April 17th, 2014
Background: In a very short period of time, Accountable Care Organizations (ACOs) have become an important and widespread part of the US health care landscape. A recent Health Affairs Blog post estimates the total number of public (Medicare) and private ACOs at more than 600 nationally, covering more than 18 million insured population. Despite their rapid and widespread adoption, relatively little is known about how ACOs actually work and how successful they have been. This is due in part to their relative “newness,” as many reported ACOs are just getting up and running. Others have been operational for short periods of time and have yet to produce meaningful or long-term sustainable results.
This Health Affairs Blog post helps fill some of this void by reporting on the operational experiences of one of the oldest (4+ years) and largest commercial ACOs in the nation. A previous Health Affairs Blog post reported on its initial planning and start-up phase, and a subsequent Health Affairs article reported on its early financial results.
In 2007, Blue Shield of California, along with provider and employer partner organizations, began exploring development of one of the first ACO-like programs in the country to serve Commercial patients. It launched in 2010 and, as reported below, has been generating savings to consumers throughout the period. Located in the competitive Sacramento market of northern California, the ACO is an example of an innovative shared savings model involving a large insurer—Blue Shield of California; a purchaser—the California Public Employees Retirement System (CalPERS); a physician group—Hill Physicians Medical Group (HPMG); and a hospital system—Dignity Health. The population served approximately 42,000 CalPERS employees and their families covered by Blue Shield. Read the rest of this entry »
April 17th, 2014
Change is underway in the delivery and financing of American health care, and it is manifested in the evolving relationship of hospitals and physicians across the U.S. These developments are most striking in California, but are appearing in various forms in almost all states. Physicians and hospitals are being both “pushed” and “pulled” together in new ways by a variety of market forces, including the development of Accountable Care Organizations (ACOs) for both Medicare and commercially insured patients, increased direct employment of physicians by hospitals, the emergence of new payment mechanisms such as global payments, and, in general, by the need for physicians, physician groups and hospitals to deliver greater “value.”
All of this presents the opportunity to redesign care to be more coordinated, efficient, patient-driven, and effective. These integration forces could lead to the kind of organizations envisioned 15 years ago in the Institute of Medicine report “Crossing the Quality Chasm”, resulting in the Triple Aim of better health, better patient care experiences and outcomes, and improved affordability — driven, in part, by new patient care models and payment methods including incentives for improving the value of health care services.
Many physicians are uncomfortable with the idea of physician-hospital integration for several reasons. The long tradition of “professional autonomy”– perhaps best described as “the need for physicians to be able to make appropriate and scientifically based patient-by-patient decisions in the best interest of those patients” — can raise fears among some physicians about becoming part of a larger practice or institution and losing that autonomy. Additionally, some physician groups have shown that they can develop a successful ACO without the need for hospital and insurance partners, preferring to manage the clinical and financial risk alone. Read the rest of this entry »
April 16th, 2014
Editor’s note: This post responds to the April Narrative Matters essay by Gary Epstein-Lubow, a geriatric psychiatrist, which recounts the life-changing stress experienced by relatives who care for loved ones with dementia. Epstein-Lubow’s essay is freely available to all readers, or you can listen to him read it. You can also read an abridged version of the essay published April 15 in the Washington Post.
When my daughters were five and six years old, I took them to visit my grandmother in the Rosa Coplon Home in Buffalo, New York.
“Bubbie,” I said, “These are my little girls. Do you remember when I was this age?”
She looked at me and at them and finally held out her arms to embrace us and said (in Yiddish), “I don’t know who you are, but I know you belong to me.”
That experience so affected my elder daughter that when she was a teenager she undertook a project interviewing older people and creating a radio program from the tapes.
I thought of this moment when I read Gary Epstein-Lubow’s Narrative Matters essay, “A Family Disease: Witnessing Firsthand The Toll That Dementia Takes on Caregivers,” published in the April issue of Health Affairs. Read the rest of this entry »
April 16th, 2014
Editor’s note: For more on this topic, see the April issue of Health Affairs, which features a series of articles on Alzheimer’s disease.
