NBGH Annual Survey: Consumer Driven Plans, Private Exchanges and Seven-Percent

By Clive Riddle, September 6, 2013

The National Business Group on Health recently released findings from their annual benefits survey addressing plan design and cost issues for 2014. What did they conclude after getting results from 108 large employer organizations? The cost of providing health benefits will rise 7% (third consecutive year projected at that  rate); employers continue to further embrace consumer driven plans; and there is potential interest in exchanges – particularly private exchanges.

Regarding consumer driven care:

• 36% of respondents said consumer driven plans were the most effective tactic to control rising costs
• 72% offer at least one CDHP
• 22% planning to implement a total replacement CDHP next year, up from 19% this year

Meanwhile, NBGH President Helen Darling tells us “Private exchanges are another option some employers are considering. In the last year, there has been an increase in the number of private exchanges that are being launched. And while some employers are considering private exchanges for active employees sometime in the future, very few (3%) are considering eliminating health care coverage entirely,” said Darling.

41% responded that COBRA participants might find public exchanges to be the most cost effective option. 26% felt some pre-65 retirees might opt to join exchanges, while 20% believe that some part-time employees will do so.

The survey also covered these topics:

• 44% currently have an on-site clinic in at least one of their locations, with 9% are expecting to build a clinic next year
• 66% will cover surgical interventions for the treatment of severe obesity in 2014
• 36% will cover FDA-approved medications and intensive, multi-component behavioral interventions for participants with a BMI of more than 30
• 89% offer a tobacco cessation program
• 77% offer telephonic or on-site health coaching
• 55% offer on-site weight management programs
• 88% conduct health assessments
• 83% do biometric screenings

The Context of Y2K for Healthcare: 1999 vs. 2013

By Clive Riddle, August 22, 2013

I was surprised to see this headline pop up in my email – Will health insurance exchange launches be the 'next Y2K'? from an article in the August 12, 2013 issue of FierceHealthIT.  Intrigued, I clicked to find the article subheader warning that “Some computer experts warn of possibility of system overload.”

Further intrigued, I started googling Y2K and Health Insurance Exchanges.  On the same day, Benefitspro ran this article: IT threatens exchange enrollment which reported that “at this summer’s Colorado State Association of Health Underwriters’ annual symposium in Denver, one speaker warned the exchange launch could be the “next Y2K” — millions of Americans logging on in October might overwhelm the exchanges.”

Just below that, my search results displayed:  Y2K All Over Again. Can the Insurance Marketplaces Handle Opening Day? from the  Navix Blog (an on-line insurance brokerage company ) posted on August 5^th.

My bemusement connected with these analogies? Their references to Y2K were in the 1999 context – warning us of all the monumental problems that would unfold after the event.  The correct post-Y2K context of using the term Y2K would seem to be, referring  all the preparation that is involved for such an undertaking, not the aftermath (which by the way didn’t bring about a zombie apocalypse or the crash of modern society as we know it.)

So I googled on – there wasn’t a preponderance of current health insurance exchange references, but there were a number of references to the ICD-10 conversion and Y2K, such as Deadline ICD-10: Y2K all over again? from Health Management Technology in December 2010 and more recently - Schools beef up medical coder ranks before ‘Y2K of health care’ from the South Florida Business Journal, on February 15, 2013. All in all there were 8,120 google search results for ICD-10 combined with Y2K. But in this case, the articles mostly seemed to get the context right – the emphasis was on preparation.

Then I found where the references started crawling out of the woodwork: with the more broad-brush of Obamacare.  A whopping 1,110,000 google search results were yielded with Obamacare combined with Y2K. The specifics of these articles were all over the map: Obamacare's Y2K: Coverage for pre-existing conditions and Y2K was a Breeze Compared to State IT Prep for ObamaCare for example. The context for use of Y2K (maybe for Obamacare we could call it YOb) was a mixed bag. But the 1999 context was way too prevalent in the limited click-thrus I browsed – with a common denominator being that the political oriented rants seemed to get it wrong the most. 

Engaging Your Audience with Content Marketing

By Claire Thayer, August 15, 2013

Content marketing offers a fresh approach for engaging with your audience in a manner that’s both subtle and thoughtful.  Think: videos, infographics, white papers, survey results, articles, case studies, and webinars as tactics to educate current and prospective customers about your business solutions.

According to an infographic posted this week on Social Media Today, 72% of B2B marketers use content marketing as part of their overall marketing strategy, with more than half rating videos as the most effective content marketing tactic – see B2B Marketing Strategies for 2013 and Beyond. 

This soft sales approach to marketing is quite effective in generating leads, along with increasing overall awareness about your company in terms of brand identity and thought leadership.  Check out these white papers and videos as well as info about our sponsored webinars for some ideas on marketing your content. In addition, while not specifically health care focused, some key takeaways can be gleaned from this article: How To Make Content Marketing Work for Your Business as well as from this short video: 50 Stats You Need to Know About Content Marketing from NewsCred.

Gorillas in Our Midst

By Kim Bellard, August 13, 2013

There’s a well-known psychology experiment in which participants were asked to keep track of how many times a basketball was being passed in front of them, only to have a (fake) gorilla stroll in front of them.  Surprisingly, about half of the participants were so focused on their task that they were totally oblivious to the gorilla’s presence.  Researchers call this “inattentional blindness,” and we now have some evidence that it happens even to trained health care professionals as well.

Researcher Trafton Drew recently published results of a study in which he and his colleagues placed an image of a gorilla – I swear, I am not making this up! -- in one of a series of slides radiologists were reviewing for cancer nodules.  Amazingly, 83% of the radiologists failed to detect the image, even though it was 48 times larger than the typical nodule they were looking for and eye tracking indicated the radiologists had looked directly at the image.  They weren’t looking for gorillas and, as a result, did not see them. 

“Inattentional blindness” seems to me an apt description of how those of us in the health care field tend to look at health care.  It’s the old “if the only tool you have is a hammer, then everything looks like a nail” syndrome and it may help account for why our health system is so dysfunctional.  Health care has a lot of hammers and we sure do like to use them.

Take health insurance.  Health insurers are notoriously low rated when it comes to consumer trust, and it’s no wonder: consumers don’t understand their product.  Recent research by George Lowenstein of CMU indicate that only 14% of consumers understand four basic terms – deductible, copay, coinsurance, and out-of-pocket maximum – and only 11% could estimate their cost for a hospital stay given all the applicable data. 

I worked a long time in the health insurance industry and like to think I’d do well on Dr. Lowenstein’s tests, but when it comes down to reading all the fine print from different companies I suspect I’d not know how to evaluate them either.  We’ve simply made coverage too complicated, and if anyone thinks the new health insurance marketplaces will solve this problem, then I suggest they think again. 

It’s all well and good that ACA dictates which preventive services are covered at 100%, what “essential benefits” are, and how much different levels of plans must pay out, but none of that is making health insurance understandable to the average consumer.  We’re so busy debating things like high deductible plans versus first dollar plans, single payor versus competing private plans that we ignore the real problem: not only don’t consumers understand the product but, even worse, the product fails to help them be healthy.

Or take hospitals.  Let’s say you were very sick but had no idea what a hospital was.  Your friend tells you they are where sick people go to get better.  As a result, they’re full of sick people; in fact, it’s more likely than not that you’ll have to share a room with some sick stranger.  All those sick people means lots of germs; the official statistic is that one in 20 patients will pick up an infection during their stay (which is almost certainly understated) and that about 100,000 will die from those each year (which hopefully is overstated).  Part of the problem is that hospitals can’t even do a good job of getting their employees to do simple hygiene tasks like washing their hands. 

