Accountability in Healthcare – What People Think of the Coming Changes

Posted on December 16, 2011 by Michael D. Miller MD

Following up on my pre-Thanksgiving post, I’m reporting back on what friends and relatives think about some of the terms for new healthcare delivery entities, e.g., Accountable Care Organizations (ACOs) and Patient-Centered Medical Homes (PCMH).

What I heard is consistent with my previous conversations: People think that ACOs are like HMOs, and Medical Homes might be nursing homes, home health, or hospice, etc. One great insight came from my cousin who is a teacher. She told me that teachers react negatively to the word “accountability” because of the No Child Left Behind (except those who don’t measure up) law – which according to a RAND analysis from the summer of 2010 is “encouraging teachers to focus on some students at the expense of others, and discouraging the development of higher-thinking and problem-solving skills.” (Yikes! That doesn’t sound good for long-term innovation, economic growth, and international competitiveness.)

Solutions for Engaging the Public with Healthcare Transformation

I’ve been talking to a variety of people involved with health transformation at the national and local level about this information/perception gap, and am looking for ideas for raising the public’s understanding about why more team-based and coordinated care will improve quality and efficiency for them as individual patients. If you have any thoughts on this, please feel free to comment. In addition, I’ll be talking to more friends and families during the remainder of the holiday season about their impressions of the new terms, (such as ACOs and PCMHs), as well as the benefits of the healthcare delivery changes that are on the horizon, e.g., why the iconic one-on-one relationship with a solo Dr. Welby-like primary care physician may not be the way to get the highest quality care.

Healthcare Turkey Talk

Posted on November 21, 2011 by Michael D. Miller MD

Thanksgiving is a great occasion for learning what people think about the future of the US healthcare system.* This year, I’m going to find out what people are thinking about some of the coming health delivery system changes – particularly Accountable Care Organizations (ACOs) and Patient-Centered Medical Homes (PCMH).

I’ve conducted this two-question informal survey with handfuls of people and found their level of knowledge and positive reactions equivalent to Congress’s approval rating, i.e. 9%. This is worrisome, since if transforming the US healthcare system to increase value and quality will be partially based on ACOs’ and PCMHs’ superior care coordinating abilities, it will be hard to improve cost, quality, and access at the local level if the average person/patient doesn’t know what these organization are, there is inherent aversion to their names, or there is resistant to unexplained “changes.” (For example, several people I’ve talked to have thought Accountable Care Organizations seem like HMOs, and Patient-Centered Medical Homes are home care, nursing homes or hospice.)

So fair readers of this blog, let me know what you hear at your Turkey dinners and associated holiday events – and I’ll post back next week what I heard from my disparate and decidedly unrestrained friends and relatives.

*Unlike most meals and gathering of family and friends, Thanksgiving dinner goes on for a long time, there are no ceremonial interludes, and it is generally a sit-down affair so you can’t move on to someone else – or out the door. This means “Aunt Sally” can pull your ear or kick your leg (either figuratively or literally) for upwards of 2 hours about what’s wrong with the US healthcare system and what how to fix it. My advice is to ask questions to find out root concerns and to gauge people’s understanding of the coming ACA changes in both healthcare delivery and insurance coverage. Also, if you find yourself referring to a recent study from Commonwealth or Kaiser Family Foundation, (or a similar organization or government group), STOP, put food in your mouth and nod encouragement for them to keep talking, because quoting the best studies to someone impassioned about their healthcare will be about as successful as convincing your 7-year-old cousin that 3.14159 is a great dessert.

Era of Accountable Care

Posted on October 24, 2011 by Michael D. Miller MD

For many months I’ve been talking about the array of health transformation initiatives the Department of Health and Human Services has been deploying as both demonstrations and programmatic changes. I’ve been characterizing this strategy to create more accountability as an evolving menu, buffet, or map – sort of like those magical Harry Potter maps where the lines keep appearing on the parchment to create a recognizable image.

As part of releasing the final rules for the Medicare Shared Savings Program, HHS also put forth a document subtitled “Menu of Options for Improving Care,” which is a list of some of the landmarks in the future map of an Era of Accountable Care. This document listed “options for healthcare providers of all sizes, types, all across the country” to work together to coordinate patient care, improve quality and lower costs. Besides the Medicare Shared Savings Program for Accountable Care Organizations (ACOs), these options include:

Partnership for Patients ($1B over 3 years)
Bundled Payments for Care Improvements (4 models proposed and 4 more planned)
Comprehensive Primary Care Initiative (Medicare partnering with Medicaid and private payers in 5-7 local markets to support primary care improvement)
FQHC Advanced Primary Care Practice Demonstration (with HRSA)
Advanced Payment Accountable Care Organization Model (pre-funding for physician groups wanting to form ACOs for the Shared Savings Program)
Pioneer Accountable Care Organization Model (demonstration program for advanced ACOs)
Financial Models to Support State Efforts to Integrate Care for Medicare-Medicaid Enrollees

The Menu document clearly indicates a coherent strategy for doing what the Medicare Payment Advisory Commission recently recommended: “Medicare payments should strongly encourage providers to move towards [ACOs, bundled payments, capitated models, shared savings programs] and make FFS less attractive.”

HSS’ Menu document is an initial description of the map HHS is drawing for providers about these more attractive options. In contrast, in all the debate about health reform and Medicare there has been very little discussion about the future of Fee-for-Service payments or how to make FFS more sustainable - except for the $300B budgetary hole and pending 30% fee reduction in Medicare’s physician payment system’s Sustainable Growth Rate formula. However, making “FFS less attractive” is certainly one of the transformational “sticks” Medicare has been wielding based upon provisions in the Accountable Care Act* and through other Medicare initiatives such as Value Based Purchasing, not paying for Never Events, and using Competitive Bidding for certain products and services. And the future will see more and expanded use of these types of initiatives to “make FFS less attractive.”

