healthcarethinktank

Accountable Care Organizations - Second Attempt

2011-10-24T13:51:00.000-07:00

Accountable care organizations (ACOs) are the keystone of PPACA (Obamacare) as far as restraining costs and improving quality.

Early this year there was great excitement about ACOs in the provider community, but the publication of the (first phase) Medicare ACO rules threw cold water on the concept.

The rules were at best complicated and convoluted and providers ran for the hills. The administration tried calming the fleeing providers with fast track and modified programs, without much success.

On October 20th the Obama administration published revised Medicare ACO rules. The "simplified" rules run 696 pages! Most of us are still reading and analyzing, but the response seems to be less one of fear and more one of disinterest - but time will tell.

The administration finally got smarter and announced modifications to antitrust policy so Obama's DOJ would not be wrecking the work of Obama's DHHS.

Bad news though, employers and insurers see the possibility of intense ACO activity as anti-competitive.

This is a mess.

IOM Recommendations

2011-10-08T17:53:00.001-07:00

The Institute of Medicine (IOM) an influential organization long known for criticizing health care providers and advocating reform, has issued process recommendations for deciding the "essentials" of health insurance plans. An essentials list is required by DHHS by 2014 for all health plans available on the state health exchanges. The essentials should balance quality of care with projected premium costs.

PPACA does specify ten (10) broad areas of coverage, but not a specific plan menu.

The IOM study was a disappointment to some because it did not specify benefits, as this would have been a good discussion starter and would have given DHHS some political cover. The IOM focused on an approach to making the decision, and it is to start with costs and then work into benefits.

IOM also suggested an annual review of the programs beginning in 2016, and some waiver flexibility for states to customize plans.

Not exciting, but very very important.

see: http://www.iom.edu/Reports/2011/Essential-Health-Benefits-Balancing-Coverage-and-Cost.aspx

Bundled Payments Proposal

2011-08-27T12:01:00.001-07:00

PPACA (Obamacare) included initiatives to create "bundled payment" plans for Medicare (which would likely encouraged bundled payment for other payers as well).

This week the CMS Innovation Center issued directives encouraging creation of four (4) models of bundling services.

Rather than paying for quantity of services, Medicare wants to pay for quality and outcomes (this can become problematic in elder care).

This could be one PPACA initiative that actually brings some significant results, or the bureaucrats could bungle it. Time will tell. For now providers are on board or even ahead of CMS, racing to get ahead of the changing revenue cycle.

There are significant business complications in making this shift, so we do not expect quick progress or instant success.

ACOs Becoming IPWACOCs?

2011-08-01T06:48:00.000-07:00

Accountable Care Organizations (ACOs) are the keystone of the Obamacare efforts to improve quality and control costs.

After considerable initial enthusiasm providers have cooled on the ACO concept, especially as envisioned by the Center for Medicare and Medicaid Innovations. Why? Apparently.....

* ACOs are very difficult to organize and assemble
* ACOs are very difficult to operate and manage
* ACOs are unlikely to provide gain sharing dollars higher than new administrative costs

So is there good news? Yes.

Providers appear to be picking various components of the ACO concept and creating new and innovative models for improving care and containing costs.

It is way too early to declare a trend or to make definitive statements, but it appears providers are creating Innovative Projects With ACO Characteristics, or IPWACOCs.

He4alth Insurance Exchanges

2011-07-14T05:55:00.001-07:00

The Obama administration has published draft rules for the formation and operation of Affordable Insurance Exchanges, a key element in the PPACA (Obamacare) plan to increase insurance coverage.

There is a 75 day comment and then more time to digest the comments before final rules are issued. Implementation is due by January 1, 2014.

See the rules here, 244 pages:

http://ofr.gov/OFRUpload/OFRData/2011-17610_PI.PDF

Physician Briefing Paper Number 1

2011-06-27T14:33:00.000-07:00

We have published our first Physician Briefing Paper. Click the title line to link to our library.

Obama Administration Mystery Shoppers

2011-06-27T14:26:00.000-07:00

If there is anything most health policy wonks and politicians agree on, it is the shortage of primary care physicians, a shortage that may get worse.

So now the Obama administration is setting out to prove what we already know, and likely to create a public relations attack on primary care physicians.

The administration has hired a research firm to employ mystery phone shoppers to call primary care offices with two versions of a script, one a insured patient script and the other a government funded patient script.

The purpose is to measure wait times for new appointments, and to look for discrimination against government-funded patients, particularly Medicaid patients.

The biggest burden will fall on front desk personnel, who are always too busy (I never asked an employee to do what I wouldn't, so I have worked the receptionist chair - gasp).

All this to prove what we already know. ????

ACO Update

2011-06-21T16:16:00.000-07:00

Accountable Care Organizations are the heart-and-soul of Obamacare quality and cost control initiatives. All is not healthy.

Ready – Fire – Aim

When the Center for Medicare and Medicare Innovation (CMMI) released the draft regulations for Medicare ACOs on March 31, 2011 the reaction was brutal. CMMI was publicly beaten like a rented mule, even by enthusiastic supporters of the ACO concept.

Criticisms included: 1) the rules are too complex 2) start-up costs will be much higher than CMMI estimates 3) the probably of achieving savings to share is small and 4) the time lines are too short.

The Empire Strikes Back

In May CMMI burst forth with two new models in an attempt to quiet critics (unlikely) and to improve participation.

Advanced Payment ACO

AP-ACOs are designed to share ACO shavings before the savings are created, in effect, an advance for start-up capital. No one has told us yet what happens if the AP-ACO never generates any savings.

Pioneer Model ACOs

CMMI is hoping large physician groups already involved in the Medicare physician group practice demonstration program will start ACOs before the 1/1/2012 start-up date.

CMMI jeopardizes this initiative out of the gate by setting a ridiculous deadline. The deadline has now been extended a slightly less ridiculous deadline of August 19th.

The Pioneer Model is more flexible than the original Medicare SSP-ACO model, and has rules for both regular and “rural” ACOs, but is practically restricted to existing integrated delivery systems capable of moving very, very quickly.

Physicians Move to Integrate

2011-06-21T16:15:00.001-07:00

Story in the Washington Post.. (c) Washington Post Co., 2011

http://www.washingtonpost.com/national/health-science/hospitals-courting-primary-care-doctors/2011/05/31/AGYutAcH_story.html?hpid=z1

Pharm Supply Chain Meltdown

2011-06-15T18:19:00.000-07:00

The pharmacy supply chain for many critical medications is melting down, with resulting shortages.

Why? The potential list so far:

1) ultra-cheap generics are no longer profitable to produce
2) an international supply chain does not work smoothly all the time
3) consolidation in the pharmaceuticals industry
4) hyper-regulation from the FDA since 2006 has disrupted the chain with little gain in safety

The hyper-regulation problem, involving both real safety issues and of course increases in paperwork is likely the biggest problem. The biggest problems seem to be in injectibles, including certain cancer and anesthesia drugs, which are being rationed if they can be found at all. Rationing and substitution seem to be the only short term solutions.

Non-compliant patients - what to do?

2011-06-05T13:05:00.000-07:00

Ask physicians and nurses about their biggest clinical problems and non-compliant patients will likely be near the top of the list.

And why should we care? Because non-compliant patients are huge cost drivers.

Ezekiel Emanuel (MD, PhD, NIH) estimates that one-third of U.S. health care costs are driven by diabetes, and we know a lot about controlling diabetes, but it is very dependent on the patient being compliant with diet and medications. We don't do so well on this. Ask a nurse.

Is there something about Americans that make us less compliant than we should be? Is our consumer culture a bad place to promote health? Is there not enough information? Are we stressed into non-compliance?

Whatever the reason, it is very costly for all of us.

Accountable Care "Smackdown" Part III

2011-05-17T12:00:00.000-07:00

The feds fight back - Yes We Can!

From modernhealthcare.com today, Berwick interview:

http://www.modernhealthcare.com/article/20110517/NEWS/305179959?AllowView=VW8xUmo5Q21TcWJOb1gzb0tNN3RLZ0h0MWg5SVgra3NZRzROR3l0WWRMZmJVZndHRWxiNUtpQzMyWmV1NW5zWUpibW8=

Accountable Care "Smackdown" Part II

2011-05-17T11:59:00.000-07:00

While the feds were developing regulations for Medicare ACOs, both the feds and the American Hospital Association were developing cost numbers for ACO start-ups.

Today the AHA published its preliminary numbers, listing 23 major competencies to form and operate a hospital-based ACO (the AHA has been generally supportive of reform efforts, seeing a grim future).

The AHA costs estimates ranged from 600% and 1400% higher than the DHHS-CMS estimates. Both estimates are preliminary, but that is a huge difference. In my opinion (without deep analysis) the federal estimates have the substance of cotton candy.

