Piper Report
Blog on Medicare, Medicaid, health reform, and more. Insights and resources on hot issues. Kip Piper, editor.
Healthcare consultant, speaker, and writer. Expert on Medicare, Medicaid, health reform, and pharma, biotech, and medical technology industries. President, Health Results Group LLC. Senior advisor to Sellers Dorsey, TogoRun, and Fleishman-Hillard. Visit KipPiper.com. Or email Kip here.
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Quality and Patient Safety
posted: September 8, 2010

Thumbnail image for ACO Primer by Kip Piper.jpgThe Accountable Care Organization (ACO) model is a new Medicare option for physicians, hospitals, and other providers to share in cost-savings. ACOs represent a dramatic change in Medicare policy and an opportunity to transform care delivery and provider alignment.


The Medicare Gain Sharing Program, part of the newly enacted healthcare reform law, creates the option for healthcare providers to form ACOs. Through an ACO, providers will take responsibility for quality and overall care of their Medicare patients. Medicare will
then share with ACO providers the savings from improved quality, fewer hospitalizations, and the elimination of unnecessary costs.


Starting in 2012, the ACO model will be a nationwide option in Medicare fee-for-service (FFS). In addition to shared savings, the ACO option includes freedom of choice for Medicare beneficiaries, national quality measures, evidence-based medicine, patient-centered care delivery, advanced care coordination, and information sharing.


Because the ACO model is designed to break down old barriers for providers to work together to improve care and reduce medical costs, state Medicaid programs and private health insurers will likely join Medicare in supporting the ACO model. Medicare may give preference to ACOs that are participating in similar arrangements with Medicaid, private payers, and other third parties - that is, multi-payor ACOs.


Specifically, Section 1899 of the Social Security Act governs the new Medicare Shared Savings Program and the option for providers to form ACOs. The law was created by Section 3022 of the Patient Protection and Affordable Care Act of 2010 (PPACA). The Centers for Medicare and Medicaid Services (CMS) must implement the ACO option no later than January 1, 2012. CMS plans to release proposed rules by late 2010.


To learn more about Accounable Care Organizations, please read my primer article on ACOs in the journal American Health & Drug Benefits.

posted: September 1, 2010

Piggy bank with stethoscope.jpgUnder the Patient Protection and Affordable Care Act (PPACA) of 2010, Medicare providers, including physician groups and hospitals, will soon have the option to form Accountable Care Organizations (ACOs) to improve quality and efficiency.


ACO providers may share financial gains generated from improved clinical and economic performance, provided that quality goals and patient safeguards are met. Through future regulations, the Centers for Medicare and Medicaid Services (CMS) must implement the Medicaid ACO option no later than January 1, 2012. Proposed rules are expected by late 2010.


In this interview, Dr. Mark B. McClellan, former CMS Administrator and FDA Commissioner, discusses the extraordinary implications of the new ACO option for improving patient care and reducing unnecessary costs.


Mark is director of the Engelberg Center for Health Care Reform at the Brookings Institution, a influential think tank in Washington, DC. The Engelberg Center is engaged in several interesting projects.


To read this interview in the journal American Health & Drug Benefits, click here (opens PDF).

posted: July 1, 2010

AHDB June 2010.jpgThe latest issue of the journal American Health & Drug Benefits includes a valuable mix of studies and articles of interest to decision makers. Topics include health reform, bundled payment, drug pricing, benefit design, Medicaid, medication therapy, and specific clinical conditions.


The Health Reform Law: Key Changes to Be Implemented in 2010
By Kip Piper, MA, FACHE


Federal Drug Price Controls in Medicaid: Expansion of Mandated Rebates under Health Reform Law
By Kip Piper, MA, FACHE


Prevalence of Treated Bipolar Disorders and Associated Comorbidities in Managed Care and Medicaid Populations
By Jeff J. Guo, PhD; Nick C. Patel, PharmD, PhD; Hong Li, PhD; and Paul E. Keck Jr, MD. With Stakeholder Perspective by Nirav R. Shah, MD, MPH


Impact of Etanercept Treatment on Absenteeism and Productivity: The Work Loss and Productivity Survey
By Denise Globe, PhD; Peter Mazonson, MD, MBA; Chris Santas, MBA; Regina Murphy, MBA; Annie Cheng; Xingyue Huang, BPharm, PhD; and Arthur Kavanaugh, MD. With Stakeholder Perspective by Atheer A. Kaddis, PharmD


Health Benefit Coverage, Reimbursement, and Influences on Traditional Pharmaceutical Channels
By F. Randy Vogenberg, RPh, PhD. With Stakeholder Perspective by Gary M. Owens, MD


Bundled Payment: A Promising Initiative of Payment Reform
By Jim Evans


Impact of 2 Copay Waivers in a Generic Incentive Program
By Anthony F. Liu, MSCS; Tom Jecklin; Geoffrey Lee; and James Hogan


Medication Adherence: Effectiveness of Physician Alerts to Resolve Potential Gaps in Pharmacotherapy
By Joshua N. Liberman, PhD; Janice Moore, MPH; Asif Ally, RPh, MBA; and Troyen A. Brennan, JD, MD


New Approaches to Treating HCV Infection
By Caroline Helwick


Promising New Approaches to Multiple Sclerosis Medications: AAN 2010
By Alice Goodman


The June issue of AHDB includes highlights from the 2010 annual meeting of the Academy of Managed Care Pharmacy:

  • Patient Out-of-Pocket Cost Affects Adherence to Oral Oncology Medications

  • Cost-Effectiveness Trends for 20 Top-Selling Drugs

  • Effect of Diabetes Medication Adherence on Costs and Outcomes

  • Applying Pharmacogenomics in Oncology Care

  • Read or Download June 2010 Issue:


    To read or download the June 2010 issue, click here. To read or download specific articles in PDF, click here.


    American Health & Drug Benefits:


    American Health & Drug Benefits is available in print and online at www.AHDBonline.com. AHDB is a peer-reviewed journal for 30,000 decision makers in health plans, prescription drug plans, PBMs, the federal Medicare program, state Medicaid programs, and the pharma, biotech, and medical device and diagnostics industries.


    Kip Piper is health policy editor of American Health & Drug Benefits.

    posted: April 28, 2010

    AHDB March-April 2010.jpgThe latest issue of the journal American Health & Drug Benefits includes a valuable mix of studies and articles on economic, regulatory, and clinical issues of particular interest to payors, purchasers, and policymakers.


    Obesity: Effective Treatment Requires Change in Payers' Perspective by Rhonda Greenapple, MSPH and Jackie Ngai, MS, with Stakeholder Perspective by Jeff Januska, PharmD.


    Health Insurance Premium Increases for the 5 Largest School Districts in the United States, 2004-2008 by John R. Cantillo, MBA, with Stakeholder Perspective by F. Randy Vogenberg, PhD, RPh.


    Evolving Trends in Insulin Delivery: In Pursuit of Improvements in Diabetes Management by Firas Akhrass, MD; Nancy Skinner, RN, CCM; Kimberly Boswell, MD; and Luther B. Travis, MD, with Stakeholder Perspective by James V. Felicetta, MD.


    Healthcare Costs Associated with Switching from Brand to Generic Levothyroxine by Michael Katz, PharmD; Joseph Scherger, MD, MPH; Scott Conard, MD; Leslie Montejano, CCRP; and Stella Chang, MPH, with Stakeholder Perspective by Michael S. Jacobs, RPh.


    Pay-for-Performance Initiatives: Modest Benefits for Improving Healthcare Quality by Amit Sura, MD, MBA and Nirav R. Shah, MD, MPH, with Stakeholder Perspective by Steven T. Kmucha, MD, JD.


    Pharmacogenomics and Drug Development by Michael F. Murphy, MD, PhD.


    First Anti-Inflammatory Generic Drug Promising New Therapy for Diabetes by Dalia Buffery, MA, ABD.


    The Cardiovascular Pipeline: ACC 2010 Features Late-Stage Drugs by Wayne Kuznar.


    NCCN Panel Debates the Economics of Cancer Care by Caroline Helwick.


    PET Scans Not Recommended for Most Patients with Breast Cancer: Potential New Controversy in Breast Cancer Testing by Caroline Helwick.


    American Health & Drug Benefits:


    American Health & Drug Benefits is available in print and online at www.AHDBonline.com. AHDB is a peer-reviewed journal for 30,000 decision makers in health plans, prescription drug plans, PBMs, the federal Medicare program, state Medicaid programs, and the pharma, biotech, and medical device industries. Kip Piper is health policy editor of American Health & Drug Benefits.

    posted: April 3, 2010

    Medical Malpractice.jpgAn interesting new report assesses a variety of medical malpractice reforms. The study synthesizes the evidence or theoretical predictions regarding several leading medical malpractice reform ideas.


    The report synthesizes published evidence on 8 reforms widely used by states:

    • Caps on non-economic damages
    • Pretrial screening panels
    • Certificate of merit requirements
    • Attorney fee limits
    • Joint and several liability rule reform
    • Collateral source rule reform
    • Periodic payment
    • Statutes of limitation or repose


    These reforms are evaluated based on their effects on frequency and cost of malpractice claims, medical liability system overhead costs, health care providers' liability costs, defensive medicine (including utilization and spending), supply of health care services (including physician supply and patient health insurance coverage), and quality of care.


    The report also reviews 6 other, more innovative but largely untested medical malpractice reforms:

    • Schedules of non-economic damages
    • Health courts
    • Disclosure and offer programs
    • Safe harbors for physician adherence to evidenced-based clinical practice guidelines
    • Subsidized reinsurance that is made conditional upon meeting particular patient safety goals
    • Enterprise medical liability


    Based on theoretical predictions, the authors suggest that most of these latter reforms are promising enough to merit demonstrations.


    The study was commissioned by the Medicare Payment Advisory Commission (MedPAC) and produced by Michelle M. Mello, JD, PhD, professor of law and public health at the Harvard School of Public Health and Allen Kachalia, MD, JD, assistant professor at the Harvard Medical School and medical director for quality and safety, Brigham and Women's Hospital.

    posted: November 8, 2009

    AHDB Sept and Oct 2009.jpgHere are articles from the latest issue of American Health & Drug Benefits. AHDB is a peer-reviewed journal for 30,000 decision makers in health plans, PBMs, Medicare, Medicaid, and the pharma and biotech industries:


    Predictive and Prognostic Models: Implications for Healthcare Decision-Making in a Modern Recession:

    F. Randy Vogenberg, RPh, PhD examines the role of predictive modeling in the healthcare decision-making process and its impact on clinical outcomes. Dr. Vogenberg discusses the difference in the value of modeling to patients, providers, employers, and health insurers. He describes how applying predictive modeling can enhance patients' and providers' ability to make the best clinical decisions. Dr. Vogenberg is principal, Institute for Integrated Healthcare, Sharon, MA; adjunct Instructor, University of Rhode Island College of Pharmacy; and senior fellow, Jefferson University School of Population Health, Philadelphia, PA.


    Estimates of Commercial Population at High Risk for Cardiovascular Events: Impact of Aggressive Cholesterol Reduction:

    Kathryn Fitch, RN, MEd; Sara W. Goldberg, FSA, MAAA; Kosuke Iwasaki, FIAJ, MAAA; Bruce S. Pyenson, FSA, MAAA; Andreas Kuznik, PhD; and Henry A. Solomon, FACP, FACC analyze the effects of statin therapies on working age people at high-risk for cardiovascular disease. Using a target population of between ages 35-69, the authors found that 4 percent of the target population generated 22 percent of the risk for coronary heart disease and stroke, and that aggressive cholesterol-lowering statins significantly reduced the potential for events and is cost-neutral for payers. Ms. Fitch is healthcare management consultant, Ms. Goldberg is consulting actuary, Mr. Iwaski is consulting actuary, and Mr. Pyenson is principal and consulting actuary, at Milliman. Dr. Kuznick is associate director of outcomes research and Dr. Solomon is medical director at Pfizer.


    Impact of Prescription Benefit Coverage Limits on Sevelamer Hydrochloride Adherence for Patients with ESRD:

    Bharati Bhardwaja, PharmD, BCPS; Nikki Carroll, MS; Eli Korner, PharmD; and Kavita V. Nair, PhD discuss a new study that assesses the effects of prescription benefit coverage on medication adherence among Medicare beneficiaries diagnosed with end-stage renal disease (ESRD) taking sevelamer hydrochloride. The authors draw on lessons learned from caps on total drug spending and its impact on medication adherence, and conclude that caps on adherence negatively impact adherence and healthcare costs. Dr. Bhardwaja is a nephrology clinical pharmacy specialist, Kaiser Permanente and clinical assistant professor, University of Denver School of Pharmacy. Ms. Carroll is biostatistician at Institute for Health Research, Kaiser Permanente. Dr. Korner was research investigator, Kaiser Permanente during this study and is currently medical liaison, virology and hepatology, Roche Laboratories. Dr. Nair is associate professor, School of Pharmacy, University of Colorado at Denver.


    Private Health Plans Perspectives: Electronic Personal Health Records and Electronic Prescribing:

    Nancy M. McGee, JD, MPH; Gene Reeder, RPh, PhD; Timothy S. Regan, BPharm, RPh, CPh; J.D. Kleinke; and Steve Arnold, MD, MS, MBA, CPE analyze the results of a survey of commercial payers representing 16 national plans and 80 million covered lives to better understand payer involvement in electronic personal health records (ePHR) and e-prescribing. While respondents were enthusiastic about ePHRs and have aggressively moved to implement them, there was also disappointment in members' low utilization of these electronic systems. The authors suggest that Americans' concern about their health data being used inappropriately may be at the root. Ms. McGee is senior vice president and chief operating officer, Lash Group, San Bruno, CA. Dr. Reeder is director of payer market research at Xcenda. Mr. Regan is executive director, customer insights, at Xcenda. Mr. Kleinke is chief executive officer, Mount Tabor Online Services, Portland, OR. Dr. Arnold is vice president and chief medical officer, Touchstone Health Plan, Lagangeville, NY.


