Thursday, May 21, 2015

Predictions for a 50% Health Care Economy

Health care costs too much.  Having to pay more for doctors, hospitals and pills is threatening national security, undermining our industrial competitiveness, leading to underinvestment in vital infrastructure and exacerbating economic inequality. As we devote more and more of our individual household budgets, business revenues and national treasure to healthcare, it these excess costs will "crowd-out" our ability to pay for other worthy stuff.

Naturally, insightful Population Health Blog readers know the real story is more complicated than that. Inflation-adjusted costs of other "stuff" that comprise much of the U.S. economy have dropped. As the denominator has gotten smaller, the health care numerator appears relatively bigger.  More on that here

What's more, as society has benefitted from lower energy, housing, transportation and food costs, consumers are better able to choose to shift resources toward the health care that they want, which further fuels its growth. 

Plus, there's the observation that government subsidies have a significant impact. Our elected officials are advancing their constituents' wishes, right?

Right now, it appears that health care is costing just under 20% of the U.S. gross domestic product (GDP). Between our

1) appetite for more health care,

2) cheap robots doing everything else for us and

3) the inability of government bureaucrats to resist ever more meddling....

the PHB suspects that the percent of GDP going toward the medical-industrial complex is destined to hit 50%.

The provocative PHB asks if that's such a bad thing.

If 50% of all persons disabled or retired, the other 50% of us can look forward to the happy prospect of being gainfully employed thanks to taking care of them. 

If that's our future, the PHB has some other predictions:

1. 50% of all parking space acreage (for our Google Cars, naturally) will be devoted to the disabled.  The rest of us will benefit from longer walks, with a 50% greater likelihood of achieving our 10,000 per day step quota.

2. 50% of primary care providers won't be physicians.  But 100% of all those non-physicians will have slept in a Holiday Inn last night!

3. For those primary care physicians who remain in practice, 50% of their income will be thanks to the burgeoning science of tattoo removal, botox and dermal fillers.

4. 50% of all wheelchairs and bedside commodes will be of the "jumbo" variety.

5. 50% of all medicines will have dire "black box" warnings.  Likelihood that patients will actually take them will be decreased by 50%.

6. Automated decision support will thwart the ability of lawyers to sue doctors.  Following a path of least resistance, the legal community will respond with a 50% increase in lawsuits in other growth areas of the economy, such as robotic cars and pillow manufacturing.

7. Despite automated decision support, 50% of all providers will still detest their electronic record system.  The other 50% will loathe it.

8. 50% of all mental health counseling will be automated. Not kidding!

9.  When health systems finally grasp the impact of handhelds and apps, there will be a 50% increase in desk-top PC recycling.  Chances that DC's "meaningful use" criteria will recognize this soon enough are 50-50.

10. Growing traffic on the PHB's blog will lead to a 50% increase in its vast web-site related income. There is a 100% chance, however, that the PHB Spouse will not be suitably impressed.

Image from Wikipedia

Monday, May 18, 2015

Vegas' Healthcare Lessons: A Field Trip Report

The Population Health Blog spent the last week in Vegas exploring the actuarial, medical, predictive, economic, social and quality dimensions of an important part of the property and casualty insurance industry.

If memory serves, this was the fourth time it was there.  And a lot has changed over the last few years

Naturally, the PHB's commitment to lifelong learning shielded it from Sin City's too-numerous -to-count temptations.  Being in windowless conference rooms from 7 AM to 6 PM prevented it from the succumbing to The Strip's scintillating jewelry displays, blinka-blinka light pollution and siren call of unfavorable risk-transfer arrangements (a.k.a. "gambling").

Plus, having the spouse for company helped, even though she vetoed perfectly reasonable entertainment options like this and this.  As a consequence, the PHB limited itself to an evening show and a variety of interesting eateries. The good news is that, as a result, the field trips outside the meeting venue gave it some time to compare the "old" and today's "new" Vegas to derive some healthcare lessons:

Old Vegas:

Small hotel lobbies, walls, winding walkways.

New Vegas:

Open hotel atriums, mirrors but still winding walkways

Lesson: You don't have to give away the keys to the business to give the consumer the impression of transparency. While healthcare has a long way to go on truly transparent pricing, the PHB suspects there will be a lot of mirrors and winding walkways between where we are now and where we want to go.

Old Vegas:

Rooms at $250 per night

New Vegas:

While rooms on The Strip can be $300 per night, that's comparatively less in inflation adjusted dollars, plus there are remote controlled curtains for the floor to ceiling windows and one, if not two, flat screen TVs.