On the list of 23 competencies, some were for formation only but most for formation and operations (my own list was 13 major competencies for on-going operations). The ACO is a very complex business model.

If ACOs do not fly, the major objectives of PPACA (Obamacare) will be difficult if not impossible to achieve.

Accountable Care "Smackdown"

2011-05-13T11:06:00.000-07:00

The American Medical Group Association represents about 400 very large and sophisticated multi-specialty physicians groups, such as the Cleveland Clinic group and Intermountain (Utah) group.

The Obama administration had counted on these groups to be the first to create Accountable Care Organizations (ACOs), starting with Medicare ACOs in 2012 and then moving to full service ACOs. These groups were more likely to have the resources necessary to start an ACO.

On Wednesday the group announced probably 90% of its members would not participate, because the draft regulations issued March 31st were too prescriptive, too operationally complex, the move to risk sharing is too quick, the gatekeeper and risk management capabilities requirements too much, and the time lines too short. The AMGA consensus is the chance of success is close to zero, so why waste resources.

If the big 400 cannot chew through this and come up with a workable plan, neither will other physician groups. Based on our recent conference attendance many provider organizations are taking the slow down approach.

It appears today only very large very integrated systems owning all of the necessary providers will be in the first wave. This could change for the better, but we doubt it. This could change for the worse though.

Not enough ACOs, no significant cost savings with quality improvement, no deficit improvement, train wreck.

The Wave of the Future? ACOs?

2011-03-23T12:16:00.000-07:00

Having recently plowed through about hundreds of pages on Accountable Care Organizations (ACOs) and Integrated Delivery Systems (IDSs), we should know how to define an ACO.

But not exactly.

This is critical because the Obama administration expects to garner huge savings from providers working through ACOs, beginning for Medicare in 2012 (building such systems in less than 9 months is going to be a Herculean task)..

The best formal definition we have seen to date, and it is very general, is the CMS definition for Medicare ACOs, and I quote:

Q: What is an "accountable care organization."

A: An Accountable Care Organization, also called an "ACO" for short, is an organization of health care providers that agrees to be accountable for the quality, cost and overall care of [Medicare] beneficiaries who are enrolled in the traditional fee-for-service program who are assigned to it (ACO).

It is a start, barely. The ACOs are supposed to be in place 1/1/2012. Administrative regulations were issued in November 2010 and the public comment period ended recently.

In a recent speech DHHS Sec. Berwick offered these "flag and apple pie" characteristics, still very general:

the patient and family will be at the center;
teamwork will now become “paramount;”
respect resources and reduce waste;
reinvest where investment counts;
measure and manage outcomes partially through electronic health records; and
establish a solid health care workforce foundation

If ACOs are to dominate the health care arena, we should probably know how to define an ACO.

Social Media and Employee Speech

2011-02-12T12:59:00.000-08:00

The National Labor Relations Board (NLRB) forced a settlement on American Medical Response of Connecticut Inc. after AMR fired an employee (and Teamsters member) who went home from work and profanely blasted her supervisor as being mentally ill on Facebook. Other employees posted responses supporting the employee.

The law protects the free discussion of working terms and conditions, and concerted activity, even in a crude and lewd manner in a public Internet space.

AMR agreed to loosen its Internet policies and a confidential settlement was reached with the former employee.

Since the employee posted from her home computer the issue of social media use on the job was not addressed, but it is another thorny problem.

In reviewing multiple news reports, various attorneys weighed in on the impacts of this ruling . It is likely we will need more cases to get a better definition of the boundaries, and there is no indication the ruling contradicts various laws protecting patient and customer privacy, intellectual property or prohibiting the dissemination of insider information. No indication how this might mesh with slander and defamation laws.

The NLRB announced the results of its settlement - on its Facebook page - of course.

To Integrate or Not to Integrate

2011-02-12T12:57:00.001-08:00

The Obama administrative, and especially the Department of Health and Human Services, is pushing the notion of accountable care organizations (ACOs) and similar innovative integration strategies to improve the cost-benefit ratio of health care services. This is integral to PPACA ("Obamacare.")

ACOs and other integrated provider networks are to provide 1) better coordination of care and 2) lower cost, perhaps through a bundled payment system. The exact form of these organizations is still evolving.

http://en.wikipedia.org/wiki/Accountable_care_organization

The Federal Trade Commission appears to be preparing to hammer physicians and hospitals under the assumption ACOs and the like are anti-competitive. This is consistent with pre-PPACA enforcement policies. Reports and lawyer gossip say there is a tug-of-war between the two agencies, with the Justice Department being more sympathetic to the integration.

To be fair, the FTC is supposed to enforce the laws on the books, perhaps we need some clarification from Congress?

A little clarity would speed the integration and further the intent of PPACA, IMHO.

Structuring Accountable Care Organizations (ACOs)

2011-01-29T17:07:00.000-08:00

The success of PPACA (Obamacare) cost control depends heavily on innovative delivery systems such as ACOs.

With the health care industry there is lot of chatter and lots of thinking about how these innovations can be achieved.

One problem though. Over the past couple of decades the federal government (Congress, FTC, Justice) have been concerned about anti-competitive actions. The Stark legislation (I, II, III) and antikickback statutes add to the mix (being a health care transaction lawyer has been and will be very lucrative).

There is much concern about innovating organizations into trouble, and the possible considerable costs if all parties in a transactions have to buy legal assurance each step of the way.

Suggested solutions include "safe harbor" rules (a big help with Stark) or perhaps an omnibus pre-screening mechanism.

Innovation can be very complicated.

Future reading: Modern Healthcare and other health care sources

Health Care House of Horrors

2011-01-29T17:03:00.000-08:00

This is almost too difficult to read.

(c) Philadelphia Inquirer

Additional details can be found via Google.

1/11

PPACA Phase-ins

2011-01-29T17:00:00.000-08:00

Numerous PPACA changes became effective for insurance plan years starting after 9/23/10 (for most patients this would be a plan year beginning January 1). Many changes are related to insurance coverage, including:

coverage extends to dependents up to age 26

certain preventive and immunization services will be covered with no patient cost sharing

lifetime dollar limits will be removed from benefit plans

pre-existing condition exclusions and waiting periods are eliminated for patients under 19 (older patients phase in later)

retroactive cancellation will be only in cases of fraud or failure to pay

Other changes:

increases in penalties for misusing health savings account funds

changes in flexible savings accounts (FSAs)

Much of this will increase insurance premiums in the short run, and employers are passing much of the cost down the ladders to employees.

C.L.A.S.S. commentary

2011-01-29T16:53:00.000-08:00

The C.L.A.S.S. long-term care financing program in the PPACA has been under the radar, but eventually we will need to look at the phase-in and the potential benefits.

Commentary

1/11

Happy New Year and buckle your seat belt

2011-01-07T18:18:00.001-08:00

This may be the most interesting year for health care in a long long time.

And take that!!

2010-11-09T14:04:00.001-08:00

The National Labor Relations Board is suing an ambulance company for firing a worker. The company fired the worker after she posted derogatory comments about her supervisor on FACEBOOK (TM), from her home computer.

The company says the employee was fired for multiple reasons.

The NLRB says the company violated the employee's rights, and that further derogatory comments from her and other employees were "concerted activity" protected by federal labor laws.

The new and marvelous age of technology.

SGR Cuts for Physicians

2010-11-02T11:47:00.000-07:00

Unless Congress intervenes, cuts in December and January will lower the average Medicare physician reimbursement by about 30%. Primary care physicians will see a small increase.

Dropping Medicare rates down toward Medicaid rates will do severe damage to some practices. Given the fixed/variable cost structure of physician practices, short term the only practical cuts are in staffing (and that is tough) and physician incomes. Are some physicians gaming the system? Sure.

Conspiracy theorists believe the administration wants to destroy most private practices and drive docs into hospital employment relationships. This could have some benefits, but could also do severe damage to quantity and quality of care, not to mention many hospitals do a lousy job of managing physician practices. This sort of integration can be done fast or right, but not fast and right.

Yes, we need health care reform. Fast and stupid is not the reform we need.

Added to the Document Archive

2010-10-23T18:59:00.000-07:00

Records retention grid - and more to be added very soon.

Any requests? If we have a policy, procedure or checklist we will add it - or write it.

healthcarethinktank@gmail.com

Document Archive

2010-10-15T12:04:00.000-07:00

Seminar handouts, consulting checklists, white papers and much more will be gradually accumulated in our new Internet publishing site at www.issuu.com.

healthcarethinktank document archive

Compliance: "Leave the gun, take the cannolis" (1)

2010-10-14T20:26:00.000-07:00

The changing face of health care fraud is becoming more evident, especially fraud committed by non-providers - such as non-existent durable medical equipment shops.