When you arrive, you’ll have to fill out lots of forms, giving them information that you no doubt have already given to other health care professionals.  The hospital will expect you to wear a flimsy gown that affords no dignity, and stick a wristband on you like you are a piece of merchandise, which is supposed to lessen the chance that they’ll, say, remove one of your limbs or a kidney by mistake.  An array of different hospital personnel will keep interrupting you for a variety of tests, procedures, and other tasks, virtually none of which you’ll have much advance warning of when to expect and which will make sleeping or resting very difficult.  You’ll spend most of your time in the hospital waiting around, but don’t expect much in the way of good distractions: the food is bland at best and terrible at worst, and the entertainment options on the television might have been state-of-the-art for 1970’s cable. 

Don’t bother trying to find out what anything is going to cost; no one can tell you until long after the fact, and then you’ll be shocked at how expensive everything is – at prices that would make even the most hardened Pentagon procurement officer blanch.  Oh, and there’s a one in five chance that you’ll have to be readmitted within 30 days, either because you didn’t really get better during your stay or because something else bad happened to you when you were there. 

If you learned all this for the first time, you might think twice about being admitted.

Hospitals have been around in some form for centuries, but they didn’t really start turning into these impersonal behemoths until federal money started pouring in after World War II, first with Hill-Burton funds and then with the introduction of Medicare and Medicaid.  The trend has accelerated in recent years.  Hospital buildings have often grown very complex due to repeated expansion and renovation, to the point that visitors need color coded maps just to try to get around.  The equipment in the hospitals, down to the beds themselves, has grown equally complex – and expensive.   Hospitals can certainly help patients in ways that would have been unimaginable even twenty or thirty years ago, but I doubt there are many people who could assert that the hospital experience has improved.

It’s not that smart people aren’t thinking about this.  Take, for example, Patient Room 2020, led by design firm NXT Health in conjunction with Clemson’s Healthcare + Architecture Program, and funded by the Department of Defense.  They’re reimagining what patient rooms should look like and work, and have come up with some cool design changes (see, for example, more pictures in Wired’s article).  As Wired said, it’s like the Apple Store meets Tron (although I think I’d have chosen a better sci-fi movie – or at least one that had a medical facility in it). 

The trouble is, they’re not seeing the metaphorical gorilla.  It’s the concept of the hospital that we’re not seeing properly.  It’s sort of like Windows 8 – some impressive engineering that provides expanded capabilities, but at the end of the day still a kludge trying to maintain an approach that is quickly becoming bypassed by newer ones. 

To carry the analogy further, hospitals and health insurers would surely be the mainframes of the health system, with outpatient clinics and surgical centers perhaps the desktops.  Physician offices and perhaps physical therapy offices might be considered the laptops.  In this analogy – where are the equivalents of tablets and smartphones, and where are the “apps” that make using the system easier?  Again, I mean these as an analogy, not literally, to illustrate that we’re just not doing a good job of rethinking the system.

Just look at all the artificial distinctions that have ossified in our health system: allopathic versus osteopathic (or chiropractic); “Western” versus alternative medicine; primary care versus specialty versus subspecialty; dental versus vision versus medical; workers compensation health coverage versus “commercial” health insurance; state by state licensing of health care professionals and insurance.  I could go on and on, but it’s clear that there are a lot of gorillas that we’re missing with our inattentional blindness. 

For example, a recent study found that one in ten Americans now take an antidepressant.  The problem is, nearly two-thirds of them don’t meet the criteria for depression and probably shouldn’t be taking the prescription.  Both the patients and the prescribing physicians are guilty of going for the medication fix because that’s what they’ve been conditioned to look for.

We need to go back to first principles.  What are the structures we need to encourage and incent consumers to focus more on good health?  What are the types of professionals and support systems that can assist them in that ongoing journey?  How do we better identify when health issues turn into medical problems, and apply the “least necessary” resources to them?  How do we keep the patient in the center even as care becomes more complex?  How much should consumers be expected to pay towards their own health, and how do we want to finance those costs?  Answering these questions from first principles would be monumentally hard, but right now there are not many people even trying.

We’re so busy seeing tests/procedures/pills/payment that we’re missing, not the gorilla, but the patient.

Ten things to know about 2013 Health Savings Account Data

By Clive Riddle, August 9, 2013

Devenir has just released their 2013 HSA Research report. The survey data was collected in July 2013 and primarily consisted of the top 50 HSA providers in the health savings account market, with all data being collected for the June 30th, 2013 period.  The six page executive summary provides some great, concise data, which includes these ten takeaways:

1. The total number of HSA accounts rose to more than 9.1 million with assets totaling nearly $18.1 billion.
2. This represents a year over year increase of 29% for both accounts and assets for the period of June 30th, 2012 to June 30th, 2013.
3. The average account balance halfway through 2013 grew to $1,981 from $1,879 at the end 2012, over a 5% increase.
4. When you eliminate identified zero balance accounts that average rises to $2,228, an almost 3% year over year increase.
5. Current average account balances by the year the account was opened range from $5,117 for accounts opened in 2005 to $1,192 for accounts opened in 2012 (and $775 for accounts opened this year to date).
6. Total contributions to HSA accounts from June 2012 to June 2013 are estimated to have reached $16.7 billion, with accountholders retaining about 23% of those contributions.
7. Debit cards represent 74% of all withdrawal transactions, with an average of 5.1 annual debit card withdrawals per account for an average $124.48 per transaction.
8. Currently 14% of HSA assets are comprised of investments .
9. HSA investment assets reached an estimated $2 billion in June, up 14% from the end of 2012 and 26% year over year. The average investment account holder has a $10,484 average total balance (deposit and investment account).
10. Devenir projects that year-end 2013 assets will total $20 billion, and 2015 HSA assets will reach $29.3 B, comprised of $4.2B in investments, and $25.2B in deposits.

I only wish our family’s HSA account balance was followed by a capital “B” as well.

Making sense of Big Data

By Claire Thayer, August 5, 2013

A recent article on big data published McKinsey & Company, The big-data revolution in US health care: Accelerating value and innovation, finds that many innovative US health-care data applications are moving beyond retroactive reporting to interventions and predictive capabilities.  Since 2010, more than 200 new businesses have developed innovative health-care applications. About 40 percent of these were aimed at direct health interventions or predictive capabilities.

Last week, Optum published a two-part series on big data.  Don James, Director of Product Management, Risk Adjustment Solutions at Optum, suggests that a comprehensive analytics approach presents a framework for helping health plans to clinically evaluate members, collaborate with providers more strategically, and apply models to help gauge the impact of efforts to improve clinical effectiveness.  In this series,  Optum identifies three steps in developing an analytics’ approach: (1) access data sources; (2) aggregate and stratify the data; and (3) model the data.  Step 1, access data sources, is addressed in Living the Promise of Big Data Part I while steps two and three are specifically addressed in Living the Promise of Big Data Part II. 

Cutting edge predictive analytics and health care trends are highlighted each month in Predictive Modeling News, published by Health Policy Publishing.  The August 2013 edition, released today, features a lead article addressing predictive analytics in health care -- view page one of this issue here.  Additionally, here are a few big-data in health care related videos that are available for free on MCOL’s HealthShareTV site:

• Improving Health care Through Big Data
• The surprising seeds of a big-data revolution in health care
• Using Data Mining & Analytics to Proactively Manage Emergency Room
• Finding Meaning in Numbers: Using Big Data to Transform Your Health Care Benefits

PhRMA’s Consumer Health Survey: Honest Answers Indicate a Long Ways to Go

By Clive Riddle, August 2, 2013

The Pharmaceutical Research and Manufacturers of America (PhRMA) – just released findings from their new annual “From Hope to Cures” survey, which “explores Americans’ attitudes on personal health and medical concerns.”  What did PhRMA have to say about their new report?  President John J. Castellani, tells us "a patient-centric dialogue is crucial to improving health outcomes. The Health Survey findings will help also inform efforts to address major health challenges such as chronic disease, improved prevention and wellness activities and enhanced patient adherence to prescribed therapies.”

