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Health Reform Hiatus - or Not

By Michael D. Miller MD
June 28th, 2009

I’ve been reading so much about health reform that the inside of my eyelids are burning with headlines about draft committee bills, CBO scoring, Republican responses, editorials for and against various amorphous proposals, and multiple organizations advocating about a public plan option, a public plan option, a public plan option…….

I was hoping that for the July 4th Congressional recess week the public’s and pundits’ attention would go elsewhere, but then I saw this week’s Economist cover picture of President Obama:

Economist Magazine - June 27, 2009 Obama and Health Reform
(If you look closely you can see that the syringe is graduated in Trillions of dollars from $0.25trn to $1.5trn - indicating that paying for health reform is likely to be the main cause for political pain.)

International Perspectives
International perspectives may be useful in assessing healthcare systems and reform options.  Usually people, (and pundits), in the US look to other countries for lessons about how to fix the US’s problems - despite Atul Gawande’s January 2009 New Yorker article that described how other countries’ health care systems have historical roots rather than being based on social contracts or grand political decisions.

Rather than looking outward from the US, the Economist provides the opportunity to see how other countries view the US health care system and out current reform efforts.  [Note: the British have no to observe the July 4th holiday hiatus - after all, for them the date doesn’t mark a holiday of independence, but rather the beginning of the unraveling of their global colonial empire.]

The June 26th issue has 2 one page columns about the politics of health reform, and a 3 page article that looks at the problems and possible solutions.  The article, “Heading for the emergency room,” is particularly interesting since it uses the terminology I adopted several years ago to describe the issues of high cost and limited insurance coverage as symptoms rather than as fundamental problems in the US healthcare system, and to highlight the fundamental problems as actually being  the incentives created by the US’s Fee-for-Service (FFS) reimbursement system.  As the article two sentence introductory summary clearly states: “America’s health care is the costliest in the world, yet quality is patchy and millions are uninsured.  Incentives for both patients and suppliers need urgent treatment.”  Although I’m sure that US physicians, (and other clinicians), and hospitals, (and other healthcare institutions), wouldn’t want to be called “suppliers,” the analysis is spot on.

The article also addresses issues of prevention, health IT, and increasing competition information, transparency and accountability, but eventually returns to the conclusion that incentives need to be realigned - “More competition and transparency would help, but the main goal of any reform plan must be to address the perverse incentives that encourage overconsumption [and overdelivery] and drive up costs.”

This is the same conclusion that’s been reached in Massachusetts.  The state’s Special Commission on the Health Care Payment System is expected to release their recommendations in July about how to take health care reimbursements in the state from being based upon a FFS system to one that pays physicians, hospitals, accountable care organizations, etc. using global payments - a term that has multiple possible meanings which will get more precisely defined during the legislative/regulatory process in the coming months.

Conclusions
Stat tuned.  Following the July 4th hiatus, Congress will be in session for 4 weeks and there will certainly be lots of action.

Congress’ ability to move health legislation towards consensus and closure in July will be very important since when they return in September there will only be 25 legislative days until the October 15th trigger date for using the Reconciliation rules in the Senate. Of course, there is no requirement that Reconciliation be used after October 15th to achieve the President’s goal of health reform this year, but if bipartisan agreement cannot be reached before then, the temptation to go the Reconciliation route requiring only 50 votes to pass legislation will be very hard to resist - despite the fact that it may limit the substance of what can be included in health reform.

At the state level, Massachusetts has been touted as a model for national health reform - having achieved >97% insurance coverage without the use of a public plan. Its actions in the coming months to realign incentives towards quality, value and team-based, patient-centered care rather than volume of services and clinician autonomy, may be even more significant for truly transforming healthcare in the United States - assuming that healthcare in the States are to become united rather than continuing to be segregated across state lines.

Posted in Federal Healthcare Reform, Health System Reform, State-Level Healthcare Reform | No Comments »

Health Reform Heating Up

By Michael D. Miller MD
June 23rd, 2009

With the House and Senate unveiling draft descriptions of their health reform bills, national health reform activities are heating up.  The escalating focus on health reform by Congress and all interested parties was illustrated by the cover and contents of last week’s National Journal.

The cover of the June 13th issue of the National Journal featured Karen Ignagni, head of the American Association of Health Plans (AHIP), the health insurance trade association. The main story inside is about Karen Ignagni, and leaders of other key groups, including Dan Danner (NFIB), Andy Stern (SEIU), and Ron Pollack (Families USA), and how their groups are working much more cooperatively than in the fierce fighting days of the early 1990s. (The interesting point about Karen Ignagni that the article notes, but does not highlight, is that she used to work for the AFL-CIO, and thus does not come out of the Gordon Gekko mold that is sometimes used to characterize the health insurance industry, i.e. profit above all else.)

