ACOs, Innovation and Edison
Jul 13, 2013

ACOs, Innovation and Edison

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070209_edison_bulbUnited Healthcare announced this week that it will double to $50 billion annually over the next five years the value of contracts it has with doctors and hospitals based on quality and outcome measures. United is currently paying over $20 billion annually to doctors, hospitals and ancillary care providers under contractual arrangements based on value produced (i.e., quality outcomes over cost).

United’s Chief Medical Officer, Dr. Sam Ho, notes that “any bonuses will have to be earned and no longer a product of turning a page on a calendar – this is not a passing fancy for us. The United Healthcare strategy basically has expanded the accountable care concept to an accountable care platform.” Beyond just the symbolic importance, United has the largest provider network in the U.S. and already has accountable care relationships in place with over than 575 hospitals, 1,100 medical groups and 75,000 physicians.

Now, the glass-half-empty folks in healthcare are going to look at this move by United as somewhere between tyrannical, prehensile or just plain foolish, depending on individual perception, as well as position. They will argue this is just another example of non-provider influences in healthcare stealing more power from the patient. They will remind us again how HMOs failed and that ACOs are but profiteering wolves clothed in retrofitted HMO attire.

Of the two most significant challenges that ACOs face, creating financial incentives that are theoretically aligned with less care instead of more is certainly reminiscent of managed care circa 1990s – and it is a risk that must be aggressively monitored and mitigated. The other primary challenge – the inherent subjectivity of measuring patient outcomes – will have a dramatic impact on many areas of future healthcare delivery, not just provider networks and insurance contracting. It’s a challenge that will have to be effectively addressed if we ever have any hope of increasing access without bankrupting the country.

I think there are two ways to look at these challenges: in the context of the past where abundant evidence of failure exists – or in the future, where evidence of failure has not yet been created. There is a critically important difference between the two. The former is the world of intellects and philosophers, while the latter is the world of innovators and entrepreneurs. Case in point: Thomas Edison.

In failing continually to invent the light bulb Edison once remarked, “I have not failed. I’ve just found 10,000 ways that won’t work.” In similar fashion he once said, “negative results are just what I want. They’re just as valuable to me as positive results. I can never find the thing that does the job best until I find the ones that don’t.”

I am not suggesting that unbridled experimentation is either wise nor prudent when the results impact human lives. But I also choose to resist the defeatist attitude among folks who become overly dependent upon history as a means of defining the future. While those who fail to learn from the past may be damned to repeat it – those who live in the past are damned to avoid innovation for fear of failure.

The underlying premise of the ACO model – financial reward for keeping people healthy, rather than reimbursement of costs for trying to make sick people well – represents a dramatic paradigm shift in thinking for this country that transcends all aspects of healthcare delivery. We should not expect it to be widely embraced in the short run. We should rightly expect a healthy amount of skepticism. And we shouldn’t be shocked if the model fails.

Those allowances, however, should not be permitted to thwart progress toward achieving expanded access to quality care, particularly for the least fortunate among us. If the failures of the past weighed most heavy on the efforts to define the future, we should not have to worry about how to make quality care available because there never would have been the advances achieved worth making available. Edison also once said that, “the doctor of the future will give no medication, but will interest his patients in the care of the human frame, diet and in the cause and prevention of disease. ~ ”

Will he be right?

Cheers,
  Sparky

Filed Under: Accountable Care Organizations, In the News · Tagged: , , , ,
Healthcare Strategy Lesson From Gettysburg
Jul 9, 2013

Healthcare Strategy Lesson From Gettysburg

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GThis past weekend my son and I traveled to Gettysburg to partake in the 150th Anniversary celebration. It was our third trip together there, the last being four years ago when he was six. I have been there at least eight times myself dating back to when I was his age.

You have to be of a certain ilk to enjoy returning to a small town in the summer sweatbox of southern Pennsylvania so many times expecting it to offer more than the time before. Yet for me it has – and did so again this time. Now, I am admittedly one those individuals whose interest and fascination in the Civil War has been manifested in owning more books on the subject than I should ever hope to read.