These groups often combine computer hacking, identity theft and bill-and-run phony front offices.

Now a little bit of a new twist.

Today (October 13th) the federal government arrest 73 people charged with racketeering for creating more than 100 phony clinics in more than a dozen states and billing Medicare and Medicaid something like $163 million. The crooks, allegedly with an Armenian "godfather" in charge, stole the identities of both doctors and patients before blitzing the feds with phony billings from non-existent clinics. The "godfather" is in lockup today.

Meanwhile the feds are auditing legitimate providers with contract auditors and cranking up requirements for compliance work. Maybe the feds should pay more attention to internal controls before paying crooks?

(reported via several major wire services)

(1) from The Godfather (part 1)

The (Premium) Stuff is Hitting the Fan

2010-10-14T19:48:00.000-07:00

Many companies are on calendar year contracts for health insurance. New quotes are often delivered in October, decisions to keep or switch policies are made, and an open enrollment period (sign ups for new coverage and changed coverage) takes place in November so paperwork can be in place by January 1.

It is no secret premiums are going up, and some are going to way, way up. This will likely induce recession-battered employers to pass more costs on to employees, effectively a cut in net pay for employees. The memos will be passed through organizations in the next few weeks, and employers will have meetings with grumpy employees.

PPACA (Obamacare) requires more lives covered in the group and more services (especially preventative) covered by the plan. This plus the usual issues of utilization and cost are driving up premiums.

This was all very predictable.

Some day these changes may start to bend the cost curve, but probably not soon enough for President Obama.

Do not stand in front of the fan.

Comparative Effectiveness Research, Gender and Emotion

2010-09-30T08:32:00.000-07:00

A key cost bending feature of PPACA (Obamacare) is comparative effectiveness research (see http://www.hhs.gov/recovery/programs/cer/index.html).

This research is designed to apply statistical, economic and clinical analysis to care and treatment to encourage effective care and block ineffective treatments.

It is highly likely, based on current research, the statisticians will recommend less screening and much less treatment for prostate cancer. As one doc said, "almost all old men die with prostate cancer, almost none of them die from prostate cancer." Screening will likely be focused on younger men and more aggressive forms of the cancer.

With men being somewhat nonchalant about such matters, and prostate cancer being something less than a celebrity telethon issue, it is unlikely there will much of a fuss. Money can be saved and the resulting increased mortality will be slight.

At the same time, current recommendations about breast cancer are suggesting a lot less mammography, and there is an uproar.

Breast cancer hits many women, hits many younger women, and the results are horrifying. The blowback from advocacy groups has been and will be fierce.

So can we get past gender and emotion to become more efficient and effective? Whatever sounds good in the abstract, many of us will go with emotion.

Obama Administration Gets "Tough" With Insurers

2010-09-14T11:26:00.000-07:00

DHHS Secretary Sebelius has lambasted the private health insurance industry in a letter to the industry's trade association (I'm not a big friend of health insurance companies, FWIW). From the letter:

"There will be zero tolerance for this type of misinformation and unjustified rate increases."

The issue is premium increases and the cause of the premium increases. Most of us are not in love with insurers, but we should stay connected to reality.

PPACA (Obamacare) requires more lives on some policies and more coverage broadly, so no wonder premiums will be going up in the short and near term (some of us predicted this).

There is little likelihood of bending the cost curve for at least five years, as the various and numerous programs in Obamacare phase it and ramp up. And then, who knows.

Understanding that politicians must be nature take care of politics, this seems a little shrill and over the top.

The official version.

http://www.hhs.gov/news/press/2010pres/09/20100909a.html

Nursing Shortage

2010-09-03T18:21:00.000-07:00

As Labor Day approaches it is a good time to think about health care labor issues, some good news, some bad news.

A phenomena many of us have noticed over the years (hard to exactly quantify though) is that recessions pull nurses back into the labor market. Nurses (about 94% female) often have husband or significant others who lose jobs or hours.

Also, some of the staffing pressure is off at the hospital level because elective procedures are down and that takes pressure off the nursing staffing.

Recessions are not the desired means of correcting the shortage though.

The discussions of shortages go back at 20+ years, and amazingly little progress has been made during that time.

There are some new and expanded programs, but a big problem now is the lack of nursing faculty. Unlike many PhD qualified professors, nursing professors are in big demand for management positions, usually in hospitals and health systems. So we are cannibalizing our own nursing pipeline.

University nursing programs are labor intensive, resource intensive and not nearly as prestigious as producing more MBAs, lawyers and economists.

While universities will get into bidding wars over top flight business, science or law professors, the willingness to play in the nursing salary market seems muted (perhaps if nursing was 94% male???).

The shortage will persist; the average age of RNs is climbing, the boomer nurses are heading for the exit while the boomer patients are becoming seniors, clinical skill requirements are accelerating, tighter reimbursements leave providers with less flexible budgets, and at times up to half of all licensed nurses are not working in direct care nursing - - all which seems to be a perfect storm.

We can send a man to the moon, but we can't figure out how to solve this problem in a country where lots of people need new careers (and yes, lots of people are not suited for nursing). Maybe when we have to shut a lot of hospitals?

HIPAA Horrors

2010-08-14T12:54:00.000-07:00

This has been a week for HIPAA horrors.

A reporter dropping some trash at a landfill in Massachusetts stumbled on a huge pile of medical records. It seems a former billing company for pathologists who served four hospitals had dumped the records without bothering to shred them. Now the hospitals and pathologists are on the hook – ouch.

Then a psychiatrist on the west coast left his laptop on the back seat of his car, and to his surprise (?) it was stolen, and the laptop contained demographic and billing information on thousands of patients.

Violating HIPAA at the Speed of Light

2010-08-06T19:02:00.000-07:00

Rarely does a week go by without a story of how "social media"** have caused problems for an employer, often because of posting confidential information, photos or just nasty comments about some phase of the business operation or co-workers.

In health facilities the stakes are much higher.

Now is the time to develop policies and educate the staff, BEFORE something bad happens.

** Facebook, MySpace, Twitter, and of course email is also a problem.

IDS - Wave of the Future?

2010-08-02T15:46:00.000-07:00

Among those who ponder the technical aspects of health care reform, there is strong sentiment for more use of Integrated Delivery Systems (IDS) in delivering health care.

This is hardly a new concept, being decades old, and it may well be the concept of the future.

The first big IDS wave occurred in the early to mid-90s, as physicians and hospitals tried various medical service organization (MSO) models; essentially the hospital owned the physician practices. Many of these deals were disasters, some worked, some evolved into something that worked.

The idea is that if a central entity (an insurer, a hospital, or a hospital network) owns and coordinates services there will better care coordination and cost savings.

The successful integrations so far have largely focused on family practice, internal medicine and ob-gyn (the OBs assistance with malpractice premiums and 24/7 coverage issues).

An interesting change is surfacing, the acceptance of specialists and surgeons into IDS models. Historically there has been a great deal of friction between these docs and the hospitals.

Why the change? Fear of dire economic consequences of staying in a traditional group practice model. Preliminary numbers from the 6/30/2010 residency class is that for the first time, a majority may opt for IDS employment rather than group practice. There are also reports that young docs are more concerned with life balance issues than previous generations.

So, any problems?

Hospitals are notoriously bad at managing physician practices, physician contracts must be structured carefully, physician productivity sometimes drops off with a steady paycheck, and the process of merging practices and/or converting ownership is a great deal of complex work at no small cost. Also, making this work in rural areas is tough.

Biggest question, will IDS on a large scale really cut costs? Or just reshuffle the deck chairs?

Yes - No - Yes - No - Maybe - Sorta - Someday

2010-06-20T13:38:00.000-07:00

Medicare Fee Ordeal - Continued

As of Friday the Senate has passed a six (6) month patch to counter the Sustained Growth Rate formula cuts to physician fees.

The House will consider the patch next week, and is likely to pass the necessary legislation.

CMS contractors will process claims from June 1 forward - someday.

Stay tuned.

FTC Red Flags Delayed Again

2010-06-02T09:33:00.000-07:00

The Federal Trade Commission has delayed the "red flag" identity theft rules for (most) health care providers. The rules originated in the Fair and Accurate Credit Transactions (FACT) Act of 2003.

The act defines most medical providers as creditors.

The new effective date is January 1, 2011.

Stay tuned.

3/21/2010 10:48 pm - A New Era Begins

2010-03-21T20:13:00.000-07:00

An editorial:

The passage of the health care reform bill is a major milestone for U.S. health care services.
With passage, we will need to unravel the bill and the real story and prepare for the intended and unintended consequences of this massive effort.

The legislation is neither as bad as the Republicans make it out to be, not as fabulous as the Democrats claim. The bill changes the health care system to an amazing depth and breadth, and despite the proclamation of economists, politicians and policy wonks, we do not really know the full impact of the bill.

