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Can CMS Be a Venture Capitalist?

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By PAUL LEVY
Paul Levy 1

Lisa Suennen, a venture capitalist, writes this post about the provision in the national health care reform act that created the Center for Medicare and Medicaid Innovation (CMI). This agency has $10 billion to “research, develop, test and expand innovative payment and service delivery models that will improve the quality and reduce the costs of care” for patients covered by CMS-related programs. Lisa notes, “What is great about CMI is that they have the authority to run their programs much more like a business would without many historical governmental constraints. ”

I don’t want to be a stick in the mud, particularly as my able friend Don Berwick takes charge of CMS, but I want to point out that previous efforts by the government to be innovative in other fields have failed because:

(1) Venture funding embodies risk-taking. Government usually does not do this because there is a political imperative never to be blamed for misspending taxpayer money. The bureaucracy, therefore, systematically eliminates ideas that are untested.Continue reading…

Can Health 2.0 Improve EHR Adoption?

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By Matthew Holt



HEALTH 2.o GOES TO WASHINGTON: This panel discussed the Electronic Health Record (EHR) and ways to improve its adoption and the relationship between physicians and patients. The moderator was Joshua Seidman, Office of Provider Adoption Support at ONC 9formerly from Ix Center) and true to his past Josh was focusing on the needs of the patient. The patient representative was the now famous Regina Holiday, with Jon White from AHRQ and Ted Eytan, from the Permanente Federation also on the panel. Watch for the cool AHRQ commercial about patients asking questions.

Introduction to Health 2.0 Goes to Washington

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By Bianca Grogan

SUBTEXT: At the start of  the Health 2.0 Goes to Washington Conference, June 07, 2010, Matthew Holt and Indu Subaiya welcomed all of the conference attendees with an introduction to Health 2.0. In the middle of that introduction Wil Yu, Director of Innovation at the Office of the National Coordinator for Health IT (ONC), gave his opening remarks and spoke about health innovators and initiatives.

How About “Meaningful Exchange”?

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By JONATHAN BUSH

At last, we have received from Mt. Olympus those much awaited writings….the definition of “meaningful use”!

Oy.

I understand how we got here. I could put myself in the shoes of government  decision-makers at every step of the way and see myself doing the same thing. “Step in and help … EMR adoption is too slow and costs are rising too high … the free market isn’t working, so step in.” I get that.

“Make the definitions hard and truly meaningful so that after we are thrown out of office, the social benefit of this program of ours will outlast the pure stimulus effect and create real social change in the health care market.” I get that too.

“Let hospital-owned practices into the mix. Even though we know they have the money, we want their leadership. Also, lots of docs are affiliated with hospitals.” This one was tough for me even though I have a lot of hospital clients that own practices and are growing that business.

“Delay a little to see if we can get more people to our higher standard.” Okay.Continue reading…

The Insurer’s Dilemma

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By PAUL LEVY

Paul Levy

This has to be a very difficult time for insurance companies in Massachusetts. Notwithstanding that they are non-profits, they are under a lot of scrutiny with regard to reserve margins and profitability. Much of this is unfair, but I think that is just a sign of the times. Hospitals face a similar issue, too. Doctors are certainly next in line.

But the Massachusetts insurers have an additional problem. As we have discussed here, they have been participants in creating a very large disparity in payment rates among hospitals, rate differentials based mainly on providers’ market power. They are now under pressure to limit rate increases to hospitals, but the ones that come up for renewal are not necessarily the ones that have received higher rates.

Nonetheless, insurers are telling those who are up for renewal that they should expect no rate increase at all, or at best, an increase well below the rate of medical cost inflation. Those hospitals, by definition, are the ones without market power. So if the insurers hold them to low rate changes, the disparity between the have’s and the have-not’s will grow. This enhances the market power of their competitors, allowing them to poach doctors into their networks and gain still more market power. This increases the percentage of patients who go to the high-rate providers, aggravating the overall health care cost situation.

Continue reading…

The Original Individual Mandate, Circa 1792

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By BRADLEY LATINO

Revolutionary-war-soldiers  Regardless of one’s opinion on the Patient Protection and Affordable Care Act’s constitutionality, most commentators-and no less an authority than the Congressional Budget Office)-agree (or concede, as the case may be) that Congress has never required Americans to purchase a good or service from a private entity as a condition of citizenship.  But, importantly, they are wrong. The ongoing debate over the mandate’s constitutionality has uncovered an unlikely precedent to the PPACA’s individual mandate to possess health coverage. I recently wrote about this overlooked original individual mandate in an article, “The First Individual Mandate: What the Uniform Militia Act of 1792 Tells Us about Fifth Amendment Challenges to Healthcare Reform.”

The Militia Acts of 1792, passed by the Second Congress and signed into law by President Washington, required every able-bodied white male citizen to enroll in his state’s militia and mandated that he “provide himself” with various goods for the common weal:

 [E]ach and every free able-bodied white male citizen of the respective States . . . shall severally and respectively be enrolled in the militia . . . .provid[ing] himself with a good musket or firelock, a sufficient bayonet and belt, two spare flints, and a knapsack, a pouch, with a box therein . . . and shall appear so armed, accoutred and provided, when called out to exercise or into service

This was the law of the land until the establishment of the National Guard in 1903.  For many American families, compliance meant purchasing-and eventually re-purchasing-multiple muskets from a private party.

This was no small thing.  Although anywhere from 40 to 79% of American households owned a firearm of some kind, the Militia Act specifically required a military-grade musket.  That particular kind of gun was useful for traditional, line-up-and-shoot 18th century warfare, but clumsy and inaccurate compared to the single-barrel shotguns and rifles Americans were using to hunt game.  A new musket, alone, could cost anywhere from $250 to $500 in today’s money.  Some congressmen estimated it would cost £20 to completely outfit a man for militia service-about $2,000 today.

Continue reading…

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