    Debate on the Elderly and End of Life Care Under Health Reform:

    In The Politics of Epidemiology, by Robert E. Henry, and End-of-Life Choices Are Necessary in Any Healthcare Reform by Gary M. Owens, MD, the authors tackle the thorny issue of how to address the elderly and end-of-life, both in healthcare reform and as a society. Mr. Henry argues that it is not a part of America's fundamental character to adopt policies that would determine what kind of care a person gets based on age and infirmity and that the government should avoid mandating processes that might ultimately encourage terminally ill patients to die quickly and efficiently. Dr. Owens argues that meaningful conversations between physician and family members and patients about their wishes at the end of their lives are important and should be encouraged to avoid potentially aggressive treatments that the patients themselves may not want. While he agrees that a health system should support the health of citizens, it should also respect the values of those facing end-of-life decisions. Mr. Henry is editor-in-chief of American Drug and Health Benefits. Dr. Owens is president, Gary Owens Associates, Philadelphia, PA.


    Can Generics Help Heal Our Ailing Healthcare System:

    Dalia Buffery, MA, ABD discusses the current struggle in Congress over the role and place of biosimilars. Recent legislative skirmishes in the House Energy and Commerce Committee defeated the 5-year exclusivity period for biosimilars proposed by Chairman Henry Waxman in favor of a 12-year exclusivity period. She asserts that while generic oral drugs have saved over $734 billion in the last decade, it will be important to craft a bill on biosimilars that both encourages and rewards innovation while also reducing costs to the system in the long run. Ms. Buffery is editorial director, American Health and Drug Benefits.


    Learn More:


    American Health & Drug Benefits is available in print and online at www.AHDBonline.com. To view the current or past issues or download in PDF format, click here.


    Kip Piper is health policy editor of American Health & Drug Benefits

    posted: August 9, 2009

    At the last annual meeting of the Academy of Managed Care Pharmacy, several of us spoke on pharmaceutical research and development in the quickly emerging value-driven healthcare system. Topics focused on the impact of value-based benefit designs, comparative effectiveness research, and government policies on the development of new drugs and biologics:


    Research and Development in the Current Healthcare System: An Overview
    Thomas McCarter, MD, FACP


    What Constitutes Medical Evidence in the Era of Comparative Effectiveness?
    Nirav R. Shah, MD, MPH, FACP


    New Government Policies: Opportunities for Supporting Research and Development
    Kip Piper, MA, FACHE


    Drug Discovery and Development in a Value-Driven Healthcare System
    Matthew Sarnes, PharmD


    A Hypothetical Case: Current Drug R&D Process
    Michael F. Murphy, MD, PhD


    Our presentations were published in a supplement issue of American Health & Drug Benefits, a peer-reviewed journal serving about 30,000 decision makers. To read the articles, which are approved for continuing education credit, click here.

    posted: July 30, 2009

    Doctor Catching Up on Laptop.jpgHere are articles from the latest issue of American Health & Drug Benefits. AHDB is a peer-reviewed journal for 30,000 decision makers in health plans, PBMs, Medicare, Medicaid, and the pharma and biotech industries:


    June - July 2009 Issue:


    Applying Evidence for Medical Technologies: Closing the Gap between R&D and Decision Maker Need
    Interview with Sean R. Tunis, MD, MSc


    The Working Patient with Cancer: Implications for Payers and Employers
    By Grant D. Lawless, BSPharm, MD, FACP


    Lower Copay and Oral Administration: Predictors of First-Fill Adherence to New Asthma Prescriptions
    By Zackary Berger, MD, PhD; William Kimbrough, MD; Colleen Gillespie, PhD; Joseph A. Boscarino, PhD, MPH; G. Craig Wood, MS; Zhengmin Qian, MD, PhD; J. B. Jones, PhD, MBA; and Nirav R. Shah, MD, MPH


    Use Pattern and Off-Label Use of Atypical Antipsychotics in Adults with Bipolar Disorder, 1998-2002
    Jeffery A. Demland, MS; Yonghua Jing, BPharm, PhD; Christina M. L. Kelton, PhD; Jeff J. Guo, BPharm, PhD; Hong Li, MPH, PhD; and Patricia R. Wigle, PharmD


    Biosimilars Policy Forum: Perspectives on Safety and Efficacy of Future Products
    By F. Randy Vogenberg, RPh, PhD


    Payer Perspectives on Healthcare Reform
    By Peyton Howell, MHA; Gene Reeder, RPh, PhD; and Timothy S. Regan, BPharm, RPh, CPh


    Prioritizing Healthcare Resources to Keep the Baby Boomers Out of Nursing Homes
    By Robert E. Henry


    The View from Washington: Healthcare Reform
    By John Gorman


    Read Current and Past Issues:


    American Health & Drug Benefits is available in print and online at www.AHDBonline.com. To view the current or past issues or download in PDF format, click here.


    AHDB also published web exclusives, available for reading here.


    Kip Piper is health policy editor of American Health & Drug Benefits.

    posted: May 27, 2009

    Federal%20CER.jpgFederal agencies are busy implementing the new program for comparative effectiveness research. The Federal Coordinating Council for Comparative Effectiveness Research (CER) has released, for public comment, a draft definition of CER and draft prioritization criteria for making research selections. The definition and criteria are intended to help guide, albeit at a high level, federal use of the $1.1 billion appropriated for comparative effectiveness research in FY 2009 and FY 2010 in the American Recovery and Reinvestment Act (ARRA).


    Draft Definition of Comparative Effectiveness Research for the Federal Coordinating Council:


    Comparative effectiveness research is the conduct and synthesis of systematic research comparing different interventions and strategies to prevent, diagnose, treat and monitor health conditions. The purpose of this research is to inform patients, providers, and decision-makers, responding to their expressed needs, about which interventions are most effective for which patients under specific circumstances. To provide this information, comparative effectiveness research must assess a comprehensive array of health-related outcomes for diverse patient populations. Defined interventions compared may include medications, procedures, medical and assistive devices and technologies, behavioral change strategies, and delivery system interventions. This research necessitates the development, expansion, and use of a variety of data sources and methods to assess comparative effectiveness.


    Draft Prioritization Criteria for Comparative Effectiveness Research:


    Threshold Minimal Criteria (i.e. must meet these to be considered):


  • Included within statutory limits of Recovery Act and FCC definition of CER.

  • Responsiveness to expressed needs and preferences of patients, clinicians, and other stakeholders, including community engagement in research.

  • Feasibility of research topic (including time necessary for research).

  • Prioritization Criteria:


    The criteria for scientifically meritorious research and investments are:


  • Potential Impact (based on prevalence of condition, burden of disease, variability in outcomes, and costs of care).

  • Potential to evaluate comparative effectiveness in diverse populations and patient sub-populations.

  • Uncertainty within the clinical and public health communities regarding management decisions.

  • Addresses need or gap unlikely to be addressed through other funding mechanisms.

  • Potential for multiplicative effect (e.g. lays foundation for future CER or generates additional investment outside government).

  • To comment on the draft definition and criteria, click here.


    Plans for Implementing Comparative Effectiveness Research:


    Of the $1.1 billion Congress appropriated for comparative effectiveness research, the Agency for Healthcare Research and Quality (AHRQ) received $300 million, the National Institutes of Health (NIH) received $400 million, and the HHS Office of the Secretary (OS) received $400 million. They have each developed plans for implementing their parts of the federal CER initiative:


  • AHRQ Implementation Plan for Comparative Effectiveness Research.

  • NIH Implementation Plan for Comparative Effectiveness Research.

  • Office of the Secretary Implementation Plan for Comparative Effectiveness Research.

  • Lessons from Comparative Effectiveness Research in Other Countries:


    Meanwhile, an interesting new report from the Deloitte Center for Health Solutions profiles comparative effectiveness programs in the United Kingdom, Australia, Canada, and Germany. The report nicely lays out the complexity, challenges, and usefulness of comparative effectiveness. It also gives a helpful history of CER in the U.S. To read the report, click here (PDF).

    posted: January 13, 2009

    Management%20Challenges.jpgThe incoming leadership at the U.S. Department of Health and Human Services (HHS) face a number of serious management challenges. These challenges, recently identified by the Office of the Inspector General (OIG), will require close, sustained attention by the Secretary's Office and the agency heads, particularly at CMS and FDA.


    The nominees for Secretary and Deputy Secretary - Tom Daschle and Bill Corr, respectively - are wise choices, especially given President-elect Obama's policy perspective and strong interest in national health reform. They are smart, seasoned policy gurus with strong relationships on the Hill. However, as the Obama Administration populates the agencies with appointees, the White House and HHS leadership should seriously consider the need for strong executives and senior management types for top positions at agencies like CMS, FDA, CDC, and NIH. Yes, they will need requisite policy and technical expertise, but at the agency level management savvy should be a priority.


    The reason is simple. The existing management challenges certainly require attention. Further, the ultimate success of the Obama Administration's health care agenda may well depend on fixing these problems. Also, the HHS Secretary's Office and the new White House Office of Health Reform will have their hands full with health reform legislation, Medicare fixes, and FDA legislation. And the White House and HHS leadership will need strong executives to effectively implement the range of major, complex new policies expected in 2009 and 2010. The Democrats have a fairly deep bench when it comes to policy wonks, researchers, and academics generally. Their bench for executives and managers is relatively thin - but they could look within the agencies themselves and in state government for management talent friendly to the Administration's policy views.


    Here is the OIG's list of top management challenges at HHS:


    Oversight of Medicare Part D Prescription Drug Benefit:

  • Drug pricing and rebates

  • Fraud and abuse safeguards

  • Access to accurate information

  • Medicare Program Integrity:

  • Contractor oversight

  • DME fraud, including error rate and competitive bidding

  • Medicare Advantage

  • Integrity of Medicaid and State Children's Health Insurance Program:

  • Prescription drugs, including fraud and pharmacy reimbursement

  • SCHIP reauthorization and eligibility

  • Home and community-based care in Medicaid

  • Quality of Care:

  • Quality measurement

  • Pay for performance (P4P)

  • Failure of care and never events

  • Transparency of ownership and performance

  • Indian health care

  • Emergency Preparedness and Response:

  • Pandemic influenza

  • Select agent transfers

  • Laboratory security

  • Oversight of Food, Drugs, and Medical Devices by FDA:

  • Food safety and security

  • Drug and medical device safety

  • Transparency of provider financial interests

  • Grants Management:

  • Grant oversight and closeout

  • President's Emergency Plan for AIDS Relief expansion

  • Head Start facility safety and compliance

  • Integrity of Information Systems and the Implementation of Health Information Technology:

  • Security of sensitive and personally identifiable information

  • Safeguards and controls over HHS information systems

  • Electronic health records and e-prescribing

  • Ethics Program Oversight and Enforcement:

  • Management of conflicts of interest by extramural grantees

  • Oversight of financial interests of clinical investigators and advisory board members

  • Oversight of HHS employees' outside and post-employment activities
  • posted: December 23, 2008

    Drug%20Use%20in%20SNP%20and%20MAPD.jpgMedicare beneficiaries in Special Needs Plans (SNPs) have higher Part D prescription drug utilization and costs than enrollees in other Medicare Advantage Prescription Drug Plans (MA-PDs) do. This is no surprise since, by design, Special Needs Plans serve higher-risk Medicare patients, including many dual eligibles. However, despite higher drug utilization rates in SNPs, SNP enrollees and other MA-PD enrollees have similar rates of inappropriate drug pairs (therapeutic duplications and drug-drug interactions).


    Compared to enrollees in other (non-SNP) Medicare Advantage drug plans, SNP enrollees fill 11% more scripts. The average annual prescription cost per SNP beneficiary is 49% higher compared to that of other MA-PD beneficiaries. The difference in per capita drug costs between SNPs and other MA-PDs appears due to a combination of factors: SNP beneficiaries' higher utilization, use of costlier drugs, lower utilization of 90-day prescriptions, and SNPs paying more for some highly utilized drugs.


    While SNP beneficiaries fill more prescriptions on average than other MA-PD beneficiaries, SNP and other MA-PD beneficiaries are exposed to potentially inappropriate drug pairs at similar frequencies. However, at higher levels of drug utilization, SNP beneficiaries are less likely to be exposed to a potentially inappropriate drug pair than other MA-PD beneficiaries.


    Most inappropriate drug pairs (65%) in SNPs and MA-PDs are drug-drug interactions. Of these, 83% presented a moderate risk and 17% a serious or severe risk of an adverse drug event. The remaining potentially inappropriate drug pairs (35%) are therapeutic duplications. The majority of inappropriate drug pairings - in both SNPs and other MA-PDs - recur and involve drugs prescribed by the same physician and filled by the same pharmacy.


    These findings, from a new analysis of 2006 data by the HHS OIG, provide further evidence for the urgent need of e-prescribing nationwide. There is also a need for genuine medication therapy management programs and more information and decision support tools for physicians and pharmacists - as well as sharpened accountability for those relatively small number of prescribers and dispensers who apparently generate the majority of potentially dangerous drug pairings.

    posted: December 22, 2008

    IOM%2020%20Indicators.jpgThe Institute of Medicine (IOM) has identified 20 key indicators that together "reflect the overall health of the nation and the efficiency and efficacy of U.S. health systems."


    Each of the 20 indicators can be readily measured over time using existing, publicly collected, reasonably high quality data. In addition to supporting nationwide snapshots, they permit drill-down views based on geography, population subgroups, and socioeconomic status.


    Here are the IOM's key indicators:


    Health Outcomes:


    1. Life Expectancy at Birth (number of years that a newborn is expected to live if current mortality rates continue to apply).


    2. Infant Mortality (deaths of infants aged under 1 year per 1,000 live births).


    3. Life Expectancy at Age 65 (number of years of life remaining to a person at age 65 if current mortality rates continue to apply).


