CBO Rains More On the Health Reform Parade - The Letter to Senator Conrad

Egads.

First the Congressional Budget Office (CBO) letter sucking the life essence out of the Senate HELP Committee’s 'Affordable Health Choices Act,' and now this. Much like a college fraternity president going to the house-mom about the merits of establishing a 24-7 open beer tap in the living room, Senator Kent Conrad (D - North Dakota) asked the Congressional Budget Office (CBO) to weigh in on many of the favorite elements of Congress’ big plans for health reform. The June 16 reply is a far ranging and mostly qualitative assessment of the many reform ideas making the rounds and does an insightful job of discussing how extensive the need for change is.

Normally the Disease Management Care Blog would try to summarize and interpret Director Elmendorf’s letter to Senator Conrad, but the quotes directed at all those oft-cited and 'cost-saving' darlings of government-run healthcare are just too juicy to not share word for word. What’s more, the tone of the letter makes the DMCB wonder if the CBO staff has been reading its blog. Why not? They read its published papers.

On the Dartmouth Atlas:

‘Some studies have expressed skepticism about the Dartmouth researchers’ estimate. CBO’s own informal comparison of per capita Medicare spending in metropolitan areas controlling for both the health status of individuals and the prices of health care inputs, implies that the savings from turning medium- and high-spending areas into low-spending areas might be roughly half of the estimate by the Dartmouth researchers.' (The DMCB pointed this out back in December)

On Integrated Delivery Systems:

‘Examples of efficient care certainly exist today, with many individual health care providers and groups of providers offering both high quality and relatively low cost. Yet applying the methods of those efficient providers throughout the health care system cannot be accomplished through fiat or good intentions.’ (The DMCB has had its doubts about IDS' all along)

On pay for performance (P4P), bundled payments, no-pay for mistakes, gain sharing, cost sharing and decision support:

'Unfortunately, little reliable evidence exists about exactly how to implement those types of changes—especially at the level of specificity required for legislation.' (Er, we could also use some better evidence on why to implement many of these changes. An example is here)

On the Letter from AdvaMed, the AMA, AHA, AHIP, PhRMA and SEIU:

'Those stakeholders see increased efficiency as a critical goal of their organizations, and they agree that significant savings can be obtained. At the same time, many of the group’s proposals offer little detail about the specific changes necessary to achieve those objectives or the obstacles to their making the changes.' (So said the DMCB here)

On Accountable Health Care Organizations:

'(Based on results from the Physician Group Practice Demo)… the evidence for cost savings is mixed. Moreover, expanding this approach to physicians who are not already in an integrated system and may be reluctant to join one raises further issues. For example, challenges arise when trying to design programs that are voluntary for both enrollees and physicians, because both parties would generally need to expect some gain in order to participate—often at the government’s expense.' (Hear hear!)

On Comparative Effectiveness Research

'Merely conducting and disseminating additional research is unlikely to have major effects on patterns of clinical practice or health care spending, however. For new research to have a significant impact, providers’ financial incentives would need to be aligned with the results…… Further challenges in reaping net savings from comparative effectiveness research arise from the cost of the research itself and from the lags in getting research under way, developing results (particularly if they depend on new clinical trials) and disseminating the findings.' (Indeed!)

On Prevention:

'Several factors make preventive care less broadly effective at reducing health care spending than might be expected. For some preventive services, clinical evidence on effectiveness is lacking: In its 2006 review of such evidence, the U.S. Preventive Services Task Force was neutral toward—neither recommending nor discouraging the use of—approximately 40 percent of the services it reviewed because of a lack of evidence.' (The DMCB tackled the topic here, but wasn't aware of the extent of the USPSTF's skepticism).

On More Primary Care Providers:

'One study of the relationship between Medicare spending and the composition of the workforce of physicians found that, with the total number of physicians held constant, states with more general practitioners had lower spending. Achieving that outcome, however, involves reducing the number of specialists in line with increasing the number of primary care physicians, and the mechanism for accomplishing that change (for example, the appropriate adjustments in payment policies) is unclear. Savings would be less likely if the number of specialists remained the same while the number of primary care physicians increased.' (DMCB never considered this possibility. Wow)

On Health Information Technology:

'Some experts maintain that increased use of information technology and a new focus on efficiency will yield substantial productivity gains in the health sector. Some of those gains may appear as reductions in the quantity of services and thus yield savings automatically for the government. However, most of the gains are likely to take the form of reduced costs per service, which would cut government spending only if the government cut the prices it pays (and otherwise would end up boosting providers’ profit margins).' (The DMCB has been a refugee from the EHR, but kept a sense of humor about it. But this is a great point by CBO: essentially, any efficiency gains are unlikely to be passed back to the payers).

Maybe in addition to reading some blogs, CBO's been getting its inspiration from watching youtube: