The Department of Health and Human Services on Wednesday announced the award of $181 million in new grants to help states establish health insurance exchanges. HHS also issued two guidance documents to help states build exchanges.
Illinois, Nevada, Oregon, South Dakota, and Tennessee received Level One exchange establishment grants, which provide one year of funding to states that have begun the process of building their exchange.
Washington became only the second state to be awarded a Level Two establishment grant, which offers funding over multiple years to states that are further along in building their HIX. Rhode Island was the first state to receive a Level Two grant.
At the press conference announcing the grants and guidance materials, HHS Secretary Kathleen Sebelius noted that the grants enable states to "go at their own pace" as they set up exchanges.
All totaled, HHS has awarded an estimated $1.2 billion in exchange grants since 2010:
Planning grants to 49 states and the District of Columbia totaling more than $54 million,
Early innovator grants to seven states totaling more than $249 million, and
Establishment grants to 34 states and the District of Columbia totaling more than $856 million
States may apply for exchange grants through 2014 and may use the funds through 2015. However, exchanges are expected to be up and running on Jan. 1, 2014.
HIX remains a political hot potato for some states. Only 11 states have enacted legislation to establish an exchange. Kansas, Louisiana, and Kansas officially returned their funding and their grants were closed out.
Last week, New Jersey Governor Chris Christie vetoed legislation that would have established a state exchange. "Because it is not known whether the Affordable Care Act will remain, in whole or in part, it would be imprudent for New Jersey to create an exchange at this moment in time before critical threshold issues are decided with finality by the court," the Republican governor explained.
The guidance documents released provide information about what HIX will look like in 2014 and how to navigate the process. States can run their own HIX or elect to partner with HHS. The Exchange Blueprint includes a detailed explanation of the activities that HIX will perform and the information that states will need to submit to get their exchange or partnership approved to operate in 2014.
A second document outlines how the federally facilitated exchanges or partnerships will operate and how HHS and states will partner in an exchange. In a partnership exchange states can elect to handle plan management and in-person consumer assistance or leave those activities to HHS.
Plan management includes ensuring that health insurance companies are certified, have an adequate provider network, and offer the required essential benefits package. Consumer assistance includes enrollment activities.
Exchange applications should be submitted by mid-November 2012. HHS will review and approve or conditionally approve the applications by Jan. 1, 2013.
What could be called a Medicare brain trust made an appearance last week on Capitol Hill in the first in a series of roundtable discussions on Medicare physician payments and hosted by the Senate Committee on Finance.
In attendance were Gail R. Wilensky,PhD; Bruce C. Vladeck, PhD; Thomas Scully; and Mark McClellan, MD and PhD. Each has headed the Centers for Medicare & Medicaid Services or its predecessor, the Health Care Financing Administration.
In his opening statement Sen. Max Baucus (D-MT), who chairs the committee, said the idea was to "focus on where things stand now and how we got here." He was referring, of course, to that scourge of politicians and providers: the sustainable growth rate formula.
Panic Mode Congress and physicians are in a bit of panic right now because of the 27% cuts to physician payments that is slated to take effect in January 2013. In the old, pre-debt reduction days, Congress simply looked the other way as it voted to ignore the SGR for 10 years.
Now though it's becoming increasingly difficult for Congress to kick the SGR can down the road. Plus this is an election year, which puts Congress on the hotseat. It must resolve the longstanding issue without appearing to stick it to physician voters.
That brings us to the Medicare brain trust.
Proposed SGR Fixes
There was general acceptance among the group that the SGR had never worked quite the way it was expected to. Among the shortcomings and suggested fixes:
SGR objectives are inconsistent with the incentives it produces. In her statement, Wilensky noted that individual physicians and groups are "implicitly encouraged to increase spending, because nothing they can do as individuals will affect overall spending, but their fees will be affected by what other physicians do collectively, irrespective of their own behavior."
Suggested fix. Set the SGR at the level of a physician's practice. Wilensky says that would link physician updates to physician behavior. She sees it working for larger group practices but it would be a problem for individual and small group practices because of the adjustments that would be needed for to correct for atypical patients.
SGR is fundamentally irrational. Vladeck said he was shocked that in 2011 the difference between the targets the SGR produces and the actual Medicare outlays since SGR was enacted was less than $13 billion, or about 1.2% of the total outlays. "There is something fundamentally irrational about a formula that requires a reduction of 27% from physicians to recoup a difference of just over 1%. A similar logic applied to an ordinary commercial obligation would violate every anti-usury law I've ever seen."
Suggested fix. Vladeck said Congress needs to acknowledge the SGR mistake, repeal it, and replace it with an update factor similar to what is applied to other Medicare providers such as hospitals, ambulatory surgical centers or home health agencies.
