What do Copernicus and Today’s Healthcare Leaders Have in Common?

By Maria D. Moen, May 13, 2022

Both Use Data to Change the World as We Know It 

In 1543, Copernicus was the first astronomer to propose the theory that the earth and other planets rotated around the sun, which contradicted popular thought at the time that the earth was the center of the universe. Through mathematical and astrological analysis over the course of many years, Copernicus effectively moved the sun to the center of the universe with his simple and elegant explanation of the retrograde motions of the planets.

Today, a similar “Copernican Shift” is taking place in healthcare as innovative leaders tackle the hard problems of staffing shortages, reduced patient loyalties due to trust and health equity concerns related to the healthcare system as a whole, and the need to bring forward strategies for growth to rebuild their own particular business models post-COVID.  Turning to new ways of looking at how to regain diminished revenue and increase market share by leveraging the data that has been collected about their patients, combined with the insights that data is revealing, has led to a shift in the balance of power from the patient revolving around various healthcare providers to the patient being the center of the healthcare universe, around which their healthcare providers revolve to deliver coordinated, complementary care.  This foundational change in how providers perceive and treat their patients as a key recovery strategy post-COVID is gaining traction as they derive strategies to make the transition from traditional fee-for-service to value-based care models.

For decades, healthcare decision-making was based principally on a provider’s own records which were often in paper files and siloed across the various organizations that treated the same patients. But a paradigm shift is taking place, thanks to the power of technology, to better connect providers and patients in ways that produce more data-driven decision-making, better clinical outcomes, and greater patient satisfaction. Today we find ourselves in a watershed moment that could rightfully be called a digital health revolution as new technology platforms and smart devices continue to disrupt, in a positive sense, the way information is collected, the way healthcare is delivered, and the way consumers are able to personally interact with the healthcare system. As a result, emerging technologies have evolved from a “nice to have” to a “need to have.” Now that this fuse has been lit, all indications point to an ever-increasing acceleration of this movement in 2022 and beyond.

It is encouraging to see the healthcare ecosystem populated with an increasing array of marvelous innovations capable of efficiently performing many useful, previously resource-intensive functions. These solutions put our industry on a journey to even greater achievement while also providing visibility into how we can expect the digital healthcare engine to evolve in the near term. In this atmosphere of looking at old problems in new ways with more powerful tools, three truths have been revealed:

1. The best reporting tools look forward, not backward. Business leaders don’t adopt technology based on capabilities alone. They often select solutions based on the reporting and analytical insights they can gain and whether those insights translate to meaningful business intelligence. Reporting that looks forward and projects what “could” happen as delivery systems are incrementally adjusted based on what “did” happen, gives clarity to  a wide array of sectors within healthcare. In doing so, the shift to put the patient and what they want at the center of treatment decisions has become more mainstream and less innovation.

When the power of historical and current data is harnessed to reveal issues or barriers to increased productivity and higher patient satisfaction, those matters can be confronted in a timely manner by the organization before they snowball into large-scale problems. Monitoring patient trends using data available (but previously not actively used) to create insights across populations also allows healthcare organizations to track patient behaviors as part of anticipating how to increase utilization and satisfaction. This information helps tailor care to the individual which improves outcomes and reduces unwanted events. In short, effective reporting isn’t merely about understanding what has happened in the past but is also about providing the intelligence needed to move forward with confidence.

2. Healthcare leaders need unencumbered access to their data. If leaders are to optimize healthcare delivery and derive strategies to address the issues that hinder growth and increase revenue, they need the ability to benchmark the performance of specific processes and functions. Limiting access to data, whether intentional or unintentional, only impedes these improvements and weakens the organization as a whole. The right information analysis and understanding of the tools available allows healthcare professionals to spot weaknesses, identify strengths, and predict events before they occur.

Without access to these insights, management is unable to make timely, data-driven decisions or easily share information across organizations to support new patient-focused value-based care initiatives. That’s why comprehensive patient data tracking, reporting, and analytics tools are important tools to delivering actionable business intelligence.

3. Data must be integrated across care settings. The overarching goal of healthcare is to provide patients with interventions that render the best possible outcomes. This goal, however, is impeded when patient information resides in multiple locations and is not readily accessible as the patient receives care from multiple providers in various care settings. Transitions in care – between providers or across levels of care – are particularly vulnerable breaking points and serve to make the need for immediate access to information about the patient regardless of where care is delivered all the more critical.

Ensuring data privacy for the patient being served can further complicate the process of moving personal health information across the healthcare continuum, but fortunately interoperability standards are being embraced for seamless and secure data exchange and accessibility from one system to another. These standards give patients the opportunity to engage with their providers directly from remote locations or when due to illness or injury they can’t speak for themselves, allowing them to bridge provider knowledge gaps, information silos, and be more active participants in their care.

The ability to bring patient voice into the center of healthcare delivery is continuing to rise in demand as patients welcome the shift from being moved from one provider to another without the ability to impact the care they receive to being able to influence their own care across providers. One outstanding example of this is the increased attention being paid to advance care planning (ACP) and its rightful place in a digital world. An ACP document can assure patients that their own voice – not the “voice” of a hospital, employer, health plan, or any government – will be heard and used to inform the care they do or don’t desire. Documents such as an advance directive or an advance care plan empower people to express their priorities for quality of life and memorialize what makes life meaningful to them. ACP documents allow individuals to specify where they want to receive treatment – at home, or in a senior care setting or in a hospital, for example. And they provide the opportunity to share those preferences and priorities for their life and healthcare decisions with their advocates and the medical teams who will ultimately make treatment decisions for them. Here, too, technology is playing a major role as digital platforms exist that allow for ACP documents and portable medical orders such as DNR orders and POLST forms to be easily created by patients or providers in a streamlined approach, securely stored and, most importantly, made accessible to family, caregivers, and healthcare providers 24 hours a day, 7 days a week, every day of the year.

This is indeed an exciting time in healthcare as the appetite for innovations in technology and the use of data to create new insights to change healthcare delivery models are moving the patient to the center of care and creating a more personalized and responsive delivery system. As the Copernican Shift continues to evolve, healthcare organizations and providers will continue to embrace new tools and analytics as part of a truly connected healthcare ecosystem. I'm excited to see what the future will bring!

Maria D. Moen is Senior Vice President of Innovation & External Affairs at ADVault, Inc., the nation’s leader in digital advance care planning solutions. Its end-to-end, cloud-based, SaaS solutions empower patients to create, store, and share their ACP documents in a secure, protected platform.  ADVault also enables healthcare providers to manage their ACP activity and supports providers’ creation, update, storage of their patients’ healthcare wishes in a secure, electronic registry and repository that can be accessed by medical teams anytime, anywhere. http://www.advaultinc.com/  

We Love Innovation. Don’t We?

By Kim Bellard, April 22, 2022

America loves innovation. We prize creativity. We honor inventors. We are the nation of Thomas Edison, Henry Ford, Jonas Salk, Steve Jobs, and Stephen Spielberg, to name a few luminaries. Our intellectual property protection for all that innovation is the envy of the world.

But, as it turns out, maybe not so much. If there’s any doubt, just look at our healthcare system.

