Health Affairs

Millions more Americans are expected to join the ranks of the insured in 2014 under the Affordable Care Act (ACA) — and with the expansion in coverage will come additional expense. Even so, the rate of spending growth in the health sector will head in the opposite direction, continuing a slowdown that has lasted well beyond the 2009 recession.

In its eight annual report on health spending, PwC’s Health Research Institute (HRI) projects that 2014 medical cost trend will be 6.5 percent–a full percentage point lower than our estimate of 7.5 percent for 2013. Taking into account typical adjustments to benefit design such as higher deductibles, HRI projects a net growth rate of just 4.5 percent. That’s encouraging news for the people and companies purchasing care but presents enormous challenges for a sector already feeling a financial squeeze.

The recession and slow economic recovery have clearly affected health care spending. But we have identified other factors. More efficient care delivery combined with creative cost-reduction efforts by employers and the health industry, have acted to dramatically slow what had been double-digit growth for the sector. Early elements of the ACA are beginning to nudge down payments. What we don’t know yet is whether this slowdown represents early signs of the move away from fee-for-service medicine or merely the latest squeeze on the spending balloon in which costs pop up elsewhere. Read the rest of this entry »

If primary care is the foundation of the evolving health care system in this country, and if access to primary care for all is the goal, then nurse practitioners will be increasingly crucial to achieving these aims. Let’s face it, in our current system, there just aren’t enough primary care providers to meet the nation’s need while containing costs and focusing on quality outcomes. With an estimated 30 million more people who will be covered and require access to full primary care based on the Patient Protection Affordable Care Act (ACA) numbers, we will need additional providers functioning to their fullest preparation.

2013 National Resident Matching Program Data

The 2013 National Resident Matching Program (NRMP) released in March is not good news for primary care. Although matching rates were up overall, the primary care numbers are still very low given the national need. According to the American Academy of Family Physicians (AAFP, 2013), only an additional 92 U.S. graduate medical students were matched to primary care specialties compared to a year ago. That translates to 39 more family medicine resident positions filled, 14 more internal medicine positions, 3 more pediatric and 36 pediatric/internal medicine positions filled, compared to 2012. The bottom line is 1,916 U.S. medical school grads were matched to primary care residency programs, with a total of 3,715 primary care matches when international graduates are included (AAFP,2013; NRMP, 2013) .

Primary Care Nurse Practitioner 2012 Graduation Rates

At the same time, the 2012 nurse practitioner (NP) graduation rates announced recently by the American Association of Colleges of Nursing and the National Organization of Nurse Practitioner Faculties (AACN/NONPF 2013) showed a continued increase in primary care. Primary care NP graduates include those prepared as pediatric, family, adult, gerontological, adult/gerontological, and women’s health NPs. They numbered 11,764 in 2012 compared to 9,708 in 2011, an increase of 18.6 percent or 2,228 NPs. Read the rest of this entry »

“The real challenge of human biology, beyond the task of finding out how genes orchestrate the construction and maintenance of the miraculous mechanism of our bodies, will lie ahead as we seek to explain how our minds have come to organize thoughts sufficiently well to investigate our own existence.”

The initial enthusiasm following the mapping of the human genome has given way to a more circumspect outlook.  With the exception of a small number of promising interventions, advances in genomic science have yet to yield a critical mass of therapeutic breakthroughs – thus forestalling the birth of the era of precision medicine (PM).

While a comprehensive genomic understanding of disease and concomitant molecular-based patient taxonomy would doubtless hasten the arrival of PM, a significantly less costly alternative offers a promising interim approach.  A methodology known as collaborative filtering (CF) which has already achieved widespread use in advertising and marketing, has the potential to offer powerful insights not only to advertisers and others desiring to influence purchasing behavior but also to physicians, allied health care professional, patients, and their families by offering personalized advice and recommendations regarding health and disease.

CF relies directly on aggregated subject/user behavior to reveal complex and unexpected patterns that would otherwise be difficult to capture using known data attributes.  Recommendations generated from analyses of these patterns have demonstrated significantly greater reliability than those using more traditional demographic categories. The core idea behind applying CF to clinical decision-making is to make decisions about a patient based on historical data derived from multiple “similar” patients presenting multiple “similar” cases.  As Victor Streecher explains, “collaborative filtering in the health area could match the coping strategies, medical decisions, and preferences of similar others with specific needs and interests of the user.” Read the rest of this entry »

Editor’s note: This post has been revised to clarify that when a group health plan is partially insured and partially self-insured, the reinsurance obligation is on the insurer if it is responsible for the major medical portion of the plan.