That perceived restriction is in good part due to the other areas of interest that compete for my attention. Chief among those, I am particularly interested in most all aspects of military strategy. The word, strategy, after all is from the Greek word, stratēgia (στρατηγία), meaning the art of the troop leader or general – to command and provide generalship.

To be sure, I have learned a great deal about organizational strategy and strategic planning from contemporary writers such as Porter, Mintzberg, Ansoff and Chandler to name but a few, but in due time I have found most of their thinking reflects new ways of viewing the foundational principals of strategy that can be found in the works of military strategists such as Sun Tzu, Alexander, Napoleon, Bismarck – and Robert E. Lee.

On my visits to Gettysburg what I enjoy most is walking the battlefields and just looking at the surrounding countryside. Beyond its purely aesthetic benefit I try to imagine what faculties, training and experience it would have taken to translate observation into action (i.e., if I were a commander, how would I have deployed my forces). What makes that three-day conflict so intriguing for the military historian are the strategies employed by both sides in seeking tactical advantage through positioning. Who familiar with the Civil War has not heard of Little Round Top?

If you are an organizational strategist, you cannot help but appreciate the dynamic relationship of planning and positioning. Effective planning is measured by the ability to achieve a future position while being developed based upon current position. And this is where very often strategic planning at healthcare organizations falls well short of its promise. In my experience, the inability – or perhaps unwillingness – to develop a comprehensive and realistic understanding of their organizational current state before engaging in planning efforts is the single biggest mistake healthcare organizations make. It is also the singular key to successful planning efforts.

Too often healthcare organizations get caught up in the chaos that defines their environment. They spend significant amounts of time and effort trying to understand what is happening around them, unfortunately at the expense of understanding what is happening within their own organizations. The old saying of, “if you don’t know where you are going, any road will get  you there” has recognized validity. But the blinding attraction of imagining a better future can also serve as a siren to organizational leadership causing them to lose sight of practical realities.

The key lesson that was reinforced for me on this latest trip to Gettysburg was that while the ability to envision how infrastructure and topography could be utilized to establish tactical advantage, in order for underlying strategies to be effective the commanders of both armies had to first understand the capabilities of their forces. They had to understand the relative effectiveness of munitions based on distance, angle and elevation. They had to understand how and when troops could be deployed and redeployed between positions. They had to understand why holding a position is ultimately critical to being able to achieve a position.

From a strategic planning perspective, these are lessons I think have tremendous applicability to healthcare organizations, particularly as they seek to make sense of the ever changing regulatory environment in which they operate. If I were to borrow from the old adage, “measure twice – cut once,” I would offer that in organizational strategic planning it is wise to spend one hour envisioning where you want to be for every two hours assessing and understanding where you are right now.

Cheers,
  Sparky

Filed Under: Editorials & Opinions, Strategic Planning · Tagged: , , , ,
Will the Truth Destroy Us?
Jun 30, 2013

Will the Truth Destroy Us?

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Julian-Assange-Cuero1In the New Testament (John 8:32) it was written that, “you will know the truth, and the truth will set you free.” That certainly hasn’t been the recent experience of Julian Assange and Eric Snowden, but then discretion is not always the better part of valor where personal bravery involves risking the lives of others without their knowledge or consent.Snowden

This post is not directly about healthcare public policy, but I don’t think Pub visitors will have to search too hard to see relevant application. And if you bear with me, I try to bring it back home in the end.

In the history of our world great strategic advantages – as often manifested in terms of wealth, power and influence – have been gained through the ability to possess (and then act upon) knowledge and information that others do not. And unfortunately, a lot of public policy throughout history has been crafted and enacted for similar purposes with varying degrees of actual or perceived intent.

Now consider that historic reality in the context of what we are witnessing today with the accelerating proliferation of intentional (and unintentional) electronic content being made available to millions upon millions of individuals at the click of a mouse. Consider it too in recognition of the rogue efforts of Messrs. Assange and Snowden who have ensconced themselves in cloaks of social consciousness that to many of us look a lot more like what Andy Worhal had in mind when he coined the phrase, “in the future, everyone will be world-famous for 15 minutes.”

