Ohio vs. Pennsylvania: Which State Got Medicaid Expansion Right?

Reading the announcements that Governor Corbett (PA) rejects the ACA Medicaid expansion on the same day that Governors Snyder (MI) and Kasich (OH) decide to expand Medicaid, I thought today was as good a time as any to take another look at this controversial issue.  On July 7, 2012 I wrote a long blog post that predicted many Republican governors would eventually agree to the expansion.  My reading of the tealeaves was that it was just too good a deal to pass up.  (http://kentbottles.blogspot.com/2012/07/scotus-ppaca-medicaid-expansion.html)

When Governor Corbett said in his budget speech that he would not add 500,000 Pennsylvania residents to Medicaid “simultaneous boos and cheers broke out among legislators.” (http://www.philly.com/philly/news/politics/state/20130206_Corbett_rejects_expansion_of_Medicaid.html)   The boos came from those who believed the Henry J. Kaiser Family Foundation prediction that by 2022 such an expansion would cost the state $2.8 billion while bringing in $37.8 billion in federal dollars. (http://www.kff.org/medicaid/8384.cfm)   The cheers came from Republicans who were afraid that the state would have to raise taxes when federal subsidies declined in the future.  In my opinion, Governor Corbett is making a mistake.  I am not alone in that assessment; I found a comment on a blog dated February 5, 2013 where SteveH wrote:

“I heard Gail Wilensky speak yesterday and she thinks most GOP governors will end up taking the expansion.  It should be a no-brainer but some GOP governors probably meet that criteria and will turn it down.” (http://theincidentaleconomist.com/wordpress/the-medicaid-expansion-is-a-really-great-deal/)

Governor Kasich’s support of Medicaid expansion in Ohio brings to six the number of GOP governors who have signed onto the program.  Because of his background as a guest host for Bill O’Reilly, an investment banker, Chairman of the House Budget Committee, and a well-respected deficit hawk, Kasich’s decision is important.   Opponents of state Medicaid expansion certainly were stunned and attacked him:

“Whatever justification Kasich may give, the actual explanation for his embrace of the Medicaid expansion is political cowardice. Chastened by his failed attempt at public sector union reform and Obama’s victory in the state, Kasich is up for reelection next year.  And he’s afraid to stand up to the inevitable onslaught of attacks from Democrats who would charge that he was refusing to accept free money to bring health care to poor Ohioans.” (http://washingtonexaminer.com/kasichs-cave-on-obamacare-shows-how-hard-it-is-to-beat-big-government/article/2520529?custom_click=rss)

Many observers believe that Kasich’s defection from the opponents of expansion will make it harder for other GOP governors to maintain this conservative position:

“Anti-ObamaCare groups have lost the argument with a few other red-state governors, but Kasich isn't just any red-state governor. He's been known as the most aggressive spending hawk this side of Scott Walker and Mitch Daniels, and the winner of the ‘Legislative Entrepreneur Award’ from the tea-party-affiliated FreedomWorks.”  (http://www.politico.com/story/2013/02/john-kasich-obamacares-biggest-red-state-catch-87143_Page2.html)  

Democratic analysts certainly think that the Kasich move is a game changer:

“Thus Kasich brings us closer to the day when those opposing the Medicaid expansion in their own states—notably southern governors like Perry and Jindal and Bryant and Bentley and Deal and Haley who are deliberately creating huge arbitrary gaps in health care coverage—are forced to stop hiding behind fiscal myths and just come out and admit they don’t want their citizens to benefit from Obamacare, full stop.” (http://www.washingtonmonthly.com/political-animal-a/2013_02/kasich_gives_away_the_game042802.php)

Kasich came out in favor of expansion only after he assembled a coalition of Obamacare supporters and opponents who all agreed that it represented sound economic policy. An Ohio Health Policy Institute study extending to 2022 concluded that covering 684,000 citizens would require $609 million in state dollars and bring in $5 billion in federal funds.  As I predicted in my July 2012 blog post, hospitals and physicians wanted the Medicaid expansion.  The Ohio Hospital Association estimates that hospitals spend $2.5 billion a year on uncompensated care.  The strategy was to have the coalition concentrate on educating the business community and state legislators that the expansion made sense economically and was too good to pass up. (http://www.washingtonpost.com/blogs/wonkblog/wp/2013/02/06/exclusive-how-ohios-republican-governor-sold-the-state-on-expanding-medicaid/)

