HPM Final
Reference pricing expansion
CalPERS has expanded reference to inpatient procedures for cataract surgery, colonoscopy, arthroscopy Key consideration: 1. regional cost variation 2. volume & focus increase quality 3. can be scheduled 4. substantial cost
Goetzel
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How to control costs?
In short-run, move left on production curve (total outcome per incremental expenditure) ex. units of cleanliness, transport, analysis, early detection of breast cancer vs. units of housekeeping, automobiles, laptops, mammography
dual eligibles
comprise 20% of Medicare population and 15% of Medicaid population in 2008
Primary prevention
*Avert disease or injury* -avoiding disease: immunization, fluoridation, promoting health (e.g., smoking cessation) -not just clinical: addresses social, economic, and behavioral determinants of health, such as literacy & adequate housing/nutrition -can reduce population's risk of disease & potentially save medical costs
Second Epidemiological Revolution
*Behavioral Risk Factors for Chronic Diseases, diseases of "development"* targeting tobacco use, nutrition, etc. prevention: education, screening, drugs
Long-term quality federal policy
*Driving assumption*: measurement & reporting will change provider behavior in the intended direction -validate concept of measuring quality, access, cost, outcome at patient level -develop consensus measures related to research findings -create voluntary reporting/publishing--demonstrate feasibility -select some for use in reimbursement
The First Epidemiological "Revolution" (1880-1940)
*Infectious Diseases* -cholera & John Snow (medical hygiene) -causes: organisms, risk factors (living conditions, water source, etc.) -prevention: sewage disposal, milk pasteurization -nutrition/shelter/clothing continuously improving over the centuries in W. Europe and N. America after the 1400's -sanitation/water supply improvements, in W. Europe & N. America after 1870's impact infectious diseases, especially of childhood -shift in causes of death from infectious to generative and man-made illnesses in 20th century
Medicare vs. Medicaid
*Medicare*: for those age 65+ and younger adults with disabilities. eligibility tied to work history but not income or health status. Covers medical care, prescription drugs, and is primary source of medical insurance for dual eligible beneficiaries. Financial obligations can be steep for beneficiaries *Medicaid*: federal-state partnership with states operating program for low-income families, disabled, and elderly. eligibility tied to income, age, and disability, varies by state. Pays for Medicare premiums, cost-sharing, and other benefits. Primary payer for long-term care
Are hospitals factories?
*The Toyota production model*: LEAN -eliminate waste -respect for people who do the work -standardize work; current best way--reduce variation -get it right the first time: stop to fix immediately -constantly improve *Key assumptions*: -we can always do better -focus on patient value: willing to pay, transform, done right first time -identifiy & eliminate waste
Demand side levers
*cost sharing* -conventional cost sharing: consumer's "skin in the game", assumes they will be motivated to maintain health, seek better prices, etc. -value based: more elegent, incentivizes use of higher value services -reference pricing: based on 67th percentile of pricing, here's a list of facilities that price as such, gives payer choice
secondary care
*specialized problems, require special skills & clinical resources*
Current uses of quality measures for reimbursement
-30 day readmission -quality/safety penalties (VBP) -ACO quality standards -meaningful use standards for IT -MA Blue Cross Alternative Quality Contract -Geisinger's 90-day guarantee
IPA or PHO in a network model HMO
-HMO contracts w/IPA, hospitals, other providers (Rx, MH/SA, labs, etc.) -member joins HMO & selects PCP -->HMO allocate pmpm budget to IPA, member seeks specialty or inpatient care upon referral by PCP, HMO pays claims that satisfy referral -HMO-IPA management committee track/report on pmpm use/cost -HMO-IPA/PHO share risk for actual vs. pmpm budget
VMPS Case
-Kaplan -Starbuck's costs for back pain -frontline workers -MD compact
recent focus on harm reduction
-acceptance of the reality of harmful behaviors -design intervention or policies to minimize the negative consequences of behavior (needle exchange, safe injection site, opioid replacement therapy, Narcan distribution, e-cig) -similar attitude/situation toward STDs
Prevention
-aimed at reduing incidence of disease & disability, or slowing the progression & exacerbation of illnesses -much broader than medical care. includes individual, organizational, and societal actions can be cost-saving, cost-effective, or too costly
SNAP (Supplemental Nutrition Assistance Program)
-anti-hunge program based on income -part of Farm Bill -fed gov pays all of benefits & half of admin costs (share with state) -state manage -2012 max benefit: 1 person-->$200, family of 4-->$668
Cutler et al: Value of Medical Spending in US
-calculates an incremental spend of $19,900 per yr of life extended. -compared to other countries...?
