Healthcare organizations in New Jersey announced this week a new statewide initiative aimed at reducing hospital readmissions related to heart failure through better care and closer provider collaboration.
More than 50 organizations—including hospitals, nursing homes, home health providers, and hospice organizations—will participate in the effort, which is being spearheaded by the New Jersey Hospital Association through its Institute for Quality and Patient Safety.
In addition to sharing data and best practices, each organization will send representatives to a series of learning sessions that will provide a better understanding of why patients are being readmitted to hospitals and what providers can do to reduce readmissions.
Each year over 1 million people are admitted to an inpatient setting for heart failure nationwide, and 27% of those patients who are on Medicare are readmitted within 30 days, according to a recent report. In fact, heart failure is one the most frequent reasons for rehospitalization, which costs Medicare up to $17.4 billion annually.
"Hospital readmissions are a very complex issue, with many factors beyond the control of healthcare providers. Some readmissions are simply unavoidable. But we all know there is always more to be done to make our healthcare system more efficient," said NJHA President and CEO Betsy Ryan in a release.
The New Jersey effort follows similar initiatives focused on heart failure readmissions launched this year in Pennsylvania and Michigan. Last year, the American College of Cardiology launched an effort to cut the national Medicare heart failure readmission rate by 20% by the end of 2012.
One of the goals of the New Jersey program will be to involve patients as well as providers. The organizations hope to develop resources to help hospitals and post-acute facilities improve heart failure care, as well as resources to help patients better manage their own care at home.
Improving the frequency and quality of follow-up care may be one key to making the initiative successful. A study published last month in the Journal of the American Medical Association found that early outpatient follow-up after an initial hospitalization reduces the risk of readmission within 30 days.
Although the New Jersey initiative is only planned for one year, the organizations plan on using the best practices and information developed for heart failure readmissions to reduce readmissions for other patient populations, such as diabetics and patients with pneumonia.
Cutting or changing physician reimbursement doesn't always produce the desired cost savings, as physicians are likely to increase services or switch to more profitable treatments after a cut, according to a new study.
The study, which appears in the latest issue of Health Affairs, examined how oncologist treatment patterns for lung cancer changed after the Medicare Modernization Act reduced payments for certain chemotherapy drugs beginning in 2005. Officials at the time were aware that Medicare had been overpaying for outpatient chemotherapy—sometimes at six times the actual cost—and hoped a change in how the drugs were reimbursed would help lower costs, says Mireille Jacobson, lead researcher on the study and senior economist at the RAND corporation.
But physicians recouped the losses from the drop in reimbursement by increasing the amount of chemotherapy administered overall and switching from drugs with the largest cuts in profitability—carboplatin and paclitaxel—to other high-margin drugs.
"These changes may have offset some of the savings projected from passage of the bill," the authors wrote in their report.
The average profit margin on chemotherapy reimbursements dropped from about 22% above the cost of the drug in 2004 to roughly 6% the following year. In addition to changing how they utilized chemotherapy, there is also anecdotal evidence that some physicians invested more in imaging and looked for other ways to offset the drop in revenue.
Although the study was narrow in scope and measured the effects of a very specific reimbursement cut, the findings have implications for broader Medicare cuts and payment reform, Jacobson says.
"I think the lesson is really an old one, that we have failed to pay attention to," she says. "We need to think not only about making the cuts, but also behavioral responses to those cuts and how that offsets any savings."
Previous studies suggest that if Congress is unable to delay or eliminate the looming 21% cut in Medicare payments to physicians, many physicians will either increase utilization or find other ways to make up for the reduction. Typically, when a cut only affects a small portion of a physician's overall practice, he or she is more likely to drop the service altogether, Jacobson says. So doctors who don't rely heavily on Medicare right now may be willing to drop the payer altogether if reimbursement falls.
But physicians whose incomes depend heavily on Medicare payments may instead use even more expensive tests and treatments.
The authors of the study urge caution, not only in passing cuts, but also in approaching long-term payment reform. "Any redesign requires an understanding of both the value of services and the impact of changing reimbursements on the use of those services," the write.
If you want physicians as a group to focus more on quality, pay them based on performance. If you want employees to quit smoking or follow routine wellness programs, give them cash incentives. If you want to remind patients to take their medication, pay them with a lottery.
Sometimes it seems that paying cash is the only way to get anyone to do anything, even when inaction is potentially life threatening.
The New York Times has an interesting profile this week of an Aetna-sponsored program in Philadelphia that paid patients who had been prescribed warfarin for remembering to take their medication. A computerized pillbox recorded whether or not patients took the correct dosage each day and awarded a $10 or $100 lottery payment to those who did.
