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Why Cost Cutting Doesn’t Work – And What Will Work

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By JOE FLOWER

Cutting costs does not cut costs. If we hope to steer health care toward a better cheaper future, we have to wrap our minds around this conundrum: Slashing spending does not necessarily improve the bottom line.

Governments in Ireland and the United Kingdom have come up hard against this conundrum. They have both faced soaring deficits due to the economic downturn, because their tax revenues have fallen at the same time that their costs for unemployment and other kinds of social support have risen.

So they both did what might seem like the sensible thing: They attacked the problem by cutting spending, in the professed belief that such a move would also increase the financial markets’ confidence in the future, and thus pump up the economy, reduce unemployment, reduce the interest the government has to pay on its debt, and increase tax revenues.

Result? Their deficits have grown even larger. Why? Because what economist Paul Krugman likes to call “the confidence fairy” never showed up. The austerity measures tanked their economies even further. Firing a lot of people, it turns out, drives unemployment up and tax revenues down. The worsening debt picture increased the cost of borrowing. Many U.S. states are headed down the same path right now, slashing spending in order to slash deficits, and the U.S. Congress is famously and forever wrangling over the same formula.

Why Medicare Is the Solution — Not the Problem

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By ROBERT REICH

Not only is Social Security on the chopping block in order to respond to Republican extortion. So is Medicare.

But Medicare isn’t the nation’s budgetary problems. It’s the solution. The real problem is the soaring costs of health care that lie beneath Medicare. They’re costs all of us are bearing in the form of soaring premiums, co-payments, and deductibles.

Medicare offers a means of reducing these costs — if Washington would let it.

Let me explain.

Americans spend more on health care per person than any other advanced nation and get less for our money. Yearly public and private healthcare spending is $7,538 per person. That’s almost two and a half times the average of other advanced nations.

Continue reading…

Why Let IPAB Control Health Care?

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By SENATOR JOHN CORNYN

Former House Speaker Nancy Pelosi once said that Congress needed to pass the new health care law so the American people can find out what’s in it. Many have since taken her up on that — and they do not like what they see in Obamacare. Seniors on Medicare are particularly alarmed by the new Independent Payment Advisory Board, which could severely restrict their access to treatments and medications.

The advisory board would change Medicare forever. This group of unelected, unaccountable bureaucrats has now been given the power to restrict access to health care for our seniors. They can do so through price controls on medical services that would become law without a vote in Congress.

This board, included in Obamacare, was bad enough to begin with, but now President Barack Obama wants to strengthen it further. After two years of wasteful spending, he sees the new board as the key to reducing Washington’s budget deficit. Instead of reforming our entitlement programs responsibly, he wants to appoint 15 “experts” to balance the budget on the backs of our seniors.

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Errors of Omission

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By ANONYMOUS MD

I am a rural Family Physician who has been in solo practice for more than 22 years.  I am neither a technophobe nor an information technology Luddite.  I have been using electronic prescribing for over 6 years and am in the market for an EHR that is net-based, scalable, interoperable and linked to a nationwide patient database.

While I wait, over the years I am seeing more and more patient care that is less co-ordinated and even thwarted by the very health information technology (HIT) that is supposed to increase efficiency. In my opinion, this is leading to decreased information transfer that is wasting precious time and putting patients at risk with errors of omission.

I will give anecdotal and real examples of HIT run amok that I suspect are more common than generally appreciated.  Alarmed by the lack of awareness of the potential frequency of these errors, I am writing this hoping that the blogosphere can somehow counter the momentum of an all-powerful HIT cerebrosphere.

1.     e-Prescribing (ERX): While mandated alerts about potential drug interactions in this software is often life-saving, it can also be life impairing.  There are two reasons for this:  1) at point of care, the warnings are just too darn sensitive and I’m being conditioned to ignore 90 percent of them.  I am afraid that this will cause me to click the “ignore” pop-up at the wrong time.  For instance, doxycycline and Dilantin have an interaction and a prescription of one in the presence in the other always prompts a warning.  When I researched this, I found the plasma concentration of doxycycline is decreased by a clinically negligible amount.   2) at the pharmacy window, the warnings can override physician judgment. A colleague of mine described to me how he prescribed a fluoroquinolone antibiotic to a patient on Coumadin and, aware that there was an interaction,  ordered the appropriate follow up testing and dosage modifications.  The pharmacist not only refused to fill the prescription,  they also did not notify him.  Instead, he asked the patient to call the doctor.  Two days later the patient was admitted to an ICU with life-threatening sepsis.  In both cases, needed prescriptions were omitted.

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Most Americans Don’t Yet Perceive the Benefits of EHRs

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By JANE SARASOHN-KAHN

Consider all the stakeholders with something to gain by moving from paper health records to digital electronic records. Who do you think would gain the most from EHRs, and who the least? A survey from Xerox finds that the among all the groups American adults say have the least to gain through EHRs is, the most common response is…patients.

29% of people aren’t really sure who’s to gain from moving to EHRs.

To better understand Americans’ views on electronic health records (EHRs), Xerox polled 2720 adults 18 and over in May 2011.

The topline finding is that 83% of people have concerns about digital medical records.  The most concerning issue is that “my” personal health information could be hacked, cited by two-thirds of people. The second most common concern is that  digital medical record files could be lost, damaged or corrupted (noted by 54%)  and that personal health information could be misused (52%). Another worry is that a power outage or computer problem could prevent providers from accessing health information, cited by 52% of people surveyed.