What do I get out of the report? The respondents were surprisingly honest (in many surveys consumers tend to rate themselves more on top of their health behaviors.) Large percentages don’t seem to be as engaged as some other studies have led us to believe.

58% say there are paying more attention to their health compared to a few years ago. This means 42% of consumers are not stepping up their game.  Here’s the depressing part – consider these percentage who said they are paying more attention to these health behaviors:

• 57% - eating a healthy diet
• 54% - maintaining a healthy weight
• 48% - reducing stress
• 41% - exercising regularly
• 37% - taking medicine as prescribed
• 37% - getting plenty of sleep
• 35% - seeing doctor regularly
• 33% - monitoring blood pressure
• 23% - moderating alcohol

Okay – so if over 40% are NOT paying more attention to their diet or weight, and well over 50% are NOT paying more attention to the other above listed behaviors, the must be because they are in pretty good shape already, so they don’t need to pay even more attention – right?

So, when asked to describe their health for the year, these percentages responded good or great:

• age 18-34 - 71%
• age 35-49 - 61%
• age 50-64 - 53%
• age 65+    - 56%
• overall       - 61%

So almost 30% in the prime of their life say their health isn’t good, and almost half above age 50 say the same. Wouldn’t that be cause for large numbers to be paying more attention to some of these health issues?

The survey covered a number of other topics, which were probably of bigger concern to PhRMA in tying consumer perceptions to their mission, but the above disconnect with consumer engagement is what engaged me.

It Was Those Other Guys

Kim Bellard, July 26, 2013

A fascinating study in JAMA on physician’s attitudes towards controlling costs helps illustrate the bipolar attitudes our health system tends to generate.  The study found that physicians generally believe other players in the health system have the major responsibility for controlling costs – led by the popular culprits: trial lawyers (60%), insurance companies (59%), and pharmaceutical/device manufacturers (56%).  Patients were cited by 52%.

Only 36% of the physicians cited physicians as bearing a major responsibility for controlling costs.

When I saw the latter result, I initially assumed the respondents would simply plead ignorance about costs, or at least take the 5^th, but nope: 76% agreed that they were aware of the costs of services they recommend.  Even more surprising, 73% disagree that doctors are too busy to worry about costs of tests and procedures, and 75% agree that trying to contain costs was every physician’s responsibility.  There’s a certain cognitive dissonance here that is hard to understand.

As for cost containment strategies the physicians were enthusiastic about, mom-and-apple-pie approaches dominated: promoting continuity of care (75%), the ever-popular “rooting out fraud and abuse” (70%), and chronic disease care coordination (69%).  Only 7% were in favor of eliminating fee-for-service and only 6% liked the approach of bundled payments.  I guess they haven’t gotten the memo that FFS is supposedly dying.

I was particularly disappointed that the physicians were not more enthusiastic about more empirical approaches to controlling costs, with only 51% in support of expanding access to quality and safety data and only 50% supporting head-to-head trials of competing treatments. 

Support for head-to-head trials should be much higher, based on some findings recently released by the Mayo Clinic.  The researchers reviewed ten years of articles in a “high impact” medical journal, looking both at articles studying new medical practices and ones evaluating existing treatments.  The results are disturbing: 40% of the existing treatments reviewed were no better or worse than the prior standards of care; i.e., the results recommended reversing an existing practice that was considered the current standard of care.  Only 38% reaffirmed existing practices, with the rest inconclusive.  This is medicine by ready-shoot-aim.

New treatments fared better, with only 17% failing to improve upon existing practices.  I suppose I should be comforted by that result, but it just makes me wonder if the discredited practices ended up being used anyway (especially if they resulted in higher revenue).  

Another recent survey of physicians – this one by Wolters Kluwer Health – didn’t paint a better picture than the JAMA study.  For one thing, 34% reported that it was somewhat or very likely that they’d leave their practice in the near future.  The respondents found it challenging to manage shifting reimbursement models with payors (91%) as well as their practice’s financial management (90%); as a result, 88% reported it challenging to spend enough time with patients.  Improving patient care was seen as further down their list of challenges (78%, but with the lowest result for being seen as very challenging -- only 20%). 

These physicians do think that HIT is making progress in having an impact on ensuring patient safety and in improving quality of care (both 55%), but are more skeptical that it is making progress in improving ease of use (56% disagree) or managing costs (63%). 

In terms of areas of focus for the next 3-5 years, 48% listed improving practice efficiency, 34% planned to explore different business models, while only 14% were focused on public reporting of quality metrics and only 11% wanted to concentrate on patient safety.  To be fair, 31% did hope to adopt technology to improve clinical decision-making/evidence-based medicine. 

One likes to think that it truly isn’t all about the money, but it’s also easy to be cynical about this.  The Washington Post recently wrote about how an AMA committee is driving Medicare reimbursement decisions, using some questionable assumptions.  The Post asserts that some of the committee’s assumptions grossly exaggerate the time involved in procedures, such as for colonoscopies.   The assumptions can be as 100% higher than actual time and effort. 

The Post also notes that the committee is seven times more likely to raise time estimates than to lower them, in apparent contradiction to presumed technology and productivity advances.  Despite the billions of dollars at stake, CMS only uses “six to eight” people to review the recommendations, and none of them are devoted full-time, in contrast to the “hundreds” of people the AMA and specialty societies use to develop their recommendations.

Former Medicare chief Tom Scully is quoted as saying, “The concept of having the AMA run the process of fixing prices for Medicare was crazy from the beginning.  It was a fundamental mistake.”  The Harvard researcher who originally developed the RBRVS point system, William Hsiao, says, “The AMA fought very hard to take over this updating process.  I said this had to be done by an impartial group of people.  This is highly political.”

The AMA committee’s recommendations do not directly result in higher payments, nor is it likely that most individual physicians are aware of the assumptions embedded in their payment rates, but the process is another illustration at how no one is minding the store.

I would be remiss if I failed to mention the IOM’s new report “Variation in Health Care Spending: Target Decision Making, Not Geography.”  They were asked to investigate since Congress has been considering shifting money from high-cost areas of the country to lower cost ones.  Somewhat surprisingly, IOM did not support that tactic.  They reaffirmed that geographic spending differences do exist, for both Medicare and private insurance, and that there is essentially no correlation between quality and spending.  However, they did not support geography-based reimbursement models, finding that the geography is not the issue.

For Medicare, they found that higher spending differences were most associated with post-acute care, and to acute care only to a lesser extent; indeed, post-acute care differences accounted for 73% of Medicare’s geographic spending differences.  For private insurance, spending differences were due to price markups rather than utilization differences.

The IOM’s main conclusion is in the subhead of their report’s title: “Target Decision Making, Not Geography.”  Now if only we could figure out who is making the decisions.   The physicians don’t think it’s them; the government is delegating theirs to special interests and lobbyists; the payors can’t negotiate tough enough with the provider systems (especially now that those systems continue to consolidate); the provider systems – well, they’re terrified that the physicians will stop generating all that revenue for them. 

