Hospitalists' Take on Baucus Bill

From The Hospitalist Web site

Addition of a hospital value-based purchasing (VBP) program to Medicare beginning in 2012. The program would tie incentive payments to performance on quality measures related to such conditions as heart failure, pneumonia, surgical care, and patient perceptions of care. So far, the program’s rough outlines have been well received. “We fundamentally support hospital value-based purchasing,” Dr. Siegal says. “We think it’s a necessary step in the evolution to higher-value health care in general.”

Expansion of the Physician’s Quality Reporting Initiative, with a 1% payment penalty by 2012 for nonparticipants. The bill also would direct the Centers for Medicare and Medicaid Services (CMS) to improve the appeals process and feedback mechanism. Although the Baucus plan’s “mark” doesn’t discuss transitioning to pay-for-performance, Dr. Siegal says the shift likely is inevitable. In the meantime, pay-for-reporting can encourage better outcomes through a public reporting mechanism and “grease the skids” for a pay-for-performance initiative.

Creation of a CMS Payment Innovation Center “authorized to test, evaluate, and expand different payment structures and methodologies,” with a goal of improving quality and reducing Medicare costs. Dr. Siegal says the proposal is consistent with SHM’s aims. “We have for a long time advocated for a robust capability to test new payment models and to figure out what works better than what we have right now,” he says.

Establishment of a three-year Medicare pilot called the Community Care Transitions Program. The program would spend $500 million over 10years on efforts to reduce preventable rehospitalizations. SHM’s Project BOOST (Better Outcomes for Older Adults through Safe Transitions) likely would qualify. “We’re very positive about that,” Dr. Siegal says. “I think there is a huge amount of scrutiny now on avoidable rehospitalizations. We think BOOST is a step in the right direction, and we’d love to see greater funding to roll this out on a much larger basis.”

For more information on the current healthcare reform debate, visit SHM’s advocacy portal.

Bryn Nelson wrote the piece for The Hospitalist, and Eric Siegal, MD, is chair of the Society of Hospital Medicine's Public Policy Committee.

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Baucus Watch, Public Option issues: Columbia Journalsm Review

Baucus Watch, Part X : CJR:

Columbia Journalism review tries to get reporters to focus on the substance of the Public Option debate, rather than on the horse-race, who's up, who's down BS they generally like to cover 'cause it's easier and more fun. As a reminder of the thinking in general, you can read more about the "weak" vs. "strong" public plan options here.

"To move this story—and it’s an important one—beyond the process of reform to the substance of reform, we offer a few questions for reporters:
• Who will really be able to join a public plan—everyone, or just those who don’t have other coverage or are too ill for insurers to take them on as customers?
• Can workers with coverage from their employers go to a public plan if it’s cheaper? In other words, is there a real choice for everyone?
• How will coverage be financed—by taxpayer dollars, or by premiums from people needing insurance?
• Will the government provide the coverage, as it does for Medicare’s hospital and doctor benefits, or will private insurers provide it, as they do for Medicare’s prescription drug benefit? There’s a big difference here.
• What will the benefit package look like? Which special interests are working to make sure that their latest gee-whiz technology gets covered?
• Will doctors and hospitals be paid the Medicare rates, or something higher?
• If they get the higher rates, then where will the cost-savings come from?
• If private carriers provide the benefits with more of the same inefficient billing costs, where will the administrative savings come from?"

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A Public Health Insurance Plan | OurFuture.org

A Public Health Insurance Plan OurFuture.org:

As the ball rolls along in our debate, one thing that keeps coming up is the idea that everyone must have insurance. Being forced to buy insurance from a private insurer ($15K a year at our house - from a "not-for-profit" !) is obviously not an option for most, especially considering the median family income is only about $60K. Medicare spends anywhere from $6K to $14K per enrollee (65 and over, mind you). So can a public option be the solution?

Here are the key findings of the report, but you can click the link above to get the full report, an executive summary and a PowerPoint show.

The report contains these findings:
• Medicare has controlled health care costs much better than have private health insurers over the last 25 years.
• The private insurance market is highly consolidated and needs competition from a public health insurance plan to lower skyrocketing premiums.
• Administrative costs are dramatically lower under public health insurance plans,
resulting in enormous savings to the system.
• The bargaining power of public health insurance plans significantly reduces provider costs.
• In a head-to-head competition, the public Medicare plan is much better at containing costs than private Medicare Advantage plans.
• Independent analyses show substantial savings can be achieved from a public health insurance plan that competes with private insurance plans.
• Quality and effectiveness innovations occurring under the public Medicare plan show that public health insurance plans have greater potential to drive the quality revolution than do private plans.
• Public health insurance plans increase choice, competition and accountability.