And for some patients, it really worked. One patient said the lottery was like a game and made him look forward to taking his medication, and another went back to forgetting to take her pills, or incorrectly taking two a day, when the lottery ended.
It is discouraging to discover that saying, "It will improve your health or possibly save your life," isn't enough to convince a lot of patients to comply with medication instructions or live a healthier lifestyle. But if words alone were enough to change ingrained behaviors, health problems would be a lot easier to solve.
There are many cases where paying patients (or even providers and others involved in healthcare) not only works, but it is a good investment. Between one-third and one-half of all patients don't take prescriptions as prescribed, costing up to $100 billion annually when some of those patients get sicker and end up in the hospital, according to the Times.
The $90-a-month that patients received on the warfarin study will pay for itself if it prevents just two emergency clinic visits, said the University of Pennsylvania Medical School professors who led the project.
But that doesn't mean that throwing cash around is the way to solve every health problem.
In fact, a recent study found that financial incentives weren't as important as "internal motivators" when it came to participating in certain employer wellness programs. The National Business Group on Health and Hewitt Associates surveyed 3,000 employees about their participation in employer-sponsored wellness activities, and found that many were ready and willing to participate. As an example, 48% said they would fill out a healthcare questionnaire because "it was the right thing to do," and only about 28% said they would do it because of financial rewards or penalties.
So while paying patients to improve their own health works sometimes, it isn't always necessary. The challenge for payers and employers is to figure out when it is appropriate, and at what levels, so they can achieve change without overpaying. Paying patients $90 to take their warfarin worked just as well as paying them $150, which is important to know if you're looking at rolling out a project over a large patient population.
As one member of Hewitt Associates put it when talking about the wellness study, "[You] don't have to pay people to do everything. It may be better to just pay for the things that are harder to do."
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Executives at nonprofit hospitals in New Hampshire are defending their compensation packages after the state Attorney General announced a plan to review hospital CEO salaries in the state.
Attorney General Michael Delaney called attention to executive compensation last month as he announced that his office would reject the planned acquisition of Catholic Medical Center in Manchester by Dartmouth-Hitchcock Health. His report noted that Catholic Medical Center President-CEO Alyson Pitman-Giles received a significantly larger compensation package than her peers and promised a follow-up investigation of hospital CEO compensation across the state.
"The reasonableness of the compensation paid to Ms. Pitman-Giles is an area of significant concern to the Attorney General," Delaney said in his report.
Although Pitman-Giles pulled in a total of $1.36 million in 2009, most CEOs of nonprofit hospitals in New Hampshire have compensation packages in the mid-six figures. The New Hampshire Hospital Association says the state's nonprofit hospitals aren't worried about the investigation and are eager to comply.
"The New Hampshire Attorney General certainly can do an investigation and we welcome his review. There is nothing to hide. The hospitals are willing to comply with any kind of request," says Kathy Bizarro, executive vice president of the New Hampshire Hospital Association.
Because of their tax-exempt status, nonprofit hospitals are no strangers to criticism about executive compensation. Senator Chuck Grassley criticized compensation levels fiercely last year after an IRS report found that compensation at nonprofit hospitals averaged nearly $500,000 a year. Although Grassley's focus on CEO compensation faded as the healthcare reform debate intensified, the Patient Protection and Affordable Care Act did include new requirements for tax-exempt hospitals related to community benefit and providing care without considering financial eligibility.
Compensation numbers from 2009 take on particular significance because of the faltering economy and the financial struggles of some hospitals. Some executives lost money as their hospitals struggled. The CEO of Exeter Hospital, for instance, saw his earnings drop roughly $40,000 last year as the hospital lost $944,800 during the period, according to the New Hampshire Union Leader.
The NH Attorney General's Office has said that it will not directly ask CEOs to take a pay cut if it finds that compensation is excessive, but will instead contact the boards of directors and inform them about the high pay levels.
For now, hospitals are just waiting to hear back about the investigation, says Bizarro.
Patients who are uninsured or on Medicaid are more likely to die in the hospital when being treated for heart attack, stroke, or pneumonia, a new study finds.
Researchers examined 154,381 discharges with one of those three diagnoses, and compared in-hospital mortality, length of stay, and cost-per-hospitalization for Medicaid and uninsured patients with the privately insured. The data revealed that, compared to privately-insured patients, uninsured patients had 52% higher odds of dying in the hospital after a heart attack and 47% higher odds of dying in the hospital after a stroke. Among pneumonia patients, the odds of mortality were 21% higher for those on Medicaid.
