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Missing Pieces of Health Reform

By Michael D. Miller MD
February 23rd, 2010

At a briefing in Washington DC this morning, two very well respected and reasonable economists talked about how the increasing prevalence of chronic diseases and care delivery in outpatient settings are driving up costs in Medicare.  They also asserted that a greater focus on real cost containment - and possibly cost reduction - should be the focus of health reform, and that this could be achieved by increasing team based care coordination and increasing personal responsibility for care and costs, among other focused initiatives that might require political courage…..which one of them noted appears to be currently in short supply.

Their conclusions and analyses are all well reasoned and reasonable, but having listened to these types of analyses and briefings for more than 20 years I was stuck by two things.  First, what they were saying wasn’t significantly different from what people had been saying for, well, more than 20 years.  And second, like most presentations about health reform, they focused on what needs to be changed but didn’t talk about how to create that change - except to focus on altering economic incentives.  (It is worth noting that one of the panelists recommended that government programs such as Medicare should consider not just creating incentives for people and providers to do certain things, (like use electronic medical records),  but rather should say, “if you want to get paid by us, you will do things this way.” Clearly this type of ‘my way or the highway’ approach can be effective, but it also faces much higher political barriers because it could result in a number of doctors and other care providers being excluded from Medicare.)

Motivators Other Than Economic Incentives
What also struck me about their focusing on economic incentive as the driver of change is that this can work for some people and organizations, but in healthcare, there are other factors driving people’s behavior - particularly the behavior of patients and community practicing physicians.  For patients, if they were to act the way economic models would predict, (i.e., always in their best economic interests), everyone would brush their teeth and floss more often, exercise regularly and rarely eat anything that came out of a frozen box or a deep fryer.  But such economic modeling assuming that people act based upon full knowledge AND that their economic interests are the overriding force behind their decisions.  And in the real world, neither of those assumptions are true.

So what’s missing from the health reform prescriptions based upon changing economic incentives for physicians, patients and others?  First,  increasing relevant and useful information can help increase the impact of whatever economic incentives are created.  For example, showing physicians that their practice patterns are different that their local peers can help motivate them to change how they care for certain conditions in ways that economic incentives may not.

And second, non-economic motivators for behavior change can be created that are aligned with  financial incentives (and disincentives) to change actions and attitudes.  These types of motivators are particularly important for individuals - whether they be patients or individual physicians.  In addition, initiatives to change individual behaviors and actions need to recognize the 80-20 rule, where 80% of people go one way and 20% don’t.  In promoting care delivery changes it might be more accurate to call it the 10-70-20 rule, where 10% of clinicians are early adopters, followed by another 70%, with 20% resisting the adoption.  Thus, the key to changing clinical practices at the individual level, (i.e. getting real world clinicians to adopt the care practices of “evidence based medicine” that health reformers talk about), is to get the early adopters to rapidly adopt the better care practices, and for them to become active  teachers and proselytizers for these changes with the receptive 70% of their peers.  (Note: the early adopting 10% are sometimes called change agents or agents of change.)

The remaining 20% who resist change should slowly be convinced by their peers resulting in longer term improvements. And in the shorter term, getting 80% adoption of changed care practices that improve quality and reduce costs would equate to some tremendous improvements for patients and society.

Returning to the Book
How to develop and implement initiatives involving such non-economic motivators and pair them with economic incentives to transform healthcare delivery - resulting in increased quality and reduced costs - is a core part of the book I’ve been writing.  Unfortunately, I’ve been trying to figure out how to make the book relevant within the rapidly evolving health reform environment over the last 2+ years.  Now that the dynamic has shifted back to fiscal responsibility and cost containment, and health policy is all about health politics, it may be time to finish the book so that it will be available for policy makers and stakeholders when health reform initiatives return in 2011 and beyond. If you have any thoughts or suggestions about these issues or the book, please feel free to comment here or contact me at the physical or email addresses on my contact page.

Posted in Delivery of Healthcare, Economics & Financing, Health System Reform | No Comments »

Miscommunicating the Government’s Powers for Health Reform

By Michael D. Miller MD
February 8th, 2010

The Virginia state legislature recently passed a law making it illegal “to require individuals to purchase health insurance.” This action reminded me how commonly the extent of governmental powers are misperceived.

The Virginia legislature’s action follows those in other states, and are in line with the “tea party” groups’ opposition to the general direction of national health reform. But what exactly it means for a government’s actions to be “illegal” is also unclear. And as Tuesday’s Washington Post article on the Virginia bill states, “it would have little practical impact because it would be preempted by federal law.” Thus, the actions in Virginia and other states are more political than substantive, and seem to be more about the states’ laying down markers should they later want to take the Federal government to court over any individual mandates for buying or having insurance.

Powers of the Government
Hidden underneath this political discussion of the “illegality” of health insurance mandates is exactly what the government can and cannot do to force or entice people to do things.  And while academic and legal scholars may take some issues with my simplified description of governmental powers, there are basically four broad options for what governments can do to try and change people’s actions:

1. Attack
Making war, (or other type of overt or covert intervention), is probably the most dramatic of the Federal government’s powers, but presumably doesn’t have a role for health reform and mandates for buying insurance, etc.

2. Incarcerate
The government does a great job of putting people in jail, but I haven’t heard anyone talking about jail time as a penalty for failing to have health insurance.  However, healtcare for prisoners has been a potent political and policy issue at different times.  For example, it was a key message in Harris Wofford’s victorious 1991 special Senate election in Pennsylvania when he noted that if prisoners had a right to healthcare then so should all Americans. And at a much more granular level, there have been cases where prisoners have tried to stay incarcerated so they could get care for health problems because if they were freed they would have been uninsured.

3. Money, Money, Money
Money is the lever governments uses most frequently for non-criminal activities, such as health insurance, housing, food, etc…  At the most basic level governments can either give money, (e.g., tax credits, food stamps), or take it away, (e.g., higher tax rates, fines, penalties, or denial of tax deductions or credits, etc.). And the mechanisms for giving or taking money can be divided between taxes and cash - or cash equivalents like housing vouchers.