Reform is needed, we will soon be hitting the point at which employers have trouble providing health insurance to employees at an affordable price, the alternatives being dropping coverage or taking more from employees pockets.

President Obama will be hammered by the political right for going too far too fast, and by the progressive left of his own party for being timid. The left wanted a single payer system, was willing to settle for a public option, but left the table with only hope reform will be revisited, as it will.

The amount of misinformation, overgeneralization and plain old hot air tossed around during the debate make a calm analysis difficult, and will leave citizens and patients confused and alarmed, probably more than required. The bill is full of slow phase-ins and long transitions as we attempt to turn around one-sixth of our economy and attempt to attain several seemingly contradictory goals.

A great deal of the debate has focused on the budget impacts, and specifically the positive or negative impact on the deficit over a ten year span. The bill is full of wiggles and gimmicks, and as the vote drew near the Congressional Budget Office (CBO) estimated a positive deficit impact of about $140 billion in ten years.

Truth be told no one has any real idea what the bill will do to the deficit over ten years. Anyone who has studied the history of Medicare and Medicaid knows the legislative budget estimates tend to melt in the face of annual politicking and lobbying.

There are problems needing immediate attention. State budgets, hammered by the recession will have to be cut Medicaid benefits, a backwards step. Medicare physician reimbursement formulas, problematic for a decade, are being patched again while Congress dances around a permanent solution. Private insurers and employers will have to adjust quickly to new regulations and cost structures. Changes in Medicare are inevitable.

We can improve coverage and contain cost, but the reforms have to be constructed so carefully it is unlikely any political process has or will do so.

Now we know when the journey begins and the direction it is going. The details will be tough to work out, and there are many battles ahead, but decision making improves as certainty increases. We may get a good place, but not without many bumps and bruises.

Game On! Again

2010-02-23T11:26:00.000-08:00

This week President Obama introduced (finally) the Obama health care plan.

The plan, close to the Senate version but with concessions to the House version, will be pushed hard by the administration and Democratic leaders in the Congress.

The plan is long, complicated, has many moving parts and is liekly to change significantly.

More details to follow as we parse the plan and Congress begins to move.

While Rome Burns Nero Fiddles - Health Care Edition

2010-02-02T09:12:00.001-08:00

While the House and Senate were trying to overhaul the entire health care system, key Medicare regulations were left in limbo. Those provisions are still in limbo.

Medicare physician reimbursement based on Sustainable Group Resources (SGRs) have been controversial and generally considered unworkable since being passed. The solution has been an annual fix rather than a permanent fix. The House bill had a permanent fix, but went nowhere.

As a result of not being fixed, some physicians will see draconian cuts in Medicare reimbursements as of March

Primary care docs will see a small increase in rates. Or there may be a fix, or maybe not.

Physical therapists who provide Medicare services are now subject to a cap, amounting to rationing, for elderly patients. This capping system was instituted in 1997 but an annual fix has prevented implementation. Now that too is in limbo, and therapists may be “donating” services in 2010, while waiting on an answer. If the cap remains, services will have to be rationed..

Seniors are very dependent on various forms of therapy to regain mobility and self-sufficiency after fractures, surgeries and strokes. Would we prefer nursing home placement instead?

If health care reform enlarges the role of the federal government, and this is how the feds do business, this could prove interesting.

Game On!

2010-01-03T14:46:00.000-08:00

This month will be a major month in the history of U.S. health care, whatever happens.

The House and Senate will attempt to reconcile their bills, with the future of reform in the balance.

Stay tuned!

Reform Moves Forward

2009-12-19T18:47:00.000-08:00

After some intense political horse trading a reform bill has moved forward in the Senate, with further voting possible before Christmas. Nebraska will be better off, should this pass.

Assuming the Senate passes a bill, the next procedure would be for the House and Senate to attempt to reconcile the bills. This is far from over.

Washington Marches On

2009-12-15T11:29:00.001-08:00

The effort to shape a health care reform bill (that can pass) in the Senate continues.

Stay tuned. This process is ugly, but may be some will happen.

CER Hits a Snag

2009-11-23T13:10:00.000-08:00

Comparative Effectiveness Research (CER) may have inadvertently lost credibility even before health care reform is actually launched.

CER is the darling of the government-dominated health reform movement (not a government take-over, to be clear). The use of evidence-based medicine when combined with cost-benefit analysis has the potential to save a great deal of money while better serving the patients. Many see downsides though; too rigid protocols and interference with physician judgment, or the dirty "R" word, rationing.

The U.S. Preventive Services Task Force recently released a study on various breast cancer screening modalities, recommending more limited screening protocols, particularly delaying routine mammography until age 50 (except in women with unusual risk factors).

Kah – boom!

USPSTF points out film mammography does cut mortality, with the greatest reductions in women over 50, with the best results in the age 60 – 69 cohort. Film mammography does carry a risk of false positives and the pain and inconvenience of unnecessary biopsies.

USPSTF also recommends ceasing mammography on women over 74, citing a lack of reliable evidence of reduced mortality.

There was a huge backlash from women, physicians, cancer activists and some health care associations.

USPSTF also recommends against teaching women to perform ”breast self-exam” (BSE) which has been a standard tool for decades. More backlash.

USPSTF does point out that digital and MRI mammography do not show, at this time, significant improvement over film mammography, but do have greater costs.

None of the conclusion appear to have been made on strong and startling statistics, but on think pros and cons, as one might expect from quants and scientists.

Women apparently want a little less quant and a lot more consideration.

USPSTF report:

http://www.annals.org/content/151/10/716.full

Game On!

2009-11-19T19:15:00.000-08:00

The 1920 page House bill was passed and the 2020 page Senate bill is now subject to active debate.

Keeping up with the details is impossible, but we monitor the key points as best we can.

Game on!

HIPAA Security Alert

2009-10-29T07:39:00.000-07:00

HIPAA Horrors

The Blade (Toledo) reports on October 28th an imaging technician was arrested in Ohio for driving infractions and possession of marijuana.

During the arrest the police scanned his cell phone.

In his phone were photos of dozens of partially clad patients preparing for imaging tests, including minors.

Wow.

The penalties and lawsuits are likely to be massive.

HIPAA Security Alert

2009-10-01T06:02:00.000-07:00

Do you trade-in or donate used cell phones?

Before you do, you MUST scrub all of the data from the phone.

Game On!

2009-09-29T11:54:00.000-07:00

The Senate Finance Committee is holding hearings today, likely focused on the "public option," with serious disagreement even among Democrats.

Senator Baucus has been in the lead in the Senate, but his opposition to the public plan (he thinks the plan, whatever the merits, would kill the bill) has irritated some senior members of his own party.

Stay tuned.

Reform Round 2

2009-09-10T10:24:00.000-07:00

President Obama's speech yesterday was "hitting the reset button" for health care reform.

First impressions - the numbers do not add up.

And every President since Nixon has promised to reduce "waste, fraud and abuse" from Medicare and Medicaid.

Game on!

HIPAA Security Social Nightmares

2009-08-26T07:36:00.000-07:00

Facebook ™, Myspace ™, Twitter ™ and millions of web logs (“blogs”) are connecting people worldwide, and that includes your employees.

Some business organizations are using these social networks, some not, but either way it is a good bet your employees are using these sites to connect with and expand their social networks.

That can be a huge problem!

Employees used to flashing every aspect of their lives on-line are very likely to discuss work on-line as well.

Social networks sites create a huge risk for HIPAA violations, and also for employee problems (some of the comments posted can be incredibly vicious),

HIPAA is 24/7!

No, you cannot control your employees lives, EXCEPT as it relates to work.

Every health care organization should develop policies and procedures on the use of social networking sites for the broadcast of work related information. Soon.

The Doomsday Scenario

2009-08-12T12:33:00.001-07:00

So why are conservatives so excited about health care reform?

Many see the progressive left pushing a gradual move to the Doomsday Scenario, something like this:

1) private health insurance is hyper-regulated, underwriting standards are eliminated, and premium costs rise astronomically

2) employers, especially smaller employers, drop coverage and push employees to the “public plan”

3) the resulting dislocation of coverage and expansion of the public plan becomes a rationale for single payer – “see, we told you so.”

Having read thousands of pages of reform material over the past 18 months, and having studied the various reform movements since the early 90s, I think the Doomsday Scenario is quite feasible, and certainly I wouldn’t put it past the progressive left.

In public President Obama emphatically denies any such scenario. However, if the Scenario were to evolve, would he revert to his earlier ideas on single payer?

My request is for an honest debate. If Obama really wants to move to single payer, he should say so, and let the real debate begin.

For now, expect fireworks (not excusing rude behavior by the way).

