Why Medical Management Will Re-Emerge

Brian Klepper

Posted 7/31/12 on Medscape Connect’s Care and Cost

Several years ago I had dinner with a woman who had served in the late 1990s as the national Chief Medical Officer of a major health plan. At the time, she said, she had developed a strategic initiative that called for abandoning the plan’s utilization review and medical management efforts, which had produced heartburn and a backlash among both physicians and patients. Instead, the idea was to retrospectively analyze utilization to identify unnecessary care.

This was at the height of anti-managed care fervor. A popular movie at the time, As Good As It Gets, cast Helen Hunt as the mother of a sick kid. When someone mentioned an HMO, Ms. Hunt’s character let fly a flurry of expletives. America’s theater audiences exploded in applause.

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Medicare Physician Payment: The RUC’s Hollow Victory

Brian Klepper

Posted 5/18/12 on The Health Affairs Blog

On May 9th, William Nickerson, Senior Judge in the Southern Maryland Federal District Court, issued a 15 page ruling against the six Augusta, GA primary care physician plaintiffs who challenged HHS’ and CMS’ longstanding relationship with the American Medical Association’s Relative Value Scale Update Committee (RUC). The opinion did not weigh the substance of the case, but instead focused on a procedural provision in which Congress bars the judicial system from considering how the relative value units (RVUs) of medical services are determined. Judge Nickerson wrote:

Accepting as true that RUC plays a major role in the formation of the PFS [Physician Fee Schedule] and also accepting as true that this role unfairly skews the PFS toward certain medical professions and procedures, the Court, nonetheless, finds that Congress has precluded courts from reviewing, not only the final relative values and RVUs, but also the method by which those values and units are generated.

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Whatever It Is, It’s Not Insurance

Tom Emerick

Posted 5/9/12 on Cracking Health Costs

Discussions about covering “pre-existing” health conditions occur frequently among health policy people. One frequent thread is that health insurers should not be allowed to deny coverage to people with pre-existing health condition. After all, aren’t those the people who need health insurance the most?  Sounds reasonable, doesn’t it?  Problem is that proposition is really not reasonable.

Let me explain.  For any kind of insurance to work right, the “contingent event” can not have already happened before you buy it.  In life insurance, the contingent event is the death of the policyholder.  You can’t buy life “insurance” on someone who has already died.  For homeowners insurance, you can’t buy fire insurance after the home has burned.

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Sue the Patient

Dan Munro

Posted 4/27/12 on Forbes

States often confer the tax-exempt status on hospitals with the expectation that certainly some services will be extended to the less fortunate with limited capacity to pay. Two of the more litigious hospitals in North Carolina are Carolinas HealthCare and Wilkes Regional Medical Center in North Wilkesboro. They each filed over 12,000 lawsuits against patients in the same five-year period. One of the controlling entities – Carolinas HealthCare System – reported annual profits of more than $300 million over the last three years. One facility, Carolinas Medical Center-Mercy (CMC-Mercy) promotes itself as a “Planetree Designated Patient-Centered Hospital.” Planetree, Inc (itself a non-profit) offers tiered designations (Bronze, Silver and Gold) for “achievement in patient-/person-centered care based on evidence and standards.” The designation appears to be loosely based on an “application review fee” ($2,500 – $5,000) and includes a “self-assessment.” CMC-Mercy’s Gold Designation status is prominently featured on the hospital’s website:

CMC-Mercy – Planetree Gold Designation

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Barking Up the Wrong Tree: Affordability, Not Cost Growth, Is The Real Policy Challenge

Jeff Goldsmith

Posted 5/7/12 on The Health Affairs Blog

A recent spate of commentaries on the continuing health spending moderation raise an important policy question:  If the cost curve is well and truly bent, why are we investing so much of our policy energy on bending it further, when the more pressing problem is the declining percentage of Americans that can afford our health system’s astronomical costs?

