National Health Expenditures Data Released

Money in syringeAccording to a report released today in Health Affairs by the CMS Office of the Actuary healthcare spending growth is projected to average 5.8% over the period 2014 through 2024. In the three decades leading up to 2008 the average annual growth rate was 9%.

So let’s see. Demographics will really begin to swell Medicare participation in the decade ahead. It is likely that more states will politically have to embrace Medicaid expansion. Diagnoses and treatment innovation is still being largely driven by private investment seeking high-risk returns. Industry consolidation on both the provider and insurer sides is eliminating market price competition. And we’re only going to see 6% annual cost increases they say . . . you buying it?

Here are some highlights from the CMS press release:

Spending in 2014 is projected at $3.1 trillion, or $9,695 per person, an increase of 5.5 percent over 2013. Prescription drug spending increased 12.6 percent but private health insurance increased at 5.4 percent, Medicare at 2.7 percent and Medicaid at 0.8 percent.

Medical price inflation was 1.4 percent, while hospital, and physician and clinical services increased at 1.4 and 0.5 percent, respectively.

Per-capita insurance premium growth in private health plans is projected to be at 2.8 percent in 2015 based upon the assumptions that there will be an increase in relatively healthier enrollees and a greater prevalence of high-deductible health plans offered by employers.

Is is estimated there will be 19.1 million new enrollees in Medicare over the next 11 years.

While per capita Medicaid spending is projected to have decreased by 0.8 percent in 2014 (owing to new enrollees being relatively healthier), overall spending is projected to have increased by 12.0 percent due to Medicaid expansion.

The rate of insurance coverage in the US is projected to increase from 86.0 percent to 92.4 over the next 11 years.

The full OACT report is available online via the CMS website.

Cheers,
  ~ Sparky

Advance-Care Planning

The cover story of this coming week’s edition of Modern Healthcare (subscription required) focuses on end-of-life directives. The now infamous death panels phenomenon that became coupled with fears over the Independent Payment Advisory Board (IPAB) and rationing of knee and hip replacement procedures for Medicare recipients. I first wrote about this topic in November of 2012.

So here we are going on three years later and to my knowledge there have been no elderly individuals dragged before a panel of subjective arbiters charged with determining whether or not a person shall live or die. Not to diminish the reality of systemic rationing, as I have also written upon here – and that it will increase dramatically as an issue and concern in proportion to the demand for healthcare of an aging society.

But it has and continues to seem certain that admonishing public policy that raises awareness about the challenges of rationing and end-of-life care through increased and improved communication is rather wrongheaded. Fortunately, pragmatism seems to be winning over irrationality, and there are continued efforts to recognize the realities of having to address how scarce healthcare resources are allocated.

CMS announced last week that its proposed 2016 Medicare Physician Fee Schedule would incorporate physician payment for end-of-life conversations with patients. Though Medicare already provides for advance care planning upon enrollment the new rule would create new and separate advance care planning codes. Numerous medical societies and health organizations have pushed for reimbursement of advance-care planning as a separate, stand-alone service.

In good part much of the support was a desire to be paid for work already being performed. But to some extent it also represents an incentive to provide a service. And there’s the rub: what’s being incentivized? Education and awareness – or an inherent bias to abridge care and treatment options in favor of resource conservation that could be manifested in income to the clinical practitioner?

Indeed, it’s a slippery slope, and we need to be vigilant in understanding the impact of frequently dramatic differences between how an end-of-life is planned and what actually takes place at care settings in the hands of clinicians whose primary directive is to preserve life. From a policy perspective there are multiple elements that may yet contribute more to this discussion (e.g., the apparently defunct IPAB and the Patient-Centered Outcomes Research Institute).

For now, however, there is a greater opportunity to empower patients with more knowledge and information to assist them in their personal decision making regarding end-of-life care. That’s a good thing.

