Posts Tagged ‘healthcare providers’

Senators Question CMS Rules for ACOs

Wednesday, August 24th, 2011

Some Senators want the rules for Accountable Care Organizations (ACOs) rewritten to increase their acceptance by providers. “An ACO model that can increase provider coordination and patient accountability would be a step in the right direction compared to today’s fragmented delivery system,” wrote the senators, led by Mike Enzi (R-WY) to Department of Health and Human Services (HHS) Secretary Kathleen Sebelius and Centers for Medicare and Medicaid Services (CMS) Administrator Dr. Donald Berwick. “However, it is increasingly clear that this proposed rule misses the target.”

According to the Senators, the ACO rules have misaligned incentives and accountability, as well as an unclear return on investment for physicians and other providers. The Senators highlighted healthcare providers who have raised concerns about the ACO rules, including the American Hospital Association, which released a study that estimated six to 14 times higher start-up costs for the new entities than estimated by CMS.

The AHA study determined that the costs of elements to successfully manage the care of a defined population is considerably higher – $11.6 to $26.1 million – than the $1.8 million estimated by CMS in its proposed rule for start-up and one year of operations. “CMS’ estimate falls short of the mark,” said Rich Umbdenstock, president and CEO of the AHA. “The shared savings rate with ACOs should be adjusted to reflect these costs in order to encourage and enable participation in this important program.” Specific areas of concern include network development and management , care coordination, quality improvement and utilization management ; clinical information systems; and data analytics.

In addition to Enzi, the letter was signed by Tom Coburn (R-OK); Jon Kyl R-AZ); Mike Crapo (R-ID); John Cornyn (R-TX); Pat Roberts (R-KS); and Richard Burr (R-NC).  According to Coburn, who is also a physician, “The letter I signed today echoes the reservations of health professionals who have expressed deep concerns about the well-intended, but ultimately unworkable, ACO regulations recently proposed by the administration. It is certainly my hope that the administration will not misread this letter as partisan, but will work to address the underlying problems of misaligned incentives and regulatory uncertainty that have elicited such concern by a range of health care institutions and providers. If the administration withdraws the regulation, they will find strong bipartisan support among Congress and stakeholders to craft a proposal that encourages broad participation in innovative models to achieve lower costs and better care.”

Berwick and CMS officials believe that organizations that participated in demonstration projects will back the rules because the results showed that Medicare saved more than $38 million in the years of the pilot program; the medical groups that participated got performance payments from the feds totaling more than $31 million. Among the participants are some of the nation’s most prestigious medical systems, including The Mayo Clinic, The Cleveland Clinic and the Geisinger Health System in western Pennsylvania.

Part of the problem, according to The Hill, is that budgetary concerns were the elephant in the room when the Obama administration wrote the proposed ACO rule. This resulted in regulations requiring stringent quality improvements that offered no upfront funding for hospitals to change their procedures. According to regulators, the proposed regulation is open for public comment and can be fine-tuned. CMS recently unveiled new tools to help hospitals start care coordination efforts, for example, by giving them the money they’re supposed to save Medicare through more efficient patient care.

According to the letter, “We have been struck by the increasingly diverse chorus of concerns many of our nation’s leading health care institutions have raised in recent days. The concerns…from some of our nation’s most knowledgeable and innovative health care providers are clear. Incentives and accountability are misaligned. Detailed requirements are complex and return on investment is uncertain.”

Although the Senators complimented the work put into the ACO rules draft, the letter said that feedback received from providers around the country brought the Senators to the conclusion that the proposed ACO regulation will not fulfill its purpose.

Another perspective is offered by Robert Tennant, a managing associate with Health Directions, who says that “I’d like to offer another point of view. Certainly, for most healthcare organizations, transitioning to an ACO will create short-term expense and disruption. At Health Directions, we are finding that healthcare organizations are not dismissing ACOs outright, but they are first asking: What do we stand to gain? In some cases the answer may be either not clear or not favorable. Regardless, there is a potential upside if the focus remains on increasing quality and efficiency of care delivery. As we weigh the future of ACOs, let’s not throw the baby out with the bathwater. The point of discussion needs to shift from whether or not to become a formally organized ACO down the road toward a more focused evaluation of which ACO-type elements are worth adopting now. A commitment to achieving meaningful use with an electronic health record (EHR) is a step in that direction, as is participating in a quality-driven pay for performance program. Both have short-term, well-defined financial rewards attached to them and both will likely increase quality of care. The key is for healthcare organizations to remain focused on the underlying thought behind ACOs — improving care and reducing costs. And that really is worth getting excited about.”

