stimulate new insights into their work. I also hope that being in an environment that fosters open interaction and exposure to material that may be new or unfamiliar, pushes them outside of their day-to-day roles and thought processes to consider different approaches and ideas to existing challenges.

Registration for the executive course ends September 1, 2013. The full agenda is available HERE.

Beyond the Affordable Care Act: A Framework for Getting Health Care Reform Right

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By Martin Gaynor

The following was drafted quite a few months ago, and had its genesis in a list of recommendations for improving the health care system that David Dranove solicited from a number of academics for an issue of Health Management, Policy and Innovation. I’ve dawdled in finishing and polishing it up, but seeing the stimulating reform proposal posted  recently by Jay Bhattacharya, Amitabh Chandra, Mike Chernew, Dana Goldman, Anupam Jena, Darius Lakdawalla, Anup Malani and Tom Philipson motivated me to return and finish it; so here it is finally.

Introduction

One can hardly say that there’s been too little discussion of health reform recently. However, much of the discussion is focused on the ACA and its details. That’s fine, but we’ve gotten very far away from thinking about overarching principles that we think should guide the design of a health system, and what that implies for what it would look like [1]. What follows are some thoughts on what such a health reform might look like. They are informed by my read of the research evidence, and my observations of the U.S. health care system over a long period of time, but should be understood as representing only my personal opinions.

This is not intended as a criticism of the ACA. While the ACA certainly isn’t perfect, in my opinion we’re better off as a country with it than without it. However, there will be modifications to the ACA and other changes to the health system as we move forward, so having a framework to structure our thinking will be useful as we consider these inevitable changes.

Guiding Principles

What I propose below is guided by the following. First, economic efficiency is a goal. This simply means avoiding waste, i.e, trying to generate the maximum benefits net of costs. The second goal is that no American is exposed to excessive risk to their health or finances due to medical expenses. Last, the overarching design principle is to create basic ground rules for the system and then let the system run, avoiding heavy handed regulation or micro management. The key objective of these ground rules is to give participants the right incentives insofar as possible, while achieving insurance objectives. With that in mind, compassionate, efficient health reform would do the following.

Health Insurance Reform

First, eliminate the tax exclusion of employer sponsored health insurance. The exclusion of employer sponsored health insurance from income taxation distorts the demand for insurance. This leads to people with employer sponsored health insurance holding excessive coverage, which drives up medical spending and thus insurance premiums. Ironically, not taxing health insurance ends up making both health care and health insurance less affordable. Eliminating the tax exclusion of employer sponsored health insurance will eliminate a major distortion in health insurance, health care, and labor markets. It can generate substantial tax revenues (it’s estimated that the value of the state and federal income tax exclusion for 2009 was $260 billion[2]), while potentially allowing for lower income tax rates. It’s also worth pointing out that the subsidy is biggest for those who face the highest marginal tax rates, i.e., it’s regressive.

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A Second Look at the Link Between Obesity and Mortality

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By Lua Wilkinson

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.

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The Strange Case of the C. Everett Koop National Health Award

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By Al Lewis & Vik Khanna

The late Dr. C. Everett Koop was the most revered Surgeon General in history, perhaps even the most revered Cabinet member.  His calling card—indeed, his claim to fame – was his integrity.  A Reagan appointee, he acted as though he reported to no one other than the American people and his own conscience.  His penchant for candor and scientific independence fueled the federal government’s groundbreaking steps to raise public awareness about HIV/AIDS at a time when the tendency was to demonize and diminish.  He resisted incessant political pressure and refused to take positions or produce data that he knew to be false.

This drew strong support from both sides of the aisle, and even his detractors never questioned his honesty.  (Exhibit A:  The two authors of this posting, whose political views have little else in common other than respect for strong, independent-minded politicians.)

Dr. Koop’s legacy stands in sharp contrast to the eponymous award dispensed by The Health Project, whose committee members have turned their back on their founder. The last thing Dr. Koop would have expected is to see is *his* award bestowed upon  people who know that they don’t deserve it.  The 2012 award was given to three recipients for work done in Nebraska:  a vendor that claims wellness programs don’t even have to exist to save money, an outfit that can’t even spell the name of its own founder, and a state employee benefits plan that is under investigation for sky-high administrative costs.

Among the extravagant statements that formed the basis for the award (like claiming more than $20,000 in savings for every person who reduced their risk factors for a year, even though per-person spending is only $6,000), they claimed to have made 514 “life-saving catches” on employees with otherwise undetected cancer.  This data was obviously wrong to begin with — that cancer rate would have been at least 40 times greater than Love Canal’s.  Nonetheless, it sure sounded good, and the Governor of Nebraska himself was all-in too, so an award was issued.

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Aligning Physician Incentives Doesn’t Do It

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By Michael Painter, MD

My wife Mary and I recently got a series of early morning calls alerting us to the declining health of Mary’s mom, who was in her 90s. She died later that week. We were stricken and so sad, but took comfort that she died with dignity and good care on her own terms, and at her home in San Francisco.