Aside from the 8 page cover story, the inflammation of health reform on the national stage is evident by the magazine’s coverage of health issues in a poll, an article about a Member of Congress’ approach to her personal health challenges, two columns, two short notices, and 5 full page ads:

  • National Journal Insiders Poll about “how important is it to President Obama that health care reform be bipartisan?” (74% of Democrats said very or somewhat important, as did 70% of Republicans)
  • Article about Representative Debbie Wasserman-Schultz’s approach to her breast cancer diagnosis and treatment
  • Clive Cook’s column “Health Reform’s Twisted Economics” about how the balance of priorities between coverage expansion and cost containment has tipped back and forth during the campaign last year and in the current legislative debate
  • Ron Brownstein’s column “Insurance for Insurance” about how limiting the tax exclusion of health insurance may escalate concerns about the growing financial strain copayments and deductibles are having for people with health insurance
  • Short notices about the bill giving FDA authority to regulate tobacco, and Sen. Conrad’s proposal to morph the public plan concept into co-operative organizations
  • Kaiser Permanente ad about disparities in health insurance coverage
  • Mars ad about their more nutritious products and eliminating advertising aimed at kids under 12
  • McDonald’s ad about their healthier menu options
  • Medco ad about how advanced pharmacy services improve clinical and economic outcomes
  • Siemens ad about information technology for improving healthcare quality

Health Reform Outside of DC, i.e. the Rest of the Country
All of this coverage (and advertising) is consistent with the mainstream discussions about the fulcrum issues of cost containment, mechanisms for increasing coverage, (e.g. mandates on individuals and/or employers), and the public plan option.  But it should also be realized that this is not the context for health reform discussions across the country.

Last night I went to a gathering of about 60 people in Cambridge, MA interested in health reform.  Contrary to the national debate, their focus was almost unanimously how to push for a single-payer health system.  While this discussion is outside of the mainstream of the legislative debate, I’m sure in other parts of the country, (colored red on some people’s maps), similar groups are discussing how to advocate for limiting the government’s role and involvement in the health care system.  These discussions may be supportive of proposals for limiting the tax exclusion of health insurance premiums that are popping up in the middle of the national debates - even though Democrats’ cautious interest in this idea is based upon the many billions of dollars it could raise to pay for coverage expansion rather than any philosophical support for eliminating employment based health insurance, or dramatically expanding the individual purchasing market for health insurance, or limiting the government’s direct role in the health system.

What will happen?
An accurate crystal ball would be great to have right now, but the only thing that seems certain is that more proposals will be put forth by Congress and others, the Administration will continue to engage in the debate trying to get something substantive that achieves as much of their goals as possible, and many more articles will be written and ads placed in publications like National Journal and Roll Call.  When these ads start hitting the media and airwaves outside of DC it will indicate that the debate has reached the next level, i.e. stakeholder groups will then be trying to educate the general public and activate them to engage their Members of Congress and the Administration about specific proposals and pieces of legislative language that today are still in flux and draft form.

Posted in Health System Reform, Politics | No Comments »

Diabetes Updates - New Diagnostics, Increasing Rates, and Implications for Health Reform, CER, etc.

By Michael D. Miller MD
June 17th, 2009

Changes in the diagnosis and treatment of diabetes is a great example for understanding how healthcare delivery constantly evolves based upon new discoveries.  And the history of these changes may help illuminate some thinking about health reform and the development and use of comparative effectiveness research (CER).

First, a little background on diabetes.

Diabetes Background
Diabetes mellitus (or “sugar diabetes”) occurs when the body has problems regulating the level of sugar (specifically glucose) in the blood.  This can be because the body’s pancreas doesn’t produce enough insulin, or for some reason the person’s organs become resistant to the actions of the insulin that is present - or sometimes both occur simultaneously.  Impaired control of glucose means that the levels get too high, which produces problems in the eyes, (leading to blindness), in the kidney, (leading to kidney failure), and in the small blood vessels elsewhere in the body, which can lead to nerve damage and low oxygen delivery to the extremities - particularly the legs and feet, (leading to amputations).

In olden times, diabetes could be diagnosed by sugar in the urine.  (Medical lore says this was done by taste….)  However, until insulin was discovered in 1921 there were no therapies for severe insulin deficiency.  And even once insulin became available, sugar in the urine was still the way diabetes was diagnosed and monitored - usually with a dipstick that changed color depending on the sugar concentration.

It wasn’t until the 1960s that measuring blood glucose levels became possible - and only then in the doctors’ offices because the machines were large and expensive.  In the 1980s machines small and cheap enough for patients to monitor their blood sugar levels at home became available.  This enabled patients to start adjusting their own insulin dosages based upon their blood sugar levels.  (Before this it was too dangerous for patients to significantly alter their insulin dosages because while too little insulin leads to too high sugar levels causing long-term damage, too much insulin can drop sugar levels too low and lead to confusion, coma and death.)

