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Reverse Innovation & The Cost Crisis in American Healthcare

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By KENT BOTTLES

The realization that the American health care system must simultaneously decrease per-capita cost and increase quality has created the opportunity for the United States to learn from low and middle-income countries. “Reverse innovation” describes the process whereby an inexpensive innovation is used first in countries with limited infrastructure and resources and then spreads to industrialized nations like the United States.

The traditional model of innovation has involved the creation of high end products by companies in industrialized nations and the spread of these products to the developing world by adapting them to function in low and middle-income countries. Reverse innovation reverses the direction of spread with the United States borrowing new ideas and products designed for less wealthy countries in order to deliver health care more efficiently. (1)

Resource challenged low and middle-income countries are different from the United States in at least six ways that can serve as catalysts for such reverse innovation: 1) affordability, 2) leapfrog technologies, 3) service ecosystems, 4) robust systems, 5) new applications, and 6) the absence of intermediaries. (2,3)

These nations can’t afford expensive goods so they have to find inexpensive materials or manufacturing options. They also lack 20th century infrastructure and so they have leapfrogged to newer technologies such as mobile phones or solar energy instead of landlines and petroleum based energy sources. Service ecosystems develop in developing countries because entrepreneurs have to rely on others for help by creating new partnerships like video-game cafés where gamers test new products. Emerging markets require products that work in rugged conditions, and customers in poor countries have few product choices, providing market openings for add-ons that update and extend the lives of existing merchandise. (2) Intermediaries such as venture capitalists, universities, and regulators are also often underdeveloped in poorer countries. (3)Continue reading…

ONC Invests in Innovation Challenges

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By Matthew Holt

Health 2.0 is thrilled to announce that we are launching two challenges as part of the official kick-off of the Investing in Innovation (i2) program. Over the next 2 years the ONC will be issuing nearly $2 million in prize money for numerous challenges all designed to inspire innovation in health information technology. Along with our colleagues at Capital Consulting Corporation, Health 2.0 is the contractor supporting this effort. We started with a joint NCI/ONC effort which is already underway, but now the first two challenges are live. And they are:

  • Reporting Device Adverse Events Challenge ONC is asking multi-disciplinary teams to develop an application that facilitates the reporting of adverse events related to medical devices, whether implanted or used in the hospital, clinic, or home. This challenge has $40,000 in total prizes
  • Ensuring Safe Transitions from Hospital to Home Challenge. ONC is challenging software developers to improve care transitions and build upon these tools by generating an intuitive and easy-to-use application to empower patients and caregivers that fits into existing ways that providers communicate. This challenge also has $40,000 in total prizes.

These are both critical parts of health care where new innovation can make a big difference–and developers can win a substantial prize to get them on their way.

Have We Not Been Looking at Things We Should Have Seen?

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By PAUL LEVY

A remarkable aspect of the Parkland Memorial Hospital saga was the degree to which the hospital’s Board was not given information by senior management about the clinical outcomes in their hospital.  The lack of transparency, in other words, even went to management’s relationship with its fiduciary board.

A recent article by the Dallas Morning News outlines some of these points:

On August 19, the hospital’s seven-member board of directors got its first chance to read the full report by the U.S. Centers for Medicare & Medicaid Services.  Almost 10 days had passed since [the CEO] first received the findings.  As members began leafing through pages of the report, surprise, even shock, began to register.

The Chair of the board said, “We had direct culpability, but none of us even knew we were in the report.”

Continue reading…

The Anti-Injunction Act Complications

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By BRAD JOONDEPH

The big news from [last Friday’s] two decisions was not that Virginia lacks standing; that was a problem lurking in that case from the beginning, a nettlesome issue going all the way back to Judge Hudson’s first opinion (in August 2010) rejecting the United States’s motion to dismiss on 12(b)(1) grounds. Virginia would have stood on much stronger ground had it also alleged an injury in fact from the effect of the minimum essential coverage provision’s necessarily pushing more Virginia residents onto the state’s Medicaid rolls, and thus imposing a significant financial cost on the state. But the Commonwealth failed to do this, instead resting on the claim that it had standing based on the alleged “conflict” between its Virginia Health Care Freedom Act and the individual mandate. This was a weak argument from the beginning, and the Fourth Circuit’s holding was entirely unsurprising.