Whether this emerging phenomenon is couched in the recreational context of social media, the enterprise context of online marketing and promotion or the aforementioned often invoked public policy context of transparency – the resulting abject conundrum facing modern societies and public policy makers is mind boggling. Whosoever has said they would like to know the mind of God has only to reflect upon this reality a bit to know how impossible that is to even begin imagining.

As I see it, there are three aspects to assessing this phenomenon: access, discernment and reasoning. Of these, I think access is the most difficult to assess in terms of its ability to be socially impactful. On one level, it is the great equalizer – the rallying cry of anyone who believes oppression is caused by those who withhold information for the sake of power and influence. On another level, its true value is primarily dependent upon the other two aspects.

To demonstrate, think of the game of Poker. Playing a hand of five-card stud with all cards up ensures everyone has the same information at the same time – yet anyone who has ever played knows there is much more to winning than just knowing what everyone else can see. I am again reminded of that most famous quote from Sun Tzu: “All men can see these tactics whereby I conquer, but what none can see is the strategy out of which victory is evolved.” From a public policy perspective, the point is not to confuse promoting access with promoting equality: one does not infer the other without discernment and reason.

Discernment, in turn, cuts the value of access in half, or worse. It represents the ultimate double-edged sword of information management because it is just as easy to manufacture disinformation as it is to make available factual information. Actually, it is in fact easier to create disinformation because the burden of proof is relieved. Being able to discern one from the other, therefore – and to do so more quickly than the next person – will have tremendous strategic advantages in the future. And those who innovate the means to accelerate the process of reliable discernment stand to be very rich.

In what is a sad irony, a key role of government based on history should be the promulgation of public policy that helps effectuate discernment. But the relationship between information and power referenced above is a vicious and virtual simultaneous equation in this electronic age, and nowhere is that relationship more complex and threatening than where it involves elected officials. Just throw corruption into the mix and not only do you have the fox guarding the hen house but now also the lack of any accountability for who put the fox in charge.

And finally of course, although access and discernment may go a long way to at least conceptually equalize the playing field in providing the information needed to make decisions and judgments, that certainly does not ensure everyone of having the same ability to perform either. And this is where I think the unenlightened disconnect of the Gen X and Gen Y generations becomes truly evident. That is not a criticism, but rather a factual reality just as much as one day equals 24 hours while two days equals 48.

To my understanding, the human mind cannot be trained through study or discourse to accomplish the same functional abilities that can be gained through experience. For a wonderful treatise on this subject-matter I once again refer Pub visitors to Malcolm Glawell’s work, Blink. To state this point more plainly, data becomes information when it is organized; information becomes knowledge when it is analyzed; knowledge becomes wisdom when and only as it is allowed to age and gain from the benefit of life’s experiences.

Thus, having more data (i.e., Big Data) can advance the creation of more knowledge and information – but it cannot advance the creation of wisdom, at least not human wisdom (Watson and the like are another story). And this now brings us back full circle to healthcare policy. A lot of people have benefitted and been able to live healthier lives because of the wisdom of healthcare providers, and in particular nurses and physicians. If there were one guiding principal I would like to posit with respect to the development of policies that will impact the storage, dissemination and flow of electronic information in the future, it would be that such policy should not seek to promote the advancement of knowledge and information at the expense of wisdom.

Cheers,
  Sparky

 

 

Filed Under: Editorials & Opinions, Social Media · Tagged: , , , , , , ,
Mental Health Policy: It’s Not As Hard As You Don’t Think
Jun 19, 2013

Mental Health Policy: It’s Not As Hard As You Don’t Think

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Mental-health-problems-007In my work with healthcare providers and community-based services organizations over the past two years there is one recurring theme that continues to present itself at multiple levels – i.e., personally, professionally and socially: that is the growing awareness of how critically important it is to  integrate mental and behavioral health services with primary care.

Unfortunately, at a popular level mental health in the US has long been synonymous with a disease state – something that needs to be fixed, or at least treated.  The irony of this of course is that we have spent decades worrying about how to fix our healthcare system while all the while forgetting that what we have really had for years is a sick-care system. We care for people when they are ill – we don’t really have an effective system in place to keep them well.

