The Users' Guide to the Health Reform Galaxy

From a doctor's point of view: making billing better, for better care

James E. Bailey, M.D., M.P.H., is a practicing internal medicine physician, director of the Healthy Memphis Data Center and a professor of medicine at the University of Tennessee Health Science Center.  In this post, he riffs on a topic covered by a recent RWJF-supported study, about how streamlining billing procedures will increase efficiency and help improve the quality and cost of health care.

Between the recession and new health reform law, Americans have been thinking a lot about what health care costs. I’ve heard many stories of patients and their families suffering because of the cost of getting care. I also know many primary care doctors and hospitals that do their best to provide everyone the care they need most are finding it difficult to keep their doors open. Again and again, I’ve seen how the health care people receive is often of poor quality, despite its high, and rising, cost. Sadly, Americans end up getting expensive, sometimes even dangerous procedures they don’t need while their most essential health care needs are overlooked.

The health reform debate tended to focus on big, divisive issues—and rightly so. Real change in our health care system will require hard choices to be made by everyone. But there is another big issue—not quite as divisive but nonetheless worth our attention—which is the system’s misuse of time.  Any physician can speak of large amounts of time—and frustration—spent dealing with administrative issues such as billing. As a doctor, I want most to spend my time with my patients. And so every minute I spend on administrative tasks is one less minute I have for seeing patients. And instead of an efficient system that empowers doctors to best do their work, we’ve created a time hog that dictates the priorities of our practices, inhibiting us from doing what we are called to do as physicians—provide care for those who need it.

This is why reform efforts must address issues like the simplification of billing and paperwork. A new study from RWJF's Changes in Health Care Financing and Organization initiative, “Saving Billion of Dollars—And Physicians’ Time—By Streamlining Billing Practices” suggests that it is possible to streamline the billing process, increase the quality of care and eliminate some unnecessary costs. The study examines the U.S. system of billing third-party payers for health care services, arguing that the system of third-party payment is excessively cumbersome, complicated and costly. We spend about twice as much on the billing bureaucracy in America than in any other country in the world.  While it is unlikely that we will be able to eliminate third-party middlemen from the system any time in the near future, there is much that can be done now.

Health Reformer's Lexicon: Bundled Payments

The Health Reformer's Lexicon is a weekly feature that will examine key words, terms and phrases in health reform and explore their meaning and orbit.

The term: Bundled payments

The RAND Corporation defines bundled payments—also known as “episode-base payments”—as “a single payment for all services related to a specific treatment or condition … possibly spanning multiple providers in multiple settings. Providers would assume financial risk for the cost of services for a particular treatment or condition as well as costs associated with preventable complications.”

The Robert Wood Johnson Foundation and George Washington University’s Health Reform GPS project adds: “In contrast to fee-for-service payments, which can encourage a high volume of treatment, ‘bundling’ is thought to encourage more cost-effective care.”

(Bundling payments first requires categorizing different types of medical cases. These categories are known as diagnosis-related groups, or DRGs, which Medicare uses to bundle reimbursements to hospitals for inpatient care.)

Why it matters: A root cause of many of the U.S. health care system’s most profound problems—including soaring costs and uneven quality—is the fee-for-service payment system, which encourages overuse of health care services and fails to reward value. Among the alternative options, bundled payment schemes are attractive because they give hospitals and physicians incentives to coordinate care and to provide it more efficiently. Tied to evidence-based medical practice, bundling also promises to increase the value of our health care system—producing better outcomes for patients—in a fair and equitable way.

Roots: Physicians at the Texas Heart Institute introduced bundled payments in 1984 for cardiovascular surgical procedures. A 1987 study found that the Health Care Finance Administration could decrease its costs by more than $192 million (13 percent) under Texas’ payment plan. Since then, as U.S. health care expenditures have ballooned, health reformers have continued to advance the idea of bundling as a way to reform the fee-for-service payment system. The Balanced Budget Act of 1997 established new payment systems for most types of post–acute care services; independent initiatives such as PROMETHEUS Payment have worked on the practical design and implementation of evidence-informed case rates; and President Obama championed bundling in the recent health care reform debate.

Where the term appears: The final health reform bill calls for the creation of a national Medicare pilot program by the beginning of 2013, which will develop and evaluate bundled payment systems for acute inpatient hospital services, physician services, outpatient hospital services and post–acute care services for episodes of care that begin three days prior to hospitalizations and last an additional 30 days following discharge.
 
Under the new law, the government must also set up Medicaid pilot projects by 2012 that will use bundled payments to pay for episodes of care that include hospitalizations.

The Centers for Medicare & Medicaid Services is already experimenting with bundled payments through its Acute Care Episode demonstration, with sites in Texas, Oklahoma, Colorado and New Mexico.

And recently, several major health care providers in California announced plans to use bundled payments to pay for hip and knee replacements beginning in August. The lump-sum fee will cover a full range of medical treatments from surgery to 90 days of recovery.
 
Previous Lexicon entries include:
- Flexible Spending Accounts
- Value-Based Purchasing
- High-Risk Pools

Health Reformer's Lexicon: Value-Based Purchasing … and the latest from Health Wonk Review and Grand Rounds

The Health Reformer's Lexicon is a regular feature that examines key words, terms and phrases in health reform and explores their meaning and orbit.

Today’s term: Value-based purchasing.

According to the Agency for Healthcare Research and Quality, “the term basically refers to any purchasing practices aimed at improving the value of health care services, where value is a function of both quality and cost.” AHRQ continues: “It can be helpful to think about value as the result of quality divided by cost: Value = Quality ÷ Cost. This equation shows that value increases as quality increases, holding expenditure constant.”