For example, in Massachusetts, the individual and employer health insurance “mandates” are enforced by financial penalties, i.e. not jail time.  Similarly, fiscal incentives for individuals and states to have or provide health insurance are very common, e.g. the increase in Federal Medicaid matching rates included in the 2009 stimulus law.

Of course, there are often strings attached to the receipt of money or benefits because neither governments nor private citizens are in the habit of leaving cash in a bag for someone to pick up and do with what they please. That is why government programs have participation requirements just as private contracts have provisions for what must be done before money is exchanged.

4. Talk the Talk
The last tool governments can use to influence actions is the power of the speech, persuasion, and illustrative illumination.  Elected and senior appointed officials have the advantage of having their words amplified through the press. Such officials can also identify individuals and companies who have done good things, as well as not-so-good things.  This type of individual identification can be very powerful, but may also be politically dangerous if praise is directed towards those who has skeletons in their closet, (either literal of figurative), which then become public.

The last type of tool that governments can use to change the world is to use government program operations and purchasing decisions to lead by example. This type of Walk the Walk action is a combination of money and talk, and an example is the State of Massachusetts using their state employees’ health benefits program to advance quality of care by using information about individual physicians to create incentives for employees to go to physicians who are rated the highest in quality. This initiative was controversial but it survived a court challenge in the State, unlike a similar initiative in New York State.

Leading by example is often not as simple as creating targeted economic incentives, because such actions can run into government procurement rules, international treaties, union contracts and other legal limitations on government actions - which may be why this tactic is not commonly used for driving public policy changes.

Conclusions
While the Federal Government has considerable power and resources, the history and legal system of the United States limits governments’ powers so that giving and taking money is the primary tool used to enforce “mandates” and “requirements.” The result is that people, companies and even state and local governments have a choice - comply with the Federal rules and get the money, or don’t and don’t get the money, or maybe even lose some money.  For example, as I noted in my last posting, the State of Arizona didn’t get any Federal matching funds for Medicaid for over 15 years because they chose to not have a Medicaid program.  Similarly, the mandates in Massachusetts for having health insurance are “enforced” by tax penalties for individuals and businesses - although the number of people and companies effected has been relatively small because of the exemptions for smaller companies and affordability for individuals.

Leading by example - either in how they run their internal operations or their procurement/contracting - is an option which governments have used less often to advance specific policies. In a time of fiscal constraints, leading by example might be a good way to leverage limited Federal money and resources - particularly around the contentious issue of health reform where it could help demonstrate the positive value of better healthcare benefits and care delivery for employees, organizations and society.

Posted in Access to Healthcare, Delivery of Healthcare, Economics & Financing, Politics | 1 Comment »

The Path Forward for National Health Reform

By Michael D. Miller MD
January 31st, 2010

The path forward for health reform is becoming clearer now that the dust from the Democrats losing their 60th vote in the Senate is settling.  While a freestanding, comprehensive law now seems very unlikely, achieving the core goals of health reform are possible via the regular order of a Reconciliation bill, demonstrations and pilot programs, waivers, existing authorities, and the appropriations process.

It’s the Stupid Economy
First, the President has appropriately reraised jobs and the economy to be his highest priority.  This shift may both help defuse the hyperpartisaness that has enveloped health reform, and increase action to improve the economy and create jobs since they are the source of the public’s ongoing angst and frustration.  However, the Administration and Congress should continue to pay attention to health reform since people’s concern over the economy and job-lock are partially driven by worries about the affordability of health insurance and healthcare.  In addition, location-lock for small businesses and entrepreneurs because of different state health insurance laws may be supressing job growth in those sectors… something I recently investigated in moving from Massachusetts to DC.

Reconciliation - Part 1
Second, any action related to health reform will need to embrace fiscal responsibility and deficit reduction.  This clearly points towards a Reconciliation bill that reduces the growth in Medicare spending, (and extends its solvency), along with some Medicaid changes to accommodate increasing enrollment while limiting States’ fiscal exposure in a down economy.  This type of Reconciliation bill would be similar to those that both Democratic and Republican controlled Congresses have passed in the last 20 years.  (In the current political alignment, Democrats will have to counter Republicans’ accusations that they are cutting Medicare rather than just slowing spending growth. Both characterizations are “true” depending on your political objectives.)

Strategic Demonstrations, Pilot Programs and Waivers
Just nipping and tucking at Medicare spending and increasing Medicaid’s enrollment and financial support to the States won’t meet anyone’s definition of health reform.  Therefore, to move the US health system along the path of reform to expand coverage, improve quality and control costs, there are targeted initiatives that the Administration and Congress can pursue to push forward with reforming health delivery and financing:

First the Administration can get much more aggressive with its use of Medicare demonstrations and pilots. These can build upon the HIT and CER programs included in last year’s stimulus bill as stepping stones for health reform.  The Administration already started in this direction with their “Demonstration Grants for the Development, Implementation, and Evaluation of Alternatives to the Current Medical Liability System” announced last September.  Granted this program was designed to provide some cover for Congressional moderates and to probably curry favor with some clinician groups, but the Administration also has the ability - and in some cases the legislative authority - for many other types of demonstrations and pilots.  For example, they could:

  • Proceed rapidly with the Advanced Primary Care (APC) model type of Medical Home demonstration they announced last September - and which I wrote about previously.
  • Resurrect the straightforward Medicare Medical Home demonstration that Congress authorized in 2006 for eight locations. (In 2008 authorization was expanded to as many locations as HHS wants.)  This demonstration was scuttled last fall because the evolving health reform legislation had language replacing it with two new ones.  Since the draft regulations for this program were completed in December 2008, they would just need to be updated and finalized for the program to start later this year or January 2011.  There is also no reason that this Demonstration couldn’t run in parallel with the APC Medical Home demonstration - perhaps in different geographic locations.