And yet there really isn’t compelling evidence that indicates social investments in health and wellness provide good return on those investments. Education and awareness haven’t had the intended impact. Why?

Could it be that the same underlying drivers impeding the success of health and wellness activities are also manifested as root causes of a variety of physical illness and disease? In other words, in only regarding mental health as a means to cure a problem rather than the promotion of a desired natural state of being are we neglecting a critical element of healthcare reform? I think so.

Admittedly, the policy considerations surrounding mental and behavioral health services are extremely complex, in large part because they interact with so many other policy areas; e.g., Housing, Employment, Criminal Justice and FDA Oversight – just to name a few. Nowhere is this more evident than with one of the most proliferate and threatening elements of mental and behavioral health in America today: addiction.

Rather than try and put forth a meager attempt here to explain the hows and wherefores of addiction, mental health and public policy, I would rather refer Pub visitors to a wonderful post by the One Crafty Mother, Ellie Schoenberger.  In what she titles the most important post she’s ever written, Ms. Schoenberger does a fantastic job of putting a framework around the impact addiction has on society – and how it must be understood from an individual, social and public policy perspective if we are to develop effective policy to address this growing epidemic.

I think it’s a great place to start a discussion, and I hope you will take the time to read it.

Cheers,
  Sparky

Filed Under: Behavioral Health and Substance Abuse · Tagged: , , , ,
May 21, 2013

A Pub Celebration!

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FireworksI completely missed the One Year Anniversary of Sparky’s Policy Pub, which was last Tuesday (business is good, and nobody’s complaining). In the past year I contributed 70 posts that generated  roughly 3,600 views. Whether that’s above, below or right about average I have no idea. But I have had  a lot of fun writing each and every post, which was my goal to begin.

And it has been fascinating to follow the blog stat’s. My number one post continues to be Death Panels Just Won’t Die, which is hit upon most often by folks searching for information on whether knee replacements will be rationed under the Affordable Care Act. It’s for that very reason that post is also my favorite, as I tried very hard in it to combat the misinformation that exists about the Act and how that misinformation has been used to scare our most vulnerable members of society.

So to anyone and everyone who has taken the time to stop by the Pub and read my posts, I want to sincerely thank you for your time and interest. While I find great enjoyment in just having a reason to write, the recognition that comes from knowing someone else finds what I write worth their time to read is very special and very meaningful to me.

I have learned a lot on how to create content that is valuable, interesting and entertaining. I still have a lot to learn, and I am anxious to see where the year ahead will take me – and the Policy Pub.

See you in the Pub!!
  ~ Sparky

Filed Under: In the News, Public Policy · Tagged: , , ,
May 19, 2013

At What Price Transparency

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On May 8th the New York Times headlined the article, Hospital Billing Varies Widely, Government Data Shows.  For Democrats, further evidence that hospitals continue to use their market prowess to gouge the poor and uninsured. For Republicans, further evidence that the Affordable Care Act is failing miserably in controlling costs and empowering consumers. For news reporters, fodder for controversial content. For anyone who has worked in healthcare for any meaningful time – a BIG YAWN (see also, Pick a Price, Any Price, addressing this phenomenon from a Consumer-Driven Healthcare perspective).

It’s not just a non-story but a very old and very tired non-story as well. The cause and effect relationship between the cost of resources that go into delivering care at hospitals and the established charges for that care (i.e, the hospital charge master) bears a weakly causal relationship at best. That reality is a result of the Medicare reimbursement methodology (and, in turn, other governmental programs – e.g., Medicaid – as well as commercial insurers largely adopting very similar approaches).

Healthcare reimbursement in the US is a long and complicated story and one that, from a financial perspective, has seen many winners and many losers – neither of which group represents the individuals that are supposed to benefit from healthcare: the patients. If I can try to sum up the experience of the past half century it would be that effort upon effort has been made to develop systems that fairly reimburse healthcare providers for their costs plus a profit (or income, as it were for the individual).