Matt Richtel writes in The New York Times “We Have a Creativity Problem.” He reports on research from Katz, et. alia that analyzes not just what we say about creative people, but our implicit impressions and biases about them. Long story short, we may say people are creative but that doesn’t mean we like them or would want to hire them, and how creative we think they are depends on what they are creative about.

“People actually have strong associations between the concept of creativity and other negative associations like vomit and poison,” Jack Goncalo, a business professor at the University of Illinois at Urbana-Champaign and the lead author on the new study, told Mr. Richtel.

Vomit and poison?

Well, at least our patent system, which protects intellectual property and helps fosters innovation, works, right? Again, not so much. A New York Times editorial charges: “The United States Patent and Trademark Office is in dire need of reform.”

If there’s any doubt, just look at the price of insulin, which has been propped up by patent “innovations” that keep its price high after a hundred years. “When it comes to protecting a drug monopoly,” The Times says, not limiting those monopolies to insulin, “it seems no modification is too small.”

The U.S. is still, by far, the leader in patents granted, but not in scientific research papers or R&D spending per capita/% of GDP, which makes one wonder what all those patents are for.

Healthcare desperately needs innovation. No one can dispute that; not anyone working in it, not anyone receiving care from it, not anyone who has had any exposure to it. But healthcare also has a lot of middle managers, and middlemen, and, as Professor Mueller said, “Novel ideas have almost no upside for a middle manager.”

Even worse, healthcare is always teetering on the edge of uncertainty — where’s the funding coming from, how much, what health crisis is coming, what’s the government going to do next? The forces causing all that uncertainty should be driving innovation, but, as Professor Morrison’s 2012 research also found, “…uncertainty also makes us less able to recognize creativity.” We have blind spots about what creativity is, who creative people are, and when and how we should incorporate those into our organizations.

Right now, healthcare thinks that EHRs and digital health — whatever that might actually be — qualify as innovation. That’s enough, it believes; those are forcing change in ways and at a pace healthcare is not used to and is not comfortable with.

Too bad.

It has been said that if your company has an innovation department, it’s not innovative. If it has middle managers deciding which novel ideas get pursued, don’t expect real innovation. If it is ruling out hiring people who worked on unusual projects (think sex toys), it’s rejecting creativity.

Your biases against creativity may (not) be showing.

This post is an abridged version of the original posting in Medium. Please follow Kim on Medium and on Twitter (@kimbbellard)  

ARPA-H Needs to Think Bigger

By Kim Bellard, March 25, 2022

Everyone loves DARPA, the Defense Advanced Research Projects Agency that is credited with such hits as the internet and GPS, but is also responsible for things like the Boston Dynamics back-flipping robots and even Siri.  

Healthcare is, at long last, getting its own DARPA, with ARPA-H (Advanced Research Project Agency for Health).  It’s been discussed for years, but just last week was finally funded; a billion dollars over three years.  But I fear it is already off on the wrong foot, even ignoring the fact that President Biden had requested $6.5b. 

Let’s start with the problem that it not only doesn’t have a leader yet, but it doesn’t even have a home.  More worrisome, though, is that, according to President Biden, “ARPA-H will have a singular purpose: to drive breakthroughs in biomedicine.”   The mission wasn’t originally that limited, but priorities like the “cancer moonshot” tend to focus emphasis. Biomedicine isn’t going to solve all of our health and healthcare problems.

Take, for example, the developing fiasco that is the replacement VA EHR.  Decades ago the VA developed VistA, one of the first attempts at an EHR, but during the Trump Administration it was decided to move to a commercial EHR.  Cerner won the bid.  According to three reports issued by the VA Inspector General last week about the first implementation, it is not going well, to say the least. 

Now, I’m not intending to pick on Cerner – its DoD EHR rollout seems to be doing better – or advocating for VistA. I don’t want ARPH-A to help invent a new and improved EHR.  I want them to help invent the technology that is to EHRs as EHRs are to paper records.  I want a big leap.

I want the next generation of health information technology, allowing people to store, share, exchange, and use key health information, making all that look easy – like magic.  I want technology that may not become mainstream until 2050, but which would still be useful in 2100.

I don’t know what technologies will be important to that. Maybe holograms, maybe digital twins, maybe DNA storage, maybe blockchain/Web3, maybe AI, maybe quantum computing.  Maybe all of those, and others.  The important thing is, think big enough.  About this problem, and others.

We should be looking at breakthrough technologies that get at health in our everyday lives.  How do we track it, how do we foster it, how do we improve it where we live?    Those are the kinds of thing ARPA-H needs to help develop.

DARPA’s projects can take 20-25 years to reach commercial viability – if they ever do.  We can’t afford to think too short-term (e.g., anything less than 10-15 years) or too narrowly (e.g., only biomedicine). When we think about ARPA-H projects, we should thus be thinking about what we want to our health and our healthcare system to be in 2050. 

I hope the VA EHR recovers from its stumbles.  But wishing and hoping isn’t getting us where we need to be; we need breakthroughs. 

Based on DARPA’s experience, it’s not important that the leader be a visionary.  We don’t need a Steve Jobs or Elon Musk.  We need a leader who can separate the crazy from the wild, who welcomes that wild, and who knows how to get out of the way of innovators trying to make the wild plausible.   

If what we’re debating is whether ARPA-H should be in or out of NIH, we’ve missed the point.  If we’re focusing ARPA-H on biomedicine, we’re missing the opportunities.  If we’re just trying to avoid more catastrophic failures, we’re having one.

Think bigger.  

This post is an abridged version of the original posting in Medium. Please follow Kim on Medium and on Twitter (@kimbbellard)  

The Tests Were a Test

by Kim Bellard, January 28, 2022

Raise your hand if you’ve gone out shopping for home COVID tests, only to find empty shelves and signs apologizing for the lack of availability.  Raise your hand if you’ve been able to obtain one, but were surprised at its cost.  Raise your hand if you took one and weren’t quite sure you did it right, or wondered who, if anyone, would be getting the results.

Vox says that the COVID home test reimbursement process “is a microcosm of US health care,” and I think they’ve understated the situation.  Testing has been a microcosm for the US health care system generally.  It was a test, and our healthcare system failed.

Throughout the pandemic, we’ve never had enough tests or done enough testing. We didn’t take advantage of macro-tracking approaches like wastewater monitoring.We developed “rapid” tests but questioned their accuracy.  The “gold standard” PCR tests took/takes too long to return results.  As we encountered the highly transmissible variant Omicron, we didn’t scale up the production of tests – or the labs to process them -- enough to keep up with the demand, much less with the number of acquired cases.  

In our free-for-all pricing system, it’s anyone’s guess what a test might cost.  Most PCR tests have been required to be covered “first dollar” by insurance plans, so consumers haven’t been immediately faced with how much those tests cost, but costs picked by insurance end up in premiums eventually.  Home tests have not been, and costs might vary ten-fold or more depending on the manufacturer and/or seller. 

The Biden Administration has belatedly attempted to address these problems, but in a ham-handed way that is also typical for our healthcare system.  Earlier this month, it set up a system to for each household to order 4 free home tests.