Primary vs. secondary prevention
-can be fuzzy, depending on where we draw the line between disease and risk factors (e.g., obesity)
Reference pricing
-can combine supply and demand side -payer encourages providers to create integrated delivery system -enrollees get list of providers who accept the reference price -enrollees pay the balance if provider charges more than reference price *benefit deign element: similar to reverse deductible w/ insurance paying first part, and enrollee pays remainder--> price transparency ex. what make hip/knee procedure good candidate for reference based pricing? -variation in cost in markets, w/o dif in quality -procedures can be scheduled (elective, non-emergency) -preference sensitive -procedures performed in sufficient volume CalPERs experienced 20.2% decline in spending, even enrollees saved a small amount savings due to: 1) price reductions from higher cost facilities and 2) greater share of procedures being conducted at "value" priced facilities
brief history of addiction care
-cocaine, heroin, mj, opium all legal and widely used in 19th c -recognition of addiction in early 20th c -racial prejduce used as weapon to pass restrictive state laws -doctors and pharmacists used fear to gain legal monopolies -criminalization of a disease, including mandatory minimum sentencing -pendulum swings on use of pain killers: too much/too little/too much
Bodenheimer & care coordination
-communication among care givers and settings -PCP/NP for each enrollee -referrals to specialists and notes back to PCP -pre-admission authorization by PCP -discharge planning & follow up -case management for complex needs/services
Gawande & modern management
-comparing Cheesecake Factory and hospital -standardization/quality control to raising quality and shifting the curve -big medicine
Value-based insurance design (VBID)
-decr. cost sharing for medications of high clinical benefit relative to cost, and vice versa -*targets* use of higher rather than lower value services assumptions: 1. incr. use of high value treatments will prevent later complications 2. cost of preventing complications is less than/close to cost of treating them downstream (clinical risk in pop, effectiveness of service/design, cost of adverse events) 3. we can identify these high value treatments 4. enrollees will understand and respond to the design
Recent history of mental illness care
-effective medications began in the 1960s -de-institutionalization began in the late 1960s -much of care now provided in community settings -primary care recognition and treatment for depression, anxiety
Challenges in coordinating services for dual eligibles
-established as 2 distinct programs, by dif pieces of legislation -dif benefits, billing systems, enrollment, eligibility, appeals procedures, provider networks -state Medicaid programs have fewer incentives for coordination as most savings to toward federal Medicare programs -despite the importance of services Medicare and Medicaid cover, current system creates inefficiencies for dual eligibles
ACA mandated coverage for preventive services
-evidence based screenings & counseling -routine immunizations -childhood preventive services -preventive service for women * no requirement or assumption that all of these service are cost saving
ACA provisions dealing w/ dual eligibles
-experiments to achieve improved care coordination & save money -new policy office -expansion of part D subsidy for poor seniors -expanded funding for Medicare Advantage plans to enroll special needs population -MA a pioneer
ACA changes for mental health
-guaranteed issue for all diagnoses -behavioral health as essential benefit -improved drug coverage under Medicare PArt D -individual and employer mandates expected to decrease state costs -2014 Medicaid expansion (currently pays for about 28% of all mental health spending) and subsidies
challenges to measuring outcomes
-hard to define/measure -nobody collect patient-level, long-term outcome data -costs typically collected & reported around structures (e.g. inpatient acute care per day or per case (MI), not patients and episodes of care e.g., a year of weight, cholesterol, diabetes and hypertension management for an obese man of 70 after an MI -care involves shared resources; cost for each patient dificult to discern, but huge variation exists
behavioral health
-historically excluded from medical care, health insurance -separate and unequal systems -lower level of MD control (more law enforcement) -stigma & discrimination hinder access -failure to treat leads to other social costs
From de-institutionalization and stigma to common ailment and Rx therapy
-hospitalization down -grown in medications -shift from psychotherapy to medication management (counseling by non-MDs) -high incidence of MH and A in prison
Curative vs. preventive
-identify pathology vs. identify risk -restore health (return to the norm) vs. reduce risk (shift in the norm) -promote individual service ethic vs. respsonbility to the population -clinical intervention predominates vs. behavioral/social interventions are prominent, accompanied by clinical intervention
long-term care services
-includes health, housing, transportation, social -for persons with physical, mental, or cognitive limitations -sufficent to compromise independent living -12 million in U.S. need help with 1 or more ADLs or IADLs -moral hazard *Medicaid is the primary payer* 1. nursing homes 2. community based care 3. state/local "area offices on aging" such as day centers, supported housing, in-own home (PC nursing, help, food delivery, etc.)