The term is commonly associated with specific reforms such as pay-for-performance and discrete initiatives aimed at improving outcomes for a single disease or fraction of the population. But many health care experts argue value-based purchasing must be construed more broadly if it is to be an instrument of systemic reform. For example, the Urban Institute’s Robert Berenson and New America Foundation’s Len Nichols, writing in the Health Affairs blog, offer this definition: “Value-based purchasing uses a variety of tools to try to obtain the right kind and mix of services, of desired quality, at a reasonable cost.”

Why it matters: Susan DeVore, the CEO of the Premier healthcare alliance, has put it this way: “Cutting costs while improving care is the Holy Grail of health care reform.” And in the search for that Holy Grail, many health care policy experts believe value-based purchasing will be a critical tool.

Our current health care system, structured as it is around a fee-for-service model of reimbursement, rewards doctors and hospitals for the volume of services they provide, not the value of the care they deliver for patients or populations. This causes a host of problems, not least of which is overuse of health care services.  In the long run, health care reform can only be successful if the system rewards providers for giving patients the right care at the right time in the right way.

Roots: The concept of value-based purchasing has been gaining currency since the late 1990s as health care researchers and stakeholders have been systematically examining the design, implementation and outcomes of new purchasing strategies to replace fee-for-service.

Where the term appears: The newly enacted health care reform law establishes a hospital value-based purchasing program in Medicare to pay hospitals based on their performance on certain quality measures. The new law also calls for plans to be developed to implement similar value-based purchasing programs for skilled nursing facilities, home health agencies and ambulatory surgical centers.

Previous Lexicon entries include:
- Individual Mandate
- Uncompensated Care
- Flexible Spending Accounts

Meanwhile, in other news …

In this week’s Health Wonk Review on the HealthBlawg, David Harlow mentions our recent post on the definition of uncompensated care, joking that “Titanic doesn't even begin to capture the immenseness of the galaxy” when it comes to this topic. Also, the latest edition of Grand Rounds highlights Catherine Hess’ recent post on children’s health insurance coverage.

Health Reformer's Lexicon: Uncompensated Care

The Health Reformer's Lexicon is a weekly feature that will examine key words, terms and phrases in health reform and explore their meaning and orbit.

The Term: Uncompensated care

Researchers from the Urban Institute define it as “medical care that is either freely donated by providers or results in an unpaid bill.”

The American Hospital Association defines it in more exacting detail as “the sum of a hospital’s ‘bad debt’ and the charity care it provides.” AHA elaborates:

In terms of accounting, bad debt consists of services for which hospitals anticipated but did not receive payment. Charity care, in contrast, consists of services for which hospitals neither received, nor expected to receive, payment because they had determined the patient’s inability to pay. In practice, however, hospitals have difficulty in distinguishing bad debt from charity care.

Why It Matters: In most cases, uncompensated care is provided to people without insurance. One estimate pegged the amount of uncompensated care given to uninsured people in America at more than $50 billion a year. Government underwrites more than $40 billion of it through Medicare and Medicaid Disproportionate Share Hospital (DSH) payments and other means.

Health-policy experts have argued that failing to enact reform would have led to greater levels of uncompensated care, perhaps even double the amount. Conversely, analysts have estimated that by insuring tens of millions more people, reform will dramatically decrease uncompensated care—and thus provide substantial spending offsets for federal and state governments.

Indeed, the final reform bill signed by President Obama reduces Medicare DSH payments by 75 percent and then begins adjusting them based on the percentage of the population uninsured and the amount of uncompensated care provided. Medicaid DSH payments are set to be reduced, too.

Roots: It is difficult to pinpoint precisely when the term “uncompensated care” was coined, but a January 1974 article in the American Society of Law & Medicine’s Medicolegal News hints at its origins:

When the Hospital Construction and Survey Act of 1946, more popularly known as the Hill-Burton Act, was passed by Congress, facilities receiving federal funding were required to assure that they would provide a “reasonable volume of services to persona unable to pay therefor.” The general legislative intent was that this would help provide access to medical care to a segment of the population that had hitherto been denied care or had been reluctant to seek it because of lack of financial resources…

As became increasingly apparent throughout the next two and one-half decades, many hospitals treated the statutory mandate to deliver uncompensated services as mere surplusage. If they were required to account at all for the volume of uncompensated care provided, they simply wrote off their bad debts for the year as Hill-Burton qualifying services…

Where the Term Appears: An expected drop in uncompensated care is factored into the final health reform law in the form of the aforementioned cuts to Medicare and Medicaid DSH payments. The term—and the dollar figures associated with it—also continue to appear in post-game analyses and debates about the costs, benefits and fallout of enacting reform.

Previous Lexicon entries include:
- Meaningful Use
- Patient Centered Medical Home
- Individual Mandate

New County Health Rankings Highlight Opportunities for Quality Improvement

Lisa Letourneau, executive director of Quality Counts, considers the implications of a new series of reports on county-by-county health variations.

No matter how healthy a community is, there is always room for improvement. For proof, just look at the County Health Rankings released recently by the Robert Wood Johnson Foundation and the University of Wisconsin’s Population Health Institute.

At first glance, the report on my home state of Maine in many ways confirms what health reformers have long understood: health follows wealth. With a few exceptions, the more affluent counties on the comparatively urbanized, southern coast of our state have better overall health profiles than the less-affluent counties in the densely wooded, rural parts of the state. For example, in Lincoln County, a coastal community in the mid-coast area, 9% of the population reports itself to be in “poor” or “fair” health. By comparison, that is a relatively low level and puts the county in the 90th percentile of results overall. But in Aroostook County, all the way at the rural north end of the state, the figure is 18%, twice the target level.

Health Reformer's Lexicon: Accountable Care Organization

The Health Reformer’s Lexicon is supposed to be a weekly feature that will examine key words, terms and phrases in health reform and explore their meaning and orbit.  But what can I say?  Snowstorms, and other developments, all can get in the way. 