On June 14, 2013, the Department of Health and Human Services released a notice of proposed rulemaking (NPRM) entitled “Program Integrity: Exchange, SHOP, Premium Stabilization Programs, and Market Standards.” Although the proposed rule does include a number of provisions related to program integrity, it covers a great deal more. It resolves a host of outstanding issues that must be tied up before the exchanges, premium stabilization programs, and market reforms become fully operational in 2014. (The proposal, by the way, uses the term “exchange” throughout rather than “marketplace,” which I have never gotten used to).

In some instances the NPRM modifies existing rules, as when it modifies the exchange final rule of March 2012 to allow states to operate SHOP exchanges only, ceding the individual exchange to the federal government. In many instances, it puts into regulation form guidance that has been issued earlier, such as the May 1, 2013 guidance on agents and brokers and the May 14, 2013 Frequently Asked Questions on Health Insurance Marketplace. It also, however, addresses problems that have only recently been identified, such as the problem of the “unbanked,” persons who will be eligible for premium assistance but are unable to pay premiums with checks because they do not have bank accounts. Read the rest of this entry »

The Affordable Care Act (ACA) will dramatically expand Medicaid in a number of states starting in January 2014. In this month’s issue of Health Affairs, new research from DeLeire and colleagues on Wisconsin’s 2009 BadgerCare expansion and from Price and Eibner on predicted cost and coverage impacts of the Medicaid expansion provides insights on the implications of state decision-making about whether to expand the program.

Since 2010, six states have already expanded Medicaid to cover some or all of the low-income adults targeted for coverage under health reform. To provide additional information on the impacts of such expansions, we undertook an in-depth exploration of the experiences of these states – California, Connecticut, the District of Columbia, Minnesota, New Jersey, and Washington – through qualitative interviews with 11 high-ranking Medicaid officials across all six states. In analyzing these interviews, we identified several key policy lessons that help elucidate the opportunities and challenges of expanding Medicaid under the ACA.  Below are some of our preliminary findings. Read the rest of this entry »

It is no secret that Americans are aging, but what is too often lost in this fact is that most people will need help as they grow older.  Unfortunately, America does not have a strategy to deal with this growing demand.  For some, this help comes in the form of needing just a little bit of assistance in the home with cooking meals or getting groceries.  For others, it is more comprehensive daily help in assisted living or nursing home care.

As Chair of the newly created federal Commission on Long-Term Care, I believe it is imperative for Americans to understand that 70 percent of us who live beyond the age of 65 will need some form of long-term care, on average for three years.  This is a potentially dangerous statistic given the reality that our nation’s system of care is outdated and lacks the tools to meet the needs of our growing senior population.

To better understand Americans’ attitudes and perceptions around aging and long-term care, as well as levels of preparedness for future care, the Associated Press – NORC Center for Public Affairs Research conducted a national poll of adults age 40 and older with funding from The SCAN Foundation.  Implications of these findings are profound considering the population of adults over 65 will nearly double to 19 percent — nearly 72 million people — by 2030. Read the rest of this entry »

Community benefit investments have been an obligation of nonprofit hospitals as a condition of their federal tax-exempt status for decades, and most states impose similar expectations.  The financial advantage that accrues to the nonprofit hospital industry as a result of their special tax-favored status was valued by the Joint Committee on Taxation at $12.6 billion in 2002 alone.  Neither Congress nor the IRS has established a minimum expenditure level for valuing the community benefit; indeed, the IRS allows hospitals “broad latitude” in determining their activities and contributions.  However, in the wake of increasing scrutiny by Congress, the IRS established a nationwide reporting system that enables a deeper dive into the question of nonprofit hospital community investment.

Two recent studies – one released by the hospital industry, the other, by academic researchers — provide a look behind the numbers. The industry study offers up a deceptively rosy spin, but a close look at both studies reveals strikingly small levels of true community benefit spending by many hospitals – particularly in states where hospitals are not required to report spending levels to state regulators. Read the rest of this entry »

In the past 12 years, several of our nation’s most storied public hospitals have closed, including DC General (2001), New Orleans’s Charity Hospital (2005), and Martin Luther King, Jr. hospital in Los Angeles (2007).  When Atlanta’s Grady Memorial Hospital was featured on the front page of The New York Times on Jan 8, 2008, it was widely assumed it would be the next to go. However, at its darkest hour, Grady received help from an unexpected quarter.

