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Teaching Health Centers: An Attainable, Near-Term Pathway To Expand Graduate Medical Education


October 17th, 2014

Stakeholders in Graduate Medical Education (GME) and members of Congress eagerly anticipated the long delayed but recently released Institute of Medicine (IOM) GME report. While perceptively characterizing the defects in our GME system, recommendations of the report generated substantial controversy among participants at a recent GME forum hosted by Health Affairs. The IOM proposed limited and gradual changes in Medicare GME financing, but the lack of support for GME expansion was not well received by some.

At present there are multiple legislative GME proposals, but none has gained broad support among the various stakeholders. Congressional committees responsible for GME funding view this lack of consensus among GME stakeholders as a major obstacle.

We describe a near-term and attainable pathway to expand GME that could gain consensus among these stakeholders. This approach would sustain and expand Teaching Health Centers (THCs), a recent initiative that directly funds community-based GME sponsoring institutions to train residents in primary care specialties, dentistry and psychiatry. We further propose selectively expanding GME to meet primary care and other demonstrable specialty needs within communities, and building in evaluations to measure effectiveness of innovative training models.

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Health Affairs Web First: New Study Shows Low-Income Residents In Three States Support Medicaid Expansion


October 9th, 2014

Expansion of Medicaid under the Affordable Care Act (ACA) to millions of low-income adults has been controversial. However, little is known what these Americans themselves think about Medicaid. A new study, recently released as a Web First by Health Affairs, surveyed nearly 3,000 low-income adults in Arkansas, Kentucky, and Texas (states that have adopted different approaches for Medicaid expansion).

This telephone survey, conducted in late 2013, found that 83 percent of respondents in Arkansas and Kentucky and 79 percent of those in Texas were in favor of their state expanding Medicaid under the ACA. Roughly two-thirds of uninsured respondents planned to apply for coverage in 2014. The majority of adults surveyed viewed Medicaid as comparable to or better than private insurance in overall health care quality.

Authors Arnold Epstein, Benjamin Sommers, Yelena Kuznetsov, and Robert Blendon developed a thirty-eight-item survey and targeted citizens ages 19–64 with household incomes of less than 138 percent of the federal poverty level. Forty percent of Texas respondents were Latino. A significant number of respondents (40 percent in Arkansas and Kentucky and 32 percent in Texas) said they were in “fair” or “poor” health, with a substantial number of respondents reporting living with chronic health conditions.

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A Patient Advocate’s Perspective On Paying For Value


October 9th, 2014

When patient-centered outcomes research “is used well, it can be a powerful tool in making medical care better informed, without limiting patients’ and providers’ choices.” That was the promise that I, and many others, held out with creation of the Patient-Centered Outcomes Research Institute (PCORI) in 2010. Will PCORI achieve this goal? It is increasingly clear that evolving “value-based” payment models in health care, accelerated via the Affordable Care Act (ACA), will play a central role in how that question gets answered.

The movement to place greater financial risk on providers in an effort to pay for value rather than volume will have the effect of fundamentally changing the way health care providers interact with patients. But the question in value-based payment remains: value to whom? The answer should be, of course, value to the patient. And the answer will be, intrinsically, shaped by application of evidence.

While I applaud efforts to improve and advance our health care system through payment and delivery reforms, I am also mindful that such value-based payment systems must be built upon the foundation of “patient-centeredness.” Indeed, lawmakers and policy experts have long agreed that a “patient-centered healthcare system” is the Holy Grail of bipartisan health care reform. Yet despite significant progress in advancing patient-centeredness in our health system, much more work remains to be done.

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Drug Discount Analysis Misses The Mark


October 8th, 2014

Rena Conti and Peter Bach’s analysis of disproportionate share (DSH) hospitals in the 340B drug discount program — published in the October issue of Health Affairs — neglects an essential point: compared to non-340B DSH hospitals, 340B DSH hospitals provide over twice as much care to Medicaid and low-income Medicare patients, and almost twice as much uncompensated care. 340B DSH hospitals across the board provide high levels of uncompensated care. For these and other reasons enumerated below, the article does not support the criticism that 340B DSH hospitals are no longer serving vulnerable patients.