CMS Has Already Been Transformed

Another significant distinction between HHS’ current actions and what they have traditionally done is that HHS is not moving forward alone by modifying Medicare and Medicaid. Instead they are actively seeking to work in alignment – if not outright partnership – with private payers. This is clearly stated in the CPCI and the Multi-payer Advanced Primary Care Initiative, which has already started in 8 states.

I have previously written about Accountable Care, (and how it is fundamental for successful health reform), and with the unveiling of the menu from HHS I am encouraged that we are on the way to an Era of Accountable Care – because that is what people really want and society needs, i.e. Accountability for Clinical Outcomes and Accountability for Economic Results. It is only through those two avenues of accountability that we will achieve my version of the 3-Part Aim:

Saving Lives
Cutting Costs
Creating Jobs

Health Reform is Essential for Creating Jobs

“Creating Jobs” doesn’t usually appear in lists about the goals for health reform, but it is really a fundamental reason for fixing our fractured healthcare system: By reducing the financial bite healthcare is putting on families and companies – as well as creating security for access to health insurance for individuals – health reform will pour capital and confidence into the economy leading to the creation of jobs. That will be an era of healthcare that we can all count on.

——————————
* The given name for the health reform legislation is the “Patient Protection and Affordable Care Act,” and it is often referred to as the Affordable Care Act or the ACA. However, I believe the transformational components of the ACA are its features that will create accountability for the clinical and economic outcomes our healthcare system produces, and thus I call it the Accountable Care Act. In the context where others are referring to this law as Obamacare, or as a government take-over of the US healthcare system, or portrayed voluntary counseling as death panels, then I am very comfortable nick-naming the ACA the Accountable Care Act.

Health Reform’s Challenges – Some Things Don’t Change

Posted on October 6, 2011 by Michael D. Miller MD

A few years ago I was asked to write a Forward for a book about the transformation of healthcare in the US. I recently came across what I’d written about the rapidly changing US healthcare system and the challenges of controlling the growth in spending. I’m sharing it below (in the original Courier font) because what I’d written still is applicable for today’s situation, and particularly the summary sentence: “If today’s leaders — both health professionals and politicians — make wise decisions to support and foster integration of the delivery system and administrative standardization, while guaranteeing universal coverage, we will have a strong health system to support a strong nation.”

Forward

Health care in the United States is changing very rapidly. This seemingly obvious statement has taken many people by surprise despite the fact that the environment for health care has been evolving for decades. Both the actual delivery of health care and its financing are dramatically different today than when my father first started practicing medicine. I do not make this personal reference casually. Rather, I believe it is very important to remember that for everyone, illness, health, death and dying are among the most personal of issues within their lives and the lives of their family. I state this up-front because just as health is a very personal concern, health reform is an issue of people, personalities, and their relationships.

Just two decades ago, well after my father started practice, diagnostic testing was much more limited — MRIs were experimental, and fiberoptics were being introduced. Treatment options have similarly expanded with new procedures, (ambulatory surgery, fiberoptic surgery, and home IV), and new pharmaceuticals, (ACE inhibitors, antivirals, EPO, and new biologics), are standards of care. Similarly, reimbursement and financing of health care has also changed dramatically: Fee-for-service was predominant with payments made for submitted charges. Discounting and capitation were basically nonexistent for most physicians. Managed care was an unrecognized concept except in the form of care management by personal physicians prior to the explosion of specialists.

Clearly health care in 1993 is very different from health care in 1973 — for both patients and physicians. It is also very different for hospitals, insurance companies and businesses. To imagine in 1973 that General Motors would be spending more for health care than for steel in the 1990s would have been as inconceivable as imagining that AIDS would redirect the force of the 1960s sexual revolution into a social philosophy of safe sex. Situations such as these permeate American society, and have added many new moral and financial issues to the current round of reform debate.

Every time I talk with groups of professionals involved with providing or paying for health care — physicians, nurses, hospital administrators, business owners — I try to impart the perspective of rapid change and evolution to them. I have also tried to convey this to the policy makers with whom I have worked in Washington D.C., both in Congress and on President Clinton’s Health Reform Task Force. The key is to remember that dynamic change is always a constant process, and health reform — either market driven or legislatively directed — is definitely a continual process.

Some have argued that “health reform” will result in great losses for many Americans — losses of quality or choice or autonomy or benefits. Although guarantees are impossible to make in such a sweeping process, I strongly believe that in the end — perhaps after a rocky transition — the gains will greatly outweigh any downsides. This applies for everyone, not just for those who will gain the most, i.e. the uninsured or the underinsured. For example, increased organization and uniformity in our health care system will allow health care professionals to focus on delivering health care, maintain control of clinical decisions, and worry less about multitudes of benefit structures and paperwork mazes. Patients will benefit by having a rational system which provides guideposts to assure coordinated quality care rather than by default having to undertake their own care management because the disorganized system provides little or no assistance.

This evolution of health care delivery will be tightly linked to reforms of financing and risk assumption. Successful integrated health delivery systems will be able to accept the risk under a capitated payment system, but their ultimate success will depend upon providing their core “product,” i.e. health care services, and being able to document the quality of the care. The ability to coordinate these two functions will require a tight working relationship between the system’s administrative management and the systems “product” managers, i.e. physicians and other health care providers.