The AMA is embedded in the Medicare payment process. Thomas Scully saidthe AMA's Resource Value Update Committee (RUC) did a good job for their members by taking over the process, but the RUC became too powerful, very political and "very responsive to stronger specialty groups" and limits the ability of the SGR to work.
Suggested fix. Scully suggested removing the RUC from the AMA and letting it operate as an independent body "through a contractor reporting to the CMS directly." He says it appears the current CMS team is asserting itself more to "make the RUC truly advisory. CMS and objectivity should be driving valuations, not physician politics."
The relative value unit system is really a relative estimated average cost system. McClellan said the RVU system assigns the same value to a service regardless of whether it's of lifesaving value to a patient or no value at all, that it's tough to keep the system up to date with medical technology, and that new services such a e-mail consultations, and nurse- or pharmacist-led care management teams may not be covered at all.
Suggested fix. McClellan, who is a physician himself, said the first step is leadership from the physician community. "Who knows better the best opportunities to improve care and avoid unnecessary costs for Medicare patients that are not well supported by Medicare's currents payment systems?" The second step is to translate clinical opportunities for improving care into Medicare payments reforms that better support patient-centered care. He said that means identifying current payment rules in the fee-for-service system that don't do as much as they could to promote efficient high-quality care.
At the end of the roundtable Sen. Baucus asked the group to create specific short-term and long-term SGR fixes. He gave them 30 days to accomplish the task but cautioned that he wasn't committing to introduce any of their ideas as legislation. I won't be counting the days, but I did make a note on my calendar to check back with the committee.
I don't doubt the Medicare brain trusts' ability to develop some good ideas, but I do doubt Congress's ability to substantially deal with the issue. The SGR problem will be an unwelcome gift to the new Congress that assumes office in January 2013.
'After all,' I can imagine our representatives declare sanctimoniously, 'it would be unfair for a lame duck Congress to deny newly minted representatives a say in this very important matter.'
This article appears in the May 2012 issue of HealthLeaders magazine.
Aetna Inc. is developing commercial ACO and ACO-like relationships with several providers. The company has 10 agreements in place and expects to have a total of 20 under contract by the end of 2012, says Charles D. Kennedy, MD, CEO of aligned care solutions for Aetna.
The ACOs are each centered on a healthcare delivery system, hospital, or integrated delivery network. The program is in its infancy—it's been in the works for about four years but just began contracting in 2011. The diversified healthcare benefits company wants to develop a national ACO network over the next five years.
Aetna is investing in excess of $1 billion in a variety of capabilities to support its ACO business, including last year's acquisition of Medicity, a health information exchange technology company.
Kennedy is straightforward when asked why Aetna is developing this business line. "What we get out of this arrangement is growth. Health plans are in a low-margin, high-volume business. What they get is a business partner that can help them improve their margins, improve their market share, and improve the quality of care that they provide."
He adds that Aetna wants to shift the traditional payer-provider relationship from rate-based to value-added-based. "The traditional payer-provider rate fights led to relationships without synergy because they were just based on contract discounts." Aetna's ACO program is based on aligning incentives such as shared savings so all parties are looking for opportunities to add value to the relationship and provide better patient care.
Aetna has profiled delivery systems across the country to identify which are likely to be successful in forming and operating an ACO. Aetna looks at a host of metrics, including typical considerations such as the size of the system or medical group and its patient volume, clinical utilization and outcomes, and patient mix. It also looks at the mix and size of the employer community and assesses the interest level of the insurance agent and broker community in an ACO product.
Culture and leadership also play a role in the assessment. "The ACO concept requires change. Some organizations are ready to embrace change and others are not," says Kennedy. He notes that filling hospital beds was once a sign of success and increased revenue. "In this new model, filling your beds may be a bad thing. It could mean you aren't doing a good job managing readmissions or coordinating care."
Existing Aetna contracts include Carilion Clinic (Roanoke, Va.), Banner Health Network (Phoenix), Sharp Community Medical Group (San Diego), Heartland Health (St. Joseph, Mo.), Emory Healthcare (Atlanta), and Cleveland Clinic (Cleveland). The relationships range from a collaboration that involves only Medicare patients, to cobranded health plans and new payment models with shared savings for meeting quality and clinical targets. Some of the arrangements have elements of ACO agreements but are not full ACO models at this time. In some cases, Kennedy and his team are helping put the processes in place to move toward ACOs.
Aetna is taking several approaches to structuring these ACO relationships:
Support for clinical integration. If it isn't in place already, Aetna helps establish a clinically integrated model and helps implement a workflow process and management structure to clinically integrate. Among the expected outcomes: improved work load across the care team and real-time access to claims and utilization data.