    4. Injury Related Mortality (age-adjusted mortality rates due to intentional and unintentional injuries).


    5. Self-Reported Health Status (percentage of adults reporting fair or poor health).


    6. Unhealthy Days Physical and Mental (mean number of physically or mentally unhealthy days in past 30 days).


    7. Chronic Disease Prevalence (percentage of adults reporting one or more of six chronic diseases [diabetes, cardiovascular disease, chronic obstructive pulmonary disease, asthma, cancer, and arthritis]).


    8. Serious Psychological Distress (percentage of adults with serious psychological distress as indicated by a score of > 13 on the K6 scale, with scores ranging from 0-24).


    Health Related Behaviors:


    9. Smoking (percentage of adults who have smoked > 100 cigarettes in their lifetime and who currently smoke some days or every day).


    10. Physical Activity (percentage of adults meeting the recommendation for moderate physical activity [at least 5 days a week for 30 minutes a day of moderate intensity activity or at least 3 days a week for 20 minutes a day of vigorous intensity activity]).


    11. Excessive Drinking (percentage of adults consuming four [women] or five [men] or more drinks on one occasion and/or consuming more than an average of one [women] or two [men] drinks per day during the past 30 days)


    12. Nutrition (percentage of adults with a good diet [conformance to federal dietary guidance] as indicated by a score of > 80 on the Healthy Eating Index)


    13. Obesity (percentage of adults with a body mass index > 30).


    14. Condom Use (proportion of youth in grades 9-12 who are sexually active and do not use condoms, placing them at risk for sexually transmitted infections).


    Health Systems:


    15. Health Care Expenditures (per capita health care spending).


    16. Insurance Coverage (percentage of adults without health coverage via insurance or entitlement).


    17. Unmet Medical, Dental, and Prescription Drug Needs (percentage of [non-institutionalized] people who did not receive or delayed receiving needed medical services, dental services, or prescription drugs during the previous year).


    18. Preventive Services (percentage of adults who are up-to-date with age-appropriate screening services and flu vaccination).


    19. Childhood Immunization (percentage of children aged 19-35 months who are up-to-date with recommended immunizations).


    20. Preventable Hospitalizations (hospitalization rate for ambulatory care-sensitive conditions).


    State of the USA - a new non-profit endeavor developed under the auspices of The National Academy of Sciences and funded by several major foundations - sponsored the IOM project to identify the indicators. The IOM committee of experts was asked to (a) select indicators that, taken together, give "a broad view of health in America, covering health care, health status, and health determinants" and (b) choose only 20 indicators to ensure "maximum clarity and focus."









    posted: December 21, 2008

    Adverse%20Events.jpgHistorically, traditional payment policies - coupled with lax oversight by regulators, weak leadership from many corners of the hospital and physician communities, and an uninformed, reverential public - have served to perpetuate (sometimes even reward) the use of unsafe practices and antiquated technologies in the hospital industry. This, in turn, resulted in a frightening number of adverse events - instances where patients are harmed by medical care. The consequences are tens of thousands of deaths and millions of injuries - the vast majority quite avoidable.


    Fortunately, reduction of adverse events is now a priority. This is led by new payment and reporting policies by Medicare and some state Medicaid programs, influential players like IHI and the Leapfrog Group, the Hospital Quality Alliance, and a growing demand for disclosure of hospital and physician performance. Through realigned payment policies, public reporting of adverse events, and readily available best practices, hospitals are being given powerful new incentives to use safer practices.


    Key Issues in Adverse Event Reporting by Hospitals:


    The HHS Office of the Inspector General (OIG) has identified key issues affecting reporting of adverse events in hospitals:


  • Estimates of the incidence of adverse events in hospitals vary widely. Measurement remains difficult, although methods and tools to support proper reporting are advancing quickly.

  • Nonpayment policies for adverse events are gaining in prominence. Stakeholders see this as a powerful incentive to reduce preventable medical errors. However, there are potential drawbacks, such as perhaps discouraging hospitals from admitting complex cases and encouraging gaming in reporting.

  • Hospitals heavily rely on managers and staff to report adverse events internally, but barriers (cultural, organizational, physician relations, etc.) often inhibit reporting.

  • Hospitals report adverse events to various oversight entities. However, experts suspect substantial underreporting.

  • Public disclosure of adverse events benefits patients but also raises liability concerns.

  • Information on how to prevent adverse events is widely available. Nonetheless, many hospitals and clinicians are slow to adopt or use recommended patient safety practices.

  • The OIG believes we are finally "on the threshold of accelerated progress" in reducing the incidence of adverse events in hospitals. Yeah, their optimism is heavily couched but there has been some genuine progress. The OIG identifies a series of strategies that could hasten this.


    For the OIG report on key issues in reporting and reducing adverse events in hospitals, click here (PDF).


    State Requirements for Reporting Adverse Events:


    Today, 26 states now have adverse event reporting programs. The Institute of Medicine (IOM), which supports mandated reporting, says reporting helps hold individual hospitals accountable for performance while providing information to improve patient safety and save lives. States vary somewhat by the list of reportable events and criteria for identifying reportable events. Most of the 26 state systems focus on adverse events in hospitals but some also require or support reporting in other care settings.


    Most states told the OIG that "hospitals do not always report when adverse events occur." Underreporting is apparently common and probably substantial. To encourage better reporting, states have implemented various strategies. For example:


  • Legal protections to prevent improper disclosure.

  • Monetary penalties for failing to report an adverse event.

  • Giving feedback to hospitals about reported events.

  • Audits or state-led investigations of the hospitals' handling of reported events.

  • Promote learning through reports, training, and patient safety bulletins and alerts.

  • For the OIG report on state reporting programs, click here (PDF).

    posted: December 18, 2008

    CBO%20Health%20Budget%20Options.jpgTo aid the incoming 111th Congress and Obama Administration, the Congressional Budget Office (CBO) released a 235-page report outlining 115 budget options for health care reform. The report catalogs most of the hottest legislative ideas on Capitol Hill, with useful background information and scores of costs and savings. Here's the list of reform ideas in the report:


    The Private Health Insurance Market:


  • Foster the Formation of Association Health Plans

  • Allow Individuals to Purchase Non-Group Health Insurance Coverage in Any State

  • Impose a Pay-or-Play Requirement on Large Employers

  • Establish a National High-Risk-Pool Program

  • Establish a National Reinsurance Program to Provide Subsidies to Insurers and Firms for Privately Insured Individuals

  • Require States to Use Community Rating for Small-Group Health Insurance Premiums

  • Create a Voucher Program to Expand Health Insurance Coverage

  • Limit Awards from Medical Malpractice Torts

  • The Tax Treatment of Health Insurance:


  • Reduce the Tax Exclusion for Employment-Based Health Insurance and the Health Insurance Deduction for Self-Employed Individuals

  • Replace the Income Tax Exclusion for Employment-Based Health Insurance with a Deduction

  • Replace the Income and Payroll Tax Exclusion with a Refundable Credit

  • Allow Self-Employed Workers to Deduct Health Insurance Premiums from Income That Is Subject to Payroll Taxes

  • Expand Eligibility for an "Above-the-Line" Deduction for Health Insurance Premiums

  • Disallow New Contributions to Health Savings Accounts

  • Allow Health Insurance Plans with Coinsurance of at Least 50 Percent to Qualify for the Health Savings Account Tax Preference

  • Levy an Excise Tax on Medigap Plans

  • Changing the Availability of Health Insurance Through Existing Federal Programs:


  • Raise the Age of Eligibility for Medicare to 67

  • Create a Medicare Buy-In Program for Individuals Ages 62 to 64

  • Eliminate or Reduce Medicare's 24-Month Waiting Period for Recipients of Social Security Disability Benefits

  • Create a Medicaid Buy-In Program

  • Require States to Adopt Premium Assistance Programs for Medicaid Enrollees

  • Expand Eligibility for Medicaid Family Planning Services

  • Expand Medicaid Eligibility to Include Young Adults with Income Below the Federal Poverty Level

  • Expand Medicaid Eligibility to Include Parents with Income Below the Federal Poverty Level

  • Establish a Medicaid Outreach Program with Mandatory Funds

  • Permanently Extend the Transitional Medical Assistance Provision in Medicaid

  • Allow People and Firms to Buy Health Insurance Plans Through the Federal Employees Health Benefits Program

  • End Enrollment in VA Medical Care for Veterans in Priority Groups 7 and 8

  • Reopen Enrollment for VA Medical Care Among Priority Group 8 Veterans for Five Years

  • The Quality and Efficiency of Health Care:


  • Bundle Payments for Hospital Care and Post-Acute Care

  • Reduce Medicare Payments to Hospitals with High Readmission Rates

  • Expand the Hospital Quality Incentive Demonstration to All Hospitals

  • Deny Payment Under Medicaid for Certain Hospital-Acquired Conditions

  • Establish Regional Centers of Excellence for Selected Surgical Procedures Covered by Medicare

  • Convert Medicare and Medicaid Disproportionate Share Hospital Payments into a Block Grant

  • Consolidate Medicare and Federal Medicaid Payments for Graduate Medical Education Costs at Teaching Hospitals

  • Allow Physicians to Form Bonus-Eligible Organizations and Receive Performance-Based Payments

  • Pay Primary Care Physicians in Medicare Using a Partial-Capitation System, with Bonuses and Penalties

  • Pay for a Medical Home for Chronically Ill Beneficiaries in Fee-for-Service Medicare

  • Require Medicare Carriers to Provide Information About Peer Profiling to Physicians

  • Require Prior Authorization for Imaging Services Under Medicare

  • Encourage Wider Use of Patient Shared-Decision Aids by Physicians in Medicare

  • Expand Medicare's Least Costly Alternative Policy to Include Viscosupplements

  • Require Drug and Device Manufacturers to Disclose Their Relationships with Physicians Who Participate in Medicare

  • Fund Research Comparing the Effectiveness of Treatment Options

  • Create Incentives in Medicare for the Adoption of Health Information Technology

  • Require the Use of Health Information Technology as a Condition of Participation in Medicare

  • Support Development of VistA to Meet Standards and Encourage Adoption

  • Sponsor Regional Markets for Health Information Technology

  • Geographic Variation in Spending for Medicare:


  • Reduce Medicare's Fees for Physicians in Areas with Unusually High Spending

  • Reduce Medicare's Payment Rates for Hospitals in Areas with a High Volume of Elective Admissions

  • Reduce Medicare's Payment Rates Across the Board in High-Spending Areas

  • Impose a Surcharge on Medicare Cost Sharing in High-Cost Areas and Prohibit Medigap Plans from Covering the Surcharge

  • Paying for Medicare Services:


  • Reduce Annual Updates in Medicare Fee-for-Service Payments to Reflect Expected Productivity Gains

  • Reduce the Update Factor for Hospitals' Inpatient Operating Payments Under Medicare by 1 Percentage Point

  • Reduce the Update Factor for Payments to Providers of Post-Acute Care Under Medicare by 1 Percentage Point

  • Eliminate Inflation-Related Updates to Medicare's Payment Rates for Home Health Care for Five Years

  • Reduce the Update Factor for Medicare's Payments for Skilled Nursing Facilities by 1 Percentage Point

  • Modify the Sustainable Growth Rate Formula for Updating Medicare's Physician Payment Rates

  • Create Service-Specific Updates for Medicare's Physician Payment Rates

  • Use the Medicare Economic Index to Update Physician Payment Rates for Evaluation and Management Services and Create Four Service-Specific Updates for Remaining Services

  • Modify the Equipment Utilization Factor for Advanced Imaging in Calculating Physicians' Fees in Medicare

  • Set the Benchmark for Private Plans in Medicare Equal to Local Per Capita Fee-for-Service Spending

  • Convert Medicare to a Premium Support System

  • Establish Benchmarks for the Medicare Advantage Program Through Competitive Bidding

  • Eliminate the One-Sided Rebasing Process for Establishing Benchmarks for Medicare Advantage Plans

  • Require Manufacturers to Pay a Minimum Rebate on Drugs Covered Under Medicare Part D

  • Establish an Abbreviated Approval Pathway for Follow-On Biologics

  • Financing and Paying for Services in Medicaid and State Children's Health Insurance Program:


  • Convert the Federal Share of Medicaid's Payments for Acute Care Services into an Allotment

  • Remove or Reduce the Floor on Federal Matching Rates for Medicaid Services

  • Equalize Federal Matching Rates for Administrative Functions in Medicaid at 50 Percent

  • Restrict the Allocation to Medicaid of Common Administrative Costs

  • Reduce the Taxes That States Are Allowed to Levy on Medicaid Providers

  • Modify the Amount of the Brand-Name Drug Rebate in the Medicaid Program

  • Apply the Fee-for-Service Medicaid Drug Rebate to Drugs Purchased for Medicaid Managed Care Enrollees

  • Apply the Medicaid Additional Rebate to New Formulations of Existing Drugs

  • Base Medicaid's Pharmacy Payment Formulas for Brand-Name Drugs on the Average Manufacturer Price

  • Encourage Therapeutic Substitution in Medicaid by Applying Federal Upper Payment Limits to Two Classes of Drugs

  • Eliminate Allotment Caps for the State Children's Health Insurance Program and Permit States to Expand Coverage up to 400 Percent of the Federal Poverty Level

  • Adjust Funding for the State Children's Health Insurance Program to Reflect Increases in Health Care Spending and Population Growth

  • Premiums and Cost Sharing in Federal Health Programs:


  • Replace Medicare's Current Cost-Sharing Requirements with a Unified Deductible, a Uniform Coinsurance Rate, and a Catastrophic Limit

  • Restrict Medigap Coverage of Medicare's Cost Sharing

  • Combine Changes to Medicare's Cost Sharing with Restrictions on Medigap Policies

  • Impose Cost Sharing for the First 20 Days of a Stay in a Skilled Nursing Facility Under Medicare

  • Require a Copayment for Home Health Episodes Covered by Medicare

  • Impose a Deductible and Coinsurance for Clinical Laboratory Services Covered by Medicare

  • Increase the Basic Premium for Medicare Part B to 35 Percent of the Program's Costs