Lesson: Consumers are expecting more quality at less cost. Healthcare remains an economic outlier.

Old Vegas:

Computerized slot machines

New Vegas:

Computerized insights on the users of the slot machines

Lesson: Knowing background, revenue/cost determinants and risk preferences of your customers is critical.  In healthcare, we call this "big data."

Old Vegas:

Illusionists, Carrot Top, The Osmonds, Elton John and Cirque

New Vegas:

Illusionists, Carrot Top, The Osmonds, Elton John and Cirque in over the top stages and elaborate auditoriums.

Lesson: If you have a winning formula, stick to it and do it better. Even though health insurers may get in the way, more patients will seek you out.

And finally.....

Old Vegas:

Some homeless people

New Vegas:

More homeless people. 

Lesson: The economy recovery is failing the most vulnerable

Image from Wikipedia

Tuesday, April 28, 2015

For the Commercial Health Insurers, Winter Is Coming

Fans of HBO's hit fantasy TV series Game of Thrones will recognize the adage. 

In the show, the continent of Westeros has had a long hot summer of breasts, butts and beheadings. Now, it's not only getting colder, but there have been sightings in the North of blue-eyed freeze-dried warrior zombies. Crops are failing, the northern tribes are fleeing and the crows are looking more sinister by the minute. The only thing that separates civilization from catastrophe is The Wall.  That's made of a lot of ice and it is guarded by the Night's Watch.  The Watch is made up of mostly unsavory criminal types who have been given the choices of decapitation or taking The Oath.  Think of them as the Fence Frozen Legion.  Cue camera, raise swords... action!

Naturally, the Population Health Blog is enjoying every minute of it, and so is, inexplicably, the PHB Spouse.  We're both gained valuable insights.  While the PHB ponders her observation that men are untrustworthy swine, it has more constructively responded that Game of Thrones has many lessons that speak to the health insurance market.

To wit:

The Night's Watch may be made up of villains, but they're our villains and they're performing a valuable function.  Commercial health insurers likewise have their knaves, but for years they have been pooling risk and paying claims. 

Unfortunately, times are changing. While we've had a lusty summer of low cost inflation and innovation, Accountable Care Organizations are not as successful as hoped, insurer networks have gone skinny, out-of-pocket expenses are climbing and tax bills are coming due.  While we thought the undead "Medicare for All" was just an unpleasant memory, there have been sightings here and here

Will the Night's Watch of commercial insurers hold the wall?  Cue camera, raise swords.... action!

Image from Wikipedia

Thursday, April 23, 2015

The Latest Health Wonk Review Is Up

The Health Wonk Review is a linked summary of the better insights from smart health policy bloggers.  The latest edition is hosted by Joe Paduda of Managed Care Matters.


Wednesday, April 22, 2015

Curing the Healthcare Digital Divide: There's an App for That

Whither meaningful use?
For better or worse, policymakers, politicians and health leaders in the United States are committed to achieving paperless healthcare environment. Even if there is lack of high quality research and reasonable skepticism over the ultimate cost and quality merits of "e"care, there is no going back.

As a result, visitors to ehospitals and eclinics are increasingly surrounded by monitors that, in turn, are surrounded by providers. To gain their attention, patients need to have internet access to make appointments, update medications, obtain education and communicate with their doctor.

And what if they don't have that access? For the last decade, that worry has been characterized as "the healthcare digital divide. " As recently as 2014, it's been documented that the lack of computer hardware and access can have important healthcare implications for persons with low socioeconomic status.

For the doctors and nurses staring at screens all day, the millions of Americans who are living paycheck to paycheck risk being out sight and out of mind.

But it turns out that that it doesn't need to be that way.

The PHB explains.

Check out this telling report from the Federal Deposit Insurance Corporation on the "unbanked" and "underbanked."  Not having a bank account (unbanked) or using any financial services (underbanked) are linked to persons with low income, being of color, disability and being unemployed.

In other words, these are the very persons at risk of being on the losing end of the health care digital divide.

While there's interesting data on how close to 8% of U.S. households are unbanked and just over 20% were underbanked, there were also these stunning observations:

"Relative to fully banked households (86.8%), underbanked households were somewhat more likely to have had access to mobile phones (90.5%) and smartphones (64.5% of underbanked households compared with 59.0 percent of fully banked households)."

"Notably smaller, but still significant, proportions of unbanked households had access to mobile phones (68.1%) and smartphones (33.1%)" (bolding PHB).

In other words, persons of low socioeconomic status are more likely to have smart phones vs. the "banked" population. They may not have a checking account, but, compared to other segments of the population, they are also more able to use these devices to access and manage their "e"care.

