The Health Care Blog – Page 693 – Everything you always wanted to know about the Health Care system. But were afraid to ask.

Above the Fold

Decentralization and Mining Geodata: Thoughts from Health 2.0

Oct 3, 2011• 18

By JOE FLOWER

People have been talking for decades about decentralizing much of healthcare away from massive Big Bricks on the Hill — for lots of good, sound reasons revolving around the efficacy of convenient primary care and home care, and the improvement in communications. It hasn’t happened much because these are all “should” reasons, not “have you by the throat” reasons.

The HYBTT reason is arriving: In the approaching liquefaction of healthcare, provider organizations (today’s institutions or others that will arise to compete with them) increasingly will be identifying particular populations in their service area whose primary care (or chronic conditions) they can manage under risk contracts. They will be doing this so that they can give these people earlier, smarter, resource rich care, and profit from driving the cost of care down and the effectiveness up. To serve these populations, providers will locate wherever is most convenient to that population, because especially in chronic and primary care, convenience is clinical. It makes a big difference if the people you are serving can get care downstairs, down the hall, or down the block, instead of across town, down the freeway, at the end of three bus transfers. So we will see a lot of “forward stationed” clinics in workplaces, union halls, schools, convalescent homes, neighborhoods, wherever the risk-contracted population hangs out.

This drives the second strategic observation: Geographic datamining. Providers are not doing this yet very much, but when they come to be at risk for the health costs of populations they will be all over it like your favorite metaphor. It is now becoming trivially easy to mine your records and discover where your patients come from — not just to the zipcode level, or even the block, but to the level of the individual address (HIPAA compliant, as dots on a map).

The Ryan Health Care Proposal, Part II

Oct 3, 2011• 3

By ROBERT LASZEWSKI

In a speech at the Hoover Institution today, Representative Paul Ryan (R-WI) argued again that his proposal to reform Medicare, and now his tax credit proposal for replacing the Democratic health care law for those under-age 65, would guarantee to citizens “options like the ones members of Congress enjoy.”

His proposals would not give people the guarantees members of Congress, and all other federal employees for that matter, now enjoy.

This is not a small point.

Previously on this blog, I have argued that many of the defined contribution reform proposals, Ryan’s included, should be faulted for putting all of the future risk of health care costs on beneficiaries.

Ryan’s Medicare plan would create a premium support system for seniors. The premium support amount would increase each year by the rate of basic inflation, even though health care costs have historically increased much faster. Seniors would then take this premium support payment to the market and buy their own private health insurance policy. Another recent Medicare reform proposal by the health care industry would increase a similar health care premium support payment each year by the rate of increase in the gross domestic product (GDP) +1%.

In both cases, neither insurers nor health care providers would have any of the risk, and therefore responsibility, for keeping costs under control. The entire burden for the adequacy of these premium support payments would be with the beneficiary. If health care costs rose faster than these premium supports, tied to these indexes that have always trailed health care inflation, too bad for the beneficiary. Any excess cost is borne by the individual.

Don’t dump on the Brits’ Health IT program — they’re way ahead

Oct 3, 2011

Last week the Brits canceled their troubled NPfIT program, which lead to lots of crowing over here about our Meaningful Use program and how it’s better. But that crowing reveals two major ignorances. First, most of the money that was spent in the UK was spent on hospital IT systems, especially PACS. It wasn’t necessarily wasted, and it was not comparable to the ONC program — none of which goes to PACS. Second and more importantly, before NPfIT, EMR use among British primary care docs was ALREADY at more or less 100% and had been for the better part of a decade. (Part of) the NPfIT program was about connecting primary care practices together and with hospitals. (One reason it ran into trouble was because it wanted to replace those existing primary care systems with different ones). Over here about 10% of physicians are using EMRs, and if we’re very lucky we’ll get to about 2/3rds of where the Brits were BEFORE the NPfIT. For sure the Brits have problems, but ours are way worse and we’re starting from much further back.

Do Hospitals Cost-Shift?

Oct 3, 2011• 18

By DAVID DRANOVE

This blog continues my exploration of the great mysteries of health economics.