The best short article on the pro side is titled “Why Opposition to  Medicaid Expansion is Nuts.” (http://www.bloomberg.com/news/2013-02-05/why-opposition-to-medicaid-expansion-is-nuts.html)  The best long winded academic argument for expansion can be found here. (http://jhppl.dukejournals.org/content/early/2012/10/09/03616878-1898839.full.pdf)  The best long argument against expansion, which did not convince me, is here (http://jhppl.dukejournals.org/content/early/2012/10/09/03616878-1898848.full.pdf)

Upon rereading my July 2012 blog, I am glad that I got most of it right immediately after the surprise Supreme Court decision that created the controversy in the first place. 

Should your review of doctors be taken seriously?

Recent articles highlight challenges with holding providers accountable for the care they deliver. One of the major thrusts of efforts to transform the American healthcare delivery system has been to become more patient-centered and to allow patients to provide feedback that matters.

Emblematic of this is the emphasis on patient involvement in the final rules for the Shared Savings Program accountable care organizations (ACO).

Echoing former Centers for Medicare & Medicaid Services Director Don Berwick's plea on the behalf of patients ("Nothing about us without us"), the ACO final rules emphasize patient engagement in governance, quality improvement and the individual doctor/patient interaction.

Follow the link for the rest of this blog

http://www.hospitalimpact.org/index.php/2013/01/30/is_patient_empowerment_the_next_step_for#disqus_thread

The Humanities vs. Science Question Revisited

Two of my favorite quotations are the 19^th century neurologist Jean Martin Charcot’s “Theory is good, but it doesn’t prevent things from existing” and Albert Einstein’s “In theory, theory and practice are the same. In practice, they are not.” 

These two statements summarize the tension between a medical science that thinks it can explain everything and my own experience that an alternative theory of the mind is needed.  I explore these issues in great detail in a five part essay titled Human Understanding, Randomness, Free Will, and Delusions found here http://www.thedoctorweighsin.com/human-understanding-randomness-free-will-and-delusion-part-i/, http://www.thedoctorweighsin.com/human-understanding-randomness-free-will-and-delusion-part-ii/, http://www.thedoctorweighsin.com/human-understanding-randomness-free-will-and-delusion-part-iii/, http://www.thedoctorweighsin.com/human-understanding-randomness-free-will-and-delusion-part-iv/, http://www.thedoctorweighsin.com/human-understanding-randomness-free-will-and-delusion-part-v/ and in a two part essay titled The Humanities vs. Science linked here http://www.thedoctorweighsin.com/the-humanities-vs-science-part-i/ and http://www.thedoctorweighsin.com/the-humanities-vs-science-part-ii/

I first started worrying about this controversy when I read Francis Crick’s Astonishing Hypothesis:

“You, your joys and sorrows, your memories and your ambitions, your sense of personal identity and free will, are in fact no more than the behavior of a vast assembly of nerve cells and their associated molecules.” 

This subject of humanities vs. the sciences was not on my mind last night when I settled in by the fire to read “Escape From Spiderhead,” the fourth short story in George Saunders’ new collection Tenth of December.  By the time I had finished this 37-page short story, I understood that Saunders had captured the essence of what is wrong with Nobelist Crick’s theory.

The main character Jeff is subjected to scientific experiments as part of his punishment for a violent crime; the investigators inject VerbaluceTM, VeriTalk TM, ChatEaseTM and ED556 in Jeff’s MobiPakTM and observe the results.  A few pages into the story, I realized we are in the future and the scientists are testing Crick’s Astonishing Hypothesis.  By manipulating Jeff’s “nerve cells and their associated molecules,” the investigators make Jeff fall passionately and physically in love with two other subjects, Heather and Rachel.  By changing the chemicals in the MobiPakTM they can make all of the subjects feel nothing for their former lover. 

In follow-up experiments, Jeff is devastated when Heather dies after Jeff is told to give her DarkenfloxxTM.  The head scientist tells Jeff:

“In science, we explore the unknown.  It was unknown what five minutes on DarkenfloxxTM would do to Heather. Now we know.  The other thing we know…is that you really, for sure, do not harbor any residual romantic feelings for Heather.  That’s a big deal, Jeff. A beacon of hope at a sad time for all… My guess is, ProtComm’s going to be like:  ‘Wow, Utica’s really leading the pack in terms of providing mind-blowing new data on ED289/290.’”