The term: Accountable care organization (ACOs)

In a recent policy brief that examines the ACO concept, Urban Institute researchers Robert Berenson, M.D., and Kelly Devers, Ph.D., provide the following definition:

 A local health care organization and a related set of providers (at a minimum, primary care physicians, specialists, and hospitals) that can be held accountable for the cost and quality of care delivered to a defined population.

Why it matters: As Berenson and Devers note,
 
Proposing a new entity with the word “accountable” in its title begs the question of who is becoming more responsible for what, when it comes to delivering high-quality and efficient health care.

Policy makers are looking at ACOs as they search for ways to deliver well-coordinated care that produces positive outcomes while also slowing the rise in health care costs.

Roots: The term ACOs emerged publicly in a 2006 Health Affairs article where a footnote traces its etymology as follows:

The idea of using the term ‘accountable care organizations’ … grew out of an exchange between Elliott Fisher and Glenn Hackbarth at a Medicare Payment Advisory Commission meeting in November 2006.” (Fisher leads the Dartmouth Atlas Project, Hackbarth is the chair of MedPAC.)

Usage: The more fully refined ACO concept appeared nearly three years later, and a similar concept –“accountable care systems”– was explored in JAMA. 

But the references that may matter most at this point are the ones found in health reform legislation.

The Senate Finance Committee’s bill would:

Allow providers organized as accountable care organizations that voluntarily meet quality thresholds to share in the cost-savings they achieve for the Medicare program. To qualify as an ACO, organizations must agree to be accountable for the overall care of their Medicare beneficiaries, have adequate participation of primary care physicians and specialists, define processes to promote evidence-based medicine, report on quality and costs measure, and coordinate care.

 

How Maine Used Its Clout to Press for Higher-Value Health Care

Bruce Siegel, director of the Robert Wood Johnson Foundation’s Aligning Forces for Quality initiative and the RWJF legacy program, Expecting Success: Excellence in Cardiac Care, recounts how a big health care purchaser applied its considerable leverage to insist on public reports about hospital performance. This post is part of our continuing effort to shine a light on local laboratories of health care reform.

What does a heavyweight look like in the fight for high-value health care? Take a look at how the state of Maine has used its muscle as the administrator of health plans for 34,000 employees, retirees and their families. It is an especially noteworthy story since the health care reform bills before Congress include a number of provisions to encourage the use of quality measures and value-based purchasing.
 
Maine’s State Employee Health Commission, responding to a call from the state legislature to contain health care expenses, developed a new health-benefits plan in 2006. No ordinary plan, its goals included engaging employees and retirees in the health care process, improving quality of care and encouraging providers to publicly report their performance information.

The upshot has been a value-based purchasing strategy based on public reports developed by the employer-led Maine Health Management Coalition, which works closely with the Robert Wood Johnson Foundation’s Aligning Forces for Quality grantee, Quality Counts, and the state government’s quality-improvement initiative, called the Maine Quality Forum.

Teaming Up to Improve Care of Diabetes Patients in Minnesota

As Congress and the president figure out their next steps on national health care reform, we want to continue shining a light on local laboratories of reform. Here, Bruce Siegel, director of the Robert Wood Johnson Foundation’s Aligning Forces for Quality initiative and the RWJF legacy program, Expecting Success: Excellence in Cardiac Care, writes about the effort to encourage high-performing health care providers in the Land of 10,000 Lakes.

Quality reformers have a mantra: You can’t improve what you don’t measure. But in Minnesota, the local team that the Robert Wood Johnson Foundation tapped to manage its Aligning Forces for Quality initiative, also knows you can’t lose weight by just standing on the scale. You have to act on what you learn.

The Foundation’s grantee, Minnesota Community Measurement, operates the scale. Its HealthScores project gathers performance data from Minnesota health plans as well as 300 medical clinics statewide. But it is part of a multi-pronged action team that is driving change in Minnesota by helping providers improve on their performance and then rewarding them when they do.

I'm dreaming of a white paper ...

David C. Colby, vice president of research and evaluation at the Robert Wood Johnson Foundation, shares his favorite health reform policy papers in the spirit of regifting.

While many of you might already have visions of sugar plums dancing through your heads, I (not surprisingly) have health reform on my mind.  That doesn’t mean I am not in the holiday spirit. In fact, I propose a “white elephant” holiday gift exchange here at the foundation. ‘Tis the season of regifting.  The best part of the gift exchange is how it highlights that value is truly in the eye of the beholder.  Many recycled gifts are still perfect gifts.

In that spirit, I want to regift to you some of this year’s health reform policy papers that are as good as stocking stuffers today as when they were released last February, April, June or October. I started with 12 gifts of policy analysis, but with Hanukkah wrapping up tomorrow, feel free to pick your favorite eight…

America’s Uninsured Crisis
Released in February by the Institute of Medicine (IOM), this report addresses three key questions: (1) What are the dynamics driving downward trends in health insurance coverage? (2) Is being uninsured harmful to the health of children and adults? (3) Are insured people affected by high rates of uninsurance in their communities?

Crossing Our Lines: Working Together to Reform the U.S. Health System
In June, three wise men, former Senate Majority Leaders Howard Baker, Tom Daschle and Bob Dole completed The Leaders’ Project on the State of American Health Care, a two-year consensus-building process resulting in a plan for reforming America’s health care system.  This report outlines their key recommendations.

How Do We Pay For Health Reform?
Conducted by Urban Institute researchers and released in July, this analysis reports that savings from many popular health reform ideas would finance the lion’s share of the cost of comprehensive health care reform. The authors also conclude that a combination of revenue options would provide more than enough money to fill the gap between the cost of reform and the savings resulting from it.