For these and other demonstrations and pilot programs, the key for success will be structuring them somewhat like clinical trials so that people and organizations are assessing very similar, if not identical things.  This would not be “cookbook medicine” since these demonstrations should focus on the organization of care delivery and not on individual care decisions. For example, the Medical Home demonstrations mentioned above are about the organization of services provided by primary care practices, not the specific decisions made by clinicians for individual patients.  Similarly, the use of surgical checklists is an operational process that has been shown to reduce errors, increase the quality of care, and reduce costs.  However, it does not specific what procedures the surgeon performs or how the anesthesiologist delivers medicines, etc.

One of the failings of past demonstration programs has been that they have been structured to analyze what people are already doing rather than ways of delivering care that might improve outcomes. For example, the Medicare care coordination demonstration that reported its “conclusions” last year failed to demonstrate very much since it was an evaluation of 15 different types of programs.  In addition, demonstrations are sometimes caught up in significant political and parochial interests.  This was the case for a demonstration program involving “Centers of Excellence” for cardiac care at hospitals.  This demonstration program was scuttled the first time around - and hobbled thereafter - because the hospitals in the demonstration’s geographic locations not deemed “Centers of Excellence” complained quite strongly - particularly to their Members of Congress.

Thus, evaluating what people and organizations are already doing is easy, but may not provide much useful information since care organizations tend to vary greatly in how they operate, even within local areas, so drawing specific conclusions from these types of semi-focused studies is difficult.  Conversely, evaluating specific care practices is harder because it requires changing day to day activities for clinicians and providers, but this type of more controlled experiment can actually demonstrate the value of a change.  And lastly, any of these demonstrations can be undermined by political or parochial forces so that the demonstration is stopped, delayed, or its requirements so diluted that the conclusions are of little value. Thus, to make these demonstrations valuable, career and political officials need to be diligent and have fortitude when they are developing, approving, and overseeing the creation and implementation of such demonstrations and pilots.

Expanded Use of Existing Authority
Once research projects have demonstrated and validated improved ways of delivering care, Medicare, (and possibly Medicaid and other Federal programs), could use their existing authority to pay more for the adoption of these changes - or pay less or not at all when they are not adopted.  For example, Medicare and private payers have stopped paying for so-called “never events,” i.e. clinical events that are completely avoidable and thus should never happen.  Similarly, it is probably within Medicare’s existing authority to not pay - or pay less - for surgeries or the insertion of central intravenous lines when a validated checklist is not used.  These checklists are process steps that have been proven to work and yet have not been universally adopted, which raises the question as to why Medicare is paying for clinical situations where these improvements are not used.

Medicare and Medicaid Waivers
Beyond demonstrations and pilots, and the use of existing authorities, Medicare and Medicaid waivers are other tools that can be used to implement significant changes. Waivers for Medicaid are much more common, and the entire Medicaid program could be viewed as a 50+ bags with 1,000+ waivers.  Technically these waivers are intended to “demonstrate” better ways of running Medicaid programs that would provide information for changing all Medicaid programs across the country.  In practice, these waivers have proliferated like Tribbles in a storage bin of triticale grain, with most States using many waivers for different aspects of their Medicaid programs.  (For example, Arizona didn’t have a Medicaid program until 1982 when it created its program under a statewide waiver. And Massachusetts’ health reform expansion law was only possible because of a revised/renewed Medicaid waiver.)

Medicare waivers are less common than Medicaid waivers, but can be more powerful.  For example,  Maryland’s Medicare waiver has enabled the state to run an all-payer rate setting system for hospitals for many years. And in the near future Massachusetts may be seeking a Medicare waiver to implement an all-payer bundled payment system that their Special Commission recommended last July.  Such a state-wide payment reform system would be an even more dramatic health reform step than the state’s insurance coverage expansion and coverage mandates. But it remains to be seen if the Massachusetts legislature will proceed with this important cost containment and quality improvement step - and if they can get a Medicare waiver when they are ready to ask for it since the Federal Government’s attitude toward such waivers may be different in 2012 or 2014 than it might be today, or was last summer.

Reconciliation - Part 2
It is clear that cost containment for Medicare, expansion of Medicaid, a flurry of demonstrations, pilots, waivers and the use of existing authorities would not constitute significantly health reform since even all together those initiatives would not significantly advance progress towards universal insurance coverage - a fundamental goal of health reform. And one of the criticisms of using the Reconciliation process in the Senate has been that the insurance expansion provisions and coverage mandates in the House and Senate bills would be stripped out under the Reconciliation rules.

However, having successfully included provisions in a Reconciliation bill when I was told that they would definitely be stripped out, I know that under the peculiar rules of Reconciliation all numbers that are the same are are not equal, and there are ways to configure provisions and their implementation to effectively achieve the following:

  • Implement significant and strong regulations/requirements/standards to prevent insurance and coverage denials, and pricing problems that are currently permitted under various loose state laws;
  • Create strong incentives for insurance coverage for most, if not all Americans;
  • Provide subsidies for low income people and small businesses to make health insurance affordable; and
  • Reduce the so-called “donut hole” in the Medicare drug benefit.

The first three of these are really the fundamental parts of health reform, and improving Medicare’s Part D benefit is a widely agreed upon goal. The other aspects of the legislation that was moving through Congress are important, but not really essential - and the public plan option has always been redundant and politically explosive pair of suspenders alongside the belt of strong insurance regulations.  In addition, these provisions are also supported by two of the major industries that could have opposed health reform - insurers and biopharmaceutical companies.

There may be some who would criticize the first three of these changes as causing prices to go up, etc. as they transform the health insurance marketplace in most states, but the reality is that this would replicate what has happened in Massachusetts - first with their insurance reforms in the early 1990s, and more recently with their coverage mandates and expanded low-income subsidies.  And despite some public rhetoric, it is working very well, people like it, and it provides stability and security for insurance coverage.  What it hasn’t done is address costs - which is why the state is looking at an all-payer bundled payment system which would give clinicians, provider organizations, and others  incentives to control spending without being intrusive into their care practices.