In a twist at the end, Jeff validating his humanity finds an unexpected way to refuse to participate in such experiments on human beings.

Saunders’ story gives me more reason to reject Crick and embrace Marilynne Robinson’s conclusion in her Dwight Harrington Terry Foundation Lectures on Religion in the Light of Science and Philosophy at Yale.  She believes that there is a mind separate from the brain, there are things unknowable in this world, and that the humanities can still teach me things that science cannot explain:

“As proof of the existence of mind we have only history and civilization, art, science, and philosophy. And at the same time, of course, that extraordinary individuation.”

           

The Downsides of Setting Professional & Personal Goals

http://www.hospitalimpact.org/index.php/2013/01/07/title_85

An Information Flaneur's Best Blog Posts of 2012

As a self described Information Flaneur who wanders aimlessly around the Internet and my world searching for what I don’t know that I don’t know, I did not expect to find any rhyme or reason to my 2012 blog posts.  And yet when I read them today on New Year’s Eve to select the Best of 2012, I surprised myself by finding six coherent and recurring overarching themes:

·      American physicians have lost their way and need to undergo intense self-scrutiny

·      American health plans need to reinvent themselves or disappear

·      The digital future of medicine is fascinating and largely unknowable

·      There is an urgent need to bridge the gap between the humanities and the sciences

·      The American preoccupation with Happiness is wrongheaded but extremely important

·      Understanding and explaining the Affordable Act takes a lot of time and energy, but it is worth it

American physicians have lost their way and need to undergo intense self-scrutiny

Some of my closest colleagues found it amusing that I of all people wrote passionately about the need for physicians to embrace humility and win the battle for the soul of American Medicine. “Early in life I had to choose between honest arrogance and hypocritical humility. I chose the former and have seen no reason to change” is a Frank Lloyd Wright quotation that I used ironically at the start of one of my diatribes calling for physicians to undergo intense self-scrutiny, and my closest friend said he thought Wright could be speaking for me.

http://www.thedoctorweighsin.com/physicians-humility-and-the-transformation-of-american-healthcare-2/

Nevertheless, there is a battle for the soul of American Medicine; I pontificated about it here http://thehealthcareblog.com/blog/2012/12/20/the-battle-for-the-souls-of-american-doctors/  and in a three part essay inspired by the English Olympics Opening Ceremony, which celebrated the National Health Service http://www.thedoctorweighsin.com/the-olympics-doctors-nhs-transformation-and-heroes-why-the-difference-between-usa-and-uk/, http://www.thedoctorweighsin.com/the-olympics-doctors-the-nhs-transformation-and-heroes-why-the-difference-between-the-usa-and-uk-part-ii/, http://www.thedoctorweighsin.com/the-olympics-doctors-the-nhs-transformation-and-heroes-why-the-difference-between-the-usa-and-uk-part-iii/   These blogs drew the wrath of many practicing physicians, as did my blog post that attributed much of any personal or professional success to luck http://www.thedoctorweighsin.com/does-luck-contribute-to-personal-success-2/.

American health plans need to reinvent themselves or disappear

The survival of Obama’s Affordable Care Act has demolished the traditional business model of the American health insurance company, and it has been fascinating to watch them scramble to reinvent themselves.  Some are buying bankrupt delivery systems and others are investing in providers and smartphone applications, but none of these tactics will work unless they can transform their corporate cultures.  Read about the challenges here http://thehealthcareblog.com/blog/2012/07/22/health-insurers-the-affordable-care-act-extinction-or-reinvention/, here http://www.thedoctorweighsin.com/health-plans-continue-to-struggle-to-reinvent-themselves/, and here http://kentbottles.blogspot.com/2012/03/technology-aetna-itriage-and-future-of.html.

The digital future of medicine is fascinating and largely unknowable

Like everyone else I read Eric Topol’s book and tried to keep track on Twitter of how digitizing a human being will revolutionize medicine.  I reviewed two books on digital medicine http://www.thedoctorweighsin.com/the-future-of-medicine-as-envisioned-by-topol-and-agus/, advised hospital executives to get with it http://www.hospitalimpact.org/index.php/2012/03/06/p4009#more4009, and wrote a summary of an iMedicine conference organized by medical students http://kentbottles.blogspot.com/2012/04/imedicine-influence-of-social-media-on.html.