In more recent years it was discovered that keeping diabetics’ sugar levels near normal could prevent essentially all the adverse consequences of diabetes, i.e. blindness, renal failure and amputations. But doing this based upon finger-stick blood sugar levels even 3 and 4 times a day was tricky - and those were just single data points.  So in the mid 1970s it was proposed that monitoring the amount of hemoglobin in the blood that had combined with glucose would give a measure of the average blood sugar level for the 2-3 month life of the red blood cells.  (It was known that glucose irreversibly connects to the hemoglobin in red blood cells in a way that directly correlates to the blood sugar level.)  This test, known as “glycosylated hemoglobin, (or HbA1C, or simply A1C), has been increasingly used over the past few decades to monitor diabetics and adjust their treatments, with the goal to keep A1C levels below 7%, since the level in people without diabetes is 4-6%.

Care Lags Discovery and Development of Innovations
Despite improved ability to monitor diabetes, it is still under diagnosed, and poorly managed.  It is estimated that there are about 6 million people in the US who have diabetes, but don’t know it - which is about 25% of all people with diabetes.  And in 2003-2004, only about 57% of people with diabetes had A1C levels <7%.  (The medical and lost productivity costs for all people with diabetes may be approaching $200 Billion.)

And the prevalence of diabetes is increasing - and with it so are the costs of treating people with diabetes. Last year I wrote about this, and now the CDC has updated information showing the continuing growth in the number of people in the US diagnosed with diabetes:

Increasing Rate Diabetes in the US 1980-2006
Source: http://www.cdc.gov/diabetes/statistics/prev/national/figpersons.htm

The treatment of diabetes has also changed.  After insulin was discovered, different forms and modifications where developed to change how quickly it acted, and beef and pork sources have been replaced with biotech “human” insulins grown in bacterial cultures. Many different types of non-insulin treatments for diabetes have also been developed - these act primarily by increasing insulin production from the pancreas or the action of the insulin in the body.

Which brings us back to the A1C test.  An International Expert Committee from the American Diabetes Association is now recommending that the A1C test be used to diagnose diabetes.  This would replace (or supplement) the traditional fasting blood glucose diagnostic test, and the A1C test would still be used for twice yearly monitoring of the adequacy of treatment for people with diabetes.

These developments in diagnosis and treatment have progressed in tandem - each leveraging off the knowledge gained from the other - with the A1C test being part of the continuing evolution of tests for diagnosing diabetes.  For example, the fasting blood glucose level for diagnosing diabetes has changed over the years.  It was originally set at 140mg/dl in 1979, and then lowered to126 in 1997, when it was also decided that a level between 110-126 should be considered pre-diabetic, or “impaired fasting glucose.” And in 2003 the lower bound for “prediabetes” was lowered to 100.

Why A1C Now?
While A1C testing has been used for years, there have been problems in standardizing the measurement. (This is discussed in the ADA paper linked to above.) But now A1C measurement inconsistencies, (which occur for all lab tests), have been narrowed sufficiently so that the ADA committee is recommending that an A1C level of >6.5% be used to diagnose diabetes, (for patients who are not pregnant and do not have hemoglobin abnormalities - these can change HbA1C levels significantly), and that people with A1C levels >6.0% and <6.5% be considered to have “subdiabetic hyperglycemia” because they have a significant risk of progressing to diabetes.

So Back to Health Reform and CER - The Challenges Ahead
The challenges ahead are to make sure that we continue to utilize future discoveries in a timely and intelligent way. Which finally brings us to health reform and CER. Health reform that expands insurance coverage should dramatically improve the diagnosis and treatment of people with diabetes - which should also help control other healthcare and societal costs because poorly controlled diabetes leads to many other costly problems.  However, immediate cost pressures present barriers to using the best diagnostic and therapeutic interventions.

Comparative effectiveness research is supposed to provide information about the best interventions, but as has been seen with advancements in diabetes, what is best often changes in progressive leaps based upon new discoveries.  And one of the limitations of CER, (and all research for that matter), is that it takes time to do the work and analyze the results.  Therefore, research really provides information about what was the best when the research started - which could have been several years before the results are known and disseminated.  And this time lag effect can be even longer when the research is based upon previously published studies or analyses of clinical records.

The lesson here is that while CER and similar research can provide very important and useful information, it must be put into the proper historical and clinical contexts.  What was state-of-the-art when the research protocols were developed may be 2, 3, 4 or more years out of date when the data is analyzed.  This reality needs to be considered when such information is used for coverage and reimbursement, and decisions about health delivery and financing system redesign.

I am confident that most insurers are not paying for A1C tests to screen people for diabetes - and that it will likely take a year or more for even the most progressive insurers to do so…. but they eventually will.  Which raises the question, what did they gain by waiting?  And what did they, (and the patients), lose?

Addendum: The hospital lab my doctor uses charges $59 for a HbA1C test.  So assuming that price doesn’t come down if more people are getting the test, the calculation needs to be made as to what is the ROI for using HbA1C as a screening test?  And the CER questions are how to identify people who would most likely benefit from HbA1C screening, and how to determine how frequently the screening should be done?