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When Will UPMC Explain the Whole Story?

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By PAUL LEVY

The UPMC kidney transplant story continues to develop.  This was the one where a doctor and nurse were disciplined in a matter that clearly reflected some systemic problems, more than personnel problems regarding those two people.

Now UPI reports:

A report by a federal agency on a kidney transplant at the University of Pittsburgh Medical Center suggests more problems than the hospital has acknowledged.

The Centers for Medicare and Medicaid Services said its investigation found the nephrologist should have been aware the kidney donor was infected with hepatitis C, the Pittsburgh Post-Gazette reported Tuesday. The hospital has suspended the lead surgeon and the transplant coordinator.

The CMS report said the test results were available for two months in the donor’s medical record. But none of the doctors and nurses apparently reviewed the record, and the kidney was transplanted into a man who was not infected with the virus.

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What’s the next way PBMs will make money?

Yesterday Medco offered itself up to smaller competitor Express Scripts, creating an entity with more than 50% of the PBM market. PBMs originated as specialized claims processors that supposedly were able to reduce drug costs. But in the 1990s  drug costs soared. Somehow PBMs didn’t lose employer clients, further confirming that employers are dumb about how they buy health care. Most employers didn’t understand that PBMs made much of their profits on rebates they were paid by drug companies to keep particular drugs on formulary. Almost none of that money went back to the employer. After that game ended, PBMs replaced almost all those profits by making huge margins on generics until Walmart showed that it could make a profit by charging only $4 a fill. Now it looks like extracting a bigger piece of the pie from pharmacies and charging more to employers may be the only game left for PBMs. And that’s probably the driver behind the merger.

ONC and NCI Partner to Launch Exciting New Challenge

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By Jean-Luc Neptune, Health 2.0 Developer Challenge

Health 2.0, in conjunction with the Office of the National Coordinator for Health Information Technology (ONC), is excited to launch a new innovation competition sponsored by the National Cancer Institute (NCI): “Using Public Data for Cancer Prevention and Control: From Innovation to Impact.”

This highly innovative effort is presented as part of the ONC’s Investing in Innovations (“i2”) Initiative, and is being managed by Health 2.0 through the Health 2.0 Developer Challenge program. Teams are asked to develop an application that has the potential to integrate with existing health information technology platforms and addresses targets at one or more points on the cancer control continuum, using public data that are relevant to cancer prevention and control.

Teams are required to address challenges faced by consumers, clinicians, or researchers on the continuum of cancer control. Suggested targets include promoting healthy behaviors (e.g., nutrition, physical activity, smoking cessation), early detection and screening, informed decision-making, and adherence to treatment plans.

This is a two-phase challenge. Submissions for Phase I are due August 26, 2011, and will be judged on their use of cancer-related data, as well as potential for impact, innovation, and usability. Finalists from Phase I will receive a $10,000 award at a major health IT conference in September 2011. In Phase II, up to two winning teams from the slate of finalists will each receive a $20,000 award at an international system sciences conference in January 2012.

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Health Care Reform in 2 Short Sentences

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By DAVID E. WILLIAMS

Foes of the Patient Protection and Affordable Care Act (PPACA) made a big point of complaining about the length of the bill. Personally, I think that criticism is unfair, because the law deals with a complex industry that’s almost one-fifth of the economy.

But today I read a brilliant two-sentence proposal in the letters section of the Wall Street Journal from David J. Gross, a Florida dermatologist. He was reacting to an article about the extensive cardiac care received by former vice president Dick Cheney.

Before any of Dick Cheney’s heirs get a nickel from his estate, Medicare should be reimbursed for the difference between what it paid out versus what he paid in all these years. This same paradigm should apply to all of us.

(Actually the essence is expressed in just one sentence.)

If we actually implemented that solution it would have significant salutary effects:

* Make Medicare financially viable for the long run
* Improve inter-generational equity
* Instill cost consciousness in Medicare beneficiaries, thus keeping a lid on expenses
* Reduce the need for an estate tax

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The AAFP’s Bold New Valuation Initiative

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By BRIAN KLEPPER

This morning, the American Academy of Family Physicians, the largest and “purest” of the major primary care societies – the American College of Physicians (ACP), the American Academy of Pediatrics (AAP) and the American Osteopathic Association (AOA) are all heavily influenced by sub-specialists – announced that it has convened a national task force charged with identifying new, better approaches to value primary care services.

This initiative is nationally significant for several reasons. By definition, it challenges the methodology used for nearly two decades by the American Medical Association’s Relative Value Scale Update Committee (AMA RUC), which has drastically under-valued primary care services while over-valuing many specialty services. By taking on this effort, it not only announces that the fruits of the AMA RUC’s labors are unacceptable, but also points out that the methodology the RUC uses to value medical services – this is founded on the Resource-Based Relative Value Scale (RBRVS) “input” taxonomy developed by William Hsaio’s team in the late 1980s – is incomplete and outdated. For example, the RUC’s methodology for calculating value doesn’t consider whether a service produced a worthwhile benefit to the patient or society, whether it was evidence-based or even necessary. More on this in a future article.

Next, the task force is not limited to AAFP members, but a wide range of professionals drawn from other primary care medical societies, business, the health plan sector, policy groups and subject matter experts. See the bios here. (I’ve been asked to participate, and will be honored to do so.) In other words, unlike the RUC, this group is more representative of the sectors whose interests it will focus on.Continue reading…

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