Cheers,
  ~ Sparky

Image credit: Martin Kozlowski for WSJ

Health and Housing Task Force

BPC_logo2The Bipartisan Policy Center, founded in 2007 by former Senate Majority Leaders Howard Baker, Tom Daschle, Bob Dole and George Mitchell, today announced a new Health and Housing Task Force that seeks to help address the needs of an aging US population. The one-year initiative is to be led by former HUD Secretary Henry Cisneros, former Senator and HUD Secretary Mel Martinez and former Representatives Allyson Schwartz and Vin Weber.

In echoing research and observations made in the recently released report, Housing America’s Older Adults: Meeting the Needs of An Aging Population, prepared by Harvard Joint Center for Housing Studies and the AARP Foundation, the BPC notes the glaring disconnect between forecasted housing, services and care needs as compared to our current ability to meet that demand.

In explaining the task force’s direction Mr. Cisneros noted that, “our aim is to call attention to this emerging challenge facing our nation. This challenge offers incredible opportunity in the near-term, yet is on track to become a major crisis in the coming years if left unaddressed.” Specific goals outlined by the task force include:

Find cost-effective ways to modify homes and communities to make independent living for seniors safe and viable. Identifying potential funding sources will be critical.

Highlight best practices from states and localities for integrating housing, health care, and long-term services and supports. The task force will seek out programs that work and investigate how they can be replicated elsewhere.

Identify barriers to offering home-and community-based services and supports through Medicaid.

Seek opportunities for further collaboration between the Departments of Housing and Urban Development and Health and Human Services.

The fourth goal is something that I have been scratching my head about for more than a decade now. I once even had the chance to personally ask a former HHS Secretary why the two departments couldn’t find more ways to collaborate, and that person was surprisingly candid in not knowing why either.

I know it may seem intuitive to those working in senior housing and care, but still much of the healthcare industry is only starting to recognize and understand that if services and care need to be provided “long-term,” then those individuals requiring such care need a place to live – they need a home. Further, we are learning more every day that underscores how important it is to have hospitality services provided in coordination with that care in order to achieve a beneficially holistic approach to health and wellness. Thus I believe any successful delivery model that addresses the crisis this task force sets out to address must reflect a deep understanding of four core areas:

Real estate – a place that can be called home wherever that may be

Operational & clinical performance: consistently safe and high quality services that are unique to the populations being served

Hospitality: recognizing and respecting the human spirit’s desire to live a fulfilling life

Underwriting: understanding the unique financial challenges of providing extended services and care

I would encourage the task force – and any other organizations involved in assessing and contributing to the knowledgebase that increases access and affordability of senior housing and care – to adopt these as the four pillars of any successful delivery model.

Cheers,
  ~ Sparky

To Sleep Perchance to Die

Hamlet___Skull_Study_by_PaulJulianBanksEarlier this week the French parliament acted in a compassionate – and certainly controversial – fashion by passing a law that will allow terminally ill patients to opt for “deep sleep” as an alternative to and/or palliative care. Lawmakers there believe (and by a substantial majority) the measure does not legalize euthanasia, but not everyone agrees. And the applicability of such a policy decision to America’s struggle with healthcare cost containment could not be more profound.

Depending on which study you want to believe, it is estimated that between 25% and 30% of all Medicare spending each year goes toward the 5% of beneficiaries who die in that year. Of that, approximately one-third of expenditures occur in the last month of life. If it weren’t for the realty that life is the most precious commodity on earth, it would be a rather simple fete accompli that such investment is ludicrous.

But any discussion of healthcare policies touching upon end-of-life care is rife with raw emotion and often political hysterics. Death Panels anyone? While Sarah Palin may have done more personally than anyone in history to obfuscate rational, intelligent discussion on reconciling individual rights with social responsibilities she nonetheless hit the mark in connecting the end-of-life care conversation to rationing: because that’s a core element of the policy debate – and it needs to be.