The Biden Administration also required private insurers – but not Medicare -- to pay for 8 home tests per member per month, which seems to have come as a surprise to the insurers.  In many, perhaps most, cases, individuals would have to submit claims to their insurer to get reimbursed for these tests.  Insurers only have to pay up to $12 per test; consumers must pay anything above that.  Surprise!

When I read about that process, as a former health insurance executive, I immediately thought: that is not going to work.

What documentation needs to be submitted (receipts, product codes, pictures of the test, etc.), and how, are still unclear, and will vary between health insurers.  

As bad as all that is, we now have a scenario where there are potentially hundreds of millions of tests being taken, but no system for tracking how many are used, by who, or how many positive results there are.  We thought we were doing a bad job counting how many people have received how many doses of the vaccine, but at least there was some reporting system in place.  With these tests, we’re pretty much going to be in the dark.  We’ll never know how many positive cases we’ve had.

Initially, we had no testing strategy.  Then our testing strategy was just “get tested,” with no supporting tactics to make that feasible.  Then, almost 2 years in, we get grand announcements about directly providing free tests, but not enough for everyone, plus mandates on insurers for more free tests that don’t do anything to make the tests more available, affordable, or easy to get reimbursed for.

Yeah, all that sounds like a microcosm of our healthcare system.  As Vox put it, “It’s a needlessly complicated process that provides little benefit but creates plenty of problems.”

Shame on us.  It’s not just the healthcare system that failed the test.

This post is an abridged version of the original posting in Medium. Please follow Kim on Medium and on Twitter (@kimbbellard)  

What Collaborative Health Systems, athenahealth and Milliman Found, Sifting Through CMS ACO Performance Data

By Clive Riddle, October 22, 2021

Collaborative Health Systems has announced their affiliate Accountable Care Coalition (ACC) of Southeast Texas, Inc. generated nearly $64 million in shared savings under the Next Generation Accountable Care Organization (ACO) Model for performance years 2017 through 2020, according to CMS performance year 2020 data. CHS, reports that in 2020, the ACC of Southeast Texas achieved the following outcomes:

• Served more than 18,000 Medicare beneficiaries across southeast Texas;
• Achieved an overall savings rate of 12.2%, the third highest of all Next Generation ACOs; and,
• Generated $30 million in shared savings – a 70% increase from performance year 2019.
• Achieve a 94.6% overall quality score
• The network has experienced a 20% decrease in inpatient discharges per 1,000 and a 29% decrease in ER visits per 1,000 since 2012.

The Accountable Care Coalition of Southeast Texas has participated in the Next Generation ACO initiative since the program's first performance year in 2016. Performance year 2021 represents that last year of the Next Generation ACO Model. Collaborative Health Systems will be managing four Direct Contracting Entities with a presence across 24 states. CHS currently manages two Next Generation ACOs, one Direct Contracting entity, eight MSSP ACOs, a Care Transformation Organization, and three Independent Practice Associations. CHS is a wholly owned subsidiary of Centene Corporation.

Meanwhile, athenahealth reports their ACO clients "earned a total of $143 million in savings in the 2020 Medicare Shared Savings Program (MSSP)", and among their ACO customers, "81% generated shared savings and 100% avoided losses. In addition, athenahealth’s ACO customers achieved an average quality score of 97.8% for 2020 and earned an average shared savings of $22.59 per member per month (PMPM), which compares to an average of $16.23 for all other ACOs participating in MSSP."

Milliman researchers recently published results of their analysis of ACO characteristics determined to be strongly predictive of MSSP gross savings, comparing current ACO performance analytics to a previous study conducted in 2015.

Milliman researchers found that the drivers of recent success are quite different and, in some cases, the opposite of what they were in 2015. With Pathways to Success, CMS endeavored to reshape the MSSP by adjusting incentives, encouraging greater accountability in ACOs, and offering options specific to each ACO’s ability to take on risk. Their analysis gives early indication that these changes are rewarding ACOs for attained efficiency levels, possibly enhancing the attractiveness of the program. Furthermore, the authors also see evidence of at least some correlation between tracks with downside risk and higher gross savings, supporting CMS’s case for accountability as a policy priority, though voluntary track selection may also be playing a role. Lastly, the authors see some indication that ACOs strongly emphasizing primary care are having greater success than their peers.

The Milliman team involved in this study will be presenting their findings in a new HealthcareWebSummit webinar: Key Drivers of ACO MSSP Results - What Predictive Analytics Can Tell Us, to be held Thursday, November 18^th, 2021 at 1PM Eastern.

The 2021 Medicare Trust Fund Report by The Numbers

By Clive Riddle, September 2, 2021

What is the state of the Medicare Trust Fund, by the numbers? $900 billion in income and $926 billion in  expenditures provided for the 62.6 million Medicare beneficiaries, with the Part A fund projected to be depleted in 2026, and current running at 4.0% of GDP that will increase to 6.5% before the end of this century.

Earlier this week, the 255-page 2021 Medicare Trust Fund report was released, which of course found that  in 2026  for Medicare Part A, “the fund's reserves will become depleted and continuing total program income will be sufficient to pay 91 percent of total scheduled benefits.”

The supplemental trust fund accounts - Part B and Part D, are "adequately financed into the indefinite future because current law provides financing from general revenues and beneficiary premiums each year to meet the next year's expected costs. Due to these funding provisions and the rapid growth of its costs, SMI will place steadily increasing demands on both taxpayers and beneficiaries."

The fund projections "have been significantly affected by the pandemic and the recession of 2020. Employment, earnings, interest rates, and GDP dropped substantially in the second calendar quarter of 2020 and are assumed to rise gradually thereafter toward full recovery by 2023, with the level of worker productivity and thus GDP assumed to be permanently lowered by 1 percent even as they are projected to resume their pre-pandemic trajectories. In addition, the Trustees also project elevated mortality rates related to the pandemic through 2023 (15 percent for those over age 15 in 2021, declining to 1 percent by 2023) as well as reductions in immigration and childbearing in 2021-22 from the levels projected in the 2020 reports, with compensating increases a few years later."

The report projects that for total Medicare expenditures as a percentage of GDP will increase from 4.0 percent in 2020 to 6.5 percent by 2095.” Here’s a graph of Medicare percent of GDP provided in the report, historical and projected, for this century:

Setting aside fund projections for now, perhaps the item of more immediate interest in the report is the Medicare fund snapshot for the year just completed, providing a view of the $900 billion total fund income, and $926 billion total fund expenditures for 2020, provided for the 62.6 million Medicare beneficiaries:

We compiled the fund benefits for 2020 and 2019, excluding Part C (Medicare Advantage, etc) to provide a comparison of percentage of benefit expenditures by category before (2019) and during (2020) the pandemic. The big change is in the “Other” category, which as the report footnotes “Includes the impact of the Accelerated and Advance Payments Program, which was significantly expanded during 2020 due to the COVID-19 pandemic. Total payments of $107.1 billion were made from the HI trust fund and the SMI Part B trust fund account.” Thus the $99.9 billion increase in “Other” from 2019 to 2020 is explained by these pandemic program payments.