Ten years ago, we received a very different early morning call, about my father.  An otherwise healthy and vigorous 72-year-old, Dad had fallen at home. Presuming he’d had a stroke, paramedics took him to a hospital with a neurosurgery speciality rather than to the university trauma center. That decision proved fatal.

A physician in Seattle at the time, I arrived the next day to find Dad in the intensive care unit on a ventilator. Dad’s head CT revealed a massive intracranial hemorrhage. Dad also had a large, obvious contusion on his forehead.

The following day, the physicians asked to remove Dad from the ventilator.  He died that night. We were profoundly devastated by his death and upset with the care he’d received.

Our family wasn’t interested in blame or lawsuits. We did, however, want answers:  Why hadn’t Dad been treated for a traumatic injury from a fall? Shouldn’t he have had timely surgery to relieve pressure from bleeding? What went wrong?

I’ve spent the last decade searching for answers, for myself and countless others, to questions about how to improve health care.  I’ve had the honor of working with many people pushing health care toward high value, at the Robert Wood Johnson Foundation(RWJF) and elsewhere.

We’ve worked hard to find solutions.  We all get it:  The health care problem is a big, complex one without silver bullet answers. Still, we’ve made incredible progress with efforts like RWJF’s Aligning Forces for Quality Initiative in which community alliances work to improve the value of their health care.

We’re searching for ways to help us all make smarter health care decisions.  We’re helping health care professionals improve and patients and families be more proactive.  We’re exploring the price and cost of care, and ways to automate health care information with technology.

And importantly, we’re working to align the incentives that health care professionals need to support and deliver great care.  We strongly believe that unless we reward great results, we won’t get them.  That means payment reform, with a focus on financial incentives for those who hunt for waste, resolve safety problems, sustain improvement, and, most of all, innovate to save more lives.

But do financial incentives to promote and reward behavior work?

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Why Reports of the Death of Physician Participation in Medicare May Be Greatly Exaggerated

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By Dan Diamond

“Half of primary care physicians in survey would leave medicine … if they had an alternative.” — CNN, November 2008

“Doctors are increasingly leaving the Medicare program given its unpredictable funding.” — Forbes, January 2013

Doctors, it seems, love medicine so much … that they’re always threatening to quit.

In some cases, it’s all in how the question is asked. (Because of methodology, several eye-catching surveys have since been discredited.)

But physicians’ mounting frustration is a very real problem, one that gets to the heart of how health care is delivered and paid for. Is the Affordable Care Act helping or hurting? The evidence is mixed.

Doctors’ Thoughts on Medicare: Not as Dire as Originally Reported

The Wall Street Journal last month portrayed physician unhappiness with Medicare as a burning issue, with a cover story that detailed why many more doctors are opting out of the program.

And yes, the number of doctors saying no to Medicare has proportionately risen quite a bit — from 3,700 doctors in 2009 to 9,539 in 2012. (And in some cases, Obamacare has been a convenient scapegoat.)

But that’s only part of the story.

What the Journal didn’t report is that, per CMS, the number of physicians who agreed to accept Medicare patients continues to grow year-over-year, from 705,568 in 2012 to 735,041 in 2013.

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Criminal Charges for Providers Won’t Fix the NHS, Dr. Berwick

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By John Tingle

One of US President Barack Obama’s key health advisers has just published a review in the aftermath of the Mid Staffordshire hospital scandal. Don Berwick’s review is both thoughtful and reflective but one of his key recommendations – to create criminal sanctions against health staff – will not make the NHS safer for patients.

Many patients, particularly elderly ones, suffered unnecessary indignities and avoidable harm at Mid Staffordshire.

The Francis report into the crisis concluded that patients were routinely neglected by a health trust more preoccupied with cutting costs and meeting targets rather than its responsibility to provide safe care. Patients’ calls for help to use the bathroom were ignored and some were left lying in soiled sheeting or sitting on commodes for hours. Events and failings there will probably go down in history as the blackest and bleakest moment for the NHS.

When the report was published in February, the government committed to appointing a advisory group of patients to consider the various accounts of what happened and the recommendations made by Robert Francis and others. The idea was that they would distill for the government and the NHS what lessons should be learned and what changes needed to be made.

Don Berwick, who worked on the long fought for Obamacare provisions in the US, is director and co-founder of the Institute for Healthcare Improvement in Boston. He was called in by the government to reflect on the Francis report and on patient safety.

Berwick’s review makes ten recommendations including that sufficient staff are available to meet the NHS’s needs now and in the future – staff should be well-supported and able to ensure safe care at all times; quality and safety sciences and practices should be a part of the initial preparation and lifelong education of all health care professionals, including managers and executives; and leaders should create and support learning and subsequently change, at scale, within the NHS.

