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Healthcare Fraud – the $272 billion swindle

Health-care fraud

The $272 billion swindle

Why thieves love America’s health-care system

INVESTIGATORS in New York were looking for health-care fraud hot-spots. Agents suggested Oceana, a cluster of luxury condos in Brighton Beach. The 865-unit complex had a garage full of Porsches and Aston Martins—and 500 residents claiming Medicaid, which is meant for the poor and disabled. Though many claims had been filed legitimately, some looked iffy. Last August six residents were charged. Within weeks another 150 had stopped claiming assistance, says Robert Byrnes, one of the investigators.

Health care is a tempting target for thieves. Medicaid doles out $415 billion a year; Medicare (a federal scheme for the elderly), nearly $600 billion. Total health spending in America is a massive $2.7 trillion, or 17% of GDP. No one knows for sure how much of that is embezzled, but in 2012 Donald Berwick, a former head of the Centres for Medicare and Medicaid Services (CMS), and Andrew Hackbarth of the RAND Corporation, estimated that fraud (and the extra rules and inspections required to fight it) added as much as $98 billion, or roughly 10%, to annual Medicare and Medicaid spending—and up to $272 billion across the entire health system.

Federal prosecutors had over 2,000 health-fraud probes open at the end of 2013. A Medicare “strike force”, which was formed in 2007, boasts of seven nationwide “takedowns”. In the latest, on May 13th, 90 people, including 16 doctors, were rounded up in six cities—more than half of them in Miami, the capital city of medical fraud. One doctor is alleged to have fraudulently charged for $24m of kit, including 1,000 power wheelchairs.

Punishments have grown tougher: last year the owner of a mental-health clinic got 30 years for false billing. Efforts to claw back stolen cash are highly cost-effective: in 2011-13 the government’s main fraud-control programme, run jointly by the Department of Health and Human Services (HHS) and the Department of Justice, recovered $8 for every $1 it spent.

As fraud-fighting has intensified, dodgy billing has tumbled in areas that were most prone to abuse, such as durable medical kit and home visits (see chart). Home-health fraud—such as charging for non-existent visits to give insulin injections—got so bad that the CMS, which runs the programmes, called a moratorium on enrolling new providers in several large cities last year. Since tighter screening was introduced under Obamacare, the CMS has stripped 17,000 providers of their licence to bill Medicare. Thousands of suppliers also quit after being required to seek accreditation and to post surety bonds of $50,000.

Yet the sheer volume of transactions makes it easier for miscreants to hide: every day, for instance, Medicare’s contractors process 4.5m claims. In this context the $4.3 billion recovered by fraud-busters in 2013, though a record, looks paltry.

Better than cocaine

Fraud migrates. Take one popular scam: overbilling for HIV infusion, an outdated therapy that Medicare still covers despite the existence of cheaper, better alternatives. This scam waned in Florida after a crackdown, only to pop up in Detroit, run by relatives of the original perpetrators.

Fraud mutates, too. As old hustles are rumbled, fraudsters invent new ones. “We’ve taken out much of the low-hanging fruit,” says Gary Cantrell, an investigator at HHS—an example being the thousands of bogus equipment suppliers registered to empty shopfronts. Scams now need to be more sophisticated to succeed, he argues. Doctors, pharmacies, and patients act in league. Scammers over-bill for real services rather than charging for non-existent ones. That makes them harder to spot.

Some criminals are switching from cocaine trafficking to prescription-drug fraud because the risk-adjusted rewards are higher: the money is still good, the work safer and the penalties lighter. Medicare gumshoes in Florida regularly find stockpiles of weapons when making arrests. The gangs are often bound by ethnic ties: Russians in New York, Cubans in Miami, Nigerians in Houston and so on.

Stealing patients’ identities is lucrative. Medical records are worth more to crooks than credit-card numbers. They contain more information, and can be used to obtain prescriptions for controlled drugs. Usually, it takes victims longer to notice that their details have been pinched. The Government Accountability Office has recommended that the CMS remove Social Security numbers from Medicare cards to prevent fraud. It has yet to do so.

In one fast-growing area of fraud, involving pharmacies and prescription drugs, federal investigators have seen caseloads quadruple over the past five years. Elderly patients may receive kickbacks to sell their details to a pharmacist. He will then provide them with drugs they need while billing Medicare for costlier ones.

Paid recruiters scour nursing homes for accomplices. Some pharmacies also pay wholesalers to produce phoney invoices. Others bribe medical workers for leftover pills: in April a pharmacy-owner in Louisiana admitted to paying nursing-home staff a few hundred dollars a time to bring her unused drugs, which she repackaged and sold as new, billing Medicare $2.2m for the recycled meds between 2008 and 2013.

Another scam is to turn a doctor’s clinic into a prescription-writing factory for painkillers (or “pill mill”) and resell them on the street. A clinic in New York was recently charged with fraudulently producing prescriptions for more than 5m oxycodone tablets, which were sold locally for $30-$90 each. The alleged conspirators included doctors and traffickers who ran crews of “patients” so large that long queues sometimes formed outside the clinic. The doctors charged $300 per large prescription. One raked in $12m. To cover their backs they would ask for scans or urine samples purporting to show injuries. The fake patients typically obtained these from the traffickers at the clinic door.