Brief history of long-term care
-informal system/family support -Medicaid --> nursing homes -community based efforts more recent: retirement communities, assisted living, at-home services
addiction
-major cause of mortality -arises in adoescence, peaks in early adulthood -less than 10 percent get treatment
U.S. Preventive Services Task Force
-makes recommendations on clinical preventive services to primary care clinicians -->screening tests -->counseling -->preventive medications -recommendations apply to adults & children with no signs or symptoms -makes recommendations based on rigorous review of existing peer-reviewed evidence -->doesn't conduct research, but assesses the research -->evaluates benefits and harms of each services by age and sex
how does dual eligibility work?
-medicare is primary payer of medical services like Hospital, physician, diagnostic tests, drugs, etc -Medicare beneficiaries subject to many out-of-pocket costs -Medicaid picks up some of these for dual eligible -Medicaid pays for custodial care
are we living too long and too lame?
-men with functional disability rose -20% incr in survival rate for stroke, but many of the 6.8 million survivors suffer paralysis or inability to speak -Dr. Emanuel picking 75 as a good time to stop postponing death. What is gained in long life, beyond our prime?
MH (mental health) and SA (substance abuse)
-more likely to be poor and have lower level of education -much higher co-morbitities and medical care costs -people with serious illnesses report lower health status & die 25 years earlier
addiction and criminal justice system
-more than half of all crime involves alcohol or drugs -2/3 of all prisoners have addiction and/or severe mental illnesses -almost no quality treatment in prisons/jails -recidivism to substances and crime very high
Consequences of mismatch
-most consumers (and many providers) think of quality as the skill of "the great doctor" (e.g. Ben Carson's gifted hands" -consumers think cutting costs will necessarily cut quality, but there is a "sweet spot" where both can be improved -most experts & increasingly many practioners now believe that the key to quality is process improvement and systematic measurement
addiction care
-nonmedical approaches dominate treatment (Alcholics Anonymous) -effective behavioral treatments and medications slow to take hold (medications, cognitive-behavioral treatment) -different paths for different socioeconomic groups -racial disparities and criminal justice
When/how/where to die
-our new dilemma, perhaps one of our greatest -Atul Gawande "medical science...has created a new difficulty for mankind: how to die"
Painless vs. painful cost containment
-painless: spending less for same outcomes (only spend C, rather than D). Efficacy, eliminate waste.... painless for patients because doesn't affect their health -painful: "cost" to cost containment, spending less, but getting less outcomes. Trade-offs
National School Lunch Program
-per meal cash reimbursements to schools & agricultural commodities as supplements -meals have >1/3 of RDA for key nutrients, no more than 30% of calorie from fat, and less than 10% from saturated fat -administration lost key allies & history of bipartisan upport, plenty of controversy whenenver proposed change to roles
WIC (Women, Infants, Children)
-pregnant & lactating women and children up to age 5 y with other qualifications -federal grants to states -coupons for specific foods and $ equivalent for produce (~6-10 dollars per month), food include cereal, milk, eggs, peanutbutter -provides nutrition education, breastfeeding support, health care referrals
organizational structures that help coordinate care
-regionalization -multi-specialty group practice -community health centers -hierarchy like Kaiser
regulations aimed at children
-restriction by FTC on ad: but much of it is voluntary, large industry opposition -childhood obesity laws, 2011
Porter article on value
-says we should base healthcare on value for the patient, and if we do, everything else will fall in place -value important because it focuses on quality of outcomes, and not volume of services delivred. defined as outcomes relative to costs, so encompasses efficiency -value cuts across providers, and responsibility goes on all providers involved -Bundled payments fit because focuses on healthcare quality & puts responsibility on all providers -outcome hierarchies
Supply side levers
-seemingly painless cost control, possibility of enhancing value. But not painless for providers: 1. aggressive contracting 2. reduce salaries & MD capitation 3. reduce ALoS (average length of stay), start PT sooner for stroke victims 4. cut HMO's marketing budget 5. colonoscopies instead of chemotherapy for colon cancer