Northwestern University is one of Blue Cross of Illinois’ largest customers. Suppose that premiums for all BC plans are expected to increase by 10 percent, but NU is able to force Blue Cross to accept a 5 percent increase. Would you expect Blue Cross stick McDonalds with a 15 percent increase in order to cover the shortfall from NU?

I wouldn’t, for two reasons. First, McDonalds would probably threaten to take its insurance business elsewhere. Second, the scenario I have described is inconsistent with profit maximization by Blue Cross. After all, BC’s ability to stick McDonalds with a 15 percent increase surely does not depend on the price paid by NU. Any negotiator whose willingness to stick it to McDonalds is conditional on the price charged to NU is leaving money on the table and probably would have been fired a long time ago.

We might never expect BC to raise prices to some customers to make up for shortfalls from others, so why do we believe that hospitals do this all the time? It is impossible to discuss Medicare and Medicaid payments without someone invoking the mantra of cost-shifting. The theory of cost-shifting is deeply ingrained in the minds of healthcare decision makers and the policy implications of the theory are profound. Consider that if hospitals cost shift, then the burden of Medicaid cutbacks falls on privately insured patients, not on Medicaid patients and the hospitals that serve them. This calls into question whether the cutbacks will result in any savings for taxpayers and cause any harm to Medicaid beneficiaries. It also makes you wonder why hospitals that serve low income communities struggle to survive. Couldn’t they just cost-shift their way out of financial difficulty? A cost-shifting zealot would conclude that the managers of these hospitals are incompetent.Continue reading…

The Massachusetts Numbers

Oct 2, 2011• 10

By Trudy Lieberman

Last week the Census Bureau released new numbers showing that 5.6 percent of the population in Massachusetts remained without health insurance coverage. That’s a 42 percent drop in the number of the state’s uninsured since the law took effect in 2006. A new study by the Cambridge Health Alliance, one of the state’s safety net providers, showed who was left out, putting a human face on those without insurance. The findings are illuminating given that the Bay State’s health law is the model for the national law, which takes full effect in 2014, and the Romney-Perry feud often flares up around the topic of health reform in the state.

The local press, primarily the Boston Globe and WBUR, covered the story; the national media whiffed on its implications for federal reform. If reform in Massachusetts cut the number of uninsured roughly in half, the same is likely to happen nationally, according to government data. The latest Census Bureau numbers show that nearly fifty million people have no health coverage; the Congressional Budget Office estimates about twenty-three million will be still be uninsured later in the decade. It was as if the national media has forgotten that Massachusetts is a harbinger of what will happen nationally. Or perhaps it’s easier for the national media to cover the he said/he said back and forth between Perry and Romney.

Writing on WBUR’s CommonHealth blog, Carey Goldberg started with an intriguing lead that showed she could sniff out a story—and showed why others should, too.

Continue reading…

Trickle Down Health

Oct 2, 2011• 2

By JOHN MOORE

Another year, another Health 2.0 under the belt. This being the fourth time attending it is interesting to see how this event and its participants have evolved. Like many things in life, some things at Health 2.0 have changed, some have not, most for the better, but there remain some troubling aspects to this event that cannot be ignored.

When thinking back on the demos of countless vendors of years’ past, this year’s Health 2.0 had two distinguishing characteristics:

Demos are cleaner, with better user interfaces (UI).

The companies demoing at Health 2.0 are spending a lot more time and resources on creating inviting, clean and engaging interfaces that are a welcome change from the cluttered messes of demos past.

As with Mark Twain’s famous quote: “I would have written you a shorter letter if I had the time.” reducing an application to its core elements takes time. Clearly, the majority of Health 2.0 vendors this year have spent the time and resources necessary to create a simple and engaging environment for the end user.

Business models are more sophisticated.

At the first Health 2.0 event, just about every single vendor there stated that their business model was going to be based on some mix of Freemium and advertising revenue. Needless to say, just about every Health 2.0 start-up from that conference has either gone out of business, is among the walking dead (takes a lot to completely kill a company – trust me, I’ve been there) or has changed their model to survive. This year, the business models presented are more creative and for some, likely to see success in the market.