First, Conti and Bach misconstrue the 340B program’s intent. 340B is not – and never was – a direct assistance program for the poor. According to the Government Accountability Office, “The 340B program allows certain providers within the U.S. health care safety-net to stretch federal resources to reach more eligible patients and provide more comprehensive services, and we found that the covered entities we interviewed reported using it for these purposes.”

For example, 340B savings help The Henry Ford Hospital fund four oncology clinics and related services in Detroit and surrounding townships. The program is also enabling Henry Ford to hire pharmacists and nurses to follow up with their patients to ensure they are taking their medicines properly and that the treatment is effective.

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Implementing Health Reform: Judge Rules Against Premium Tax Credits In ACA Federal Exchanges (Updated)


September 30th, 2014

On September 30, 2014, Judge Ronald White of the United States District Court for the Eastern District of Oklahoma decided in Pruitt v. Burwell and Lew that the Affordable Care Act does not authorize the federally exchanges to issue premium tax credits.  He held that the Internal Revenue Service rule that provided the contrary is invalid.  Judge White’s decision followed the opinion of the majority of a panel of the District of Columbia circuit’s decision in Halbig v. Burwell, although the judgment in that case has been vacated pending a rehearing of the case by the full D.C. Circuit.  His decision was contrary to the decision of the Fourth Circuit Court of Appeals upholding the IRS rule in King v. Burwell.  The district courts in both Halbig and King had upheld the IRS rule.

The Pruitt case has a long and circuitous history.  It was originally filed by Oklahoma attorney general Scott Pruitt in 2011 as an individual mandate challenge.  After the Supreme Court upheld the individual mandate in 2012, Attorney General Pruitt amended his complaint to instead challenge the ability of the federally facilitated exchanges to issue premium tax credits.  In an earlier ruling, Judge White refused to allow Oklahoma to sue on its own behalf as a state (a ruling that Judge White did not change in this decision), but concluded that it might have standing to proceed as a large employer.

In his September 30 ruling, Judge White concluded that Oklahoma did in fact have standing to sue as a large employer.  Under the ACA’s employer responsibility provisions, a large employer that does not offer its employees affordable and adequate coverage can be subject to a tax penalty if one or more of its employees receives premium tax credits through the exchange.  If the federally facilitated exchange, which is the ACA exchange in Oklahoma, is unable to grant premium tax credits, Oklahoma, which is a large employer, cannot be subject to a penalty if it fails to offer coverage to its employees.

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An Interview With George Halvorson: The Kaiser Permanente Renaissance, And Health Reform’s Unfinished Business


September 30th, 2014

For decades, health policymakers considered Kaiser Permanente the lode star of delivery system reform.  Yet by the end of 1999, the nation’s oldest and largest group model HMO had experienced almost three years of significant operating losses, the first in the plan’s history. It was struggling to implement a functional electronic health record, and had a reputation for inconsistent customer service.  But most seriously, it faced deep divisions between management and the leadership of its powerful Permanente Federation, which represents Kaiser’s more than 17,000 physicians, over both strategic direction and operations of the plan.

Against this backdrop, Kaiser surprised the health plan community by announcing in March 2002 the selection of a non-physician, George Halvorson, as its new CEO.  Halvorson had spent most of his career in the Twin Cities, most recently as CEO of HealthPartners, a successful mixed model health plan.  Halvorson’s reputation was as a product innovator; he not only developed a prototype of the consumer-directed health plan in the mid-1990’s, but also population health improvement objectives for its membership, both firsts in the industry.