Models for Reform?

2009-07-23T08:18:00.000-07:00

President Obama often cites the Mayo Clinic and the Cleveland Clinic as models for providers in a new era of health care reform.

Question: Can these two models be replicated throughout the country?

Answer: Not likely. Certainly not in the near term.

The Mayo Clinic is unique but has replicated itself a few times, and the Cleveland Clinic is unique and to the best of our knowledge has not been replicated.

Even if these models could be replicated, it is unlikely they could be replicated in any but some urban areas. And if they could, the transition cost in most markets would be immense, and who would pay for that? (the new Mayo Clinics are in high growth and very prosperous areas, Florida and Arizona)

Can we learn anything from these clinics. Possibly yes. Can we duplicate these models in other areas? Not likely, and certainly not in the near term.

The Status of Reform

2009-07-22T08:11:00.001-07:00

As of today, there are as many as five (5) plans active in Congress, President Obama is getting impatient, Congressional leaders are counseling patience, and no one knows if any action will be taken before the August Congressional recess.

Stay tuned.

Battle of the (Senate) Titans

2009-07-04T09:16:00.000-07:00

Senators Kennedy (Chairman of the Senate Health, Education, Labor and Pensions Committee) and Senator Dodd (Kennedy’s wingman while he fights cancer) are seemingly lined up as opposition forces to Senator Baucus (Chairman, Senate Finance Committee ) on some aspects of health care reform legislation. Various theories are evolving:

1) this is a real dispute
2) this is a clever ruse to allow a compromise that gives political cover to all types of Democrats
3) this is just some foreplay designed to allow Kennedy to be a hero one more time, with serious cred to Baucus, a rising power in the Senate
4) some combination of #1 - #3

Kennedy and Dodd’s latest: http://dodd.senate.gov/?q=node/5062/print

Medicare Bundling

2009-06-15T13:17:00.000-07:00

The federal government is concerned about the incidence of Medicare re-admissions.

Typical scenario: an elderly patient is admitted to the hospital for pneumonia and related distress. After a four day stay the patient is discharged to a long-term care facility.

A week later the patient is re-admitted with acute distress, after the nurse requests orders from the patient’s physician. After several days the patient is again discharged to the nursing home.

This cycle is very costly to Medicare, and the feds would like to see it slow down.

(Based on conversations with long-term care nurses and reviews of Minimum Data Set (MDS) summaries, the patients are usually very old, very frail, but not at death’s door quite yet.)

One solution is to ‘train” physicians and families not to be so quick to send the patient back to the hospital. This is tough on families, who often pressure the physician to readmit. Sometimes the patient demands readmission, it is easy for the physician to say yes. This can also be tough on the nursing home, where higher acuities are colliding with the nursing shortage.

A proposed solution is bundling. President Obama mentioned it in his 6/15 speech to the AMA. How does it work? The hospital gets a flat fee per incidence and then has to pay the physician, nursing home, ambulance/transport company, physical therapist, etc.

This requires a lot of administrative work and some intense negotiations, and puts the hospital at significant risk.

Could this work? Maybe. Is it good for Medicare? Probably yes. Good for patients? Unknown. Good for physicians? It depends. Good for the nursing home? Doubtful.

Fast and Furious

2009-06-08T12:48:00.000-07:00

No, not the movie - health care reform.

In recent days:

President Obama, in his Saturday radio address, promised to get hands on the issue.

Senator Kennedy let draft reform legislation float around, creating the appearance that he is stepping in front of Senator Baucus.

Senator Kennedy and Senator Baucus issue a statement about how well they are going to work together.

The possible tax on health care benefits bubbles to the surface once again, as do possible taxes on sodas, beer, wine, and other sinful pleasures; other possibilities include taxes on securities dealers, life insurers and elimination of certain estate planning practices.

President Obama lets it be known he wants to tax the rich, not working people, possibly via deduction caps (Axelrod and Goolsbee floated this trial baloon on the Sunday talking head shows).

The House is circulating a proposal with an almost mandatory coverage rule, and penalties for anyone with the means who refuses to buy health insurance (?). All non-group policies would be channeled through a federal policy exchange. A spokesmen for Rep. Waxman made clear the circulating drafts are not the official work product of any committee.

More on this as the trial baloons become more official.

Selling Health Care Reform

2009-06-02T11:40:00.000-07:00

President Obama is selling health care reform with the argument that we need to fix health care in order to fix the overall economy.

Economic advisor Christina Romer distributed an op-ed piece today explaining how health care reform would 1) improve family incomes, 2) enhanced GDP, 3) lower budget deficits, 4) lower unemployment, 5) provide greater health care coverage (of course) and a 6) better labor market.

Wow. This is quite a claim.

Full report: http://www.whitehouse.gov/assets/documents/CEA_Health_Care_report.pdf

Paying for Health Care Reform

2009-05-28T14:30:00.000-07:00

President Obama’s ambitious health care reform plans may have run into an immovable object – money.

In order to move forward on his plan the President has to find and/or reallocate something on the order of a trillion dollars or so.

One means of expanding health care coverage while containing health care costs is “efficiency” a fuzzy and hard to predict concept at best, especially while expanding insurance coverage.

Other potential means are been discussed by various constituencies, in no particular order:

Taxing the rich (also discussed to solve the deficit and other problems)

Tax some or all employer-paid health care benefits

Tax soda

Tax all sorts of “sin” products

Broaden the Medicare tax base

Cut payer reimbursements, possibly offset by insuring most Americans

Create new reimbursement systems for providers, perhaps “outcomes based”

Reduce or eliminate the tax sheltering benefits of Flex Savings Arrangements (FSAs)

Alter Health Savings Accounts (HSAs)

A national value added tax (VAT) or sales tax

Accomplishing this in the midst of a nasty and deep national recession may prove to be difficult if not impossible, but it appears Congress is going to move ahead and give it a try in the next few months.

Now or Never

2009-05-28T13:43:00.000-07:00

as reported today by the Associated Press

President Obama, on a conference call from Air Force 1 with a coalition of supporters, warned that if health care reform is not accomplished this year it may never be.

(Ed: Never is a long time .......)

Obama is trying to enlist his political organization, Organzing for America, active and engaged in the political process.

Obama is leaving the details of health care reform to Congress, apparently having learned something from the 1993 mistakes of the Clinton administration, which did an end run on Congress.

Rationing or Evidence-Based?

2009-05-13T10:47:00.001-07:00

Medicare has decided not to pay for virtual CT colonoscopies.

Medicare does cover regular invasive colonoscopies.

The x-ray procedure is a substitute for invasive colonoscopies. It is cheaper and non-invasive, but does involve x-ray radiation.

The invasive colonoscopy allows the surgeons to excise any pre-cancerous polyps found, saving a second procedure.

If the CT colonoscopy finds pre-cancerous growths, then a regular colo must be done to excise the polyps, thus causing two procedures instead of one.

Medicare does point out that the Medicare population, almost all of whom are 65 and over, may not be a good indicator for the under-65 population. Medicare is willing to look at future data.

These are the sorts of dilemmas health insurers must wrestle with. No decision will make everyone happy.

Rationing or evidenced-based medicine? Depends on your point of view.

Tax Discussion Update

2009-05-12T18:28:00.000-07:00

May 12, 2009 - from the AP

Senators weigh tax hikes to pay for health care

By RICARDO ALONSO-ZALDIVAR, Associated Press Writer Ricardo Alonso-zaldivar, Associated Press Writer 1 hr 12 mins ago

WASHINGTON – Senators are considering limiting — but not eliminating — the tax-free status of employer-provided health benefits to help pay for President Barack Obama's plan to provide coverage to 50 million uninsured Americans.

Finance Committee Chairman Max Baucus, D-Mont., said Tuesday that there are no easy options. Senators began grappling with how to finance guaranteed coverage, a cornerstone of Obama's plan to overhaul the health care system. Independent experts put the costs at about $1.5 trillion over 10 years......

The Great Tax Debate

2009-05-09T19:53:00.000-07:00

Employer-paid health insurance is usually a non-taxable benefit to the employee. IRC S106.

Over the years this “loophole” has popped up in various discussions of tax fairness and expanding health care coverage.

The Obama administration has floated various trial balloons, and Senator Baucus (D. Montana), an influential player in the health care reform debate, thinks the time for change may have come.

Rep. Charles Rangel (D. New York) a veteran representative and powerful chairman of the House Ways and Means Committee says simply, “no way.” All tax legislation originates in Ways and Means.

Candidate Obama criticized John McCain for proposing the taxation of health insurance benefits, but advisors to President Obama will not close the door, including new DHHS secretary Sebelius.

President Obama needs a major funding source to help close the deficit and to provide a $600M plus health care reserve fund.