There are two major problems with cost-based reimbursement: the first is the ability to prospectively allocate overhead costs in a logically consistent manner for a production model that is extremely complicated and constantly changing; the second (and a by-product of the first) is the faulty logic that holds historical production/cost relationships are reasonable predictors of future costs, which belies the effects of innovation, efficiency and productivity improvements.

So why am I jumping on the bandwagon to beat a dead horse. Because I believe the media attention focused on the wide variability in hospital pricing is symptomatic of a much bigger challenge we have in healthcare delivery – and in turn, healthcare public policy: that is, transparency. And in an age of electronic information enlightenment, the public policy issues surrounding transparency both transcend and go well beyond healthcare.

Take for example the two current scandals adding more paralysis to an already ineffective government in DC (as if that were possible).  In the first, the IRS appears to have selectively targeted 501(c)(4) applications based, at least in part, upon political motivations.  In the second, the Justice Department secretly obtained phone records of AP reporters last year stemming from concerns over national security leaks. Information is power – and power easily abused, particularly when the stakes are high as in politics.

The term, transparency, calls up thoughts of truth, honesty, candid, forthright – all terms that are generally consistent with values espoused by the better parts of our nature. So it is a difficult reconciliation that the promotion (or abuse) of transparency can lead to information ending up in the hands of those for whom it was never intended. In other words, as the recording, storage and sharing of electronic information proliferates transparency and privacy are going to increasingly become public policy enemies.

And other than issues of national security nowhere is this confrontation already more acute than in healthcare. Concern over patient privacy has long been one of the primary obstacles to IT adoption in healthcare, and right that it should be. What is more private than our individual health records? But the knife cuts both ways as we know. Under our legal system, quite often the right of privacy is abused as a faux obstacle impeding transparency. This is often manifested in healthcare as over charging third-party payers for services and care not actually provided.

A common theme of the Affordable Care Act is the promotion of transparency with particular emphasis in two areas: patient outcomes and cost data. While the latter faces allocation methodologies and consistency challenges, the former faces the additional challenge of subjectivity in establishing measurements. These are challenges that absolutely must be overcome.

Transparency in healthcare is a necessary prerequisite to patient empowerment, which has the potential to drive organic performance improvement that doesn’t come at the cost of additional regulatory oversight. Transparency is also a prerequisite to determining value (i.e., outcomes divided by costs), which is the basis upon which many employers, commercial insurers and governmental programs are developing new healthcare payment models (i.e., payment for value – not volume).

Throughout history strategies of both business and war have often depended upon the advantage gained from having access to information where others do not. Whenever there are two competitors – or world enemies – transparency holds the potential to give an advantage to one over the other. And so as long as the US healthcare delivery system remains positioned someplace between a market-based system and universal system the push for transparency is likely to continue facilitating unintended and undesired consequences.

Cheers,
  Sparky

 

Filed Under: Editorials & Opinions, Transparency · Tagged: , , , ,
Accepting the Realities of Aging
Apr 25, 2013

Accepting the Realities of Aging

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head-in-sand . . . or not.  The Associated Press-NORC Center for Public Affairs Research last week released the report, Perceptions, Experiences and Attitudes among Americans 40 or older. Sponsored by the SCAN Foundation, the report presents research based upon interviews of just over 1,000 individuals aged 40 and older regarding their views on aging.

From a public policy perspective, the key takeaway underscores a phenomenon common to discussion and debate over how to finance the future long-term care needs of an aging population. At a time in our lives when we are at our peak earning potential we typically also have the highest propensity to spend – quite often as a necessity of family survival. The past half-decade has heightened further that reality for many of us.

Of those interviewed, fully 30% would rather just not think about aging – while an additional 32% were only somewhat comfortable thinking about getting older. Not surprisingly, there was an apparent correlation between being more comfortable (I would posit, willing) to think about and discuss aging and the respondent’s age. Ailments and infirmities tend to be quite effective at breaking down one’s belief in mind over matter as a plausible substitute for the elusive fountain of youth.

In what I interpret as a perceptual vote of no confidence in government’s ability to effectively address the looming cost crisis attendant to long-term care, 51% of interviewees between the ages of 40 and 54 – and 48% between the ages of 55 and 64 – are a great deal or quite a bit concerned about affording the long-term care they may require as they age. This is compared to only 30% of those over the age of 65 (i.e., Medicare eligible) who share the same concern.