  • Permanently Extend the Provision That Provides Cost-Sharing Assistance for Qualifying Individuals Under Medicaid

  • Eliminate the Doughnut Hole in Medicare's Drug Benefit Design

  • Institute a Premium for Higher-Income Enrollees Under Medicare's Drug Benefit Similar to That Used in Part B

  • Increase the Fraction of Beneficiaries Who Pay an Income-Related Premium for Part B of Medicare

  • Base Federal Retirees' Health Benefits on Length of Service

  • Adopt a Voucher Plan for the Federal Employees Health Benefits Program

  • Require Federal Employees Health Benefits Plans to Subsidize Premiums for Medicare Part B and Reduce Coverage of Medicare Cost Sharing by an Equivalent Amount

  • Increase Health Care Cost Sharing for Family Members of Active-Duty Military Personnel

  • Introduce Minimum Out-of-Pocket Requirements Under TRICARE For Life

  • Increase Medical Cost Sharing for Military Retirees Who Are Not Yet Eligible for Medicare

  • Require Copayments for Medical Care Provided by the VA to Enrollees Without a Service-Connected Disability

  • Long-Term Care:


  • Increase States' Flexibility to Offer Home- and Community-Based Services Through Medicaid State Plan Amendments

  • Make Home and Community-Based Services a Mandatory Benefit Under Medicaid

  • Increase the Federal Matching Rate for Home and Community-Based Services and Decrease the Federal Matching Rate for Nursing Home Services

  • Clarify Medicaid's Definition of Permissible Asset Transfers

  • Increase the "Look-Back" Period for Transfers of Assets in Medicaid

  • Implement Policies That Encourage the Use of Advance Directives

  • Require Deposits to Individual Accounts for Purchasing Long-Term Care Insurance

  • Health Behavior and Health Promotion:


  • Impose an Excise Tax on Sugar-Sweetened Beverages

  • Increase the Excise Tax on Cigarettes by One Dollar Per Pack

  • Increase All Taxes on Alcoholic Beverages to $16 Per Proof Gallon

  • Reduce Medicare Payment Rates for Primary Care Physicians Who Do Not Meet Benchmarks for Influenza Vaccination

  • Base Medicare's Coverage of Preventive Services on Evidence of Effectiveness

  • Closing the Gap Between Medicare's Spending and Receipts

  • Increase the Payroll Tax Rate for Medicare Hospital Insurance by 1 Percentage Point

  • Limit Growth in Medicare Per Capita Spending to Growth in Per Capita Gross Domestic Product Plus 1 Percentage Point

  • Design an Enforcement Mechanism for the Medicare Funding Warning

  • Set a Savings Target to Reduce Spending for Medicare by 1 Percent

  • Increase Funding for the Health Care Fraud and Abuse Control Program in Medicare and Medicaid

  • posted: May 9, 2008

    RDHC.jpgSerious and costly performance problems riddle U.S. health care. Because of overuse, under use, and misuse of health care, researchers at the Juran Institute and elsewhere estimate that about 30 percent of health care costs are generated by poor quality. Therefore, poor quality medical care will cost about $720 billion in 2008 (30% of $2.4 trillion).


    Poor quality also reduces productivity. For every dollar of health care spending caused by poor quality, poor care costs an estimated 50 cents in lost productivity. When applied to the $822 billion in care provided through employer-sponsored insurance, this translates to an additional $123 billion in costs.


    A recent study by the Health Research Institute at PricewaterhouseCoopers estimates that wasteful health care spending costs $1.2 trillion annually. Analyzing findings from a wealth of published studies, the PwC researchers looked at the cost of waste from clinically inappropriate care and overt errors, individual behaviors leading to costly health problems, and antiquated operational processes that add costs without providing any value.


    Making matters worse, research on the care patients receive from physicians, hospitals, and other providers paints a frustrating, even scary picture. For example, studies conducted by the respected RAND Corporation show that Americans receive clinically inadequate or inappropriate care at shockingly high rates.


    Specifically, RAND's research shows that acute care for insured adults is appropriate only 53.5 percent of the time on average. In other words, about 46 percent of acute care is clinically incorrect. Similarly, about 43.9 percent of chronic care and 45.1 percent of preventive care is inappropriate according to accepted medical standards. Children receive 68 percent of recommended care for acute medical problems, 53 percent of recommended care for chronic medical conditions, and 41 percent of recommended preventive care.


    The bottom line is health care - whether for adults or children - is inappropriate or unnecessary about half the time. Basically, it's a coin flip.


    Root Causes of Poor Quality, High Costs:


    Ultimately, three immutable laws of economics explain the underlying causes of this poor performance:


    1. Price is what you pay but value is what you get:


    Taking a page from Warren Buffet's playbook, buyers of health benefits must focus on value, not price. Price is an important part of the equation but meaningless if you don't know the value of what you are receiving for that price. Unfortunately, in health care we obsess on unit prices. In no other marketplace or domain of life do Americans - corporations, consumers, federal and state policymakers, news media - pay so much attention to price and so little to value.


    2. You get what you pay for:


    Today, we pay for quantity, not quality. Poor performers are sustained and rewarded. The best performers are financially penalized and professionally demoralized. The consequences are all too obvious.


    3. You can't fix what you can't see:


    In sharp contrast to virtually every other industry, health care is highly opaque. American health care is full of decision makers - consumers, physicians, and other providers, health plans, public officials - who lack the information needed to make decisions.


    Five Steps to Higher Performance:


    The problems are daunting but solvable. To improve the quality and cost effectiveness of health care delivery, purchasers and payors must tightly focus on strategies to expect, measure, disclose, reward, and support results:


    1. Expect Results:


  • Set actionable performance expectations for health care providers, particularly physicians, clinics, hospitals, pharmacies, and long-term care providers.

  • Ensure that expectations are clear, decision relevant, and supported by evidence.

  • 2. Measure Results:


  • Rigorously measure clinical and economic performance compared to expectations.

  • Use consensus endorsed measures such as those adopted by the National Quality Forum.

  • However, don't let the perfect be the enemy of the good or analysis be the enemy of action.

  • 3. Disclose Results:


  • Publicly report the clinical and economic performance.

  • Ensure that reporting of performance is frequent and timely.

  • Use reader-friendly formats that support the differing decision making needs of consumers, providers, health plans, purchasers (employers, Medicare, Medicaid), and the media.

  • 4. Reward Results:


  • Directly align coverage, reimbursement, cost sharing, market share, contracting, utilization management, and other key policies with performance expectations.

  • Specifically, reward higher performance through monetary incentives (pay-for-performance or P4P), greater market share, public recognition, and regulatory flexibility.

  • Reward positive consumer behaviors through incentives like differential co-pays (e.g., low or zero co-pay to see the best physicians, very high co-pay to see poor quality docs).

  • 5. Support Results:


    Support the infrastructure and processes essential to results-driven health care. These include:


  • Evidence-based medicine and value-based benefit designs.

  • Patient-centered care, including stronger physician-patient communication, referrals, and genuine follow-up.

  • Chronic care management.

  • Modern health information technology, including electronic medical records, e-prescribing, and e-lab results.

  • Comparative effectiveness research.

  • Health services research to build our knowledge base on costs, quality, and access.

  • Education and training of physicians, patients, and family care givers.

  • posted: January 20, 2008

    Diabetes%20Studies%20in%20AJMC.jpgThe latest issue of the American Journal of Managed Care has several interesting articles on diabetes, demonstrating several opportunities to improve outcomes and reduce costs:


    How Managed Care Organizations Contribute to Improved Diabetes Outcomes: Patricia Salber, MD, chief medical officer and SVP at Universal American, a large Medicare health and drug plan, outlines how MCOs are improving outcomes for patients with diabetes.


    Diabetes Complications Severity Index and Risk of Mortality, Hospitalization, and Healthcare Utilization: This study show that the Diabetes Complications Severity Index (DCSI) performs better than complication counts and is a useful tool to predict mortality and hospitalization risk.


    Lower Severe Hypoglycemia Risk: Insulin Glargine Versus NPH Insulin in Type 2 Diabetes: Findings shows cost savings and lower incidence of hypoglycemia with insulin glargine.


    Diabetes Diagnosis, Resource Utilization, and Health Outcomes: Article highlights the clinical and economic case for much earlier detection of hyperglycemia.


    Do Diabetes Group Visits Lead to Lower Medical Care Charges?: Findings show that group visits (shared medical appointments) significantly reduce outpatient costs of diabetes care, primarily by substituting group visits for more expensive individual specialty care visits.


    To read or download all the articles in the January 2008 issue of AJMC, click here.

    posted: October 9, 2007

    Comparative%20Effectiveness%20Methods.jpgThe journal Medical Care has published series of outstanding articles on emerging methods and tools to compare the effectiveness of medical therapies, prescription drugs, and devices. The peer-reviewed articles are an outgrowth from a symposium on comparative effectiveness research sponsored by the Agency for Healthcare Research and Quality (AHRQ).


    Here are links to the individual articles in PDF format:


  • Emerging Methods in Comparative Effectiveness and Safety: Symposium Overview and Summary.

  • Medicare Part D Data: Major Changes on the Horizon.

  • Methodologic Challenges to Studying Patient Safety and Comparative Effectiveness.

  • Creating and Synthesizing Evidence With Decision Makers in Mind: Integrating Evidence From Clinical Trials and Other Study Designs.

  • Improving Depiction of Benefits and Harms: Analyses of Studies of Well-Known Therapeutics and Review of High-Impact Medical Journals.

  • Cluster Randomized Trials: Opportunities and Barriers Identified by Leaders of Eight Health Plans.

  • Design of Cluster-Randomized Trials of Quality Improvement Interventions Aimed at Medical Care Providers.

  • Designed Delays Versus Rigorous Pragmatic Trials: Lower Carat Gold Standards Can Produce Relevant Drug Evaluations.

  • Practice-Based Evidence Study Design for Comparative Effectiveness Research.

  • Studying Prescription Drug Use and Outcomes With Medicaid Claims Data: Strengths, Limitations, and Strategies.

  • Assessment of Adherence to and Persistence on Disease-Modifying Antirheumatic Drugs (DMARDs) in Patients With Rheumatoid Arthritis.

  • Out-of-Pocket Pharmacy Expenditures for Veterans Under Medicare Part D.

  • Developing Indicators of Inpatient Adverse Drug Events Through Nonlinear Analysis Using Administrative Data.

  • Real-Time Vaccine Safety Surveillance for the Early Detection of Adverse Events.

  • Evaluation and Overview of the National Electronic Injury Surveillance System-Cooperative Adverse Drug Event Surveillance Project (NEISS-CADES).

  • Using Inverse Probability-Weighted Estimators in Comparative Effectiveness Analyses With Observational Databases.

  • A Simulation-Based Evaluation of Methods to Estimate the Impact of an Adverse Event on Hospital Length of Stay.

  • Evaluating the Validity of an Instrumental Variable Study of Neuroleptics: Can Between-Physician Differences in Prescribing Patterns Be Used to Estimate Treatment Effects?

  • Heterogeneity and the Interpretation of Treatment Effect Estimates From Risk Adjustment and Instrumental Variable Methods: Surgery for Early-Stage Breast Cancer.

  • Increasing Levels of Restriction in Pharmacoepidemiologic Database Studies of Elderly and Comparison With Randomized Trial Results.

  • Use of Propensity Score Technique to Account for Exposure-Related Covariates: An Example and Lesson.

  • Using Propensity Scores Subclassification to Estimate Effects of Longitudinal Treatments: An Example Using a New Diabetes Medication.

  • Adjustments for Unmeasured Confounders in Pharmacoepidemiologic Database Studies Using External Information.

  • Comparison of Meta-Analytic Results of Indirect, Direct, and Combined Comparisons of Drugs for Chronic Insomnia in Adults: A Case Study.
  • posted: March 28, 2007

    Effective%20Health%20Care%20Program.jpgNormally, $15 million a year doesn't buy you much in the federal government. A notable exception is the Effective Health Care Program at the Agency for Healthcare Research and Quality (AHRQ). Drug manufacturers, device makers, health plans, state Medicaid agencies, Wall Street analysts, physicians, and patient groups should all follow it closely.


    The Medicare Modernization Act of 2003 (MMA) authorized AHRQ to conduct and support research on outcomes, comparative clinical effectiveness, and appropriateness of pharmaceuticals, devices, and health care services. With a modest budget, a tiny but dedicated staff, and partnerships with top research institutions, AHRQ's Effective Health Care Program involves three approaches to research the comparative effectiveness of different medical treatments, drug therapies, and clinical practices:


    1. Review and Synthesize Knowledge: AHRQ's network of 12 Evidence-based Practice Centers systematically review published and unpublished scientific evidence on what is known. Given the huge volume of studies and journal articles produced every year, it is next to impossible for providers, payors, and other key decision makers to keep up and even harder for them to thoughtfully weigh the evidence. AHRQ and its research partners synthesize the science and build a meaningful evidence base.


    2. Promote and Generate New Knowledge: The DEcIDE Research Network studies new scientific evidence and analytic tools in an accelerated and practical format. DEcIDE stands for "Developing Evidence to Inform Decisions about Effectiveness." Comprised of 13 university research centers and think tanks, the DEcIDE network conducts accelerated practical studies about the comparative clinical effectiveness, safety, and appropriateness of specific health care services, drugs, and devices. In other words, what works best for patients.


    3. Compile Findings and Translate and Disseminate Knowledge to Decision Makers: AHRQ's John M. Eisenberg Clinical Decisions and Communications Science Center takes the research results and transform them into into a variety of useful, actionable formats for stakeholders (e.g., providers, payors, purchasers, patients, manufacturers). Specifically, these include (a) consumer guides (short summaries of health care research that can help with decisions about treatments), (b) clinician guides (brief evidence summaries to assist clinical decision making), (c) policymaker guides (short reports of research evidence for use in health care policy making), and (d) white papers on state-of-the-art concepts in health communication.