In thinking about how to achieve success in health reform, the relationships between individuals is extremely important to remember, and surprisingly easy to forget. It must be recognized and remembered that health reform is a people issue. Not only does it involve people’s basic needs, but it is a service provided by people for people. And at its most basic level, the process of reform is a people puzzle, not a technological one. This is clearly seen in the personal relationships and negotiations which encompass the politics of health reform.

Even more striking is the people-centered nature of health reform in the marketplace. Ultimately putting together a reformed health care delivery system requires the building of new relationships between organizations, i.e., hospitals, groups of physicians, and other providers. However, these relationships are ultimately personal ones, involving the individual physicians, other caregivers, and the managers of the larger entities. These relationships are not easy to build, but recognizing their necessity as a foundation for system development is the first step in the process.

Thus, reform initiatives — both local and national — in the coming years will likely be characterized by the saying “Market Driven & Medically Directed,” because the marketplace will force integration to proceed, but the shape and control of the resulting integrated systems will be directed by health care professionals — predominantly physicians.

The chapters of this book provide perspectives, information and guidance for health care reform leaders on how to think about health care delivery as a local and a regional phenomenon — an outlook often missing from national debates. The overriding conclusion is that through appropriate integration and alliance building, health care can be improved and costs contained.

This volume focuses on: 1) the market forces driving the current evolutionary process in health care, 2) the resulting niches which health organizations are being forced to fill, and 3) how they are responding in order to successfully fill these new niches. Overall, the volume describes how health care professionals can think and prepare for the coming decades as our health system evolves from one marked by disorganization and multiplicity to one of more integration and uniformity.

The issues discussed in this book are not the final word in health reform. In fact, if market driven health reforms are the only changes seen in this country, it will be a road to disaster. One of the major downsides of solely market driven reform is that through integration and the alliances formed by health providers, businesses and insurers are able to reduce cost shifting within the system which has been used to support uncompensated and charity care. This reduction of a hidden tax would benefit businesses, but carried to its extreme could also lead to a situation where the uninsured truly will be without access to any health care because those who can pay will no longer be subsidizing those who cannot. This will cost our businesses and the nation more in the long run both financially and morally.

In the end it will be the actions and decisions of front line health care decision makers which will determine the strength of the health care system the U.S. will carry into the 21st century. If today’s leaders — both health professionals and politicians — make wise decisions to support and foster integration of the delivery system and administrative standardization, while guaranteeing universal coverage, we will have a strong health system to support a strong nation. Less fortunate alternatives will leave us weakened both financially and morally. Although I do not believe in utopian scenarios, I do believe that progress will be made, and problems addressed in a positive and significant manner. It is clear that the marketplace participants — health professionals and their organizations, being driven by businesses — are following through on their end of this equation. It remains to be seen how well the political leaders of our country follow through on their end of this balance.

Michael D. Miller, M.D.
November, 1993
Washington, D.C.

18 years later it is clear that the issues and solutions haven’t changed significantly: Cost containment, quality improvement and expanding access were (and are) the goals, and the solutions involve creating “a rational system which provides guideposts to assure coordinated quality care rather than by default [patients] having to undertake their own care management because the disorganized system provides little or no assistance.”

2011 is clearly as different from 1993 as 1993 was from 1975. One of the biggest difference is that political leaders have finally followed through by passing significant legislation – which didn’t happen in 1994. Another significant change is the ability of information systems to acquire, analyze, and distribute data and comprehensible/actionable information to clinicians, payers, providers, and patients.

While we’re making progress, it won’t come unaided and unguided. The pieces necessary for making dramatic improvements are being put into place from a variety of sources, including legislation (e.g., HITECH and PPACA), other government actions (e.g. Medical Home and innovative payment demonstrations), non-profits (e.g., RWJ Foundation’s AF4Q and Care About Your Care), and initiatives from companies (e.g., Prometheus, Leapfrog, and redesigning health benefits). The challenge now is for businesses, providers, payers, clinicians, regulators, legislators, and patients (or at least their advocacy organizations) to follow through and turn those pieces into a coherent and integrated system – or really connected and coordinated systems – that provides greater value and more accountability for both clinical and economic outcomes.

Selling Healthcare Changes – Loss Aversion & Adoption of Innovations

Posted on September 26, 2011 by Michael D. Miller MD

Healthcare issues ranging from national health reform to stem cell research have become a major force in political rhetoric – often overwhelming substantive information. This creates challenges for individuals and organizations seeking to achieve positive changes as their communications are swamped by election-driven messaging.

Creating and implementing successful communications programs in this turbulent environment is easier when the principles of “loss aversion” and the factors affecting the adoption of innovations are used constructively.

Loss Aversion & Campaign Messages: Swinging Votes Not Actions
Campaign communications – particularly negative messages – are very effective because they use loss aversion principles to leverage people’s reluctance to embrace change.

I have repeatedly heard that people need to believe they will receive a gain that is twice as large as their potential loss before seeking to make a change. However, that 2:1 ratio is derived from some specific social psychology experiments, while loss aversion research demonstrates that the ratio varies depending upon the magnitudes of the risks and rewards for the individual. For example, many people would willingly wager 10 cents on a coin flip if they could win 11 cents by guessing correctly – if nothing else just for the “fun” of playing, and because losing 10 cents isn’t a big deal. However, very few people would wager $1,000,000 on the same coin flip for the chance to win $1,100,000 – even though the odds and the loss-gain ratio are the same, (and in the player’s favor), because the significance of the risk is much greater.