Health spending the past two reported years (2009 and 2010) have grown in the high 3 percent range, the lowest growth rates since Dwight Eisenhower’s last year in office (1960), five years before Medicare.Medicare’s actuaries have pointed to the recession as a root cause.  Yet even Medicare spending growth has subsided to about 5 percent in 2010, a  development hard to attribute to recession since so few Medicare patients have first-dollar cost exposure. This analyst’s extensive industry contacts suggest no spending rebound in 2011 and 2012, despite an aging population and fee-for-service’s pernicious volume-increasing incentives in full force.

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Why US Health Costs are Higher Than Anywhere Else in the World

Jane Sarasohn-Kahn

Health Populi

The price of physician services, proliferation of clinical technology and the cost of obesity are the key drivers of higher health spending in the U.S., according to The Commonwealth Fund‘s latest analysis in their Issues of International Health Policytitled, Explaining High Health Care Spending in the United States: An International Comparison of Supply, Utilization, Prices, and Quality, published in May 2012.

The U.S. devotes 17.4% of the national economy to health spending, amounting to about $8,000 per person. The UK devotes about 10%, Germany 11.6%, France, 11.8%, Australia 8.7%, and Japan, 8.5%.

On the physician pay front, primary care doctors in the U.S. earn about $186,000 a year, compared with Australian colleagues who bring in about $92K a year, French peers at $96K per annum, Canadian PCPs earning $125,000, Germans at $131K, and British earning $160K.

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The Great Experiment

Paul Levy

If you read only one book about state and federal health care policy, it should be The Great Experiment: The States, the Feds and Your Healthcare.  Published by the Boston-based Pioneer Institute, it is the most articulate and rigorous presentation of issues that I have seen, a stark contrast from many papers, articles, and speeches that slide by as “informed debate” in Massachusetts and across the country.  I learned more about health care policy from this book than from anything else I have read in the last decade.

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A Health Affairs Study on Medicare Spending and the RUC

Chris Fleming

Posted 5/7/12 on the Health Affairs Blog

©2012 Health Affairs by Project HOPE – The People-to-People Health Foundation, Inc.

To calculate physicians’ fees under Medicare—which in turn influence private payers’ decisions on how they will pay doctors—the Centers for Medicare and Medicaid Services (CMS) relies on the recommendations of a controversial advisory panel known as the RUC (the Relative Value Update Committee), which mainly represents a broad group of national physicians’ organizations. In recent years physicians in primary care have expressed concerns that this committee has too little representation from their ranks and is partly responsible for increasing the pay gap between primary care providers and specialists. Other research has shown that increases in physician service prices brought about by committee recommendations contribute to increased costs of services used by Medicare enrollees.

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Flexibility Yields Employers Healthier Workforces

Jane Sarasohn-Kahn

Posted 5/2/12 on Health Populi

The most flexible workplaces are good for worker’s health: they yield the most engaged workforces, greater job satisfaction, increased commitment to the firm, better mental health and lower indicators of depression. But not all firms are all that flexible, which is the top line of the Family and Work Institute‘s 2012 National Study of Employers (NSE), funded by The Alfred P. Sloan Foundation.

What makes this survey different from others polling employers is that the NSE looks at the comprehensive array of total benefits offered to employees and their changing needs in terms of family, finance, and social lives.

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GOP Alternatives to ObamaCare

Joe Paduda

Posted 5/2/12 on Managed Care Matters

When it comes to health reform, perhaps the only thing Congressional Republicans agree on is they hate ObamaCare.

There’s no agreement on a basic framework much less consensus on an actual bill. Moreover, there are parts of ObamaCare that enjoy solid support amongst many Republicans, complicating the GOP’s efforts to develop an alternative without conceding political ground.

Their dilemma is certainly understandable; as anyone who followed the tortuous path of the PPACA (aka Obamacare), there was precious little consensus among the Democrats who passed the bill. While most had serious issues with various bits and pieces, they held their noses and voted “aye” when pressed.