Defined population management. This is case management for Medicare Advantage, Medicaid, or commercial members. Kennedy says this can be a beginning step for a healthcare delivery system that doesn't want to leap into an ACO but is interested in financial incentives that are consistent with care coordination and quality programs. Among the expected outcomes: lower utilization of healthcare resources and reduced hospital readmissions.
Private label health plans. Here, Aetna handles the back-office functions of claims processing, customer service, call center, and care management. Hospitals or physicians can use this to strengthen brand awareness. "It's their product, their brand, and their revenue," explains Kennedy. "They have complete end-to-end transparency as to when they improve efficiencies within their hospital or practice, and how that converts to a price point improvement versus their competition." Among the expected outcomes: a more diversified revenue mix and improved management of population outcomes.
The length of the typical ACO contract will vary depending on how much progress the delivery system has made in clinical integration and accepting risk. "For a delivery system with no clinical integration in place, we might look at a contract that runs five years or more because it's going to take a while to get everything lined up, make the governance changes, and deploy the technology."
Aetna is not looking to develop exclusive relationships with the providers. Kennedy explains that providers can't be expected to make a big investment in the technology and other systems and then only use them on a subset of their patients. "For many of our products and services, we offer them on an all-patient/all-payer basis because that's the only way to get the work flow to make sense. A provider isn't going to design one work-flow system for Aetna patients, another for Blues patients, and then another for their Medicare patients."
He says it's too early to see results from these relationships but that the response to the business model has been positive. "One surprise for us is that some national account customers with employees in Roanoke are carving out their healthcare insurance business in the area so they can send their employees specifically to Carilion."
This article appears in the May 2012 issue of HealthLeaders magazine.
The national annual cost of medical care for a typical family of four with PPO coverage has edged up over $20,000 for the first time, according to the actuarial and consulting firm, Milliman.
The 2012 Milliman Medical Index estimates the annual cost at $20,728. That's a record $1,335 increase in the total cost of care compared with 2011, and the first time the cost has notched above the $20K mark since Milliman started reporting on these costs twelve years ago.
Through a combination of copayments, deductions, and premiums, the prototypical family of four will be responsible for a record share—42%—of its medical costs.
A combination of factors is driving the increase, including the comparative lack of control insurers exert on outpatients costs, a slowdown in hospital bed utilization, and the cost of technology in patient care, explains Chris Girod, principal and consulting actuary in Milliman's San Diego office and a co-author of the report.
The good news? The pace of the increase is slowing. The 6.9% increase in total costs is the lowest annual rate of increase in more than a decade.
The MMI is comprised of five components: inpatient facility care, outpatient facility care, physician services, pharmacy, and miscellaneous other. View slideshow.
Among the MMI findings:
Outpatient facility costs posted its first single digit increase, 8.6%, in four years, but for the fifth year that increase outpaced all the other MMI components.
Outpatient facility care costs totaled $3,699, or 18% of a family of four's annual healthcare bill. Girod explains that the level of insurer control is improving under contractual discount arrangements, but still isn't on par with inpatient controls.
Inpatient facility utilization or the number of inpatient days for a covered population in a year has remained unchanged for several years. However, the patients who are hospitalized tend to require more intensive and expensive services that have helped boost the cost of treatment contributing to a 7.6% increase in the average charge per day costs.
Physician care costs reversed a four-year trend and increased by 5%. Girod says a number of things may have contributed to this cost bump, including evidence of some pushback by physicians in their contract negotiations with health plans.
Hospital inpatient costs ($6,531) and physician costs ($6,647) each account for 32% of a family of four's total annual healthcare bill.
Pharmacy costs continued their roller coaster ride of cost increases and exceeded $3,000 for the first time. The 7.3% increase is down slightly from 2011's 8%, but a significant increase over 2010's 6%. Pharmacy costs totaled $3,056 or 15% of the family's total annual healthcare bill. Girod says that while the shift to generics has helped slowed the growth in pharmacy costs, the expense of specialty drugs will have a growing impact on this cost trend.
The cost of miscellaneous other services such as durable medical equipment, ambulance services and home health posted a 6.7% increase to $795.
In addition to looking at costs on a nationwide basis, for the last five years the Index has looked at comparative healthcare costs in the same 14 cities across the country, including Chicago, Denver, and Los Angeles.
With a current annual cost of $24,965, Miami has topped the list for five years. Girod explains that Miami has a large number of healthcare practitioners and capacity helps drive the demand for healthcare services. Also, the practice of defensive medicine is more prevalent in the Miami area.
Phoenix was the least expensive with a cost of $18,365 for a family of four.
For the 2012 study, healthcare costs in 11 of the 14 cities exceeded $20,000 annually for a typical family of four. In 2011 only six of the 14 cities posted costs in excess of $20,000. While that could suggest an easing in the geographic differences in the cost of healthcare, Girod says a more likely explanation is that "the entire scale is shifting up, both at the bottom and the top, so we just ended up with more cities over that $20,000 threshold."