Some labor unions fiercely defend the tax break, as middle class union members would be hit hard by a tax on health insurance benefits.

(Using real tax family returns and creating pro formas by adding policy amounts, the tax increase could range from about $1500 - $5000, depending on the structure of the tax, the possible applicability of FICA and Medicare taxes, and the taxation policies of state and local governments.)

In theory, employers would save some money because enhanced government programs would slow or eliminate “cost shifting” from the uninsured to the insured. However, employers might end up paying higher matching FICA taxes. Employees would be unlikely to see any of the savings (if any).

This could be a nasty debate, with some strange bedfellows.

Electronic Medical Records Held for Ransom

2009-05-07T18:51:00.000-07:00

A drama is playing out in Virginia as computer hackers claim to have hacked a data base used to monitor patients for prescription drug abuse.

The hackers are demanding a $10 million ransom for the data, or the data goes on the internet.

Virginia health officials and the FBI believe the threat may be credible.

The future of EMR?

Swine Flu

2009-04-26T14:20:00.000-07:00

The United States government declared a public health emergency Sunday as the number of identified cases of swine flu in the nation rose to 20.

From Reuters:

"WASHINGTON, April 25 - A new and unusual strain of swine flu is likely widespread and impossible to contain at this point, experts agree.

The H1N1 strain has killed at least 20 people and possibly 48 more in Mexico and has been confirmed in at least eight people in the United States, all of whom had mild illness.
Probable cases also were found at a school in the New York City borough of Queens and experts at the U.S. Centers for Disease Control and Prevention say they fully expect to find more cases."

This strain of influenza spreads easily from person to person, has been diagnosed in several places and some victims have had no known contact with carriers. Not pretty.

Military - VA Medical Records Plan

2009-04-09T13:34:00.000-07:00

President Obama wants to create a Joint Virtual Lifetime Electronic Record that would streamline the transfer of active-duty military and veterans' health records between the two departments.

Given the targeted patient demographic this might be an interesting test of electronic medical records capability.

OSHA Workplace Violence Procedures

2009-04-07T11:04:00.000-07:00

The tragic shooting spree at a Carthage North Carolina nursing home is a reminder of the OSHA requirement for a workplace violence program, applicable for not only nursing homes but other health care providers as well.

No program can stop a crazy killer or an armed robber, but training employees to react properly can hasten the arrival of police and the protection of residents.

This should also be a reminder that facilities open 24/7 have special issues with security and safety.

OSHA fact sheet:

http://www.osha.gov/OshDoc/data_General_Facts/factsheet-workplace-violence.pdf

Veterans Care Fiasco - Disaster #2

2009-03-25T13:06:00.000-07:00

More than 3000 southern Florida veterans are being called in for infectious disease testing after tubing on colonoscopy equipment was found to be improperly sterilized.

This follows a similar colonoscopy problem in another region, and another recent problem with ear-nose-throat equipment.

The care standards for these procedures are quite well known, and the number of exposures indicates a serious management problem (as opposed to a batch or two of sterilization problems, which can happen).

Odds of infection should be low, but low is too high for those infected.

VA Policy Proposal - Disaster #1

2009-03-25T13:02:00.000-07:00

Last week the Obama administration floated a lead-filled trial balloon.

The administration proposed that a veteran's care could be billed to a vet's private insurer in some cases, raising $500M a year.

The feedback from veterans' groups and Congress was swift and ugly.

Veterans' feared losing private insurance coverage, and members of Congress proclaimed veterans' care a convenant not to be broken.

The administration moved on to other topics - quickly.

The Lastest in Physician Office IT

2009-03-11T11:36:00.000-07:00

Who will lead the charge to install IT in physician offices?

Sam's Club and Dell.

Huh?

Sam's Club will partner with Dell and eClinicWorks for software, hardware, training and maintenance. No joke.

The system will integrate patient appointments and billing (the billing modules are ultra-complex and carry significant risk of major problems).

Wal-Mart has some experience with health care IT, primarily in pharmacy and optometry. WM also has used the software in a limited number of redi-clinic settings (which are much different than a regular physician office).

Does Wal-Mart understand the complexities of physician office operation and the vagaries of dealing with physicians?

The $20B stimulus money had to attract a lot of vendors, this may be the surprise leader of the pack.

Tires, lettuce, underwear, health IT. Such a concept.

Hat tip: International Herald Tribune 3/11/2009

More Blogging

2009-03-11T06:53:00.001-07:00

It has become clear, this blog will be dominated by health care reform and public policy.

The management issues we want to discuss simply cannot be woven in here.

So...................

A new blog, http://practicemanagementnews.blogspot.com/ will focus on management issues and regulatory matters. There will be some cross posting.

Spread the word!

Rediscovering the Nursing Shortage

2009-03-08T08:34:00.000-07:00

Another administration discovers the nursing shortage.

http://www.reuters.com/article/domesticNews/idUSTRE5270VC20090308

http://news.yahoo.com/s/nm/20090308/hl_nm/us_usa_nurses

Proposal: the federal government should channel funds to colleges and universities that provide programs we need, rather than graduating more Ph.D.s in overcrowded disciplines.

Nursing - high stress, bad hours, physical exertion, exacting standards, little respect.

Failure to warn

2009-03-05T08:11:00.001-08:00

The U.S. Supreme Court settled a major liability issue in Wyeth v. Levine this week.

A patient was given an IV push dose of Phenergan, apparently the administration was done in a negligent manner and the medicine entered an artery, and the patient lost her arm.

As best I can tell there was no allegation that Phenergan, a widely used drug, was hazardous, but that the drug maker Wyeth should have provided better warnings about what could happen if an IV push administration was done improperly.

(I checked with my favorite nurse, who tells me that she doesn't need to be warned not to put an IV into an artery, as she said "what do you think the "V" stands for." Nurses rarely read warning materials on commonly used drugs anyway. Just one opinion. She does administer Phenergan regularly, although not via IV.)

The legal argument?

Wyeth claimed that since the FDA had found Phenergan to be safe and effective, and because the FDA has approved very precise language on the label, there was no duty to provide further warnings and no ability to unilaterally rewrite the warning materials.

SCOTUS says the state could find a duty and that Wyeth could have unilaterally changed the labeling.

So what does label approval by the FDA mean today? How far does the unilateral rewrite authority go? What if the FDA disagrees with the unilateral rewrite.

From a liability standpoint, how much liability should a drug or device maker have for provider malpractice?

Interesting questions.

Voodoo Finance

2009-03-01T17:41:00.000-08:00

Governor Strickland of Ohio is going to increase his Medicaid available funds by -- taxing health care providers, specifically hospitals, nursing homes, MR facilities and managed care companies.

Huh?

Dirty little secret -- some states use "bed taxes" or "provider taxes" or "provider fees" to generate match money for federal Medicaid funds, a maneuver which is legal but on shaky ethical grounds. This is "dog chases tail" gimmick financing. Who is to blame? Fed reform of Medicaid would help.

A nursing home will pay the "tax" on all licensed days of service, but will be reimbursed for the "tax" only for those days used by Medicaid recipients. This amounts to a tax on all residents not funded by Medicaid, what the federal government calls cost shifting.

When criticized for using stunts and gimmicks to balance the budget (and avoid restructuring the government), Strickland uses the everybody else has done it defense.

To be fair, the states have many difficult budget decisions. This is not a healthy balance budgeting tool, especially after the feds pouring stimulus money into the states.

For more details, excellent reporting in the Columbus Dispatch.

http://www.dispatch.com/live/content/index.html

Secretary of DHHS

2009-02-28T17:00:00.000-08:00

Kansas Governor Kathleen Sebelius has accepted an offer to be Secretary of DHHS.

Change We Can Believe In?

2009-02-27T06:24:00.000-08:00

No one can claim President Obama is timid!

His new budget plan, or at least what we know so far, appears to make some bold moves on health care reform.

Stay tuned for detailed analysis, as details are available.

Stimulus Part IV

2009-02-22T09:21:00.000-08:00

The concept of "effectiveness review", in general, states that payers (and especially the government) should not pay for drugs and procedures not already proven effective.

(The political theory is private payers will take the lead and refuse to pay for anything not paid for by Medicare and Medicaid.)

Question: if the drugs and procedures are not paid for, and clinicians do not use them, how do we compile the evidence of effectiveness?

For drugs we do have clinical trials, but many physicians are more convinced when they see the effectiveness in clinical practice.

For surgical techniques and hardware, most progress has been made with years of trial and refinement (such as the immense progress in orthopedic joint replacement).

Will we slow innovation? How will we balance cost versus progress?

Stimulus Plan Part III

2009-02-22T08:07:00.001-08:00

While we wait for six more inches of global warming to be cleared from Michigan's highways..... (8 feet so far this year).