The contributing factor to these two changes is the amount of money now flowing into the health IT sector. Investors smell opportunity and are placing some pretty big bets as represented by the investments in Castlight (~$80M), ZocDoc ($50M) and CareCloud, who announced a $20M round at the event. That’s some serious cash and with all the investors that were present at this event, quite sure there are more investments in the wings.

Health Care As Economic Engine?

Sep 30, 2011

By Evan Falchuk

Former Office of Management and Budget (OMB) Director Peter Orszag is sounding a pretty serious alarm about American health care expenses lately. In the current issue of Foreign Affairs, he writes:

“The Congressional Budget Office (CBO) projects that between now and 2050, Medicare, Medicaid, and other federal spending on health care will rise from 5.5 percent of GDP [gross domestic product] to more than 12 percent. … It is no exaggeration to say that the United States’ standing in the world depends on its success in constraining this health-care cost explosion; unless it does, the country will eventually face a severe fiscal crisis or a crippling inability to invest in other areas.”

Are health care costs going to cripple America’s economy? Or could the polar opposite be true – that they are they really the overlooked engine of job growth for America’s 21st-century economy?

Consider China, a country transitioning into a modern economy, led by manufacturing. Manufacturing as a percentage of the Chinese economy today dwarfs the percentage from even 20 years ago. At this rate, manufacturing by 2050 will have all but consumed the Chinese economy, crippling its ability to invest in other areas.

It’s not outrageous to say a parallel can be drawn here with American health care.

My Non-Linear Work Stream

Sep 30, 2011• 2

By JOHN HALAMKA, MD

In the era before Blackberrys, iPhones, instant messaging, social networks, and blogs, I had a predictable day.

I could look at my week and count the meetings, lectures, phone calls, writing, and commuting I had to do.

Although my schedule was busy, I could schedule exercise time, family time, and creative time.

Today, I would not describe my work day as linear or predictable. I do as much as I can, attending to every detail I remember, and hope that by the end of the week the trajectory is positive and the urgent issues are resolved.

Here’s what I mean.

Since there are no barriers to communication, everyone can communicate with everyone. Every issue is escalated instantly. Processes for decision making no longer involve thoughtful stepsthat enabled many problems to resolve themselves. We’re working faster, but not necessary working smarter. We’re doing a greater quantity of work but not necessarily a higher quality of work.

Everyone has a mobile device and their thoughts of the moment can be translated into a message or phone call, creating a work stream of what amounts to hundreds of “mini-meetings” every day.

The Affordable Care Act Supreme Court Petitions: Issues And Implications

Sep 29, 2011• 2

By TIMOTHY JOST

Wednesday, September 28 was a busy day at the Supreme Court clerk’s office.

It had been widely expected that there would be a major pleading filed with the clerk in an Affordable Care Act challenge, as the response of the United States to a certiorari petition in the Sixth Circuit’s Thomas More case, which had upheld the ACA as constitutional, was due. A cert. petition asks the Supreme Court to exercise its discretion to review the decision of a lower court, and the losing plaintiffs in Thomas More had requested the Supreme Court to reverse that decision and find that Congress had no authority under the Commerce Clause of the Constitution to adopt the ACA’s minimum coverage requirement.

The Justice Department did file a response in that case, but very late in the day. Earlier in the day, to the surprise of most observers, three certiorari petitions were filed, asking the Court to review thedecision of the Eleventh Circuit Court of Appeals in the Florida case, which had held the minimum coverage requirement to be unconstitutional. The Eleventh Circuit upheld several other rulings of the lower court finding other parts of the ACA to be constitutional, and had reversed the decision of the lower court striking down the entire ACA as being not “severable” from the minimum coverage requirement.

Late in the morning on the 28^th, the National Federation of Independent Business and two individuals, plaintiffs in the Eleventh Circuit case filed a cert. petition, asking the Supreme Court to reverse the decision of the Eleventh Circuit refusing to hold the entire ACA to be unconstitutional. An hour or so later, the twenty-six states that are plaintiffs in the Eleventh Circuit case filed their own cert. petition asking the Court to strike down the entire ACA, but also asking the court to reverse the appellate court’s decision upholding the constitutionality of the ACA’s Medicaid expansions and of the employer mandate as applied to the states.