MA addiction reform legislation
-senate bill focuses on education -Governor's Task Force makes dozen of recommendations -legislation: physician & public education, MDs to check Rx Monitoring Program database, cap on initial painkiller Rx. of 7 days -eliminate "detox" stays at MCI-Framingham -Protect adm'tion of Narcan
Potential examples of value
-shorter MH stays decrease days/1000, while expediting care planning & w/o hurting outcomes -substitution of less expensive, equally effective generic for brand name drugs -arthroscopic in place of more invasive surgery -implantable cardiact difibrillators
Formal food protection
-started in early 1900s -19th c scandal: food adulteration--deliberate addition of inferior/cheaper material to pure food product to stretch supply & incr profit -incr awareness: Pure Food and Drug Act of 1906 -cosmetics added in 1930s analogous situations today: China and baby formula, U.S. dietary supplement, Flint MI lead
Atul Gawande on death and dying
-surveys say dying patients want prolonged life, being with family, mentally aware, dying at home, avoiding suffering -palliative care: reduce suffering, incr. mental awareness rather than focus on prolonging life -standard medical care: cure/prolong life, even at cost of short-term pain, disability, risk
Narcan
-used to reverse effect of opiates -minimal side effects -classified as a drug by the FDA -additional states regulations -becoming increasingly common for EMS, policy, DPHs -becoming increasingly expensive -still controversial
The ACA and quality
-value based payments -authorized Medicare and Medicaid demonstrations, linked ACO bonus to quality -established patient centered outcome research institute -create incentives & penalties for electronic record implementation & use -requires quality ratings/consumer satisfaction surveys for exchanges -requires exchanges to prominently display quality rating for each health plan offered
MH/SA parity
1. Mental Health Parity Act of 1996: required parity only in aggregate lifetime and annual dollar limits between the categories of benefits. did not extend to substance use disorder benefits 2. Mental Health Parity and Addiction Equity Act of 2008: any group heath plan that includes mental health and substance use disorder benefits must treat them equally in terms of out-of-pocket costs, benefit limits and practice such as prior authorization and utlization review concern: plans would drop mental health coverage
how to manage care?
1. create a spoke-and-hub "system" around PCP 2. norms for population-based care: primary/secondary prevention 3. pay for coordination: PCP management fees or capitation 4. measure & award performance 5. provide resource to engage patients (information and incentives, case managers)
Different ways to shift the curve & control costs
1. delivery & systems reform (supply side) 2. cost sharing and payment reform (demand) 3. rate regulation
types of VBID
1. design by service: eliminate co-pays on HTN medications 2. design by condition: eliminates copays on HTN medications for patients with diabetes 3. design by severity: eliminates copays for HTN meds for high-risk diabetics (>2 risk factors) 4. design by participation: eliminates copays for HTN meds for high risk diabetics if they adhere to disease management protocols
Agency for Health Research & Quality's conceptual framework
1. effective: overuse, underuse 2. safe: errors, misuse 3. timely: delays, ineffective 4. patient-centered: unresponsive 5. equitable: disparities 6. efficient: waste, delays, errors
Reasons cited for opposition to Narcan
1. encourages use (condoms, clean needles, HPV) 2. Provides false sense of security 3. focus on criminal justice efforts 4. economic
How to improve quality: 2 models
1. individual fault or liability: the individual clinician is at fault for a deficit of competency, attention, or care. So, hold the perpetrator accountable for his/her mistake 2. poor systems design: structure & processes of care are sub-optimally designed to prevent errors, and to promote effective, timely, patient-centered care. So, continuously improve structure & processes of care
approaches to cost-sharing
1. insurance-based: increases consumer's skin-in-the-game, assume they will be more motivated to maintain health, forego unnecessary care, and/or seek lower priced services 2. value based insurance design: distinguishes between less and more effective services; cost sharing increases use of higher value services
why dual eligibles?