The report notes that so far the Patient Protection and Affordable Care Act has had "only a limited effect on total healthcare costs for the illustrative family of four."
Florida's major health insurer has joined forces with two South Florida healthcare providers to create a specialty accountable care organization that will focus on oncology services.
Florida Blue, Baptist Health South Florida, and Advanced Medical Specialties (AMS), a Miami-based oncology group, are partners in the collaboration.
There are an estimated 160 ACOs or ACO-like organizations at some stage of development across the country, according to a November 2011 study by Leavitt Partners, a Salt Lake City, UT–based health intelligence business. Commercial ACOs are typically focused on population health issues such as reducing hospital readmissions and reducing emergency room use.
But dedicating an ACO is a specific specialty such as oncology is relatively new, and the Florida organization is believed to be among the first in the country.
Florida Blue and AMS, which has 46 physicians in 17 locations throughout the Miami-Dade County area, have worked together on other quality protocols. The physicians admit to Baptist Health, which is part of the Florida Blue network, so the three decided to look at working together on an ACO.
The collaboration is the first specialty ACO for the large insurer, which also hopes to develop a cardiology ACO and expand its specialty ACO model statewide to promote integration of healthcare. Oncology was selected for the kick-off because is "a major specialty cost driver in the state," explains Jon Gavras, MD, chief medical officer and senior vice president-delivery system for Florida Blue.
ACOs are attractive to oncologists, who are seeing their revenue streams disrupted as payers, especially Medicare, reduce reimbursements for cancer drugs. The coordinated care approach provides an opportunity to reduce the cost of cancer care by sharing in efficiencies in the treatment process.
The Florida Blue ACO model will focus on patients who need interventional services or modalities of treatment, which tend to be intensive, expensive and involve substantial hospital costs.
Gavras says a disease such as diabetes will not be pulled into the ACO model because in the early stages of the disease treatment it is physician-, not hospital-based. He says good primary care that is managing the risk factors around diabetes, including closely monitoring blood sugars, leads to better outcomes. Gavras explains that the disease is already being aggressively managed through Florida Blue's patient-centered medical homes.
The oncology ACO with Baptist Health and AMS began on May 1 and Gavras says there is no distinct time period for the collaboration. "We're looking for an evolution of the program to enlarge in size and expand to other specialties."
In the beginning, an estimated 500 to 1,000 of Blue Florida's commercial members are expected to be part of the ACO. There are plans to expand the program to its Medicare Advantage members in South Florida.
The ACO will look at clinical outcomes tied to readmission rates, adherence to chemotherapy regimens, and adherence to accepted clinical guidelines as well as the efficiency of care delivered to the patient.
Gavras declined to discuss the financial arrangements for the ACO but said the upfront costs include analytics. "This is a data intensive process. The amount of data and information that has to be pulled together and gone through is enormous. This is not easy stuff." Florida Blue will provide much of the data analysis. AMS will maintain the electronic medical records.
The CEO of troubled Saint Catherine Medical Center in Ashland, PA has been named as a co-defendant in a suit filed by the facility's Chapter 7 trustee. Filed in the US Bankruptcy Court for the Middle District of Pennsylvania, the suit alleges a "breach of fiduciary duty of care."
Filed on May 8, the suit, which stems from a management agreement between the medical center and Specialty Health LLC, the hospital's management company, names Specialty Health as the other defendant.
According to court documents, Saint Catherine's CEO, Merlyn Knapp, authorized a transfer of $300,000 from Saint Catherine Medical Center to Saint Catherine Hospital of Indiana LLC (dba Saint Catherine's Regional Hospital) to cover operating expenses. The Indiana hospital and the Pennsylvania medical center are part of Saint Catherine Health.
The date of the transfer is not included in the lawsuit, but the court documents note that as of the bankruptcy petition date (April 9) "a substantial portion of that amount is still due and owing" to the Pennsylvania facility.
Earlier this year, federal and state officials uncovered serious deficiencies and violations that put patient health and safety in immediate jeopardy at Saint Catherine Medical Center. The Pennsylvania Department of Health imposed a ban on new admissions. On April 3, federal officials sent a letter to Knapp threatening to terminate the facility's Medicare agreement.
Saint Catherine Hospital of Pennsylvania LLC (dba Saint Catherine Medical Center) filed for Chapter 11 bankruptcy on April 9, but changed to Chapter 7 on April 18 claiming it had $45,000 on hand and debt in excess of $5.8 million.
Knapp, who is identified as an employee of Specialty Health, served as president, CEO, and CFO of the Pennsylvania facility, and the lawsuit claims that he "knew or reasonably should have known" that Saint Catherine Medical Center was "insolvent or on the verge of insolvency."