The talking points surrounding healthcare policy that affects end-of-life care are, however, spreading beyond just rationing – as the actions in France indicate. There is a shifting cultural perception of death as not so much a medical problem as it is a spiritual reality that can only be effectively addressed by one person – one moment at a time. And the quality of life vs expenditure is an emerging debate that will be owned by the Baby Boomer generation in a way this country has never seen.

Do the actions of the French lawmakers reflect a cultural awareness that is progressively ahead of where we stand in the US? Or do they reflect the further advance of progressive abandonment of respect for the sanctity of life that we must stand fast to defend?

Before answering, consider . . .

To be, or not to be, that is the question—
Whether ’tis Nobler in the mind to suffer
The Slings and Arrows of outrageous Fortune,
Or to take Arms against a Sea of troubles,
And by opposing, end them? To die, to sleep—
No more; and by a sleep, to say we end
The Heart-ache, and the thousand Natural shocks
That Flesh is heir to? ‘Tis a consummation
Devoutly to be wished. To die, to sleep,
To sleep, perchance to Dream; Aye, there’s the rub,
For in that sleep of death, what dreams may come,
When we have shuffled off this mortal coil,
Must give us pause.
~ Hamlet, Act III, Scene i

Cheers,
  ~ Sparky

Picture Credit:
Hamlet – Skull Study by PaulJulianBanks

Does Measuring Quality Drive Value?

businesswoman drawing diagrams on wallThe Centers for Medicare and Medicaid Services today announced release of the 2015 Impact Assessment of Quality Measures Report. Designed to relate the performance on quality measures over time, it includes research on 25 quality programs and hundreds of quality measures from 2006 to 2013.

Key findings of the report include:

Overall quality measurement results demonstrate significant improvement over time.

Race and ethnicity disparities present in 2006 were less evident in 2012.

Provider performance on CMS measures related to heart and surgical care saved lives and averted infections.

CMS quality measures impact patients beyond the Medicare population.

CMS quality measures support the aims of the National Quality Strategy (NQS) and CMS Quality Strategy.

There is an old management adage that goes, “what cannot be measured cannot be managed.” It is from this vantage that CMS advocates for the role quality measurement plays in achieving the desired goals of improved access, better outcomes and lower cost (the infamous Triple Aim liberally interpreted by me). While the data may support improvement in performance indicators, that does not necessarily translate into value.

And value is (or ought to be) the universal currency of the Triple Aim

Recall, I have shared here often that value in healthcare is defined as outcomes divided by cost – and that measuring outcomes is a bit like trying to nail Jell-O to the wall. Measuring and reporting on quality in other industries has proven to be a useful endeavor that underpins market efficiencies. It’s not the availability and use of information derived from such endeavors that I wonder about – but who uses it and how.

Consumers that are armed with information on product and service quality from organizations like Consumer Reports are better able to navigate the value paradigm and reconcile their wants and needs against affordability. But in healthcare, consumers (patients) largely still don’t get to do that regardless of how much Big Data is collected, analyzed and reported on by CMS.

Will future efforts to capture all of the nuances that influence how individuals determine the value of an outcome ever be adequately captured by Big Data analytics in a fashion that such knowledge can supplant the simple effectiveness of personal decision making in a free market? CMS is banking on it.

What say you?

Cheers,
  ~ Sparky

Health Care Payment Learning and Action Network

Back view of businessman drawing sketch on wallAs shared here in the Pub at the end of January (Value-Based Payment: The Rush Is On) HHS has set a goal of migrating 30% of all Medicare payments to alternative payment models by December of next year – and 50% by the end of 2018. Overall the goals of having all payments tied to quality or value are 85% and 90% during the same periods, respectively.

Commensurate with these initiatives CMS today announced the establishment of the Health Care Payment Learning Network, to provide a forum for public-private partnerships to help the U.S. health care payment system (both private and public) meet or exceed recently established Medicare goals for value-based payments and alternative payment models.”

