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New Health Affairs Looks At Delivery Reform, Spending Sources

Posted By Chris Fleming On November 5, 2012 @ 4:00 pm In All Categories,Employer-Sponsored Insurance,Health Care Costs,Payment,Physicians,Prevention,Quality,Spending | No Comments

The November 2012 issue of Health Affairs [1], released today, contains articles on a wide variety of health policy topics, including:
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  • Early insights from emerging care delivery models, such as accountable care organizations (ACOs) and patient-centered medical homes.
  • Analyses of sources of health spending for employers and other payers — including how a handful of common health risk factors account for a sizeable portion of costs for employees’ health care, and how physicians with relatively little experience account for more spending than those with more experience.
  • A look at how China has drastically expanded health insurance coverage—to an astounding 95 percent of its population—through an interview with Chen Zhu, China’s health minister.


Depression leads a list of ten risk factors linked to more than one-fifth of employer and employee health spending. Ron Goetzel [2] of Emory University’s Institute for Health and Productivity Studies and coauthors matched health spending for 92,000 employees at seven organizations over three years with a list of ten common risk factors. They discovered that 22.4 percent of the $366 million spent annually by the seven employers and their employees was attributed to the ten risk factors, all of which could be addressed by a combination of the appropriate health care and behavioral interventions.

High risk for depression led the list. The additional annual medical expenditure for an employee with depression was $2,185 higher—or 48 percent more—than for a worker without depression. High blood glucose ($1,653 more), high blood pressure ($1,378 more), and obesity ($1,090 more) were also strongly related to increased health care costs. Workers who were physically inactive ($606 more), used tobacco ($587 more), or had high stress ($343 more) also incurred higher costs for themselves and their employers than workers who did not.

Physicians with the least experience account for more health care spending than physicians with the most experience. Ateev Mehrotra [3] of the Rand Corporation and coauthors analyzed the cost profiles of more than 12,000 physicians practicing in Massachusetts. Physician cost profiles provide a picture of the interventions performed by different physicians and are being used by Medicare and private plans to identify which physicians account for more health care spending.

The researchers found that physicians with fewer than ten years of experience accounted for 13.2 percent higher overall costs than did physicians with forty or more years of experience. The researchers did not find any other association between costs and other physician characteristics, including having paid malpractice claims, being subject to disciplinary action, gender, size of physician group, and board certification status. The results raise the possibility that the more costly practice style of newly trained physicians may be a driver of rising health care costs overall.

China’s massive investment in access to health insurance and care facilities is beginning to bear fruit. China’s Health Minister Chen Zhu was interviewed by Tsung-Mei Cheng [4] of the Woodrow Wilson School of Public and International Affairs at Princeton University on early results of China’s 2009 health reforms. Huge investments in insurance coverage, health care facilities, and the health care workforce have resulted in more than 95 percent of China’s population of 1.34 billion now having some form of health insurance, according to China’s Health Ministry. The capacity to deliver care to the Chinese has been greatly expanded, with one community health services center now located on every street in every one of China’s cities.

It’s too soon to fully gauge the effectiveness of ACOs or patient-centered medical homes, but no one can say that they aren’t off and running. Nine articles offer early insights on ACO and patient-centered medical home care delivery models, both of which have made significant headway in a relatively short period of time. ACOs, in particular, have seen considerable momentum—from a standing start just two years ago, to more than 300 ACOs now operating in forty-eight states.

The goal of both models is to more tightly coordinate care and improve the health of patients, but no one is sure whether either model will deliver major cost savings, especially right away. Articles include the following:
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  • Accountable Care Organizations May Have Difficulty Avoiding the Failures of Integrated Care Networks of the 1990s, by Lawton Burns and Mark Pauly [5] of the Wharton School of the University of Pennsylvania.
  • Advancing Accountable Care: A Proposed Framework for Evaluating ACO Formation, Implementation, and Performance, by Elliott Fisher [6] of the Center for Population Health at the Dartmouth Institute for Population Health and Clinical Practice and coauthors.
  • Advancing Accountable Care: Insights from the Brookings-Dartmouth ACO Pilot Sites, by Bridget Larson [7], formerly of the Dartmouth Institute for Health Policy and Clinical Practice, and coauthors.
  • Many Accountable Care Organizations Are Now Up and Running, If Not Off to the Races, by Harris Meyer [8], a freelance writer based in Yakima, Washington.
  • Small Primary Care Practices Have Four Very Large Hurdles to Overcome on the Way to Patient-Centered Medical Homes, by Paul Nutting [9] of the University of Colorado Health Sciences Center and coauthors.
  • Results from a Patient-Centered Medical Home Pilot at UPMC Health Plan Hold Lessons for Broader Adoption of the Model, by Cynthia Napier Rosenberg [10], formerly of the UPMC Health Plan, and coauthors.
  • A Collaborative Accountable Care Model in Three Practices Showed Promising Early Results on Costs and Quality of Care, by Richard Salmon [11] of Cigna HealthCare and coauthors.
  • How One Academic Health Center Is Finding Its Place As an Accountable Care Organization, by Alfred Tallia and Jenna Howard [12] of the Robert Wood Johnson Medical School.
  • States Are Moving Forward with Reforms to Shift Primary Care into Patient-Centered Medical Homes, by Mary Takach [13] of the National Academy for State Health Policy.

Article printed from Health Affairs Blog: http://healthaffairs.org/blog

URL to article: http://healthaffairs.org/blog/2012/11/05/new-health-affairs-looks-at-delivery-reform-spending-sources/

URLs in this post:

[1] November 2012 issue of Health Affairs: http://content.healthaffairs.org/content/31/11.toc

[2] Ron Goetzel: http://content.healthaffairs.org/content/31/11/2474.abstract

[3] Ateev Mehrotra: http://content.healthaffairs.org/content/31/11/2453.abstract

[4] Tsung-Mei Cheng: http://content.healthaffairs.org/content/31/11/2536.abstract

[5] Lawton Burns and Mark Pauly: http://content.healthaffairs.org/content/31/11/2407.abstract

[6] Elliott Fisher: http://content.healthaffairs.org/content/31/11/2368.abstract

[7] Bridget Larson: http://content.healthaffairs.org/content/31/11/2395.abstract

[8] Harris Meyer: http://content.healthaffairs.org/content/31/11/2363.abstract

[9] Paul Nutting: http://content.healthaffairs.org/content/31/11/2417.abstract

[10] Cynthia Napier Rosenberg: http://content.healthaffairs.org/content/31/11/2423.abstract

[11] Richard Salmon: http://content.healthaffairs.org/content/31/11/2379.abstract

[12] Alfred Tallia and Jenna Howard: http://content.healthaffairs.org/content/31/11/2388.abstract

[13] Mary Takach: http://content.healthaffairs.org/content/31/11/2432.abstract