The most recent Health Wonk Review, hosted by Joe Paduda at Managed Care Matters, raises provocative questions about making health care reform a reality. You’ll find Paduda’s round-up of some of the meatiest health care posts that have appeared on the blogosphere in recent weeks here: http://www.joepaduda.com/archives/001888.html
Below, a summary of just a few posts, with my thoughts on the topics. If I had more time, I would write about all of them. I urge you to check out the entire Review.
Gawande: “All Health Care Is Local”
Paduda begins by highlighting Boston Health News, where Tinker Ready quotes Dr. Atul Gawande saying that “all health care is local.” Ready reports that at a recent health care quality colloquium at Harvard, “Gawande made the case for locally driven reform . . .. Communities, he said, need to find ways to create working systems out of the complex, fragmented elements of medicine.” See Ready’s post here http://tinkerready.wordpress.com/2010/08/17/bhn-exclusive-gawande-on-reform-all-health-care-is-local/
I agree. When it comes to health care reform, different strategies will work in different regions. In some places, Accountable Care Organizations will thrive; in other medical cultures, doctors will reject the idea of working on salary for a large organization, though they may be willing to take responsibility for outcomes by being paid a lump sum each year to keep a patient well (capitated care.) In other cities, newly expanded community clinics will succeed in becoming “medical homes.” In most states, experience suggests that Nurse Practitioners will be accepted (by both patients and doctors) as primary care providers. But in other places physicians and patients just won’t be comfortable with the idea.
That said, I believe this: when it comes to treatment we need national evidence-based guidelines (not rules), recommending the most effective treatments for patients who fit a particular medical profile. The medical evidence that generates these guidelines doesn’t vary by location: it does not matter whether you live in Dallas or Dubuque. But when it comes to the question of how health care is organized and delivered, and how we pay for it– this is a large country. Different strokes. . . .
Often, as Gawande suggests, the best solution may come from within the local medical culture. As I’ve noted in the past, in some communities healthcare leaders are already reforming local care by moving away from fee-for-service care, and replacing competition with collaboration as doctors and hospitals come together to reduce waste. http://www.healthbeatblog.com/2009/08/proof-that-american-physicians-and-hospitals-can-lift-quality-and-reduce-costs.html
In the summer of 2009, a conference titled “How Do They Do That? Low-Cost, High Quality Health Care in America” called attention to success in ten very different cities across the nation: Sacramento, CA; Cedar Rapids, IA; Portland, ME; Ashville, NC; Sayre, PA; Temple, TX; Richmond, VA; Everett, WA; La Crosse, WI; and Tallahassee, FL. http://healthaffairs.org/blog/2009/07/28/low-cost-high-quality-care-in-america/
Who Should Rein in Health Care Inflation—Insurers or Gov’t?
I’m glad that Paduda included a post from his own blog in the round-up. It’s titled “Managing Health Care Costs—Whose Job Is It?”– and it made me think. See the post here http://www.joepaduda.com/archives/001885.html
Paduda argues that private health insurers should—and could—push back against rising health care costs by setting up smaller, more exclusive provider networks. Today, he notes, “negotiating power has shifted back towards providers, and that shift is contributing to higher costs for health plans.”
It’s not surprising that providers charge as much as the market will bear, says Paduda: “Suppliers in any business seek to maximize profits. Smart buyers will figure out how to find more cost-effective suppliers, develop alternative supply chains, or in very tight supply markets even resort to vertical integration, setting up their own suppliers.
“I see no reason health plans can't do the same. There's far too much 'old thinking' among health plans,” he argues. “They remain overly concerned with the size of their network directory, believing large provider networks are essential to success.
“Clearly, nothing could be further from the case,” Paduda adds. “Some health plans are beginning to experiment with smaller, more exclusive networks, and I have no doubt the lower costs will make them much more attractive than the 'old school' huge networks with high costs due to broad access. No, success will come to those payers who creatively figure out how to work closely with selected providers, establishing partnerships, paying fairly, sharing information, and providing feedback.
“Otherwise,” Paduda concludes, “they're just administrators, and not very efficient ones at that. If health plans are going to rely on the government to control costs, what, precisely, are health plans for?”
In that last line he raises a crucial question. Private for-profit-health plans are going to have to show that they are adding value to the system, or they are not going to survive reform.
Paduda suggests that if insurers set up smaller networks of doctors and hospitals, charged lower premiums, and advertised their networks as more efficient, they could attract patients to tighter, high quality networks.
It’s a very smart idea. But I have to admit that I’m somewhat skeptical. American patients have been trained to believe that they should have as many choices as possible: most greatly prefer large networks, especially in parts of the country where doctors work in small or solo practices.
Moreover, the insurer who did this would be faced with the challenge of working with providers to make sure that care was excellent– and less expensive only because hospitals reduced errors and its doctors did a better job of collaborating.
This is a Herculean task. Typically, hospitals and doctors are not terribly enthusiastic about taking advice from insurance companies. Unless the providers work for the insurer, I am afraid that most insurance companies would fail in this endeavor.
On the other hand, integrated systems, in which providers and the insurer are part of one larger company, could be a solution—at least in some places. Organizations such as Geisinger and Kaiser Permanente have made great strides. What Paduda refers to as “vertical integration” might well work.
But we still need someone to begin to reduce the waste in the larger fragmented system where most doctors and hospitals are not willing to become part of a larger organization. Today, we know that in our disorganized health care system, a combination of overtreatment and medical errors adds billions to the nation’s health care bill.
For example, avoidable medical errors cost the nation $19.5 billion in 2008, according to a claims-based study conducted by Milliman, Inc. on behalf of the Society of Actuaries (SOA). http://www.soa.org/research/health/research-econ-measurement.aspx. Most of that amount, $17 billion, was the cost of providing inpatient, outpatient and prescription drug services to individuals affected by medical errors, says Jim Toole, chairman of SOA.
