The Health Care Blog – Page 663 – Everything you always wanted to know about the Health Care system. But were afraid to ask.

Above the Fold

The Perfect Storm For Innovation

Feb 6, 2012• 7

By JOHN HALAMKA

In my career, there have been a few perfect storms, defined as “a confluence, resulting in an event of unusual magnitude”.

When I was an undergraduate at Stanford University in 1980, two geeky guys named Jobs and Wozniak dropped by the Homebrew Computer Club to demonstrate a kit designed in their garage. IBM introduced the Personal Computer and MSDOS 1.0. I purchased an early copy of Microsoft Basic and began creating software in my dorm room including early versions of tax calculation software, an econometric modeling language, and electronic data interchange tools. Every day brought a new opportunity. The energies of hundreds of entrepreneurs created an industry in a few intensely creative months that laid the foundation for the architecture and tools still in use today. A guy named Gates offered me a job and I decided to stay in school instead.

In 2001 when I was first hired at Harvard, a visionary Dean for Medical Education, a supportive Dean of the Medical School, talented new development staff, and a sleepless MD/Phd student came together to create one of the first Learning Management Systems in the country, Mycourses. Robust web technologies, voice recognition, search engines, early mobile devices, and new multi-media streaming standards coincided with resources, strong governance, and a sense of urgency. Magic happened and in a matter of months, an entire platform was created that is still powering the medical school today.

The Journey We Take Alone.

Feb 6, 2012• 4

By Alexander Prisant

You start coming out from under the deep anesthesia. First your eyes start to open. They work. Then you haphazardly try to move an arm, your head, and your lips to speak. And none of that works at all.

You’re strapped in and breathing through a machine and taped up 32 ways against Tuesday. So you go back to your eyes, which work. Mounted over the foot of the bed is a clock. Those big, easy-to-read hospital clocks. You’re a little dopey, but you slowly realize it says three minutes to six. The last time you were conscious, you think, was about 8:45 in the morning.

What??

Now you’re not dopey; you’re stunned and scared and reflexively lurch to get up. But all the medical machinery holding you down keeps you down.

And for some reason there is no pain at all, even though you are already suspecting you’ve been filleted like a flounder.

Does Obamacare Limit Profits for Health Insurance Companies in Your State?

Feb 4, 2012• 84

By Jason Shafrin

One of the provisions in the Patient Protection and Affordable Care Act (a.k.a ACA, a.k.a. Health Reform, a.k.a. Obamacare) is that it limits the profits of health insurance companies. The ACA imposes a minimum medical loss ratio (MLR) on all insurers. The MLR is the amount of money spent on covered person medical care divided by the total revenue received through premiums. There is some debate of what constitutes ‘medical care’ (e.g., do investments in electronic health records count as medical care?), but insurer profits certainly are non-medical.

The ACA requires health insurers in the individual and small group market to spend 80 percent of their premiums (after subtracting taxes and regulatory fees) on medical costs. The corresponding figure for large groups is 85 percent. According to a recent Kaiser tracking poll, 60 percent of the public views the MLR concept favorably, although only 38 percent was aware that the provision is in the ACA. Insurance brokers may be getting squeezed for insurers to meet this amount.

Even though the MLR is a national law, it may not apply in your state. Continue reading…

Do Something Really Innovative In Health: Crowdsource Problems, Not (Just) Solutions

Feb 4, 2012

By David Shaywitz

Businesses exist to solve problems, right? Certainly, this is the heart of the classic entrepreneurial model: you become obsessed with a particular problem, and create a business to solve it. Example: eBay was created by Pierre Omidyar to solve a perceived problem with inefficient markets, and since its inception has generally focused on doing exactly this.

Most enterprises are not blessed by such a coherent focus, at least not for long. More often, organizations – including university research labs as well as for-profit businesses – have a point at which they realize that their challenge has changed, and the problem they thought there were going to solve has shifted or even completely disappeared. The team – often an impressive group of people representing a wide range of capabilities — is then left to figure out what to do.

While disbanding is always an option, it rarely seems to happen, at least volitionally. Businesses, projects, academic enterprises – all are obsessed with their own survival, which rapidly becomes the defining mission. As a result, the organization urgently tries to figure out a way to pivot, a way to apply established resources in a different, useful way as it searches for a purpose to justify its existence. Very often, the question becomes: what should we do – what problem should we solve?

Nimble Medicine

Feb 3, 2012• 9

By Dave Chase

In a piece for the New Yorker, Dr. Atul Gawande outlined how, early in the 1900s, more than forty per cent of household income went to paying for food and food production consumed roughly half the workforce. Beginning in Texas, a wide array of new methods of food production were tested. After many pilots, tests and information dissemination, food now accounts for 8% of household budgets and 2% of the workforce. As a wide array of small innovations ultimately led to the transformation of farming, so too is a rapidly building wave of innovative new care and payment models leading to similar breakthroughs in healthcare. I call this Nimble Medicine.

Until recently, attempting a new care or payment model meant long planning and development cycles. The cost and complexity of testing new models prevented many from being tried. Even today, the leading HealthIT vendor is known to charge $100 million and up for its software. Amazingly, they require three months of training before they even let people administer the software.

Genetic Testing and Insurance: One Datum

Feb 3, 2012• 4

By DAVID FRIEDMAN

Reductions in the cost of genetic testing and improvements in what we know about what it tells us produce obvious benefits; if you know you are likely to have some particular medical problem, you may be able to take precautions against it. But they also have at least one potential downside.