But most controversial is his final recommendation:

We support responsive regulation of organizations, with a hierarchy of responses. Recourse to criminal sanctions should be extremely rare, and should function primarily as a deterrent to willful or reckless neglect or mistreatment.

Berwick proposes the government creates a new general offence of “willful or reckless neglect”, applicable both to organisations and individuals. Organizational sanctions might involve removing leaders and disqualifying them from future leadership roles, public reprimand of the organization and, in extreme cases, financial sanctions – but only where that will not compromise patient care.

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Nokia Sensing XCHALLENGE Finalists at Health 2.0

By Matthew Holt

Today XPRIZE announced the 12 finalists for the Nokia Sensing XCHALLENGE. This is a $2.25m prize competition to advance the ability to use sensors to measure and manage health, and it’s something that we’re fascinated by at Health 2.0.

We’re even more thrilled to tell you that on October 2nd the winners will be unveiled live on stage at Health 2.0’s Fall Conference by our friends at XPRIZE and Nokia, the XChALLENGE’s sponsor. The 12 finalists come from the US, Israel, Japan and the UK and run the gamut in new diagnostic tools. Details below the fold, but this is going to change how we measure health–not to mention it’ll also be lots of fun!

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Develop a Strategic Initiative with UC Berkeley’s Steven Weber and Health 2.0 EDU

Technology is changing at a rapid pace, so what does this mean for those developing business strategies attempting to keep ahead of the curve?

Steven Weber PhD, Professor at Berkeley Haas School of Business, will put your mind at ease in his joint class with Heath 2.0 EDU this October. His years of expertise with national and international security strategy will provide health care executives the foundation and insights they need for the future of digital health.

EDU: Your background is in international and national security. What are the parallels between security and health care? How does security factor into how an organization implements new innovations?

SW: My work in national and international security has always focused on strategic interaction — how the agendas and actions of one country modify the landscape of choices for another country.  It’s a historical pattern, almost a constant, that national leaders have a very difficult time understanding these strategic responses because they find it almost impossible to see the trade-offs that they impose on others, from the other’s perspective.  And since strategy is almost always about modulating trade-offs, the most important thing a great strategist can do is to change the trade-off calculation for other players in the environment.  My guiding principle is simply this: “make it as easy as possible, for the ‘other guy’ to do what would most benefit you.” Putting that simple notion into practice is the hardest and most important ingredient of innovative strategy.

EDU: You have also consulted for numerous public, private, and international organizations: how are they each using digital technology to foster innovation?

SW: Innovation means many different things to different people.  When I say ‘innovation’, I mean the use of ideas, both new and recombinant, in the service of creating new value.  Digital technology can obviously be a major driver of innovation because digital is very good at encoding ideas [rather than throwing] new resources at an old problem. But I think the most important contribution of digital technology to the innovation agenda is in creating transparency within organizations. The kind of transparency that matters? Exposing dead conventions, old and encrusted ways of doing things that have been around so long that no one puts a question mark over them anymore.

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A Health Plan for Rugged Individualists

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By Uwe Reinhardt

In his “The Great American Health Care Divide,” Brad DeLong laments the great ideological divide that has so long prevented this great country from developing a coherent national health policy.

I am glad to have Brad’s company, because I have whined about the same divide for several decades now, as evidenced by my “Turning Our Gaze from Bread and Circus Games,” penned in 1995 and “Is there hope for the uninsured?”

Finally, after a nice visit with my friends at the Cato Institute and reading the often amazing commentary on John Goodman’s NCPA blog , I was moved to pen a post on The New York Times blog Economix entitled “Social Solidarity vs. Rugged Individualism.” It was inspired by the often hysterical description of the Affordable Care Act (ACA) as a government takeover of U.S. health care or a trampling on the freedom of Americans, as in mandating individuals to have minimally adequate health insurance, lest they become freeloaders on the system.

The basic idea of my proposal is simple.

In 2009, Paul Starr had warned Democrats of a potential voter backlash against the individual mandate and proposed instead a nudging arrangement. Uninsured Americans would be auto-enrolled into health plan, if they chose not to select one, but could opt out of it with the proviso that for the next five years they could then not buy insurance through the insurance exchanges established by the ACA at community-rated premiums, and potentially with federal subsidies.

My proposal is to make that a lifetime exclusion. An individual would have to choose one or the other system by age 25. Should individuals opting out fall seriously ill and not have the means to pay for their care, we would not let them die, of course, but to the extent possible we would cover their full bill – possibly at charges — by expropriating any assets they might have and garnishing any income above the federal poverty level they subsequently might earn. Something like that.

As Jay Gaskill’s somewhat opaque reaction in “RUGGED INDIVIDUALLISM is NOT the Essential Value of Freedom” suggests, people who oppose the ACA as trampling on their freedom are not comfortable with my prescription, which does not at all surprise me.

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