Postcards From the Drug Pricing Trail

By Clive Riddle, July 16, 2021

President Biden’s recently released Executive Order on Promoting Competition in the American Economy included provisions regarding prescription drugs, first stating that “Americans pay more than 2.5 times as much for the same prescription drugs as peer countries, and sometimes much more. Price increases continue to far surpass inflation," and that "these high prices are in part the result of lack of competition among drug manufacturers."

The Executive Order:

• Directs the Food and Drug Administration to work with states and tribes to safely import prescription drugs from Canada, pursuant to the Medicare Modernization Act of 2003.
• Directs the Health and Human Services Administration (HHS) to increase support for generic and biosimilar drugs, which provide low-cost options for patients.
• Directs HHS to issue a comprehensive plan within 45 days to combat high prescription drug prices and price gouging.
• Encourages the FTC to ban “pay for delay” and similar agreements by rule.

With respect to drug pricing, its interesting that three days before the Executive Order was released, a USC study "comparing Medicare Part D prescription drug prices with those paid by Costco members finds that the federal government overpaid on roughly half of the most common generic medicines in 2018. The findings suggest that policymakers should take a closer look at the practices of intermediaries who effectively negotiate drug prices on behalf of Medicare but don’t necessarily pass on the savings to beneficiaries and taxpayers."

The study: Comparison of Spending on Common Generic Drugs by Medicare vs Costco Members, was published this month in Jama Internal Medicine, and found:

• Across more than 1.4 billion Medicare Part D claims for 184 products, Medicare plans overspent by 13% in 2017 and almost 21% in 2018 compared to Costco member prices.
• Medicare plans paid more than Costco members on almost 53% of 90-day fills analyzed in 2018. On all 30- and 90-day prescription fills, Medicare plans overpaid 43% of the time.

On the front lines of the drug-pricing front, GoodRx tracks the manufacturer drug price hikes that happen every year in January and July, and recently published  their update on July 2021 Drug Price Increases. They noted that “last July, 67 drugs increased in price by an average of 3.1%, compared to 2019, when 37 brand drugs increased by an average of 4.3%.” So far this July, they have tracked 64 brand drugs increasing an average of 3.5%; 1 generic drugs increasing 0.3%, for an overall total of 65 drugs increasing an average of 3.5%. Topping the price increase list was Zolpimimist from Aytu BioPharma at 15.9%.

For perspective on individual drug costs from a volume standpoint, the ClinCalcDrugStats Datbase  listing of the top 200 drugs of 2021 by volume is headed by Atorvastatin (cholesterol) which had 112.5 million U.S. prescriptions in 2018, at an average total drug cost of $50.97 per prescription ($1.00 per day of therapy) with covered patients paying an average $7.32 in cost-sharing. Number two was Levothyroxine (thyroid) which had 105.8 million U.S. prescriptions in 2018, at an average total drug cost of $25.14 per prescription ($0.50 per day of therapy) with covered patients paying an average $12.50 in cost-sharing.

But the high volume prescription costs haven’t been the chief driver of overall cost increases for some time. The oft-cited culprit are specialty drugs. One report, released last month:  the AMS 2020 Specialty Drug Trends Report, found that:

• Fewer than 2% of the U.S. population utilized specialty drugs
• Specialty drugs account for more than half (51%) of total drug spend
• 80% of annual medical trend increases were driven by specialty drug costs
• The top 10 Medicare Part B covered drugs accounted for 2% of all covered products but 43% of total Part B drug spending

And You Thought Health Insurance Was Bad

By Kim Bellard, January 28, 2021

I spend most of my time thinking about health care, but a recent The New York Times article — How the American Unemployment System Failed — by Eduardo Porter, caught my attention. I mean, when the U.S. healthcare system looks fair by comparison, you know things are bad.

Long story short: unemployment doesn’t help as many people as it should, for as much as it should, or for as long as it should.

It does kind of remind you of healthcare, doesn’t it?

The pandemic, and the associated recession, has unemployment in the news more than since the “Great Recession” of 2008 and perhaps since the Great Depression. Last spring the unemployment rate skyrocketed well past Great Recession levels, before slowly starting to subside. Still, last week almost a million people filed for unemployment benefits, reminding us that unemployment is still an issue.

Mr. Porter reports:

· “In 2019, only 27 percent of unemployed workers received any benefits, a share that has been declining over the last 20 years.

· The benefits have eroded as well, to less than one-third of prior wages, on average, about eight percentage points less than in the 1940s.”

The states range from 58% of unemployed workers in New Jersey who receive benefits to 9% — 9%! — in North Carolina. Robert Moffitt, a Johns Hopkins economics professor, told Mr. Porter: “The program was set up to have tremendous cross-state variation. This makes no sense. It creates tremendous inequities.”

As with our healthcare system, “broken” isn’t really a good description. Each is working the way they’ve been designed. Unfortunately, if you’re poor or sick, and especially if you are both, they’re not designed to help you. Not until the poor and sick start making significant campaign contributions anyway, or at least vote in larger numbers.

Many unemployed workers, of course, also lose their health insurance when they lose their jobs, since ours is a predominantly employer-based health insurance system. As many as 15 million people may have lost their employment-based coverage due to the pandemic. If they work for the right kind/size of employer, they may be eligible for COBRA coverage, but paying for it may be difficult, between loss of employer contribution, low UI benefits, and delays in receiving UI.

At least under ACA they may have coverage options, including subsidies, through the Marketplace or Medicaid, — unless they live in one of the states without Medicaid expansion.

Even in the states that have expanded Medicaid, the economic crisis has hit their tax revenue severely, while increasing the number of Medicaid enrollees, creating a double whammy. The same, of course, is happening with the money to pay unemployment benefits, causing almost half the states to ask for federal loans.

In other words, when we have the worst crises — like a pandemic — both our unemployment insurance and our health insurance systems do worst. Those are the times we rely most on the government, but our federalism system of shared federal/state responsibilities is failing the latest crisis.

Mr. Porter sees hope:

Perhaps there is an upside to the current crisis: The glaring insufficiencies of the regular unemployment system may encourage states and the federal government to undertake comprehensive changes.

Perhaps. If the pandemic continues long enough — as it might — it might force deep structural changes. So far, the various relief bills have just added more patches to our patchwork quilt approach towards UI. But if in the coming months vaccines mitigate the impact, and the economy picks up, then our typical reaction will be to commission some studies and just kick the can further down the road.

ACA made our health insurance system less patchwork, with more uniform requirements, more subsidies, less discrimination against preexisting conditions, and broader Medicaid options. The Biden Administration may, and should, further improve these. Let’s hope that it takes a hard look at how it can do something similar with unemployment insurance.

This post is an abridged version of the original posting in Medium. Please follow Kim on Medium and on Twitter (@kimbbellard)

Healthcare’s Bridge Fire

By Kim Bellard, November 17, 2020

We had a bridge fire here in Cincinnati last week. Two semis collided in the overnight hours. The collision ignited a blaze that burned at up to 1500 degrees Fahrenheit and took hours to quell. Fortunately, no one was killed or injured, but the bridge remains closed while investigators determine how much damage was done. It is expected to remain closed for at least another month.