The more is known about the chance of bad things happening to us, the less able we will be to insure against them.

A solution to this problem that is sometimes proposed is to permit individuals to have their genes tested but forbid insurance companies to require testing as a condition of insurance or to use the information it produces. The problem with that is adverse selection. If the customer knows his risk and the insurance company doesn’t, high risk and low risk customers are charged the same price, making insurance a good deal for the former and a bad deal for the latter. Insurance companies, realizing that most of those who choose to buy their insurance are bad risks, will charge accordingly, driving more of the low or average risk customers out of the market. In the limiting case, insurance is bought only by high risk customers, at a high risk price. A famous description of the problem is Akerlof’s article “The Market for Lemons.”

If we allow both insurance companies and their customers to make use of genetic information, then both high risk and low risk customers can buy insurance, but at different prices. The risk of having genetic variants that make you more likely to suffer some expensive medical problem is uninsurable, although you can still insure against the risk that, given those genes, the problem will actually appear.

Thinking About the Bipartisan Policy Center Report on Health IT

Feb 3, 2012

By Jane Sarasohn-Kahn

There are few issue areas within the Beltway of Washington, DC, that have enjoyed more support across the political aisle than health care information technology. In 2004, George Bush asserted that every American would/should have an electronic medical record by 2014. Since then, Democrats and Republicans alike have supported the broad concept of wiring the U.S. health information infrastructure.

With the injection of ARRA stimulus funds earmarked in the HITECH Act to promote health providers’ adoption of electronic health records, we’re now on the road to Americans getting access to their health information electronically. It won’t be all or even most U.S. health citizens by 2014, but it will millions.

Just how solid is political support for health IT these days, then? An important report, Transforming Health Care: The Role of Health IT, from the Bipartisan Policy Center Task Froce on Delivery System Reform and Health IT published in January 2012, talks about the gaps and obstacles to achieving an interoperable, accessible health IT infrastructure.

Care Innovations Summit

Feb 2, 2012• 9

By Kent Bottles, MD

Anyone who is concerned about the future transformation of the United States clinical delivery system should pay attention to the Care Innovations Summit. The selection of presentations as well as the content that was discussed says volumes about where CMS believes payment is headed. Speaker after speaker stated that decreasing the per-capita cost of health care and increasing the quality patients receive is the dominant political, social, and economic issue for all Americans.

Marilyn Tavenner, the new Acting Administrator for the Centers for Medicare and Medicaid Services, outlined what she saw as the major accomplishments of the past few years. Her list included providing partial relief for 3.8 million seniors who hit the prescription drug “doughnut hole,” creating high risk pools for 45,000 Americans, creating a consumer website, allowing young adults to stay on their parents’ health care insurance until age 26, eliminating denial of coverage for patients with pre-existing conditions, eliminating lifetime and annual health care insurance maximums, increasing the coverage of many prevention measures, creating pilots to explore how to base payments on quality not volume, and getting the Innovation Center up and running.

Atul Gawande, MD, the Harvard surgeon and New Yorker author, presented the morning keynote. Gawande, the author of three books on health care (Complications, Better, and The Checklist Manifesto), said the “cost of health care is destroying the American dream.” In Massachusetts the state government sent nearly a billion dollars to local schools to pay for smaller class sizes and better teachers’ pay, but every dollar was diverted to covering higher health care costs. For each dollar added to school budgets, the costs of teacher health benefits consumed $1.40.

Gawande listed three causes of our current health care problem: business interests, government bureaucracy, and the sheer complexity of delivering clinical care in a broken system. He focused on the last of these causes and noted that there are at present 13,600 diagnoses, 4,000 medical procedures, and 6,000 medications. In 1970 the average patient saw two physicians for their medical conditions; today the average patient has more than 15 physicians consulting on their care. He also stated that the health care system “trained and hired physicians to be cowboys, when what we really need are pit crew team members.” He is also hopeful because the health care systems that have the best results are not the most expensive.

It Takes a CEO to Save the U.S. Health-Care System

Feb 2, 2012• 22

By Darrell Moon

Forget Washington and the political debate over Obamacare. The real battle for the future of health care is being fought in the world of business, where tens of thousands of companies have seen their financial well-being undermined by skyrocketing employee health costs.

Although few people realize it, employee health costs have now become the third-largest expenditure for U.S. businesses today, constituting a whopping 8 percent of total compensation. And they are rising fast, more than doubling in just the last decade to more than $15,000 a year for family coverage. Of that cost, 73 percent is paid by the employer.

Yet most chief executive officers are curiously passive, failing to employ even the most basic management tools and market incentives to deal with the problem. Employees and employers alike — but first and foremost the boss — need to be held accountable for reducing the cost burden that is damaging so many companies’ bottom lines.

Here are seven things that CEOs can do:

No. 1: Give incentives to insurance brokers.

Most employers buy their health insurance through brokers who make more money when the plan costs more. Not exactly a smart way to get market forces working in your favor. Better to pay brokers on a fee-for-service basis. Better still to offer them a bonus tied to the amount by which they can reduce a plan’s costs, not a plan’s benefits.

No. 2: Give incentives to your managers.

Every CEO learned in business school that if you want to achieve a key business objective — be it launching a new product or reducing company health costs — you need to provide incentives to managers to help you succeed. Yet rare is the boss who offers bonuses to human-resources and benefits managers who reduce claims costs for the company. It’s long past the time for CEOs to get the incentives working in the right direction inside their companies, as well.