False billing by pharmacies is rife. New York’s Medicaid sleuths have stepped up spot checks to see if the drugs in the back room square with invoices. But this is a lot of work, so most outlets are never checked.

Dozens of operators of ambulances and ambulettes (vans designed to take wheelchairs) have been caught offering kickbacks to patients to pretend they can’t walk. This lets them qualify for “emergency” pick-ups, for which the company can charge $400 per patient. New York has clamped down with roadside checks. But in one case, word that a checkpoint had been set up spread so quickly—as drivers called each other and a local Russian-language radio station put out a warning—that the number of ambulettes on the main street “went from several to none in a few minutes as they re-routed down side streets”, says Chris Bedell, who took part.

This sort of pavement-pounding investigative work remains important. Another approach is the “desk audit”, where possible overpayment is identified but the only way to ascertain losses is to sift through heaps of records manually. Florida’s Agency for Health Care Administration (AHCA) has recovered up to $50m a year solely from hospitals billing for treatment of illegal aliens that is wrongly coded as “emergency care”. But the work is labour-intensive. Data-crunching technologies are increasingly being used to complement the human eye. “When I started in 1996 we had little access to data,” says HHS’s Mr Cantrell. “It had to be requested ad hoc from CMS contractors.” Now a central database houses near-real-time information for Medicare. This helps the 300 workers at the inspector-general’s office who are trained in data analytics to “triage” the tips that flow in. “We receive far more than we can investigate closely,” says Mr Cantrell.

The CMS is still getting to grips with a new predictive-analysis system, which was introduced in 2011 to catch Medicare fraud earlier and is modelled on tools used by credit-card firms. This identified $115m of dodgy payments in 2012, its first full year. (The number for the second year has yet to be released.) Another useful tool is voice-recognition technology. In Florida, health workers who conduct home visits have to call in from the patient’s phone during each appointment to have their voice pattern matched against the one stored electronically. This has greatly reduced billing for non-visits.

Technology is no panacea, however. Medicare’s computers were pumping out thousands of payments a year for patients who had been struck off the programme before receiving their treatment, until human hands began to intervene this year. The electronification of patient records can allow “cloning”, in which treatments automatically trigger excessive billing codes by defaulting to set templates.

This is the medical world’s “dirty secret”, says John Holcomb of the Texas Medical Association. Everyone talks about it in the doctor’s lounge, but few complain. (What doctors do complain about is the complexity of the bill-coding system: see article.) Moreover, there are gaps in the data picture—some of which could grow. Federal investigators complain that there is no proper national repository for Medicaid information, which is held state-by-state.

A bigger worry is that, as ever more Medicare and Medicaid beneficiaries move to “managed  care” (privately administered) plans, government sleuths will have access to less data. This could lead to lower fraud-related recoveries.

Efforts have been made to improve information-sharing between government and private insurers, including the creation of a public-private forum, the National Health Care Anti-Fraud Association (NHCAA). But some insurers are reluctant to take part, fearing that being too open with their data would invite lawsuits over privacy. Fraudsters bank on public and private payers not working together to connect the dots, said Louis Saccoccio, the head of the NHCAA, at a recent hearing.

The NCHAA is pushing for federal immunity guarantees for insurers that share fraud-related information. On May 20th a bipartisan group of senators introduced a bill to make it easier for insurers to share data with Medicare. It would also require Medicare to check new providers for links to firms that have previously swindled the taxpayer (which you might have thought it was already doing).

Obamacare has had a big impact, says Shantanu Agrawal of the CMS. One thing it requires is that when a state kicks out a dodgy Medicaid provider, it shares that information with Medicare, and vice versa. Previously there were legal impediments to doing this, for some reason.

Resources are tight for investigators. New York has a Medicaid investigations division of 110 souls (including support staff) to scrutinise $55 billion of annual payments and 137,000 providers. Gloria Jarmon, an auditor with the HHS, told a recent hearing that budget cuts will probably force it to cut its oversight of Medicare and Medicaid by 20% in this fiscal year. “Everyone [in Congress] is excited that we bring in eight times more than we cost, but that hasn’t translated into more funding,” laments Mr Cantrell.

This squeeze makes it all the more important to enlist help. More than 5,000 old folk have joined “Medicare patrols”, which hold local meetings to raise awareness of common scams. A crucial part of the anti-fraud effort is the new, simpler Explanation of Benefits (summary statement) that lets recipients see who has billed the programme with their identification numbers. This is “a landmark change”, a CMS executive told Congress last year, adding: “Our best weapon in fighting fraud is our 50m Medicare beneficiaries.”

http://www.economist.com/news/united-states/21603078-why-thieves-love-americas-health-care-system-272-billion-swindle

From the print edition: United States

complex adaptive systems, data saving lives, EF, health market quality, healthcare, policy, politics, rapid learning health systems

Medicity: Entering a new era of population health

Payers are primary drivers toward PHM, and the Centers for Medicare & Medicaid Services is accelerating its timeline for shifting Medicare to a value-based system. By the end of 2016, at least 30 percent of fee-for-service Medicare payments will be tied to value through alternative payment models such as accountable care organizations or bundled payment arrangements. By the end of 2018, that will increase to 50 percent.

http://www.healthcareitnews.com/news/entering-new-era-population-health?single-page=true

Entering a new era of population health

We have reached an inflection point in the history of health IT

February 18, 2015

In the six years since it became law, the HITECH Act has done much to advance the use of health information technology. And although the process of collecting and sharing health data has not yet significantly impacted care costs or quality, it has laid an important foundation for us to move toward population health management.