During his twelve year tenure as CEO, Halvorson not only guided the plan to solid profitability, but added a million members in California, its largest market, despite a devastating recession and a national retreat of commercial HMO membership.  He invested over $6 billion in computerized patient care systems and population health management infrastructure, healed the breach with Kaiser’s physicians, and markedly increased its consumer satisfaction scores, earning 5 STAR ratings under Medicare Advantage.  He left the organization at the end of 2013 with more than $53 billion in revenues and more than $19 billion in reserves and investments.

This interview covers Halvorson’s time at Kaiser, his views of health reform, including the unfinished reform agenda, and his public health activism.  It was conducted by Jeff Goldsmith, a veteran health industry analyst, and Associate Professor of Public Health Sciences at the University of Virginia.  Jeff is a member of the editorial board of Health Affairs.

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Different Parts Of The Same Elephant: Medicaid Research And State Expansion Decisions


September 19th, 2014

Debates about Medicaid expansion betray an underlying fundamental disagreement not only about the Affordable Care Act (ACA) but about the Medicaid program itself. Medicaid, unlike Medicare, lacks the near-universal buy-in to the fundamental value of the program to beneficiaries’ health and well-being. As a means-tested (read welfare-related) program, Medicaid raises concerns and disagreements regarding work (dis)incentives, labor market effects, the “deserving” poor, and how this relates to the construct of health care as a right and a public good.

The Medicaid program serves as a centerpiece of the ACA and of the nation’s health care safety net. The states that continue to oppose Medicaid expansion reveal an important and less acknowledged aspect of this debate: That there remains fundamental disagreement in the United States about whether to include Medicaid as a central and important component of the evolving health care financing and delivery system, or whether system transformation would involve a move away from or elimination of Medicaid, even as a safety net program. Alternatively, how does or might the Medicaid program maintain (or attain) sufficiently broad-based buy-in to withstand wide swings in political control at the federal and state levels?

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Pediatric Asthma: An Opportunity In Payment Reform And Public Health


September 18th, 2014

Editor’s note: The post is informed by a case study, the third in a series made possible through the Merkin Initiative on Physician Payment Reform and Clinical Leadership, a special project to develop clinician leadership in health care delivery and financing reform. The case study will be presented on Wednesday, September 24 using a “MEDTalk” format featuring live story-telling and knowledge-sharing from patients, providers, and policymakers. 

The Clinical Challenge: A Chronic, but Manageable Illness

Asthma affects 7 million children – more than 10 percent of kids in the U.S. – and is the most common chronic childhood disease. Yet even with high levels of insurance coverage, 46 percent of pediatric patients have uncontrolled asthma. There are substantial gaps in appropriate prescribing and adherence to effective medications. In addition, a multitude of non-medical issues influence a child’s ability to control their asthma: low parental health literacy, poor quality housing, and environmental triggers such as pests, mold, and cleaning chemicals. As a result 800,000 kids visit the emergency department (ED) for asthma each year.

In 2007 (the latest year which data are available) the U.S. spent over $56 billion on asthma care, of which nearly $27 billion was spent on pediatric asthma. Medicaid is the primary payer for pediatric asthma related hospitalizations with 55 percent of the market. Better control may also mean lower medical costs, due to reductions in ED visits, admissions, and other health care utilization – patients with poorly controlled severe asthma cost nearly $5,000 more per patient per year compared to average pediatric asthmatic costs.

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Year Zero: Leaders At Oregon’s CCOs Share Lessons From The Early Days


September 11th, 2014

Oregon is one of the first states to implement a version of accountable care organizations statewide across its Medicaid program; insights from those who were “on the ground” during the early days of this experiment may prove useful to other states contemplating a similar model.

Oregon’s Big Bet

Facing a massive gap in funding for Medicaid, a team of legislators, business leaders, and health care leaders in Oregon developed a plan to redesign Oregon’s Medicaid delivery system with Coordinated Care Organizations (CCOs), regional public-private partnerships that accept a single global budget and are accountable for the physical, mental, and dental health care of their local Medicaid population. Oregon secured a federal investment of $1.9 billion over five years to support the costs of transitioning to the CCO model; if savings do not materialize, Oregon will have to pay the money back.