How Does the Quality of U.S. Health Care Compare Internationally?
This analysis from the Urban Institute, which we released in August, looks at the evidence on how quality of care in the United States compares to that in other countries and highlights the implications for health reform.

How Will the Uninsured Be Affected by Health Reform?
In this four-part series, released in August by RWJF and the Kaiser Commission on Medicaid and the Uninsured, the Urban Institute’s Lisa Dubay and Allison Cook calculate how many uninsured people could gain coverage through a health reform scenario that draws on proposals being discussed on Capitol Hill.

Bending the Curve
Released in September, this report is not about making candy canes. Compiled by the Engelberg Center for Health Care Reform at the Brookings Institution, the paper proposes that health care reform should include comprehensive efforts to achieve higher-value care. The report was co-signed by a distinguished group of scholars and policymakers: Joseph Antos, Ph.D., (American Enterprise Institute for Public Policy Research); John Bertko (Brookings Institution); Michael Chernew, Ph.D., (Harvard Medical School); David Cutler, Ph.D., (Harvard University); Dana Goldman, Ph.D., (RAND Corporation); Mark McClellan, M.D., Ph.D., (The Brookings Institution); Elizabeth McGlynn, Ph.D., (RAND Corporation); Mark Pauly, Ph.D., ( University of Pennsylvania); Leonard Schaeffer (University of Southern California); and Stephen Shortell, Ph.D., (University of California, Berkeley).

Is Massachusetts Reform Working for Doctors?
This study, published in the Oct. 21 issue of the New England Journal of Medicine, finds that 70% of practicing physicians in Massachusetts support health reform three years after its passage in 2006. We partnered with Blue Cross Blue Shield of Massachusetts Foundation to fund the research, which was designed and conducted by researchers at the Harvard School of Public Health.

Trust for America’s Health Prevention Poll
The poll, conducted for RWJF and Trust for America’s Health by Greenberg Quinlan Rosner Research and Public Opinion Strategies, indicates the majority of Americans support disease prevention investments as a part of national health reform. Poll findings were released in November.

A State Policymaker's Guide to Federal Health Reform
These three documents released by the National Academy for State Health Policy (NASHP) last month identify the most challenging health policy issues that states are addressing; describe the tools they have at their disposal and how federal health reform may affect those tools. It also describes the support they would need to implement federal health reform legislation.

County and City Health Departments: The Need for Sustainable Funding and the Potential Effect of Health Care Reform on their Operations
This report, released earlier this month by Health Management Associates, analyzes the effects that substantial funding cutbacks from local, state, and federal sources have had on already-strapped local health departments.

Leveling the Field - Ensuring Equity Through National Health Care Reform
Bruce Siegel, M.D., and Lea Nolan, M.A., from the Center for Health Care Quality, The George Washington University School of Public Health and Health Services, published this piece in the Dec 3 edition of the New England Journal of Medicine. The paper discusses how health reform legislation would reduce racial and ethnic disparities by extending coverage to disadvantaged groups.

The Cost of Failure to Enact Health Reform: Implications for States
Released at the end of September, researchers from the Urban Institute used their Health Insurance Policy Simulation Model to estimate how coverage and cost trends would change in every state between now and 2019 if the health system is not reformed.

Wishing you a happy and healthy holiday season. May all your policy papers be white!

Finding the sweet spot between affordability and access in health reform

Bowen Garrett, a senior research associate at the Urban Institute, writes about finding the sweet spot between making health care more affordable for low- and middle-income families while limiting overall costs.

As legislators continue to hammer out details on key provisions of health reform legislation, they face a difficult balancing act. To craft a successful health reform bill, they must limit the overall cost of the reform package, while at the same time, making health insurance affordable for low- and middle-income families. That’s no small feat for even the most nimble-footed of policymakers. 

A key component in finding the right balance is where to set levels of premium and cost-sharing subsidies.  These subsidy levels will go a long way toward determining how affordable insurance coverage and access to medical care would be for families under reform.  If the levels are wrong, the cost burden will be too high for low- to moderate-income families driving down compliance with an individual mandate. The resulting lack of widespread compliance would ultimately make it very difficult to maintain insurance reforms on the table because at their core, they depend on broad risk pools.

Health reform could hurt minority groups if not done right

Bruce Siegel, director of the Robert Wood Johnson Foundation’s Aligning Forces for Quality initiative and the RWJF legacy program, Expecting Success: Excellence in Cardiac Care, writes that equity should be an important component of health reform.

Health care reform could actually hurt minority groups unless Congress makes some fixes. Without an explicit focus on equity, reform could leave millions of these Americans behind.

The goal of the reform bills in the House and Senate is to dramatically expand access to coverage, including for minority groups, which are traditionally under-insured. But the bills also envision measuring doctors’ and hospitals’ results and paying them based on how well they perform. And while that is a laudable goal, it could also hurt minority groups if not done right. If, for instance, we start measuring and penalizing hospitals depending on how many patients need to be admitted again, hospitals could have incentives to turn away the poorest and sickest patients; who tend to also be people of color. And safety net hospitals that underperform, already overburdened and underfunded, would be further deprived of resources.

The issue looms large given that racial and ethnic minority groups will be in the majority in the U.S by 2050. They already account for half the uninsured, are poorer in health, suffer more disease and are more likely to get inferior care. There are also equity implications in the transformation taking place in provider reimbursement as the notion gains ground that we need to systematically and rigorously examine how well our doctors and hospitals perform and pay them accordingly.  Especially important, in the interest of attaining quality care for all patients, is measuring how well the system treats minority groups.