    The past couple years, the initiative has focused on ten priority health care conditions, selected because of their high impact on Medicare, Medicaid, SCHIP, and other federal health programs:


  • Arthritis and non-traumatic joint disorders

  • Cancer

  • Chronic obstructive pulmonary disease and asthma

  • Dementia including Alzheimer's disease

  • Depression and other mood disorders

  • Diabetes mellitus

  • Ischemic heart disease

  • Peptic ulcer disease and dyspepsia

  • Pneumonia

  • Stroke and hypertension

  • Later this year, AHRQ will entertain nominations for other priority conditions.


    Here's a sampling of the excellent work already generated. For a directory of these reports, with free access in PDF format, click here:


  • Medication Therapy Management Programs in Medicare Part D Prescription Drug Plans

  • Comparative Effectiveness of Second-Generation Antidepressants in the Pharmacologic Treatment of Adult Depression

  • Efficacy and Comparative Effectiveness of Off-Label Use of Atypical Antipsychotics

  • Comparative Effectiveness of Management Strategies for Renal Artery Stenosis

  • Comparative Effectiveness and Safety of Analgesics for Osteoarthritis

  • Comparative Effectiveness of Epoetin and Darbepoetin for Managing Anemia in Patients Undergoing Cancer Treatment

  • Effectiveness of Noninvasive Diagnostic Tests for Breast Abnormalities

  • Comparative Effectiveness of Management Strategies for Gastroesophageal Reflux Disease

  • The Effective Health Care Program has 40 other reports in the works, covering a wide range of topics. These include more comparative effectiveness reviews of specific drugs as well as tools to measure quality, reduce errors, and monitor therapies. To get notified when new research becomes available, sign up for AHRQ's email list.

    posted: March 22, 2007

    Enhancing%20Drug%20Safety.jpgThe Enhancing Drug Safety and Innovation Act of 2007 (reintroduced as Senate Bill 484), sponsored by Senator Mike Enzi (R-WY) and co-sponsored by Senator Ted Kennedy (D-MA), is worth watching as the new Congress contemplates pharmaceutical industry legislation.


    As proposed, The Enhancing Drug Safety and Innovation Act of 2007 has five components:


    1. Amends the Federal Food, Drug, and Cosmetic Act to require an application for approval for a new drug or biological product to include a proposed Risk Evaluation and Mitigation Strategy (REMS). Designed to be an integrated, flexible mechanism to acquire and adapt to new safety information about a drug, REMS would require (a) labeling for the drug for use by health care providers; (b) submission of reports for the drug; and (c) a statement as to whether the analysis and surveillance are sufficient to assess the serious risks of the drug. REMS is modeled after the risk management approach taken by the European Union.


    2. Establishes a Drug Safety Oversight Board.


    3. Requires the Secretary of Health and Human Services to establish the Reagan-Udall Institute for Applied Biomedical Research as a nonprofit corporation to advance the Critical Path Initiative to modernize medical product development, accelerate innovation, and enhance product safety. Requires the Institute to have a Board of Directors. Allows the Board to coordinate and collaborate with other entities to conduct research, education, and outreach and to modernize the sciences of developing, manufacturing, and evaluating the safety and effectiveness of diagnostics, devices, biologics, and drugs.


    4. Amends the Public Health Service Act to require the Secretary, acting through the Director of the National Institutes of Health (NIH), to establish and administer a clinical trial registry database and a clinical trial results database. Requires a responsible party for a clinical trial to submit clinical trial information to the NIH Director for inclusion in the databases.


    5. Requires each individual under consideration for a term on an FDA advisory committee providing advice or recommendations to the Secretary regarding FDA activities to disclose industry financial interests.


    To learn more, check out the Senate Committee on Health, Education, Labor, and Pensions' hearing on the bill.

    posted: February 10, 2007

    State Health Reform.jpgIn health care, states serve as the nation's laboratories of reform - able to test innovations in financing, coverage, regulation, and care delivery. In 2007, states are leading the way on health insurance coverage expansion, leveraging a mix of policies including universal coverage, individual mandates, tax credits and Section 125 plans, and insurance "exchanges" or "connectors" to facilitate buying of affordable health plans.


    Because so much is going on and since I do a fair amount of workin this area, several readers of the Piper Report asked me to post some resources on what's going on in the states. So here you go.


    State Health Reform Commissions:


    Several states have created task forces or study committees to examine options for coverage expansion and make recommendations. Most are appointed by the governor or governor and legislative leaders. A few are special committees of the legislature. Here are states with health reform commissions:


  • Illinois
  • Colorado
  • Louisiana
  • Maine
  • North Carolina
  • New Mexico
  • New Jersey
  • Oregon
  • Vermont
  • Virginia (Governor's Commission)
  • Viginia (Legislature's Joint Committee)
  • Wisconsin

  • Governors' Health Care Reform Initiatives:


    Several governors have announced detailed health reform proposals. Most focus largely or entirely on coverage expansion but several also thankfully include initiatives to improve quality of care, combat medical errors, and/or increase transparency of provider prices and performance.


  • New York
  • California
  • Minnesota
  • Connecticut
  • Pennsylvania
  • Washington

  • More Resources on State-Based Health Reform:


    Massachusetts, of course, started the ball rolling with its groundbreaking, bipartisan reform initiative in 2006. To learn more, here's an excellent article from BNA's Health Policy Report on the impact of Massachusetts health reform on coverage expansion efforts in others states (PDF).


    The National Conference of State Legislatures (NCSL) maintains a helpful list of legislative bills on universal coverage proposed in states.


    For the best books on health reform, Medicaid, and other hot topics in health care, please visit my book recommendations.


    For latest state-specific data on health care coverage and spending, check out the free, easy-to-use tools on StateHealthFacts.org.


    Questions on State Health Reform:


    Feel free to contact me if you have questions on what's going on in the states.

    posted: December 9, 2006

    Negotiating%20Drug%20Prices.jpgThere's a lot of truth in the old joke about the problem with Republicans and Democrats: Republicans need a heart and Democrats need a brain. As Democrats prepare to take control of Congress, they appear eager to prove the joke by pursuing legislation to require government "negotiations" on prescription drug prices in Medicare Part D.


    The idea has emotional appeal, so let's see if there is any evidence to support the idea. (If you come from the Bumper Sticker School of Health Policy, stop here. The facts will only confuse you and don't easily make for emotive talking points.)


    Non-Interference Requirement in MMA:


    Price%20Negotiations.jpgIn the Medicare Moderation Act, the massive 2003 legislation that created the Medicare Part D drug benefit among other Medicare reforms, Congress prohibited the Centers for Medicare and Medicaid Services (CMS) from interfering with drug pricing in the competitive market. Part D prescription drug plans - Medicare Advantage drug plans (MA-PDs) and prescription drug plans (PDPs) - would battle among themselves to cut the best deals with pharmaceutical manufacturers and pharmacies and openly compete for enrollees.


    The statute at controversy, found at section 1860D-11(i) of the Social Security Act, is short and sweet:


    (i) NONINTERFERENCE. In order to promote competition under this part and in carrying out this part, the Secretary:

    (1) may not interfere with the negotiations between drug manufacturers and pharmacies and PDP sponsors; and

    (2) may not require a particular formulary or institute a price structure for the reimbursement of covered part D drugs.


    Estimated Savings of Federal Drug Price Negotiations:


    Drug%20Savings%20Unlikely.jpgSupporters of federal staff negotiating drug prices argue that it would generate billions of dollars in savings for taxpayers and seniors. However, the Congressional Budget Office (CBO) - the highly respected, non-partisan fiscal advisor to both houses of Congress and the agency that officially scores the cost and savings of all legislative proposals - agrees with top health economists and Medicare experts that federal price negotiations will save precisely zip.


    Following passage of MMA, Senate leaders asked CBO to examine the effect of striking the 'noninterference' provision. CBO reported:


    We estimate that striking that provision would have a negligible effect on federal spending because CBO estimates that substantial savings will be obtained by the private plans and that the Secretary would not be able to negotiate prices that further reduce federal spending to a significant degree. Because they will be at substantial financial risk, private plans will have strong incentives to negotiate price discounts, both to control their own costs in providing the drug benefit and to attract enrollees with low premiums and cost-sharing requirements.


    CBO was then asked if the federal government could save anything if CMS centrally negotiated prices with makers of single-source drugs. (Single-source prescription drugs are brand-name drugs that have no generic equivalent on the market and are generally available from only one manufacturer.) Again, CBO concluded that savings are unlikely, unless of course federal officials are willing to play hardball and restrict patient access to therapeutically unique drugs until the manufacturers agree to government price demands:


    Most single-source drugs face competition from other drugs that are therapeutic alternatives. CBO believes that there is little, if any, potential savings from negotiations involving those single-source drugs. We expect that risk-bearing private plans will have strong incentives to negotiate price discounts for such drugs and that the Secretary would not be able to negotiate prices that further reduce federal spending to a significant degree.


    Nevertheless, there is potential for some savings if the Secretary were to have the authority to negotiate prices with manufacturers of single-source drugs that do not face competition from therapeutic alternatives. Private plans offering a prescription drug benefit to Medicare beneficiaries will have less leverage in negotiating discounts for drugs without therapeutic alternatives than they have in price negotiations for drugs that do face such competition. (In that regard, the Medicare plans will be no different than private health plans that offer prescription drug coverage to other populations.)


    Under current law, there already are significant pressures that limit the prices that manufacturers charge for drugs - whether those drugs face competition from therapeutic alternatives or not. Those pressures include the prospects that plans will not cover a drug (or will substantially limit the amount they pay for a drug) and that manufacturers will provoke a backlash (potentially including legislation) if they set prices too high. Moreover, the creation of the Medicare drug benefit has given federal officials greater opportunity and incentive than under prior law to bring pressure on manufacturers - for example, by influencing public opinion and policy makers--if the prices that manufacturers set for single-source drugs that are not subject to competition from therapeutic alternatives are perceived as being too high. Giving the Secretary an additional tool--the authority to negotiate prices with manufacturers of such drugs - would put greater pressure on those manufacturers and could produce some additional savings.


    Ample Evidence Against Federal Drug Price Negotiations:


    Not only would federal price negotiations save little or nothing compared to the increasingly competitive private marketplace, there are host of other arguments against the idea.


    In a fascinating new study - The Human Cost of Federal Price Negotiations: The Medicare Prescription Drug Benefit and Pharmaceutical Innovation - Benjamin Zycher, Ph.D., an economist and senior fellow at the Manhattan Institute's Center for Medical Progress, carefully "estimates the impact that federal negotiation of prescription drug prices would have on pharmaceutical research and development (R & D) investment through 2025."


    Dr. Zycher concludes that, while federal price negotiations could save some Medicare dollars, "the longer-term human costs of government price-negotiation...are likely to be large and adverse." Most notably, the data show government mandated negotiations would dramatically reduce the development of new, life-saving drugs (about a dozen annually), resulting in "...a loss of 5 million expected life-years annually, an adverse effect that can be valued conservatively at about $500 billion per year, an amount far in excess of total annual U.S. spending on pharmaceuticals."


    In Compromising Quality: The High Cost of Government Drug Purchasing, Edmund F. Haislmaier provides a crisp, devastating critique of the idea of federal drug price negotiations. He disects the core myths and outlines how it would only serve to threaten quality and access.


    Proponents of government price negotiations assume that Medicare has more bargaining leverage than the private sector. In Why the New Congress Should Not Fix Drug Prices, researcher Greg D'Angelo does a nice job dismantling this faulty assumption.


    Wait, It Gets Worse:


    VA%20Drug%20Formulary.jpgMany advocates of federal negotiations point to the VA's prescription drug program as an example of how to reduce drug prices. As I have explained to many audiences, comparing the VA approach to Medicare Part D is not even an apples to oranges comparison. It's more like comparing apples and poodles - and makes as much sense.


    A groundbreaking study, by Frank R. Lichtenberg, Ph.D. of the Columbia School of Business, should put such comparisons to rest. In Older Drugs, Shorter Lives? An Examination of the Health Effects of the Veterans Health Administration Formulary, Dr. Lichtenberg shows the VH approach is not about prices or genuine negotiations. With the VA's tight budget, it is all about restricting veterans' access to new (and many old) medications to save dollars and hit budget targets.


    The VA's highly restrictive national formulary excludes 62% of drugs approved by the FDA during the 1990's and 81% of new medications approved since 2000. Even worse, the drug benefit designed for our nation's veterans does not pay for a staggering 78% of new, high-priority prescription drugs approved by the FDA on an expedited basis since 1997 because of their life-saving impact. By comparison, commercial health plans, Medicare Part D drug plans, and state Medicaid programs cover the vast majority of new drugs and move quick to add coverage for most drugs given fast-track by the FDA.


    Dr. Lichtenberg's 2005 study shows that the VA's prescription drug system - seen by many as the "model" for Medicare Part D - reduced the life span and survival rates of vets since its 1997 introduction. Note to Congress: Death is always cheaper than life but rarely preferable.


    Recap:


    Dangers%20of%20Price%20Controls.jpgSo, let's recap. Even putting aside the dangers of a massive increase in government power, fact it would dramatically reduce consumer and physician decision making, fact it would shift costs to other payors, and fact it would inevitably lead to economically disastrous price controls, the federal government negotiating drug prices will likely save little or nothing - unless Congress wants to severely restrict patient access to new and existing medications, thereby shortening lives, reducing quality of life, and increasing costs well beyond any savings. And that's if it's even feasible for CMS to do it. Trust me, it's not.

    posted: August 3, 2006

    Medicaid%20Transformation%20Grants.jpgIn the Deficit Reduction Act (DRA), Congress authorized the new $150 million Medicaid Transformation Grant Program to help states design and implement reforms to increase quality and efficiency of Medicaid. This is a unique opportunity to help states restructure and modernize Medicaid, save taxpayer dollars, and improve services. But states must act fast to take advantage.


    State Medicaid agencies may submit grant proposals to CMS by September 15, 2006. For grants, CMS has a total budget of $75 million in FFY 2007 and another $75 million in FFY 2008. The amount of each grant will vary and will depend on the number of applications received. State matching funds are not required.