CCOs are designed to incorporate all who care for a regional Medicaid population. This includes payers who compete for commercial contracts, providers who compete for business, and county public health departments who have not traditionally shared their systems or structures. CCOs include health systems with separate EHRs, for-profit and not-for-profit entities, and community-based organizations with a fraction of the operating budgets of other partners. CCOs had to grow fast: applications were due to the state just a few months after the enabling legislation passed.

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A First Look At How The Affordable Care Act Is Affecting Coverage Among Parents And Children


September 9th, 2014

Following the implementation of the major coverage provisions of the Affordable Care Act (ACA) in 2014, the question arises: “How is the health law affecting uninsured children and their families?” Today, the Urban Institute released two new briefs using the Health Reform Monitoring Survey (HRMS) to begin to answer that question.

The bottom line is that between September 2013 and June of 2014, coverage increased for parents, particularly in states that have expanded Medicaid under the ACA, but no coverage changes were yet apparent for children. This early look suggests that the ACA is contributing to coverage gains for parents, which in turn should be beneficial to both them and their children.

Children’s Coverage

The report on children’s coverage from The Urban Institute and the Georgetown University Center for Children and Families found that the uninsured rate for children remained at historically low levels—close to 7 percent—but did not decline further for children under age 18 between September 2013 and June 2014. However, this national snapshot does not capture all of the fluctuations in children’s coverage that may be occurring across the country in particular states; we will have to wait for data from federal sources to have a definitive assessment of how coverage is changing at the state level.

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Implementing Health Reform: Medicaid Eligibility, 2015 Navigator Grants, And FAQs (Updated)


September 8th, 2014

The decision of the full D.C. Circuit to review the panel decision in Halbig v. Burwell en banc was clearly the big Affordable Care Act (ACA) court decision of the first week in September, but a September 2 decision of the federal district court of the Middle District of Tennessee, Gordon v. Wilson, is also worthy of note.

The Medicaid law has long required state Medicaid programs to determine eligibility for Medicaid with “reasonable promptness,” defined by the regulations to mean within 90 days for applicants with disabilities and 45 days for everyone else. Applicants whose applications are not determined reasonably promptly are entitled by the Medicaid law and by the Due Process Clause of the Constitution to a fair hearing.

Medicaid Eligibility and Tennessee

Tennessee, like all states, was required by the ACA to begin calculating Medicaid eligibility for most recipients using modified adjusted gross income, or MAGI as of January 1, 2014. Tennessee attempted to establish a new computer system for doing this, but when it was not ready by January 1, Tennessee asked the federal exchange to determine Medicaid eligibility until it could get its system operational.

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Big Data And The Public’s Health: Building Resilience For The 21st Century


September 5th, 2014

Editor’s note: For more on big data, check out the July issue of Health Affairs. 

In late August 2012, Hurricane Isaac was bearing down on New Orleans. Staff at the City’s Health Department were busy fielding calls from concerned citizens and reaching out to individuals on the City’s Special Needs Registry, a list of residents who have medical or mobility needs and who require extra assistance during an emergency. These individuals are at the highest health risk and are the first to face adverse health consequences during an emergency.

When Isaac made landfall as a slow-moving storm, it dumped approximately 20 inches of rain onto the streets of New Orleans, causing major power outages that lasted for eight days. Immediately following the storm, shelters were opened and many services were available; however, without power to use TV, radios, internet, or cell phones it was difficult for City officials to communicate this information to the public.

The Health Department went door to door to find at-risk residents, but we had no organized method of locating them or answering countless other urgent questions: Who needs power to run their medical equipment? Who needs transportation to dialysis? Who is trapped in a wheelchair on the fifth floor of a building where the elevators are not working?

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The Payment Reform Landscape: Non-Payments


September 4th, 2014

Throughout 2014 here on Health Affairs Blog, I have shared Catalyst for Payment Reform (CPR)’s insights on different types of payment reform, which run along a spectrum of financial risk. We began the year by examining payment models that have “upside only” risk, such as pay-for-performance, which give health care providers the opportunity for financial gain from improving care with no added financial risk.