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Real Health Care Reform in 2009 - Brookings Institution

Real Health Care Reform in 2009 - Brookings Institution:

If you click on the link above, it will take you to the page for the event at Brookings. I learned a lot from it. Below, I've pulled interesting quotes from the transcript which may be useful at some point in the near future. My comments are in italics, the quotes are regular font.

Opening Remarks: Political Prospects for Reform - Sen. Max Baucus

The link to Baucus' "Call to Action in 2009" Website, and some analysis from the National Journal.

He didn't say much new here, just that we were in a crisis and he wanted a bipartisan solution.

Panel 1: Opportunities for Improving Health Care » (.mp3)
Donna Shalala – Moderator
Michael Porter, Harvard Business School
Don Berwick, Institute for Healthcare Improvement
Carolyn Clancy, Agency for Healthcare Research and Quality


Berwick: "the big problem of value that Mike refers to. I disagree slightly with Michael although it's only because I'm wrong and haven't understood him thoroughly yet, but I also think the problem is cost. It's total cost. It is manifestly possible for a Western democracy to give all the care its population needs for about 10 percent of GDP. It is possible. You can't say it's not possible because it's being done. We're at 16 percent or 17 percent. We're wasting probably 40 percent or 30 percent of the dollars we're putting into health care. That's true and I don't understand, Michael I know will come at me on this, why we just don't target that as an aim, reduce the total cost. Thirty percent waste easily in our system. I think he wants to get there by working on quality and value and that's probably right, but don't take your eye off the ball. "

Berwick: "...integrated care for chronic illness and the gaps there in. The Commonwealth Fund is now our lead, I guess, scrutinizer of that problem. Seventy percent of costs go into chronic illness care. Probably half of it is pure waste. And a lot of it happens because we don’t have the integrated flows that we need for a restructured care system.
"The third really might be American exceptionalism. It’s our inability to learn from successful models outside of this country. Countries that function with better care than we have; we are 19th out of 19. That’s OECD data, that’s what Senator Baucus said and he’s right, compared to countries that are functioning at 60 or 70 cents on our health care dollar.
"We’ve got to learn from these other models and not throw them away because we assume that stuff like that doesn’t work here. It will. It’s our decision, what we choose we can choose to change."

Berwick: "My wife is Under Secretary for Energy in Massachusetts and she has taught me about decoupling in the energy world where utilities now in at least 20 states or so, aren’t paid for volume. They can make as much money by saving a kilowatt as by making one. We need to do that with care. You ought to be able to somehow treat an empty bed as an asset. Right now we don’t do that at all. "

Hmmm. No quotables from anybody except Don Berwick...

Panel 2: Policy Reforms to Improve Health Care Delivery » (.mp3)
Mark McClellan – Moderator
Alice Rivlin, Brookings
Elliott Fisher, Dartmouth
Denis Cortese, Mayo Clinic

Fisher: [Highlights first barrier as system fragmentation.]

"The second barrier I would highlight is out current payment system, which is truly toxic, supply driven, and will be hard to change. "

..."And many of the current initiatives, whether it’s pay for value, episode-based payments as they are currently being considered or even the medical home model. Risks reinforcing the fragmentation in our current system and certainly won’t slow the growth of health care costs. As long as we can have specialists continue to purchase new services, see their patients at their current rates the medical home will be powerless to deflect the growth of spending in the acute sector on the specialist side. Without creating that medical neighborhood that they can work effectively in. "

"The third barrier I’d highlight is that I think many of our policy initiatives currently conflict with each other or compete with the provider’s attention and are an increasing burden to the practice of clinical medicine. Whether it’s performance measure, pay-for-performance initiatives, they’re all going and not thought through carefully. So let me make three suggestions as to strategies that we might consider. "

Rivlin: "The title of this session is rather polite. It’s getting to higher quality, better value, and sustainable coverage. That’s a polite way of saying the current system is wasteful, excessively costly, often provides poor quality, even harmful care and the number of the uninsured is growing and we have to do something about that.

"The number one imperative in health care reform is moving toward the system that gives us more health for the large number of dollars we already spend and slows the arte of growth of health care spending for the future. If we can’t do that, we won’t have a sustainable health insurance system and we won’t have a sustainable Federal budget.