Length of stay was also significantly longer for Medicaid and uninsured patients for all three conditions.
The higher mortality and LOS rates may be stem in part from uninsured patients' lack of access to primary care and preventive services, says lead researcher Omar Hasan, MBBS, MPH, instructor at Harvard Medical School and hospitalist at Brigham & Women's Hospital in Boston. Uninsured patients are likely to have more severe disease, which could account for higher mortality, he says.
But the quality of hospital care may also be a factor. Other studies have shown that hospitals are less likely to utilize invasive and potentially life-saving interventions on the uninsured, says Hasan. For example, an uninsured patient with acute myocardial infarction may be less likely to be treated with coronoary angiography than a privately insured counterpart.
Previous research cited by the authors also suggests uninsured patients may actually have a higher risk of receiving substandard care.
"These disparities are the result of several factors. It's not just one particular thing.," says Hasan. "We can't quantify exactly what factor contributes how much."
What can a hospital do to address the disparity and close the gap between the insured and uninsured? The first step is to start collecting and analyzing better data to recognize the gap in care at the hospital level, says Hasan.
"The fact that we found these differences . . . suggests that not everyone is getting the care they need, that there is disparity based on insurance," he says. "I think we could do a better job by providing evidence based care to everyone who walks in the door."
The deadline for 2011 Medicare Advantage carrier bids this Monday provided another flash point in the ongoing clash between insurers and the government, as cuts to the MA program—as well as the possibility of higher rates for seniors—inch closer to enactment.
The latest tiff comes as lawmakers who voted for major cuts to MA now appear concerned that those cuts could be passed on in the form of higher rates or fewer benefits for seniors.
"Healthcare reform strengthened Medicare and made Medicare Advantage more competitive, but it is critical that we don’t let private insurance companies use these changes as an excuse to raise premiums or cut benefits for seniors to bolster their own bottom line," said a group of Democratic members of Congress in a letter last week to HHS Secretary Kathleen Sebelius.
The letter cited a recent study from the Government Accountability Office that found some lower-cost Medicare Advantage plans had higher levels of cost sharing and unexpected expenses. The legislators asked Sebelius to "hold MA plans accountable for their bid submissions," and essentially prevent insurers from cost-shifting.
Although the $136 billion in cuts over 10 years won't kick in until 2012, the MA 2011 payment rates will be frozen at 2010 levels. Even though medical expenses are expected to continue rising, Sebelius said that "Medicare Advantage plans [should] offer the same level of choices at affordable cost-sharing and premiums next year that they do this year," in a letter to WellPoint Inc., Cigna Corp., BlueCross BlueShield Association, and Health Care Service Corp.
Sebelius also asked the insurers to "focus on price and quality rather than asking seniors who need healthcare the most to pay more for it," as they submitted their bids on Monday.
But the insurance industry countered with a letter and study of its own in an attempt to defend Medicare Advantage plans.
Karen Ignagni, president of America's Health Insurance Plans, sent a letter on Friday to Secretary Sebelius touting the quality benefits of MA plans and warning of potential consequences that may follow cuts to the program.
Ignagni cited a study released this week by AHIP that found MA patients have lower risk-adjusted readmission rates than Medicare fee-for-service enrollees. The report only analyzed data from nine states, but found that readmission rates were 14%-29% lower for MA enrollees.
The letter to Sebelius also hinted at the premium hikes that lawmakers fear if the cuts are enacted. "History has demonstrated that inadequate Medicare Advantage payments result in higher premiums and reduce benefits and choices for seniors," Ignagni wrote.
Although Secretary Sebelius has the authority to deny bids, the prospect of higher premiums in an election year may worry legislators who promised before reform legislation passed that cuts wouldn't affect seniors.
When the American Medical Association recently released a 10-point "Code of Conduct" for health insurers, the public reaction from payers was pretty passive and politically correct.
"We do adhere to the code of conduct principles as outlined by the AMA. In fact, we have been doing so for quite some time," said Ross Blackstone, spokesman for the Health Care Service Corp. Other industry representatives issued similarly tame defenses.
But privately, some people in the health insurance industry have been much less welcoming of the AMA's 10 commandments. "I won't practice medicine if you don't practice actuarial science," one insurance consultant said.
Payers and physicians have a long history of bad blood, and the AMA's somewhat aggressive code didn't do much to improve relations.
A few of the points in the code—relating to rescissions and spending on medical services—were already covered in healthcare reform legislation. Others, such as a request for "respectful relations," seemed like vague potshots. There were, of course, valid criticisms in the code, particularly when it comes to administrative simplification and physician relations. But on the whole, it seemed like one segment of the industry simply airing its grievances with another.