Source: Kahneman et. al. 1991

While these principles are not unique to healthcare, their power for influencing people’s perceptions and actions is greater for healthcare issues because of healthcare’s very personal nature and most people’s impression that they have some healthcare expertise acquired through first-hand experience. [Reader Participation: Insert your story here about a friend or relative who has "educated" or "advised" you with a personal healthcare story, or how someone - perhaps a stranger - has offered healthcare advice based upon something that happened to them, or someone they knew, or they just heard about from someone else.]

The principles of loss aversion make it very, very difficult for potential short-term and individual gains to be the foundation for effective communications campaigns about healthcare improvements for the following reasons:

Loss aversion means that most people are going to want to see a potential gain that is a multiple of the potential loss – and those most affected by a proposed change will see the potential loss as much more significant, and thus require an even larger potential gain in order for them to not oppose it. (And those most affected will also be the most active and vocal in their opposition.)
For most people, healthcare changes have significant levels of perceived personal risk – whether it’s changing their health insurance benefits, choice of physicians or hospitals, how they can obtain access to new or experimental treatments, or even very specific changes such as stem cell research, abortions, end-of-life counseling, genetic or autism screening, etc.
While potential losses are well understood by most people – since they know what they currently have and realize that change will be “something different” – potential gains are usually much harder to visualize and believe in. (This is why the current Administration has said that under the new health reform law people can keep their current health insurance plans if they like them.)
People’s trust in government and large organizations, (e.g. corporations), has plummeted in recent years, greatly reducing people’s confidence that changes advocated by these sources will actually produce the promised gains. Specifically, in “calculating” potential losses and gains most people will greatly discount potential gains from government or corporate initiatives. For example, suppose a proposed government healthcare change is described as having a gain of 10 and a potential risk of 3. [These numbers are obviously only arbitrary representations of the magnitude of how potential changes might be valued.] This change might be seen as having a gain-risk ratio of 10:3, but a general distrust of government actions could discount the potential gain to 25%, (which is about where Congress’ approval rating is right now), resulting in a perceived gain-risk ratio of only 2.5:3 – and this assumes that people don’t inflate the potential losses because of their low opinion of government, which could make the perceived ratio 2.5:6 or 2.5:9. Clearly this is not a situation where people would eagerly support a change in something as important as their health.

This means that even for a proposed change where the best projections indicate significant benefits to many, many people, any individual or organization who opposes the change, (for political or other reasons), has a very easy time crafting messages and images that are very effective in undermining support for the proposed change. (For example, the combination of the following phrases has been effective in undermining support for the new health reform law: “Government Takeover,” “Death Panels,” “Unconstitutional,” and “You Lie.”)

Overcoming Loss Aversion and Negative/Counter Messaging
The solution to overcoming such undermining messages that play on people’s concerns about losing what they have (and know) – as well as their mistrust of governments and other large organizations – is to present proposed changes in ways that expand people’s confidence in and understanding of the potential gains, while also minimizing the perceived loss potential. One way to do this effectively in a communications strategy is to address the 5 factors influencing the adoption of innovations that Rodgers first described in the 1960s:

Relative Advantage
Compatibility
Simplicity
Observability
Trialability
[These are derived from Rogers 2003 book and it's earlier editions, and described by Dealy and Thomas in their 2006 book.]

Selling Health Reform as Positive Innovation
Shifting to a “selling” campaign that incorporates these factors – while minimizing the potential affects of loss aversion – moves the communications dynamic away from the slippery losing slope of loss aversion’s context to one that is more favorable to thinking about the longer-term and more tangible benefits of the proposed changes. For example, the broad communications campaign for the bipartisanlly supported Medicare prescription drug benefit, (Part D - enacted in late 2003, benefits started in 2006), emphasized how much individuals would save, rather than the long-term value and security of having insurance – which is what Part D plans are, they are insurance, not a discounted purchasing scheme. (A USA Today article stated that an average person who enrolled in a Medicare Part D plan would save $1,100 in 2006.)

The Result: While people who did purchase Part D plans were generally happy with their plans, about 10% of Medicare beneficiaries (~4.5 million people) didn’t have prescription drug coverage in 2007 despite some plans costing less than $10 per month. The large number of people who decided to not purchase this very low cost insurance is even more striking because individuals’ premiums increase by a “penalty” of 1% per month for every month between their initial period of eligibility and their enrollment date. (This penalty is to reduce adverse selection, which occurs when people wait until they are ill before getting insurance.) Unfortunately, the number of Medicare beneficiaries without drug coverage doesn’t appear to be declining – in 2010 it was still about 10% of beneficiaries, and this compares very poorly to the very low percentage of people who declined Medicare Part B coverage.

The significant number of Medicare beneficiaries who decided not to purchase a Part D plan could be due to their aversion to a perceived loss being stronger than the positive messages used to sell the benefits of the plans. This imbalance results from the gains being presented as short-term financial savings, (rather than the long-term benefits of having insurance), and thus didn’t utilize the factors for improving the adoption of innovations, i.e., Part D insurance plans is comparable to other insurance they have, it is not complicated (except for the initial large number of choices), they can observe it, the plans can be tried, and the insurance provides a significant relative long-term advantage.

Bottom Line – Sell the Value & Spirit, Not the Calculation
The bottom line is that selling the value of healthcare changes – whether it’s national reform or narrow innovations – needs to encompass broader, longer-term, and tangible values, rather than short-term calculations that may be both uncertain and not believed, while also deflecting and undermining opposing arguments, i.e. capitalize on the factors that ease the adoption of innovations while minimizing people’s inherent aversion to potential losses.