    While states have wide discretion in proposing projects and may propose multiple projects in a single grant application, CMS is encouraging states to look at ways to improve Medicaid program operations and efficiency.


    In the area of improving Medicaid program efficiency, CMS is particularly interested in grant projects to:


  • Reduce waste, fraud, and abuse under Medicaid.

  • Improve collection rates in Medicaid estate recovery programs.

  • Reduce Medicaid prescription drug spending, especially for high cost drug categories, through education, incentives, and greater use of generic drugs.

  • CMS is also interested in projects to improve the effectiveness of Medicaid. Examples include projects on:


  • Reducing medical error rates and improving patient safety.

  • Advancing the use of electronic health records, clinical decision support tools, e-prescribing programs, and other system improvements.

  • Improving coordination of care through care management programs and other efforts to prevent complications and avoid duplicative or unnecessary services.

  • Pay for performance (P4P) programs or other performance-based incentives to reward and support high quality, evidenced-based care.

  • In the arena of improved care delivery, CMS is particularly interested in grant proposals to:


  • Promote personal control over services, with greater emphasis on prevention steps.

  • Improving access to primary and specialty physician care for the uninsured using integrated university-based hospital and clinic systems.

  • This is a unique, one-time opportunity for states but, with grant applications due in six weeks, the timeline is tight. States needing help or advice in writing an application may contact me or my friends at Sellers Feinberg for assistance.

    posted: July 5, 2006

    Patient%20Centered%20Care.jpgPatient-centered care - one of the new buzz phrases in health care - is all about aligning the delivery of medical care with the needs and preferences of patients. Research shows that the practices and tools of patient-centered care result in:


  • Superior clinical outcomes

  • Higher consumer satisfaction

  • Improved access to needed care

  • Reduction of inappropriate use

  • Lower healthcare costs

  • Unfortunately, despite overwhelming support of the medical community and patient advocates, only 22 percent of physicians practice patient-centered care.


    Patient-Centered Care Defined:


    Patient-centered care is one of the six essential components of high quality medical care, according to the Institute of Medicine (IOM), the respected healthcare arm of the National Academy of Sciences. The IOM defines patient-centered care as:


    Health care that establishes a partnership among practitioners, patients, and their families (when appropriate) to ensure that decisions respect patients' wants, needs, and preferences and that patients have the education and support they need to make decisions and participate in their own care.


    Key Components of Patent-Centered Care:


    At its core, patient-centered care is all about improved patient-provider communication, where patients and providers collaborate for the benefit of the patient. Ideally, patient-centered care delivery involves an array of tools and practices, including:


  • Strong continuity of care, including close communication between primary care physicians and specialists, careful "hand-off" of patients among providers, and thorough post-hospital, post-surgical support and follow-up.

  • Effective use of modern health information technology, including (a) electronic medical records, (b) electronic prescribing, (c) e-lab results, (d) online scheduling, (e) email communications, and (f) automated patient reminders.

  • Clinic management and procedures to ensure (a) effective medication therapy management, (b) timely appointments, (c) access to after-hours services, and (d) fast, easy patient access to medical records.

  • Tools and information to facilitate patient decision making, including (a) reliable, actionable information on provider performance (i.e., transparency of quality, cost, safety) and (b) information and self-management tools to help patients manage their own conditions.

  • To learn more, check out these resources:


    The Commonwealth Fund's excellent initiatives on patient-centered care.


    Report from the Economic and Social Research Institute on the key components of patient-centered care that are unique to underserved populations.


    Tools from the HHS Agency for Healthcare Research and Quality (AHRQ).

    posted: May 20, 2006

    Redefining Health Care.jpgThe world's leading guru of competitive strategy, Michael Porter, Ph.D., has turned his sights on explaining the fundamental cause of high costs, poor quality, consumer dissatisfaction, uneven access, and skyrocketing premiums in American health care.


    In Redefining Health Care, Porter and innovation expert Elizabeth Teisberg, Ph.D. provide a thoughtful, groundbreaking framework to use competition to drive dramatic increases in quality and efficiency.


    Unlike many wonks who foolishly believe that health care is not a market, Drs. Porter and Teisberg see competition " of a sort " in operation. They show us that the current competitive environment in health care is designed to "shift costs, accumulate bargaining power, and restrict services." That is, what we have now is dysfunctional, zero-sum competition serving to limit, even reduce value for patients. And they see all this taking place "...at the wrong level-among health plans, networks, and hospitals " rather than where it matters most, in the diagnosis, treatment, and prevention of specific health conditions."


    Focusing on how to move American health care to positive-sum competition based on economic and clinical value for patients, Redefining Health Care provides a series of specific recommendations for the key players " including physicians, hospitals, health plans, employers, Medicare, and Medicaid.

    posted: March 25, 2006

    Medical%20Errors%20and%20Medical%20Narcissism.jpgMedical errors are rampant in American health care, particularly in physician and hospitals services. The human and economic costs are extraordinary. And because these mistakes are virtually 100 percent avoidable, so are the deaths, injuries, pain, and cost.


    A diverse range of players - policy makers, thought leaders, researchers, consumer groups, purchasers, and clinicians - are working to reduce error rates and promote the use of safer systems and practices. However, reformers continue to hit the great blue wall of medical secrecy. Physicians, hospital administrators, and other health professionals are extremely reluctant to disclose or discuss a harm-causing mistake.


    This is not surprising, of course. No one likes to talk about his or her mistakes, especially mistakes that result in injury or death. These conversations are awkward and painful for all concerned. What's more, disclosuring the truth can lead to lawsuits, disciplinary action, embarrassment, self-doubt, and diminished status in society and among peers. But ethically, all this is beside the point. Patients and their surviving family have a right to the unvarnished truth, something they rarely get absent costly and protracted lawsuits. And the health care system cannot fix what it cannot see.


    Medical Errors and Medical Narcissism - a groundbreaking book by John Banja, PhD, assistant director of health services and clinical ethics at Emory University - examines the concept of "medical narcissism." Specifically, Dr. Banja explains why a health professional's need to preserve his or her self-esteem often robs patients and their families of the truth and perpetuates high-error medicine. He describes the "common psychological reactions of healthcare professionals to the commission of a serious harm-causing error and the variety of obstacles that can compromise ethically sound, truthful disclosure."


    In Medical Errors and Medical Narcissism, Dr. Banja explains how and why talented, hard working medical professionals often fall into narcissistic traps. Living in a world of intense stress, long hours, and high, often unfair expectations, the "medical narcissist" works hard to maintain the respect of patients and colleagues. As Dr. Banja says:

    When a medical error occurs, that world of competence, adequacy, and ability is turned upside-down. It is no wonder that even when such persons want to do the right thing and disclose error, they might do it clumsily and make an already bad situation worse.


    This fascinating, thoughtfully researched book includes detailed recommendations, including advice on how to:


  • Disclose errors "artfully and ethically," including words and phrases helpful in these delicate conversations.

  • Create a "moral atmosphere" in clinics and hospitals.

  • Reform tort laws to promote full, appropriate disclosure of medical errors.


    Medical Errors and Medical Narcissism is available at Amazon.com.


    To learn more about the issues involved in medical errors and quality, please check out my lists of recommended books on:

  • Health care quality and patient safety.

  • Medical errors.

  • Medical malpractice.

  • Evidenced-based medicine.

  • posted: January 14, 2006

    Medicare%20Part%20D%20Problems.jpgRube Goldberg believed there were two ways to do things - the simple way and the hard way. And that, for some inexplicable reason, many people preferred doing things the hard way. His famous cartoons illustrated the tendency of human beings to exert maximum effort to achieve minimal results.


    Notwithstanding the best of intentions, an influx of a mountain of taxpayer cash, the savings available to many low-income seniors, and the hard work of unfairly maligned federal staff, the Medicare drug benefit has become a Rube Goldberg cartoon.


    Since passage of the Medicare Modernization Act (MMA) in December 2003, I have been warning about predicable surprises and inevitable consequences. The good news is I am batting 1000 on predictions. The bad news is I am batting 1000 on predictions. If it were not for the fact real people are affected, I'd be happy to sit back and gloat about my prescience. Or perhaps hire a skywriter to paint "I Told You So" high above Security Boulevard.


    But truth is, this was easy to see and I was far from alone. While there are many flaws in the design of MMA and lost opportunities in the implementation, the most troubling problems revolve around the chaos and risks of transferring over six million vulnerable dual eligibles from Medicaid drug coverage to Medicare Part D. Virtually all of the other problems of Part D implementation can be ironed out with some more time, experience, and legislative tinkering.

    posted: November 6, 2005

    NIH Research Must Be Actionable.jpgAfter an avalanche of federal money the past ten years, the National Institutes of Health (NIH) is under pressure to show results. This is no small feat given the enormous scientific challenges of cancer, heart disease, HIV, and other killers and disablers. And even though NIH's budget more than doubled in recent years, less than five percent of government health spending goes to research into causes, treatments, and cures.


    In areas where NIH and the private research community is successful, we face another challenge - getting the results or evidence into practice. According to the Institute of Medicine, it takes an average of 17 years before a proven best practice is in wide spread use for the benefit of patients. In other words, patient care in 2005 is more often based on the best science as of 1988.


    Our nation's investment in health services research - which covers how to get evidence to practice and improve access, quality, and cost effectiveness of our $1.8 trillion health system - is worse. It hovers around one percent of what we spend on NIH. Medicare and Medicaid waste more in a single day than what we spend in a year on trying to improve program performance for patients and taxpayers.


    As the NIH works to demonstrate results for the taxpayers, we all need to recognize the symbiotic relationship between (a) basic and clinical research that creates new evidence and (b) health services research that shows us how to bring the evidence to the physician and patient. Right now our research system is like a auto manufacturer who spends all its money on engineering and testing new vehicles and virtually nothing on design, quality control, financing, cost management, distribution, training, sales, or marketing.


    Of course, the researchers must deliver. To do this, NIH and ARHQ in particular should support more actionable research. To be actionable, research must be:


    1. Timely: Better to have a good answer today than a perfect answer in a few years. All too often we allow analysis to be the enemy of action.


    2. Decision Relevant: Enough of preaching to the choir and hunting for tenure. Researchers must connect with real-world decision makers and answer their questions. Other than the Nobel Prize, virtually all other forms of recognition for research have little or nothing to do with work that is actionable.


    3. Translated: It's all about reaching decision makers and unfortunately most researchers are horrible communicators. What do you think, what do you know, what can you prove, what do you suspect? Say it in the context of decision makers and their challenges.


    4. Disseminated: Peer reviewed journals are great. I enjoy reading many of them. But most decision makers do not. You're lucky if they read the abstract. Disseminate findings in new ways to reach decision makers. Multiple mediums must be used and, if necessary, created.


    NIH's new Institutional Clinical and Translational Science Awards program is a great start in the right direction.

    posted: October 22, 2005

    Medicare Prescription Drug Data Sharing.jpgSophisticated health care purchasers and health plans know the value of prescription drug data. When analyzed with paid claims data from physicians and hospitals, data from pharmacy claims can be used to identify, understand, and track a wide range of issues.


    Starting January 2006, when the 6.5 million dual eligibles move from Medicaid to Medicare for their prescription drug benefits, state Medicaid agencies will no longer have access to data on drug use by these extremely expensive, at-risk beneficiaries - patients who drive over 40 percent of Medicaid costs. As a result, Medicaid managers will lose an invaluable source of information, severely handicapping the ability of states to monitor quality, access, and costs and catch waste, fraud, and abuse.


    The Centers for Medicare and Medicaid Services (CMS) lacks the legal authority to require Medicare prescription drug plans (PDPs and MA-PDs) share data with Medicaid. However, nothing precludes voluntary Rx data sharing between Medicare drug plans and states.


    Voluntary data sharing would be an easy, inexpensive way for Medicare drug plans to gain goodwill among states and advocates, generate positive publicity, and differentiate themselves from the mass of competitor plans. In addition, because dual eligibles may switch plans any time and multiple times each year, two-way data exchanges with states would aide drug therapy transitions, utilization review, and medication therapy management. Stand-alone PDPs, which are at risk only for drug costs and therefore will not have access to any non-drug data, could greatly benefit from data from state Medicaid programs (e.g., diagnoses, prescription history, providers seen)


    To help make this happen:


    - A major pharmaceutical manufacturer should offer to fund a national initiative to show the business and clinical case for information exchange, develop data sharing agreements, iron out any technical obstacles (e.g., data safeguards), and cover the modest start-up costs (e.g., systems changes). In addition to generating goodwill, this would help minimize disruption in drug therapy, quality problems, and errors - and reduce lost revenue and bad publicity that will inevitably result if duals have problems accessing vital medications.


    - In their standards for a Medicare drug plan to be designated as a preferred plan for low-income beneficiaries, State Pharmaceutical Assistance Programs (SPAPs) should require that preferred drug plans to exchange duals' Rx data with states.

    posted: September 24, 2005

    Medicare Advantage Special Needs Plans.jpgMedicare Advantage is the new name for voluntary managed care options in Medicare (also know as Medicare Part C and formerly "Medicare+Choice"). Medicare Advantage plans are now available in nearly every area of the country. Beneficiaries who select a MA plan elect to receive all Medicare benefits through the health plan (HMO or PPO). This includes all Part A and Part B services, plus the new Part D drug benefit as an optional add-on.


    The Medicare Modernization Act (MMA) created a Medicare Advantage option called "specialized MA plans for special needs individuals" ("special needs plans" or "SNPs"). These Medicare health plans limit their enrollment to special needs beneficiaries (or disproportionate percentage of special needs beneficiaries). The idea is to encourage greater access to Medicare Advantage plans for special needs individuals and allow plans to tailor programs to meet unique needs. MMA also created risk adjustment, removing a major disincentive to serve high-cost populations. Two groups of special needs individuals are specified in MMA: (1) beneficiaries who are institutionalized and (2) dual eligibles. CMS may also establish other "special needs" groups among beneficiaries with severe or disabling chronic conditions. Like other Medicare Advantage plans, special needs plans have the ability to lower beneficiary cost sharing and cover services not available to beneficiaries in fee-for-service Medicare.