Posted in Comparative Effectiveness, Delivery of Healthcare, Economics & Financing, Health System Reform, Information & Communications, Quality of Care & Safety | No Comments »

Be Prepared for the Outcomes of Health Reform

By Michael D. Miller MD
June 8th, 2009

Predicting the future is easy.  Accurately predicting the future is hard.  While some people make a living by predicting the future, most will not admit to this truism.  But the difficulty of accurately predicting the future of legislation and politically driven processes is what makes it important for policy makers to be prepared with contingency plans.

Eagle Scout Badge - Be Prepared

“Be Prepared” is the Boy Scout motto.  As a boy scout many years ago, I learned that this was more than just a saying, it was really used to guide planning and decision making for all sorts of activities: camping, cooking, first aid, sporting events, community service projects, etc., because by preparing for all contingencies, when something unplanned happened it wasn’t a “crisis,” it was just a detour that wasn’t part of the “original plan.”

Being prepared is important for the success of health reform as the debate intensifies this month, because there are many, many things that could influence the outcomes.  Some of these factors are intrinsic to healthcare and the legislation - such as how to pay for health reform - while others are extrinsic to healthcare and the specific legislation.  (I’ve made a list of the extrinsic derailing possibilities, but it is too long to include here.)

What contingency planning means for health reform is that not only does there need to be a multi-year implementation plan for the specific provisions of any new health reform law, but there also needs to be preparation for the unexpected - but inevitable - hurdles that will get thrown into the path of the development and passage of any legislation.

59 Days Until Reconciliation
While the legislative process is complex enough - and has been characterized as herding blind and deaf seagulls - such contingency planning is crucial because as of Monday, June 8th, there are 59 scheduled legislative days, (including Mondays and Fridays), before October 15th, which is the deadline Congress has set to pass health reform without the Senate resorting to using the Reconciliation process.

Passing health reform legislation via Reconciliation has some significant implications for the content of health reform - which is why it should concern stakeholders of all types.  While the Reconciliation rules are somewhat complex, the gist is that provisions which don’t influence Federal spending can be excluded from Reconciliation bills.  Therefore, if the bill developed this summer includes provisions to reshape the healthcare delivery system or improve quality, but which don’t change Federal spending within a ten-year period, then they can be dropped from the legislation.  (This budgetary analysis is conducted by the Congressional Budget Office, which is another reason why their “scoring” of legislation is so crucial.)

Focusing on Immediate Symptoms v. Actual Problems
This could mean that substantive provisions for transforming healthcare delivery to improve long-term quality and cost control may be dropped from health reform legislation, resulting in a bill focusing on more immediate cost cutting and not addressing some of the fundamental forces driving increasing costs.

I have characterized the difference between issues such as increasing costs, and the forces driving the increasing costs as being similar to the difference between medical problems and the symptoms they produce.  In this case, the symptom is increasing costs, while the actual problems are misaligned incentives and the resulting warped structures of the healthcare delivery system.

Legislative “fixes” have for many years focused on the symptoms - particularly short term cost reduction measures that some have characterized as rearranging the deck chairs on the Titanic.  This year presents the opportunity for some real reforms to the underlying problems that have become embedded in the healthcare delivery and financing systems. Whether that can be accomplished in the next 59 days remains to be seen.

Posted in Economics & Financing, Health System Reform | 3 Comments »

Theory v. Practice in Health Reform

By Michael D. Miller MD
June 1st, 2009

Two great articles came out last week about the role of physicians in health reform - both as the source of problems and the need for them to lead in implementing solutions. (These articles also made me think back about some of my own positions on physicians engaging in health policy - see the bottom of this post.)

The first article was by Atul Gawande in the New Yorker, where he explores how physicians contribute to some communities having higher healthcare costs than others.  The second article is in the New England Journal of Medicine, and is written by three distinguished health policy thought leaders, (Elliott Fisher, Don Berwick and Karen Davis), who discuss how physicians can help implement positive reforms.

While Drs. Gawande, Fisher, Berwick and Davis all know the same data and studies about the US healthcare system, the NEJM article discusses possible solutions at a theoretical level and advocates macro solutions that each of them have been associated with, e.g. Accountable Care Organziations (Fisher) and Triple Aim (Berwick).  In contrast, Dr. Gawande goes to the practical ground level and explores why one town in Texas has such high healthcare costs.  His conclusions are illuminating, scary, and not surprising to most health policy experts: The high healthcare costs are due to the overuse of medical services, (particularly some high cost tests and services), and this overuse is driven by profit incentives for physicians who have essentially shifted from practicing medicine in the interest of patients to running a business for the benefit of their bank accounts. (What is surprising is that while many of the local physicians understood this, the hospital administrators apparently didn’t recognize this situation.)