The lawsuit alleges "abuse of the powers" delegated to Specialty Health under its management contract. Specialty Health "used it powers and authority under the management agreement for the improper purpose of diverting" account receivables away from the medical center.
In addition to the $300,000, the lawsuit also cites $1.7 million in "take backs" used by Capital Blue Cross to offset the amounts owed the Indiana and Pennsylvania hospitals, as well as Specialty Health, for employee health benefits against what the insurer owed Saint Catherine Medical Center for services rendered.
Although the "take backs" were "made for the benefit of the Indiana hospital and Specialty Health" neither have made any reimbursements to the medical center, the suit charges.
Other allegations include:
Shipping as much as 900 pounds of supplies from the Pennsylvania medical center to the Indiana hospital just days before the medical center's bankruptcy petition was filed. The shipment was paid for with the credit card of Robert Lane, a Specialty consultant. The medical center was not reimbursed for the supplies.
Milton Knapp received approval from Saint Catherine Medical Center's board to open an alternate bank account that "would provide an alternate means to handle fiscal matters." The signors on the account were alleged to be Knapp and Katie Schroyer, the medical center controller, rather than the medical center itself "to prevent the accounts from being attached or garnished" by creditors.
The lawsuit asks for several claims of relief suggesting that Knapp "acted with a purpose other than advancing" the medical center's best interests. "In fact, Knapp's actions were for the benefit of" the Indiana hospital and "operated to the detriment" of the Pennsylvania medical center, the suit alleges.
Specialty Health "fraudulently expanded" the medical center's indebtedness by continuing the medical center's operations and "continuing to incur debt" despite knowledge that the facility was "financially incapable of continued operations," the suit claims.
Efforts to reach Milton Knapp, who also serves as CEO of Saint Catherine Regional Hospital in Charlestown, IN, were unsuccessful Thursday.
When you're looking for healthcare cost drivers, don't overlook those high-prestige, must-have hospitals that payers need in their networks to keep their customers satisfied. Their rates are hobbling health insurers, or so it appears.
But get this: Sometimes health plans don't play hardball when it comes to provider negotiations. They'll agree to large increases in provider payments as long as their competitors pay even higher rates.
Must-haves, by the way, are often academic medical centers like Partners Healthcare in Boston. While they used to be referral centers for more specialized care, these must-haves are offering more primary and secondary care, as well as tertiary and quaternary care.
Robert A. Berenson has looked into this phenomena and produced a study that appears in the May issue of Health Affairs. Berenson is a fellow at the Urban Institute and serves as vice chair of the Medicare Payment Advisory Commission or MedPac. Along with Paul Ginsberg, president of the Center for Studying Health System Change, Berenson and his team conducted interviews with healthcare leaders in the 12 metropolitan communities involved the center's community tracking study.
Geography, specialized services and the size of the hospital system across multiple markets can also play a role being deemed a must-have. Berenson says that's the case in Miami where Baptist Health, which is not an academic medical center, effectively competes with the University of Miami Hospital and is considered a must-have for insurers.
Here are five instructive points gleaned from the study:
1.The haves sometimes help the have nots.
Berenson says there's evidence that some hospitals without must-have market power can get reasonably decent rates when health insurers are trying to maintain hospital competition in the market. In markets such as Indianapolis there is an effort, according to one healthcare leader, to "keep small providers alive, so there is less consolidation." Mid-tier hospitals can definitely get spillover rates from the must haves but that usually doesn't extend to hospitals that cater to low-income Medicaid and uninsured patients. Insurers don't think twice about leaving those hospitals out of their networks unless they house a level one trauma center.
2.Dominant insurers don't sweat rates.
Dominant insurers with 60% to 70% of a market don't need to muscle the must-haves to accept lower rates. "As long as they think they have the most favorable rates, they don't have to push their potential market power. They just have to be better than the competition," says Berenson. He explains that while the rates in these markets are lower than in markets where there isn't a dominant insurer, the rates themselves aren't bargain basement.
3.Tiered networks are a tough sell.
The must-haves are in a position to veto most efforts to make them part of a tiered network where there is higher patient cost sharing for selecting that hospital. Even if a must-have facility agrees to be part of a tiered network, it has the clout to define the terms of the tier to make sure cost sharing probably won't have much of an affect.
4.Bluffing doesn't work.
If an insurer doesn't have a reasonable threat of excluding a hospital from a network, then it loses a lot of negotiating leverage. In that case, Berenson says the only hospitals an insurer can legitimately threaten are facilities that don't see a lot of the insurer's members.
5.Employers often look the other way in insurer-hospital confrontations.
Berenson says Boston is a perfect example of this phenomenon. Employers may complain about their healthcare costs, but when Tufts Health Plan tried to take on the powerful Partners, employers balked at the possibility of not having the healthcare system in their networks. "You don't do business in Boston if you're a health plan without Partners. So what's the threat against Partners? It's a must have for employers."