The PHB's conclusions?

1. Not  explicitly fostering heandhelds as a part of the healthcare informatics "ecosystem" may be shutting out persons of low socioeconomic status from the health system. While the Washington DC's "meaningful use" (MU) criteria are not explicitly tilted toward desktop/tower computing, they seem to conspicuously silent on advocating for ease of smartphone use, for example, to manage appointments, medications, education and messaging. 

Compare MU that with Google's mobilegeddon and the unwillingness of innovative systems (like this and this) to wait for CMS to catch up.  They're loaning handhelds to patients.

What do you know: if you want to increase access to healthcare for the economically disenfranchised, there truly is an app for that.  It was there all along.

2. Yet, smartphones for the economically vulnerable and access to health information technology are not necessarily a slamdunk.  This report reminds us that smartphone contracts are vulnerable to non-payment and that it's not unusual for service to be turned off. 

Health systems that can navigate that reality that will win.

Image from Wikipedia

Friday, April 17, 2015

Some Social Media on the Topic of Social Media

Thanks to this outfit, the Population Health Blog discovered this compelling factcandy video on the topic of social media. 

In the meantime, Fatboy Slim's earcandy has been added to the PHB workout playlist.

Wednesday, April 15, 2015

Reform of Medicare's Sustainable Growth Rate: Be Careful What You Wish For

Be careful what you wish for.  The law of unintended consequences.  I'm from the government and I'm here to help

These were the nostrums that the Population Health Blog considered when the Senate passed House Bill 2 and killed the walking budgetary undead known as the Sustainable Growth Rate or SGR

As PHB readers know, the Balanced Budget Act of 1997 law attempted to use the SGR to substitute medical inflation with general inflation adjustments to the Medicare physician fee schedule.  Since the costs of CAT scans have risen faster than cat food, Congress periodically had to pass catch-up "fixes."

As the PHB understands it, the just-passed "Medicare Access and CHIP Reauthorization Act of 2015" undoes the SGR by substituting 0.5% increases for the next five years.  Medicare payment cuts that were scheduled to kick in immediately have been averted - just in time.

The PHB will review what the bill does.  Then it will look at some downsides.

What does the bill do?

During the five year period, Medicare will transition to two new payment models.

In 2019 the Physician Quality Reporting System (PQRS), Value-Based Modifier and electronic record Meaningful Use (MU) will be consolidated into single program dubbed the Merit-Based Incentive Payment System (MIPS).

Physicians who choose to participate in MIPS will be assessed on a consolidated measure of quality, cost/utilization and electronic record MU.  They will also have to report on participation in quality improvement activities. CMS will offer technical assistance for QI. Medical organizations will be able to provide input into quality. The quality data will be collected and housed in certified registries. More research will be applied to emerging science of risk adjustment for cost/utilization.

The MIPS composite performance score will range from 0 to 100 (it's on page 40 of the Bill). MIPS incentive payments will be adjusted based on change from baseline using the mean as a performance threshold. Physicians who fail to report or participate will automatically be assigned a score of zero.  Physicians participating in a medical home (as defined by Medicare) will automatically be assigned the highest score.

Physicians falling below the mean will experience percentage-based payment cuts.  Payment incentives for the winners will be budget based. Physician-specific data will be made publicly available.

MedPAC will be charged with monitoring MIPS impact on Medicare beneficiary access to care.

There are also incentives for physicians to leave MIPS behind and participate in alternative payment models (APMs). The incentives will be greater than the MIPS program, giving physicians another reason to join an ACO.  If successful, fee-for-service will eventually go away.

The PHB's take on the legislation? 

Something is better than nothing, but the PHB readers need to be aware of the potential downsides:

0.5% increases may not keep up with physician costs.  While the SGR was repugnant, the patches were tied to medical cost inflation. 

As Congress continues to "reform" health care, uncertainty will continue to abound.  Never mind the continued vulnerability of a fifth of our economy to partisan rancor, this particular bipartisan exercise in legislation still went to the wire.  That's success?

Congress - which admittedly knows little about health care - is still outsourcing considerable administrative judgment to the Secretary of HHS. This is a political appointee who presides over a vast and largely unaccountable bureaucracy.  That is, unless, you have pull like this.

While it's called "APS," it doubles down on ACOs, which still have an uncertain impact on cost and quality. We still do not know how to reconcile the theoretical efficiencies of large provider systems with the real world need for antitrust enforcement.