The importance of this ground level view for achieving the high performing health system envisioned by Karen Davis and others, should not be underestimated.  With hundreds of thousands of physicians in the US - and most of them still working in small practices - changing clinical behaviors faces high hurdles.  In theory, changing financial incentives to reward quality rather than just quantity of care provided should make significant improvements in cost growth and quality of care.  However, achieving this without very damaging negative consequences will requires two major leaps. First, clinicians who are currently running profit maximizing medical businesses have incentives to oppose any changes.  And second, if incentives are changed to reward quality, then there will need to for extensive information gathering and monitoring to ensure that the same profit maximizing behaviors that currently predominate in certain communities don’t result in patients being denied appropriate or needed care under what would likely be bundled payment systems.  (This is why information gathering and monitoring needs to include both process and actual outcome measures which can be used to evaluate clinical and economic aspects of the healthcare system’s operations for both individuals and entire communities.)

My own belief is that successfully remaking the US healthcare system to perform higher and achieve the Triple Aim - whether it be through Accountable Care Organizations, other forms of integrated delivery systems, or Patient Centered Medical Homes - will require greater input and buy-in from physicians.  And this will require significant local leadership - from both physicians and other community champions for change.  I stated my belief in this last fall when being interviewed for the Massachusetts Medical Law Report’s Rx for Excellence Leader in Quality award. (see below)

My belief that leadership and communications by key individuals are needed for health reform to be successful hasn’t changed since the early 1990s.  For example, I recently came across an EBRI report that quoted me discussing this in a 1992 meeting: “Mike Miller of Rep. Sander Levin’s office swung back to the need for leadership. ‘People want change but there is no agreement beyond this,’ he said. ‘Leadership has to put together the policy and sell it to the people, communicating the benefits and down sides, showing how it is better than what we have now.’”

The bottom line is that because physicians’ decisions determine about 70% of healthcare spending, physicians can and should both play a role as leaders in developing what changes make up “health reform,” and in communicating the value of these changes to both their peers and their local communities.  The alternative is more of the same.  And it is becoming increasingly unclear how sustainable our current system is, so that at some point the money eating system we have built may collapse like General Motors.

Posted in Economics & Financing, Health System Reform | 3 Comments »

Savings from Comparative Effectiveness Research

By Michael D. Miller MD
May 28th, 2009

The May 23rd issue of National Journal has two very interesting pieces about Comparative Effectiveness Research.

Scoring Savings from CER:
The first is in an interview with CBO Director Doug Elmendorf which includes this Q&A about scoring savings from CER:
“NJ: In the first five years after studying comparative effectiveness, are the savings that CBO can find relatively small?
Elmendorf: The estimates that we’ve done in the past suggest that by the 10th year, you are saving about as much as the cost of the research itself.  By the fifth year, you are not.  We would expect there to be savings in the private sector.  The federal government captures only a piece of that through the tax effect.  What I haven’t told you about is the net effect of comparative effectiveness research on national health expenditures.  That will tend to be a net saver for the country sooner.”

CER in Health Reform:
The next article in the NJ issue, (“The Risk of Comparing Treatments”), is about the possible inclusion of a new agency or independent institute to conduct or oversee CER. The legislative fate of such organization may hinge upon how CBO scores increased or continued funding for CER, and as seen above, it seem unlikely that CBO will attribute large savings to CER.

While scored savings from CER may be small, the fight about how CER should be used is getting hot.  The NJ article also discusses two new organizations that sound somewhat similar, but are actually on opposite sides of this issue: The Partnership to Improve Patient Care, and the Alliance for Better Health Care.  The former includes innovative companies and groups from industries such as biotech, pharmaceuticals and medical devices. While the latter includes health insurance plans, physicians and others.

Interestingly, patient organizations are divided between the two, with more disease specific groups who place a high value on the discovery of new treatments are aligning with PIPC, while broader “consumer” organizations that prioritize better information about existing therapies have signed on with ABHC.  Similarly, biomedical researchers could be viewed as split about CER, with academic researchers viewing the $1.1Billion in new CER money in the stimulus bill as a great opportunity for more funding, while industry researchers understand that the use of CER to make reimbursement and coverage decisions could reduce the incentives for investors to fund innovative private sector R&D.

So stay tuned.  The next event in the CER skirmishes will likely be around what the Finance Committee includes in their legislation about a new agency or institute for CER in the bill they are expected to unveil in a week or two.  Look for this issue, and other aspects of CER, to fuel one of the more interesting controversies within the health reform debate this summer.

Posted in Comparative Effectiveness, Economics & Financing, Health System Reform, Information & Communications | No Comments »

Health Reform’s Line in the Sand

By Michael D. Miller MD
May 27th, 2009

The public plan option was expected to be the most politically contentious issue in the health reform debate - and it now clearly is.  MoveOn.org has declared it the #1 priority in health reform, and the National Journal’s most recent Insiders Poll has put forth some striking numbers about the clear partisan divide on this issue.  The question they asked in the poll published in their May 23rd issue was “What is your view of including a new public insurance plan in health care reform?”  And the results are shown in the graph below:

Public Plan Option - National Journal Insiders Poll

With 62% of Democrats saying they MUST have it, and 83% of Republicans saying they CANNOT have it, the public plan is clearly a partisan line in the sand.