In the end, Berenson says negotiating leverage between insurers and hospitals is a more nuanced process than previously considered. It makes you wonder if public policy focused on health plan rates increases is really getting to the root of the problem. Berenson and his team conclude that "a range of other market and regulatory approaches also need to be examined."
More than 270 interested parties filed public comments regarding the Meaningful Use Stage 2 proposed rules, but it is a few paragraphs in the 68-page comment letter from the American Hospital Association (AHA) that has drawn the attention and ire of patient and consumer advocate groups.
Citing HIPAA concerns, the AHA disagrees with the Centers for Medicare & Medicaid Services proposal "to provide patients with the ability to view, download, and transmit large volumes of protected health information via the Internet."
It also terms as "too aggressive" the proposal that electronic information about a hospital admission be available within 36 hours of discharge for at least 50% of the patients. In addition, the AHA questions the authority of CMS to require that 10 percent of all discharged patients view, download or transmit to a third party their information during the reporting period for meaningful use.
Public reaction to the AHA's comments was blunt:
Deven McGraw, a lawyer and director of the Health Privacy Project at the Center for Democracy and Technology, said in this blog post that "getting patients critical information about their hospital stay could have an impact on their ability to recover. Patients should expect hospitals to be their partners in healthcare—but in no partnership that I'm aware of does one side get to hoard all of the relevant information."
Daniel Z. Sands, MD, president of the Society for Participatory Medicine, which represents both clinicians and patients, made this press statement: "Patient engagement is the cornerstone of a successful, cost effective, and high-quality health care system. Those goals cannot be achieved unless we give patients access to their own health information and encourage them to use it."
Columnist e-Patient Dave at e-patients.net suggested that the AHA had declared war on patient empowerment.
Among the common themes: hospital MU performance shouldn't be dependent upon actions not fully under hospital control, measures that require adherence from a party other than the physician should be eliminated, and all electronic health record (EHRs) should be certified to all core quality measures (CQM).
Here are some of the comments: The College of Healthcare Information Management Executives (CHIME), which represents 1,400 healthcare CIOs:CHIME wants to require certification of EHR products to all CQMs needed to meet meaningful use in each setting. "Through our experiences with Stage 1, we found that although EHR products were able to automatically produce CQM reports, the data was inaccurate and largely incomparable across different providers."
In its 46-page comment letter CHIME requests that the time to make online access of hospital information available to the patient be extended from 36 hours to four business days. It also objects to the requirement that 10% of discharged patients be able to view or download their information online. This echoes a common sentiment from commenters stating that providers' performance on MU objectives shouldn't be dependent on what their patients do or choose not to do.
CHIME also asks CMS to follow the precedent set with Stage 1 to allow providers to demonstrate meaningful use of EHRs during a continuous 90-day reporting period. It would also
Premier Health Alliance, which represents more than 2,600 hospital members:
Premier supports the CMS decision to extend Stage 1 MU, but wants CMS to publish a final rule specifying Stage 2 requirements by August 2012 warning that failure to do so will "seriously compromise the ability of the healthcare community to meet Stage 2 requirements beginning in 2014." If the August deadline can't be met, Premier recommends that Stage 1 be continued for an additional year, and that Stage 2 begin in 2015.
Premier likes the proposal that hospitals report clinical quality measures from a menu of options but asks that the CQM be reduced to 15 instead of the proposed 24. "Our alliance members have encountered significant difficulties in complying with the 15-measure requirement in Stage 1, in some cases due to problems with the performance of certified EHR technology, and we believe it would be more prudent to retain a 15-measure reporting requirement for Stage 2 rather than overreach."
It would like to see timeline for online access be two business days rather than 36 hours after discharge. "A measure based on full days would be simpler than one based on hours post-discharge, since discharges can occur throughout the day, making for a potential compliance nightmare."
American Medical Association (AMA) and 98 state and specialty medical societies:
The AMA sides with the AHA in terms of meeting a requirement for online access to patient health information. The 10% requirement "unfairly predicates the physician's success for meeting the measure on patient compliance and should be eliminated."
For Stage 2, CMS proposes that 50% of all unique patients seen by the physician be provided online access to their health information within four business days after the information is available to the physician. The AMA would like the threshold requirement to be 20% not 50%. AMA contends that the four-day timeframe is "inconsistent with the HIPAA."
It notes that for Stage 2, CMS proposes that the reporting period be the entire calendar year. "The sheer volume of patient information that has to be made available within four business days for the entire calendar year would be extraordinary for most practices and their staff to manage."