If - emphasis on the word if - MIPS and APS don't work out, more physicians will flee the Medicare program.  They'll cater to credit-card wielding patients, further reducing access to socioeconomically vulnerable persons who have no other options.  While the legislation charges MedPAC with monitoring access to care, they may not spot problems in time.

As for MIPS:

The economic upside incentives are based on an assumption that the money will be there and that Congress will fund it.

PQRS and MU programs, which are still based on dubious evidence (here and here), are alive and well.

Because there's a mean or median on a 0 to 100 scale, 50% of participating docs are guaranteed to be economic losers.  That information will be in the public domain.  And that's only part of the problem.

Gaming may still be possible. Examples include avoiding high risk patients, questionable links between reporting vs. outcomes and moving the goalposts by changing reporting thresholds

Reporting MIPS data may turn out to be odious; similar tone-deaf hassles and their associated costs led to the rebellion against specialty society maintenance of certification.

Medicare will provide technical assistance? Really?

Wednesday, April 8, 2015

Healthcare Cybersecurity: Lessons for America's Corporate Boards

When this article by the Population Health Blog was published in the prestigious policy journal Health Affairs almost a decade ago, little did it know that it had too little skepticism over what the policy experts were saying about the electronic health record. Since its publication, not only have the interminable cost and quality shortcomings persisted, but hospitals' and clinics' health information technology (IT) has also become a ripe target for hackers.

Who knew?

Which is why the PHB understands the bitter disappointment of directors serving on U.S. boards of directors. IT was supposed to usher in unprecedented levels of innovation, efficiency and consumerism. Little did they know that IT vulnerabilities could also torpedo their company's brands (like this), spawn sovereign criminal gangs, compromise consumers' personal privacy, hollow out their middle class customer-base, lead to a silicon-based robber baron class and propagate Baumol's cost disease.

According to this April 6 Wall Street Journal article, boards are responding to cybersecurity threats by appointing technology committees, making IT a regular part of their meeting agenda, regularly huddling with their company's information officers, monitoring dedicated threat assessment dashboards and recruiting new board members with a background in IT.

The National Association for Corporate Directors (NACD) would agree. This recent report suggests that boards also need to understand the value of their company's information by asking where their data "crown jewels" are and who would want them. They also need to periodically conduct "deep dives" on the topic of e-security, ask their company's executives about response/disaster plans, scrutinize the "tone at the top," assess employee awareness and oversee appropriate hacker stress testing. Last but not least, boards don't necessarily need "expert" members but, rather, members with IT "literacy."

The PHB's physician colleagues have that literacy and feel their pain. Check out this recent article in the New England Journal that describes the travails of health IT. According to the author, 94% of health care institutions have not only been the victims of cyberattacks, but they also have the dubious distinction of sustaining the greatest dollar cost per record-breach. While HIPAA's numerous privacy and security mandates should have given the health care industry a multi-year head start on IT security, hospitals and clinics are still struggling not only with the usual IT challenges, but with the vulnerability of their internet-of(-medical-device)-things and a growing body of antiquated or vague federal and state regulations.

The PHB's take? 

If the healthcare industry is any guide, corporate boards need to know that:

1. Finding the right balance between employee workflows, information "fluidity" and data security is still very much a work in progress.  When it comes to that sweet spot between increasing efficiency and keeping hackers at bay, compromises will be inevitable.

2. Given the experience with HIPAA, intrusive, unwieldy and (sometimes) obsolete laws and regulations are destined to grow. Get used to it, monitor it and manage as best you can.

Image from Wikipedia 

Tuesday, April 7, 2015

You Get What You Pay For in Cancer Care and Insurers Get What They Save With the Medical Home

The latest issue of Health Affairs is out and the Population Health Blog couldn't stay away. 

Three interesting articles:

The United States healthcare system has been criticized for spending too much of its treasure for too little in the way of outcomes.  Well, it's not that simple.  Stevens and colleagues in this just published Health Affairs study examined global cancer spending and found that increased spending on treatment correlated with drops in cancer mortality. From 1995 to 2007, the U.S. experienced a growth of $18,000 per cancer patient and dropped mortality among amenable cancers from 55 to 45 per 100,000.  Other than Japan and Finland (which benefit from already low levels of cancer plus sociodemographic factors like this and this), no other country has achieved that level of success.

In other words, you get what you pay for.  And when it comes to cancer, residents of the U.S. are not only paying, but getting a lot.

And speaking of payment, the same issue of Health Affairs has an article on multipayer medical home initiatives. The Population Health Blog didn't know this, but 17 of these initiatives have been launched since 2008.  Most were launched by states, not only because they controlled Medicaid's participation, but because they could blunt antitrust concerns. Challenges included agreeing on the criteria for provider participation, standardizing the payment models, and establishing criteria for success. What's more, the political landscape (health reform) and science (risk stratification, for example) has changed over the years. .