Performance Measurement and Public Reporting Are Driving Tangible Quality Improvements in Minnesota

Jim Chase, president of MN Community Measurement, argues that results from six years of measurement and public reporting in Minnesota and other regions have boosted quality, with clear implications for national health care reform. This post is part of our continuing effort to shine a light on local laboratories of health care reform.

Last year, doctors at the HealthEast Care System in St. Paul noticed something interesting: After starting to meet monthly to focus on the dozen health care quality measures that MN Community Measurement reports publicly each year, they found they were among only a handful of Minnesota medical groups to get above-average grades on at least half the measures.

The annual measurement report “demonstrated that we could achieve better outcomes for our patients -- because others were doing it,” said Linda Walling, medical director for clinical informatics at the 14 HealthEast clinics. “Our clinicians want the best for their patients and this appealed to their competitive nature.”

That first step, it's a doozy

It’s tough times for those of us in the blogosphere who are focused on health reform.  After all the frenzied activity this year so far, we’re now in the position of wondering what deals are being cut behind closed doors as the Senate debates its version of a bill.  Oh, you still hear the occasional hand-wringing about whether [INSERT PREFERRED VERSION OF BILL] will cover enough people, do enough to control health care spending, or, if you want to believe the extremists, end up funding amoral behaviors, but for the most part, we’re all waiting to see if a signed bill will be in our stockings, or not. 

I have two innate characteristics that tend to war with each other over things like health reform legislation—one, I’m a rules-driven person, and I believe in process to the extent that it allows for fairness and for a range of perspectives to inform the debate, but two, I’m also naturally impatient, and I hate process when it is subject to numerous wrangling and gaming attempts until it no longer looks like a process anymore, it just looks like...a bureaucracy.  So part of me wants to find value in this hurry-up-and-wait period that Congress and the Administration have been engaged in all year, with respect to health reform legislation, but part of me wants to say, let’s just get this part over with, already, and move on to the next part.

Some of my impatience, I think, comes from what I learned in law school (on top of learning that I didn’t, actually, want to practice law), and it’s this:  the law, or rather, the compilation of statutes and legislative acts and regulations that we understand to be the law, is a really blunt instrument for change.  No matter how many pages of legislation you pass, legislation alone will not change the behaviors and practices that have led us to our current health care woes.

'Cost of Dying' on 60 Minutes looks at human and financial toll of system

It's worth taking a look at “The Cost of Dying,” which aired Nov. 22 on CBS News’ 60 Minutes and explores the extraordinary amount of money spent on medical care at the very end of people’s lives.

In 2008, Medicare paid $50 billion for doctor and hospital bills during the last two months of patients' lives – with as much as 20 to 30 percent deemed to have had no meaningful impact, Steve Kroft reported.

Dr. Elliot Fisher of Dartmouth Institute for Health Policy and Clinical Practice noted that as many as one-fifth of Americans end up dying costly deaths in intensive-care units because "it's the path of least resistance" - the easiest way for doctors to manage them.

But the report is at its most powerful tackling the human costs of such a system.

Families cannot imagine there could be anything worse than their loved one dying," said Dr. Ira Byock, who heads the palliative care program at Dartmouth-Hitchcock Medical Center (DHMC) in Lebanon, NH. "But in fact, there are things worse. Most generally, it's having someone you love die badly-dying, suffering, dying connected to machines."

Recommended reading, on top of all that other reading

There's been an interesting debate brewing about costs and efficiency in health care.  Here's the latest salvo from Jack Wennberg and Shannon Brownlee, published on the Health Affairs blog.  As Jack points out, it's not that people can really object to the Dartmouth Atlas data, per se (although some certainly do keep on trying to poke holes in the research itself), it's more that they object to what actions can possibly happen in an effort to address unwarranted variations in cost and quality of health care.  It would be interesting to keep track of all the controversies that have cropped up during this national health reform discussion and someday point out which fears came true and which ones didn't.  I guess it's impossible to try and re-shape an industry that makes up so much of our country's economy without kicking a few hornets' nests along the way.

What health reform looks like in the real world, right now

Susan DeVore, the CEO of the Premier healthcare alliance, writes about the lessons health reformers can learn from its efforts to drive quality improvement and costs savings in hospitals.

A year ago, 157 hospitals in the Premier healthcare alliance set out to see if they could deliver better care to save lives, while simultaneously saving money.

As it turns out, they can. And there is a lesson from this effort for Congress as it struggles to find practical solutions to improve health care quality and control spending. Cutting costs while improving care is the holy grail of healthcare reform. If we can bend the curve of healthcare costs, we stop the system from careening toward insolvency and make coverage more affordable.

Premier, an alliance of 2,200 not for profit hospitals, created QUEST (for “Quality, Efficiency, Safety and Transparency), in partnership with the Institute for Healthcare Improvement, to find ways to holistically improve healthcare. To participate, hospitals joining the collaborative agreed to transparently share data and results with one another; adopt tough measures; and then observe and implement new ways of providing care to enhance quality.

This wasn’t some academic study. We pulled performance statistics on deaths, costs and effective care. We then figured out what is driving deaths, errors and excessive costs, devising the best ways to prevent them and setting aggressive improvement goals. After just one year, we estimate QUEST saved 8,043 lives, or 14 percent fewer deaths than expected. At the same time, hospitals also saved $577 million, or $343 per patient discharge.

Where were you?

Mike Painter, senior program officer at RWJF, writes about the latest report released by RWJF on the adoption of electronic medical records.  He contributed a chapter in the report on quality measurement and how it relates to health information technology.