1. most vulnerable population 2. high per capita expense 3. fastest growing, high need population --->more frail elderly --->rapid growth under 65 permanently disabled (population growth, boomers, incr. prevalence, women in workforce)
ACA Mandated National Quality Strategy
3 broad aims: better care, healthy people/healthy communities, affordable care 6 priorities: -reduce harm in delivery of care -patient-centered care -effective communication & coordination of care -effective prevention and treatment for leading cause of mortality, starting w/ cardiovascular disease -healthy living -affordable
example of care management
Global buget: $200 pmpm 50,000 members 50000 x 12 (months) x $200 = $120 million--> 50/50 risk-share with HMOs hospitals shares half (25%) and 100 MDs share other half (25%) 2015 results: HMOs spent $130mm on 50k members, which meant each doctor ended up owing $25,000 at year end
Third Epidemiological Revolution
Infectious diseases re-emerging (pandemically?) and diseases of aging Causes: new organisms, evolution of bacteria, travel, living longer prevention: source tracking, education, condoms, new antibiotic, immunizations
IADLs
Instrumental IADLs -housework/laundry -preparing meals -shopping for groceries -transportation -managing finances -taking meds/visits
CCA payment flow
Medicare/Medicaid --> SCO --> CCA --> CCA primary care providers, providers, hospitals/rehabs/nursing homes
hierarchical system
NHS population-based allocation of resources strives for efficiency and integration vs. unplanned dispersion of care in U.S.: choice without planned resource allocation & integration
Today's CCA
Prepaid Care System (HMO) -care teams, home visits, 24/7 access, care continuity, social worker, etc.
IPA (Independent Practice Association)
Tufts Health Plan, Harvard-Pilgrim Healthcare, HMO Blue PCP --> IPA of hospital & associated specialists --> HMO-contracted tertiary care hospitals & specialty vendors
Dr. Bach's commentary
What is an account-based high deductible health plan (HDHP)? Cost sharing with a high deductible, but it has an account linked to it, so whatever money you don't spend, you get to keep -intended to encourage consumers to shop around to get the best prices -problems he sees for value-based insurance design
Bodenheimer text definition of quality
access to: -competent clinicians -practicing w/o conflicts of interest -using scientifically sound info -in the appropriate setting -in an environment of continuous process improvement
ADL
activities of daily living: feeding, dressing, bathing/showering, getting to/from toilet, getting in/out of bed/chair, dealing with incontinence
Care management
aims to increase value by improving access, quality, use and/or price -right care, at the right time, in the right place -doing the most you can with your license -preventive/routine care from PCPs/nurses -patient engagement -same-day urgent care -ERs for true emergencies -day surgery and ambulatory care -community hospitals handle most serious acute care -tertiary care in AMCs -"step therapy" for Rx. drugs
Primary care
common problems, preventive care, require broad knowledge of patient 1. generalists: broad range of issue 2. point of patient' first contact 3. triage & coordinate care upon referral 4. longitudinal patient contact
conventional cost sharing
designed to work against moral hazard: deductible, simple, % coinsurance steer consumers away from higher costs, but not necessarily from less-effective care designed to decr. utilization generally, or of high-priced services/providers assumptions: 1. enrollees have alternatives, or, if not, can afford out-of-pocket spending 2. enrollees can and will act as informed, rational consumers, weighing costs against benefits effectiveness measured in short-term medical costs
Donabedian's model of quality measurement
each component has a direct influence on the next structure (facilities, equip, clinicians) --> process (what is done for and to the patient) --> outcomes (how patients health is affected
Secondary prevention
early detection to reverse or retard "disease" progression: -screening for presence of disease (e.g., mammography for breast cancer) -clinical Tx for patient at high risk of disease e.g., statins for high cholesterol -savings only if tightly targeted & low cost Tx -involves policy choices: reiumbursement, who does it and where, priority vs. other potentially effective screening