Unfortunately, the bridge in question is the Brent Spence Bridge, which is the focal point for I-71 and I-75 between Ohio and Kentucky. It normally carries over 160,000 vehicles daily, and is one of the busiest trucking routes in the U.S. Over $1 billion of freight crosses each day. There are other bridges nearby, but each requires significant detouring, and none were designed for that traffic load.

What makes this all so galling is that it has been recognized for over 25 years that the bridge has been, to quote the Federal Highway Administration, “functionally obsolete” — yet no action was taken to replace it. This most recent disaster was a disaster hiding in plain sight.

Just like, as the coronavirus pandemic has illustrated, we have in health care.

Epidemiologists had long warned of a global pandemic. The Obama Administration prepared a detailed “playbook” for such a pandemic, but, nonetheless, the Trump Administration was caught flat-footed when COVID-19 hit.

Our global, just-in-time systems for supplies was found severely wanting in the case of an exponentially spreading global pandemic, leaving healthcare workers short of essential protective gear and equipment like ventilators. Similarly, our testing efforts were botched from the beginning.

As we’ve learned, COVID-19 hits people with comorbidities hardest; as we’ve long known, the U.S. leads in world in people with chronic conditions. It has also disproportionately impacted people of color — reflected, in part, their increased likelihood of being essential workers who cannot work from home, and underlying health disparities.

Just within the past week, we’ve received promising news on vaccines from Pfizer and Moderna. Unfortunately, vaccine development has become politicized.

We’ve thrown trillions of dollars at COVID-19 relief, including large amounts to the healthcare system, yet hospitals claim they are losing hundreds of billions of dollars, and our already weakened system of primary care is on the verge of collapse. Burnout among healthcare workers was already a problem, but the pandemic has caused it to reach new levels, especially when many people shun basic precautionary measures like masks or social distancing.

It’s embarrassing that in the richest country in the world, 11% of the non-elderly lack health coverage. It is disturbing that 25% of Americans report that they or a family member have put off treatment for a serious medical condition in the past year due to cost — and that was before the pandemic.

All of which is to say, the pandemic is a bridge fire, all right, but it is taking place on a healthcare bridge that we’ve long known is “functionally obsolete.”

We can’t entirely avoid bridge fires, but we can design the bridges to minimize their likelihood and can ensure they are structurally sound enough to withstand them. Similarly, we can’t preclude the possibility of a pandemic, but we can have the public heath infrastructure in place for one, and a healthcare system that is robust enough to cope with one.

What we can’t do — or, rather, what we shouldn’t do — is to wait for disasters to happen and only then try to figure out what to do.

The pandemic may be healthcare’s bridge fire, but it didn’t cause our healthcare system’s shortcomings; it only helped expose them. The question is, will it spur us to do something about them?

This post is an abridged version of the original posting in Medium. Please follow Kim on Medium and on Twitter (@kimbbellard)

Not Just Faxes

By Kim Bellard, October 21, 2020

I missed it when it was first announced in Japan, but fortunately the U.S. mainstream media has finally picked up on the story, with articles in both The Washington Post and The Wall Street Journal: Japan’s new Administrative Reform Minister Taro Kono has “declared war” on fax machines, among other paper-based traditions.

Wait, what? “Administrative Reform Minister?” The U.S., or at least the U.S. healthcare system, has to hear about this.

Mr. Kono set up a hotline for people to report government red tape, which was quickly overwhelmed with thousands of examples. It soon reopened.

It didn’t take long for Mr. Kono to start calling for significant changes. “To be honest, I don’t think there are many administrative procedures that actually need printing out paper and faxing,” he said in a press conference in late September. “

Part of the problem in Japan is the hanko, a personal stamp that is routinely used for authentication (and which thus requires paper.)

If you’ve ever envied Japan for its bullet trains, its early adoption of robots, or its broad use of consumer electronics, you may be surprised to hear that more than 95% of Japanese businesses still use faxes, and 34% of Japanese households have a fax. Mr. Kawaguchi admitted: “It may be 1970s technology, but it is extremely secure and very difficult for someone on the outside to hack…Digitisation may make things more efficient, but there is clearly a trade-off when it comes to security.”

Not surprisingly, the COVID-19 pandemic has been a big driver in the anti-fax initiative. Health care professionals were overwhelmed by the amount of reports that had to be prepared by hand and then faxed. “Come on, let’s stop this already,” one physician tweeted. “Even with corona, we’re handwriting and faxing.” Mr. Kono quickly retweeted it, even though he was still in his former position as Defense Minister — and within a week the health ministry announced a system of online filing (which, not surprisingly, has not entirely succeeded).

An independent report on Japan’s response to the pandemic found that their system “made it difficult to grasp the spread of infection in real time nationwide, and exhausted health center staff. The new coronavirus crisis was also Japan’s ‘digital defeat.’”

We don’t have hankos in the U.S., and we’re not as reliant on faxes as Japan is, even in our healthcare system. But red tape, inefficiencies, and antiquated technology? Yeah, we’ve got all that, especially in healthcare. But where’s our Secretary of Administrative Reform? Where are our Chief Administrative Reform Officers?

Heck, where are our hotlines to report red tape?

Even now, well over six months into our pandemic response, we have a slapdash, state-by-state (or even county-by-county) system of reporting, with hospitals and HHS still struggling to figure out what and how to report.

Yoshimitsu Kobayashi, chairman of Mitsubishi Chemical Holdings, sees the pandemic as an opportunity: “The very negative damage it has inflicted on Japan has in turn served as a powerful accelerator. If we miss this chance, we won’t be able to do it next time.”

Economist Paul Romer is usually credited with the quote, “A crisis is a terrible thing to waste.” Well, we certainly have a crisis, and I’m worried we’re going to waste it. Using it to just get rid of faxes would be a waste. We’re already using it to streamline development of therapeutics and vaccines, although not without problems. But will we use it to solve fundamental problems in our healthcare system, such as inequities, inefficiencies, and infrastructure?

Maybe we could recruit Mr. Kono to do the job.

This post is an abridged version of the original posting in Medium. Please follow Kim on Medium and on Twitter (@kimbbellard)

Six Takeaways from a New White Paper for Payers on Pandemic Driven Medicaid and ACA Expansion

by Clive Riddle, August 21, 2020

Change Healthcare has just released a 13-page white paper: Pandemic-Driven Medicaid and ACA Expansion: Impacts and Considerations for Payers, that "details expected changes in the composition of national Medicaid and ACA member populations, and explores the potential financial consequences of the pandemic on payers."