I distinctly remember the first time I heard the title, “National Coordinator for Health Information Technology”.  It was 2004.  That’s, of course, the year that RAND released its important national report card highlighting the overall mediocre state of health care quality.  You know the one that told us “it’s a flip of a coin.”  I was an RWJF Health Policy Fellow working on the Hill with then Majority Leader Bill Frist’s health policy staff.  There was a flurry of staff activity regarding the president’s pending executive order pushing adoption of the electronic health record and creating a new federal health information technology, dare I say, czar. . . . But what to call this new position?  To be honest, when I initially heard folks say the words, “national coordinator for health information technology,” my first thought was, “Well, that’s a mouthful.”  My second was “It sort of sounds like a character from that TV show, ‘The Love Boat’”.  But I kept those smart remarks to myself and quite quickly got on board—and, to be honest, never looked back. 

At RWJF in 2005, several of us worked with then National Coordinator, Dr. David Brailer, on a partnership effort between the Office of the National Coordinator and RWJF.  With this project we extended a grant to Dr. David Blumenthal, then in Boston, to create a series of national reports that would track the national adoption of the electronic health record over several years as the nation progressed toward wider and wider adoption.  This week we’re issuing our third report in that series. 

Of course, the news is sobering.  This third report highlights yet again that overall adoption of the electronic record is stubbornly, almost shockingly, low in virtually all clinical settings.  This current report also highlights that without focused attention, adoption of electronic health records might make disparities even worse.  Terrific. 

Talking about health care quality on the Hill

Anne Weiss, Team Director for Quality/Equality at RWJF, writes about a recent series of visits that took place in DC.

Earlier this week, I found myself walking the marble hallways of Capitol Hill, right at ground zero for health reform as the House and Senate were preparing final bills for vote.  RWJF’s Aligning Forces for Quality (AF4Q) grantees were visiting with their Congressional delegations on Capitol Hill, and I got to come along for the ride.  (For those who just came in, AF4Q is the Foundation’s signature effort to improve health care quality in 15 communities around the country.  You can learn more about AF4Q here) 

I’m not talking here about a casual “hey, I was in the neighborhood, so I thought I’d drop in and say hi” kind of visit, either.  Just imagine what it might take to nail appointments for 15 grantee teams with two Senators and at least one Representative for EACH team during a typically frantic 48 hours on the Hill.  Then factor in that we were there during a week when the national debate over health care reform was positively deafening (and so were the demonstrators on every corner, especially the guy who threatened eternal damnation for supporters or opponents of the public option, I forget which).  This formidable undertaking took months to plan and prepare for, so we were lucky to have all the support we needed from RWJF’s Project Connect, a project that helps RWJF grantees build relationships with their members of Congress and other policy-makers.  The Connect support is invaluable for lots of reasons, but two especially:  one, they know how to help grantees make the most of a few precious moments with very busy legislators and two, they kept us all safely on the right side of legal rules that prohibit RWJF grantees from lobbying.  Thanks to Project Connect, all 15 grantee teams arrived in Washington on Monday morning having thought about what they wanted to get out of the meetings, how to tell their stories effectively, and prepared to make their pitch in a hallway or on an elevator if required.

Are accountable care organizations the answer to our problems?

Kelly Devers and Bob Berenson of the Urban Institute write about the latest policy brief by Urban and RWJF, which focuses on the concept of creating more accountable entities in health care.
 
In the often contentious health reform discussions, ideas that are good in theory often gain quick currency, but deserve closer examination as to whether they might actually work.  One such idea is the accountable care organization (ACOs).  Accountable care organization are entities—and we’ll clarify what we mean by “entities” in a second—that are intended to address one of the conundrums of our current health care system:  how to pay providers for high-quality, efficient care.  Under our current fee-for-service payment system, we end up paying for volume, not quality or value, that is better quality for the money we spend. In addition, many of the ways we deliver health care, especially for common chronic conditions like diabetes or heart disease, have become increasingly fragmented and cumbersome for both the provider and the patient.
 
To address these interrelated problems of provider payment and delivery, many health care leaders and experts have become increasingly interested in ACOs as a way to bend the cost curve, i.e., deliver higher-quality care to more people without contributing to our escalating health care tab.  ACOs are commonly understood to be local entities comprised of clinicians—primary care and specialty physicians, hospitals—that are responsible for delivering quality care and controlling health care costs in ways that current providers are not. 
 
However, the concept of what ACOs are and how they might work is still murky.  Therefore, in a new policy paper out today from the Urban Institute and the Robert Wood Johnson Foundation, we try to go to uncharted territory, and wrestle the ACO concept into the real world. 

The secrets of Massachusetts' success (including bigger carrots and smaller sticks)

Robert Restuccia, Executive Director of Community Catalyst, writes about the less-talked-about lessons from Massachusetts-style health reform.

Massachusetts as model – it’s a common claim in health policy circles. With the lowest rate of uninsured residents in the nation – just 2.7 percent – it’s clear to those watching that Massachusetts’s mix of Medicaid expansions, sliding scale subsidies, private insurance reforms and individual mandate are working to expand coverage and have served as the template for national reform. 

But there are other, less obvious lessons from the Massachusetts experience that have not really filtered into the political and policy discourse in Washington.  Here are a few of the most important.

There are good policy and political reasons for putting coverage expansions ahead of cost containment

Massachusetts made the strategic decision to tackle health coverage before cost containment – making it easier to keep all players at the table.  Despite bold words to the contrary at the start of the process, the Congressional leadership and the Obama Administration too are finding it hard to arrive at a consensus on significant cost containment while still keeping the industry backers of coverage expansion at the table.  But Massachusetts is using the pressure from the cost of its coverage expansion to jump-start a more serious debate about cost containment than ever before.

Faster is better

The current health reform is not the first time Massachusetts attempted to enact a near-universal coverage program.  In the late 1980s under Governor and soon-to-be Presidential candidate Michael Dukakis, Massachusetts enacted a major health reform proposal with an employer “pay or play” as its central element along with a number of other smaller programs.  Today those smaller programs, implemented almost immediately after reform passed, are still going strong, while the employer pay or play, which was not scheduled to go into effect for several years after passage, was first delayed and then repealed as the political and economic environment shifted.