What is surprising–perhaps not on the merits, but in relation to the attention the issue has received to date, from the courts and the parties–is the court’s holding in Liberty Universityv. Geithner that federal courts lack any subject matter jurisdiction over a suit seeking to enjoin enforcement of the individual mandate because such jurisdiction is precluded by the Anti-Injunction Act. In this respect, there are some important points worth noting:

* This is a potential problem in every lawsuit currently challenging the individual mandate. That is, if the Fourth Circuit’s analysis is correct, then the Supreme Court would lack jurisdiction to hear any private plaintiff’s claim that the minimum coverage provision exceeds Congress’s enumerated powers until after a taxpayer was assessed a penalty under ACA 1501, paid the penalty, and sued the federal government for a refund. The case thus would not reach the Supreme Court until somewhere in the neighborhood of 2015 or 2016.

Continue reading…

The Doctor is Social

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By Jane Sarasohn-Kahn

Doctors and hospitals are going social, adopting social media for professional and clinical use, based on surveys conducted in mid-2011 by QuantiaMD and Frost & Sullivan and the Institute for Health Technology Transformation (iHT2).

In Doctors, Patients & Social Media, dated September 2011, QuantiaMD and the Care Continuum Alliance report a high level of physician engagement with online networks and social media. Two-thirds of physicians are using social media for professional purposes, and see potential in the use of these channels to facilitate patient-physician communication. The survey found a cadre of “Connected Clinicians” who use multiple media sites to positively impact patient care. Over 20% of clinicians use 2 or more sites.

Only 1 in 10 physicians is familiar with one or more online patient communities, as the first chart illustrates. Among those who know about at least one community, a majority believe the sites have a positive impact on patients (either very positive or positive in the survey response). This is true across various condition categories, especially for rare diseases, cancers, chronic conditions, maternal and child health, and wellness/prevention. As one physician shared anecdotally, “Patients can share their stories, learn from others, spread knowledge, and instill hope.”

Continue reading…

AHIP Video Series: McKesson

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By DEB LINTON

Continuing with our AHIP Video Series, Health 2.0 and THCB sat down with McKesson‘s VP of Decision Management, Matt Zubiller. McKesson Corporation is the world’s largest and oldest healthcare services company, and McKesson Health Solutions (MHS) is its payer-focused business unit. For 35 years, MHS has delivered solutions with the industry’s soundest and most widely used clinical evidence and expert technology to help payers and providers collaborate to achieve better healthcare outcomes at lower costs. Each solution in the MHS portfolio is designed to decrease administrative costs, create efficient provider networks, manage both risk and medical costs, and improve care quality and outcomes. In this video, learn more about why MHS solutions touch more than 160 million cov­ered lives, and are used by 96% of the top 25 health plans, payers of all sizes, 4,000 hospitals, and numerous federal agencies.

Yes, The Federal Exchanges Can Offer Premium Tax Credits

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By TIMOTHY STOLTZFUS JOST

Whatever else the Affordable Care Act may accomplish, it has provided endless entertainment for law professors.

The latest ACA kerfuffle involves the discovery by critics of the ACA of an ACA drafting error that would seem to deprive millions of uninsured Americans of tax credits to purchase health insurance and invalidate regulations recently proposed by HHS and the Treasury Department. The mistake is found in section 1401 of the ACA, which creates a new section 36B of the IRC. Two subsections of 36B ((b)(2)(A) and (c)(2)(A)(i)) suggest that premium tax credit eligibility under the ACA depends on the applicant being enrolled in a qualified health plan “through an Exchange established by the State under section 1311.” This would in turn suggest that individuals enrolled in a qualified health plan through a federal exchange established under section 1321(c) would not be eligible for premium tax credits, contrary to the recent proposed regulations.

That this is a drafting error is obvious to anyone who understands the ACA. Section 1311 of the ACA requests the states to establish American Health Benefit Exchanges and sets out the duties of the exchanges. Section 1321 of the ACA, however, provides that if a state elects not to establish and exchange or fails to do so, HHS must “establish and operate” an exchange in such a state and “take such actions as are necessary to implement” the other requirements of title I of the ACA, which includes section 1401. There is no coherent policy reason why Congress would have refused premium tax credits to the citizens of states that ended up with a federal exchange. None of the CBO reports scoring the ACA suggest that premium tax credits would only be available though 1311 state exchanges and not through 1321 federal exchanges. It is, finally, highly unlikely that the House, whose bill included only a federal exchange, would have approved a bill that only provided tax credits through state exchanges but not through the federal exchange.Continue reading…

We’re From The Government. We’re Here To Help …

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By WHITECOAT, MD

The clock is ticking for Parkland Memorial Hospital in Dallas.