Here are six takeaways from their report:

1. Five states with the biggest percentage jump in Medicaid enrollment from Feb 2020 to May 2020: Florida - 9.8%, Missouri - 8.8%, Wisconsin - 8.5%, Minnesota - 8.4%, Kentucky - 8.1%
2. Of those with employer-sponsored -care that are losing coverage, nearly half are eligible for Medicaid, and an additional 31% are eligible for marketplace subsidies.
3. Expect enrollment backlogs: “Typically, a new Medicaid member is assigned to a Managed Care Organization (MCO) within 45 days after enrolling. Current processing backlogs indicate that window will likely expand significantly and it might be 60 to 90 days before members can receive care through an MCO after enrollment—and that is dependent on the availability of healthcare services.”
4. Expect utilization backlogs: ”we expect the most dramatic impact of Medicaid member utilization to hit in 2021, when care services are likely to be more widely accessible.”
5. Coverage will shift back: “As the economy rebounds, coverage will likely shift back to commercial lines of business and payers should be prepared for continual changes in coverage for the foreseeable future.”
6. Five strategies are recommended payers mitigate challenges caused by the pandemic: 

• Prepare your infrastructure by expanding provider networks to increase capacity; expect and plan for payment delays from financially unstable states.
• Collaborate with providers to ensure that members who are most at-risk receive access to necessary healthcare services.
• Accurately identify primary healthcare insurance coverage to reduce exposure and avoid costly recoveries.
• Identify and capture missing risk-adjusting diagnostic codes for members by year’s end, using technology to close risk gaps and validate claims before submission.
• Aggressively manage risk scores by identifying members in need of documentation and proactively facilitating care visits by the end of the calendar year.

Healthcare Needs Some #GoodTrouble

By Kim Bellard July 22, 2020

As hopefully most of you know, Rep. John Lewis, civil right icon and longtime member of Congress, died this past Friday. Rep. Lewis was often described the “conscience of Congress” — perhaps a low bar in today’s Congress but important nonetheless — for his unwavering commitment to social justice.

Rep. Lewis must have been heartened by the fact that, in 2020, plenty of people are, indeed, making noise and getting into good trouble, necessary trouble over issues that he cared deeply about, like Black Lives Matter and voting rights. There are others who are better able to write about those people and that trouble. So I’d like to talk about his call to action with respect to healthcare.

If you are working today in healthcare — especially in the United States — or, for that matter, someone getting healthcare or having a loved one get it, then you should be making some noise and getting into good trouble, because our healthcare system most definitely makes it necessary.

Every day, too many of us suffer in the healthcare system, ranging from waits to indignities to critical mistakes, and some face financial ruin due to the care — whether good or bad. Most of us suffer in silence, or only complain to our friends and family. We don’t see a lot of mass protests about the pitiful state of our healthcare system, and I have to wonder why.

We have to stop being so passive.

For those of you working in healthcare, here are the first two things I’d urge you to get into good trouble about:

•         Stop doing stupid stuff
•         Do simple better

The first admonition comes from a movement developed by Melinda Ashton, MD at Hawaii Pacific Health. She started asking front-line workers to identify things that were “poorly designed, unnecessary, or just plain stupid,” and — not surprisingly — there turned out to be a lot.

The second comes from advice that Dan Gingiss gives about improving customer experience. Our healthcare system is the world’s largest Rube Goldberg machine, complicated beyond understanding and with much of that complexity not achieving intended goals.

Yet we continue to add complexity, layering new technologies onto old, inserting new layers and new types of intermediaries, all of which adds costs. Even things that aren’t inherently stupid are usually more complicated than is absolutely essential.

Before we make things even more complicated, we should focusing on making the simple things better. Who is getting into good trouble about that?

If the leadership at your healthcare organization doesn’t resemble the workers in it, or, equally important, the people receiving care from it, then you should be making noise. That’s worth getting into good trouble about. That’s necessary trouble.

Or take prices. As expensive as our healthcare system is, we’ve known for a long time that our problem isn’t getting too many healthcare service as it is the prices we pay for them. If you’re working in a healthcare organization that charges the people without health insurance much more, you should be making noise. If your organization is also suing those patients to collect the resulting debts, you should be getting into good trouble to try to stop it.

And, of course, if you are working in a healthcare organization where you see patients getting services they don’t actually need, or, worse yet, delivering substandard care, then you really should be making noise and getting into good trouble. That is definitely necessary trouble.

But it’s not only those working in healthcare. If you or your loved one is receiving care, you should be making noise when you aren’t treated with respect, or when you don’t get the information you need.

We can’t be afraid to make some noise about healthcare. We must be willing to make good trouble about the many, deep, and pervasive problems in our healthcare system. If that isn’t necessary trouble, I don’t know what is.

This post is an abridged version of the original posting in Medium. Please follow Kim on Medium and on Twitter (@kimbbellard)

The Relationship (or lack thereof) Between COVID-19 State Restrictions and Prevalence

By Clive Riddle, July 10, 2020

Wallet Hub earlier this week released updated rankings of States by Coronavirus Restrictions. The rankings were based on data available on July 6^th, and assigned scores based on 18 metrics including “whether the state has any penalties for non-compliance with COVID-19 legislation to whether the state has required face masks in public and health checks at restaurants.”

They found the five least restrictive states – in order – to be South Dakota, Wisconsin, Utah, Wyoming and Oklahoma. They found the five most restrictive states – in order – to be California, Colorado, Hawaii, New Jersey, and New Mexico.

We thought it would be interesting to compare their rankings to COVD-19 prevalence, using current CDC deaths and cases per 100,000 population rates by state. The question to examine, if is there is a relative relationship between the levels of restrictions and COVID-19 deaths and cases per capita. The spreadsheet we compiled is provided below.

We reversed the rankings provided by WalletHub. They ranked states by the least restrictive – South Dakota was #1, California was #51. But in comparing Death and Case Rates where #1 would be the highest rates, we decided to rank states by the most restrictive – with the hypothesis that the most restrictive states should have the greatest prevalence.

The results were very mixed – you can select certain states to make whichever case you want. To go with the above hypothesis – you can point to Atlantic states like New Jersey, New York, Delaware and Maryland – all with a close relationship between their high levels of restrictions and high COVID-19 prevalence. You can also point to Wyoming on the other end of the scale that lines up #48 in restrictions, #48 in death rates and #44 in case rates.

On the other hand, there is Hawaii ranking third in most restrictions, but lowest in the nation in death and case rates, bolstering those who want to argue that imposing restrictions up front can result in lower prevalence (or an argument to move your state to an island.) MaIne also can make such a case – ranking 6^th in restrictions but 43^rd in deaths and 45^th in cases (or perhaps a case to move your state further north than Toronto.) But on still another hand, California is less compelling, ranking first in restrictions but 30^th in deaths and 29^th in cases (California had a compelling case that deteriorated during the past month.)

And California’s deterioration of course highlights the problem that this exercise doesn’t address – the greater importance of recent change rates vs cumulative rates, and the impact of changes in restrictions. But for now, examining relationships between state approaches, and state incidence of COVID-19, is like everything else to do with the virus – quite a mess.

Time Really Can Be Money

By Kim Bellard, February 26, 2020

If you are not an IKEA fan, or haven’t been spending any time in Dubai, you may have missed the chain’s marketing campaign to help promote its second store in the area. Titled “Buy With Your Time,” customers got store credits for how long they spent getting to the store.

Gosh, that’s something that should make any self-respecting critic of the U.S. healthcare system perk up. Count me as intrigued.

The campaign involved checking the customer’s Google Maps’ Trip tab to determine how long it took them to get to the store. IKEA benchmarked the average hourly wage in Dubai, and converted the travel time into how much credit they’d generated. It works out to about $29/hour, or $0.48 per minute. Spend long enough getting there and you could get a free coffee table or even a bookcase. Prices in the store include the equivalent time currency.