In other words, there is still no single approach to the medical home. When you've seen one statewide medical home initiative, you've seen one medical home initiative.

And speaking of initiatives, Geisinger's medical home program was also featured in Health Affairs. This observational study found that its care management nurses were independently associated with lower health care costs for as many as seven years.  That's good news.

But, the PHB knows that the Geisinger Health System is comprised of provider entities (such as its hospitals and the clinic) as well as a managed care insurance plan called Geisinger Health Plan (GHP). According to the article, "GHP hires, trains and manages the embedded case managers, partly because practices often lack resources to support such capabilities."

In other words, since.....

1) reducing health care costs will only benefit the holder of risk (the insurer) and

2) typical primary care settings lack the resources to change their approach to care,

....the real lesson of Geisinger's ProvenCare is that ownership of the medical home by commercial health insurers is an important option in assuring its success.

Wednesday, April 1, 2015

The Patient Centered Medical Home, Medicare's Comprehensive Primary Care Intiative and Cost Neutrality

Like this, but with snow
Oh my, he was really angry.

Back when the teenage Population Health Blog was living in New York, our family had a small garden tractor that was outfitted with a snowplow. After a particularly heavy snowfall, the PHB's father assigned the son the task of clearing the driveway. When the obliging PHB ran out of space to push the snow, its solution was to eschew use of a shovel and ram piles of snow outward by repeatedly backing up and accelerating forward in 4th gear. Teenage cries of "ramming speed!" seemed like a good idea at the time, but it really mangled the metal struts that held the plow to the front end of the tractor.

In economic terms, any savings the father achieved in outsourcing the snow removal was chewed up by hours of do-it-yourself blacksmithing that weekend. The driveway may have been cleared, but to the PHB father, the entire transaction ultimately ended up being a cost neutral bust.

Which brings CMS' Comprehensive Primary Care ("CPC") Initiative to mind. Thanks to the just-concluded Medical Home Summit, the PHB got to hear one of the authors of a CPC deep-dive analysis speak to the initiative's first-year findings.

 The entire report can be found here.

Very briefly, by October of 2012, CMS got Medicaid and 29 commercial health insurers to agree to ALL align and have everyone - including Medicare - to pay participating primary care sites a fee for Patient Centered Medical Home (PCMH) style care management.

 The rationale for this arrangement was to spare the clinics from having to offer the PCMH to only some of their patients. By imposing a "critical mass of payers" all patients had equal access to the same benefit.  That meant that practices wouldn't have to deal with the variations of different payer-dependent work flows and payment structures.

More than 500 practices (with an average of 4.4 providers) serving more than 2.5 million patients in 7 Medicare regions agreed to participate. In order to do that, the practices had to demonstrate that they had met meaningful-use criteria for their electronic health records (EHRs), had been officially recognized as a PCMH and had experience in quality improvement.

Once they were in the CPC, they were not only paid additional care management fees by CMS, but received quarterly feedback reports and technical assistance in achieving CMS mandated "milestones" (they can be found on page 84)  Over the course of the first year, practices received a median of $226,000 in care management fees.

At the end of one year, compared to propensity-matched non-CPC practices, CMS averaged $20 per beneficiary per month in care management fees.  They saved $14 per beneficiary per month in claims expense.  Compared to the non-participating sites, that $6 in additional cost did not achieve statistical significance.  Because the confidence intervals crossed $0, the conclusion was that CPC was cost neutral (the results can be found on page 120).  Some of the regions had statistically significant savings, while other regions had statistically significant losses.

The PHB's take:

Good thing the PHB father isn't in charge. 

This isn't the transformative PCMH break-through, and if CMS is looking to bend the cost curve, these one year results suggest Ms. Burwell et al are going to have to look elsewhere.

That being said, it's possible that years 2, 3 and 4 will show savings.  Even if that's true, the PHB wishes CMS and the health system "good luck" in being able to execute anything outside of fiscal year blocks of time.  We'll see.

The good news? The PHB suspects that the participating primary care sites ended up in the black.  They had already absorbed the costs of their EHRs and becoming PCMHs prior to the start of the initiative, so most of their $226,000 probably flowed right to their bottom lines.

As an aside, some of the $14 PBPM savings were attributed to a reduction in 30-day readmissions.  As the PHB understands it, CMS already has a methodology to claw that cost back from the health care system.  If that's true, the PCMH readmission savings are being double counted.

Image from Wikipedia