The debate over the public plan option is clearly a political weapon and not just a policy difference, because exactly what the public plan option would be hasn’t been decided or even extensively discussed.  For example, would it be modeled after Medicare? Medicaid? The Federal Employee Health Benefits Program? (FEHBP, like many large employer plans, is a menu of private insurance options, none of which are actually run by the government.)

The political nature of the “dialogue” over this issue is evident from the some of the quotes from the Insider Poll participants:

Democrats:
“Without a public plan, it is total capitulation to the insurance industry.  And we know what they have done to us.”
“The public deserves the same service that members of Congress and federal employees receive, a public health insurance option.”

Republicans:
“Why on earth would we want another health care program modeled after Medicare and Medicaid?  Because they are such stellar models of well-run, top-notch health care? Not!”
“The ultimate goal of a public insurance plan is to create a single-payer system.”
“Please, please push for this, Madam Speaker, Leader Reid.  Beating you over the head with government-run, rationed health care is pure joy.”

Is Compromise Possible?
Some of the interesting compromises around a public plan option include having the public plan be a “fall-back” that would only be created if certain benchmarks for choice, (and possibly cost), are not met.  (Such a fall-back provision was included in the Medicare Part D law to ensure that there were sufficient choices of Medicare Part D plans in all parts of the country.)  And FEHBP, which as noted above has been mentioned as a model for the public plan option, might not face the same level of criticism about it leading to a national single payer plan, because - like the Commonwealth Connector in Massachusetts - it is comprised of choices of private insurance plans….and I don’t recall hearing Republican Members of Congress calling for eliminating FEHBP.

Posted in Federal Healthcare Reform, Health System Reform, Politics | 4 Comments »

Healthcare Policy and Healthcare Politics - Summer 2009

By Michael D. Miller MD
May 26th, 2009

As Congressional Committees appear to be steadily walking towards the starting line for considering health care reform legislation next week, I’ve been thinking about various healthcare policy and political events and activities that will influence the substance and process for these efforts over the coming months - and perhaps years.

Because a complete examination of all the important events and documents from the last several months and years would be too long for a single post, summarized below are some of my observations and thoughts about the meaning of 5 touchstones that people will likely reference in the coming months as part of the health reform dialogue:

  1. Massachusetts’ health coverage and reform initiative
  2. The Senate Finance Committee’s 3 Policy Option Papers
  3. Frank Luntz’s health care talking point paper for Republicans
  4. The May 11th letter from 6 national groups to President Obama
  5. The Democratic Party’s development of Organizing for America

As discussed below, each of these activities and documents has dual (or dueling) policy and political goals, (i.e. changing policy to improve the healthcare system, or designed to win political points), that may be aligned or in conflict.

1. Massachusetts Health Coverage and Reform Initiative

  • The original legislation was a political compromise that included:
    • The use of private insurance to expand coverage
    • An individual mandate
    • An employer penalty for not having all their workers insured (a.k.a. play or pay)
  • Single payer is discussed and supported in Massachusetts, but wasn’t part of the state’s health reform initiative
  • The state’s Commonwealth Connector insurance exchange doesn’t include a public plan choice/option
  • Despite not being a single payer system, nor including a public insurance plan option, the state’s initiative expanded insurance coverage to more than 97%
  • With the success of increased insurance coverage has come expanded demand for primary care services and subsequently longer waiting times for those services
  • The state is looking at various processes for controlling costs as a second outcome to be achieved
  • The state’s ability to control health care spending will likely require Federal regulatory and/or legislative cooperation from programs such as Medicare, Medicaid, and ERISA

2. Senate Finance Committee’s Policy Option Papers

  • Between April 29 and May 20th the Senate Finance Committee released 3 papers describing options for health delivery system transformation, expanding coverage, and cost savings and revenue raising.  (The Committee also held hearings on these papers.)
  • The overarching theme in these papers is transparency and accountability
  • Several issues are notable for their absence from the papers:
    • Discussion of a single payer option for overall reform
    • Cost savings estimates for a public plan option
    • Changing or repealling Medicare Part D’s “Non-Interference” provisions as a source of revenue
  • The only mention of ERISA is in the savings and revenues paper - It is not discussed in the context of health delivery transformation or expanding coverage
  • Medicare’s physician payment formula problem is discussed, and the cost of a 10 year freeze is cited as $285 billion
  • Accountable care organizations (ACOs) and care coordination are frequently mentioned goals, but the papers generally only propose demonstrations or pilot projects rather than definitive programmatic changes