The Network will perform the following functions:

Serve as a convening body to facilitate joint implementation of new models of payment and care delivery;
Identify areas of agreement around movement toward alternative payment models and define how best to report on these new payment models;
Collaborate to generate evidence, share approaches, and remove barriers;
Develop common approaches to core issues such as beneficiary attribution, financial models, benchmarking, quality and performance measurement, risk adjustment, and other topics raised for discussion; and
Create implementation guides for payers, purchasers, providers, and consumers.

CMS is asking for payers, providers, employers, purchasers, state partners, consumer groups, individual consumers, and others to join the network in order to participate in the discussion and debate on how to transition toward the aforementioned goals via alternative payment models. The Network is to be convened by an independent contractor that will help ensure it operates independently of HHS, CMS and other governmental entities while supporting the efforts of Network participants.

A Guiding Committee made of participants from the Network will be created to act as a clearinghouse of topics and ideas and to help prioritize discussion topics based upon the input they receive from Network participants. The frequency of meetings is to be determined but it is intended that most will be held virtually via teleconference and/or webinar. A kickoff event is being scheduled for Wednesday, March 25th.

I have signed up as a network participant to follow the activities and information provided from the Network and will share more on this blog down the road.

Cheers,
  ~ Sparky

Top Healthcare Policy Themes of 2014

Yesterday on the Policy Prescriptions website curator Cedrick Dark, MD, MPH, FACEP, shared his list of top tweets in 2014, each referring to a story or graphic. I have with gratitude to Dr. Dark recast that list below for Pub patrons, highlighting the key policy area focused upon.

Cheers,
  ~ Sparky

Medicaid Expansion: Will it really reduce ER utilization?
A story by @sarahkliff  on January 2nd in the Washington Post

Population Health: How much of the US’s poor performance on value can really be explained away?
A
graphic shared by @davidmwessel on March 3rd

Industry Consolidation: Will it be a case of Be careful what you wish for . . . ?
A story by @philgalewitz in the Washington Post on April 21st

Big Data & Health Policy: What can two Medicaid studies – Massachusetts and Oregon – teach us about public health statistics and policy?
A post in The Incidental Economist by @afrakt on May 7th

Mental/Behavioral Health: Is Medicaid expansion an effective way to address the epidemic rise in MH/BHS and substance abuse?
A graphic from the American Health Counselors Association on May 27th

Physician Shortage: What’s the truth – can we know – about Healthcare Reform’s impact on physician supply relative to demand?
A story by @amitabhchandra2 in Vox on July 31st

Cuts in Provider Reimbursement: Is cost cutting via physician compensation having unintended – dire – consequences?
An Op-Ed piece in the New York Times by @sjauhar on July 21st

Value in Healthcare: “People bankrupt themselves to get healthcare and that means it’s incredibly valuable, unless one thinks people are incredibly stupid.”
A tweet shared by @amitabhchandra2 on May 6th

The Non-Healthcare Side of Healthcare: Only 20% of health outcomes is determined by clinical care
A graphic provided by @CHRankings on October 25th

Politics of the Affordable Care Act: Will Jonathan Gruber become the sacrificial lamb for an administration and congress that duped the stupid American voter?
A CNN news piece by @jaketapper on November 19th

National Healthcare Spending: Where does $2.9 trillion get spent?
A graphic in the Washington Post on December 3rd

The Uninsured: The Administration claims 10 million have gained health coverage. Not everyone agrees on the methodology used.
Official release from @WhiteHouse shares this and other portended accomplishments in 2014 on December 19th

The Cleveland Clinic’s Big Gamble

When I first started speaking on the Affordable Care Act back in the fall of 2010 one of the observations I liked to make was about needing to change the cost trajectory resulting from chronic disease. I would say something to the effect that, “if we are somehow successful at becoming more efficient, expanding access and affordability – none of it is going to matter if we cannot become a healthier country.” I didn’t have any research or statistics to support my thinking – it just seemed axiomatic given a fundamental understanding of disease incidence, costs and demographics.