Whether that represents a false sense of security or not, it is worth noting the research also highlighted the continuing misperceptions that many individuals have regarding their probability of needing future long-term care, its costs, programs available to provide assistance and how to plan for future needs. For those directly involved in providing long-term care services and support those perceptions are accepted realities.  But for those in positions of public policy influence and responsibility the consequential understanding of those realities is a lot less clear.

Of course, I am thinking of the Commission on Long-Term Care, which pursuant to Section 643 of the Taxpayer Relief Act, is charged with developing, “a plan for the establishment, implementation, and financing of a comprehensive, coordinated, and high-quality system that ensures the availability of long-term services and supports for individuals in need of such services and supports, including elderly individuals, individuals with substantial cognitive or functional limitations, other individuals who require assistance to perform activities of daily living, and individuals desiring to plan for future long-term care needs.”"

There is widespread belief that a key element of any successful plan should include efforts to create greater awareness and education surrounding the individual realities of long-term care. The research shared above serves to underscore that belief. What is largely unknown, however, is whether such investments are worthwhile. We have so far seen the relatively disappointing results of investments in health and wellness (as an aside, I wonder whether Senator Harkin has seen that research).

Sometimes things that seem to be intuitively correct are disproved by empirical evidence. The failure of long-term care insurance to gain greater traction may be an indicator that education and awareness regarding the need to plan for long-term care will have a limited ability to overcome the strong human inclination to stay in the moment.

Since it is also true, however, that intuition often bears fruit only through successive efforts to overcome obstacles, I do believe education and awareness, along with wellness and prevention, should continue to be encouraged from a healthcare and long-term care public policy perspective.  In making those investments, however, programs with tighter feedback loops that help measure relative effectiveness are not only prudent but will help accelerate the desired outcomes of those investments.

Cheers,
  Sparky

Filed Under: Aging, Editorials & Opinions · Tagged: , , ,
Apr 4, 2013

The Rising Costs of Dementia Care

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Research published today in the New England Journal of Medicine – Monetary Costs of Dementia in the United States – describes the projected economic consequences of caring for an aging population afflicted with various forms of dementia, including Alzheimer’s disease.

Separating the caregiving related costs attributable to dementia is challenging, if not impossible, because of the prevalence of comorbidity in individuals having dementia and because of the lack of quantifiable data reflecting the financial burden associated with informal caregiving. Using data from the University of Michigan’s Health and Retirement Study, the study’s authors sought to adjust for such phenomena by parsing out data that is believed to reflect the marginal costs associated with dementia.

Their methodology looked at how these costs could vary over the spectrum of probability within a given population that an individual would be afflicted with dementia. Costs were stratified according to:
     Out of Pocket Spending
     Spending by Medicare
     Net Nursing Home Spending
     Formal and Informal Homecare

If the intuitive concern that the economic impact of an aging society will be dramatic, the aggregate cost projections from this research certainly reinforces that concern. With a prevalence rate of 14.7% of the US over the age of 70 having dementia, the current (2010) cost of care (not including the valuation of informal caregiving) is $109 billion. By 2040, if prevalence rates and utilization of non-informal services and care are held constant, that amount is projected to more than double.

The authors note that dementia is one of the most costliest diseases to society, yet 75% to 84% of attributable costs of dementia are related to institutional care (e.g., a nursing care facility) or home-based long-term care – i.e., as opposed to medical care. Healthcare providers in that space should recognize the challenges and opportunities of that consequence.

I think it is important to remember that the inherent subjectivity of the dataset – and the data elements represented – is a reality that cannot be overlooked. In addition, even if there wasn’t the inherent subjectivity, I’m not really sure of the article’s value, nor whether it is deserving of the attention received in the press. Perhaps there’s something there I missed.

Counting the number of teeth a shark has and noting their regenerative capabilities is a fascinating exercise, but it’s the shark that can kill you – not its teeth.