What Congress Can Do To Boost Health Care Quality

Margaret E. O’Kane, president of the National Committee for Quality Assurance (NCQA), an independent, non-profit organization whose mission is to improve the quality of health care, writes about NCQA’s new report, The State of Health Care Quality 2009. You can also read an interview with O’Kane here.

Just as the health care reform process is speeding up, NCQA has found that progress on important measures of health care quality has slowed down. After 12 years of steady and often remarkable progress in performance, the report we released today documented relatively little improvement in most areas of care during the past year by the nation’s health plans. These findings underscore why provisions to improve quality must be part of any health reform package.

Because reform will most certainly bring more individuals into Medicare and Medicaid programs, it was especially disconcerting to see that for the third year in a row, we found that performance of health plans serving these public programs failed to improve on key quality measures. In fact, Medicare Advantage plans made statistically significant improvements on only five of 36 measures (14 percent). The results for Medicaid plans were somewhat better, but still there was a statistically significant gain on only 18 of 50 measures (36 percent), and most of these were small. Results in the commercial plan sector were slightly better, with improvement on 22 of 51 measures (43 percent).

Bills would boost quality by shining a light inside the health-care system

Debra Ness, co-chairman of the Consumer Purchaser Disclosure Project (CPDP) and president of the National Partnership for Women & Families, writes about provisions to improve health care quality in pending legislation.

And now there are five. With its vote this week, the Senate Finance Committee reported out the final of five reform bills that hold the potential to transform our broken health care system.

It has been a long road getting here. The National Partnership, for one, has worked for 15 years with a wide range of consumer and patient groups to shine a light on the need for improving the quality of health care, getting costs under control and expanding affordable coverage.

I’m encouraged because the Finance Committee bill builds on the momentum we’ve seen over the past several months to make some sorely needed improvements to our health care system – things that will help Jane Citizen and her family get the care they need. Chief among them are key insurance market reforms that take great strides towards protecting Americans’ health coverage — making it illegal for insurance companies to raise rates based on a pre-existing condition or gender, denying coverage based on health status, and dropping people who get sick.

The long and winding road to reform

Peter V. Lee, co-chairman of the Consumer Purchaser Disclosure Project (CPDP) and executive director for national policy of the Pacific Business Group on Health, writes about provisions to improve the quality of health care in pending reform legislation.

We’re seeing important movement on health care reform front, as the Senate Finance Committee moves its version of a bill to now be part of the debate. Whether or not we manage to get one bill that everyone can agree on, there’s no doubt that some have found the long wrangle in Congress over health reform depressing. But call me an incurable optimist—after looking at all of the different versions of the bills floating around, I’ve taken heart in the fact that while none of the bills are perfect, they all contain good provisions that could help improve the quality of health care and make care more affordable.

For instance, there is very good language in each of the three proposals – in the Senate Health, Education, Labor and Pensions Committee, Senate Finance and House "Tri-Committee" – on measuring and reporting quality. They call for setting national priorities with processes that engage consumers, employers and other stakeholders; make sure the patient’s perspective is at the center of measurement efforts; and require more information on how patients fare. The proposals also focus on comparative-effectiveness research so patients, doctors and insurance-purchasers know which treatments really works.

CBO's scoring window: why it matters

Michael J. O’Grady, PhD, a senior fellow at the National Opinion Research Center at the University of Chicago, writes about the Congressional Budget Office and how it scores proposals.  The CBO recently issued a price tag for the Senate Finance bill on health reform that is being voted on right now.

The current debate our country is having about overhauling our health care has highlighted the sometimes challenging interaction between the worlds of budget policy and health policy.  One such interaction is the issue of scoring windows.  The Congressional Budget Office (CBO), the official scorekeeper of reform proposals, typically projects spending for a 10-year period.  However, on September 14, Senator Kent Conrad (D-ND), Chairman of the Senate Budget Committee, requested that CBO provide a twenty—year estimate of the Senate Finance Committee bill.  He was right to do so, and here’s why.

First, let’s talk about why CBO moved from the original 5-year window to the current 10-year window.  The shift occurred for a number of reasons.  The Budget Committees began looking at a longer time horizon.   In the FY 1994 Budget Resolution Congress established a 10-year budget “point of order” in the Senate.  Then in 1995, Speaker Gingrich introduced a seven year balanced budget plan, adding further momentum to estimate budget impacts beyond the five-year window.  By 1996, CBO released its first 10-year budget baseline.

Following the money: doing health care better at less cost

Thomas Bodenheimer, a physician and professor at the UCSF School of Medicine, and Rachel Berry-Millett, a University of California medical student, preview an upcoming Synthesis report on care management.

As much as we all aspire to an ideal state of health, there are some people who are sicker than others in the United States.  Approximately 10% of patients consume 70% of health care expenditures.  In this group are the patients who have multiple chronic conditions, many medications, frequent hospitalizations, and limitations on their ability to perform basic daily functions. 

Health care spending for people with five or more chronic conditions is 17 times higher than for people with no chronic conditions. With the projected growth in the Medicare population in the next decade and the far higher prevalence of chronic conditions among this group, the cost of caring for this population threatens Medicare’s future viability. A real way to “bend the curve” is to improve the care and coordination of people with multiple chronic conditions.

Recent research that we conducted for the RWJF Synthesis Project showed us that this challenge may, indeed, be possible to address.  We preview the research in a new NEJM perspective, and our full Synthesis report will be available in a few months. 

Bringing home the costs of doing nothing

Bowen Garrett, a senior research associate at the Urban Institute, writes about new research about the consequences of doing nothing on health reform.