There is an urgent need to bridge the gap between the humanities and science

Two of my favorite quotations are the 19^th century neurologist Jean Martin Charcot’s “Theory is good, but it doesn’t prevent things from existing” and Albert Einstein’s “In theory, theory and practice are the same. In practice, they are not.”  These two statements summarize the tension between a medical science that thinks it can explain everything and my own experience that an alternative theory of the mind is needed.  I explore these issues in great detail in a five part essay titled Human Understanding, Randomness, Free Will, and Delusions found here http://www.thedoctorweighsin.com/human-understanding-randomness-free-will-and-delusion-part-i/, http://www.thedoctorweighsin.com/human-understanding-randomness-free-will-and-delusion-part-ii/, http://www.thedoctorweighsin.com/human-understanding-randomness-free-will-and-delusion-part-iii/, http://www.thedoctorweighsin.com/human-understanding-randomness-free-will-and-delusion-part-iv/, http://www.thedoctorweighsin.com/human-understanding-randomness-free-will-and-delusion-part-v/ and in a two part essay titled The Humanities vs. Science linked here http://www.thedoctorweighsin.com/the-humanities-vs-science-part-i/ and http://www.thedoctorweighsin.com/the-humanities-vs-science-part-ii/

Siri Hustvedt’s elegant book review of Oliver Sacks’ new book Hallucinations convinces me I need to read more of Sacks and re-read some of Hustvedt’s novels to make better sense of this complex subject. (http://www.nytimes.com/2012/12/30/books/review/hallucinations-by-oliver-sacks.html)

The American preoccupation with Happiness is wrongheaded but extremely important

Even though I have read at last count 19 books on happiness, I am always a little bit skeptical about the whole enterprise.  I do find it fascinating that bronze medal winners are happier than silver medal winners and that winning the lottery often results in misery, but there is something wrongheaded about pursuing happiness as a goal.  Viewing Stefan Sagmeister’s The Happy Show at an art museum at the University of Pennsylvania inspired me to write a four part blog post on happiness: http://www.thedoctorweighsin.com/musings-on-stefan-sagmeisters-the-happy-show/, http://www.thedoctorweighsin.com/musings-on-stefan-sagmeister-the-happy-show-part-ii/, http://www.thedoctorweighsin.com/musings-on-stefan-sagmeister-the-happy-show-part-iii/, http://kentbottles.blogspot.com/2012/05/musings-on-stefan-sagmeister-happy-show_21.html.

My skepticism about the whole subject made me write The Downsides of Trying Too Hard to Be Happy, which can be found here http://www.thedoctorweighsin.com/the-downsides-of-trying-too-hard-to-be-happy-part-i/ and http://www.thedoctorweighsin.com/the-downsides-of-trying-too-hard-to-be-happy-part-ii/. I just finished reading a new book by Oliver Burkeman titled The Antidote:  Happiness for People Who Can’t Stand Positive Thinking, which has reinforced and brought focus to my skepticism.  I recommend it highly.

Understanding and explaining the Affordable Act takes a lot of time and energy, but it is worth

I spent much of 2012 running around the country giving keynotes, retreats, and seminars on the Affordable Care Act.  I also enjoyed teaching another graduate class at the Thomas Jefferson School of Population Health on health policy and the structure of the American delivery system.  My best blogs on this subject were on the demise of fee for service payments http://healthworkscollective.com/kent-bottles/70536/fee-service-really-dead, the Supreme Court decision upholding the individual mandate http://kentbottles.blogspot.com/2012/06/why-did-chief-justice-roberts-do-it.html, and the Medicaid expansion controversy http://www.thedoctorweighsin.com/the-scotus-the-ppaca-the-medicaid-expansion-decision/.

At the end of 2012 I was asked to predict what health care journalists should cover in 2013.  My essay can be read here http://www.reportingonhealth.org/2012/11/15/kent-bottles-new-ideas-covering-health-care-2013.  However, I must warn you that a far better way to understand health care in 2013 is to wander around twitter, read books and newspapers, and go to conferences in fields other than medicine.  Join me in becoming an information flaneur. 

The Battle for the Souls of American Doctors

We physicians like to think that we are really different from other workers.  We physicians, perhaps thinking back to that medical school application essay we all wrote, really believe that we went into this career to simply help others.  We physicians truly believe that we always put our patients first. 