Cheers,
  Sparky

Special Note: last summer I shared with Pub visitors a webinar, Emerging Trends and Drivers in Dementia Care, presented by my Artower colleague, Lori Stevic-Rust, PhD ABPP, Board Certified Clinical Health Psychologist and nationally recognized authority on Alzheimer’s disease. Another plug here seems appropriate.

Filed Under: Alzheimer's/Dementia Care, In the News · Tagged: , , ,
Mar 31, 2013

Readmission Realities

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The topic of Hospital Readmissions has evolved into a primary point of discussion and debate within the nation’s lexicon of Healthcare Reform, most notably through broadly accessed media outlets not typically associated with in-depth reporting on medicine and healthcare. As often happens, by the time such a topic traverses the tipping point of being newsworthy it will have actually been around for quite a while in  smaller though certainly no less important academic circles.

As an example, Dr. Elliott Fisher and colleagues were sharing their research findings on hospital readmissions back in 1994 in the New England Journal of Medicine. Using Medicare claims data they studied discharge patterns in Boston and New Haven between October 1987 and September 1989. What they found was that, “hospital-specific readmission rates varied substantially …” and that “no relation was found between mortality (during the first 30 days after discharge or over the entire study period) and <sic> either community or hospital-specific readmission rates.”

In their conclusions they noted that, “regardless of the initial cause of admission, Medicare beneficiaries who were initially hospitalized in Boston had consistently higher rates of readmission than did Medicare beneficiaries hospitalized in New Haven. Differences in the severity of illness are unlikely to explain these findings. One possible explanation is a threshold effect of hospital-bed availability on decisions to admit patients.”

In other words, despite what is  understandably a popular media association, identification, concern and debate over whether and how reducing hospital readmissions represents a prudent means of lowering healthcare expenditures without impacting quality or outcomes is not a phenomenon borne of the Affordable Care Act. More importantly for my purpose here, understanding the history of hospital readmissions as a policy topic is to understand and accept the challenges associated with developing public policy intended to incent reductions.  And of course, the primary case in point here is Section 3025 of the Affordable Care Act, the Hospital Readmissions Reduction Program (HRRP).

I believe there is justifiable concern with the HRRP, particularly in the realm of unintended consequences. But I also believe those concerns have thus far tended to be self-serving and inflated when compared to the potential benefits. I addressed these points just about a year ago in the post, Is Focus on Hospital Readmissions Misguided? That was in reaction to another article published in NEJM, Thirty-Day Readmissions – Truth and Consequence. Now fast forward to an article published this past week in the NEJM, A Path Forward on Medicare Readmissions. Are you getting the sense that the hospital readmissions topic is nothing if not complex and contentious?

In this latest contribution to the subject, authors Drs. Karen Joynt and Ashish Jha identify two recent developments that provide insights into how HRRP implementation appears to be playing out.  The first was a MedPAC report evidencing a decrease in national rates of readmission for all causes, from 15.6% in 2009 to 15.3% in 2011. The second is an emerging recognition, based on CMS reports, that hospitals most susceptible to financial penalties under the HRRP are also those most likely to provide care for individuals with complex and/or expensive healthcare needs. In other words, this suggests that HRRP implementation has the potential to provide a financial disincentive leading to disparities in care availability.

Rather than chucking the HRRP as a policy failure, however, the authors suggest an approach that is quite admittedly conceptually foreign to a government characterized by intransigence and stubbornness: they suggest modifying the program in reaction to what is learned during implementation. Specifically, they first suggest adjusting readmission rates for socioeconomic status. Second, they suggest weighting the HRRP penalties according to the timing of the readmission to better recognize the potential causes of that readmission. And finally, they suggest an offsetting credit be given for comparatively lower mortality rates in recognition of hospitals – e.g., large teaching hospitals – where readmission rates are more likely to be an expected consequence of keeping their sickest patients alive.

The authors correctly point out that, “no policy is ever perfectly designed at inception, and policies should be changed as new evidence emerges.” At the same time, we should be cognizant where policies reach too far or are impractical in their design. For example, the UK’s National Health System (NHS) Medical Director, Bruce Keogh, announced this past Friday that hospitals there will face future reduction in fees for failing to follow the latest clinical guidance (i.e., quality standards).