Then we examined payment models that contain “two-sided risk,” like shared-risk arrangements for ACOs, bundled payment, and capitation with quality, where providers can reap financial gain as well as experience financial losses depending on care outcomes and expenditures.

This month, we examine a model that presents “downside only” risk — non-payment to providers. This payment strategy puts providers at financial risk for care that could or should have been avoided.

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Examining The Present And Future Of The Health Spending Growth Slowdown


September 3rd, 2014

Each year, Health Affairs publishes national health spending projections for the coming decade by authors at the Centers for Medicare and Medicaid Services Office of the Actuary (OACT). The articles provide important documentation of past trends and insight about future spending, using transparent, vetted assumptions.

In this year’s study, Andrea Sisko and coauthors reveal that the recent slowdown in health care spending growth has continued. Specifically, the authors report that national health care spending in 2013 is predicted to have increased by only 3.6 percent — the fifth consecutive year of spending growth below 4 percent. [Editor's note: Health Affairs also publishes annual retrospective health spending reports from OACT -- the journal expects to publish OACT's final numbers for 2013 spending in December.]

When interpreting the data, it is important to distinguish between the spending growth driven by increased spending per beneficiary and growth driven by increases in the number of beneficiaries. This is particularly relevant for Medicare (which is experiencing an influx in baby boomers) and Medicaid (which is experiencing Affordable Care Act (ACA) driven enrollment growth). Certainly, aggregate spending is an important statistic. The budgetary implications of rapid Medicare spending growth due to growth in the number of beneficiaries are similar to the implication of spending growth driven by growth in spending per beneficiary.

Yet the normative interpretation of spending growth will depend dramatically on the cause. We should celebrate aging baby boomers, increases in longevity and wellbeing. Similarly, higher Medicaid enrollment was the intended outcome of the ACA and, at least in many circles, is considered a good thing (relative to growth in the number of uninsured). Of course, such an increase in enrollment creates pressure on public budgets.

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Projected Slow Growth In 2013 Health Spending Ahead Of Future Increases


September 3rd, 2014

Insurance Coverage, Population Aging, and Economic Growth Are Main Drivers of Projected Future Health Spending Increases

New estimates released today from the Office of the Actuary at the Centers for Medicare and Medicaid Services project a slow 3.6 percent rate of health spending growth for 2013 but also project a 5.6 percent increase in health spending for 2014 and an average 6.0 percent increase for 2015–23. The average rate of projected growth for 2013–23 is 5.7 percent, exceeding the expected average growth in gross domestic product (GDP) by 1.1 percentage points.

Increased insurance coverage via the Affordable Care Act (ACA), projected economic growth, and population aging will be the main contributors of this growth, ultimately leading to an expected 19.3 percent health share of nominal GDP in 2023, up from 17.2 percent in 2012.  This compares to the Office of the Actuary’s 2013  report, published in Health Affairs, predicting an average growth rate of 5.8 percent for 2012–22.

Every year, the Office of the Actuary releases an analysis of how Americans are likely to spend their health care dollars in the coming decade. The new findings appear as a Health Affairs Web First article and will also appear in the journal’s October issue.

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Transcending Obamacare? Analyzing Avik Roy’s ACA Replacement Plan


September 2nd, 2014

Avik Roy’s proposal, “Transcending Obamacare,” is the latest and most thoroughly developed conservative alternative for reforming the American health care system in the wake of the Affordable Care Act. It is a serious proposal, and it deserves to be taken seriously.

Roy’s proposal is a curious combination of conservative nostrums (limiting recoveries for victims of malpractice), progressive goals (eliminating health status underwriting, providing subsidies for low-income Americans), and common sense proposals (enacting a uniform annual deductible for Medicare).