And in closing, (at least for this posting), how these principles were used in a negative way to sell a non-healthcare change might be a useful illustration:

Buying a house with an unaffordable mortgage was seen as OK before 2008 because the potential for loss was believed to be very small – since prices were rising and foreclosures were rare so there was very little to trigger an aversion. And owning a home is compatible with most people’s desires and daily lives, home ownership is observable, renting is akin to a trial of ownership, brokers and agents made it all very simple, and home ownership has potentially great financial and social advantages. However, in retrospect it’s clear that purchasing a home was vastly wrong for many people – and potentially involved outright fraudulent communications – because they had been led to believe in illusory loss-gain (a.k.a. risk-benefit) calculations.

Patient-Centered Care? Or Not?

Posted on July 11, 2011 by Michael D. Miller MD

The term “patient-centered care” has increasingly been used to describe healthcare structures that deliver better quality care – as well as often doing so with lower costs. And today there was a news story about how some medical schools are assessing applicants’ interpersonal skills, something that is fundamental for being a patient-centric clinician.

While there are have been numerous articles demonstrating the value of patient-centered care and concluding that it is better and should be promoted – including those looking at the ill named “Patient-Centered Medical Homes” – I’ve found myself pondering the following questions:

“What type of care have clinicians been providing if it hasn’t been patient-centered? Has it been clinician/physician centered? Or revenue centered? Or just intentionally confusing and impersonal care designed to stymie the adoption of evidence based standards of care?”

“And along those lines, is the widespread delivery of non-patient-centered care the reason why the IOM concluded that it takes about 17 years for valuable healthcare information to be adopted into clinical practice? Or why Atul Gawande found that hospitals in other countries have widely adopted surgical checklists to reduce medical errors and adverse outcomes, while only 25% of US hospitals are using these checklists?”

I’m just asking….

Cultivating Health Reform and Transformation

Posted on July 5, 2011 by Michael D. Miller MD

Listening to various speakers at a two-day HIT/Delivery System Transformation Summit last week reinforced my thinking about the concept that reforming (or transforming) the US healthcare system is more like farming than business management.

Transforming healthcare is like farming because it involves cultivating collaborations and coordination among independent people, organizations, and stakeholders who all have varied interests and reporting/governance structures. In this way, “managing” or “leading” health transformation is like growing plants – the soil needs to be prepared, the plants (or seeds) need to be planted, and then they need to be watered, fertilized, weeded, pruned, etc…. And depending on the plant, (i.e. what crop you expect to harvest), the time-frame from planting to results can be weeks, months, or years. This is just like changing healthcare, where seeing the fruits of the labor/investment can take months, (e.g., for new practice guidelines like checklists), to years for some healthcare IT systems. [Note: These time-frames are for seeing value from the change, not the time required to develop the technology or the evidence to demonstrate the value of the changes - which generally takes many years.]

Cultivating successful health transformation also takes coaches, change agents, and data – all of which are used to promote change among independent individuals and organizations by creating and reinforcing internal and external aligned interests and visions. Of course successful alignment leaders are also responsible for cultivating the development the appropriate deployment of these coaches and change agents, as well as the data capabilities and learnings.

This type of cultivation (versus “management”) is something I’ve done in various roles – most recently in an initiative that has brought together the leading stakeholders in a mid-sized city to improve the quality and value of healthcare for the entire region. (My title has been “Project Manager” – Perhaps I should change it to “Project Agronomist.”) In other situations I’ve been more directly responsible for people and projects in matrixed organizations and with virtual teams. But even when working inside one organization, creating shared vision and engagement requires cultivating every individual in different ways – just as every crop has different soil, water, light and nutrient needs. And from observing other people’s mismanagement adventures, I’ve seen how applying traditional management practices to this type of situation can be like tilling a wheat field with a rolling pin, i.e. a rolling pin is effective for wheat, but only when it has been grown, harvested and milled into flour and made into dough.

But back to the HIT/Delivery Transformation Summit. In talk after talk, people from across the country noted the challenges they face in getting their data systems to work together as well as aligning different stakeholders. But while many of the speakers noted the greater than expected technical difficulties in integrating data systems and sources to create information pictures robust enough to guide future efforts, (and inform clinicians and hospitals about their performance), the leadership, coaching and interpersonal “cultivating” challenges were equally (or more) challenging.

The bottom line is that advancing healthcare IT, implementing health system changes, and creating successful broader transformation requires careful cultivation of many different crops of stakeholders who all need to be smelling the same flowers for them to achieve their common desired goals of improving healthcare quality and efficiency, i.e. so they can have their cake and eat it too.

Creating and Implementing Healthcare Innovation – BioPharmaceuticals, Delivery System and Reimbursements

Posted on March 22, 2011 by Michael D. Miller MD

Healthcare innovation is an extremely hot topic right now, ranging from the new Center for Medicare and Medicaid Innovation, FDA’s approach to approving therapies and devices, an entire issue of Health Affairs, and of course patient-centered medical homes and Accountable Care Organizations [Patient-centered medical homes are also known as Advanced Primary Care Model practices, and ACOs are a combination of delivery and reimbursement innovations.]

I’ve been working for many years to create value for patients and society by speeding adoption of these types of innovations by clinicians, other providers, patients, payers, regulators, communities, etc., and have found that healthcare innovations have at least three things in common:

Healthcare innovations occur in steps, with each advance building on the shoulders of what came before
These stepwise advances also produce indirect benefits that can be greater than the innovation’s direct effects
Adoption of innovations doesn’t just “happen.” Strategic planning can improve the speed and breadth of adoption – leading to greater value for patients and society

1. Axes of Innovation – Primary, Secondary and Tertiary Benefits
Every healthcare innovation can have multiple benefits to patients and society – often for different conditions. I call this cascade of different benefits UP, OVER, and OUT Innovations. (The text and diagrams below illustrate this biopharmacueticals.)