The AMA opposes back-dating of the MU penalty program, or for that matter, any other quality or health IT penalty program, including e-prescribing and PQRS. "If Congress intended that these penalty programs be back-dated, the legislation would have stated so. CMS is essentially pushing up deadlines for participation by a full year or more due largely to its own data processing limitations." The AMA asks CMS to allow physicians to successfully meet Stage 2 MU measures for 90 consecutive days during the first six months of 2015 to avoid the 2015 penalty. It says the process should be extended to 2016 and 2017.
Physicians, University of Utah:
"Epic, Cerner, and all major vendors make it absolutely impossible for physicians to bring in outside tools to measure Patient-Reported Outcomes (PROs). This is a real problem… if we are ever going to be able to measure value. Meaningful use must require open access to all EHRs from the vendors. We need to be able to integrate outside tools such as the NIH PROMIS system in the flow of patient care using EHRs."
Cincinnati Children' Hospital Medical Center:
"While a number of pediatric measures were added this year, most of the new measures are only related to very specific specialties. Based on the measures presented, a large number of our providers would still have zero denominators when reporting for Stage 2. We are requesting additional pediatric measures be added as well as the exclusion for patients 18 years and older."
Pacific Orthotics & Prosthetics (California):
"This new look-back period would certainly be the last straw. I am a small business owner competing with corporations that have far more resources. If I have to worry for 10 years that someone may request money back, I will certainly close my shop. … Stop burdening a much-needed industry and look somewhere else for money. The orthotics and prosthetics industry should not be lumped in with the durable medical equipment industry.
Larry Preston, Professional Medical Consultants, Las Vegas
"Providing office visit summaries in 24 hours will actually harm the patient in the some cases, since we will not have time to include lab and other diagnostic tests that were ordered on that visit. The current requirement of 72 hours at least allows for those tests to be documented in the physician's notes prior to sending to the patient."
Healthways is broadening its business model as it prepares for the loss of its Cigna contract, which over the course of the 14-year relationship grew to represent about 20% of Healthways' annual revenue.
The giant wellness program and disease management provider just announced a 10-year strategic agreement with Texas Health Resources (THR) to implement physician directed population health management.
Details of the agreement, including specific measures of success, are still being worked out, according to Jon Scholl, chief strategy officer for Arlington, TX-based THR, but will generally include claims analysis for its physician practices, risk modeling, and health coaching.
The non-profit THR system includes 24 acute care and short stay hospitals in the Dallas-Ft. Worth area. It employs 550 physicians and contracts with another 5,000. It generated $3.7 billion in totaling operating revenue in fiscal year 2011, but Scholl says that despite its substantial size, THR considered the idea of developing its own population health program to be a daunting task.
"There are a lot of things that are needed to manage the health of populations, including information systems that intake and analyze claims and risk modeling. Those are things that Healthways brings to us in this partnership that Texas Health Resources would otherwise have to invest behind."
Mike Farris, Chief Executive Officer of Navvis Healthways, says working with health systems will enable the company to maintain engagement with patients over a longer period than it can by working with health plans, whose membership can shift from year to year.
He explains that a successful economic model to improve the well being of a population requires sustained engagement with that population over several years.
Farris notes that while members may come and go from a health plan, they tend to maintain relationships with the same doctor and hospital facilities. "We can achieve a greater longitudinal effect on the well being of that patient if we're not subject to that (health plan) churn."
The move to the provider side makes sense for Healthways says Brooks O'Neil, a Minneapolis-based analyst with Dougherty & Company. He says that with healthcare reform and the growth in accountable care organizations, providers recognize the need to take a more holistic approach to patient care management and represent a significant growth market for Franklin, TN-based Healthways.
O'Neil notes that in recent years, Healthways has faced increased competition on the wellness front from large health plans such as Aetna and UnitedHealthcare, which have developed their own internal population health programs or acquired established players in the market.
Cigna announced in October 2011 intentions to run its own wellness programs. Its Healthways contract is winding down and will expire in February 2013. O'Neil says continued interest by health plans demonstrates that population health is a robust concept.
He says Healthways is targeting more regional health plans, which are less likely to have the resources to develop their own programs. A move to attract employer groups, who see population health as a way to save money on healthcare costs, gained Healthways contracts to manage wellness programs for 122,000 state employees and dependents in Ohio and 47,000 city employees and dependents in Chicago. Both contracts run for three years and include data collection, biometric screenings and behavior coaching.
Health systems are expected to play a major role in the Healthways revenue model. Farris says Healthways has identified several potential markets and is looking at large health systems that "share our view" about population health management. O'Neil says Healthways has 20 similar deals in the pipeline.
Although THR and Healthways declined to put a dollar value on their relationship, it's clear that THR has the potential to be to be one Healthways' top clients. O'Neil notes that Cigna accounted for about $110 million in annual revenue. He estimates that over the next few years THR has the potential to contribute as much as $30 million in annual revenues.