    This creates a new opportunity for state Medicaid programs to extend the benefits of managed care to dual eligibles, who nationwide account for over 40 percent of Medicaid costs. Because of a labyrinth of conflicts between federal Medicare and Medicaid laws, it has been very hard for states to implement large-scale programs to improve care delivery for their highest cost, most vulnerable beneficiaries. The result has been high costs, extraordinary inefficiency, frustration for patients and their families, and higher risk for poor quality.


    Working with CMS and Medicare Advantage special needs plans (MA-SNPs) operating in the state, a state Medicaid agency could offer to capitate all Medicaid services to any MA-SNP with dual eligible enrollees. The MA-SNP would then be responsible for all Medicare and Medicaid benefits, including all long-term care and prescription drug benefits. To ensure appropriate payment and oversight, the state would risk adjust the Medicaid side of the capitation and MA-SNPs would have one set of quality standards and grievance procedures (presumably based on the more stringent Medicaid protections). Enrollment would remain voluntary like it is for other Medicare beneficiaries, but states could create powerful incentives for duals to enroll in MA-SNPs. For example, the state could limit coverage of home- and community-based services (HCBS) to MA-SNP enrollees when two or more MA-SNPs are available.


    Beneficiaries would benefit from higher quality, better access (in real terms), modern care coordination, less paperwork, closer oversight of their rights, and likely more services. States would win from a range of benefit and administrative savings, plus more predictable spending.


    For a fact sheet on Medicare Advantage, click here. To learn about plans, enrollment, and other key issues, click here.

    posted: September 17, 2005

    Physician Drug Prescription.jpgOnce the Food and Drug Administration (FDA) approves a new prescription drug for one medical indication, physicians are free to prescribe it for virtually any condition. While there are downsides of prescribing drugs "off-label," it allows patients and payors to benefit as physicians test drugs under real-world conditions and identify new applications.


    Because formal clinical trials and the FDA review process can take years, valuable new uses of a drug may be validated by studies in peer-reviewed medical journals years before the new indication becomes officially approved. And because of research and regulatory costs, drug makers cannot justify pursuing FDA approval for new indications, even when a new indication is highly cost-effective for purchasers, plans, and patients. Indeed, some diagnoses have no "on-label" drugs and are treated entirely on an off-label basis.


    With the new Medicare drug benefit (Medicare Part D), the federal government will become the world's largest buyer of prescription drugs. In Part D, a prescription drug is coverable by a Medicare drug plan (PDP or MA-PD) only if it is prescribed for a medically accepted indication as defined under federal Medicaid law. This includes uses that are approved by the FDA or supported by a citation in one of four drug compendia:


    · American Medical Association Drug Evaluations
    · American Hospital Formulary Service Drug Information
    · DRUGDEX Information System
    · United States Pharmacopeia Drug Information


    Because of this restriction in the Medicare Modernization Act, indications that are supported in peer-reviewed medical literature but not yet approved by the FDA or accepted in one of the compendia are not "medically accepted" by Medicare. In such cases, the Medicare drug plans may not pay for the drug.


    While this helps Medicare drug plans manage their financial exposure and allows them to crack down on inappropriate drug therapy, it also means that it'll be harder for physicians to identify valuable new uses of medications. As we loose this critically important path to expanding our evidence base, patients and the economy will suffer.


    This is yet another reason why we need a comprehensive approach to post-market surveillance and assessment of prescription drugs, continuous improvement of the evidence base of what works, and more effective ways to bring that evidence to day-to-day clinical practice.

    posted: May 27, 2005

    Inside the Food and Drug Administration (FDA).jpgInside the FDA: The Business and Politics Behind the Drugs We Take and the Food We Eat is a thoughtful, balanced, and well-researched look inside controversial and troubled Food and Drug Administration.


    Author Fran Hawthorne is an experienced business journalist and her skills are evident here. Digging into the FDA�s complex and conflicting world, the book provides an informative picture of FDA�s bureaucratic, political, and scientific drivers. Ms. Hawthorne does a nice job of laying out what the FDA is suppose to do, what is really does, and where and why it fails.


    Inside the FDA helps us understand the recent raft of problems surrounding the over- and mis-regulation of prescription drugs. It makes for a great read. To read a excerpt, click here.

    posted: May 22, 2005

    Puzzle of State Health Reforms.jpgStates continue to serve as laboratories for health care reform. In recent years, many of these state-based efforts have focused on:


    1. Leveraging Employer-Based Coverage: With the goal of making health insurance coverage more affordable to small businesses and their employees, state tools include (a) premium assistance, (b) reinsurance to moderate high-risk cases, (c) state negotiated health plan options, and (d) hybrids mixing taxpayer and employer-sponsored models.


    2. Pharmaceutical Purchasing: To improve the cost-effectiveness of prescription drug benefits, state-based reforms include (a) intra-state and multi-state purchasing pools, (b) negotiated discounts for low-income populations, and (c) evidence-based coverage combining preferred drug lists (PDLs) and supplemental rebates from pharmaceutical manufacturers.


    3. Care Management for High-Cost Patients: With over 75 percent of Medicaid costs driven by a small proportion of patients, states are developing new programs based on the latest care and disease management techniques.


    4. Modernizing Uncompensated Care Programs: While taxpayers invest billions of dollars each year to help compensate hospitals for serving uninsured patients, most of these efforts are blunt, highly inefficient programs with misaligned incentives. Therefore, some states are exploring alternatives designed to leverage these funds to promote primary care.


    To learn more about state-based reforms, including lessons learned, check out the work of our friends at the Economic and Social Research Institute (ESRI). ESRI�s excellent team, with support from the Commonwealth Fund, has a series of informative reports.

    posted: May 6, 2005

    In Case of Emergency, Push Button.jpgQuality of care in the federal Medicare program remains poor. New evidence shows a wide range of serious, often worsening problems in the physician and hospital care received by Americas 41 million Medicare beneficiaries.

    The bad news includes (1) increases in preventable medical mistakes; (2) inadequate screening and treatment of colorectal cancer, hypertension, depression, high cholesterol, and urinary incontinence; and (3) wide, unjustified geographic and racial disparities in quality of care received.

    There is some good news, including more preventive services and modest improvements in inpatient care of heart attacks and outpatient care of diabetes.

    Medicare, of course, does not operate in a vacuum. Medicare beneficiaries suffer from the consequences of poor quality, inefficiency, and outdated systems just like the rest of us. The costs in lost lives, suffering, and wasted dollars are staggering. And while progress is slow, Medicare has begin several initiatives to improve care.

    posted: May 1, 2005

    Elderly Woman in Wheelchair in a Sunny Room.jpgThe new Medicare prescription drug benefit presents many challenges to the nation's seven million dual Medicare-Medicaid eligibles. On January 1, 2006 they must move from broader, more flexible Medicaid drug coverage to the narrower, extraordinarily complex Medicare drug benefit. Among those in jepordy are about a half million frail seniors and severely disabled persons served by state home- and community-based waiver programs.


    State Medicaid programs offer a range of home- and community-based services to help frail seniors and severely disabled individuals avoid costly institutionalization. Of course, adequate drug coverage is essential to this effort. Most individuals enrolled in these programs are dual eligibles and thus face dramatic changes in their drug benefits.


    An excellent new report discusses the impact of Medicare Part D on this subset of dual eligibles. The author, Chuck Milligan, JD, MPH, is a highly respected Medicaid and long-term care guru. Formerly vice president at The Lewin Group and New Mexico Medicaid director, he's executive director of the Center for Health Program Development and Management at the University of Maryland, Baltimore County (UMBC). Chuck offers several thoughtful recommendations:


    ● Allow states to dispense 90-day prescriptions in December 2005 with full federal matching funds.

    ● Allow Medicaid to share drug information with the Medicare prescription drug plan as soon as auto-enrollment is finalized.

    ● Require Medicare prescription drug plans to honor a beneficiary?s existing pharmacy regimen until an in-network physician develops a new care plan.

    ● Require Medicare prescription drug plans to offer dual eligibles open formularies or Medicaid-equivalent formularies during the first six months to a year.

    ● Allow states to pick up the cost of noncovered drugs with full federal matching funds and be eligible for a credit to the state ?clawback.?

    ● Lengthen the period for auto-enrollment.


    Please also check out the Piper Report's recent story on the risks of Part D to nursing home residents.

    posted: March 7, 2005

    Prescription Pills on Pharmacy Counter.jpgNew evidence on the high incidence of preventable, often deadly drug errors in nursing homes raises serious implications for the new Medicare prescription drug benefit.


    Each month, one in ten nursing home residents suffer a medication-related injury, according to a new study in the American Journal of Medicine. The lead author, Jerry H. Gurwitz, MD from the University of Massachusetts Medical School, is a top expert on the safe use of drugs by seniors.


    Extrapolating to the 1.6 million nursing home residents, the study suggests a staggering 1.9 million medication errors each year - including over 86,000 fatal or life-threatening mistakes. These scary new figures, still considered conservative, indicate the problem is five times worse than previously believed. To read the study, click here (PDF).


    Under the new Medicare prescription drug benefit, most nursing home residents face dramatic changes to their drug benefits starting January 1, 2006. While some aspects of the Medicare drug benefit may ultimately help improve care, the highly complex Medicare program will likely exacerbate the problem of medication errors.


    Some key factors to consider:


    1. More restrictive formularies: The drug formularies offered by the Medicare drug plans will be far more restrictive than state Medicaid formularies. For many nursing home residents, this will mean changes to drug therapy regimens.


    2. More complex drug management: It's unlikely that all of a facility's residents will be enrolled in the same drug plan. Therefore, nursing homes face the challenge of navigating multiple formularies and benefit procedures. In addition, the Medicare drug plans will likely force significant changes to nursing home?s long-established relationships with the specialty pharmacies that know and serve this market.


    3. Misaligned financial incentives: Most Medicare beneficiaries in nursing homes will be enrolled in brand-new kind of creature, i.e., stand-alone drug plans that are at financial risk only for the drugs. This is in sharp contrast to health plans (HMOs, PPOs) which are at risk for all care and therefore have a built-in incentive to maintain a safe, therapeutically sound drug benefit to guard against hospitalizations and other more costly events. Because of the serious misalignment of incentives and the potential for cost-shifting and other gaming, no employer or Medicaid program would ever consider a similar at-risk carve out of drug benefits.

    posted: February 2, 2005

    Hospital Outside - Cartoon.jpgA new breed of physician is coming to a hospital near you: the hospitalist. And they hold tremendous promise for improving quality and lowering costs.


    Hospitalists, who specialize in caring for hospitalized patients, are specially trained to effectively diagnose and treat high-acuity patients. Assuming primary responsibility for managing medical and surgical patients, hospitalists also help determine admissions from emergency departments and keep the patient's office-based docs in the loop.


    While traditional office-based physicians visit hospitalized patients before or after office hours, hospitalists are onsite and immediately accessible to patients and their families. A fulltime hospitalist can care for ten times the number of inpatients than an office-based physician.


    Supported by an array of new information management technologies, evidenced-driven protocols, and a team-based approach to care, the hospitalist model dramatically improves clinical decision-making. When done right, this translates to fewer medical errors, better patient outcomes, and lower costs from shorter stays and fewer re-admissions.


    The hospitalist model is gaining attention among cost and quality conscious employers, health plans, and hospitals. Hospital services represent some 40 percent of health spending and physician decisions direct more than 80 percent of hospital services.


    An excellent new study by the Center for Studying Health System Change says "Mounting financial pressures, increasing problems with patient flow in hospitals, a growing focus on patient safety, and rising malpractice costs..." are increasing use of the hospitalist model.


    The number of hospitals increased from a few hundred in the mid-1990s to more than 8,000 in 2003, according to the Society for Hospital Medicine, the professional society of hospitalists.

    posted: December 23, 2004

    As a tool to control costs and improve care for vulnerable patients, disease management is now used in some form by over half of all state Medicaid programs. To help states craft their disease management programs, a variety of technical resources are now available.


    The National Pharmaceutical Council offers a series of reports detailing best practices and evidence-based protocols for disease management for:


    Asthma.

    Diabetes.

    Chronic obstructive pulmonary disease (COPD).

    Congestive heart failure.

    Depression.

    Schizophrenia.


    They also offer an online decision support system to help state Medicaid directors select priority diseases for disease management programs.


    The Disease Management Association, which represents DM organizations and consultants in the industry, offers a journal and conferences to keep up on the latest practices.

    posted: December 12, 2004

    Pay Here Sign.jpgThe pay-for-performance (P4P) movement continues to grow:


    1. The Medicare Payment Assessment Commission (MedPAC) is calling on Congress to incorporate quality incentives in Medicare payments to hospitals, physicians, and home health agencies. In 2003, MedPAC released similar P4P recommendations for Medicare managed care plans and dialysis facilities. MedPAC says the Centers for Medicare & Medicaid Services (CMS) should earmark between 1% and 2% of Medicare payments to pay bonuses to providers that meet specific quality measures. The quality incentives would into account the severity of patients' illnesses.


    2. The Joint Commission on Accreditation of Healthcare Organizations (JCAHO) released principles for constructing pay-for-performance programs to align provider reimbursement with quality of care.


    3. The American Medical Association released a new report to get physicians ready for pay-for-performance. The report says pay-for-performance is a "tsunami building offshore in a sea of stakeholder unrest, threatening those who are not prepared."

    posted: December 10, 2004

    Financial Risk - Dice - 2.jpgPrescription drug utilization varies dramatically among individuals. To make sure Medicare payments to Prescription Drug Plans (PDPs) reflect the health status of enrollees, the Centers for Medicare & Medicaid Services (CMS) is developing a risk adjustment methodology. Risk adjustment is a statistical process used to identify and adjust for variation in patient costs that stem from differences in key risk factors - each a demographic or diagnostic characteristic of the patient.