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Women and Cardiovascular Disease: Disparities in Care

Kevin R. Campbell

Posted 4/29/12 on The Doctor Weighs In

Sudden Cardiac Death and cardiovascular disease is the number one killer of women in the US second only to ALL cancers COMBINED.  The prevalence of coronary artery disease in women is similar to that in age-matched cohorts of men– yet women tend to be under-served and under-treated.  When we look at specific interventions such as Percutaneous Coronary Interventions (PCI or coronary stenting) and Implantation of Implantable Cardioverter-Defibrillators (ICDs), and advanced devices for Congestive Heart Failure, we find that men tend to have more access to advanced therapies and are undergoing procedures at two to three times the rate of women.

Why is this?  Let me offer my two cents:

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More Information Is Not Always Better: Pulling Consumers Into Active Choices About Testing

Wendy Lynch

Posted 5/01/12 on the Altarum Institute’s Health Policy Forum

“I’m thinking of getting a full-body CT scan,” Jane said. “What do you think?” Here was a healthy, active 72-year-old with no specific symptoms considering an expensive screening test. When asked for a reason, she shared that strokes run in her family and a doctor told her that she might be able to see if there was a possible bulge in a blood vessel in her brain. Plus, while they were looking, the scan could see if there was some other problem.

When asked how it would affect her to know – do you think you would consider brain surgery if there was a problem? (probably not); what might you do differently if you knew? (I don’t know); do you know whether a bulge in her vessel would definitely cause a stroke? (not necessarily); she hadn’t really gone that far. She just thought she should know.

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The Decline and Potential Renaissance of Employer-Sponsored Health Benefits: EBRI and MetLife Reports Tell the Story

Two reports this week suggest countervailing trends for employer-sponsored health benefits: the erosion of the health benefit among companies, and opportunities for those progressive employers who choose to stay in the health benefit game.

In 2010, nearly 50% of workers under 65 years of age worked for firms that did not offer health benefits. The uber-trend, first, is that the percentage of workers covered by employer-sponsored health insurance has declined since 2002. Workers offered the option of buying into a health benefit, as well as the percent covered by a health plan, have both fallen, according to the Employee Benefits Research Institute (EBRI), an organization that has long-tracked this trend. EBRI’s report on Employment-Based Health Benefits: Trends in Access and Coverage, 1997-2010, provides the details behind this declining picture.

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Choosing Wisely or Vicely

Bradley Flansbaum

Posted 4/29/12 on The Hospitalist Leader

The press gave the Choosing Wisely initiative, unveiled several weeks ago, a great deal of attention.  Briefly, the ABIM foundation collaborated with Consumer Reports to produce Top 5 lists from nine specialty societies to identify “five tests or procedures commonly used in their field, whose necessity should be questioned and discussed.”  It is a first step to engage patients and physicians in the shapeless “national conversation” on (sensibly) rationing  that everyone speaks of, but never hears.  I write about it now, not just because this process is inevitable—which it is, but because the Society of Hospital Medicine is amongst the next group of eight to offer up recommendations.

Voluntary guidelines generally do not command attention.  One envisions this list of 2500+ much the same way we view our bedroom walk in closets.  The filled shoeboxes of yesteryear are there, but we will not open or utilize their contents again.  Knowing they are near though allows us to sleep better, a token consolation, but alas, they are memories.

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Anatomy of a Walletectomy

Merrill Goozner

Posted 4/25/12 on Gooz News

It all began when Dr. Renee Hsia of the University of California at San Francisco received a simple request from a good friend who had checked into a local hospital for an emergency appendectomy. The fairly routine procedure took place 19,368 times during 2009 in California.

After he returned home, he received a bill from the hospital for $19,000, his co-payment for the parts of the $54,000 operation that his insurance company didn’t cover. “He wanted to know if this was the usual and customary charge for a one-day stay in the hospital,” she recalled.

And thus began her research into pricing variability in the state, which was published this week in the Archives of Internal Medicine. The prices ranged from $1,529 to $182,955 with the median hospital charge of $33,611, the study showed.

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