3. Frank Luntz’s “The Language of Healthcare 2009″ Paper

  • This paper advises Republicans how to talk about healthcare in a purely political context.  It doesn’t substantially address policy aspects of health reform issues, and it is all about winning as many Republican and moderate hearts without considering their minds
  • The goal of Luntz’s talking points are to paint Democrats’ health reform plans as leading to government bureaucrats making health care decisions, rationing of care, and denying access to necessary care
  • The paper builds upon the premise that patient-doctor relationships are good and that government bureaucrats are bad.  It specifically states that the Democrat’s “government takeover” of the healthcare system will result in a bureaucrat putting “himself between you and your doctor, denying you what you need”
  • Luntz’s paper leverages people’s fear about loss of control and autonomy, but it doesn’t address people’s immediate and real concerns that high costs are denying people access to the insurance or care they need - in effect rationing based upon the ability to pay for the ~49 million people in the US without health insurance and the millions more who are underinsured because they can’t afford their co-payments or deductibles

4. May 11th Letter to the President from 6 National Groups

  • The 2 page letter from AdvaMed, AHA, AHIP, AMA, PhRMA, and SEIU is mostly political posturing
  • The letter uses all the right phrases:
    • “access to affordable high quality health care”
    • “transform the health care system”
    • “transparency that supports effective markets”
    • “aligning quality and efficiency incentives”
    • “encouraging coordination of care”
    • “adherence to evidence-based best practices”
  • Karen Ignagni deserves big kudos for pulling together the other 5 groups and getting agreement for the letter, but herding their collective seagull-like members into agreement for specific reform proposals - other than an individual mandate to have insurance - will be a much bigger challenge, as Paul Krugman recently discussed in his recent column
  • Getting all these groups to the same side of the same table is a success of process, but not a successful outcome.  A collective meeting of minds of similar groups was necessary for the enactment and implementation of Massachusetts’ coverage expansion law, and it is also being used in the state’s efforts to control the growth of healthcare spending

5. Organizing for America (OFA)

  • The Democratic National Committee (DNC) is working to develop OFA as a program to capture the grassroots energy and organization of the Obama campaign, with the goal of using OFA to support the Administration’s policy initiatives - the first of which is healthcare, to be followed by energy and education
  • On May 16th I attended an OFA-MA organizing meeting - along with about 500 other people from around the state. The open Q&A and my discussions with individuals made it clear that single payer has strong and wide support in this group, despite candidate and President Obama’s consistent message that if we were designing a system from scratch, single payer would be an attractive option, but given our immediate needs and problems, other significant targeted changes are needed to improve people’s lives by increasing coverage and controlling costs quickly and effectively.  (Not too mention that such targeted changes face much lower political hurdles than a single payer reform option.)
  • OFA is gearing up for Congress’ consideration of heatlhcare legislation by organizing house parties across the country on June 6th to gather individual stories and prepare the OFA grassroots rooters to engage their elected representatives, the media, and whoever else they can reach on healthcare reform

Conclusions

  1. How to pay for health reform still hasn’t been determined, and this summer Congress will also have to “fix” Medicare physician fee schedule - which will cost about $20 billion/year
  2. The most difficult aspects of health reform, (outside of paying for it), are how to do risk/severity adjustments for payments and quality analyses, how to measure the success of initiatives using a blend of process and outcome measures, and how to estimate, (or “score”), costs or savings from many of these initiatives - particularly for those that involve behavior change, disease prevention or health promotion, or are expected to act synergistically with other initiatives, such as patient-centered medical homes or other care coordination intensive models
  3. Agreement on principles is easy, but agreeing to specific proposals is difficult because one person’s waste is another person’s income
  4. ERISA is the 500 pound gorilla-issue sleeping in the corner
  5. Massachusetts is different than most other parts of the country - both in terms of policy and politics - but its experience presents valuable lessons about the process for bringing stakeholders to the same table and for creating a health insurance exchange with low-income subsidies
  6. Politics will be required to enact national health reform legislation, but the specific policies put into new laws will be important for determining their success or failure upon implementation, because a disconnect between politics and policy can result in legislation that produces outcomes different from what are intended.  For example, the Balanced Budget Act of 1997 changed the Medicare managed care program, (and renamed it Medicare+Choice), with the goal of expanding managed care options for people enrolled in Medicare.  However, following BBA ‘97 Medicare+Choice options decreased rather than increased.  In addition, success or failure of one initiative sets the environment for the next, e.g. the failure of BA’97 to expand Medicare+Choice enrollment created the context for the development of the Medicare Part D prescription drug program in 2003.  Similarly, the success of Massachusetts’ expansion coverage law has enabled the state to explore options for controlling overall health spending as a next step - something that would not have been possible if the expansion law had failed or been derailed…… as it had been twice before.

Footsteps


Posted in Access to Healthcare, Delivery of Healthcare, ERISA, Economics & Financing, Federal Healthcare Reform, Health System Reform, Medicare, Politics | No Comments »

People in Health Reform & Transformation

By Michael D. Miller MD
May 20th, 2009

The importance of the “people factor” in improving the quality and efficiency of healthcare is well understood by experts in health information technology (HIT) and healthcare delivery transformation.  In estimating the time and cost for implementing new technologies or processes, they appreciate how behavior change and technology adoption are very time consuming and expensive – factors that are often glossed over in policy discussions.