Earlier this month, Parkland was cited by the Centers for Medicare & Medicaid Services for several “serious threats” to patient safety. As a result, the hospital is now in jeopardy of losing its ability to participate in the Medicare program unless it submits “correction plans” to CMS by August 20, 2011.

According to a CMS spokesperson, two violations relating to infection control and emergency care issues were “so serious that they triggered ‘immediate jeopardy’” for the hospital. In fact, the reasons for the citation were so heinous that CMS won’t even disclose them to the public until Parkland submits plans on how to fix those super secret problems. That’s the subject of another WTF discussion, but we’ll save that one for later.

The event triggering the CMS investigation involved a schizophrenic psychiatric patient with a heart condition who died while in the emergency department. The report states that the technicians who subdued the man did not have “effective training” and that the patient was not closely monitored before his death.

According to the article and an interview Parkland’s Chief Medical Officer, Parkland was cited for several reasons. Based on what I can gather from the article, two of the hospital’s citations were for:

– Moving patients with less serious symptoms to a separate urgent care center for medical screening
– Staff touching a patient and then touching other surfaces that people would come into contact with

Think about how grave these dangers are.

Continue reading…

Time to Make Joint Commission Surveys Public

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By PAUL LEVY

Can anyone doubt that the recent kerfuffle faced by Parkland Memorial Hospital in Dallas would have had a greater chance of being avoided if earlier reviews by the CMS-designee, the Joint Commission, would have been made public?  Yet, JC surveys are held in confidence.  This is a matter of federal law.

Currently, the results of hospital accreditation surveys cannot be accessed by the public under Section 1865 [42 U.S.C. 1395bb] (b) of the Social Security Act, which reads as follows:

“(b) The Secretary may not disclose any accreditation survey (other than a survey with respect to a home health agency) made and released to the Secretary by[615] the American Osteopathic Association[616] or any other national accreditation body, of an entity accredited by such body, except that the Secretary may disclose such a survey and information related to such a survey to the extent such survey and information relate to an enforcement action taken by the Secretary.”

When I was CEO of a hospital, we voluntarily made our JC surveys public, posting them on our corporate website.  We felt that it was important for all staff in the hospital to have the chance to review the findings and act on them, and we also felt that public confidence in our hospital would be enhanced by this kind of transparency.  While this practice has spread somewhat, most hospitals still do not make their surveys public.

Continue reading…

Another Modest Proposal* – Paying for Physician Training

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By PAUL FISCHER, MD

One of the main considerations in physician pay under CMS’ relative value system is the training required to complete a task. This is generally thought to be well understood but is, in fact, a quagmire of controversy.

Take for example the specialty of family medicine compared with dermatology, anesthesiology, or ophthalmology. Family physicians make between 1/2 and 1/3 of what these other specialties make, so one would think that there is a huge training difference. The truth is that each of the four require 16 years before medical school, 4 years of medical school, and 3 years of residency.  The 3 highly paid fields require 1 additional year in a transitional internship.  So the family physician education represents 23/24 or 96% of the length of education required for the others.  Since when is a 4% investment worth a 200% to 300% return?

There are, of course, longer training programs.  Internal medicine fellowships are 2 to 3 years on top of a 3-year residency.  There was a time when this made sense, since the idea was to educate competent general clinicians and then for them to specialize in a narrower field.  Given the limited general physician work of, let’s say, cardiology, one could easily argue that the 3 years of internal medicine training are wasted. Should cardiologists, therefore, be credited with 23 or 26 years of training? It would obviously be more efficient to move these physicians directly from medical school into the cath lab.

There are some physicians who keep going on and on in their training, completing one residency and then another. One fellowship and then another.  CMS must come up with a numerical way to appropriately compensate these individuals for their time, yet discount it for any lack of relevance that their training might have for performing a particular procedure.  Take, for example, the resident who completes his general surgery training then goes on to do a fellowship in vascular surgery, then goes into practice and limits his practice to the laser closure of veins, a technique he learned in a weekend CME meeting.  Should this physician’s income reflect 7 years of training or 3 days?Continue reading…

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