Electronic Health Records Are Great, But What About Privacy?

Wednesday, June 15th, 2011

Americans will be given a tool that helps them keep their personal information private if a proposed Department of Health and Human Services (HHS) rule is adopted.  The change in federal healthcare privacy laws proposed by HHS would give patients the right to see the name of any person who accessed their electronic health records, and what he or she did with them.  The “access reports” would be available from some healthcare providers as soon as January 1, 2013.  It would be similar to a free credit report — consumers would have the ability to request one report for free every year.  The move is the latest in an effort by the Obama administration to update and streamline the nation’s medical records system.

The proposed “access report” right has its roots in a provision of the 2009 stimulus package passed by Congress to start the economy moving and which contained $30 billion to encourage development of electronic healthcare records, called the Health Information Technology for Economic and Clinical Health (HITECH).  To ease concerns about the security of online health records, Congress told the HHS’  Office of Civil Rights (OCR) to strengthen consumer disclosure rights included in the Health Information Portability and Accountability Act (HIPAA).

“This proposed rule represents an important step in our continued efforts to promote accountability across the healthcare system, ensuring that providers properly safeguard private health information,” OCR Director Georgina Verdugo said.  “We need to protect peoples’ rights so that they know how their health information has been used or disclosed.”

In the proposed rule, HHS said the majority of providers oppose the change, because they believe it would be costly to implement and provide minimal consumer benefit.  Tena Friery, a HIPAA expert with the Privacy Rights Clearinghouse advocacy organization, disagrees, noting that the potential to identify who accessed a health record would be a significant disincentive to potential snoops.

Disclosure reports would summarize medical information transfers to entities such as law enforcement, judicial hearing or public health investigations, but would not explain the reason for the transaction.  Under the proposed rule, exchanges of medical information made via an electronic health records systems would not be included in a disclosure report.  “After careful consideration of this option, we concluded that accounting for such disclosures at this time would be overly burdensome when compared to the potential benefit to individuals,” the proposed rule states.

So just how prevalent are unauthorized views of Americans’ healthcare records?  The New York Times reports that the personal medical records of at least 7.8 million people have been improperly accessed in the past two years.  The Office of Civil Rights has a website dubbed the “wall of shame which lists 300 hospitals, doctors and insurance companies who have reported significant breaches of medical privacy.  The list reveals that major HMOs such as Kaiser Permanente Medical Care Program, New York Presbyterian Hospital and Columbia University Medical Center have experienced medical records security breaches.  These can occur when a laptop or other portable electronic device is lost or stolen.  An employee of Massachusetts General Hospital left the paper records of 192 patients on a Boston subway train.  Other reasons may be improper record disposal; hacking; and the unauthorized accessing of computer records.

Will Proposed Medicare Reform Leave Seniors Out in the Cold?

Monday, April 11th, 2011

A Congressional proposal to reform Medicare will transfer a significant share of the cost to the nation’s senior citizens – a constituency that is known for high voter turnout in elections.  The Congressional Budget Office (CBO) added fodder for critics, concluding that the majority of future retirees would pay considerably more for healthcare under the “Path to Prosperity” approach — which turns Medicare into a voucher-like plan for Americans who are currently 54 and younger.  Representative Paul Ryan

(R-WI), who introduced the plan, said “We don’t want to turn the safety net into a hammock that lulls people to lives of complacencies and dependencies, into a permanent condition where they never get on their feet.”  Instead of coverage for a set of prescribed benefits, Americans in their mid-50s and younger would receive a federal payment to purchase private insurance from a choice of government-regulated plans.  If the proposal becomes law, beginning in 2022, Americans would have a vastly different experience when they became eligible for Medicare.  The age for eligibility would rise from 65 to 67, according to the CBO.

Ryan’s proposal slashes $1.4 trillion from Medicaid over the next decade.  He proposes to cut $630 billion off the budget by more or less repealing the Patient Protection and Affordable Care Act’s provisions that extend coverage to include anyone living on less than 133 percent of the poverty rate — just under $30,000 for a family of four.  Additionally, Ryan’s plan eliminates subsidies for private insurance premiums for those just above the poverty line.  According to CBO estimates, nearly 17 million people without insurance would have been covered by the Medicaid expansion.