Who is spearheading the "effectiveness review" concept inside the Obama administration?

Peter R. Orszag.

Orszag is Director of the Office of Management Budget for the Obama administration.

By all accounts he is a brilliant economist, and an expert on retirement issues.

Best I can determine, he has little or no background in health care.

We love economists here, but wonder about health care reform being driven by economists.

Time will tell.

Update: Apparently Orszag did some HMO consulting during a stint with McKinsey and Co.,

Stimulus Bill Part II

2009-02-22T06:21:00.000-08:00

Why is the stimulus bill (H.R. 1) more than 1000 pages?

More than 200 of those pages are health care reform, including a massive health care IT plan.

How much time was spent debating the largest health care reform plan of the past two decades?

None.

Also included are updates on HIPAA security and privacy, and perhaps the provisions that will shape the future of U.S. health care, the "effectiveness review" plan. I just reread Tom Daschle's book, and his brief stint as almost-Secretary allowed him to have immense influence.

In front of me is a full 3" ring binder, perhaps containing the future of our health care system, perhaps not.

First, a few days with the grandchildren. Then, the work continues in earnest.

Update: I was curious. Printed in pieces from the Thomas site, I have 261 pages.

Stimulus Bill Part I

2009-02-14T20:39:00.000-08:00

I spent my Saturday working through the stimulus bill, which looks more like a health care bill with a stimulus package attached.

Printing the health care sections nearly burned up my printer.

Look for analysis coming almost every day.

Surprise - Congress revisited HIPAA, just to add work and confusion to the situation.

The Ghost of Tom Daschle?

2009-02-10T07:24:00.000-08:00

Recent news reports and commentaries on the stimulus bill allege the bill contains many of the bureaucratic recommendations of former DHHS nominee Senator (retired) Tom Daschle.

This is still developing.

In brief, Daschle wanted massive government data bases of patient information combined with a board to determine which treatments and medications physicians could order for government patients.

More as this develops.

Secretary of DHHS?

2009-02-07T19:38:00.000-08:00

The Associated Press is reporting today that Kansas Governor Kathleen Sebelius may be the leading candidate for the Secretary of DHHS.

Sebelius had reportedly been considered for this and other cabinet posts before Tom Daschle was slotted for DHHS. Daschle melted down in a tax controversy.

Sebelius was Insurance Commissioner before becoming Governor, a back ground that would be helpful in the job.

Sebelius has deep roots in the Democratic Party, her father was a liberal Governor of Ohio.

This appointment is not assured. Stay tuned.

Daschle Withdraws

2009-02-03T10:02:00.000-08:00

CNN is reporting that Tom Daschle, beset with tax and potential conflict problems, has asked to wtihdrawn from consideration as Secretary of Health and Human Services.

Developing, pending further confirmation.

Update: AP confirms

News Flashes

2009-02-01T05:39:00.000-08:00

Senator (retired) Tom Daschle was on a fast track for confirmation as Secretary of Health and Human Service (and to be a sort of health care reform czar) when his tax returns jumped up and bit him.

Daschle was working as a $1M a year "consultant" to a media private equity fund run by his friend, and receiving free car service, a very substantial benefit in Manhattan's gridlock.

Reports say on one return Daschle forgot an $89k consulting payment, as it was excluded from his Form 1099 (how does an accountant not multiply 89 x 12?).

The Daschle's paid the back taxes this year with interest, but are also reported beneficiaries of a special influential insider penalty waiver by the IRS (how sweet).

Time will tell.

UPDATE: The Daschles may have to re-amend their tax returns. Developing....

In other (better) news.....

Professor David Cutler of Harvard, an influential voice in health care reform discussions, has been selected to serve as a health care advisor to President Obama.

Tom Daschle's health care book - Part III

2009-01-26T08:07:00.000-08:00

Five functions of the Federal Health Board

1. set rules for the expanded Federal Employee Health Benefits Program

2. promote "high value" medical care, i.e., recommending coverage of drugs and procedures backed by solid evidence, and ranking services and therapies

(how we gather this evidence for new drugs and procedures is not exactly clear)

3. align incentives with high-quality care

4. increase transparency

5. play a role in nationalizing (his words) our health-care infrastructure (although he then proceeds to discuss resource allocation rather than infrastructure)

Solid proposal or cliche' fest? Discuss.

Pages 171-178

Tom Daschle's health care book - Part II

2009-01-26T06:57:00.000-08:00

Senator Daschle wants to build on the current private system, but also expand the scope and reach of federal government programs.

The Federal Health Board, modeled after the Federal Reserve Board, would initially be directed at the federal government programs, but Daschle makes it clear that with enough influence the FHB would assert signficiant control over the entire U.S. health care system.

"I believe a Federal Health Board should be charged with establishing the system's framework and filling in most of the details. This independent board would be insulated from political pressure [emphasis mine] and, at the same time, accountable to elected officials and the American people. This would make it capable of making the complex decisions inherent in promoting health system performance. It also would give it the flexibility to make tough changes that have eluded Congress in the past." (page 169)

"The Federal Health Board would have regional boards that would have a say in national decisions, but would focus primarily on promoting best practices and quality of care locally...... Over time, the regional boards might assume other roles, such as ensuring an adequate supply of certain services or linking payments to performance....." (page 170)

Next post, the five functions of the proposed FHB.

Tom Daschle's health care book - Part I

2009-01-24T06:36:00.000-08:00

Senator (retired) Tom Daschle, new Secretary of the Department of Health and Human Services (and health care czar!?) wrote a book in 2008 about the health care system (before he knew about this position I believe).

Given Daschle's major influence in the new administration, I am studying the book to look for insights into possible reform plans.

(Daschle has been working at a DC law firm which also does lobbying, but Daschle was apparently kept insulated from the lobbying operation.)

We open with something v-e-r-y interesting. From the dustcover....

"Daschle's solution lies in the Federal Reserve Board, which has overseen the equally complicated financial system with great success. A Fed-like board would offer a public framework within which a private health care system can operate more effectively and more efficiently - ...."

To be fair to Daschle, I believe this book was written before the current financial meltdown, but this concept is a little scary. More in the next post.

Critical: What We Can do About the Health-Care Crisis - Daschle, Greenberger, Lambrew, Thomas Dunne Books, St. Martin's Press, 2008

Billing News - Technical Pronouncements

2009-01-17T08:46:00.000-08:00

ICD-10 HIPAA transaction standards

The current set of outpatient diagnoses codes, the International Classification of Diseases, 9th edition, Clinical Modification (ICD-9-CM) will be replaced by the tenth edition (ICD-10-CM). Physician practices and others must begin submitting ICD-10-CM diagnoses codes by Oct. 1, 2013.

Administrative transactions standards

CMS released the final rule mandating the latest set of administrative transactions standards as part of the Health Insurance Portability and Accountability Act (HIPAA). The ASC X12N 5010 standards replace the current ASC X12N 4010A1 version of the electronic transactions standards. CMS has set Jan.1, 2012, as the compliance date for the 5010 standards.

Comment:

These will require an immense amount of work by provider and tech geeks to make this work.

The government's attempts to make health care billing totally incomprehensible continue apace.

(Sources include Modern Healthcare and the Medical Group Management Association.)

Daschle Confirmation Hearings

2009-01-08T07:45:00.000-08:00

The hearings for Secretary of DHHS (and health care czar) start this morning. So far it is a love fest.

I have picked up Daschle's book and will have a post on that soon.

Update:

The usual preening by Senators, followed by Daschle's assurances that he can fix any problem.

Should we return to the Certificate of Need (CON)?

2008-12-29T05:33:00.000-08:00

In the 70s and 80s many states had health care Certificate of Need (CON) laws.

In generally, the CON required state approval for the construction or major renovations of hospitals, the construction or major renovation of nursing home beds, and the addition of major technology, such as imaging centers.

The laws varied by state so the generalization did not apply exactly to each state. I believe there may be four (4) states that have retained CON laws (one being Michigan).

When I was young and naïve I believed the CON was based on the formulas built into the law. After some experience I learned that in the states I worked the CON process was rotten with politics, money and influence peddling.

Many states repealed the CON rules because the process did not work, or as a deregulation maneuver.

The market did actually work in one instance, nursing home beds are not being built despite the absence of CON laws, largely because seniors housing and assisted living centers have created a continuum of care that minimizes the need for nursing home beds.

So should we allocate health care capital via the government? What happens to the political losers? Would this slow capital spending, and is that a good thing? How do we keep rotten politics out of the process?

Nursing Home Rating System

2008-12-21T19:20:00.000-08:00

The federal Department of Health and Human Services, Center for Medicare and Medicaid Services, has instituted a "five star" nursing home rating system.

The idea is to provide useful information to families and residents, consumer advocates and government officials.