"Now it’s often said that we cannot effectively reduce the rate of growth of health care spending until we move to universal coverage. And we’re all for universal coverage, but the opposite is more nearly true. We cannot get to universal coverage, we cannot expand coverage unless we find a way to control costs and improve quality. Adding more claimants to the existing system will only exacerbate the current problems of rapid increase in spending and poorer quality.

"So where to start? Well, we actually already have universal coverage and a single payer in a huge piece of the system called Medicare. And I think we must, initially, use Medicare to lead the way to a system that rewards effective treatment and discourages waste and inefficiency. "

Cortese:"Every Congressman you talk to when you say what’s the number one problem in healthcare in the United States? They say "we’re not getting what we pay for." The unfortunate answer to that statement is "oh, yes you are." That’s the saddest component. We are -- this country has gone so far to make sure we are paying for non-value that somebody’s got to stand up and say it is time to pay for value.

[Review of 4 principles of reform of Mayo found here.]

Panel 3: Talking About Reform: New Directions for Involving the Public » (.mp3)
Susan Dentzer, Health Affairs – Moderator
Neil Newhouse, Public Opinion Strategies
Stan Greenberg, Greenberg Quinlan Rosner
Jim Guest, Consumers Union

Dentzer: "...most of us will remember the famous comment made by an elderly woman who ran into Senator -- then Senator -- John Breaux in an airport in Louisiana and applauded him for his efforts on health reform, and then said to him "but Senator, whatever you do, don’t let the government take over my Medicare." This being thought of as the emblematic piece of public opinion on healthcare reform and underscoring Congressman Barney Frank’s famous statement that "people complain about the politicians, but the voters aren’t so hot either."

"The Commonwealth Fund surveys show three-quarters of the public or more wanting a completely rebuilt healthcare system or one that is improved in major ways.

Newhouse: "One-third of Americans believe the healthcare system in the country needs to be radically changed, 51 percent reformed, just 12 percent status quo. Remarkable numbers and from that we would obviously take that there is a significant sentiment for change. Next one. And yet 71 percent say they’re happy with their own healthcare compared to 24 percent say they believe that the healthcare in the country is going well.

Greenberg: "I remember the failing of the Clinton healthcare plan. I remember the battle over trying to get the unions to support us in order to advance the plan. It was a struggle to get union support until it was decided whether Cadillac healthcare plans were going to be taxed –- I think it was $5,000 at the time, but the issue of taxing Cadillac plans kept unions back. Unions, many of the industrial unions sector were not that sure that this plan was one they wanted to support, were in a totally different place. Those, as we’ve seen in the auto industry, know that their insurance is at risk; the service sector unions are much stronger.

"When we tried to get the DNC and others to pay for ads for support of the plan, we had –- it was a couple million dollars for the total effort on behalf of the healthcare plan. We’re dealing with a total shift of civil society, which I think puts this in an entirely different context. The Clinton healthcare plan died in committee. Can you imagine in this environment if you came forward with a healthcare plan and it got in trouble in the Energy and Commerce Committee and Nancy Pelosi or the leadership of the Congress or the president saying okay, that’s the end of healthcare, we’re not going to go forward?

"When you get to healthcare, people are more nervous and more risk reverse about the kinds of changes you make. So, while we’re going to operate in an environment which I think there will be momentum for change and they’ll be engagement of public to move the process forward, the public is not -– almost half the public wants to move boldly and half wants to move carefully, and, so, you’ve now a risk averse public which obviously creates opportunity for those who don’t want to see it happen.

MR. NEWHOUSE: "But don’t you think if they do this in an initial wave that it’s got to be step-by-step, piecemeal, kind of incremental approach rather than major healthcare reform? And how do they sell it? Do they sell it as major healthcare reform or do they sell it as steps to improve healthcare?"

MR. GREENBERG: "No, I think it’s got to be big change, but it may be that it’s step-by-step over 10 years to get there, but I think they got to know where it’s going. "

MR. NEWHOUSE: "You know what’s interesting is just as we showed poll data here showing how difficult it is, the political environment actually makes this a little bit easier for Barack Obama. The mood in the country –- Stan and I have polled all over the world. We had, what, 10 percent right direction in this country? There are a few countries around the world that had lower than 10 percent of people saying the country is heading in the right direction.
The sense for change here is extraordinary, and Barack Obama has the opportunity to really use that mandate and begin to form this mandate for change. "

Panel 4: Moving Forward on Reform: Discussion and Political Perspectives » (.mp3)
Mark McClellan and Chris Jennings – Moderators
Sen. Richard Burr
Sen. Sheldon Whitehouse