It is believed to be the first time a retailer is letting customers use their time as a means of payment. The program seems to have been a success.

I love this campaign for a couple reasons. One is the concept that it recognizes that, yes, our time is valuable, and not just in a lip service sort of way. The second is that “money” is a broader, more elusive, concept than the formal forms of currency that we usually use.

Healthcare should be thinking about both of those.

Travel is often not a prime consideration in healthcare, with medical tourism and centers of excellence still not achieving mainstream status. We like our healthcare local, failing to recognize that, for most of us, local is far from the best care we could get. But what if, taking a page from Ikea’s campaign, the time we spend traveling to — and taking off work for — sources of higher quality care translated into credits that we could use to pay for that care?

More important than travel time is the waiting. I have railed before about how the healthcare system often treats our time almost contemptuously. As I put it previously, we wait to get appointments, we wait at appointments, we wait during appointments, we wait for results after appointments, and, if we’re in a hospital or nursing home, we spend most of our time waiting.

Healthcare should be valuing the time we spend in the system waiting for something to happen. Some parts of the healthcare system seem to track and report waiting time — e.g., urgent care centers or emergency departments come to mind — but they don’t seem to do much with that information.

Imagine instead of paying health insurance premiums we accrue credits for our good health behaviors, which can be redeemed when we need some sort of intervention to maintain or improve our health. Ikea couldn’t have done its campaign without Google Maps, and we’re getting close to the kind of 24/7 tracking options that would allow for us to determine and manage such credits.

The problem will be that no existing entities in the healthcare system are really equipped (or incented) to administer such an approach, opening the door to new types of market entrants. Maybe we should ask the people at IKEA…

IKEA’s effort may just have been a clever gimmick to promote a new store in an isolated location, but there are lessons to be learned from it nonetheless. As Mr. Aten suggested, turning pain points for the customer into a win for the customer is, in fact, a win. If there is something that we can all agree on, it is that healthcare has too many pain points for its customers. The question is: how can we turn them into wins for those customers?

This post is an abridged version of the original posting in Medium. Please follow Kim on Medium and on Twitter (@kimbbellard)

SDoH, Chronic Care, Reinsurance, Pools and Doughnuts

By Clive Riddle, February 13, 2020

I gave a presentation recently to a healthcare group on the state of the business of healthcare in 2020, and in the ensuing reactor panel discussion, the topic of return on health plan investment in longer range initiatives such as in SDoH or applicable chronic care management programs came up.

For Medicare programs, plans can have the motivation to invest in programs that may take years to generate material improved outcomes and resource savings for individual patients – as they potentially can keep these patients enrolled for the duration. But with Medicaid and commercial programs, there is ongoing turnover – employees change jobs and individual Medicaid eligibility is subject to change.

Thus a plan that invests in long range programs for their covered Medicaid and commercial populations, may not retain specific individual members long enough to reap the improved outcomes and savings for those specific individuals. An SDoH investment might get a specific member on a better footing to improve their health, but then the member loses eligibility with that plan for a variety of reasons – loss of Medicaid eligibility, loss of a plan’s Medicaid contract, change of employer, change of plan during open enrollment, etc. Programs to improve certain chronic conditions or effect lifestyle or behavioral changes have the same challenge.

Many plans are investing in SDoH at least partly through a philanthropic perspective – typically providing funding through their plan’s affiliated foundation to designated Community Based Organizations that may serve some of the plan’s members, but also serve other segments of the population as well. Here’s some headlines during the past month in this regard:

• Anthem Blue Cross and Blue Shield Activates $3.6 Million Across Ohio in 2019
• CareFirst Contributed $43 Million To Health Initiatives in 2019
• Kaiser Permanente pledges $5.1M in 2020 to reduce homelessness
• Blue Shield of California Promise Health Plan Awarded $1.1 Million

But what if there was pooled funding mechanism for SDoH and eligible long-range chronic care management programs for pre-Medicare populations, Plans could refer members into applicable programs, and uninsured patients could participate as well. Plans could have allocated contribution requirements, along with other sectors providing funding.

Think of it as reinsurance pooling on the other end of the spectrum. In fact, a case can be made for advancement of pooling on both ends of the spectrum. Patients meeting catastrophic case criteria would transfer to coverage by kind of catastrophic “Medicare for All” plan. Plans would provide funding for the pooled plan, along with public funding, and uninsured could qualify as well if they met the criteria.

Between the pooled SDOH/Chronic Care programs, and pooled Catastrophic program, would be the doughnut hole filled by our quilt of current health care coverage.

Reinsurance pooling, while not as for along as a catastrophic Medicare for All program, does exist. Much of such efforts focus on the state ACA individual coverage markets. The Center on Budget and Policy Priorities published this paper last April covering the topic:  Reinsurance Basics: Considerations as States Look to Reduce Private Market Premiums. And for example, last August, CMS “approved Montana’s plan to create a reinsurance pool that aims to help lower individual health insurance premium costs.”

Pooled funding for SDoH programs is also not a new idea.  Back in 2016, the Public Health Institute published this paper: When Tackling the Social Determinants of Health, Pooling Funding Streams Is the Wise Course, stating “It seems like a logical approach to tackling tough social problems: coordinate across agencies, pool funds, and take aim at the issues from all angles. In practice, that rarely happens, but not for want of trying.”

You’ll also find the topic addressed in this February 2015 paper from the Center for Health Care Strategies: State Payment and Financing Models to Promote Health and Social Service Integration, and in this Institute for Medicaid Innovation January 2019 paper:  Innovation and Opportunities to Address Social Determinants of Health in Medicaid Managed Care.

In fact, while a December Health Affairs Blog piece Health Conundrum: How State Budgets Can Find The Balance Between Social Versus Medical Services  by Shannon Brownlee, Vikas Saini, and Benjamin F. Miller is skeptical that SDoH investment can lower spending – “there are several reasons to doubt this argument, if only because rising prices for medical services are driving national health care expenditures more than rising medical need” – they do go on to advocate pooled funding.

They authors state “in our report, we recommend that the California state government, and by implication all state governments, serve as a catalyst for multiple co-ventures of this type. States can convene all stakeholders, including health care institutions, health plans or payers, social service providers, community development financing institutions, and public health officials. They can also commission research, create the infrastructure for pooled funds for investing in community conditions, and draft new community benefit regulations for hospitals that would bring nonprofit health care providers to the table with funds to offer.”

So – food for thought - about programs that think about food as part of the solution, and doughnut holes between pools.

The CMS Innovation Center: Innovative Savings Projections?

Avalere has released a report: CMMI’s Financial Impact on Medicare Spending Challenging to Project, which concludes “CMMI’s impact on Medicare spending has not reached earlier projections by the Congressional Budget Office (CBO), demonstrating the difficulty in projecting savings from untested and future unknown alternative payment models.”

Before we delve into the details of Avalere’s findings, let’s take a step back and peek into what goes on these days at The Center for Medicare & Medicaid Innovation (CMMI), which they now like to refer to as the CMS Innovation Center.