What if, as a person in the insurance industry suggested to me, payers wrote their own code of conduct for physicians? Based on feedback from a few industry representatives, it might look something like this:
1. Engage in fair billing. While the majority of physicians already adhere to this point, the same could be said for insurers and some points in the AMA's code of conduct. There are, however, a few bad apples that over-bill or sometimes commit fraud.
2. Disclose conflicts of interest. "Physicians should be subject to the same transparencies as the insurers. Patients should have a right to know whether or not their physician owns the imaging center where they are sent for their CT scan, should know how much their physician is charging for their cardiac cath, etc.," says Peter Gurk, MD, medical director for Bluegrass Family Health.
3. Learn the business side of medicine. Insurers often have the best relationships with physicians who understand the business aspects of managed care and are willing to partner with their payers.
4. Embrace the evidence. The AMA requested that medical necessity be defined as care a prudent physician would provide in accordance with "generally accepted standards of medical practice." But that doesn't necessarily mean evidence-based care and could include practices that are commonly practiced but not necessarily the best option.
If a group of health plans released a code of conduct for physicians, would that accomplish anything? Probably not. And it's unlikely that the AMA's code of conduct will, either. Again, the physician organization had some valid criticisms, but the delivery of the message only makes public the wedge between the two groups.
Blame doesn't lie solely with the AMA. Both groups have to overcome a rocky history and learn to work better as partners. Gurk, who has worked both as a physician and for a health insurer, offers the best advice: "Drop the adversarial relationship on both sides."
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Deaths from medication errors appear to increase in July, perhaps because of the addition of new and inexperienced residents in that month, according to a new study.
Dubbed the "July effect," the phenomenon has been observed anecdotally, but David P. Phillips, PhD, of the University of California San Diego and Gwendolyn E.C. Barker, BA, of the University of California Los Angeles, looked at more than 62 million death certificates from 1979 to 2006 to find a pattern.
They observed that in counties with teaching hospitals, fatal medication errors rose 10% in July, and the greater the concentration of teaching hospitals in a county, the higher the spike in deaths. However, the death rate returned to normal after July, suggesting that residents learn quickly after the initial month.
But for teaching hospitals, even a short one-month spike in deaths from errors is a major quality challenge. Many hospitals have implemented policies in the past five years to better integrate new healthcare professionals and prevent the July effect, says Joanne M. Conroy, MD, chief health care officer at the Association of American Medical Colleges.
Successful strategies include the following:
Start with orientation. The quality team—including risk managers and quality and safety officers—should be involved in the orientation process for new residents, says Conroy.
Build a culture of safety. The orientation process is an early opportunity to begin ingraining new residents with the culture of the hospital. "Start them on the right foot by reviewing the quality goals of the organization and how important these are for good patient care," says Conroy. "Make sure they know who to call if there is a question and that they understand the ‘culture of safety’ at your institution."
Teach teamwork. New residents should always wear their name badges and introduce themselves to other members of the care team, especially nonphysician members, before they start. Teamwork is key to hospital safety, and effective communication early on facilitates the team-building process. "Emphasize that it takes teams of providers to care for the complicated medical conditions we see in teaching hospitals. They are an important contributor, but they are not in it alone, and there is no shame in asking for help," says Conroy.
Emphasize infection control. Simple infection control techniques like regular hand washing have proven challenging for even seasoned providers, so it's important to start emphasizing these procedures early in the residency.
Train with technology. The orientation process should include a thorough training on how to use the electronic health record and e-ordering systems.
In addition to increasing education and training related to medication safety, the researchers also recommended re-evaluating responsibilities assigned to new residents and providing more supervision when they start.
An association of physician-owned hospitals filed a lawsuit against the federal government yesterday in a long-shot attempt to overturn restrictions included in the recent healthcare reform bill that limit the growth and new construction of the controversial facilities.
The suit was filed jointly by Physician Hospitals of America and Texas Spine & Joint Hospital, a 20-bed private hospital in Tyler, TX, and alleges that the new law violates due process and equal protection rights granted under the U.S. Constitution.
At issue is Section 6001 of the Patient Protection and Affordable Health Care Act, which limits the development of new physician-owned hospitals or the expansion of existing ones. Although standing hospitals were grandfathered in, the law prevents them from expanding unless they meet a series of new requirements.
There are more than 300 physician-owned hospitals across the country, and 39 were under development but cannot continue because of the new law, according to PHA.