[See also: Population health success depends on good data]

There are important discussions underway to determine what’s needed to leverage health data to improve clinicaloutcomes and lower costs, and to extend those benefits across entire patient populations. Intelligent tools for population health will enable improvements in care quality, clinical outcomes and care cost.

Working through issues around health data exchange and patient engagement indicate the next challenges. We must construct a platform that will enable innovation in population health and analytics to thrive.

[See also: Pop health analytics top ACO priority]

Federal entities responsible for overseeing health and the healthcare industry in general are advancing rapidly toward a vision of interoperability and data sharing.

Congress taking a look

Congress is taking both near- and long-term actions regarding health IT innovation and standards. Near-term examples include recently directing the Office of the National Coordinator to report progress around interoperability and data sharing, and asking the Government Accountability Office to report on health information exchanges.

Congress has also launched the “21st Century Cures” initiative to help laws keep pace with health innovation. Among other measures, this initiative would consolidate meaningful use, quality reporting and value-based payments into one program – potentially the most significant move related to population health by Congress to date.

Federal Health IT Strategic Plan and Interoperability Roadmap

This past December, the Department of Health and Human Services released the Federal Health IT Strategic Plan, a coordinated effort among more than 35 federal departments and agencies to advance the collection, sharing and use of electronic health information – the cornerstones of population health management.

The HHS plan’s data-sharing section references the ONC’s Connecting Health and Care for the Nation: A Shared Nationwide Interoperability Roadmap Version 1.0, which was released at the end of January. The roadmap advances the ambitious goals to be reached by the end of 2017, including:

  • Establishing a coordinated governance framework and process for nationwide health IT interoperability;
  • Improving technical standards and implementation guidance for sharing and using a common clinical data set;
  • Enhancing incentives for sharing electronic health information according to common technical standards; and
  • Clarifying privacy and security requirements that enable interoperability.

In announcing the roadmap, HHS Secretary Sylvia Burwell called for “an interoperable health IT system where information can be collected, shared and used to improve health, facilitate research and inform clinical outcomes. This Roadmap explains what we can do over the next three years to get there.”

ONC Annual Meeting

At the February 2015 ONC Annual Meeting, titled “Interoperable Health IT for a Healthy Nation,” National Coordinator Karen DeSalvo, MD, told attendees that the agency’s focus is moving beyond meaningful use, toward interoperability and outcomes. This includes building out the IT infrastructure that will support health reform and enable better population health management.

A highlight of the ONC Annual Meeting was having all of the former national coordinators talk about the national state of health IT in the past, present and future.

David Brailer, MD, the nation’s first national coordinator, said the industry won’t be able to accomplish appropriate risk management, population health management or payment reform without interoperability. The ONC leaders shared a strong consensus that the intelligent use of technology will prevail in realizing population health goals.

Meaningful use is not dead

Despite the notion that it may be time to move beyond meaningful use, the program continues to drive electronic health record adoption, organizations have built incentive payments into their IT budgets and we continue to see program improvements.

At the time of this writing, proposed rules for Stage 3 meaningful user and 2015 Edition Standards and Certification Criteria were at the Office of Management and Budget for final review. The OMB announced of the proposed rules that “Stage 3 will focus on improving health care outcomes and further advance interoperability.”

Additional recent policy adjustments instituted or proposed include:

  • Simplifying satisfaction of the requirement for summary of care transmissions;
  • More realistic measures around the availability and actual viewing of patient information to satisfy patient engagement requirements; and
  • A potential new requirement to send electronic notification of significant patient health care events to patient care teams.

Measures such as these point to the importance of data sharing and enable achievable and meaningful progress toward population health management.

Payment models increasingly emphasize population health

Payers are primary drivers toward PHM, and the Centers for Medicare & Medicaid Services is accelerating its timeline for shifting Medicare to a value-based system. By the end of 2016, at least 30 percent of fee-for-service Medicare payments will be tied to value through alternative payment models such as accountable care organizations or bundled payment arrangements. By the end of 2018, that will increase to 50 percent.

As recently as 2011, Medicare made almost no payments through alternative payment models.

Among private payers, a group of major providers and insurers have formed the Health Care Transformation Task Force to shift 75 percent of operations to contracts designed to improve quality and lower costs by 2020. These very important public and private payer initiatives strongly underscore the need for critical health IT enablers of effective PHM.

Welcome to the new PHM era of health IT

We have reached an inflection point in the history of health IT, as we move beyond the HITECH era into this new era. We have come a long way in capturing health data, yet have only begun to share that data among providers, patients and payers. The opportunity ahead of us is to take major strides toward using that data to improve care and lower costs for the populace in general. We have been through an incredible decade of health IT. There is no sign of it slowing down.