The health reform proposals currently under heated debate, by the very nature of the problems they are tackling, are complex and contain many moving parts.  This complexity makes it difficult for people to envision what their health insurance and health care will look like under reform.  It is natural for those who have good coverage now to prefer their current situation, which they know, to an uncertain world under health care reform.  Being shielded from the full costs of the health care they receive, people who now have coverage from their employers can be comfortably numb to the sting of rapidly increasing health care costs that we all face.  The problem is, the status quo is not lying still.  It is moving—in a very bad direction.

Earlier this year, my colleagues and I at the Urban Institute put out a report about the economic implications for the nation if health reform legislation does not happen this year.  Based on economic trends and health care cost growth and other factors, we predicted that large numbers of people who have private health insurance coverage now would lose it over the next 10 years.  Middle-class families would be hit the hardest.  Health care costs paid by employers, and federal and state governments, would rise dramatically.  Individuals and families would be forced to pay more in taxes, face slower wage growth, and bear even higher out-of-pocket health care costs than they do now. 

Our findings for the nation as a whole were striking and sobering, but they become even more relevant to us when they get closer to home.  So today, with the Robert Wood Johnson Foundation, we’re releasing a report that estimates what would happen state-by-state, and in the District of Columbia, if health reform fails.   

The possibilities of aligned interests on health care

Margaret Stanley, former executive director of the Puget Sound Health Alliance, writes about the value of bringing diverse stakeholders into local alliances to reform health care.

As national leaders have learned again and again, assembling a fractious group of doctors, hospitals, insurers, businesses, patients and public officials around something as complex and divisive as overhauling health care isn’t easy.

But nowadays, as reasonable, well-intentioned people try to reach agreement on health reform in the midst of the ranting and clouds of misinformation, reaching consensus is especially important, because everyone’s got a role to play in making our health care better. 

From what I can tell, it may be easier to achieve true consensus around health care reform at the local level.  That’s why much of my hope for a real health care overhaul rests on the power of local organizations, like the one I headed for three years, the Puget Sound Health Alliance.  In a few years, we were able to forge partnerships across stakeholder lines to improve the quality and efficiency of health care across the Greater Seattle region. 

The high cost of health care: getting past denial

      

Jonathan S. Skinner, Elliott S. Fisher, and Jonathan Sutherland of the Dartmouth Atlas Project at the Dartmouth Institute for Health Policy and Clinical Practice at Dartmouth College write about the opportunities to pay for health care reform by reducing unnecessary spending.

The President’s recent speech called on Congress to move forward with much needed health care reform.  He wisely argued that reducing the waste in our current health care system can help provide the savings needed to cover the costs of expanding coverage to the uninsured.  This might appear to be obvious – many studies (including this one from the Commonwealth Fund) have shown the U.S. spends twice as much as other countries on health care, yet often lags behind in quality.  Furthermore, a number of studies from the Dartmouth Atlas group (here and here) have pointed to the dramatic differences in both levels of health care spending -- $16,351 per Medicare beneficiary during 2006 in Miami, compared to $6,604 in Richmond Virginia – and the apparent lack of better outcomes in these higher cost regions.

But not everyone is convinced.  One recent critic today even claimed that all regional variations in spending can be justified by medical need and poverty: The reason why Medicare spends so much more for patients in Newark, N.J. than it does for patients at the Mayo Clinic in Minnesota is because people in Newark are poorer and sicker.   In a recent article published online in the New England Journal of Medicine, we test this hypothesis rigorously using a large nationally representative sample of more than 15,000 Medicare enrollees.  By using individual data reporting income, health status, price-adjusted Medicare expenditures (to account for the fact that cost-of-living in New York is greater than in Oklahoma City), and other factors, we sought to gain the most accurate picture of what explains regional variations in spending – and more importantly, what doesn’t.

Regulations and health care reform: the devil's in the details

Peter V. Lee, co-chairman of the Consumer Purchaser Disclosure Project (CPDP) and executive director for national policy of the Pacific Business Group on Health, writes about how current efforts to regulate physician reimbursement for Medicare shed light on the importance of the regulatory process that would follow any health reform legislation.

Organizations interested in promoting better, more affordable and accessible health care are not only weighing on the national reform debate – last week, many of these organizations weighed in as a group on regulatory proposals to change how the Centers for Medicare and Medicaid Services (CMS) reimburses doctors.  

“Many of the proposed changes represent steps in the right direction,” the group said in a letter to acting centers Administrator Charlene Frizzera, “but they are incremental and marginal improvements where bold changes are required.”

A sustainable healthcare system

Mike Chernew, a professor and economist on health policy at the Harvard Medical School, writes about the topic of health care costs and health reform. A piece by Dr. Chernew and others appears today in a special themed issue of Health Affairs and an article on the associated study appears today in the New York Times here. 

As the debate surrounding health care reform enters its final phases, it is not surprising that cost containment is among the last, most intractable issues of contention.  The central question often seems to be: ‘how can we achieve enough savings from the system, or raise enough money, to finance reductions in the number of uninsured?’  This is admittedly a crucial question, but, for several reasons, answering this question is insufficient and framing the question this way is distracting.

First, cost containment is inherently controversial.  One sector’s costs are another sector’s revenues and the laws of accounting dictate that we can only save money by paying less or doing less. Paying less inevitably raises the opposition of providers.  If we could save enough money by keeping people healthy, and thereby doing less because we need to do less, cost containment would not be so controversial (though provider revenue, and likely profits, would still fall).  However it seems unlikely that this most rosy of cost containment strategies will be able to generate sufficient savings. Cutting out waste is also appealing, but one person’s waste is another’s valued care and the process of identifying waste often leads to charges of rationing or stinting on care.  It seems unavoidable therefore that any realistic cost containment strategies will be distasteful.