Paying for these legislative changes will of course be a challenge, but with a renewed focus on fiscal and social responsibility for the Federal Government and financial institutions, there are innovative ways to have all these health reform changes not result in an increase in the Federal deficit.

Conclusions:

  • The Administration and Congress should be making the economy and jobs their #1 priority, but should continue to work on health reform since health costs and the vagaries of the health insurance system continue to fuel people’s angst about job security and the overall economy.
  • Significant health reform can be done without massive restructuring in one sweeping bill.  Rather coverage can be expanded and costs controlled by constantly pushing and shoving, and massaging and tweaking. Many successful government programs have been built and improved over many decades using such an “incremental” approach - so it is a valid avenue for improving such a complex, multipronged, pervasive, and sinewy “industry” as healthcare.
  • Important and significant provisions were included in last year’s stimulus law, and additional government actions should be viewed as building on those initial steps.
  • Change is hard, but explaining the immediate and long-term benefits for individuals and society will be important for deflecting politically driven mischaracterizations.  In addition, pointing to Massachusetts’ success with insurance regulation and coverage expansion should demonstrate that such changes work in the real world.  And while many other parts of the country point to Massachusetts as a liberal, “Taxachusetts,” socialist enclave, the state’s recent election of Republican Scott Brown to serve the remainder of Ted Kennedy’s Senate seat should fully refute that mischaracterization.  If a state can elect Scott Brown, then they can’t be all that knee-jerk, socialist-liberal.

Next Steps
The next steps in the annual Federal legislative dance will be the release of the President’s budget proposal tomorrow, followed by the start of the Congressional budget process. The two things to remember about the President’s budget proposal are that it was written and locked up before the Massachusetts Senate election, and this document is generally as much about making political points and sending specific messages as it is about the numbers for specific programs and initiatives. That is, within the Administration’s overall 3 year freeze on non-security discretionary spending there will certainly be proposals for program increases and decreases, but it is Congress that actually makes these determinations. Thus many of the numbers and programmatic initiatives in the President’s budget proposal may be designed to score points with specific groups and to force Congress to make the hard decisions about where to get additional funding for its favorite programs that the President’s budget proposes cutting. For those who thought that President Obama would somehow transform or transcend the Washington political process this may come as a bit of a shock, but the reality is that the framework of the Constitution and the evolving nature of the US government and society promote the separation of powers and a balancing act among them, which at times can look something like an uncivil war.

Posted in Delivery of Healthcare, Health System Reform, Medicaid, Medicare, Politics | No Comments »

Checklists and Physicians’ Behaviors

By Michael D. Miller MD
January 12th, 2010

I recently heard Dr. Atul Gawande talk about his new book “The Checklist Manifesto.” While the evidence demonstrating the value of checklists for improving the quality of healthcare is increasingly abundant, in his presentation Atul talked about how in a study assessing a surgical checklist they ran into resistance from about 20% of physicians.

Another story he told involved his surgical group’s considering how they might manage bundled reimbursements, e.g. accepting a single payment for all the care and testing related to thyroid cancer surgery.  Their discussions came to a screeching halt when it became clear that this “might” mean less money for each of the surgeons. This uncertainty in personal income arose because accepting bundled payments would require them to distribute money among the people and organizations involved in the actual surgery, the pre and post surgical testing, and the follow-up, which can be a very complicated process.

His group of surgeons probably found this change too daunting because they didn’t have an overarching group/entity to help them assess how to distribute/divide a bundled payment, and actually manage and monitor the money and their financial performance.  While they are part of Partners in Boston - a large integrated health system that includes the  Mass General and Brigham and Women’s hospitals - it seems that Partners hasn’t reached the point of providing this type of support for their individual medical groups.

In the broader world of health deliver reform, to manage such bundled payments effectively physician groups might need to become part of - or affiliate with/have relationships with - medical homes and/or accountable care organizations.  If every group of physicians - particularly in a single specialty - had to figure out on their own how to accept and manage bundled payments, it is very unlikely to work, leaving us with our current perverse incentives of fee-for-service reimbursements that promote volume over quality.

What these two stories have in common is that they involve the barriers to positive transformations of clinical medicine.  Specifically, fee-for-service’s financial incentives give many clinicians few reasons to change to bundled payments or other reimbursement systems that don’t prioritize volume and don’t reward quality outcomes. Similarly, increasing the use of checklists and other care improving protocols faces significant barriers because while they don’t attack clinicians’ incomes, they can be seen as assaulting their professional autonomy.

Change Agents and Care Delivery Transformation
Part of the solution to both these challenges are support mechanisms to assuage clinicians’ concerns about loss of income and autonomy.  The simplest way to conceptualize these support mechanisms is as “Change Agents.”  For bundled payments, clinicians need some trusted group or organization that can help them understand how they will be compensated, what information they will get and how to use it, and how bundled payments may actually simplify their professional lives and even potentially increase their incomes - assuming they can practice more efficiently and effectively. For example, because medical care has become so complicated - with an ever expanding array of advanced diagnostic and therapeutic options - the use of checklists and protocols can help clinicians standardize the routine parts of care and thus cognitively free them up to focus on patients’ individual needs and goals, including how to optimize adherence to treatment plans. These changes will improve clinical outcomes, which is what patients want, and economic outcomes, which is what society wants because it will help stimulate the economy and make it easier to expand insurance coverage and access to care.

While Change Agents to support the successful adoption of bundled payments may be some combination of administrative groups and other clinicians who’ve successfully used the new reimbursement scheme, Change Agents for care innovations are most often other clinicians.  Typically these clinician Change Agents have real world experience showing how the innovation has actually improved the quality of care - particularly by saving an individual life or preventing a specific adverse event. (Dr. Gawande’s research group saw this in their surgical checklist study, and I found this in researching the use of telemedicine in intensive care units.)