Because we sincerely believe all of the above, we are shocked when someone like Uwe Reinhardt points out that collectively we act just like any other worker in the economy.  The classic 1986 letters between the Princeton professor Reinhardt and former New England Journal of Medicine editor Arnold Relman highlight the tension between how we think of ourselves and how we act.

Relman thinks physicians are special and he asks Reinhardt the following question:

“Do you really see no difference between physicians and hospitals on the one hand, and ‘purveyors of other goods and services,’ on the other?”

Reinhardt is ready with a long answer that should be read in its entirety.  The short answer is that doctors act like any other human beings.   A portion of his answer includes the following:

“Surely you will agree that it has been one of American medicine’s more hallowed tenets that piece-rate compensation is the sine qua non of high quality medical care.  Think about this tenet, We have here a profession that openly professes that its members are unlikely to do their best unless they are rewarded in cold cash for every little ministration rendered their patients.  If an economist made that assertion, one might write it off as one more of that profession’s kooky beliefs.  But physicians are saying it.” (http://content.healthaffairs.org/content/5/2/5.full.pdf+html)

I have recently written about the inevitable transition from fee for service payment to global, value-based payment systems, and I was surprised when a primary care physician whom I admire tweeted that he thought the end of fee for service would be the end of primary care.  (http://thehealthcareblog.com/blog/2012/12/12/is-fee-for-service-really-dead-really/)

This tension between the ideal of medicine and the economic reality of how medicine is practiced in the United States is perhaps best summarized by Atul Gawande in his famous New Yorker article about McAllen, Texas:

“Here, along the banks of the Rio Grande, in the Square Dance Capital of the World, a medical community has come to treat patients the way subprime-mortgage lenders treated home buyers: as profit centers." (http://www.newyorker.com/reporting/2009/06/01/090601fa_fact_gawande)

This morning I was reminded of this battle for the soul of American medicine when I read two articles in the New York Times.   On the front page an article titled “Quiet Doctor, Lavish Insider:  A Parallel Life” describes how a well-respected neurologist at the University of Michigan capped off his successful academic career by cooperating with federal prosecutors to avoid charges in a Wall Street insider stock trading scandal. 

“The riddle for Dr. Gilman’s longtime friends and colleagues is why a nationally respected neurologist was pulled into the high-rolling life of a consultant to financiers and how he, by his own admission, crossed the line into criminal behavior.”  (http://www.nytimes.com/2012/12/16/business/sidney-gilmans-shift-led-to-insider-trading-case.html?ref=health)

The other article in the Times published on the same day was the obituary of Dr. William F. House who invented the cochlear implant. 

“Neither the institute nor Dr. House made any money on the implant. He never sought a patent on any of his inventions, he said, because he did not want to restrict other researchers. A nephew, Dr. John House, the current president of the House institute, said his uncle had made the deal to license it to the 3M Company not for profit but simply to get it built by a reputable manufacturer.

Reflecting on his business decisions in his memoir, Dr. House acknowledged, ‘I might be a little richer today.’” (http://www.nytimes.com/2012/12/16/health/dr-william-f-house-inventor-of-cochlear-implant-dies.html?_r=0)

A major challenge for 21^st century American medicine is to cultivate the culture epitomized by Dr. House and avoid the mistakes of Dr. Gilman.

Is Fee-For-Service Really Dead?

The 21^st century challenge for the American health care delivery system is to deliver higher quality care for less money.   Republican and Democratic experts agree that payment reform involving transitioning from fee-for-service to global, value-based systems is necessary for us to achieve that goal.  Accountable care organizations (ACOs) are the new entities that will receive the new global payments and distribute them to the doctors, allied health professionals, hospitals, and post-acute care facilities that care for the patients; Medicare ACOs are being piloted under provisions in the Affordable Care Act (ACA) and Commercial ACOs are being developed by private insurance companies, hospitals, and physician groups. 