We can continue to pin the tail on new culprits, but we need to get past blame.  I’m naïve enough to think that there aren’t many villains here (although there are, allegedly, some), but it boils down to too many involved parties not being willing to be accountable for their actions.

When it comes to increasing value – not just controlling health care costs but also improving quality – in our health care system, I think of words of the always wise Benjamin Franklin: we must all hang together, or assuredly we shall all hang separately.

10 Key Trends Shaping the mHealth market until 2017

By Claire Thayer, July 24, 2013

This week, Research and Markets announced the release of their newest report, Mobile Health Trends and Figures 2013-2017. Those of you following mHealth trends won’t be surprised to see predictions that the mHealth market will develop in line with the smartphone application market. According to the press release, five years from now, the mHealth market will be a mass market with a reach of billions of smartphone and tablet users. By that time, 50% of these users will have downloaded mHealth applications.  Further, by the end of 2017, the total mHealth market revenue will have grown by 61%.  The main sources of revenue will not come from application download revenue itself, but from mHealth services and hardware sales. This new report shows that the market for mobile health application will develop along the following trends:

1. Smartphone user penetration will be the main driver for the mHealth uptake
2. mHealth applications will be tailored specifically for smartphones or tablets
3. mHealth applications will be native rather than web-based applications
4. mHealth niche stores will become the home of the 2nd generation of mHealth apps
5. Missing regulations are the main market barrier during the commercialization phase
6. Buyers will continue to drive the market
7. Applications will enter traditional health distribution channels
8. mHealth market will grow mainly in countries with high Smartphone penetration and health expenditure
9. 2nd generation mHealth applications will focus on chronic diseases
10. mHealth business models will broaden 

The complete report also provides a detailed outlook on future market size and revenue models for mhealth growth trends.  Looking for resource on mobile apps for healthcare?  Check out MCOL’s mhealthshare site, the home for mobile health app information. Visit regularly to keep current on mobile health app developments with health plans, hospitals, medical groups, government, solutions providers and other healthcare business stakeholders. mhealthshare publishes a periodic e-newsletter that features an mhealth factoid, quote, news items, video, blogs, and lists for all the latest happenings for mobile healthcare apps.  View the current edition here, or better yet, sign up for a free subscription to receive periodic editions of the e-newsletter.

CMS Pronouncements on Pioneer ACO Results and 2014 HIX Premiums

By Clive Riddle, July 18, 2013

This week CMS announced results from the first performance year of the Pioneer Accountable Care Organization (ACO) Model, along with a new report that finds premiums in the Health Insurance Marketplace will be nearly 20 percent lower in 2014 than previously expected.

Here are the Pioneer ACO results that CMS is touting:

• Costs for the more than 669,000 beneficiaries aligned to Pioneer ACOs grew by only 0.3 percent in 2012 where as costs for similar beneficiaries grew by 0.8 percent in the same period.
• 13 out of 32 pioneer ACOs produced shared savings with CMS, generating a gross savings of $87.6 million in 2012 and saving nearly $33 million for Medicare
•  Pioneer ACOs earned over $76 million in compensation.
• Only 2 Pioneer ACOs had shared losses totaling approximately $4.0 million.
• All 32 Pioneer ACOs successfully reported quality measures and achieved the maximum reporting rate for the first performance year, with all earning incentive payments. 
• Overall, Pioneer ACOs performed better than published rates in fee-for-service Medicare for all 15 clinical quality measures for which comparable data are available.
• 25 of 32 Pioneer ACOs generated lower risk-adjusted readmission rates for their aligned beneficiaries than the benchmark rate for all Medicare fee-for-service beneficiaries.
• The median rate among Pioneer ACOs on blood pressure control among beneficiaries with diabetes was 68 percent compared to the comparison value of 55 percent as measured in adult diabetic population in 10 managed care plans across 7 states from 2000 to 2001. 
•  Pioneer ACOs performed better on clinical quality measures that assess low density lipoprotein (LDL) control for patients with diabetes. The median rate among Pioneer ACOs for LDO control among beneficiaries with diabetes was 57 percent compared to 48 percent in an adult diabetic population in 10 managed care plans across 7 states from 2000 to 2001.
• Pioneer ACOs were rated higher by ACO beneficiaries on all four patient experience measures relative to the 2011 Medicare fee-for-service results.

CMS did disclose that seven Pioneer ACOs that did not produce savings intend to switch to the Medicare Shared Savings Program, and two Pioneer ACOs have indicated their intent to leave the program. 

The Wall Street Journal  didn’t interpret these results as rosily as did CMS. Here is the WSJ take, from their July 16^th article Mixed Results in Health Pilot Plan: “All of the 32 health systems in the so-called Pioneer Accountable Care Organization program improved patient care on quality measures such as cancer screenings and controlling blood pressure, according to data to be released Tuesday by the Centers for Medicare and Medicaid Services. But only 18 of the 32 managed to lower costs for the Medicare patients they treated—a major goal of the effort. Two hospitals lost money on the program in the first year. Seven have notified CMS that they intend to move to another program where they will face less financial risk. Two others have indicated they intend to leave the program,”

On the Health Insurance Marketplace front, CMS touted findings from a just released twelve-page ASPE Issue Brief: Market Competition Works: Proposed Silver Premiums in the 2014 Individual and Small

Group Markets Are Nearly 20% Lower than Expected. CMS notes the report found that:

• In the 11 states (including the District of Columbia) that have made information available for the individual market, proposed premiums for 2014 are on average 18 percent lower than HHS’ estimate of 2014 individual market premiums derived from CBO publications.
• In the six states that have made information available in the small group market, proposed premiums are estimated to be on average 18 percent lower than the premium a small employer would pay for similar coverage without the Affordable Care Act.
• Preliminary premiums appear to be affordable even for young men. For example, in Los Angeles - the county with the largest number of uninsured Americans in the nation - the lowest cost silver plan in 2014 for a 25-year-old individual costs $174 per month without a tax credit, $34 per month for an individual whose income is $17,235, and a catastrophic plan can be purchased for $117 per month for an individual.

Here a chart provided in the ASPE report, comparing the ASPE premium estimate for Individual Silver premiums compared to actual premiums for applicable states:

Keeping up on Healthcare Reform Requirements

By Claire Thayer, July 15, 2013

By now, many of you have heard the news that The Obama administration announced a one-year delay, until January 1, 2015 in the implementation of the employer mandate in the Affordable Care Act (ACA) for employers with more than 50 full-time equivalent employees provide health care coverage to their full-time employees. Interesting timing, given that according to PwC US's latest Trendsetter Barometer survey, the majority of private companies (56 percent) say they're already in compliance with the upcoming provisions.  Additionally, the PwC survey finds that overall, most private companies (72 percent) consider themselves prepared for the ACA's next wave of requirements. Work remains to be done, however ― only 35 percent of private companies say they are well prepared.  Also, nearly three-fourths (74 percent) of private companies that have 50 or more employees say their healthcare coverage meets the ACA definition of affordability. Complete findings from this survey are here:

PwC Survey: Majority of private companies already in compliance with next wave of healthcare reform requirements. MCOL’s Health Change Bulletin is a free, weekly e-newsletter for health care professionals following health care change and reform initiatives, developments, discussion, and implications, from a variety of perspectives. We encourage you to subscribe to the Health Change Bulletin to keep up on highlights of all the latest health care reform developments!!

That’s Too Hard – Never Mind…

By Kim Bellard, July 9, 2013

I really didn’t want to pile on the Administration for its fumbled implementation of the Affordable Care Act (ACA – that’s ObamaCare to all the haters), -- I’d much rather be reporting on cool new innovations in health care -- but recent setbacks just boggle the imagination. 