Patients as Change Agents
Patients can also be Change Agents.  As I’ve previously written, if patients asked their doctors if they use checklists for things like surgery and inserting central IV lines, and then refused care from physicians (or institutions) that don’t use such checklists, there would likely be rapid adoption of these and other innovations as they are validated and their value communicated broadly.  Advocacy organizations can also fill this role, as can government agencies as part of their quality improvement activities through programs such as Medicare, Medicaid and the Veterans Health Administration - something I’ve also raised in a previous post.

Conclusions
Improving quality and slowing the grow in healthcare costs will require multipronged strategies.  What these strategies will have in common is that they will confront the significant barriers clinicians have in changing how they practice medicine.  Achieving this will require Change Agents - clinicians, patients, advocates, and government agencies who can demonstrate and support the value of care innovations.  Simple? No. Possible? Yes.  But as the pair of old sayings go: If it was easy anyone could do it. And if it was easy, someone would have done it already.

Posted in Delivery of Healthcare, Economics & Financing, Quality of Care & Safety | 1 Comment »

Cost and Coverage c. 1989-91: Part 2 of Historical Perspectives on Health Reform

By Michael D. Miller MD
November 17th, 2009

As I mentioned in my last post, in going through old files I found many memos and articles about health reform.  Some of them from 1989-91 illustrate the long history of the challenge of controlling costs and providing care for more people - and eerie similarities to the current debate:

For example, below are some pieces of text from articles and commentaries published in the New England Journal of Medicine from January 1989 - October 1990:

  • “A Consumer-Choice Health Plan for the 1990.  America’s health care economy is a paradox of excess and deprivation.  We spend more than 11 percent of the gross national product on health care, yet roughly 35 million Americans have no financial protection from medical expenses. To an increasing degree, the present financing system is inflationary, unfair, and wasteful. In its place we need a strategy that addresses the whole system, offers financial protection from health care expenses to all, and promotes the development of economically financing and delivery arrangements. Such a strategy must be designed to be broadly acceptable in our society. To remedy this deprivation, we propose that everyone not covered by Medicare, Medicaid, or some other public program be enabled to buy affordable coverage, either through their employers of through a ‘public sponsor.’ … The U.S. health care economy is inflationary. It is still dominated by fee-for-service payment of doctors and hospitals by third party intermediaries with open-ended sources of finances. There is no total budget set in advance within which providers must manage the care of their patients. For the most part, there is no incentives to find and use medical practices that produce the same health outcome at less cost.” (1/5/89 -  Enthoven and Kronick)
  • “A National Health Program for the United States: A Physicians’ Proposal. Our health care system is failing.  Tens of millions of people are uninsured, costs are skyrocketing, and the bureaucracy is expanding. We propose a national health program that would (1) fully cover everyone under a single, comprehensive public insurance program; (2) pay hospitals and nursing homes a total (global) annual amount to cover all operating expenses; (3) fund capital costs through separate appropriations; (4) pay for physicians’ services and ambulatory services in any of three ways: through fee-for-service payments with a simplified fee schedule and mandatory acceptance of the national health program payment as the total payment for a service or procedure (assignment), through global budgets for hospitals and clinics employing salaried physicians, or on a per capita basis (capitation).” (1/12/89 - Himmelstein and Woolhandler)
  • “Sounding Board: It Is Time for Universal Access, Not Universal Insurance. … Universal health insurance is not a good idea.  To control goods and services through a single agency - especially when the driving force is economic - would fly in the face of the American way of doing things. … Rather than support such unworkable, soulless programs, I propose universal access through a pluralistic funding mechanism. … So, we ought not to be talking about a universal health insurance scheme, but rather about universal access - access to needed care, on a timely basis, with controls on quality and use that have been accepted by everyone involved.  The key principle of effective access and limited cost is the rationalization of care.  In this age of high-technology medicine and miracle drugs, we must realize that we can no longer do everything for everybody just because it is possible. Rather, we should develop a system in which decisions about what we do, when, where, and to whom are based on reasonable expectations of the benefits involved and on sound medical principles communicated clearly to patients and their families.” (7/6/89 - James Todd, MD - American Medical Association)
  • “Special Report: The Pepper Commission Report on Comprehensive Health Care. A look at the outcome of the commission’s deliberations give a good indication of what, in fact, it takes to build political consensus. The commission basically face two separate tasks - reform of the nation’s existing system for insurance medical or health care, and creation of a system for insuring assistance in the task of daily living we call long-term care. The commission voted overwhelmingly (11 to 4) in favor of a major government initiative in long-term care. … By contrast, the commission’s vote on health care reforms - universal coverage for people under the age of 65 (at a cost of $24 billion) and measures to promote the efficient delivery of health care - passed by the slim margin of eight to seven. … The difference between the commission’s votes on long-term care and health care, then reflects the many and pointed political pressures that will work against consensus on health care reform, not for it. … First, and most obvious, the vast majority of commission members face reelection campaigns this fall… … Second, and related, in the wake of the traumatic repeal of Medicare catastrophic coverage, members will remain acutely sensitive to potential voter reaction to any particular reform package. Third, in health care there are entrenched political interests. … Fourth, with a complex issue such as this, consensus on the whole requires many, many concessions on individual provisions. … Finally, outright partisan politics will undermine consensus on health care reform, as the commission found in the days preceding the vote, when the White House placed intense pressure on some members to resist any consensus before the November elections. … If we do not act promptly, I believe our health care system may well implode by the end of the century.   The need for action is starkly clear.” (10/4/90 - Senator John D. Rockefeller IV, Chairman of the Pepper Commission)

And other articles from 1991 show similar perspectives on health reform and the urgency for action:

Washington Post, February 17, 1991 “Devising a Cure for High Costs of Health Care: Support Grows for Concept of National Medical Insurance. … The idea [of government-imposed universal health care that would provide quality coverage for everyone], in various forms, is gaining the support of groups ranging on the political spectrum from the AFL-CIO and the American Association of Retired Persons to the National Association of Manufacturers and the American Medical Association.  For the first time since the mid-1970s, supporters of national health insurance believe they have a legitimate chance of winning congressional approval for a universal health care bill, if not this Congress, then the next. ‘This is the best shot we’ve had in 15 years,’ said a key congressional aide. With health care costs climbing more than 20 percent a year for major corporations and even more for many small businesses, disparate political groups are beginning to form a coalition for reform.