In the June issue of Health Affairs, a young physician, Dr. Kate Neuhausen, describes how she and other leaders of a little-known student organization mobilized hundreds of health professions students from around the state of Georgia to join the fight for Grady’s survival. It is difficult to overstate how perilous the hospital’s situation was at the time.  Because Grady provides such a disproportionate share of uncompensated care in the state of Georgia, it would have been impossible for metro Atlanta’s hospitals and private health care providers to absorb the sudden loss of more than 900 inpatient beds; the highly specialized trauma, burn and psychiatric services Grady provides; or the displacement of tens of thousands of inpatient days and hundreds of thousands of outpatient visits. The resulting social, medical and financial upheaval would have sent shockwaves throughout the region—the economic engine for the state and a vital financial, commercial and transportation hub for the Southeastern United States.

Fortunately, Atlanta’s business community and philanthropies grasped the gravity of the situation. So did Georgia’s governor, the leaders of Georgia’s General Assembly, the Commissioners of Fulton and DeKalb Counties, the appointed members of the Hospital Authority that ran Grady, the leadership of Emory University and Morehouse School of Medicine (which provides the hospital’s medical staff), Grady’s employees, and its patients. But each group had a different concept of what needed to be done. Urban-rural, partisan and racial politics came into play. Time was running out. Read the rest of this entry »

Last week’s annual report from the Medicare Trustees reflects small but noteworthy improvements in the financial outlook of part of the program. Annual growth in Medicare spending per beneficiary slowed to less than 1 percent last year, well below the per capita growth of the economy as measured by gross domestic product (GDP) and enough to push back the projected insolvency date for the Hospital Insurance (HI) Trust Fund (Part A, which pays for inpatient care) to 2026 — two years later than last year’s report.

This is good news but should be seen in context. As Figure 1 shows, annual estimates of HI solvency since 1990 have ranged from four years to 28 years, averaging 13.6 years. So this year’s projection falls just below the 24-year average.

The Trustees Report includes various ways to view Medicare’s fiscal health over time. One metric is to look at long-term projections of Medicare as a share of GDP over the next 75 years. Total Medicare spending includes Supplementary Medical Insurance (SMI, or Part B, which covers physician, outpatient hospital, and some home health costs that are unrelated to a stay in a hospital) as well as prescription drug benefits (Part D). Under the Trustees’ intermediate assumptions, total Medicare expenditures will grow from 3.7 percent of GDP in 2012 to 3.9 percent of GDP in 2020 and 6.5 percent of GDP in 2087, as shown in Figure 2. In the near term — that is, from now through about 2035 — the increase is being driven largely by the increasing numbers of Medicare-eligible baby boomers, who began entering the ranks of beneficiaries in 2011. Read the rest of this entry »

Dana Goldman and Adam Leive’s effort to discredit the single payer, Medicare-for-All model of financing health care — or as they put it, make “any conclusion decidedly more nuanced” — is sorely lacking in nuance, defined by Merriam-Webster as “made or done with extreme care or accuracy.”

Acknowledging Medicare’s greater success at controlling costs than private insurance plans, Goldman and Leive raise the specter of “underprovision of services” and doctors leaving the system if Medicare were universal.  But Medicare patients are significantly less likely to have problems with access to care and medical bills than non-elderly adults with private insurance, according to a recent study by The Commonwealth Fund. The same study found that Medicare beneficiaries are also more satisfied with their coverage than people with private insurance. Only 6 percent of beneficiaries in traditional Medicare rated their coverage as fair or poor in 2010, compared with 20 percent with employer-sponsored private insurance.

Among physicians who treat Medicare patients, 90 percent of all physicians and 96 percent of specialists are accepting new Medicare patients according to the Medicare Payment Advisory Commission.  In contrast to the limited networks of doctors available to the privately insured, and the appalling “underprovision of services” to those left uninsured and underinsured by today’s for-profit, market driven system, a Medicare-for-All system would expand choice and access. Read the rest of this entry »