The ideal payment system would support the ideal value-driven health care delivery system.  Distinguished expert panels convened by the Commonwealth Fund and the Institute of Medicine have described the attributes of a system that would be far superior to our current delivery system:

·      Care would be patient-centered

·      Care would be safe and effective

·      Care would be timely and accessible

·      Care would be efficient with little waste

·      Care would be coordinated among providers and across facilities

·      Continuity of care and care relationships would be facilitated

·      Collaboration among providers would deliver high quality, low cost care

·      Patients’ clinical information would be efficiently exchanged

·      Caregivers would engage patients in ways that would maximize health

·      Accountability for each aspect and for total care would be clear

·      Continuous innovation, learning, and improvement would occur

                           (http://www.minnesotamedicine.com/tabid/3679/Default.aspx)

Although fee-for-service does not have all of the above ideal attributes, it does have a long history of paying for medical care.  Atul Gawande’s fascinating description of how he negotiated for his first salary as an attending surgeon at Harvard includes a brief history of fee-for-service medicine.  He starts with eighteenth century BC Babylon where surgeons got ten shekels for lifesaving operations on citizens and two shekels for the same operation on slaves and ends up with the standardized fee schedule that was developed in the 1980s to replace the “usual, customary, and reasonable fees” that insurance companies did not always find reasonable.  Gawande’s article is a good place to start understanding the strengths and weaknesses of this a la carte approach to paying doctors with its 600 page master fee schedule that lists what 24 different insurers pay for different services that Harvard physicians bill (http://www.newyorker.com/archive/2005/04/04/050404fa_fact).

Fee-for-service has lasted so long because it does have some advantages.  Conceptually, it is easy to understand because each procedure, service, intervention, or medical device is billed and paid for separately.  Fee-for-service encourages the delivery of care, is flexible enough to work with different sizes and types of physician practices, different types of care such as office visit, operation, procedure, or therapy session, and different sites of care such as office, skilled nursing facility, nursing home, hospital, or out-patient surgery center.  Fee-for-service supports accountability for each separate portion of care, but it falls down in supporting accountability for total clinical care provided by many different providers. (http://www.minnesotamedicine.com/tabid/3679/Default.aspx)

While the concept of fee-for-service is relatively straightforward, the reality can be quite confusing for both patients and providers.  Fee-for-service payments are constrained by CPT and ICD-9 rules that establish what can and cannot be billed for.  Unlike normal consumer markets, the list price for a service is hard to pin down because the amount paid is negotiated between different insurers and providers.  When a health reporter was told by her physician to obtain an expensive MRI to work up her migraine headaches, she experienced frustration trying to establish just how much the test would cost  (http://www.kaiserhealthnews.org/Stories/2012/December/09/mri-cost-price-comparison-health-insurance.aspx).  Her local hospital could not tell her how much it would cost; an academic medical center quoted her a price of $5,315 for an uninsured patient, but could not tell her what the price would be to her insurance company; an independent imaging center told her that the price would be $2,000 to $3,600 for an uninsured patient and about $600 to $1,200 for an insured patient.  She finally got the scan at her local hospital and was surprised to get a bill for $7,468. 

Fee-for-service also makes coordination of care across multiple providers and different settings difficult.  Since the payments are limited to one provider performing one service, this arrangement leads to hospitalized patients receiving different bills from the surgeon, the anesthesiologist, the pathologist, the infectious disease consultant, the radiologist, and the respiratory therapist.

The biggest problem with fee-for-service payments is that it results in overutilization and unnecessary care.  Dr. Gawande’s New Yorker article about McAllen, Texas explained the problem of medical overuse so clearly that President Obama had members of the Senate and the House of Representatives read it during the debate over the Affordable Care Act.  One cardiac surgeon in McAllen said, “Medicine has become a pig trough here.  We took a wrong turn when doctors stopped being doctors and became businessmen.”

“Compared with patients in El Paso and nationwide, patients in McAllen got more of pretty much everything – more diagnostic testing, more hospital treatment, more surgery, more homecare.”  (http://www.newyorker.com/reporting/2009/06/01/090601fa_fact_gawande?currentPage=all)

Health care policy experts on both the left and the right agree that ending the fee-for-service payment system will be necessary to control health care costs.  The New England Journal of Medicine recently published back-to-back articles with how the two approaches would bend the health care cost curve.  The Republicans responded with the following proposals:

•Medicare premium support replaces defined benefit to be used to purchase insurance

•Convert tax subsidy for employer insurance to predetermined refundable credit

•Transition from fee for service to bundled payments

•High option plan for Medicare

•Regional Medicare plans to encourage greater entrepreneurship

•Health insurance exchanges without “heavy regulation imposed by ACA” (http://www.nejm.org/doi/full/10.1056/NEJMsb1207996)

Not surprisingly, the Democratic health policy wonks came up with a slightly different list of solutions:

•Model of state self-regulation with spending targets where public & private payers negotiate payment rates with providers