UP Innovation: UP Innovations occurs when subsequent medicines in a class, (e.g. Beta Blockers for high blood pressure), have characteristics, (such as once-a-day dosing, and less side-effects or drug-drug interactions), that permits more patients to use the medicine correctly, and thus produce better outcomes.

OVER Innovation: OVER Innovations occur when medicines are discovered that treat the same disease through different mechanisms of action, such as Beta Blockers and ACE Inhibitors to treat high blood pressure.

OVER Innovation also occurs across industries and platforms when devices and other therapies are developed that compete with biopharmaceuticals – and vice versa. This occurred for erectile dysfunction (ED), when devices, (both the vacuum pump made famous by Austin Powers and implanted prosthetics), and an injectable medicine, presented different treatment options. These therapies all had certain characteristics that caused patients to not use them very widely – which provided the clinical opportunity for the oral medicine sildenafil (Viagra®) – and then the other subsequent UP Innovators in the PDE5 Inhibitor class of pills.

OUT Innovation: OUT Innovation involves the use of an existing therapy for completely new diseases or conditions. Sildenafil to treat early-stage pulmonary arterial hypertension is an example of this type of innovation. (You didn’t think I used Viagra® in the previous example just to be salacious did you?). Similarly, many medicines to treat cancer were originally approved for a specific type of tumor and then used for other cancers, or even for non-malignant conditions. (Oncology and immune disorders such as rheumatoid arthritis are also clinical areas where small molecules and biologics compete as UP and OVER Innovations.)

2. Innovations Enable Many Types of Benefits
Another way to view the benefits innovations have for patients and society is to examine how the adoption of an innovation produces indirect changes in care delivery and reimbursements – some of which can be more significant than the innovation’s original change:

New treatments can change how care is delivered, e.g., stents, (originally developed for urology), expanded the treatment options for clogged heart arteries from surgery to include outpatient invasive radiology procedures.
Payment systems for specific illnesses have influenced the development of therapeutic options and care delivery infrastructure, e.g. low reimbursements for chemical dependency present barriers to R&D in that area, while high profit opportunities for cardiac rehab and obstetrics have prompted health systems to build new facilities for those conditions.

Health information technology (HIT) is a great example of a class of innovations with broad enabling effects. At a fundamental level, having clinical information in electronic forms improves the efficiency of storage and transmission, and thus reduces the time (and costs) for copying, billing and looking for records, as well as minimizing the need for repeat tests etc. (This was one of the benefits of HIT that President Obama cited in a State of the Union address.) However, the value of electronic medical records (EMRs) and related HIT applications for patients and society is even greater than these direct benefits because it enables activities such as:

Tracking mechanisms to make sure patients are receiving recommended treatments and preventions
Automatic checking for drug-drug interactions and patient allergies
Easy access to recommended diagnostic and therapeutic protocols based upon the individual patient’s condition
Systems to evaluate the overall progress of physicians and practices in meeting recommended standards of care, such as A1C levels and blood pressure for people with diabetes. (See here for an example of a web-site reporting this type of information.)
Research across a community to identify trends in care patterns and illnesses to better allocate resources for quality improvement and public health initiatives.

Furthermore, advanced HIT applications can enable overall healthcare integration and care coordination via care teams – which leads to better care for individual patients and more rapid adoption of evidence-based practices that improve quality and efficiency. These effects are particularly evident with telemedicine, which can literally force different clinicians and caregivers to work together as a team because they are connected via a sharing technology that clearly demarcates their roles, i.e. monitor/manager and actual deliverers of care. (The draft report Telemedicine’s use in Intensive Care Units describes an example of this in more detail.)

Payment Innovation Enables Quality Improvement
Another example of how one innovation can produce significant secondary benefits is payment innovation’s potential to turbo-charge quality improvement programs: The fee-for-service payment system in the United States often penalizes clinicians and health delivery systems for providing the best quality care. For example, if a hospital/health system provides coordinators (such as social workers) to patients being discharged from the hospital or emergency room to make sure they get proper follow-up care, they are less likely to “bounce back” to the ER or hospital. (This is good quality coordinated care.) However, in many cases the hospital or health system doesn’t get paid for those follow-up outpatient services, and by preventing repeat inpatient and ER visits it also loses potential revenues.

Payment innovations – if properly structured and implemented – can reverse these types of incentives and lead to less overall spending, as well as broader and more rapid adoption of quality improving practices. Such payment innovations could involve bundling reimbursements around an episode of care, (or treatment of a condition for a month or year), or across broader care teams such as the hospital, outpatient physicians, home health and rehabilitation. And, just to come full-circle, by creating the capabilities for monitoring quality and spending, HIT systems enable accountability of health systems, providers and clinicians – as well as payers, patients, and public health officials. That is, such monitoring can ensure that the care delivered in response to the payment innovations are quality and efficiency based, and don’t lead to rationing and budget cuts disconnected from overall costs or quality.

3. Change Adoption – Faster, Sooner, Better
A third important aspect of innovation is that it needs to be adopted in order to produce value. (Duh.) While there has been a lot written about adoption of innovation, it is particularly challenging in the healthcare environment where the “product” is a service delivered very directly (and often intimately) from person-to-person. That is, healthcare is largely a service industry, and thus getting clinicians and patients to adopt an innovation is much more complicated than convincing people to purchase the latest tablet computer, or even to use self-scanners at grocery and drug stores.

Below is a simple graph illustrating the importance of strategies and steps to promote the adoption of innovation in healthcare. The two diverging lines shows why planning for and investing in change adoption are very important for actually changing clinician and patient behaviors.