Having spent 30+ years involved with nursing homes, and having been involved in all phases of the regulatory system, I am skeptical.

To be fair, CMMS includes the weaknesses in the rating system in the narrative explaining the system.

Nursing homes are the most highly regulated sector of the health care system, and are targets for consumer advocates, bureaucrats and on-the-make politicians.

Some snowy afternoon I am going to spend a few hours looking at some homes I am familiar with, and see if the rating system has any connection to reality.

http://www.medicare.gov/NHCompare/Include/DataSection/Questions/SearchCriteriaNEW.asp?

Say it Ain't So!!!

2008-12-05T14:11:00.001-08:00

From the Wall Street Journal, December 5, 2008

Daschle Launches Push for Health-Care Overhaul (excerpt)

"Mr. Daschle, who Obama transition officials say will be nominated secretary of Health and Human Services, will suggest that Americans hold holiday-season house parties to brainstorm over how best to overhaul the U.S. health-care system. He will promise to drop by one such party himself, and to take the ideas generated to President-elect Barack Obama."

Worst idea ever?

Health Care and Stimulus

2008-12-04T12:57:00.000-08:00

I am still working my way through the Baucus white paper, and promise a summary soon.

While you wait, Jonathon Gruber has some interesting ideas about health care and economic stimulus (hat tip to Mark Thoma, and copyright the New York Times).

I do not exactly follow some of Gruber's numbers, but it is worth a read, and he clearly understands the there are issues at the state level.

Also, Gruber implies laid off workers can fill the gaps in primary care by becoming nurse practitioners, RNs and physicians assistants. Ah, maybe with five or six years of education, not exactly a short term fix.

http://www.nytimes.com/2008/12/04/opinion/04gruber.html?_r=1&adxnnl=1&partner=permalink&exprod=permalink&adxnnlx=1228424909-z/TnOs7jrts8JVNMmo69nQ

Job offer - Secretary of HHS

2008-11-19T11:51:00.000-08:00

from the Associated Press ( (c) 2008)

WASHINGTON – Former Senate Majority Leader Tom Daschle has accepted President-elect Barack Obama's offer to be Secretary of Health and Human Services, Democratic officials said Wednesday.

The appointment has not been announced, but these officials said the job is Daschle's barring an unforeseen problem as Obama's team reviews the background of the South Dakota Democrat.

One area of review will include the lobbying connections of his wife, Linda Hall Daschle, who has lobbied mostly on behalf of airline-related companies over the years. The officials spoke on condition of anonymity because they weren't authorized to discuss the matter publicly.
Daschle was a close adviser to Obama throughout the former Illinois senator's White House campaign.

He recently wrote a book on his proposals to improve health care, and he is working with former Senate leaders on recommendations to improve the system.

Organizations seeking to expand health coverage were quick to praise the selection.

Physician Foundation Report 11/18/08

2008-11-18T06:59:00.000-08:00

The Physicians’ Foundation was founded in 2003 with settlement funds from a major lawsuit against Aetna (long story). http://www.physiciansfoundations.org

The PF issued a report this morning after reviewing 12,000 survey responses from practicing physicians.

The conclusions about medicine in general and primary care in particular in the U.S. are very grim.

 Many physicians plan to retire early

 Many physicians are looking for non-clinical jobs.

 Many physicians plan to cut back on patient loads.

 There is too much paperwork.

 Some physicians want to cut back to part-time.

(There is another topic lurking here, but it is very sensitive, and will be covered in another post).

Comments:

None of this surprises me. All of it is true.

Physicians tend to grumble a lot.

Those with negative opinions may have been more likely to answer the survey.

We need more primary care physicians, but primary care is not all that attractive.

More later.

What I Have Been Reading - Part I

2008-11-17T20:24:00.000-08:00

This last spring I made a commitment that ultimately required me to read just about everything current on health care reform. Good grief!

The exercise was tiring but ultimately very worthwhile.

I have carved the various readings into categories and will occasionally post a category.

Here - important and/or interesting books. If you can read only one, I guess I would recommend Cutler, he seems to be close to the Obama track.

No endorsement of any of these books is implied, except to say that all added value to my readings.

I get most of my books now used at www.Alibris.com or www.Amazon.com (being cheap). Lot’s of Harvard professors here.

Your Money or Your Life: Strong Medicine for America's Health Care System
David M. Cutler, Harvard University
Oxford University Press U.S. (2005)
(Prof. Cutler has recently written some columns with Brad Delong.)

Redefining Health Care:
Creating Value-Based Competition on Results
Michael E. Porter, Harvard Business School
Elizabeth Teisberg, Graduate School of Business, University of Virginia
Harvard Business School Press, 2006

Market Driven Health Care:
Who Wins, Who Loses in the Transformation of America’s Largest Service Industry
Regina Herzlinger - Professor of Business Administration - Harvard
Perseus Books
1997 (paperback available)

Pricing the Priceless: A Health Care Conundrum (Walras-Pareto Lectures)
by Joseph P. Newhouse – Harvard Kennedy School
MIT Press (2004)

Saving Lives and Saving Money: Transforming Health and Healthcare
Gingrinch, Pavey and Woodbury
The Alexis de Tocqueville Institution (2003)

President-elect Obama on electronic records

2008-11-13T06:47:00.000-08:00

from the website

From: www.barackobama.com

(1) INVEST IN ELECTRONIC HEALTH INFORMATION TECHNOLOGY SYSTEMS. Most medical records are still stored on paper, which makes them difficult to use to coordinate care, measure quality, or reduce medical errors. Processing paper claims also costs twice as much as processing electronic claims. Barack Obama and Joe Biden will invest $10 billion a year over the next five years to move the U.S. health care system to broad adoption of standards-based electronic health information systems, including electronic health records. They will also phase in requirements for full implementation of health IT and commit the necessary federal resources to make it happen. Barack Obama and Joe Biden will ensure that these systems are developed in coordination with providers and frontline workers, including those in rural and underserved areas. Barack Obama and Joe Biden will ensure that patients’ privacy is protected. A study by the Rand Corporation found that if most hospitals and doctors offices adopted electronic health records, up to $77 billion of savings would be realized each year through improvements such as reduced hospital stays, avoidance of duplicative and unnecessary testing, more appropriate drug utilization, and other efficiencies.

News from Congress - follow up later

2008-11-12T05:46:00.000-08:00

from NASDAQ.com this morning

UPDATE: http://finance.senate.gov/healthreform2009/home.html

The report runs 98 pages, so you may want to wait for the summary!

Baucus To Release Call For Health Care Reform

(RTTNews) - The calls for President-elect Barack Obama to move quickly on health care reform will strengthen Wednesday with a call from the head of the powerful Senate Finance Committee, Sen. Max Baucus (D-Mont).

Baucus will unveil a "white paper" report titled "Call to Action: Health Reform 2009" at a Washington news conference.

The package will recommend policy changes in numerous areas "as a means of achieving a goal of affordable, accessible health care for every single American," Baucus' office said Tuesday.
The Finance Committee oversees major parts of the nation's health care system, including Medicare, Medicaid and the Children's Health Insurance program. It also carries jurisdiction over all tax policy changes, including those affecting the health care system.

The Baucus package joins a growing call to Obama to act quickly on health care reform.
On Tuesday, a group of four major advocacy organizations - the Business Roundtable, the National Federation of Independent Businesses, the AARP and the Service Employees International Union - sent a letter to the President-elect urging that health care reform be a priority for the administration in its first 100 days in office.

"Addressing skyrocketing healthcare costs is a critical component of stabilizing household, national and global economies," the letter said. "Inaction undermines the economic security of our families; limits the productivity of our workforce; stagnates job creation and wage growth; and threatens to crowd out investments in energy, education and infrastructure

The advocacy groups are planning a $1 million dollar marketing campaign to push the reform movement in the coming weeks............................

Why Have Physician Groups Resisted EMRs?

2008-11-11T07:35:00.000-08:00

briefing paper on EMR issues

http://www.scribd.com/doc/7961108/Why-Have-Physician-Groups-Resisted-EMRs

Have a question? Topic?

2008-11-09T06:22:00.001-08:00

Feel free to email me suggested topics or questions.

I will do my best to post on topics or answer those questions.

This blog will focus on the the finance and administration of health care, with an emphasis on what reform might do to the front lines of health care (an area neglected by economics, think tankers, etc.).

Welcome - A New Era

2008-11-09T06:07:00.000-08:00

In the 2008 election both presidential candidates promised dramatic health care reform.

President-elect Obama has promised change, and the leaders of Congress may advocate for much more dramatic reform than the President. Something is going to change, and soon!

This web log or "blog" is a small effort to discuss quality, financial and administrative matters related to health care reform.

All opinions are those fo the author/blogger.

Welcome!