•Replace fee-for-service with bundled and global payments

•Medicare competitive bidding for medical devices, lab tests, X-rays, etc

•Insurers should offer tiered plans with lower copays if patient chooses high value providers

•Payers & providers electronically exchange eligibility, claims, etc

•Single-standardized physician credentialing

•Price transparency

•Non physician providers should practice to full extent of their training

•Stark Law extended to prohibit physician self referrals for services paid by private payers

•FEHBP transition to new payment models

•Safe harbor against malpractice if physician uses HIT & EBM guidelines

•Shifting costs to patients & cuts to provider payments are not good ways to cut costs (http://www.nejm.org/doi/full/10.1056/NEJMsb1205901)

Replacing fee-for-service payments with global, value-based payment methods is the one proposed solution that both liberal and conservative health policy experts agree on.  Ken Kizer, MD spoke for most health care policy experts when he stated at a recent American Society of Clinical Oncology meeting, “Payment reform is inevitable.  Fee for service is dead.”  (http://thehealthcareblog.com/blog/2012/12/10/acos-we’re-not-there-y/#more-55492)  Health care experts are attracted to payment reform because of the estimated $200 to $600 billion savings over ten years (http://capsules.kaiserhealthnews.org/index.php/2012/12/report-payment-reform-leaves-docs-uneasy/).

Practicing physicians have not shown the same level of enthusiasm for the elimination of fee-for-service.

“A survey of doctors by Harris Interactive finds that 59 percent of physicians believe that the fee-for-service system encourages them to provide ‘an appropriate level of care.’ Only 15 percent disagreed. Although 37 percent of doctors thought such a system encourages the use of more care or expensive care, 38 percent also said that a fee-for-service system encourages coordination of care. Not surprisingly, the 400 U.S.-based primary care physicians and 600 U.S.-based specialists surveyed, did not favor the idea of a global capitation payment—or a fixed payment per month for all medical services. Nearly 60 percent of the doctors surveyed said that capitation put too much risk on the provider.”

(http://capsules.kaiserhealthnews.org/index.php/2012/12/report-payment-reform-leaves-docs-uneasy/)

Another problem for health care leaders is managing the transition from fee-for-service to global, value-based payment systems.  Dr. Don Berwick, former head of CMS, describes the transition problem facing leaders who are still paid mostly by fee-for-service arrangements:

They've got one foot on the dock and one foot on the boat and they're drifting apart. One foot is fee-for-service, revenue-driven, grow the volume, do more and more, which is the dock, and the boat is, let's focus on what patients really need and decrease unnecessary care and the liability or harmable (sic) unnecessary care. (http://www.healthleadersmedia.com/content/QUA-287211/QA-Don-Berwick-Reflects-on-Healthcare-Reform-Part-I )

Steve Blumberg has described four types of health care leaders when it comes to dealing with the transition away from fee-for-service:

·      Leaders who are acquiring the necessary tools and shifting the culture to deal with new payment systems.

·      Leaders who understand the problem intellectually but have not embraced any solution.

·      Leaders who are just waiting and hoping the problem goes away.

·      Leaders who are trying to get their organizations acquired by others so they don’t have to deal with the problem.

(http://thehealthcareblog.com/blog/2012/12/10/acos-we’re-not-there-y/#more-55492)

Blumberg’s observations are spot on and match my impressions from talking with health care leaders from all over the country.  I have met executives who belong in each of the four groups, and the smallest number in my experience resides in the proactive first category.

I recently read with interest two reports out of California, which support the uneven preparation of health care to get ready for accountable care organizations that are not paid by fee-for-service.  In San Francisco providers appear to fall into all four categories (http://www.chcf.org/publications/2012/12/regional-market-san-francisco). In Fresno, California physicians appear content to remain in fee-for-service arrangements and appear to land squarely in the third category of waiting and not preparing to respond to federal health care reform. (http://www.chcf.org/~/media/MEDIA%20LIBRARY%20Files/PDF/A/PDF%20AlmanacRegMktBriefFresno12.pdf) 

This gap between the health policy experts and practicing physicians and local health care leaders is worrisome.  Even if Accountable Care Organizations paid by global, value-based payments are inevitable and the best possible solution to the unsustainable cost of American medicine, the reform enterprise will fail or flounder without an enormous cultural change by all the participants in this complicated and important endeavor.