    The CMS methodology, which is mandated by the Medicare Modernization Act (MMA), will use various inputs ? age, sex, disability status, and diagnoses ? to create a reasonable estimate of a PDP?s cost liability. Risk adjustment will result in more fair and accurate drug plan payments and help ensure access for the most vulnerable beneficiaries.


    For PowerPoint slides on CMS? planned approach, click here.

    posted: December 3, 2004

    Pills Spilled.jpgUnder the new Medicare prescription drug benefit, drug plans will have a fair amount of discretion in setting formularies. The idea is to encourage competition among drug plans and offer Medicare beneficiaries choice. The Centers for Medicare & Medicaid Services (CMS) will review the benefit designs of drug plan bidders to ensure the beneficiaries have appropriate access to needed drugs.


    CMS has released draft guidelines for reviewing prescription drug plan formularies. CMS' strategy for drug benefit review is designed to promote "appropriate operation of beneficiary protections and formulary oversight that includes access to all Part D covered drugs, while providing flexibility in plan design as expected under the Medicare Modernization Act (MMA)." Public comments are due by Thursday, December 30, 2004.


    CMS also released a helpful fact sheet that summarizes the formulary review process.

    posted: November 21, 2004

    Empty Hospital Corridor.jpgCommunity hospitals outperform teaching hospitals, according to a new study that compares cost and quality of hospitals in six states. The researchers conclude that patients served by lower-cost community hospital for secondary care receive care of similar quality to that provided in academic health centers.


    Findings include:


    - Inpatient costs per case are 19 percent higher in teaching hospitals, even after even after adjusting for patient case mix, severity, and other controllable characteristics.


    - Community hospitals and academic health centers are comparable in their frequency of poor clinical outcomes.


    - In terms of the likelihood seven adverse outcomes, the teaching hospitals were best on two and the community hospitals outperformed on three. There was no meaningful difference in two of the adverse outcomes.


    - Lengths of stay in the two kinds of facilities are virtually the same.


    The study, released by the Pioneer Institute for Public Policy Research, has implications for consumer-driven health plans. As consumers become more sensitive to the cost of care, the superior performance of community hospitals - at least for common secondary conditions that represent the greatest volume of inpatient care - will present new challenges to teaching hospitals and their affiliated clinical programs.


    The study was authored by Nancy M. Kane, DBA of the Harvard School of Public Health, Jack Needleman, Ph.D. of the UCLA School of Public Health, and Liza Rudell of MassHealth.

    posted: October 29, 2004

    A Bright Idea.jpgMedicaid health plans are the Ginger Rogers of managed care. They have to do everything commercial and Medicare health plans do but have to do it backwards and in high heels. Despite dealing with more complex requirements and the toughest, most vulnerable patient populations, Medicaid health plans often provide higher quality and better access to care than their commercial counterparts.


    To reward the highest performing health plans, state Medicaid agencies are increasingly using a new tool - performance-based auto-assignment. Auto-assignment is when new Medicaid beneficiaries are automatically assigned to a health plan when they don't voluntarily select a plan within the required time frame. While a state may simply assign new patients randomly among available plans, it may also use auto-assignment to incentivize the best health plans with increased enrollment. The better the perform, the greater the plan's proportion of auto-assigned enrollees.


    Michael Bailit, CEO of Bailit Health Purchasing LLC and a leading expert on Medicaid and employer managed care, says for auto-assignment to work as an incentive additional assignment volume must be desired by the health plans. States must also:

    - Establish clear goals at the outset and involve stakeholders early in the process.
    - Focus on data that is reliable and measures that can be audited.
    - Revisit measures on a regular basis and view the algorithm as something that is modifiable.
    - View auto-assignment as an incentive strategy that can be use in complimentary fashion with other incentive strategies.


    With the help of Bailit Health Purchasing, California Medicaid (MediCal) is developing a performance-based auto-assignment program. Starting in 2005, MediCal will use the approach to reward health plans with superior performance (relative to other health plans in the county), create a quality improvement incentive for all plans, and support the preservation of the safety net. Medicaid programs in Michigan and New York state already have experience using auto-assignment to drive quality improvement.


    When the new Medicare prescription drug benefit begins in January 2006, 7 million dual eligibles (persons enrolled in both Medicare and Medicaid) will receive their drug benefits through prescription drug plans (PDPs). If they don't select a PDP, Medicare will auto-assign them into a plan. Given the positive experience of state Medicaid programs, Medicare may wish to consider using performance-based auto-assignment to help drive drug plan quality.

    posted: September 11, 2004

    Quality Health Care Book Cover.jpgThere is ample evidence America has a serious problem with poor quality health care and high rates of preventable medical mistakes.


    Thankfully, there is no shortage of caring professionals motivated to improve care and the problems are solvable. As with any effort to improve performance, measurement is the first step to improving care and reducing medical mistakes. As I often remind clients and colleagues: you can't fix what you can't see.


    However, measuring hospital and physician quality is complex. And too often efforts to measure quality get bogged down - perfect becomes the enemy of good and analysis becomes the enemy of action.


    Quality Health Care: A Guide to Developing and Using Indicators serves as an excellent, up-to-date guide on how to design and implement an effective quality measurement program, particularly in hospitals. While paying close attention to the importance of clinically sound measurement, this guide focuses on providing practical and actionable advice. Specifically, the book provides:


    1. Helpful overview on quality measurement, the increasing demands of consumers and purchasers for public disclosure of provider quality, and the information consumers find most valuable in their decision making.


    2. Practical advice on how to select quality indicators, collect and organize data, and create a dashboard to monitor progress.


    3. Technical guidance on how to analyze data effectively, including how and when to accept limitations and variations.


    4. Cases studies on how to use quality measurement to improve both clinical and operational performance.


    The author, Robert Lloyd, PhD, is executive director of performance improvement at the Institute for Healthcare Improvement and a highly regarded expert in quality measurement.

    posted: September 11, 2004

    BerwickEscapeFireBook.gifEscape Fire is collection of compelling speeches by one of America's leading crusaders for health care quality and patient safety - Don Berwick, MD, founder and president of the Boston-based Institute for Healthcare Improvement.


    Each year, IHI hosts the National Forum on Quality Improvement in Health Care. The influential annual event draws 4,000 health care leaders from around the world in person and 6,000 via satellite.


    In many ways, Dr. Berwick's keynote lectures set the tone for quality improvement efforts across the US. With an effective blend of common sense, real-life stories, persuasive metaphors, and out-of-the-box thinking, Dr. Berwick's presentations make for fascinating reading for anyone interested in improving America's $1.7 trillion health care system.


    For example, in his 1999 keynote, Dr. Berwick recounts the 1949 Montana wildfire that killed thirteen young men and applies lessons learned from the catastrophe to today's health care system.

    posted: September 11, 2004

    Checking Temperature.jpgIn the typical hospital, nurses spend only about 30 percent of their time on patient care. The remaining 70 percent of their long days are spent largely on paperwork. This lopsided situation is seen as a major cause of poor quality, patient dissatisfaction, nurse turnover, and operating inefficiency.


    Thanks to the ideas of the Institute for Healthcare Improvement and funding from The Robert Wood Johnson Foundation, a dozen of the nation's most innovative hospitals are studying ways for nurses to spend the bulk of their time taking care of patients.


    Transforming Care at the Bedside, a two-year pilot program, is designed to improve the patient-caregiver relationship. The effort will look at practical ways to reduce paperwork, improve teamwork among nurses and physicians, reduce medication errors, increase the quality of bedside care, and increase job satisfaction and retention.

    posted: September 4, 2004

    US Currency Background Colorful.jpgTo address the enormous deficiencies in quality of health care, health care organizations need to make a business care for improvement. That is, they need to demonstrate a compelling rationale for the significant financial investments necessary to improve quality and reduce medical errors.


    To make decisions, businesses traditionally look at the potential return on investment (ROI). However, ROI projections are tough to make in health care. Data sources are limited and decision support tools are often outdated or nonexistent. Most health services research is purely academic, offering no actionable or timely advice to decision makers. The fragmented delivery system means that organizations that invest in performance improvement benefit other players more than themselves. Finally and most critically, incentives are terribly misaligned. Providers are paid for how much they do, not how well they do it. When patient care improves and medical mistakes decline, provider revenues can drop like a stone.


    The savvy folks at Bailit Health Purchasing LLC offer a new framework for building a business care to invest in quality improvement. In an excellent new issue brief published by The Commonwealth Fund, Michael Bailit, MBA and Mary Beth Dyer, MPP provide a mechanism for an organization to consider a broad set of factors affecting a business case for quality.


    Taking into account key financial, strategic, and organization factors, they offer 10 practical business care arguments. By looking beyond bankable dollars, hospitals, clinics, and other providers can create compelling business cases to improve their performance.

    posted: August 15, 2004

    One Hundred Dollar Bill.jpgIn Medicaid, health plans save money and improve quality of care. While this is no surprise for state Medicaid execs, the mounting evidence of HMO performance in Medicaid is in sharp contrast to public and media perceptions.


    In a carefully analysis of 14 studies, The Lewin Group found that "In the overwhelming majority of cases, the state Medicaid managed care programs were found to have improved Medicaid beneficiaries access to services, and both the programs and individual MCOs have earned high satisfaction ratings from enrollees."


    Overall, compared to fee-for-service, Medicaid health plans typically save taxpayers between 2 and 19 percent. In Medicaid HMOs, prescription drug costs are 10-15 percent lower and preventable inpatient admissions are 25-38 percent lower.


    While the AHIP-sponsored analysis focused on cost savings, The Lewin Group found ample evidence that Medicaid managed care programs improve access and quality.

    posted: July 30, 2004

    Sign to Emergency Room (Web).jpg
    In a new study, HealthGrades, a respected leader in measuring and reporting health care quality, estimates that preventable hospital mistakes kill 195,000 Americans each year. That's twice the Institute of Medicine's 1999 estimate, which many experts observed was conservative.


    Fortunately, some courageous hospitals are showing their peers how to improve clinical outcomes at reasonable cost. A new report describes the key factors contributing to the success of four high-performing hospitals. In it, my friend Jack A. Meyer, Ph.D. and his colleagues at the Economic and Social Research Institute and The Severyn Group offer an outstanding blueprint for improving patient care and safety in hospitals.


    The study, which was commissioned by The Commonwealth Fund, recommends 18 specific actions hospitals should take to improve patient care and save lives.

    posted: July 11, 2004

    Three Docs.jpgPreventable medication mistakes in hospitals is a leading causing of death. Top patient safety experts and The Leapfrog Group have called upon hospitals to replace risky, paper-based prescriptions with computerized physician order entry (CPOE) systems.


    If installed in every major hospital, CPOE systems would save tens of thousands of lives each year. However, few hospitals have CPOE systems and few plan to get them any time soon. In addition to costing $3-10 million per facility, hospital execs often face stiff resistance from docs unwilling to learn, replace their Rx pads with Palm Pilots, and work as teams. Even worse, because facilities are paid for quantity and not quality, improved patient safety often lowers a hospital's revenue (fewer errors = fewer patient days = lower revenue).


    Harvard Medical School researchers Eric G. Poon, David Blumenthal, and colleagues recently interviewed senior managers in 26 hospitals to identify ways to overcome barriers to adopting and implementing CPOE. Their thoughtful, on-target recommendations appear in the latest issue of Health Affairs.


    Solutions, not unexpectedly, include financial incentives to hospitals, stronger hospital and physician leadership, greater public attention to patient safety, establishing more uniform data standards, and modernizing hospital IT infrastructures.


    For further reading on savings lives through improved technology, check out my reading lists on:

    - Health care quality.

    - Medical errors.

    - Health care information technology.

    - Electronic medical records.

    posted: June 13, 2004

    Gavel with Steth.jpgA South Carolina surgeon has asked the American Medical Association to approve a national policy permitting physicians to deny medical treatment to malpractice attorneys, according to NPR's Morning Edition.


    This is the latest in a series of controversial steps by some physicians to blacklist patients and trial lawyers.

    posted: June 8, 2004

    Man in Blue with Eye Exam.jpgIf the doctors cure
    then the sun sees it.
    If the doctors kill
    then the earth hides it.
    The doctors should fear arrogance
    more than cardiac arrest.

    posted: May 29, 2004

    Med Symbol Over.jpgThe June 2004 issue of the Harvard Business Review contains an outstanding article on Redefining Competition in Health Care by Michael E. Porter, Ph.D. of the Harvard Business School and Elizabeth Olmsted Teisberg, Ph.D. of the University of Virginia's Darden School of Business.


    Their carefully researched, well-argued, actionable recommendations include:

    - Standardized information about individual diseases and treatments should be collected and disseminated widely so patients can make informed choices.

    - Purchasers, providers, and health plans should establish transparent billing and pricing to reduce cost shifting, confusion, pricing discrimination, and a host of other inefficiencies.

    - Providers should be experts in specific conditions and treatments rather than try to be all things to all patients.


    posted: May 23, 2004

    Surgeons Looking at Patient.jpgCanada's Socialized health care system may result in cheaper drugs but far more dead patients.


    The first major study of patient safety in Canadian hospitals has found an extremely high number of preventable medical errors.


    posted: May 22, 2004

    Two Women at Desk.jpg Consumer-driven health care - new models and technologies to empower consumers to make informed choices - is growing in popularity. At it's core, consumer-driven health care is all about transparency of costs and quality of care, and giving consumers the tools and information they need.


    To learn more, check out the best books on consumer-driven health care, including Regina E. Herzlinger's excellent new book. Read it first.

    posted: May 22, 2004

    Watch Your Step - Web.jpg Preventable medical mistakes and inappropriate, outdated medical care is the third leading cause of death in America, according to the Institute of Medicine and other experts.

    Consider This
    In ancient China, physicians were paid only when their patients were kept well and often not paid if the patient got sick. If a patient died, a special lantern was hung outside the doctor's house. Upon each death, another lantern was added. This is the first known use of the two most powerful drivers for health care performance - incentives and transparency.
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