My good friend and colleague Dr. Toby Cosgrove, President and CEO of the Cleveland Clinic (okay, so we’ve said hello to one another on a few flights back and forth from Ft. Lauderdale) posted an article on his LinkedIn blog this morning: New Way to Fight Chronic Disease that puts some meat on the bone of my rudimentary understanding of public health. Dr. Cosgrove notes some very basic facts about chronic disease management in the United States.

  • The CDC estimates that 75% of all healthcare expenditures in the US are attributable to chronic disease ($2.85 trillion in 2013)
  • Almost one out of every two adults (117 million) is afflicted by chronic illness
  • More information on the impact chronic disease has on our healthcare system can be found on the CDC website.

Dr. Cosgrove’s article introduces the Cleveland Clinic’s recently opened Center for Functional Medicine, which is a collaboration with the Institute for Functional Medicine led by Dr. Mark Hyman. The thematic focus of the Center is to take a more holistic approach to individual health and wellness and driving at the underlying causes of chronic disease – whether related to genetics, environment or lifestyle.

Functional Medicine is not intended to be a replacement of traditional medicine. We aren’t talking about spiritual healing, wild berries and unproven treatment regimens. It is intended to recognize and address the underlying causes of chronic disease that, if effectively addressed, will reduce the need for traditional medicine. But it also should be able to compliment and enhance the effectiveness of traditional medicine.

Given the magnitude of the problem and the impending consequences on our country it is exciting news that a medical institution no less than the Cleveland Clinic has chosen to proactively attack this problem with pragmatism and innovation. That’s the good news. Now here’s the bad: human nature is an incredibly obstinate challenge that isn’t likely to bow in the face of the best efforts of worthy institutions such as the Cleveland Clinic.

Understanding the underlying causes that lead to chronic disease is one thing. Being able to change human behavior in a manner that addresses those causes is quite another altogether. And this tees up a host of moral policy conundrums where we start to look at responsibility of the individual versus society. Demographics will intensify these to a level that I suspect will lead to significant social unrest.

So while I applaud the Cleveland Clinic for taking the bull by the horns in seeking to address this immeasurable challenge facing us, I do hope they understand what happens if they let go.

Cheers,
  Sparky

Does Legislative Negligence Trump Legislative Intent?

The Supreme Court today agreed to hear the King v. Burwell case, which – similar to Halbig v. Burwell, wherein the DC Circuit Court ruled against Burwell (i.e., the Affordable Care Act) in July – challenges the legality of tax subsidies used to offset the cost to individuals buying health insurance through federally administered exchanges. As the ACA was written subsidies were to be available through state run exchanges, but since most states opted out of creating and running their own exchanges more than two-thirds of everyone who signed up for health insurance did so through federal exchanges. Of those, approximately 85% – or 5 million people – received subsidies at an average value of approximately $3,200 per year.

Those folks stand to lose that benefit – and in many cases likely health insurance –if SCOTUS determines that the letter of the law should supersede legislative intent. Beyond that, given the actuarial models supporting expansion of individual health insurance under the ACA the prospective financial viability of that expansion would likely becomes untenable.

Congressional staffers had already been discussing ideas of how to work around the loss of tax subsidies – but that was before this Tuesday. The new sheriff in town won’t be very anxious to support legislative efforts that seek to save Obamacare in any fashion. What can be done through regulations? My guess is not much, so a ruling in favor of King would likely be the devastating blow detractors have been chasing since March of 2010.

From a retrospective standpoint this is just another serious distraction in a long line of legal and administrative obstacles that have become part and parcel of legislative implementation. It reflects the urgent and manipulative manner in which the Affordable Care Act was rammed through passage in March 2010 following a string of made-for-TV political events that played out beginning with the death of Senator Ted Kennedy in August 2009.