The acquisition by Healthways of Ascentia Health Care in Philadelphia and Navvis & Co. in St. Louis underscores its interest in the provider market. Navvis is a consulting firm that works with health systems, hospitals and physician groups. Ascentia provides software to assist physicians in managing the population health of their patients.
O'Neil doesn't view the deals as big revenue acquisitions. Instead they bring historic experience and relationships in dealing with provider organizations. "They may even bring business models that are oriented to working effectively with provider organizations," he adds.
To prepare for the Healthways agreement THR is working with its employed physicians as well as independent physicians in the area to help them learn how to use and embrace the tools for population health management that the partnership with Healthways will bring. Scholl says that at a tactical level physicians will have access to analytic detail about their entire panel of patients.
As an example, he says a typical primary care physician has no idea how many diabetics are in a patient panel. "That's not the fault of the physician. The information systems haven't been built to answer that question. They've been built to answer questions about the condition of specific patients. They aren't population management systems." He notes that the Ascentia population health software doesn't require electronic medical records. It can be brought to a physician's office through an Internet connection.
The agreement will cover the entire continuum of care from pre-acute to inpatient to post acute care.
THR will quickly rollout some programs such as hospital readmission management. In terms of population management it's meeting with health plans to get a handle on their attributable lives in the THR physician group to develop an ACO-like gain sharing arrangement with the individual health plans, such as Aetna and UnitedHealthcare, so they'll look to THR to manage their members.
Scholl says one advantage of THR and physicians being in the driver's seat for population management is that the program can be uniform across multiple health plans. As it stands now six different insurers can assign six different care coordinators to a physician's office. "If the health system and physicians can work together, which is our aspiration, we'll make those investments across the population."
How the success of the THR-Healthways relationship will be defined remains a question mark for now. Scholl and Farris say the two are defining the metrics now. The program will include a well being assessment developed by Healthways, HEDIS scores will be used, and the two may develop their own outcome measures for both cost and quality.
There has been quite a bit of surveying centered on how hospitals and physician groups are preparing for healthcare reform.
Last week I spoke with Eric Paternoster, the CEO of Infosys Public Services, a Washington, DC-based business consulting and technology company that just released survey findings based on responses from 100 executives from 20 health plans.
In addition to how they are progressing in the implementation of healthcare reform, the executive responses provide insight into health plan priorities and the steps they plan to take to achieve those priorities.
Health plan executives have kicked healthcare care reform into gear. More than 80% say they are already implementing some type of reform measures or plan to implement them this year. The remainder say they are in the planning stages. No one responded that they haven't yet taken any steps toward healthcare reform.
However, readiness levels for key provisions of the Affordable Care Act—accountable care organizations and health insurance exchanges (HIX)—vary considerably. Some 39% of health plan executives said they implemented ACOs in 2011 or will implement them this year. Only 12% said they were taking similar steps for HIX.
Paternoster says the HIX number surprised him because early in the healthcare reform process health plans seemed more interested in HIX than ACOs. He says payer organizations devoted planning and development resources to product design and data exchange to be used as part of HIX.
Of course, politics may have played a role in the softening in interest. The exchanges have been stuck in a quagmire as some states refused all federal overtures, including big bucks, to help establish state-run HIX.
Paternoster says he sees signs that interest in HIX is rebounding as payers look to form their own commercial exchanges. Even if the Supreme Court throws out the ACA legislation, he says payers still see huge potential in the individual market and view HIX as a viable way to bring insurance to the uninsured.
Meanwhile, payer interest in ACOs seems to be cruising along, as insurers such as Aetna developcommercial ACO and ACO-like relationships to shift traditional payer-provider relationship from rate-based to value-added-based. The company expects to have at least 20 ACOs under contract by the end of 2012.
With all the talk about the vaunted triple aim of healthcare: better care, better health, and lower cost, it shouldn't come as a huge surprise that health plans tapped improving the customer experience as their top priority for 2012.
Paternoster says that reflects a shift in the health insurance market from a wholesale (employer-sponsored) to retail (individual) approach to selling insurance. It also reflects how choice will play a critical role in payer and product selection.
The survey indicates that member portals and e-commerce are among the big ideas where payers plan to invest to improve the consumer experience. Embracing multi-channel commerce, mobility, and social media are also on payers' agendas.
Payers have been working on these elements for several years but now are focused on wrapping up that work. Paternoster says, "They know these items are key. Payers know they need to get their technology on board so they can shift from historical to real-time analytics. They need to be able to quickly change how they engage individual members. They also need to be able to monitor what is happening in their provider networks so they can react in real-time to changes there."
Rounding out the list of top health plan priorities is provider collaboration, integrated care management, and health exchanges.
Paternoster notes that the priorities are all related in some way to improving the customer experience. "I think payers recognize that if their providers work together and there's integrated care management then their members will be happier."