Representative Chris Van Hollen (D-MD), the ranking Budget Committee Democrat, said Republicans are protecting tax breaks for corporations and the wealthy to the detriment of the middle class and the poor.  “It doesn’t reform Medicare, it deforms and dismantles it,” Van Hollen said.  As for Medicaid, Ryan’s proposal “rips apart the safety net” for poor and older people.  “A typical beneficiary would spend more for healthcare under the proposal,” according to the CBO analysis.  “Although the uncertainty in future federal spending on healthcare would decrease under the proposal, that uncertainty would be transferred to future beneficiaries,” the CBO analysis said.  “If the volume, complexity, and costs of medical services turned out to be greater than expected, future beneficiaries would pay higher premiums and cost-sharing amount than are currently projected.”

Ryan’s budget resolution would improve the nation’s overall fiscal health, cutting projected deficits in President Obama‘s budget and moving the federal government towards a surplus by 2040, according to the non-partisan CBO.  Ryan believes that the cuts are necessary to save the programs.  “This is not a budget.  This is a cause,” he said.  “The social safety net is fraying at the seams.”  Chip Kahn, president of the Federation of American Hospitals, said that Ryan’s proposal would “result in the loss of health coverage for millions of low-income Americans, reduce critical benefits for others, and make it more difficult for hospitals, clinicians and other healthcare providers to deliver the care so many need.”  Other critics maintain that Ryan’s approach will shift the higher costs to individuals, much as the change from defined-benefit pensions to 401(k) plans has increased retirement risk.  Senior citizens, the disabled and the poor likely will pay more for healthcare, even as Washington pays less.  Additionally, Ryan’s plan would permanently extend George W. Bush’s tax cuts.

“The idealized notion that older consumers would be making these annual choices may have some merit as an idea, but it doesn’t seem to be taking place in practice,” said Patricia Neuman, director of the Medicare Policy Project at the non-partisan Kaiser Family Foundation.  Picking the right health plan could become even more critical if premiums outpace federal subsidies.  In 2010, 50 percent of the nation’s Medicare recipients reported incomes of less than $21,000 a year, according to a Kaiser Family Foundation analysis.

In an opinion piece in the Seattle Post-Intelligencer, the “Monday Morning Economist” Stephen Herrington writes “The tax cut proposal is not getting the attention it deserves.  If it shapes up to be anything like was described in Ryan’s Road Map, it will create massive dislocations and disruptions in the economy.  Ryan’s plan was/is to cut the top tax bracket from 35 percent to 25 percent with the promise/expectation that this would not impact revenues.  In a departure from the standard ‘trickle down’ excuse for tax cuts, Ryan meant/means to offset the admitted loss in revenues by eliminating all manner of deductions.  The deductions in our current tax code, such as medical, mortgage and state income tax expense are there for a purpose.  Eliminating them will introduce wild distortions in markets and effectively push the tax cuts for the rich onto the other 98 percent of us.  Elimination of the medical expense deduction will intensify the impact of the Medicare/Medicaid part of the plan.  It is as if Ryan thinks the magic of the free market can absorb any shock in real time.  No more mortgage deduction?  No problem, I just won’t buy a house at all until the lack of the mortgage deduction causes prices to fall by half.”

Deficit Reduction Commission Recommendations Will Hurt

Wednesday, November 24th, 2010

Medicare takes a hit from Deficit Reduction Committee proposals.  The bipartisan National Commission on Fiscal Responsibility and Reform will ask the Centers for Medicare and Medicaid Services (CMS) to create a new physician reimbursement system, increase Medicare cost sharing and create far-reaching medical malpractice liability reforms to cap non-economic and punitive damages.

The 50-page proposal supports cutting compensation for physicians and other healthcare providers.  At the same time, quality would be rewarded by speeding up payment reforms, increasing drug rebates and expanding Medicare cost sharing to promote healthcare choice and spending by consumers.  The commission wants to slow down federal health spending growth to match the GDP plus one percent after 2020 by “establishing a process to regularly evaluate cost growth and take additional steps as needed if projected savings do not materialize.”

The commission — chaired by Erskine Bowles, who served as chief of staff to President Bill Clinton and former Senator Alan Simpson (R-WY) — also proposed achieving healthcare savings by increasing accountable care organizations; bundling payments; slashing Medicare payments for bad debt; and reducing government funding for medical education, among other recommendations.  The likelihood of any of these recommendations being implemented is questionable as the proposal requires support from 14 of the commission’s 18 members to start a debate in Congress.

President Obama is taking a wait-and-see attitude.  “Before anybody starts shooting down proposals, I think we need to listen, we need to gather up all the facts,” he said. If people are, in fact, concerned about spending, debt, deficits and the future of our country, then they’re going to need to be armed with the information about the kinds of choices that are going to be involved, and we can’t just engage in political rhetoric.”  Obama said he will await the commission’s December 1 formal report before commenting further.