Topics: Accountable Care, Analytics, Financial/Revenue Cycle Management, Population Health, Quality and Safety,Health Information Technology for Economic and Clinical Health (HITECH) Act, Clinical, Patient Engagement,Interoperability, Meaningful use, Department of Health & Human Services (HHS), The Office of the National Coordinator for Health Information Technology (ONC), Karen DeSalvo, Brailer, David, Electronic Health Record (EHR)
complex adaptive systems, cool, data saving lives, EF, health market quality, healthcare, healthy habits, nutrition, policy, politics, quantified self, rapid learning health systems, technology

Peter Hinssen: The Tiger and The Rock

EDxBrussels – Peter Hinssen – The TIGER & the ROCK

Why Extrapolating WON’T WORK & What it means for HEALTH http://www.tedxbrussels.eu About TEDx, x = independently organized event In the spirit of ideas worth…

http://wn.com/tedxbrussels_-_peter_hinssen_-_the_tiger_&_the_rock

8:20 – The Contiguous United States – macdonald’s proximity to people in the US

9:10 The Flip: Pharma moving to Health as a Service (no longer a product)

Institutions > Communities (trust)

Reactive > Proactive (attitude)

Hinssen_HealthMatrix

http://www.datapointed.net/visualizations/maps/distance-to-nearest-mcdonalds-sept-2010/

 

distance_to_mcdonalds_2010_l

complex adaptive systems, EF, facts & data points, healthcare, healthy habits, policy, rapid learning health systems

Living to 150…

Most of the recent change in life expectancy has been that sick men are having their life with sickness prolonged.

https://www.mja.com.au/insight/2015/6/will-cairns-living-150

Will Cairns: Living to 150

Will Cairns
Monday, 23 February, 2015

HUMAN life expectancy will increase to 150 years within this century. Really?

When I was a GP I used to visit my frail elderly nursing home patients in my lunch break. Frequently I found them fast asleep in front of Days of Our Lives. This gave me pause for thought about how we live out our final years.

In the past few weeks it has been interesting to see a number of commentators suggesting that before the end of this century the advance of technology will enable some people to live on to the age of 150.

Among the evidence cited for this is the observation that the average life expectancy has increased from about 40 years to 80 years in the past 150 or so years and that this trend will continue.

The facts tell us otherwise. This Kaplan–Meier graph drawn up from several different life tables shows the proportion of the population who have remained alive over the 100+ years from their birth.

Over the past 200 years or so the application of scientific discovery — public health measures, improved nutrition and, lately, disease treatment — have almost stopped us from dying as children and prolonged our lives as mature adults.

However, our numbers plummet as we approach 100 years of age because all of these interventions make no difference to the reality that we eventually wear out and die. Apart from the odd unverified outlier, only one person has ever been confirmed as living for more than 120 years.

Life tables for the US dating back to the 19th century show the limits of modern technology to deal with the failings of old age:

US white males 1850 2005
Life expectancy at birth 38.3 77.4
Life expectancy at age 50 71.6 80.7

So, in the past 150 years, in the most powerful nation in the world with the best that modern technology and affluence can throw at the challenge, while the average life expectancy at birth has risen by 39.1 years, the life expectancy of a 50-year-old has increased by only 9.1 years.

It used to be that the highest mortality was among children; now it is among the elderly. A man aged 65 years living in the UK in 2004‒2006 could expect to survive for another 16.9 years, of which 10.1 years (59.8%) were deemed to be healthy.

Life expectancy of 65-year-old males in UK
2004-2006 2007-2009
Total 16.9 years 17.6 years
Disability free 10.1 years 10.2 years

While the life expectancy of a 65-year-old man increased by 0.7 years between 2004‒2006 and 2007‒2009, the healthy life expectancy has increased by 0.1 years. Most of the recent change in life expectancy has been that sick men are having their life with sickness prolonged.

There have always been at least a few people who avoided fatal infections, childbirth, accidents, wars, worn-down teeth, cancer, heart disease, or even just wearing out earlier, and have lived to be more than 100 before they slow down and die.

More of us become centenarians now because we don’t die of other things earlier, but there has been no significant increase in the maximum time that people can remain alive.

For most of us our maximum life expectancy remains less than 100 years, and for some far less. There is no evidence that modern technology has been able to stop even people who get no particular disease from just grinding to a halt when their time is up.

We have not been able to put more sand into our hourglass to increase the number of the days of our lives.

Talk of living to 150 is a distraction. The real challenge for the community as a whole is to accept the inevitability of death and to reintegrate that acceptance into culture.

As health workers and health care managers, we can all play a vital role in that process, both in how we communicate our understanding of death as a normal part of life and in how we incorporate it into the care of our individual patients.
Associate Professor Will Cairns is Director of Palliative Care in Townsville and author of the eBookDeath rules — how death shapes life on earth, and what it means for us.

* Australia 2008-2010 – Males
USA 2006
England/Wales 1838-1854 – Males
South Australia 1891-1900 – Males
Sweden 1816-1840
Modelled !Krung
Australia 1946-1948

complex adaptive systems, data saving lives, EF, entrepreneurship, facts & data points, health market quality, healthcare, healthy habits, nutrition, policy, politics, quantified self, rapid learning health systems

Should we pay people to look after their health?

 

http://theconversation.com/should-we-pay-people-to-look-after-their-health-24012

Should we pay people to look after their health?

The key to using incentives may be to do so with a high enough frequency to create healthy habits. Health Gauge/Flickr, CC BY-SA

With the Tony Abbott government expressing concern about the growing health budget and emphasising personal responsibility, perhaps it’s time to consider some creative ways of curbing what Australia spends on ill health. One solution is to pay people to either get well or avoid becoming unwell in the first instance.