Last week was a slow news week due to the mid-week 4^th of July holiday, and the Obama Administration used that opportunity to drop two implementation bombshells.  First, on Tuesday they announced that they were delaying the mandate that employers with 50 or more employees provide insurance to their employees, or pay fines, until 2015.  They cited the difficulty in developing the necessary reporting requirements and associated mechanisms, even though they’ve had over three years to work on these. 

Many businesses and their trade associations applauded the delay, although many had already been working hard on how they would comply with the law.  And, of course, the vast majority of such employers already provide health insurance to their employees. 

Cynics immediately pointed out that the delay put the mandate after the 2014 mid-term elections.  Other pundits immediately questioned how the health insurance marketplaces (a.k.a “exchanges”) would know who qualified for the subsidies without those employer reporting mechanisms, and later that week the other shoe dropped.  On the dead news day of late Friday afternoon, the Administration said they wouldn’t bother verifying eligibility, and would just trust consumers’ self-reported income and other information. 

These subsidies are literally thousands of dollars per family per year, mind you.  No one who has ever applied for any other kind of federal money would recognize this kind of leniency.  This relaxation of the requirements is again positioned as simply a delay, while they work on the associated systems, but again – what has been going on the past three years?

Not surprisingly, conservative organizations, such as the editorial board of the Wall Street Journal, Fox News or House Republicans have been all over this.  Critics note that these are not the first ACA provisions delayed or waived; for example, they’d previously delayed giving multiple plan options to employees working for small employers who buy coverage through the marketplaces, and killed the CLASS long term care program altogether. 

One can’t entirely blame the Administration for it, but even aside from these latest fumbles, but let’s keep in mind that, according to AP estimates, 2 out of 3 people that ACA intended to cover under its Medicaid expansion not only won’t get Medicaid but can’t qualify for the marketplace subsidies either.  Over half of the states have not elected to approve the expansion.  Between them, Texas and Florida alone have 3 million such uninsured low income people.  Similarly, over half the states are not implementing their own health insurance marketplaces either, creating much more work than intended for the federal government. 

Speaking of blunders, don’t even get me started on the Administration’s “compromise” rules on contraception coverage for faith-based organizations, with the contraception-only coverage to be offered to employees by insurers or third party administrators.  Even Rube Goldberg would know that approach isn’t going to work.

As if enough canaries haven’t died in the coal mine already, as many as nine of the pioneer Accountable Care Organizations – the centerpiece of ACA’s approach to controlling costs – look like they may drop out of that program, shifting to a no risk model. 

I did a quick search on “ObamaCare train wreck” and got almost 2,000,000 results.  That phrase has quickly become the standard ObamaCare description, after Senator Max Baucus started that metaphor rolling earlier this year.  And he’s an ACA supporter.

ACA did three things that our health system badly needed: assuring everyone can qualify for coverage, regardless of health status; making every poor person eligible for Medicaid; financially assisting other low-income individuals with premiums and out-of-pocket expenses (although 400% of poverty is not where I would have set the limits).  It’s how they did these, and the many other complex provisions in ACA, that is the problem.

The bill has proven to be as incomprehensible as critics warned, with new problems emerging every day – e.g., the “Bay State Boondoggle” that shifts money from other states to Massachusetts hospitals, or how ACA treats Congressional staff.  One suspects more surprises are in store, and more retreats.  The Administration had hoped that support for ACA would grow over time, but the reverse seems to be happening, with recent polls showing it is more unpopular than ever. 

The Administration is justifiably terrified than healthy uninsured individuals won’t sign up for coverage, which risks blowing up the individual marketplaces due to the expected new influx of unhealthy individuals (just look what happened to the ACA high risk pools).  Accordingly, it is gearing up for a huge PR campaign to encourage enrollment.  They can’t even do that without controversy, as Secretary Sebelius first was caught trying to strong-arm organizations that her department regulates into donating money for the effort, then got caught fibbing about getting the NFL involved. 

One has to assume that the only reason she’s still around is so that she can take the fall for whatever debacle happens this fall when the marketplaces are supposed to go live. 

With perfect hindsight, I would suggest that ACA tried too hard to keep much of the existing system, and that has led to many of these problems.  It did so for political reasons, obviously, but it’s hard to argue now that those expediencies make as much sense as planned.  I believe that three simple but major changes would have made a dramatic difference:

• Not voluntary: If we truly want everyone covered, and are not willing to deny care to those who do not take action to make that happen, then the system can’t be voluntary.  It certainly can’t be voluntary with penalties that are far less than the cost of coverage, as is true with ACA.  It should be set up more like automatic enrollment in 401k, where people have to actively opt out of being enrolled, not vice-versa. 
• Not employment-based: It’s the open secret of our health system that the tax preference for employer coverage has decidedly perverse effects, yet ACA only tinkered with it.  In addition, trying to ensure uniformity of anything among the literally hundreds of thousands of employer plans is a Sisyphean task, as the recent mandate delay and contraception rules well illustrate.  Until ACA’s reforms, there were no viable individual options for many Americans, but with the guaranteed issue requirements and the exchanges, we could have moved away from the anachronism of our employment-based system.
• Fix Medicaid: there is no program, not even Medicare or the VA, that serves more vulnerable populations than Medicaid’s, yet our patchwork of state-based Medicaid programs, operating under a byzantium set of federal rules and funding, is a national disgrace.  Blowing it up, and finding ways to mainstream coverage of those populations (e.g., buying private coverage) while still addressing their unique vulnerabilities, could have brought in support from many of those Republican Governors and legislators that are now opposing Medicaid expansion. 

I’d like to put on rose-colored glasses and assume everything will all work out, at least in time, but I fear that things are going to get much, much worse before they get any better -- especially if the Administration is just going to throw its hands up when things become more difficult than they expected.

Study finds fewer office visits, prescriptions with CDHPs | Home Channel News

By Cyndy Nayer, July 1, 2013

There are more studies being translated for consumer sites and broader business reach.  Small and large businesses alike know that up to 20 cents of every revenue dollar goes toward health care.  Understanding what works, what appears to work, and what really isn’t hitting the mark is crucial for business success.

This article echoes the findings of studies from Employee Benefit Research Institute (EBRI),  Kaiser Family Foundation, and others.   When folks have to choose between paying out of pocket for appropriate care and paying the rent, the care falls behind.  Study after study have shown that, over the past 5 years, fewer prescriptions have been filled, more prescriptions have been subject to non-compliance (pill splitting, etc.), fewer follow up physician visits and tests/labs have been performed, all of which hinder outcomes.

AHIP recently published an infographic showing the increase in CDHP plans.  These increases appear to dovetail with the lower adherence to protocols that could prevent rescue treatments and avoidable inpatient days.  

The opportunity in value-based design is to follow the high-value protocol and treatments.  These can be place on special designs that encourage the appropriate behaviors.  Further, direct contracts with providers, urgent care centers, and pharmacist coaches can help to manage high-cost chronic care, even within account-based consumer-directed plans.

Let’s spread the word:  consumer-directed can work, but the insurance plan design and contractual arrangements for appropriate, outcomes-based quality providers, are essential.

Consumer More Generous This Year with Expressing Health Plan Satisfaction

By Clive Riddle, June 28, 2013

J.D. Power has just released their excellent annual Health Plan Study of Satisfaction.  I got a different major takeaway from the study than did the folk at J.D. Power, although I also agree with their conclusions. Their take is in the context of the impending health exchange environment: “With such alternative healthcare purchasing choices as public and private exchanges--or cutting coverage altogether--taking shape among employers, health plans risk losing group business unless they improve employer satisfaction.” 