Most importantly, however, Roy proposes that conservatives move on from a single-minded focus on repealing the ACA toward building upon the ACA to accomplish their policy goals. He supports repealing certain features of the ACA—including the individual and employer mandate—but would retain others, such as community rating and exchanges. As polling repeatedly shows that many Americans are not happy with the ACA, but that a strong majority would rather amend than repeal it, and as it is very possible that we will have a Congress next year less supportive of the ACA than the current one, Roy’s proposal is important.

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Arkansas Payment Improvement Initiative: The First Year


August 25th, 2014

Editor’s note: This post is part of a periodic Health Affairs Blog series, which will run over the next year, looking at payment and delivery reforms in Arkansas and Oregon. The posts will be based on evaluations of these reforms performed with the support of the Robert Wood Johnson Foundation. The authors of this post are part of the team evaluating the Arkansas model.

Arkansas payers and providers actively participated in the design of both the episodic payment and patient-centered medical home (PCMH) models the state has recently implemented. We’ve written about each of these components of the multi-payer Arkansas Payment Improvement Initiative (APII) in our previous Health Affairs Blog posts.

The state’s fragmented and largely rural provider environment presents an important test for a novel episodic payment model that may, if successful, have broader applicability in other states sharing a similar health care landscape. Fourteen episodes have now been launched and provider participation is mandatory. While our first posting goes into greater detail on the nuances of Arkansas’ approach to episodes, we provide the following brief summary here to add context to this discussion.

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Key Success Factors For the Medicare Shared Savings Program


August 21st, 2014

In January 2012 the Centers for Medicare & Medicaid Services (CMS) officially launched the Medicare Shared Savings Program (MSSP) for the formation of national Accountable Care Organizations (ACOs). Early participants were charged with bringing the theory of accountable care into practice.

Premier, a national healthcare improvement alliance of hospitals and health systems, created a population health collaborative in 2010 designed to assist providers with developing and implementing successful ACOs both in the public and private sectors.

Thus far, the Premier collaborative has advised nearly 30 MSSP applicants, and is working with another 30 more, on how to structure and manage an effective ACO. Through benchmarking tools, financial models, the sharing of best (and worst) practices, etc., members of the Premier PACT Collaborative have outperformed the national MSSP cohort.

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Whither CHIP?


August 19th, 2014

In a day all but lost to Affordable Care Act prehistory, on November 7, 2009, the House of Representatives passed the Affordable Health Care for America Act. Among the bill’s many differences with its Senate counterpart, it would have allowed the Children’s Health Insurance Program (CHIP) to expire at the end of 2013, with children covered under that program enrolled in either Medicaid or commercial Exchange plans.

On December 24, the Senate passed the Patient Protection and Affordable Care Act (ACA). Their bill extended CHIP through fiscal year 2015 while, curiously, enhancing the Federal match rate for the program beyond that date and instituting a maintenance of effort (MOE) requirement for states to keep CHIP kids covered through 2019.

At the time, drafters of the respective chamber’s versions of health reform anticipated heading to conference to negotiate and resolve their differences, with the disposition of CHIP one of the top considerations.

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Hospital Readmission Reduction Program Reignites Debate Over Risk Adjusting Quality Measures


August 14th, 2014

Do safety net hospitals categorically under perform the national average in terms of managing readmissions? Or is something else triggering higher rates of readmissions in these facilities?  These questions are essential for policymakers to answer as pay-for-performance (P4P) penalties are having a disparate impact on hospitals that serve low-income areas.

Medicare’s Hospital Readmission Reduction Program (HRRP), for example,  links risk-adjusted hospital readmission rates to financial penalties. Hospitals with risk-adjusted readmission rates that fall below the national average are penalized by having their annual Medicare payments reduced by up to 2 percent. In 2015, hospital payments are scheduled to be reduced by up to 3 percent.

But the program’s current system for measuring readmission rates may be flawed. Numerous analyses have found that safety net hospitals, which care for low-income patients, are more than twice as likely to be penalized than hospitals caring for higher-income patients.

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