The United Kingdom is already doing this kind of thing with a current trial of giving mothers from disadvantaged suburbs A$340 worth of food vouchers for breastfeeding newborn babies. And from January 1 this year, employers in the United Statescan provide increasingly significant rewards to employees for having better health outcomes, as part of the Affordable Care Act.

But should people really be paid to make healthy choices? Shouldn’t they be motivated to improve their health on their own anyway?

Encouraging right decisions

People don’t do what’s in their best interest in the long term for many reasons. When making decisions we tend to take mental short cuts; we allow the desires and distractions of the moment get in the way of pursuing what’s best.

One such “irrationality” is our tendency to focus on the immediate benefits or costs of a situation while undervaluing future consequences. Known as present bias, this is evident every time you hit the snooze button instead of going for a morning jog.

Researchers have found effective incentive programs can offset present bias by providing rewards that make it more attractive to make the healthy choice in the present.

Research conducted in US workplaces, for instance, found people who were given US$750 to quit smoking were three times more successful than those who weren’t given any incentives. Even after the incentive was removed for six months, there was still a quit rate ratio of 2.6 between the incentive and control groups – 9.4% of the incentive group stayed cigarette-free versus only 3.6% of the control group.

A refined approach

Still, while research on using financial incentives to encourage healthy behaviours is promising, it isn’t as straightforward as doling out cash in exchange for good behaviour.

Standard economic theory posits that the higher the reward, the bigger the impact – but this is only one ingredient to success. Behavioural economics shows that when and how you distribute incentives can determine the success of the program.

Here are a few basic principles to consider. First, small rewards can have a big impact on behaviour if they’re provided frequently and soon after the healthy choice is made. We have found this to be true in the context of weight-loss programs, medication adherence, and even to quit the use of drugs such as cocaine.

Games of chance are an effective way of distributing rewards as research has found people tend to focus on the value of the reward rather than their chance of winning the prize. Many people think that a 0.0001 and a 0.0000001 chance of winning a prize are roughly equivalent even though in reality they are vastly different probabilities.

Finally, people are more influenced by the prospect of losses than by gains. Studies show people put much greater weight on losing something than gaining something of a similar value.

In one weight-loss experiment, for instance, participants were asked to place money into a deposit account. If they didn’t achieve their weight goals, the money would be forfeited, but if they were successful, the initial deposit would be doubled and theirs to keep.

Reluctant to lose their deposits, participants in the deposit group lost over three times more weight than the control group, who were simply weighed each month.

Creating good habits

Incentives are particularly effective at changing one-time behaviours, such as encouraging vaccination or attendance at health screenings. But with increasing rates of obesity and other lifestyle-related diseases, we need to focus on how incentives can be used to achieve habit formation and long-term sustained weight loss.

We know financial incentives can increase gym usage and positively impact weight, waist size and pulse rate, but how to sustain gym use after the incentive is removed? The key may be to use incentives to achieve a high frequency of attendance for long enough to create a healthy habit.

We also need to consider how we can leverage social incentives, such as peer support and recognition, together with new technologies to maximise the impact of incentive-based programs.

Innovative solutions, like paying people to encourage the right health choices, may help to reduce both the health and economic impact of Australia’s growing burden of disease.

EF, health market quality, healthcare, policy, politics, rapid learning health systems

50% of US Healthcare Payments to be based on value by 2018

 

http://www.washingtonpost.com/blogs/wonkblog/wp/2015/01/26/the-obama-administration-wants-to-dramatically-change-how-doctors-are-paid/

Wonkblog

The Obama administration wants to dramatically change how doctors are paid

By Jason Millman January 26
The Obama administration is setting aggressive goals for reforming how Medicare reimburses health-care providers. (AP Photo/Jeff Barnard)

The Obama administration on Monday announced an ambitious goal to overhaul the way doctors are paid, tying their fees more closely to the quality of care rather than the quantity.

Rather than pay more money to Medicare doctors simply for every procedure they perform, the government will also evaluate whether patients are healthier, among other measures. The goal is for half of all Medicare payments to be handled this way by 2018.

Monday’s announcement marks the administration’s biggest effort yet to shape how doctors are compensated across the health-care system. As the country’s largest payer of health-care services, Medicare influences medical care generally, meaning the changes being initiated by the administration will likely be felt in doctor’s offices and hospitals across the country.

“As a very large payer in the system, we believe we have a responsibility to lead,” said Health and Human Services Secretary Sylvia Mathews Burwell in a press conference. “For the first time, we’re going to set clear goals and establish a clear timeline for moving from volume to value in the Medicare system.”

There’s widespread agreement among policymakers that the U.S. health-care system needs to move away from rewarding doctors and hospitals for volume and focus more on the value of the care being offered. Doctors typically get paid set fees for every procedure they perform, regardless of whether patients get better.

In addition to improving patient care, the government also hopes to cut wasteful spending. Medicare’s current payment system, known as fee-for-service, cost taxpayers $362 billion last year, between the program’s hospital insurance and medical insurance programs, according to the federal Centers for Medicare and Medicaid Services. Critics say the traditional payment scheme fails to discourage overuse of health-care services, without holding providers accountable for whether patients’ get healthier.

Medicare has been experimenting with payment models for more than a decade, and the 2010 Affordable Care Act tried to tackle the issue by expanding payment models that reward providers for the value of care they provide. The programs include lump sum payments for treating a patient throughout an episode of care, like a knee replacement surgery.