The J.D. Power study “is based on responses from 5,857 employers, with quotas to assure an adequate distribution of small, medium and large companies. The study was fielded in April and May 2013. …The study, now in its fourth year, measures six key factors that affect employer satisfaction with health plans: employee plan service experience; account servicing; program offerings; benefit design; problem resolution; and cost. Health plans are ranked in two employer segments: fully insured employers (health plan assumes the risk of providing health coverage for insured events); and self-funded employers (employers bear the risk associated with offering health benefits).”

Richard Millard, J.D. Power’s senior director of the healthcare practice  tells us “health plans need to understand the importance of satisfaction in order to limit the erosion of their business from employer-sponsored coverage to alternative channels where employees have more choices. Those health plans that focus on closing the satisfaction gap across key performance factors are more likely to retain employer-sponsored group contracts."

J.D. Power notes that “nearly one-fifth (15%) of employers say they "definitely will not" or "probably will not" continue sponsoring coverage in five years. Among employers in both segments, there is a 90-point gap in overall satisfaction scores between employers that intend to offer coverage in the future and those that intend to discontinue coverage.”

They go on to point out that “in both the fully insured and self-funded segments, employer satisfaction with program offerings, such as preventive health programs, disease management or wellness initiatives, is a key area of differentiation between employers that intend to offer coverage in the future and those that intend to drop coverage.  In the program offerings factor, the gap in satisfaction scores between fully insured employers that intend to offer coverage in the future and those that intend to drop coverage is 104 points--705 among employers that intend to offer coverage, compared with 601 among those that intend to drop coverage. Among self-funded employers, the gap in satisfaction scores between those that intend to offer coverage in the future and those that intend to drop coverage is also 105 points--689 among employers that intend to offer coverage, compared with 584 among those that intend to drop coverage.”

All good point as 2014 hovers over health plans. But what I found interesting was that health plan satisfaction scores improved significantly almost across the board for plans, compared to their 2012 study. I compiled their 2012 results with the current results J.D Power made available:

Overall Customer Satisfaction Index Scores
(Based on a 1,000-point scale)

Fully Insured Employer Segment	2013	2012
HCSC	741	697
Cigna	737	689
Kaiser	737	718
Aetna	724	670
Fully Insured Segment Average	709	675
WellPoint/Anthem	707	658
UnitedHealthcare	703	663
Humana	693	691
Self-Funded Employer Segment
Cigna	707	643
Self-Funded Segment Average	696	665
Aetna	694	682
WellPoint/Anthem	692	631
UnitedHealthcare	669	662

What is the cause of the rise in satisfaction? The 2011 overall rate full insured was 696, so the rate dropped in 2012, and rebounded even higher in 2013. What are the implications of this improvement in satisfaction as the health exchange landscape takes shape?

Here’s a graphic J.D. Power provided on fully insured satisfaction results:

Fine-Tuning your E-Mail Subject Line

By Claire Thayer, June 25, 2013

Managing our daily email volumes is a growing task and something tells me yours is too! A report published by The Radicati Group earlier this year estimates that in 2013, the typical corporate user sends and receives about 219 messages daily, up from 167 in 2009. This study confirms a McKinsey Global Institute report that  finds employees spend more than a quarter of their workday (28%) each week reading and answering e-mails. 

Well, if you’re in the advertising business or trying to market your message, it’s more important now than ever to start thinking about creative ways to fine-tune and tweak your email subject line so that your message gets read! Here are a few tips:

• Keep it short. The less the better, many recommending 70 characters or less, and we’ve seen some recommend as few as 15 characters.
• Tell the why. What’s in it for the reader? Give them a compelling reason to open the email.
• Ask a question. This gets direct right away: “Would you like a free subscription to MCOL Basic?
• Personalize. While the email may be distributed to hundreds or even possibly thousands of email addresses, make it personal, using “you” to draw attention.
• Arouse curiosity. Peak the reader’s interest with something unusual, new, odd, unique, compelling.
• Avoid ALL CAPS.  People feel like they're being yelled at when seeing ALL CAPS, who wants that?

We send out emails to close to 150,000 addresses for health care business professionals every month and have lots of ideas of ways to get your email open, just ask us!!

McKinsey Global Institute (MGI) report: The social economy: Unlocking value and productivity through social technologies

http://www.mckinsey.com/insights/high_tech_telecoms_internet/the_social_economy

The Radicati Group report: Email Statistics Report, 2009 - 2013

http://www.radicati.com/wp/wp-content/uploads/2009/05/email-stats-report-exec-summary.pdf

Businessweek’s: The Art of the E-Mail Subject

http://www.businessweek.com/articles/2012-06-28/the-art-of-the-e-mail-subject-line

Hiding in Plain Sight

by Kim Bellard, June 18, 2013

I saw two recent articles in The New York Times recently that I thought merited further discussion.  One attracted a fair amount of attention, the second not quite as much.  They deal with the high prices in the U.S. health system and the trend towards provider consolidation, respectively.  Both problems are well known, yet they describe continue to get worse, not better.  

The first article – The $2.7 Trillion Medical Bill: How Colonoscopies Explain Why the U.S. Leads the World in Health Expenditures – focuses on the wacky world of charges and overuse of expensive procedures, especially as they relate to colonoscopies.  It will come as no surprise to anyone who has been paying attention, but their analysis indicated that charges for the procedure varied dramatically between providers, and were much higher than in other countries.  The U.S. also does them more commonly than many other countries, preferring the expensive surgical approach to other screening options.  

The boom in the number of colonoscopies has been great for gastroenterologists, anesthesiologists, and surgical centers; for patients, perhaps not so much.  The article’s discussion of how many gastroenterologists have invested in surgical centers to reap more of the profits from the procedure is disturbing, and they are far from the only specialty to have discovered this financial gimmick.  It’s part of what drives our health care bill.  

The article notes that insured patients typically shrug off the inflated charges, since their insurance has negotiated rates that are far lower, but, of course, uninsured patients get stuck with the full bill, kind of like having to pay those absurd prices on the back of hotel room doors.  Arbitrary and inconsistent as charges may seem, they’ve nonetheless helped lead to “allowed charges” that are still much higher than anywhere else in the world.  We all end up paying for the costs, of course, through higher insurance rates or as taxpayers.  

Meanwhile, the second article – Health Care’s Overlooked Cost Factor – centers on market consolidation, particularly through mergers of health systems.  It starts off with the FTC’s first successful antitrust case against a hospital merger since 1990 (!!), blocking the merger of two neighboring Chicago hospitals.  A victory of sorts, but the case was done post-merger and it is not at all clear that the ruling actually rolled back pricing with the payors to the levels they would have been sans merger.  

Earlier this year the FTC did move to block the acquisition of Idaho’s largest physician group by its largest hospital provider, so perhaps they’re starting to wake up to the problem.  With all the health system merger activity in the past 10-15 years, these isolated victories lead one to wonder why the FTC has been so asleep at the wheel. 

The article cites research by Gaynor and Town, done for the Robert Wood Johnson Foundation last year, which concluded that hospital consolidation generally raises prices, often dramatically, and that physician-hospital consolidation has not led to improved quality or reduced costs.  Their research is not the first to reach these conclusions, and of course the American Hospital Association has a different perspective.  Earlier this month they released a report that which indicated that only about 10% of hospitals have been involved in a merger in the past five years, that most mergers aren’t happening in concentrated markets, and don’t necessarily result in higher prices.  Uh-huh.  

AHIP was quick to rebut the recent study’s conclusions. 