tort liability a poor model for quality improvement
goals: compensate victims & prevent negligence BUT: only 2% of the injured file claims, 40% of claimants don't involve true errors wasteful: 1/3 payments to go lawyers, contravenes known models of quality improvement
Value based purchasing design
had: -significantly lower general complication rate in 30 days -significantly lower 30-day general infection rate -similar follow-up admission rates -cumulative savings of $5.5M over 1st 2 years
challenge of VBID
implementation: targeting is very difficult and resource-intensive value is generally indication-based (e.g., value of cholesterol reducing meds depends on cholesterol reading and other risk factors) assumes availability of clinical data assumes improving access will increase utilization since the benefits of increaed use may be delayed, Rol depends on payer's time horizon
care coordination
integration of patient care activities between 2+ providers to facilitate appropriate delivery of healthcare services ex. Kaiser's open system where any provider can go in and edit a patient's medical record Bodenheimer's obstacles to coordinating care: overstressed primary care, interoperable computerized records, dysfunctional financing, lack of integrated systems of care
population-based prevention
intervenes across a community or broader group of people to avert, or retard the progression of, disease/injury --> does not impact only selected individuals --> may not even require individuals to act ex. 1. public health model (fluoridation, building sidewalks) 2. educational campaign (stop smoking mass ads) 3. labelling and regulation (nutritional labeling) 4. financial incentives (taxing tobacco)
individual prevention
intervenes person-by-person to avert, or retard, the progression of, pre-symptomatic disease/injury --> requires provider to target individual or individual to commit --> primarily benefits the individual/family, but can affect the herd ex. 1. medical model (routine teeth cleaning) 2. ID high-risk patients (screening patients for high cholesterol) 3. Counseling (family planning services, counseling patients) 4. clinical treatment (prescribing statins)
two sets of dual eligible
low-income seniors > 65, and people with disabilities < 65 -most qualify for Medicare and Medicaid separately
tertiary prevention
management of active disease in order to arrest its progression (e.g., dietary and drug treatment for diabetes)
recent efforts to integrate psych and medical care (esp. primary care)
one of primary objectives in PCMHs growing recongition of prevalence of co-morbidities in general, especially for cancer, heart disease, multi-chronic conditions
Value
outcome/cost *outcomes relative to cost* -efficacy & efficiency *outcome as numerator* -condition-specific, multi-dimensional (death, disability, QOL), individual or population based *cost as denominator* -cost for full cycle of a medical condition (including readmissions) -measured separately for multiple conditions -spend more on services to reduce need for others (e.g., maintenance Rx)
Commonwealth Care Alliance (CCA)
pioneering comprehensive care for the dual eligible population update: failure to control costs
Quality results from practice & good processes, even for highly skilled, discrete interventions
pre-surgical processes --> skills of the surgical team --> follow-up care
tertiary care
rare problems, complex interventions, highly resource-intensive
Bradley et al's argument that social supports improve health
states w/ higher ratio of social to health spending had significantly better subsequent health outcomes for 7 of 8 measures, e.g.: adult obesity, asthma, acute M.I. Relates to value...because all of this may miss pt of non-medical care's contribution to health outcomes
Reducing D2B time at Lourdes
streamlined emergency care for better outcomes
PPGP (Prepaid Group Practice)
such as Kaiser Permanente, Geisinger, InterMountain, the old Harvard community health plan in Boston -Kaiser: hierarchical system of care
PCMH (patient-centered medical home)
super PCPs try to compensate for lack of integrated system -patient centered -innovative models -payment reform