In the corporate world, every company has a chief financial officer charged with ensuring that the organization meets all tax and accounting mandates and to report the data to officers of the company, shareholders, employees and the general public.
Yet, while organizations expend great effort addressing these matters, many miss another opportunity to protect their employees’ well-being by failing to talk about end-of-life care. Most companies consider advanced illness to be a private matter. But in fact, this hands-off approach most assuredly affects the financial health of any organization – and the emotional well-being of its workforce.
Beyond its direct impact on individuals’ health and well-being, advanced illness can take a heavy economic toll, including its effects on productivity, health and benefits costs, employee potential and engagement. According to the MetLife Mature Market Institute study, the total estimated cost to employers for all full-time employed caregivers is a staggering $33.6 billion. The average cost per employee for caregiving responsibilities ranges from $2,100 to $2,400. Read the rest of this entry »
April 15th, 2014
On April 14, 2014, the non-partisan Congressional Budget Office, together with the staff of the Joint Committee on Taxation, released an updated estimate on the Effects of the Insurance Coverage Provisions of the Affordable Care Act. The CBO report brings good news for the ACA. The CBO projects now that the ACA’s coverage provisions will cost $5 billion less for this year than it projected just two months ago. Over the 2015 to 2024 period, CBO projects that the ACA will cost $104 billion less than it projected in February. At the same time, the CBO projects that the number of uninsured Americans will in fact decrease by an additional one million over the next decade, by 26 rather than 25 million, as it estimated in February.
The CBO report estimates that the net cost of the ACA’s coverage provisions will be $36 billion in 2014, $1,383 billion over the 2015 to 2024 period. This estimate consists of $1,839 billion for premium tax credits and cost-sharing reduction payments, Medicaid, CHIP, and small employer tax credits, offset by $456 billion in receipts from penalty payments, the excise tax on high-premium insurance plans, and the effects on tax revenues of projected changes in employer coverage. The CBO report does not include an estimate of the total reduction in the federal deficit attributable to the ACA, as the CBO has concluded that it is no longer possible to estimate the net effect of ACA changes on existing federal programs, but the most recent CBO estimate from 2012 projected that the ACA would reduce the federal deficit over the 2013 to 2022 period by $109 billion. Given projected further reductions in Medicare spending projected in a CBO budget report also released on April 14, it is reasonable to believe that the ACA’s impact on the budget may be even greater than earlier estimated. Read the rest of this entry »
April 15th, 2014
Editor’s note: In addition to Darshak Sanghavi (photo and bio above), this post is coauthored by Meaghan George, a project manager at the Engelberg Center for Health Care Reform at the Brookings Institution. The post is adapted from a full-length case study, the first in a series of case studies made possible through the Engelberg Center’s Merkin Initiative on Physician Payment Reform and Clinical Leadership, a special project to develop clinician leadership of health care delivery, payment and financing reform under the leadership of Mark McClellan. The case studies will be presented using a “MEDTalk” format featuring live story-telling and knowledge-sharing from patients, providers, and policymakers. The event series will kickoff on Wednesday, April 16 from 10 a.m. – Noon EST.
Clinicians and hospitals across the nation struggle with providing and paying for optimal care for their congestive health failure (CHF) patients. However, there are opportunities to make care better. In fact, of the more than 10,000 pages in the Affordable Care Act (ACA) implementing regulations, the least talked about are the dozens of small experiments led by the Center for Medicare and Medicaid Innovation (CMMI) that test new ways to pay for medical services.
We use a case study approach to investigate and tell the story of what two academic medical centers, Duke University Health System (“Duke”) and University of Colorado Hospital (“Colorado”), are doing to innovate and improve CHF care while implementing alternative payment models offered by CMMI. Read the rest of this entry »
April 14th, 2014
At the end of February, I had the pleasure of speaking about global health diplomacy at the Nursing Leadership in Global Health Symposium at Vanderbilt University. Nurses are one of the specialties that we support in the Frist Global Health Leaders program facilitated by Hope Through Healing Hands, a nonprofit dedicated to advancing peace by supporting health care services and education in some of the world’s most vulnerable communities. Nurses, including the men and women I met at Vanderbilt, have an enormous opportunity to affect health and global health diplomacy. Indeed, everyone in the medical profession can play a crucial role in health diplomacy.