In my thinking, there is both a philosophical as well as practical difference between policies that provide financial incentive through measuring health outcomes versus measuring the means and methods of achieving those outcomes. But if our aim is to develop a healthcare system that leverages the productivity and efficiency advantages of market-based solutions, while guarding against the market failures inherent to healthcare, we will need to be vigilant in avoiding the slippery slope of policy dysfunction.

Cheers,
  Sparky

Filed Under: Editorials & Opinions, Hospital Readmissions · Tagged: , ,
Mar 21, 2013

Medicine Storm Clouds

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Trying to connect the dots in healthcare delivery can be a lot like stringing beads in a windstorm: the time spent getting even a few in place often comes at the expense of losing track of many others. Over the past few days I came across three articles that feel like they should be strung together because they share an unintentional common theme: what will the practice of medicine look like in a decade from now as more and more medical knowledge is captured and made available in the cloud: the Medicine Cloud.

The cloud I refer to of course is a metaphorical description of electronic computing resources (i.e., data storage, hardware and software) that are accessed by users through web browsers and light-weight desktop and/or mobile applications. There are significant advantages to healthcare providers leveraging cloud-based computing, notably a significant reduction in upfront investment – both in terms of time and capital. Lower maintenance costs, improved reliability and the facilitation of greater data sharing that can enable more efficient integrated care delivery and provider interoperability are also big advantages.

The three articles I reference above include:

    Through a Scanner Darkly: Three Health Care Trends
    for 2013 written by Dr. David Shaywitz in the
    Healthcare Blog;

      Brain Awareness, by Dr. Thomas Insel, Director of the
     National Institute of Mental Health; and

      the third was an article shared by Dr. William Palmer
      in our HCPolicy online discussion group: Online
     learning: Campus 2.0 by M. Mitchell Waldrop in
     the March 13th edition of Nature Magazine.

From different perspectives each of these articles represent key trends and drivers likely to impact how Medicine is practiced in the future – and in particular, the impact information technology will have. And while there are reasons for optimism in how advancements in technology can lead to improved access, efficiency and productivity – information technology has so far not proven to be the panacea many practitioners had hoped for.

Sourcing, capturing and aggregating medical-based knowledge – and then making that knowledge readily available to clinicians (e.g., including physician extenders) can be incredibly enabling and empowering for both the clinician and the patient, particularly when it is made available in real time. But there are hugely challenging concerns and substantial public policy issues that I think we should be discussing.

For example, one major challenge – as shared by Dr. Shaywitz in his blog post – is finding balance between the current push toward practice standardization that information technology naturally enables and maintaining the valuable non-standardized realities of practitioner experience. Dr. Insel’s article succinctly explains just how far we are from understanding how the human brain functions. To the extent we come to view an electronic knowledgebase as replacing a trained and experienced clinical practitioner’s brain, I think we do so at great peril.

On the other hand, making more medical-based knowledge available at a lower cost (i.e., as shared in the Nature Magazine article) has the potential to address the looming challenge of primary care physician access. Indeed, knowledge is power, and we should never be afraid to pursue any opportunity that empowers more people with knowledge.

Of course, online courses cannot replace medical practicums, and we must not be led to believe that the accumulation of didactic knowledge can replace practice and experience. There are two ways to view this: as an obstacle that inhibits expansion of provider availability – especially the expansion of physician extenders – or as a reality that requires proactive planning to try and ensure practical alignment between provider capabilities and patient needs. And then we have to assess whether this is a phenomenon that should be addressed through public policy, and if so how.

Now throw into this mix the markedly different attitudes and perceptions of younger clinicians on the role information technology can (and should, in many of their minds) play in the future practice of medicine – and you have the makings of a public policy maelstrom. Even in the face of the recent recession, Gen Xers and Millennials still are looking at work-life balance as one of their primary concerns. While there is a lot to be said for the benefits to society in taking more time for the family and less for the fortune, I do fear the potential implications this can have if it precipitates an overreliance on the Medicine Cloud as a replacement for the Medicine Man/Woman.

Cheers,
  Sparky

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