The specific strategy illustrated in this figure involves creating and supporting champions for the innovation. These “change agents” are people who can connect to the targeted users and demonstrate the value of the innovation in a real-world way. The two curves in the diagram show the difference between the adoption of innovations when they are just released into the wilds of the healthcare system, (lower line), and when they are actively promoted with an adoption strategy. Specifically, the adoption of an innovation would proceed without these champions for change from point 0 to A1, B1 and C1, etc. But with champions, the path can proceed along the upper line from point 0 to A2, B2, and C2, etc. (The value of investing in the champions and change adoption strategies can be calculated by the vertical distance between the points A1 and A2, B1 and B2, etc.)

Value to Whom
How the value of an innovation is demonstrated to potential adopters depends upon the specific innovation, but generally it requires the champion presenting the information to be a peer-leader, to communicate the relevance of the innovation to the individual, and to demonstrate how the innovation will create a better situation for the individual adopting it.

This last point is crucial for adoption of healthcare innovations – such as the post-discharge care coordinators mentioned above – because many innovations may benefit patients or society, but to the individual adopting the innovation the costs would be greater than the benefits. This is what I call the “Value to Whom?” analysis since it highlights that an ROI calculation about an innovation that aggregates the costs and benefits for all stakeholder may be misleading if the costs are borne mostly by one stakeholder while the benefits are received mostly by another, i.e. their is a value mismatch across stakeholders.

Similarly, many innovations will present differential benefits (and ROIs) for different types of patients based on their clinical states. For example, while the team-based care embodied in patient-centered medical homes is good for all patients, it clearly should be of the greatest benefits to people with the most complicated and chronic conditions.

SUMMARY – The Healthcare System’s Bones are Connected Like a Skeleton (or Gears in a Machine)

Innovations Build on Each Other: Innovations are developed based upon new knowledge, they build upon the existing “standard of care.” But the adoption of innovative treatments, delivery methods, and payment models is not a unwavering process. Rather, the breadth and depth of adoption is greatly influenced by factors intrinsic to the innovation, the clinical/economic environment in which is will be adopted, and how effectively it is presented to those who need to adopt it, i.e. clinicians, patients, payers, regulators, etc…..
Innovations Need to Fit Into the Existing System In Order to Change It: Innovations don’t occur in isolation. Innovations are adopted into highly connected healthcare delivery and financing systems.

Innovations Have Many Connected Benefits: Important innovations not only have direct benefits, but also create changes in the fundamental delivery of care – both by individual clinicians and within the overall structure of the healthcare delivery system. HIT and payment innovations can produce of these types of “game changing” benefits.
Adoption of Innovations are Connected to Reimbursements: The adoption curves for innovations are tied to financial incentives. This is part of the “Value to Whom” reality. Therefore, reimbursement amounts and policies can create incentives or barriers to the development and adoption of innovations – and thus greatly influence the benefits patients and society eventually derive from any innovation.
Innovations are Necessary for Progress: Without innovations – and without the adoption of innovations – healthcare delivery will not improve, and progress towards better quality care and lowered costs, (a.k.a. bending the cost curve), will be very slow and overwhelmed by the wave of Baby Boomers soon to hit our healthcare systems.

Medical Homes (PCMH) in 2011 – Patient and Consumer Centric

Posted on February 23, 2011 by Michael D. Miller MD

Patient-Centered Medical Homes (PCMH) are continuing to be a bigger and broader part of the real-world discussions about health reform and transformation in the US. According to the the National Committee for Quality Assurance (NCQA) at the end of 2010 there were 7,676 clinicians in 1,506 recognized PCMH practices in the US. This information was released last week by NCQA with their updated 2011 PCMH Standards.

Another marker of medical homes’ increasing pervasiveness is the blurb – “Home sweet medical home” – in the March 2011 issue of Consumer Reports magazine that starts with, “If you haven’t already heard the term ‘patient-centered medical home,’ chances are you will soon.”

Consumer Reports – “Home Sweet Medical Home”
The Consumer Reports blurb is part of an article about what primary care physicians wish their patients knew. Interestingly this longish blurb notes that any practice can be more patient-centric without being officially certified, and it lists the important features patients should look for:

Can you get an urgent appointment within 24 hours?
Can you reach somebody in the practice by phone at night or on weekends?
Can you get test results quickly via e-mail or telephone, or on-line?
If you have a chronic condition, is there a system for tracking how you’re doing?
Does the practice include non-MD staff members such as nutritionists or nurse practitioners to help you manage your medications or chronic conditions?
Does your primary-care doctor keep track of your treatment by specialists?

NCQA’s 2011 PCMH Recognition Standards, Elements, and Factors
The 2011 PCMH Standards NCQA released last week are much more detailed about what a primary care practice should look like to provide high quality primary care – and they are a logical evolution from their 2008 Standards. Specifically they:

Reduce the number of Standards from 9 to 6 – which should make them easier to understand and implement.
- The 6 Standards have multiple Elements. And each Element has various Factors that contribute to the scoring for that Element.
Integrate newer health IT standards and requirements.
- NCQA provides a cross-walk between the Elements and the corresponding Federal Meaningful Use requirements for health IT that enable clinicians to receive higher Medicare and Medicaid reimbursements.
Include a patient survey, which will be available in 2012.
- The optional survey will provide more patient-centric feedback about people’s experiences and enable practices to score extra points towards the recognition Tiers.

NCQA also continues to have three Tiers of possible recognition – with Tier 3 being the highest.The new NCQA standards also continue to have “Must-Pass” Elements (in bold/italics below) for the 6 Standards. And practices must score at at least 50% on all those Elements to receive any recognition Tier.

