Better Care, Lower Cost Act

MHLast week, Sen. Ron Wyden, D-Or, together with co-sponsors Sen. Johnny Isakson, R-Ga., and Reps. Peter Welch, D-Vt., and Erik Paulsen, R-Minn introduced the bipartisan Better Care, Lower Cost bill (S. 1932/H.R. 3890).

Wyden is broadly thought to have the inside track to succeed Senator Baucus – who has been nominated as the US’s next Ambassador to China – as the successor chair of the Senate Finance Committee. But despite the bill’s referral to that committee and its bipartisan support it is unlikely to reach the Senate floor anytime soon. Thus, Congress.

Consider that according to CMS 68% of Medicare enrollees suffer from two or more chronic conditions and account for 93% of Medicare spending ($487 billion). And 98% of hospital readmissions involve beneficiaries with multiple chronic conditions. Consider that today the Medicare system creates barriers preventing healthcare providers from building on successful integrated care delivery models.

The core concept of this bill – a Better Care Program – isn’t new. BCPs have been developed in various states as teams of doctors, nurses and social workers working together under a capitated payment arrangement. In seeking to monetize the success of those programs, the Better Care, Lower Cost bill has elements of the accountable care framework promoted under the Affordable Care Act, but there are important differences:

                      1. The underlying incentive for care coordination of an ACO is the belief that such coordination will lower costs (i.e., utilization) and result in shared savings. Under a BCP, care coordination is germane to the program (though the troublesome utilization disincentive seems to me to remain).
    1. BCPs are not impacted by the ACO attribution rule, which prevents providers from actively targeting and enrolling the sickest patients.
    2. BCPs can use pricing incentives to encourage participation in high-value care and patient activation, whereas patients covered under an ACO are not limited by where they can seek care nor particularly incentivized to engage in care management.
    3. Every beneficiary of a BCP receives an individual care plan, whereas ACOs are not required to create a plan for every beneficiary.
    4. BCPs are specifically designed to target the chronically ill with the intent of effectively managing those conditions as efficiently as possible, whereas the ACO attribution rule prohibits differentiation of patient condition or need.
    5. In theory, BCPs lack the volume-driven incentives of a FFS payment system that characterizes ACOs.

    Coordinating care across healthcare providers is intuitively beneficial to a patient – in much the same way that coordinating parental responsibilities is to a child. But where this bill falls short from my reading is its tight focus on the clinical and pharmaceutical aspects of chronic disease/care management. Long-term care, though not defined, is specifically excluded from a BCP’s requirements, though some provision is made for coordination of Medicaid long-term care benefits.

    If we are serious about wanting to utilize care coordination as the silver bullet to lower Medicare costs associated with treating beneficiaries with chronic diseases, then we will have to recognize taking a holistic approach that extends beyond doctors, nurses and drugs is necessary. It does little good to provide affordable therapy when the patient has no means of transportation. It does little good to prescribe a beneficial diet when they have no stove to cook. It does little good to prescribe medications when the patient cannot remember when and if they took the prescribed dosages.

    A successful caregiving team under a capitated payment arrangement must also include the housing and community-based services and supports necessary for individuals with chronic disease to effectively manage their own care. The thinking behind the Better Care, Lower Cost Act is headed in the right direction, but it just seems to me whomever was responsible for drafting it doesn’t really understand chronic care delivery very well.


Chronic Care and Technology

Whenever I think about Healthcare and Technology I am reminded of a wonderfully poignant joke that Rita Rudner (think, Rodney Dangerfield’s Young Comedians Special back in the 1980s) used to share:

"They’re trying to put warning labels on liquor now. ‘Caution: Alcohol can be dangerous to pregnant women.’ Did you read that? I think that’s ironic – if it wasn’t for alcohol, most women wouldn’t even be that way."

If it wasn’t for advancements in Medical Technology – and the attendant increase in life expectancy – one has to wonder whether the much maligned Cost Curve would hold sway over our social and political anxiety as it does today.  Undoubtedly, Medical Technology has improved delivery system effectiveness from the standpoint of decreased mortality and longevity.  But it comes at a substantial cost that ultimately impacts the cost of healthcare delivery.

The cost that society bears for increased longevity gained through technology is substantial, and we know that much of this cost is centered in the world of senior housing, aging services and post-acute/long-term care.  Evidence of the costs associated with chronic disease were explored on Tuesday at the second event of a three-part series being presented by the Alliance for Health Reform in Washington, DC.  Speakers at the event, Health Care Costs: The Role of Technology and Chronic Conditions, shared with participants some very interesting data and analysis (I encourage you to view the slide presentations).

I wish I could have participated because the presentation materials, though very informative, on balance seemed to focus more on general trends in how chronic disease drives healthcare costs rather than focusing on the specific role that Medical Technology has played.  But it nonetheless affords the opportunity to offer some thoughts on technology and the costs of managing and treating chronic disease. 

As the demographic Age Wave continues to move ashore – and taking with it an increasing amount of available resources – the theoretical discussion of tradeoffs between investments in technology and direct caregiving is likely to be become more intense.  Applying the concept of value to that discussion should not be viewed as a subjective assessment of the worth of an extra year, an extra month – an extra day of longevity by virtue of technology.  Rather, it should be viewed as a means of evaluating alternative investments of available resources.  This would seem to be a prudent basis for developing future policy surrounding public investments in technology.

Policy aside, however, senior housing and care providers face a daunting reality with respect to technology: the investment requirements can be substantial – and the consequences of making poor investments difficult from which to operationally and financially recover.  Yet to play in a world of integrated care delivery where both Information and Medical Technology provide distinct competitive advantages, ignoring required investments is just as sure a path to quiet obsolescence.

And while providers wrestle with that two-headed dragon, legislators have not yet appropriately recognized the need for parity investment in PA/LTC technology infrastructure, so many organizations are having to do what they can with available resources to position their technology investments in what they believe (hope) will be in alignment with acute care providers.  The irony here is of course thick if not beyond frustrating because the train that is integrated care delivery has left the station without the cars behind that represent the ability to achieve interoperability with PA/LTC providers.

There is also, I believe, a need of both providers – and policymakers – to understand that technology will only be able to help us so much.  It is not the silver bullet that will save us from the need to become more efficient, streamline care continuums, dramatically improve provider communication and tear down delivery setting silos.  In addition, technology may help encourage but it cannot directly change individual behaviors that could go a long way to curbing chronic disease incidence.

I would really like to better understand how different organizations are addressing their technology strategy.  Is it still a wait and watch situation? Is the need to develop EHR/EMR technology enough to deal with right now? What concerns you the most about technology? Who is involved in that thought process?

Please take a moment to share your input – don’t be afraid to be first . . . somebody has to.  Hot smile

  ~ Sparky