These are well-known problems.  The insight on prices goes back at least ten years to Gerry Anderson’s Health Affairs famous article “It’s the Prices, Stupid.”  Steve Brill wrote a similar article in Time (“Why Medical Bills Are Killing Us”) earlier this year.  The state of California and the Commonwealth of Massachusetts have both publically been concerned about the consolidation issue, and there was the great quote from consultant Robert Murray: “Finally the evidence is catching up with the reality that we have a humongous monopoly problem in health care.”  Even I’ve previously written on both prices and market consolidation.  So, no, these shouldn’t catch anyone by surprise. 

Many experts cite greater transparency as an important way to attack prices, and there are numerous companies purporting to provide consumers transparency tools.  Indeed, a recent report from the Aite Group claims transparency itself will be a $3 billion industry by 2016 – up from $540 million in 2012.  Of course, someone – i.e., consumers – ultimately will pay for that increase.  Only in the American health care system does creating a business to provide information on prices lead to greater costs for the system, as to date the data is inconclusive at best that consumers will actually change their behavior based on transparency information.  And in a consolidated market they may find few options to price shop even if they want to. 

We need more competition, and we need it on the right things, like value.  I’m not sure any of the metrics we use now are going to get us there anytime soon.  Some claim that this is the era of “Big Data,” and its application in health care will provide revolutionary insights.  McKinsey & Company issued a report that says use of Big Data in health cae could save $450 billion a year.  Do a search on Big Data in health care and you’ll find a plethora of eager companies, from behemoths like IBM to upstarts that specialize in health care, like Explorys,  GNS Healthcare, or Health Catalyst, to name a few.  Hidden in the morass of health care data, it appears, are gems. 

Much has been made of the recent scandal over the NSA pulling unimaginable reams of data from telephone and internet records, and using their Big Data capabilities to mine it – hopefully only to detect terrorists.  Meanwhile, when I read articles like the one Bloomberg News recently reported about how one Chicago hospital has literally been cutting patients’ throats – e.g., performing tracheotomies -- unnecessarily to increase revenues, I kind of wish we did have some Big Brother looking at the data better.  

In a series of articles over two years ago the Wall Street Journal showed (see here or here) the kinds of fraud can be detected through proper analysis of the Medicare claims data – and it makes one wonder why CMS hasn’t done the same.  Perhaps now that the Wall Street Journal has forced CMS to release Medicare claims data on individual doctors someone else can detect this kind of abuse on an ongoing basis.  That data is still not freely available, but at least the door is open wider.  

Some say pricing can be addressed via greater transparency, others want more bundled payments, and yet others like reference pricing, which essentially limits payor liability to a fee schedule.  I’m old enough to remember when health insurance often had set fee schedules, with charges above those scheduled amounts the patient’s problem, and I don’t recall people being too crazy about them.  On the other hand, costs were a lot lower, so maybe there is something there, just as we’re also going back to the old idea of big upfront deductibles.  

Personally I think the source problem is that we’ve allowed our pricing structures to become so complex, so piecemeal, and so jargon-filled that no consumer – and few professionals – can really be expected to understand them, much less shop based on them.  Step one has to be to greatly, greatly simplify how we price health care services. 

One of my pet peeves in health care are those financial responsibility forms providers try to get everyone to sign upfront.  They say, essentially: we don’t know exactly what we’ll do to you, or how much it will cost, and we may get some other people to do some other things to you too, and we don’t know what that will cost either, but whatever is done to you and however much it costs, you are obligated to pay.  I’m no contract lawyer, but that sure doesn’t seem like an enforceable contact to me, given the vast asymmetries.  I’d sure love to see the ACLU or Public Citizen or maybe even AHIP take this on in court.  Pricing would get a whole lot more rational if there had to be more upfront disclosure and agreement. 

As for the market consolidation, if health systems are going to create monopolies or virtual monopolies, they may need to be treated more like public utilities, facing rate and spending review.  I’d hate for that to happen, and much prefer that we reimagine the role of these capital-intensive structures.  Why do these big buildings with all those beds and all that equipment still make sense in the 21^st century?  Can they be reinvented with something that allows more competition?  I offered one conceptual approach some time ago, but would welcome other proposals to address the issue. 

There is a lot of “reform” happening in health care these days, but if they just end up incorporating these two structural problems I doubt we’re going to actually see much real improvement to our health care system.

Infographic: Chronic Care is a Team Sport

By Cyndy Nayer, June 13, 2013

Chronic care is a long-term management strategy, and it requires a focus on outcomes, especially in reimbursement for the team of providers that manage the complex conditions. Diabetes, hypertension and high cholesterol get a lot of attention, but there are more, such as depression, cancer, arthritis. While the ACA will attempt to manage the escalation of premiums, it requires a team effort to manage chronic care. Lifestyle, treatment adherence, and regular primary care visits are a must. Value-based designs will work to get better engagement from the beneficiaries, but the plan sponsors, especially the employers, must pay close attention through regular data reporting, coordinated care, and communication across all of the team members, including the patient and his/her family. Chronic care is a team effort, and to be a member of the winning team, coaches and players must be headed for the same goals!

For more blog posts by Cyndy Nayer, visit www.cyndynayer.com/category/cyndys-voice/

HealthShareTV Videos on Reducing Readmissions

By Claire Thayer, June 10, 2013

Finding ways to reduce and curb hospital readmissions is an important component of reducing overall health care costs. In a video posted on HealthShareTV, Dr. Shari Welch presents a tutorial on Emergency Department Readmissions and discusses how the ER department can help hospitals reduce readmission rates. Watch this 30 minute video here: http://www.healthsharetv.com/content/shari-welch-md-tutorial-emergency-department-readmissions. The HealthShareTV site has several videos posted related to readmissions, here are just a few:

Hundreds of videos are posted on HealthShareTV: http://www.healthsharetv.com.  Topics are range from Accountable care, employers, health plans, reform, insurance exchanges, mobile health, predictive modeling, etc. Use the video finder to quickly drill down to category of interest.

For more information about the Readmissions Reduction Program: http://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/AcuteInpatientPPS/Readmissions-Reduction-Program.html

If you are interested in monthly business intelligence and news on this topic, I think you’ll find Readmissions News of interest: http://www.readmissionsnews.com/

A response to Friedman and Obamacare Innovation Surprise

By Cyndy Nayer, June 4, 2013

Thomas Friedman posted a column in Sunday’s NYT that highlights the surprise in technology innovation as a result of Obamacare. But one example needs an update, so I, serial disrupter will now step out and argue with a journalist that I adore.  Mr. Friedman, because a system or a provider has an electronic medical record does not ipso facto mean that info can be shared and care coordinated.  If my provider is at one hospital system, but I also use another provider or system, and each use a different IT platform, they can’t talk, and I can’t get coordinated care.

This is an important fact and one that needed to be addressed before the billions of dollars were invested.   Mind you, I agree with the investments (that will anger a few of my followers), as they came exactly at the right time and place:  the intersection of health care and the economic downturn that put a lot of very smart people out of work and out of health care coverage.  We needed that influx of dollars to invigorate the geniuses to update the platform that was crushing us in health care.  You know the platform, even if you can’t name it, by the tag line:  ”our legacy systems don’t talk to each other.”  I’ve been hearing that phrase since the early 1990′s, and iPhones, iClouds, twitter, facebook and more were not even thought of at that time.  If I can get my iTunes anywhere in the world why can’t I….but I digress.