The CMS Innovation Center tells us they develop new payment and service delivery models brought about by the Affordable Care Act and other legislation, overseeing a number of specific demonstrations to be conducted by CMS; and implement the Quality Payment Program brought about by MACRA. The demonstrations and QPP were developed with an underlying assumption of savings to be accrues, and Avalere is now finding the savings have missed their targets.

The CMMI site provides tables itemizing the Alternative Payment Models in the Quality Payment Program, which list 50 specific Alternative Payment Models (APMs), plus Other Payer Advanced APMs including 7 Medicaid Other Payer Advanced APMs; 59 Medicare Health Plan Payment Arrangements; and 2 CMS Multi-Payer Payment Arrangements.

The CMMI Site indicates 90 specific demonstration models, which fall under seven categories:

1. Accountable Care
2. Episode-based Payment Initiatives
3. Primary Care Transformation
4. Initiatives Focused on the Medicaid and CHIP Population
5. Initiatives Focused on the Medicare-Medicaid Enrollees (dual eligible)
6. Initiatives to Accelerate the Development and Testing of New Payment and Service Delivery Models
7. Initiatives to Speed the Adoption of Best Practices

Given this scope, Avalere tells us that "CBO’s 2010 projection was $1.3 billion in net federal government savings from CMMI over the 2010-2019 budget window. In 2015, CBO began projecting more substantial savings from CMMI: $27 billion in net federal government savings over the 2016-2025 budget window; and then in 2016, $34 billion in net federal government savings over the 2017–2026 budget window."

Avalere however “estimates net Medicare savings of $18.0 billion from CMMI for the 2017-2026 budget window, lower than the $34 billion projected by the CBO in 2016. Net Medicare savings reflects expected reduced Medicare program expenditures net of CMMI outlays.” They break down their projection as follows:

1. The continuation and expansion of already-existing CMMI demonstrations generate $4.4 billion in gross Medicare savings between 2017 and 2026. 
2. Proposed demonstrations generate $21.4 billion in gross Medicare savings for 2017–2026. 
3. CMMI will launch new, not yet proposed demonstrations that generate $3.3 billion in gross Medicare savings for 2017–2026.

Of course, the aftermath of a Presidential election year could bring about any number of scenarios that could spin CBO or Avalere projections sideways.

ACA Exchange 2020 Final Rule Changes and Survey of Exchange Health Plan Participation and Expectations

By Clive Riddle, May 31, 2019 

Last month CMS issued their final rule with ACA benefit and payment parameters for 2020. Their changes for 2020 included: 

• The method for calculation of premium assistance for lower-income enrollees (projected to lower the total amount of financial assistance provided by $900 million, when compared with 2019, and result in 100,000 fewer exchange enrollees in 2020.)
• Allowing plans to make mid-year changes to their drug formularies
• Allowing plans to implement cost-sharing requirements if enrollees choose a brand-name drug when a medically appropriate generic version of the drug is available (even when out-of-pocket spending maximum is reached)
• Allowing plans to implement copayment accumulator programs for prescription drugs
• Lowering user fees for the 2020 coverage year by half a percentage point
• Increases maximum out-of-pocket spending limits by 3.2%, from $7,900 to $8,150 for individual plans and from $15,800 to $16,300 for family plans      

How will these changes, and overall market forces, impact health plan participation in the ACA exchanges for 2020? eHealth has just released survey results from 17 plans that collectively cover 80 million lives that participate in ACA exchanges, that found “more than twice as many insurers intend to increase plan offerings for 2020 as compared with 2019, with premiums holding fairly steady.”

Here’s some of their detailed findings: 

• 45% intend to add to the number of ACA plans they'll offer in 2020, compared to 21% who did so for the 2019 plan year
• 42% expect to raise premiums between 5 and 10 percent over 2019 rates. 33% do not expect to make any noteworthy changes to premiums, while 23% expect to reduce monthly premiums by 5 percent or more.
• 69% said that sales during the last open enrollment period were within 10 percent of their expectations. 15% reported that sales outpaced expectations by 10 to 15 percent, while another 15% of said sales were 10 percent or more below expectations.
• 71% said they are paying attention to public discussions about "Medicare for all" but don't expect major changes, compared to 67% in 2018

CBO: Coverage by Oration

by Clive Riddle, May 3, 2019

 The Congressional Budget Office has been quite busy as of late, preparing reports that can serve as reference resources in response to Orators residing in Congress, the White House and the campaign trail, that are espousing healthcare coverage policy proposals, whether those proposals being orated involve Medicare for All, Medicare for Some, Death to the ACA, or other such schemes.

On May 1^st, the CBO released a 34-page report:  Key Design Components and Considerations for Establishing a Single-Payer Health Care System, serving as a roadmap that “describes the primary features of single-payer systems, and it discusses some of the design considerations and choices that policymakers will face in developing proposals for establishing such a system in the United States.”

The report is organized by these categories of components and design considerations: 

• How would the government administer a single-payer health plan?
• Who would be eligible for the plan, and what benefits would it cover?
• What cost sharing, if any, would the plan require?
• What role, if any, would private insurance and other public programs have?
• Which providers would be allowed to participate, and who would own the hospitals and employ the providers?
• How would the single-payer system set provider payment rates and
• purchase prescription drugs?
• How would the single-payer system contain health care costs?
• How would the system be financed? 

In May 2^nd, the CBO released a 42-page report: Federal Subsidies for Health Insurance Coverage for People Under Age 65: 2019 to 2029, which “project that federal subsidies, taxes, and penalties associated with health insurance coverage for people under age 65 will result in a net subsidy from the federal government of $737 billion in 2019 and $1.3 trillion in 2029.”

 The report tells us that:

• Between 240- 242 million people are projected to have health insurance each month during 2019-2029. The number of uninsured is projected to rise from 30 million in 2019 to 35 million in 2029.
• Net federal subsidies for insured people will total $737 billion in 2019 and $1.3 trillion in 2029.
• Medicaid and CHIP account for 40 - 45 percent of the federal subsidies, Medicare accounts for about 10 percent, and subsidies for ACA marketplace coverage account for less than 10 percent.

On April 18^th the CBO provided a blog post: CBO Releases Four Products Explaining How Its New Health Insurance Simulation Model Works that describes how they generate estimates of health insurance coverage and premiums for the population under age 65, such as for the May 2md Federal Subsidies report.

 Also on April 18^th, the CBO released an 11-page report:  Health Insurance Coverage for People Under Age 65:  Definitions and Estimates for 2015 to 2018 that “explains how CBO defines health insurance coverage, describes how CBO combines data from various sources to produce estimates of different types of coverage in past years, and shows such estimates for the years 2015 to 2018.” 

The report:  

• Describes how CBO defines health insurance coverage (private and public) for people under 65 who are not institutionalized and who are not members of the active-duty military;
• Describes the individual data sources CBO uses to compile preliminary estimates of historical outcomes, and the limitations of those sources; and
• Compares preliminary estimates of historical outcomes with CBO’s integrated estimates of coverage (that are consistent with each other and that sum to accurately depict the total population) for 2015 to 2018.