Milliman consultant Jonathan Shreve, a co-author of the report, says the estimate is conservative: "This number includes only the errors that we could identify through claims data, so the total economic impact of medical errors is in fact greater than what we have reported."
The report listed the 10 most expensive types of errors in 2008, the number of errors, the cost per error, and the total cost. At the top of the list
- Pressure ulcers (a.k.a. bedsores) 374,964 errors, $10,288 per error and $3.858 billion total.
- Postoperative infections—252,695 errors, $14,548 per error, $3.676 billion total.
Not all errors are avoidable, but many, including bedsores, often are. Caregivers need to identify patients at risk, check their skin daily, and move them often. This is labor intensive, but less expensive than letting bedsores fester at a total cost of $3.858 billion. (It is extremely difficult to cure bedsores, less expensive to prevent them.)
When it comes to reducing medical errors and infections, I don’t think that private insurers can do the job. Only the government—i.e. Medicare– has the size, and the clout, to influence providers.
Virtually no hospital in the U.S. could stay open without Medicare patients. Thus, Medicare is in a position to make patient safety a priority for U.S. hospitals. And it plans to do just that.
Under reform legislation, beginning in 2015, Medicare will reduce its payments by 1% to hospitals with the highest rate of medical errors and infections. Medicare will also stop paying for preventable readmissions, often caused by discharging patients still suffering from hospital-acquired infections.
And in 2015, HHS will start reporting each hospital's record for medical errors and infections pertaining to Medicare patients. This could have a significant effect on a hospital’s reputation, and will give hospital CEOs an incentive to invest more in patient safety.
Private Insurers at Their Worst
When it comes to for-profit insurers, Paduda may be more hopeful than I am, but he’s no Pollyanna. In his review of the best of healthcare posts, he highlights a piece by Health Care Renewal’s Roy Poses which reveals the dark side of the private health insurance industry. “Roy Poses digs deep into Wellpoint’s rate increase and finds out that the employee tasked with announcing the increases had serious concerns, concerns that may have led to her termination. As always, Roy finds the truth and does some of the best reporting in the blogosphere.” (I agree.) You’ll find the post here. http://hcrenewal.blogspot.com/2010/08/being-health-insurance-executive-means.html
Briefly, Posts tells the tale of Leslie Margolin who became “the public face of Anthem this year when it sought to raise individual insurance rates as much as 39%. The move triggered a backlash in Washington and Sacramento, where lawmakers accused Margolin and her corporate bosses at insurance giant WellPoint Inc. of trying to gouge unknowing policyholders. . .
“In a March talk at Pepperdine University's business school,” Poses reports, “Margolin told a gathering of students and business leaders that she wasn't responsible for rate increases she believed were ill-timed and ill-advised.
'We have impacted individual consumers in ways that were so significant for those individuals,' she said. 'And for that, I personally feel very, very sorry.'
“As she made the Pepperdine appearance and others, Margolin said, she privately pressed WellPoint to abandon the company's get-tough approach to longtime adversaries — doctors and hospitals — and instead collaborate as part of a new 'healthcare transformation strategy' to cut costs and improve patient safety and the quality of care.”
(This, of course, is exactly what Paduda rightly suggests that insurers should do—if they want to show that they can add value to the system.)
But, Poses continues: “So what happened to Ms Margolin? Did she get a big raise and an award for doing the right thing? Is the moon made of green cheese?
“In fact, here is what happens to a health insurance executive who says she is sorry for excessively high insurance rates:
“Last month, WellPoint replaced her. . . . Interviews with company insiders, insurance industry leaders and others familiar with the situation make clear that she was pushed out. . .
“In fact, her exit was quite inglorious,” Poses adds: “Margolin vividly recalls her last day. Even though her Anthem team was exceeding its financial goals and membership numbers, she said, she was ushered from the doors of Anthem's Woodland Hills headquarters. She didn't have a chance to send a farewell message to her 400 employees”
Palliative Care in the ER
Finally, Paduda turns to a post by the New America Foundation’s Joanne Kenen on New Health Dialogue, writing about the need for palliative care in the ER. http://health.newamerica.net/b logposts/2010/health_care_palliative_care_and_primary_care-35483
This post links back to a piece Kennen recently published on Slate, describing how physicians who are “board-certified in both palliative and emergency medicine, hope to bring the deliberative goal-setting, symptom-controlling ethos of palliative care into the adrenaline-charged, ‘tube 'em and move 'em’ ER. http://www.slate.com/id/2262769
“Palliative/emergency medicine collaboration remains rare,” she writes, “but it's growing as both fields seek to create a more ‘patient-centered’ approach to emergency care for the seriously ill or the dying, to improve symptom management, enhance family support, and ensure that the patient understands the likely outcomes. “
This is a new frontier for palliative care, but an important one. As Kennen points out, “one in 500 ER patients—200,000 a year—dies under the bright lights of the emergency rooms. Another 500,000—3 percent—die during hospital stays following emergency treatment. Countless patients learn, from a doctor they have never seen before and may never see again, that they have fatal diseases.”
Traditionally, doctors have been taught that their jobs are to save lives. Death is something to shun, none of their business. But in a new world of more compassionate, patient-centered medicine, caregivers are beginning to recognize that death is indeed, part of their business: it is an integral part of life. As Dr. Diane Meier observes in Palliative Care: Transforming the Care of Serious Illness (Jossey-Bass, 2010) “Those practicing palliative care practice the most ancient of goals in practicing medicine—the relief of human suffering.” That includes helping dying patients come to terms with the fact that they are dying. (I’ll be writing more about Meier’s superb book in a future post. )