USA Today, March 11, 1991 - “Health care costs more, serves fewer.  No other part of the US economy seems less understood than health care.  Few realize why health care costs are so stubbornly high ($2,700 per American per year) or why health care seems to defy free-market economics. … What a growing number of people are coming to know is dissatisfaction with a health care system that absorbs ever-soaring sums of money while letting more and more people fall through the cracks. …  Of all the cold showers of reality falling on the USA as the ’90s dawn, none is as chilling as this: The healthcare system in this country is in deep, deep trouble.”  (Graphic shows that of the 37 million people in the USA without health insurance 49% are working adults.)

Bottom Line - The more things don’t change the more they sound the same.

Next Up: Part 3 - Perspectives from a 1992 Medical School Class “The Crisis in the American Health Care System”

Posted in Access to Healthcare, Delivery of Healthcare, Economics & Financing, Health System Reform | 2 Comments »

Bending the Cost Curve: Trees and Forests

By Michael D. Miller MD
September 25th, 2009

Bending the curve of cost growth has been a expanding issue within health policy discussions – as opposed to the public plan option, which has increasingly been the focus of political health discussions. Recognizing how important cost growth is to health reform, the September/October issue of Health Affairs is dedicated to this topic, and it contains great articles describing various factors causing spending to grow faster than the GDP or general inflation, and some solutions to this ongoing conundrum.  However, these articles are like trees in the forest, i.e., they are very important, but a close examination of each one doesn’t provide a broad understanding of the whole forest - or in this case, what bending the curve of healthcare cost growth might look like.

Below are summaries of five of the Health Affairs articles - all are worth a close read.  And following that are some illustrations of what bending the curve could look like based upon current projections for healthcare costs, GDP, and inflation.

Trees Within the Forest - High Cost Growth Causes and Cures
Five very interesting articles that describe various aspects of the causes of and cures for health spending growth from the current issue of Health Affairs are:

  • Henry Aaron’s and Paul Ginsburg’s “Is Health Spending Excessive? If So, What Can We Do About It?” is a clear, concise and extremely useful article that would be a great read for students and policy-makers. Their article has two excellent tables. The first covers common questions (and answers) about health spending.  And the second describes the factors contributing to the growth in health spending, (arranged in into the groups of: Demand, Supply, Institutions, and Research), and notes whether policy changes to specific factors within these groups “can or should” reduce the growth in health care spending.
  • Arnold Milstein’s and Elizabeth Gilbertson’s “American Medical Home Runs” describes 4 primary care organizations that have successfully reduced costs without reducing quality. Examining these sites, they found the leaders driving changes had 4 elements in common: persistence, tolerance for risk, instinct for leverage on clinical and economic outcomes, and personal accountability.  (For those who have studied healthcare system and culture change, these elements shouldn’t be too surprising.)
  • John Toussaint’s “Writing the New Playbook for U.S. Health Care: Lessons from Wisconsin” describes the ThedaCare hospital system’s application of the Institute of Healthcare Improvement’s “lean manufacturing” principles, and how it led to dramatic reductions in waste and quality improvement - primarily by using team-based care to eliminate unnecessary steps in care delivery. His article notes that physician culture change was required for this transformation, and that their costs savings benefited payers - including Medicare - but the existing reimbursements system penalizes them for this, since it really creates incentives for waste by paying provider organizations more if they have higher care delivery costs due to wasteful actions.
  • Harold Miller’s “From Volume to Value: Better Ways to Pay for Health Care” is a great companion to Martha Bebinger’s article because it provides a conceptual description for what Massachusetts’ global payment proposal is attempting to achieve,  i.e. moving away from fee-for-service’s volume incentives to a payment system that rewards quality of care within an environment of fiscal responsibility. His Exhibit 1 illustrates how insurance risk can be separated from provider or performance risk – one of the concepts incorporated into Massachusetts’ global payment proposal. And his Exhibit 3 describes why there may be a role for continuing fee-for-service payment for certain types of low-cost, low-variability, high-social value services such as immunizations.  (Overall the mechanisms for implementing global payments reminded me of a book chapter I co-authored in 1995 about bonus pools and incentive payments for physicians, “Preparing for Managed Care and Capitation,” in Alliances: Strategies for Building Integrated Delivery Systems. What has changed in the last 15 years is that quality monitoring capabilities have matured so that relevant data can be captured and analyzed quickly enough to serve as a reasonable basis for making such bonus and incentive payments.)

Forest of Trees - What Bent Cost Curves Might Look Like
While these 5 articles - and the entire issue of Health Affairs - offer great insights into health spending growth in the US, they don’t provide a broad context for what health spending growth and bending the cost curve might look like.  Similarly, while the research and insights provided in the Health Affairs articles are important for health policy decision making, they may not be easily usable within the big-picture policy and political debate.  In other words, these articles are describing specific trees within the healthcare cost growth forest, and what most people need is a better understanding of the entire forest.

Henry Aaron’s and Paul Ginsburg’s article comes closest to painting this overarching view of the cost growth situation and its solutions, but I was somewhat surprised that nowhere in the issue is there a simple graphic showing projected healthcare cost growth and some scenarios for literally “bending the curve.”  Therefore, below are somewhat simple graphs depicting expected future spending growth and various scenarios for bending the curve of healthcare costs.