Ever since then Republicans have argued that a policy initiative of the breadth and scope of the Affordable Care Act necessarily should have been subject to broader bipartisan support, such as what would have been required through a normal reconciliation process of the two House and Senate bills. While at the same time Democrats have argued Republicans’ expressed concern has largely been a case of “protesting too much” and only really being concerned with stopping any legislative initiative of the President, regardless of its policy merits.

In any event, what SCOTUS will have to wrestle with is attempting to understand the contextual purpose of the health insurance subsidies and whether legislative intent is a sufficient enough consideration to disregard the stated restriction of those subsidies to only state run exchanges. As someone who has supported the ACA I don’t share this from the perspective of looking for any opportunity to blow it up. But I think it has to be taken into consideration by the Court that the law’s contorted framework and structure is a theoretical obstacle for accepting the legislative intent argument.

How can you accept legislative intent as a theoretically understood precept for a provision of an act that in several significant instances (i.e., CLASS, the employer mandate, renewal of noncompliant plans, special enrollment and hardship exemptions), has not been implemented as intended? Are the justices required to not consider legislative enactment and just look at the Act independently of the apparent disconnect? I’m not a lawyer, so maybe I am just thinking of this like a four year old – but then someone is going to have to explain to me what’s wrong with my logic.

Cheers and enjoy the weekend,
  ~ Sparky

Mental Illness Is A Community Disease

For those Pub patrons interested in being kept informed on happenings affecting the futureneeding-mental-health-care of mental health policy in the US. the Substance Abuse and Mental Health Services Administration (SAMHSA) will be holding a public listening session next Wednesday, November 12th, to solicit input and feedback on the establishment of criteria for  the Certified Community Behavioral Health Clinics (CCBHC) Demonstration Program, as outlined in Protecting Access to Medicare Act (P.L. 113-93, Section 223).

    The demonstration program was originally introduced as the Excellence in Mental Health Act by Senators Stabenow (D-MI) and Blunt (R-MO) and U.S. Representatives Matsui (D-CA) and Lance (R-NJ) and is an effort to strengthen community mental health systems by establishing higher standards of care and better coordination and communication across individuals, organizations and agencies that provide assistance and care to individuals in their communities. 

Under provisions of the Act, which was an extender bill used to delay until March of next year pending cuts to Medicare, a maximum of eight states will be selected to participate in a two-year demonstration program whereby the federal government will pay a matching percentage to those states for providing medical assistance for mental health services equal to what Federally Qualified Health Centers (FQHCs) currently receive for primary care services. This is strictly an outpatient clinic initiative (i.e., no funding for inpatient care, boarding, residential treatment).

Example services to be provided by CCBHC’s under the demonstration program include 24-hour crisis management, screening assessments and diagnostic services, outpatient mental health and substance-abuse services, primary care screening and peer support and counseling. The HHS secretary is to determine criteria for a clinic to be certified by a state as a CCBHC no later than September of next year. Next week’s session will solicit input on criteria such as,

  • staffing requirements: e.g., qualifications, areas of experience & expertise, licensing and credentialing, recruiting;
  • availability, scope and accessibility of services: e.g., looking beyond crisis management, determining basis of financial responsibility, evidencing service and referral relationships;
  • care coordination: e.g., relationships with other providers, integration into and with community services and agencies, enabling technical requirements;
  • governance, accountability & reporting: e.g., organizational authority, measuring outcomes, evidential reporting.
  • The secretary is also directed to provide guidance for the establishment of a prospective payment system for this demonstration program, no later than Sept. 1, 2015.

    As I have shared in this space numerous times before, mental and behavioral health services are underfunded and inadequately available to meet the growing needs across the country. We are learning more every day of the evidentiary benefits – to the individual and society – of taking a holistic approach to individual health and welfare. I am hoping to learn more next week whether and how this demonstration program might lead to addressing this critical concern – and I will report back what I learn.

    Cheers,
      Sparky

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