David Brooks’ recent Op-Ed in the New York Times about the personality traits of CEOs leading successful companies sheds some light on the people factors in health reform.  Contrary to a lot of the common wisdom about the importance of good personal connections with coworkers for success in the corporate world, Brooks cites information that the most important factors for successful CEOs are “execution and organizational skills. The traits that correlated most powerfully with success were attention to detail, persistence, efficiency, analytic thoroughness and the ability to work long hours.”

He goes on to state that what produces effective CEOs are “emotional stability and, most of all, conscientiousness — which means being dependable, making plans and following through on them.”

In the medical world, this would describe most surgeons, but the difference between the corporate and medical worlds is that CEOs have greater direct control over their people and organizations than do the leaders of health delivery organizations like hospitals or clinics, which rely on the performance of many different professionals and skilled staff who function quite independently, such as doctors, nurses, and many types of therapists.  Thus, while “being a good listener, a good team builder, an enthusiastic colleague, a great communicator [does] not seem to be very important when it comes to leading successful companies,” in the clinical world, these traits are very important.

Brooks’ comment that, “business leaders tend to perform poorly in Washington, while political leaders possess precisely those talents — charisma, charm, personal skills — that are of such limited value when it comes to corporate execution,” correlates very well with my observations of senior corporate managers, politicians and clinicians.  I have seen business leaders who are successful in working the political circuit but have struggling corporate organizations, and politicians who enter the business world – often as leaders of lobbying or policy organizations in Washington DC – whose operations are chaotic and inefficient.

However, there are a wide variety or organizations in the healthcare universe’s 4 spheres, and the leadership qualities best suited for increasing quality and efficiency depend upon the sphere the organization is operating in, the type of organization, and the local culture.  For example, leading a biotech, medical device, diagnostic, HIT, or pharmaceutical company requires the type of hyper-focused “boring” CEO described in Brook’s column.  But successfully leading a hospital, clinic, or private medical office requires someone who has relatively stronger people skills.  And someplace in the middle would be the leadership of health plans which have to bridge the business and clinical worlds, and leaders of government agencies which have to straddle the policy and political arenas.

Keeping the importance of the people factor in mind while developing health reform and transformation proposals will help create realistic expectations and time lines – both for the actual transformation of care delivery and the ability to achieve cost savings.  For example, as CBO noted a year ago - and I’ve previously commented on - the ability of health information technology to achieve cost savings is dependent upon how those technologies actually change behaviors of clinicians, patients, and others - a process which is very time consuming and expensive.

Posted in Delivery of Healthcare, Health System Reform, Information & Communications, Quality of Care & Safety | 1 Comment »

Health Reform Deja Vu All Over Again

By Michael D. Miller MD
May 15th, 2009

On Monday the President announced three basic principles for health reform:

“First, the rising cost of health care must be brought down; second, Americans must have the freedom to keep whatever doctor and health care plan they have, or to choose a new doctor or health care plan if they want it; and third, all Americans must have quality, affordable health care.”

After reading this, I was struck how this statement sounded similar to the principles for health reform in 1993 - So I dug out of my archives the “Health Security Cards” I’d gotten while working on that health reform effort:

Health Security Cards - Front (1993)

Health Security Cards - Back (1993)
(Paper card is on the left, and plastic card is on the right)

Comparing the two sets of principles it is clear that cost, choice and guaranteed access have continued to be top priorities.  Interestingly, in 1993, “Preserve Medicare,” and guaranteeing benefits “at work” were also specified, and the first bullet on the paper card guarantees “private insurance” - which may be different than the current push for a public plan option, which MoveOn.org declared in an email to be “the most important part of Obama’s plan.”

While I believe the current Administration is committed to Medicare, the solidity of support behind employment-based insurance has slipped in the last 15 years because outsourcing and offshoring have reduced the employment rolls of large employers, and a few major manufacturers have turned health benefits over to employer organizations.  (Note: some of these VEBAs have suffered greatly because of the auto industry’s troubles.)  In addition, some Congressional leaders have talked about changing the tax treatment of employer subsidized health insurance - although I think this is based on both policy and fiscal grounds because reducing the tax deductibility of such benefits could raise significant amounts to fund other parts of “health reform.”

This comparison also shows that it is important to understand the historical context for these issues, and that there are only so many words to describe the type of health system we want to guarantee: access, affordability, choice, compassionate care, quality……

What will happen with health reform this time around remains to be seen, but two things are clear.  First, the process this time is much more collaborative among Congress, the Administration, and private sector groups. And second, whether health reform involves new laws, regulations, or private sector voluntary actions, the details won’t be printed on the back of a card, and considerable effort will be required to guarantee that these changes improve access, affordability, choice, compassion, quality……

Posted in Federal Healthcare Reform, Health System Reform, Politics | No Comments »

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