The most high-profile effort has been with accountable care organizations (ACOs), which are groups of providers who share in the savings – or losses – for managing patients on a budget. An estimated 7.8 million seniors enrolled in Medicare are currently being served by ACOs, according to the administration.

Farzad Mostashari, a former Obama administration official whose company has helped launch and run three Medicare ACOs, said some hospitals have been reluctant to adopt these alternative payment models because believe they can make more money by charging for each service. But he said the administration’s announcement sends a clear signal that the health-care system is quickly moving away from a system that allows for so much waste.

CMS said alternative payment structures now represent about 20 percent of Medicare payments, and that will rise to 30 percent by 2016 under the administration’s new goals. This marks the first time that Medicare has set specific targets for expanding the scope of alternative payment systems in the program, CMS said.

Debra Ness, president of the National Partnership for Women and Families, a consumer advocacy organization, said these payment models will force health-care providers to better coordinate care.

“We’re not just talking about payment that lowers costs,” she said. “The payment changes are designed to change the way that we deliver care in ways that will make that care work better for patients and families.”

This shift to value-based payments had already been taking place in the private sector before the ACA. About 20 percent of provider payments by Blue Cross insurers are through contracts that try to prioritize quality over quantity, their trade association reported last summer. Aetna says 28 percent of its reimbursements are now in valued-based contracts, and it expects that rate to jump to 75 percent by 2020.

Many have viewed this broader shift as long overdue, as health care spending has grown to about one-sixth of the U.S. economy. But it’s still uncertain how well these payment approaches work.

“We still know very little about how best to design and implement [value-based payment] programs to achieve stated goals and what constitutes a successful program,” concluded a 2014 Rand Corporation study funded by HHS. The report, which reviewed pay-for-performance models implemented over the past decade, said improvements were “typically modest” and often hard to evaluate.

Some early efforts to implement newer value-based payment programs have shown mixed results.

Two high-profile ACA programs encouraging health-care providers to work as accountable care organizations have resulted in modest savings to the Medicare program so far, about $877 million. But at least 13 of the 32 organizations that participated in the most ambitious of these efforts — the Pioneer ACO program — have dropped out of the program in the past two years. Most of these groups left to join programs with less financial risk.

Farzad Mostashari, a former Obama administration official who now advises three Medicare ACOs, said some hospitals have been reluctant to adopt these alternative payment models because believe they could make more money by charging for each service. But he said the administration’s announcement sends a clear signal that the health-care system is quickly moving away from this wasteful payment scheme.

“It’s not so much about the specific goal, because that can and will change,” Mostashari said. “It’s about the sense of commitment that [hospitals] are perceiving.”

A representative for the American Hospital Association said the trade group supports the administration’s goals. Robert Wah, president of the American Medical Association, said members of the country’s largest doctor’s group were “encouraged” by Medicare’s efforts to reform how care is delivered, as they’ve become increasingly concerned by bureaucratic requirements.

“There is a great deal of regulatory and administrative burden on [doctors] currently,” Wah said. “We’re in a period of great change, and great change causes anxiety.”

Jason Millman covers all things health policy, with a focus on Obamacare implementation. He previously covered health policy for Politico.
EF, health market quality, healthcare, policy, rapid learning health systems

Private Players Launch Value-based Task Force

 

http://www.healthleadersmedia.com/print/HEP-312643/Private-Players-Launch-Valuebased-Task-Force

Private Players Launch Value-based Task Force

John Commins, for HealthLeaders Media , January 29, 2015

Two days after HHS unveiled significant Medicare payment reforms, a group of commercial payers, providers, and industry partners says it is committed to putting 75% of its business into value-based models by 2020.

Some of the nation’s largest healthcare systems and payers on Wednesday launched theHealth Care Transformation Task Force, with an ambitious commitment to put 75% of their business into value-based models by 2020.

Steven Brill

Richard J. Gilfillan, MD
CEO of Trinity Health

The task force describes itself as a “private sector alliance dedicated to accelerating the transformation of the U.S. health care system to value-based business and clinical models aligned with improving outcomes and lowering costs.”   Members include commercial payers, providers, and partners.

The announcement comes just two days after Health and Human Services Secretary Sylvia Burwell announced plans to ramp up Medicare payment reforms featuring alternative payment models and value-based payments.

Richard J. Gilfillan, MD, CEO of Livonia, MI-based Trinity Health, is chairman of the task force, which he said is “committed to rapid, measurable change both for ourselves and our country that will improve quality and make healthcare more accessible for all American families.”

Gilfillan spoke with HealthLeaders Media on Wednesday about the task force and the goals and challenges it will face in the coming months and years. The following is an edited transcript.

HealthLeaders Media: What is your biggest concern about the value-based care rollout and how can your task force prevent it from happening?

Richard Gilfillan: My biggest concern is that as an organization we don’t get there in a timely way because we find ourselves having to respond to the pushes and pulls from all directions as opposed to a clear and smooth path forward.

My concern from the broader perspective of the industry is that this is an incredible time and a great opportunity to get to where we all want to get to. I’d hate for us to miss the opportunity because we can’t find a way to make it happen, and this kind of cooperation in setting goals and working together really gives us an optimal chance to transform our care system.

HLM: Are you concerned that the value-based rollout could become as disorganized as the HIT rollout?