First, is a figure showing 8 different cost growth curves with the y-axis showing years
(Descriptions of each curve are below the figure)

Bending the Health Care Cost Curve Options - MDMiller-1

  1. Normal
    • 7% Growth Rate (7% was chosen as a flat rate based upon the National Health Expenditure projections, which vary from about 5-7% in the coming years, but are 7.2% for years 2017 and 2018.)
  2. Bent
    •  3% Growth Rate (3% was chosen as a flat rate for what might ideally be desired based upon projections for CPI-W of 2.8% and GDP growth of 4.6-4.9% for years 2011-18.)
  3. Invest to Bend
    • 7% Growth Rate until year 4, then 3%/year
    • 3% Investment Added in Years 1-4 (These investments would be expected to enable the healthcare system to operate at a 3% growth rate in later years.)
  4. Invest to Bend & Innovate
    • 7% Growth Rate until year 4, then, 3%/year
    • 3% Added Years 1-2, 2% in Years 3-4, and 1% added from year 5 onward (This curve is like #3, but the investment amount is reduced to 2% in years 3-4 and then continues at 1% in all subsequent years.)
  5. Cut & Pray
    • 7% growth rate
    • 5% cut first year (One-year cut that doesn’t change long term growth.)
  6. Keep Cutting & Praying
    • 7% growth rate
    • 5% cut 1st year and every 5th year (This is a variant of #5 in that expenditures are cut 5% every 5 years to reduce spending.)
  7. Invest, Then Cut
    • 7% Growth Rate until year 4, then 3%/year
    • 3% additional investment in years 1-4
    • 5% cut in years 6, 9, 12, 15, etc.
      (This is a combination of curves #3 and #6, but the 5% reductions are every 3 years rather than every 5 years.)
  8. Maintenance Investing and Cutting
    • 7% Growth Rate until year 4, then 3%/year
    • 3% additional investment in years 1 & 2
    • 2% additional investment in years 3 & 4
    • 1% additional investment each year after year 4
    • 5% cut in years 6, 9, 12, 15, etc.
      (This is a combination of curves #4 and #6, with a early year investments in system change leading to a 3% baseline growth rate – with an additional 1% added for innovation investment – and 5% cuts every 3 years to reduce waste.)

View of the Forest Depends on the Altitude
Time-frames are an important consideration for evaluating each possible curve.  For example, looking only at the first 9 years doesn’t show much difference from the 7% baseline growth rate for the various scenarios, except for immediately going to a 3% growth rate. (See figure below)

Bending the Health Care Cost Curve - MDMiller-2

However, removing some of the options and expanding the time-frame back to 16 years, shows that three options, (between the projected 7% baseline growth rate and the unrealistic immediate shift to 3%), can achieve dramatic savings. In particular, investing in early years to create a system that can both control cost growth and eliminate waste in the long-run, (Maintenance Investing and Cutting curve scenario), brings us to a cost growth rate that approaches what might have been achieved by immediately going to a 3% growth rate. (See figure below)

Bending the Health Care Cost Curve - MDMiller-3

Of course, the actual dollars spent is a factor of the area under the curve, so the “Maintenance Investing and Cutting” curve does represent more spending on healthcare than some other scenarios - depending upon the time-frame analyzed.  However, up-front investing in health system change has already happened. The Federal stimulus bill passed earlier this year included more than $30 Billion in healthcare system changing investments, which is more than 1% of total annual healthcare spending.*

Actually Bending the Cost Curve Requires Organizational and Culture Changes
The policy and practical challenges for bending the cost curve are choosing and implementing the options that will actually change clinical and reimbursement systems that can get us to the bent curve we want. In addition, convincing the public and millions of people employed in healthcare that these changes are productive and beneficial will also be a great challenge.  And meeting this challenge will require changing organizational cultures and operations, and individual attitudes and actions. Hopefully, graphs like this will help make the case that bending the curve is possible, practical, and palatable.

————–
* The American Recovery and Reinvestment Act of 2009 included $10 billion in increased funding for the NIH, $19 Billion for health information technology, $1.1 Billion for comparative effectiveness research, $500 million to train primary care clinicians, and $1 billion for several prevention and wellness programs - as well as $86 billion for expansion of Medicaid.

Posted in Delivery of Healthcare, Economics & Financing, Health System Reform | 1 Comment »

Encouraging Communications About Patients’ Goals

By Michael D. Miller MD
September 18th, 2009

I attended a great event yesterday where experts discussed how to improve healthcare quality and safety by increasing patients’ involvement in making healthcare decisions.

This seminar, “Patient-Centeredness and Patient Safety: How Are They Interconnected,” was organized by the Kenneth B. Schwartz Center and sponsored by the Massachusetts Medical Society and CRICO/RMF.  Don Berwick (President & CEO of the Institute for Healthcare Improvement) was the main speaker followed by a panel consisting of two patient safety leaders from local hospitals and a patient involved with promoting patient engagement in quality improvement.

To start the event, Dr. Berwick discussed how his thinking about healthcare quality had evolved over several decades, and his increasing belief in the importance of patient involvement. He discussed his Health Affairs article on Patient-Centered care, and summarized his current thinking about how to design patient-centered care in 8 bullets:

  1. Place the patient at the center
  2. Individualize
  3. Welcome family and loved ones
  4. Maximize health influences within care
  5. Maximize health influences outside of care
  6. Rely on sophisticated, disciplined evidence
  7. Use all relevant capabilities - waste nothing
  8. Connect helping influences with each other

Communications Is Crucial for Achieving Patient-Centerdness and Goal Sharing
The essence of the panel’s discussion was about how to improve communications among patients and their clinicians so that each others’ goals were shared and understood.  One example raised by a panelist was initiatives to prevent patients from falling in the hospital.  Patients may see nurses being in bathrooms with them as intrusive or uncomfortable, but discussing their shared goal of not having patients fall and hurt themselves shifts the context of the nurse’s action and enables it to be embraced by the patient rather than resisted.

