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

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

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