After the legislation passed, Texas Spine & Joint Hospital halted a planned expansion that had been in the works for years, says Michael E. Russell, II, MD, an orthopedic spine surgeon at the facility. The hospital had purchased nearby property and spent several million dollars preparing for the 20-bed expansion, which had already won local zoning approval.
Although the hospital will be able to remain open in the near future, hospital leaders are now unsure about its long term prospects because of the restrictions, says Russell. "How do we continue to evolve? How do we continue to take care of the patients that come in? We are going to have a huge increase in patients because of reform, and we need more access to care not less. Why would the government seek to keep a wonderful high quality, efficient, way to perform hospital services from expanding and growing?"
Accompanying the lawsuit was an injunction that would allow Texas Spine & Joint Hospital to proceed with its planned expansion.
The battle over physician ownership of hospitals has been ongoing, and similar provisions that would have restricted their development were included in previous legislation but stripped before passage. Congress also previously placed moratoriums on the construction of physician-owned hospitals.
The effort to ban physician ownership has often been spearheaded by other hospital organizations, including the American Hospital Association. While the AHA has raised questions about financial conflicts of interests and the safety of physician-owned hospitals, PHA claims that the restrictions are about eliminating competition.
“[Physician-owned hospitals] undermine the ability of full-service hospitals to continue to provide essential services as the community’s healthcare safety net," says AHA spokesperson Elizabeth Lietz.
After losing the lobbying battle, the courts may be physician-owned hospitals' last chance. The plaintiffs will try to convince the court that the law "treats physicians different than any other class of citizen," says Molly Sandvig, executive director of PHA. "Anyone else can own a hospital except a doctor. It's outrageous and not based on what this country's founded on."
But that legal argument is unlikely to work, according to Neil Caesar, president of the Health Law Center in Greenville, SC: "At first glance, it seems like they face an uphill battle. Physicians are not a protected class for constitutional purposes. They would have to show that there was no legitimate justification for the carve-out."
It was just a few years ago that health savings accounts and high-deductible health plans were hailed as the future of healthcare and considered the tools for fixing the system through consumer-driven reforms. And it was just a few months ago that HSAs were on the brink of extinction as the target of an amendment in proposed healthcare reform legislation.
So now that HSAs have survived a brush with death but are no longer the priority they once were, what does the future hold for the accounts and similar health reimbursement arrangements?
Some think they are doomed to a death by a thousand cuts. Although provisions that would have completely gutted HSAs were ultimately dropped before healthcare reform passed, there were a few changes to how HSAs operate in the final bill. Consumers can no longer use them to purchase over-the-counter drugs, and the tax penalty for spending the funds on nonqualified expenses was raised.
But given all the changes that were made in this law, "having two minor changes like that made to HSAs was pretty small," said Martin Trussell, senior VP of business development at First Horizon Msaver, in a recent HealthLeaders Media audio feature.
It's the potential regulatory changes, rather than the explicit ones, that could have the most impact on the accounts. Each year the Secretary of Health and Human Services will have authority to determine the minimum required benefits for all health plans, which "opens the door to death by regulation," according to John C. Goodman, president of the National Center for Policy Analysis.
All HHS has to do is establish minimums that effectively exclude HSA-funded high-deductible plans from the government-approved health insurance options, and they're done for. But at this point, there really has been no indication that this administration wants to eliminate them altogether, and predictions about how HHS will set the bar for health plans are just speculation.
The fate of HSAs could actually swing in the other direction. Health savings accounts could become more popular now that reform has passed.
The number of lives covered by HSAs increased 25% last year to 10 million, and the plans have seen the steady addition of about 2 million consumers every year, according to a recent AHIP survey. The growth has come primarily from the group markets, as rising healthcare costs have made high-deductible plans much more attractive to employers struggling to pay for healthcare. If healthcare costs continue to climb unabated, there's really no reason for this trend to change.
The new mandate for health insurance coverage might even open up a new customer base for HSAs. The portion of the population that is uninsured because they can't afford coverage will like turn to Medicaid and other forms of federal assistance to meet the new requirement. But the young, relatively healthy segment of the population that is uninsured by choice—often because they consider themselves too healthy to need it—will now have to pick a plan or pay a penalty.
Some may opt to pay the fine, and others may just go ahead and buy a traditional plan. But with lower premiums and incentives that reward consumers who utilize few healthcare services, high-deductible plans coupled with HSAs seems like a natural fit for this group.
Although consumer-directed health plans will no longer be a central pillar in the plan to fix healthcare, as they were under the Bush administration, they aren't likely to go away anytime soon. Other than that, it's just too early to tell how HSAs will fare under the new healthcare system.
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