Standard 1: Enhance Access and Continuity
Access During Office Hours, e.g., same day appointments and telephone or email communications

Standard 2: Identify and Manage Patient Populations
Use Data for Population Management, e.g., using medical record data to remind patients about getting evidence-based care for specific preventive services and treatments for chronic conditions

Standard 3: Plan and Manage Care
Care Management, e.g., individually written care plans and addressing barriers to patients achieving their treatment goals

Standard 4: Provide Self-Care and Community Support
Support Self-Care Process, e.g., providing educational resources and tools to enable patients to improve their self-care and healthy lifestyles/behaviors

Standard 5: Track and Coordinate Care
Referral Tracking and Follow-Up, e.g., coordinating and following-up on referrals to specialists, including testing done by specialists and their recommended treatments

Standard 6: Measure and Improve Performance
Implement Continuous Quality Improvement, e.g., setting goals and acting to improve care for patients with chronic conditions, (such as diabetes, heart disease and depression), and preventive services, (such as immunizations, and cancer and osteoporosis screening)

It is also worth noting that among the various Factors that make up the Elements, NCQA designate some as “Critical Factors,” i.e., they are required for any scoring on that Element. And two of these Critical Factors are for Must-Pass Elements:

“Providing same-day appointments”
“Develops and documents self-management plans and goals in collaboration with at least 50% of patients/families”

Thus, to achieve any level of recognition as a PCMH from NCQA, practices must have these two capabilities.

Conclusions:
While it may be coincidental that Consumer Reports lists 6 criteria for patients to consider in evaluating primary care practices for their “medical homeness,” and NCQA has 6 Must-Pass Elements, the two lists do parallel each other.

NCQA and Consumer Reports are targeting different groups of stakeholders – which is appropriate. NCQA’s requirements enable practices and providers to become recognized, while also informing payers and regulators so they can determine how to utilize a practice’s recognition in their policies and practices – including reimbursement levels.

Similarly, Consumer Reports is seeking to educate consumers, (a.k.a. patients and families). What is reassuring is that Consumers Reports doesn’t try to compare medical homes or clinics using its normal format of tables of numbers and those great red and black circle symbols. That type of evaluation works well for commodities like TVs, but medical care is a process not a product, and it needs to be individualized for the patient – so what is a good medical home for one person may not be as appropriate for another. (Atul Gawande’s recent New Yorker article “Hot Spotter” includes some examples of how cultural appropriateness can be a determining factor for the success of care for severely ill people.)

NCQA’s standards focus on structures and processes, and thus are not the beginning and end of what is needed for a successful patient-centered medical home. But certainly rigorous structural and process standards, combined with consumer education – along with other contributing drivers like cultural change motivators and incentives for achieving better outcomes – should lead to better quality, value, and efficiency in our health care system.

Let me know what you think about Medical Homes.

[Full Disclosure: I was given the Consumer Reports magazine by a friend who bought it because it has an article about TVs - and now I have to help her go buy a TV.]

Fundamentals of Health Reform and Transformation

Posted on February 5, 2011 by Michael D. Miller MD

Trying to follow what’s being written about implementing health reform has been like trying to drink a waterfall. Having followed these issues for many years I’ve gleaned some fundamental aspects about many of the ideas and recommendations that simplifies how to approach this flood – including how to evaluate ideas and proposals like Patient-Centered Medical Homes (PCMH), Accountable Care Organizations (ACO), Shared Savings, Health Information Exchanges (HIE), Pay-4-Performance (P4P), etc…

Structure v. Reimbursement Systems/Arrangements
First, discussions and descriptions that don’t affirmatively recognize the distinction between Structures and Reimbursement Systems can create significant confusion. For example, the requirements for a PCMH to be recognized by the National Commission for Quality Assurance are structural, but how they are reimbursed will strongly influence how successful such practices are for improving quality of care and controlling costs.

Similarly, at one level ACOs are structures for organizing care – albeit to assume some level of financial risk. But their reimbursement systems and arrangements (both external and internal) will be tremendously important for their clinical and financial success. For example, the health reform law has a “Shared Saving Program” for Medicare and ACOs, but it specifically state that Medicare can reimburse ACOs under three different options:

A shared savings arrangement (essentially a one-sided risk situation where the ACO can get savings but isn’t at risk if costs are higher than projected)
Partial capitation (i.e., some two-sided risk)
And, any other type of arrangement that the Secretary of HHS thinks makes sense.

Until the proposed recommendations for this part of the health reform law come out, (and they are expected very soon), it is mostly speculation as to what each of those three options might look like – as well as what related options might be created as demonstrations by the new Center for Medicare and Medicaid Innovation.

Process v. Outcome Measures
Another confusing aspect of discussions about reformed or transformed healthcare is a blurring between measuring processes and outcomes – both clinical and economic. Part of this blurring occurs because process measures are often used as proxies for outcomes. While these type of proxy measurements are common in clinical medicine, (e.g., blood cholesterol levels are a proxy for risk of heart attacks and stokes), using them for broad transformations in healthcare is more challenging because there is generally a very strong desire to see the savings (or improved clinical outcomes) before investing time or money to expand the reforms.

Conclusion: Focus on the Fundamental Big Questions
So, to simplify thinking about how to create a better healthcare system in the US, I recommend coming back to these two sets of questions:

What is the structure? And what are the reimbursement systems/arrangements?
What process and outcome measures will be used to evaluate the new structures and reimbursement systems? And how do those process and outcome measure relate to each other, i.e. how do we think the process measures lead to better outcomes?

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