Jennnings: "And I have to say that even this issue of the uninsured has started to -– people are starting to understand that people aren’t looking at the uninsured as an issue as it relates to the more obliged so much as the cost shifting that is associated with the uninsured, and they’re also looking about the uninsured about if the real problems in our healthcare system are our inability to prevent and to manage the chronically ill population substantially well, how do you do that without covering populations in significant ways? How do you do prevention well? How do you do chronic care management well? How do you eliminate cost shifting? "

SENATOR WHITEHOUSE: "I'm particularly honored to be here with my colleague Senator Burr. The group that he's referring to could probably be called the bookends club, because it's me and Sherrod Brown and Richard and Tom Coburn, and I would suspect that 90 percent of the Senate is between us, and -- nevertheless, we have had very, very good discussions, and as you've just heard Richard lay out his top four principles, there's not a whole lot that I would disagree with in those.

"I think that we are at a new place. I think that the entrenchment that would well establish politically around the finance and access questions dating back to '93 has been somewhat made a little bit out of date by this whole new discussion that we've had, particularly today, about quality and prevention and delivery system reform. And so there aren't positions that are as hardened there as in the old debate, and I think we're also getting a new sense of urgency that is common on both sides of the aisle. "

Whitehouse: "In Rhode Island, you know, years ago when I started the Quality Institute, we brought the Keystone Michigan Intensive Care Unit forum to Rhode Island to go statewide, and the hospitals were, you know, okay with the idea, but they said look, you've got to understand our problem. We can do this. It'll probably cost us $400,000 per intensive care unit per year. We think we might save $8 million per intensive care unit per year, at which point I interrupt, you know, ignorantly, and say well, great, 20-to-1 payback, go. And they say, no, no, no, you don't understand, that $8 million comes off our top line, and the $400,000 comes out of our very scarce cash flow, and at the bottom line there's really very little benefit to us for doing this. When we understand that problem, which is one of the fundamental problems of the quality failure we're having, then we can set up the right mechanisms to get it addressed so that when a hospital is willing to invest in quality improvement, it sees a reward for that, and there are a lot of different ways to get to it, but I think the most important thing is we've got to have -- as I said earlier, we've got to have situational awareness about what our problem is. Once we do that, some of the stuff actually is pretty simple and straightforward, and I agree with you, I don't think Congress should get right down into the final details. "

The bulk of this discussion is between the two Senators and relates to process inside the Congress.

Cheers, Chris

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Health Beat: Herzlinger’s Meme on Switzerland and Consumer Driven Medicine

Health Beat: Herzlinger’s Meme on Switzerland and Consumer Driven Medicine:

"Yet even if the Swiss are not the world’s most conscientious health care shoppers, individuals in Switzerland spend about a third less on health care than the average American. How can that be? Time and again, Herzlinger repeats the meme that consumer choice accounts for Switzerland’s lower costs. And if she says it often enough, without citing evidence, no doubt many Americans will believe her. But it just isn’t so.

Even a cursory glance at Switzerland’s system reveals that government-enforced price controls on virtually everything from drugs to doctors keeps a lid on health care inflation. The fees that providers charge “are negotiated by the cartel-like associations of insurers and clinicians under the watchful eye and heavy hand of government” Reinhardt observes. And “since all insurers are bound to the same prices for ambulatory care, and prices are negotiated between insurers and individual hospitals for inpatient care,” there is little room for the consumer to affect prices by comparison-shopping.

Finally, when it comes to ensuring that the Swiss are receiving effective care, Switzerland's Federal Department of Home Affairs establishes the formulary for prescription drugs that it believes give good value, while the Federal Department of Home Affairs decides which lab tests and medical devices are to be covered by compulsory insurance.

In the end, Reinhardt suggests that “what is most impressive about the Swiss health system is the role tight government regulation plays . . . . One can plausibly argue that this regulation is chiefly responsible for both the high quality and (relative to the United States) low cost of Swiss health care.” Determined to make the case for consumer-driven care, Herzlinger takes the opposite view arguing, in today’s WSJ that the Swiss government’s web of regulations, requiring “an extensive minimum benefit package,” while “micromanaging” both prices and products is precisely what keeps Switzerland from becoming the unfettered consumer’s paradise that she would like to see. "

A nice overview of the Swiss system and a Bronx cheer to the crapola that is "Consumer Driven Healthcare". Thanks to Ian Welsh of Firedoglake for the link from his piece on the Baucus Plan...

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