Medicare, Medicaid Head Rallies Insurance Companies

Thursday, September 30th, 2010

Controversial CMS chief wants insurers to work with healthcare providers to make reform work.CMS administrator Donald Berwick has asked the insurance industry to work in good faith to implement healthcare reform in a timely manner. Dr. Berwick made his plea at a Medicare conference sponsored by America’s Health Insurance Plans, the health insurance industry’s trade group.

“We need your help, our nation needs your help,” Dr. Berwick said, noting that companies, CEOs, healthcare professionals and managers all play a role in achieving the objective, yet the insurance industry “can be among the keys of our success, the central part in navigating the success of healthcare reform.  We have a job to do, we need to make care better for America.”  Berwick told the audience that he plans to work with others at CMS to build relationships and partnerships to assure that the Patient Protection and Affordable Care Act works as intended.  “If we steadily work together to make care what it can become, trust will resurface and the rest will follow,’ he said.

Dr. Berwick, who President Barack Obama named to his post in a recess appointment that bypassed the Senate confirmation process, is not well liked by Republicans because he once wrote an article that praised Britain’s National Health Service, raising concern that he will introduce healthcare rationing.  He tried to allay those fears by saying “I urge lower costs without harming a hair on any patient’s head.  It’s a clear, stark reality.  Our healthcare system, in its current form, is not up to that job.  We cannot, with our current system of care, give Americans the care that they need and want and deserve.”

The most pressing issue is improving patient safety and cutting deaths that result from unnecessary medical errors, a specialty that Dr. Berwick developed when he headed the Institute for Healthcare Improvement.  He also called for improved prevention and treatment of diseases like obesity and depression.

Healthcare Industry Offers Cost Savings

Thursday, July 16th, 2009

Healthcare providers will slash up to $1.7 trillion in costs over the next 10 years by enhancing the care of chronic diseases, reorganizing administrative procedures and eliminating unnecessary treatments.medical_bill

This is a sneak peak at how healthcare systems, physicians, pharmaceutical companies, insurers, medical device manufacturers and other stakeholders plan to respond to President Barack Obama’s request that the industry find ways to control patient costs.  Among the American Medical Association’s (AMA) suggestions are cutting overused – and often unnecessary — procedures, such as Caesarean sections.  The savings are crucial to funding the Obama administration’s proposed health system overhaul.

A new White House study states that reforming healthcare will increase the nation’s GDP by two percent in 2020 and eight percent in 2030, cut unemployment and save families an average of $2,600 a year by 2020.  Without healthcare reform, the number of uninsured Americans will rise to 72 million by 2040, compared with 46 million today.

Christina Romer, chair of the president’s Council of Economic Advisers, said “The one thing that’s happened relative to the 1990s is the nightmare scenario is getting closer.”  Other recommendations include reducing medical errors, using common insurance forms, improving physician performance standards, readmitting fewer patients to hospitals, improving drug development efficiency and expanding in-home care for patients with long-term illnesses.

Wellness Is a Proactive Approach to Healthcare

Wednesday, June 24th, 2009

Now is the time for healthcare providers to take a proactive approach to the well-being of their respective communities and target markets.  The American Recovery and Reinvestment Act (ARRA), signed into law by President Obama on February 17, contains $1 billion for the new Prevention and Wellness Fund.  This Fund will make available resources for funding immunization programs; infection prevention programs; and the prevention of mpj040515400001chronic diseases such as high blood pressure, diabetes and heart disease.  Based on statistics provided by the Center for Disease Control and Prevention, more than 70 million people in the United States (approximately 25 percent of our total population) live with cardiovascular disease.  Wellness programs have a direct impact on the prevention of these diseases and will be an important components of any preventative program.

Healthcare providers have historically been hesitant to invest in wellness and fitness centers due to the capital resource requirement and uncertain return on investment.  With careful planning and strategic development, these facilities can bring a substantial new revenue stream into the organization.  Skeptics may point to the Medical Fitness Association, which reports that in 2008 there were approximately 950 medically based wellness and fitness centers in the United States, with one-third reporting operating losses.

While such risks do exist, investing in wellness facilities and programs that directly address the prevention of chronic disease have the potential for more than satisfactory financial results.  If managed with a clear direction, thought and competence, these facilities can provide a financial return far more attractive than the equities market has offered in the recent past.  The resources allocated to fight chronic disease will come back tenfold in cost reductions over the long term.

Now is the time to invest in the well-being of our future.  We should not wait for another opportunity like the one Congress and President Obama have provided.  We need to take advantage of this now.