RG: I wouldn’t want to come off as being critical of that specific issue and segment of the industry. From a provider standpoint I am concerned, and I used to be in the payer business as well. I know that we all—whether providers, payers, or employers, or advocates for patients—have our ideas and we think they are the best and only way.

This is hard work for providers and payers making this big transition. If we are pushing and pulling on 10 different paths to how we see it and what we think the timing should be, it’s even harder.

People will find themselves in this hedging scenario, one foot in the canoe and one on the dock. If we could get some commonality around time frame and consistency of approach then it is very doable.

HLM: Are you on the same page as HHS at this point on the value-based rollout?

RG: Secretary Burwell talked about two sets of metrics. One was for gauging the extent to which their payments are operating under these alternative contracts, which they defined as medical homes with triple-aim outcomes, bundled payment programs, ACO programs. That aligns directly with our thinking about our 75% commitment.

They also talked about how many of the dollars would be operating under the value-based payment systems, which is more the incentive-type arrangements that don’t necessarily have total cost of care included.

I understand that they needed to pay attention to that space. We are well-aligned in terms of the goals and the definitions. Hopefully, we’ll find that as the industry comes together to develop the best ways to get at that and define those models in more detail, that is where we will influence each other and come to an approach that works.

We would like to work with HHS and CMS to do the most we can to create a synergistic approach. There is a lot of potential for building momentum in the private sector as well.

HLM: Why do you believe this transition should be “rapid?”

RG: We have found as we have talked to other providers that it’s really hard to operate in two or three different ways. At first everyone said, ‘let me try a little alternative contracting, a little responsibility for total cost of care and better outcomes, but I want to keep my old way of doing things too.’

People realized that the halfway world is very difficult and disorienting for an organization and its people. That period of uncertainty, mixed messages, and confusion, is painful. Many of us have said, ‘let’s find our way to that sooner and be on a specific path so we can communicate in a straightforward way with our organization and people.’

We want to give them a clear message and a path forward and a sense of where we are going so that we can plan that out and execute on it in a logical thoughtful way. Most of us feel that it’s better to do it sooner rather than drag it out into an extended period of uncertainty.

HLM: So the mindset now is that this is going to happen so we might as well get it done?

RG: I think so. The other thing we are realizing is that it’s not just about cost, or quality, or health. It’s about all three. Nobody went into healthcare to deliver fragmented, uncoordinated, inaccessible, and unaffordable care. This is actually taking us back to why we went into healthcare. It’s exciting. Let’s get there sooner rather than later. The country needs this sooner rather than later from a lot of perspectives.

HLM: Did the timing of the HHS announcement on Monday affect your announcement?

RG: Our first meeting was in June and we were reaching out to people two or three months before that. This is almost a year’s work getting to this point. People in Washington have talked about there being a timeline from the federal government since 2009.

We heard from the secretary’s office a week and a half ago that there was going to be some announcement. They were putting a stake in the sand. We were invited to be part of an initial information session and then we were invited to join the secretary at the announcement.

We realized this is very much on a parallel track and one that works. It’s a great coming together of people’s thinking about what it would take to be successful.

HLM: Do you anticipate more disagreements within the task force as you address more specific details on how value-based care will work?

RG: The answer is yes. We do anticipate differences of perspective. The reason we need to do this is because there are multiple perspectives and those perspectives are different among providers and payers and across those groups.

We have already done some hard work in talking through those differences and creating what we think is a preferred set of principles and policies.

Our most immediate effort is going to be to provide comments in the episode-based payment space and in ACOs and we are working on that now. So yes, there will be differences, but that is the purpose of this.

We have to listen to each other and understand each other’s perspectives and this task force creates a context in which we can actually do that. We hope we can provide input for CMS along the way.

HLM: How did you come to decide upon 75% in value-based by 2020?  

RG: We knew that one of the key goals here was to put a stake in the ground that we all had to agree to and 75% and five years seemed reasonable.

HLM: How will the task force spend its time over the next few months?

RG: Organizationally, we just launched publically and we are still putting the logistics in place to operate the task force. It’s been up and operating, but we are trying to understand the best way to engage as many people and organizations as possible, so we are working through the best way to do that, and respond to what we see as a lot of interest.

There are a lot of people who are interested and I hope between this and the HHS announcement people will see it’s a good time to make that commitment organizationally.

HLM: Do you expect the task force to take on new members in the coming years?

RG: This is about folks coming together who hope and expect that others will be interested in signing on and working on this goal. I am already getting a fair number of inquiries from folks saying they’d like to be involved.

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Establishing markets in prevention and wellness – 3 examples

1. AIA Vitality Life Insurance

  • https://www.aiavitality.com.au/vmp-au/
  • Wendy Brown – University of Queensland wbrown@hms.uq.edu.au
  • Tracy Kolbe-Alexander – University of Queensland

2. Data Driven Healthcare Quality Markets

3. Abu Dhabi Health Authority – Weqaya

 

 

Vitality Institute Commission – Recommendation 3 http://thevitalityinstitute.org/commission/create-markets-for-health/

EF, health market quality, healthcare, nutrition, policy

HBR Blog: Preventive Health Care Markets

 

https://hbr.org/2014/11/what-the-u-s-can-learn-from-india-and-brazil-about-preventive-health-care

What the U.S. Can Learn From India and Brazil About Preventive Health Care

NOVEMBER 14, 2014

media companies, automakers, clothing retailers, and other industries have for decades looked abroad to find ideas and innovations they can adapt for the US market. But in one of America’s largest, fastest growing, and sometimes most confounding sectors — healthcare — the situation is different.