From the patient’s perspective too often clinicians may have their own ideas about what the goals of the treatment should be, but without understanding the patient’s life interests and goals the two may be disconnected.  For example, clinicians often ask patients what they do for work to understand if the treatment or the outcomes will be compatible with their jobs, but often patient’s happiness or life fulfillment is related to something outside of work, such as playing the piano, playing with grandchildren, rollerblading, hiking with their dogs in the mountains, or hang-gliding.  Treating a patient’s injury or illness so they can do (or be able to try to do) those activities may be very different than what would be indicated if the goal was to enable them to work in an office.

Creating Policies to Promote Communications and Goal Sharing
Dr. Berwick’s presentation also included a brief discussion of how evidence based medicine (EBM) can improve patient safety by avoiding unnecessary care and setting realistic expectations about the outcomes for chosen treatments.  This is captured in his 6th bullet above. One of the challenges in the current push towards more EBM - and comparative effectiveness research (CER) - is what to actually measure in this research. Combining the health system’s desire for optimal outcomes with patient-centeredness, (i.e., his 2nd bullet - “Individualize”), could be achieved by including the patient’s goals for their treatment as one of the outcomes measured in EBM and CER programs.

Benefits of Measuring Achievement of Patients’ Goals as an “Outcome”
Process measures, (such as percentage of patients who’ve received a recommended treatment), are usually easier to evaluate, but are really proxies for clinical outcomes.  Actual outcomes like mortality or hospitalization can be harder to evaluate, in part because of individual patient differences and thus the raw data needs to be risk adjusted. However, measuring achievement of the patient’s goals could be very important and valuable to add to these evaluations - and could be a rough way to inherently risk adjust the data, i.e. the “goals” of treating a broken hip may be different for a 50 year old person than someone who is 70.  The actual measurement of such goal achievement could be done based upon answering the question of “how well were the patient’s goals met?”  Clearly this would have to be quantified in some way - and perhaps that could be done by the patients themselves on an 11 point scale from 0-100%.

Not only would measuring this “patient goal achievement” outcome add a useful dimension to some research, but it would also put the question of “what are the patient’s goals?” right at the front of the patient-clinician conversation.  And in the context of health reform and system improvement, by using the dictum of, “we manage what we measure,” measuring how well delivery systems and clinicians are achieving patients’ goals could be an important force for transforming care delivery.

Bottom Line for Patients and Clinicians
The next time you’re a patient talking to a clinician, be sure to talk about your goals for treating whatever ailment caused you to see that clinician.  And clinicians need to tell their patients what goals they expect to achieve from the treatment they’re recommending.  This is the start of a conversation since the patient’s expectations may not be realistic - such as for a patient with a severe fracture who wants to run a marathon in three weeks.  But by understanding each others goals and expectations they can agree on what should be done and how to proceed.

Need for Continuity of Care and Primary Care Clinicians
Of course some patients may seek to “doctor shop” looking for a clinician who will promise to achieve their goals.  This can be good if the first clinician isn’t attuned to the patient’s wishes, but it can also be bad if the patient’s expectations are unrealistic.  That is why having a trusted relationship with a primary care clinician can be so important, since their PCC can help them evaluate and digest other clinicians’ recommendations.  Again, it comes down to ongoing and two-way communications to understand goals and jointly develop treatment plans and decisions.

Posted in Clinician-Patient Relationships, Comparative Effectiveness, Delivery of Healthcare, Economics & Financing, Information & Communications, Quality of Care & Safety | No Comments »

Biotechs Biting the Dust

By Michael D. Miller MD
July 22nd, 2009

On Tuesday, Epix Pharmaceuticals announced that they were dissolving.  And unlike many innovative life sciences companies, they’re not being acquired by another company to take advantage of their research, nor are they evaporating because their one line of research failed in clinical development.  Rather, they’ve just run out of money, can’t raise any more, and their assets are worth less than their debt.  So they’re selling off what they can, and locking the door behind them.

While the company’s announcement isn’t too reveling about their history, looking at their information on Yahoo! Finance shows that while they have consistently lost money, (as do virtually all biotech companies without products to sell), year-over-year, revenue was increasing and the losses were shrinking.  And the company’s profile described various areas of clinical development:

“EPIX Pharmaceuticals, Inc., a biopharmaceutical company, engages in the discovery and development of therapeutics through the use of its proprietary silico drug discovery technology to treat diseases of the central nervous system and lung conditions. Its therapeutic product candidates in development include PRX-03140, which completed Phase II clinical trials for the treatment of Alzheimer’s disease; PRX-08066, a small-molecule inhibitor that completed Phase II clinical trials for the treatment of pulmonary arterial hypertension and pulmonary hypertension associated with chronic obstructive pulmonary disease; and PRX-07034, which completed Phase I studies for the treatment of cognitive impairment associated with schizophrenia. The company also offers Vasovist, an injectable intravascular contrast agent to provide enhanced imaging of the vascular system using magnetic resonance angiography. It has collaborations with SmithKline Beecham Corporation, Amgen Inc., and Cystic Fibrosis Foundation Therapeutics, Incorporated. The company was formerly known as EPIX Medical, Inc. and changed its name to EPIX Pharmaceuticals, Inc. in 2004. EPIX Pharmaceuticals, Inc. was founded in 1988 and is based in Lexington, Massachusetts.”

The Boston Globe also had an article about Epix’s demise, which also noted that Biopure, another Massachusetts life sciences company announced it was going under last week - however Biopure, which had been working on a blood substitute, was much more of a “one trick pony” than Epix.

Last fall I’d written about how biotech companies were treading water because of problems raising new money, and while several other smaller companies have been acquired, I don’t recall hearing about such a previous high profile company completely dissolving.  The ongoing challenge in the current economic quagmire will be for start-ups to find their initial funding, and to see if larger biotech and pharma companies can be enticed by science and economics to buy any of the remnant companies - although with the Merck/Schering-Plough and Pfizer/Wyeth pending combinations, those major players most likely won’t be in the market for new acquisitions anytime soon.

Posted in Economics & Financing, Innovation, Patents & IP | 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 | 4 Comments »

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