Global Health Diplomacy And Foreign Policy
For several years now I’ve been thinking about—and speaking about—global health diplomacy. The term started appearing around 2000 and has many definitions, representing the complexity of the issue itself. Diplomacy, at the simplest level, is a tool used in negotiating foreign policy. Health diplomacy is different, though. As a physician, the overall goal of health is clear: improve quality of life by improving health and meeting overall patient goals of care. As a diplomat and policymaker, the goal is more complicated.
Foreign policy, in general, is a dance—a negotiation of shared goals and identification of conflicts between nations, always with inherent tension. For example, what we want for the government of Afghanistan may not align with their complex political and cultural ideologies. Read the rest of this entry »
April 14th, 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 Oregon model.
How the country pays for health care is currently at odds with its vision of how health care should be delivered. Traditional fee-for-service health care payments are linked to the volume of visits, rather than the quality of patient-centered care.
To unlink payment from the volume of services provided and begin aligning it with value, Oregon recently launched the Alternative Payment Methodology (APM) demonstration project, where participating community health centers (CHCs)—aka federally qualified health centers—no longer earn revenue based on the number of individual patient seen. Instead, community health centers will receive a monthly payment based on the size and composition of their patient population, shifting the paradigm from the number of doctor visits to the provision of high-quality, team-based, patient-centered care.
APM is being piloted at three Oregon Community Health Centers: Virginia Garcia Memorial Health Center, Mosaic Medical, and OHSU Family Medicine at Richmond. The clinics are receiving technical assistance from the Oregon Primary Care Association (OPCA) and other community, regional and national partners.
With funding from the Robert Wood Johnson Foundation, a team of researchers from Oregon Health and Science University and OCHIN, one of the nation’s largest health information networks, is investigating the impact of APM on the delivery of primary care in safety-net populations. In addition to regular posts like this one, the research team will also share lessons learned and perspectives from key stakeholders on Frontiers of Health Care. Read the rest of this entry »
April 11th, 2014
Editor’s note: This post was updated on April 12 to conclude with a discussion of an April 11 CMS guidance explaining how the agency will ensure that the ACA risk corridor program remains budget neutral.
With the March 31, 2014 deadline for applying for qualified health plan coverage through the health insurance exchanges behind us, and the April 15, 2014 deadline for completing those applications upon us, Affordable Care Act implementation has quieted considerably. The Centers for Medicare and Medicaid Services have been very active on the Medicare front, releasing in recent days their 2015 Medicare Advantage Rate Announcement and Call Letter and publishing data on Medicare payments to 880,000 Medicare providers. But on the exchange and insurance market reform side, CMS has only one major proposed rule pending at this time, the Exchange and Insurance Market Standards Rule proposed in March, and nothing pending for regulatory review at the Office of Management and Budget.
I am unaware of any major regulatory issuances expected in the immediate future from the Departments of Treasury or Labor, although Treasury does have a number of proposed rules on the table that have yet to be finalized dealing with issues such as minimum value of employer coverage or premium tax credit reporting requirements for exchanges. Read the rest of this entry »
April 11th, 2014
Monday afternoon, the Centers for Medicare and Medicaid Services (CMS) released the final rates and other reimbursement policies for Medicare Advantage (MA) plans, referred to as the Final Call Letter. Once again, the Administration took pains to ameliorate planned cuts to MA, demonstrating the program’s increasing popularity with seniors and, by extension, its robust political strength.
For my money, we’ll look back at this year as the final hurdle the program jumped on its path to dominating the Medicare benefit for a generation to come. It’s already well on its way, covering 30 percent of Medicare beneficiaries and growing. So let’s take a quick tour of the MA program’s initially volatile history and the winning streak it’s been on of late, culminating with the breaks the Administration cut it this go round.
The past. First there was the growth and then precipitous decline of managed care in the 90s, a wave that the program – then called Medicare+Choice – rode alongside the commercial sector. Read the rest of this entry »