Imports like aspirin (Germany) and the heart transplant (South Africa) have become almost as American as apple pie. But in preventive health — keeping people from getting sick, or helping them manage the conditions they do have — we adapt too few of the best foreign innovations and models that have proven to be effective and sustainable at scale.

The U.S. spends far more per capita on healthcare than any other nation. Clearly we need to adopt cost-effective prevention efforts where we can. And we have to do so in a way that fits our health care infrastructure, including reliance on the private sector — a mix of for-profit and non-profit payers and providers — as the bedrock of our system. Two tactics that do fit, and can both lower costs and improve patient care, include more expansive use of mobile technology and of lay health workers. Both can be supported by non-profit intermediaries. Scalable models for these interventions are in use and successful in emerging economies, and are particularly germane where it comes to preventing illness and disease in low-income or geographically or linguistically hard-to-reach patient populations.

India’s Telemedicine

Take telemedicine for example, an approach to getting information to remote populations at a fraction of the cost of circuit-riding physicians. In India, 70% of the population lives in rural areas, but only 3% of the country’s specialist physicians practice in those areas. A nonprofit called World Health Partners (WHP) is working to bridge the gap by identifying informal health providers at the village level and using live streaming over the internet to connect them to highly qualified specialists far away. These lay workers, compensated through consultation fees and a reasonable mark up on drugs sold, measure blood pressure, temperature, heart rate, respiratory rate, and can assess EKGs and transmit the results directly to the specialist physicians.

The University of California at Berkeley has studied the program and reported a dramatic increase in access to reproductive health services among six million villagers at a cost of $5.84 per adult for a couple of years protection from pregnancy. Perhaps the most important lesson for the U.S. in WHP’s telemedicine initiatives in India is its approach to scale. Rather than implementing a program and figuring out later how it might be brought to very large numbers of people, WHP is building scalability into the design through low-cost approaches, and a reliance on for-profit rural practitioners — effectively working with the private sector to build a new market for preventative health.

INSIGHT CENTER

  • Innovating for Value in Health Care
    SPONSORED BY MEDTRONIC

    A collaboration of the editors of Harvard Business Review and the New England Journal of Medicine, exploring best practices for improving patient outcomes while reducing costs.

Brazil’s Integration of Lay Health Workers

More deeply integrating lay workers into our health system offers another path to lowering costs and broadening the reach of preventative health care. Most nations, including the U.S., make some use of lay or community health workers, but Brazil is notable for the scale at which it does this, and its success in integrating such workers into its larger healthcare system. A recent Johns Hopkins study notes that Brazil now deploys over 220,000 Community Health Agents (CHAs) to reach more than half of its 200 million residents. They work as members of health teams, including at least one doctor, one nurse, an assistant nurse and six CHAs to serve approximately 1,000 families. All the team members are salaried, full-time employees, and the CHAs must live in the communities they serve, promoting and delivering preventative health practices such as breastfeeding, prenatal care, immunizations, and screening for diseases including HIV and tuberculosis. In tandem with this approach, Brazil now has one of the most rapidly declining childhood mortality rates in the world, and has made striking gains in immunization coverage and other measures of preventive health addressed by the CHAs.

While the U.S., too, has some promising community health worker models, such as “health coaches” at AtlantiCare in Atlantic City, N.J., and “ promotoras” at Latino Health Access in Santa Ana, CA, Brazil’s experience offers us a path to scale, one that no longer views community health workers as “non-traditional,” but integrates them into the healthcare system, and, ultimately, pays for them in the same way that care in clinical settings is remunerated.

Mindset Before Model

 The “market” for preventive services is almost nothing like the market for automobiles; we can’t rely on market forces alone to increase the flow of global preventive health innovations into the U.S. But we should recall that Japanese automakers had been innovating for a long time before American automakers got serious about exploring and adapting these innovations. The first change may need to be mindset: expanding our view of where we might find powerful models for improving preventive health in the U.S., expanding our idea of who should be involved in identifying, prototyping, and scaling these models, and thinking big — designing for scale — from the outset.

Nidhi Sahni is a Manager in the public health and global development practice with The Bridgespan Group, a nonprofit advisor to other nonprofits and philanthropy.

Michael Myers is Managing Director at The Rockefeller Foundationand leads its global health work.

data saving lives, EF, health market quality

RWJF: Making Sense of the Medicare Physician Payment Data Release: Uses, Limitations, and Potential – The Commonwealth Fund

Making Sense of the Medicare Physician Payment Data Release: Uses, Limitations, and Potential – The Commonwealth Fund.

PDF: 1789_Patel_making_sense_Medicare_phys_payment_data_release_ib

Overview

In April 2014, the Centers for Medicare and Medicaid Services released a data file containing information on Medicare payments made to physicians and other providers. Though an important achievement in promoting greater health system transparency, limitations in the data have hindered key users, including consumers, payers, and providers, from discerning meaningful information from the file. This brief outlines the significance of the data release, the limitations of the dataset, the current uses of the information, and proposals for rendering the file more meaningful for public use.