If we had required some interoperability standards BEFORE the money was awarded, we would be much further along today.  Because we supported the information expansion but didn’t consider the accountability standards for the health care delivery system nor the consumerism (read as “people must make purchasing decisions”) that would be required, people cannot get their data.  In fact, it’s been 3.5 years now since Obamacare came to be, and despite blue buttons or pink buttons, my medical record is incorrect, hasn’t been corrected in 6 weeks, and it has implications for my personal health that, if I need care soon, could have dire consequences.  Even the care provider’s information maven says my info is incorrect.  But no corrections have been made and, of course, I don’t have access to put in patient notes, either.

If we considered what would be required of folks across the country, and many of us do travel across our great land, then we would have known that our data must move with us.  We have a model like that in our country:  the veterans administration data travels with the soldier wherever he or she is stationed.  That simple process would have made accessibility so much easier without destroying “proprietary rules” of innovation companies, insurance companies, and health systems.  In other words, we did so much right from the tech and economic recovery side, but we forgot the people who will, ultimately, bear the brunt of the fallout in choices.

I chose a well-respected provider and health system.  They are part of a national leader in medical technology.  So the system did “patient-centered” without considering “patient inclusive” and that’s not ok.

It’s hard to catch the cow once she is out of the pen, I’m told (never caught a cow).  Probably applies to the innovation rocket ship we launched.  But humanity is calling to be injected into this scenario.  You can’t hold me accountable if I can’t get the data–I’m shooting blanks and so is the system without my input.  Data is just data without me and my story, or you and yours, told with accuracy.

So hurrah for the innovation injection, which, in fact, is mirroring what happened with NASA and national innovation in the 60′s and 70′s.  Now, include me.

Obamacare’s Other Surprise – NYTimes.com.

More Arrows Out of the Cost Management Quiver?

By Kim Bellard, May 31, 2013

Even as health costs seem to have dramatically slowed in recent years, some recent studies now question whether some commonly proposed methods of attacking those costs – reducing geographic practice variations, increasing patient shared-decision-making, and employee wellness programs -- actually have the potential that proponents have claimed. 

Let’s start with the geographic practice variations.  It’s been over thirty years since Jack Wennberg first mapped out the sometimes startling variations in health care costs and utilization.  The Dartmouth Atlas has continued and expanded on his work, and it has become almost dogma that such variations exist.  The belief has been that they could account for as much as 30% of care that is inefficient/unnecessary, which could be cut without harming patient safety.  Respected experts like Atul Gawande have written eloquently on these variations, and then-CBO head Peter Orszag popularized the idea to the extent that President Obama seized upon it in his campaign to pass the Affordable Care Act.  Turns out the conventional wisdom may be wrong.

New research from Jack Reschovshy and his colleagues indicates that health status, not geographic practice variations, drive 75-85% of apparent geographic cost variations.  They took a new approach to case mix adjustments and concluded that, for the most part, higher cost patients were, indeed, sicker.  The researchers took pains to note that their conclusion is not to suggest that significant waste and inefficiency do not exist in our health care system, but simply that those are not easily boiled down to geographic practice variations.

I’m not sure how this research squares with, say, the differences in hysterectomies or C-sections that have long been known, but, to be fair, the researchers did only focus on the Medicare population.

Then there is patient shared-decision-making.  This is at the heart of consumer-driven plans, with the belief that once patients are more involved in their care, and more exposed to the costs and trade-offs inherent in that care, they will become more prudent purchasers.  The latest issue of JAMA Internal Medicine included several studies and articles on this topic – one of which, a study by Tak and colleagues, throws cold water on the idea of SDM saving money.  They found that while over 70% of patients preferred to leave decision-making to their physician, patients who did actively participate in that decision-making had longer hospital lengths of stay and costs (the study only focused on hospital patients). 

One could easily see how more vocal patients might demand more care, or we can speculate that these patients became more involved in their decision-making because they were sicker.  Correlation is not, after all, causation.  We should also keep in mind that Tak’s results are somewhat at odds with recent research by Hibbert that suggested higher patient activation predicts lower costs.  As researchers always like to say, more research is needed. 

It’s not good days for SDM.  Another of the JAMA Internal Medicine studies, by Fowler et alia., was a nationwide survey of adults 40 years or older on their experiences with being involved in medical decision-making.  Patients reported more discussion of pros than cons, and more balanced discussion about surgeries than cancer screenings or medication treatment.  The authors conclude that “discussions about these common tests, medications, and procedures as reported by patients do not reflect a high level of shared decision making.”  A third study, by Wachterman and colleagues, found a lack of congruence between expectations of hemodialysis patients and their nephrologists, with the patients being much more optimistic about their prognosis, and conclude better communication is needed. 

A fourth study, by Krumholz, surveyed patients with Acute Myocardial Infarction, and found that over two-thirds wanted active involvement in decision-making, but the authors admit that “…shared decision-making is not yet integrated into routine medical care.” 

Face it: the winners in the health care system have been hospital systems and pharmaceutical companies.  These are important institutions, which employ many caring and well-intentioned people, but whose historical orientation is treating sick people – the sicker the better.  As comedian Chris Rock puts it, “Ain’t no money in the cure, money’s in the medicine.” 

Hospitals are consolidating and buying up physician practices at record rates in order to improve their clinical integration – or improve market clout – and the pharmaceutical industry has been off to the races ever since DTC advertising has been allowed.  As proof, consider the fact that Americans take, on average, 4 billion prescriptions per year.  That’s 13 prescriptions per year for each and every one of us, and many of those are for “lifestyle conditions” that arguably could largely be avoided if we simply ate better and got more exercise. The answer may be less in changing what we do to sick people than in simply having more healthy people. 

That is one reason why many employers have instituted employee wellness programs.  According to Aon Hewitt, 83% of large and mid-sized firms have some employee incentives in place to help them be more active in maintaining their health.  ACA not only permits such programs but expands how much they can incent employers.  Under new rules, employees will be able to reduce their health insurance contributions by up to 30% -- up to 50% if smoking cessation is included – by participating in such programs.   The oft-cited success story in employee wellness programs is that of J&J, which was so happy with its success that it turned the programs into a business line, part of the $6 billion wellness industry. 

However, even the success of wellness programs is not quite clear-cut.  Reuters reports that a recent report from RAND to DOL and HHS found at best only modest successes – and the report was mysteriously pulled from public availability within hours of its release.  Looks like some other people have some explaining to do…

Sometimes it seems like we really don’t know anything, or that the things we thought we knew aren’t true.  For example, for decades the gold standard for treatment of appendicitis was an appendectomy; now it appears that surgery may not be called for at all, with antibiotics doing the trick.  And doing even get me started on the controversies about cancer screenings, like PSA tests.

I wonder if years from now we’ll look back on this age of medicine much like we might regard medicine of the 19^th century: well-intentioned but almost comically primitive in its misguided notions about how to treat conditions.  E.g., maybe the future is in the microbiome rather than in our prescription medicines and surgical approaches.  No one can tell me that any clinical studies for a given drug are truly taking into account the other 12 prescriptions a user might also be taking, nor fully take into account what havoc the cocktail of prescription drugs will have on the body’s natural defenses. 

We are starting to realize the importance of our internal bacteria, but we still don’t really know exactly what they do or how we can take best advantage of them.  Then again, we’ve been studying geographic practice variations, shared-decision-making, and employee wellness programs for a long time, and we don’t seem to know as much about them as we thought we did either.  Based on these new studies, there are a lot of consultants, disease management companies, and wellness firms that may have a lot of explaining to do.  

When push comes to shove, I still believe that there are unnecessary practice variations, that getting patients more involved in decision-making is the right thing to do, and that efforts to focus on health rather than on illness are the way to go.  Whether we know how to do any of those correctly, though, is an open question.