Financial Returns from E-Prescribing – Saving Medicare $2.1 billion

July 23, 2008 / Michael D. Miller MD / Access to Healthcare, Delivery of Healthcare, Economics & Financing, Information & Communications, Innovation, Medicare, Quality of Care & Safety / 5 Comments

The leadership of HHS had a tele-conference on Monday to highlight the new Medicare incentives for physicians to adopt e-prescribing systems. What the Washington Post and Kaiser Family Foundation reported about this press briefing that wasn’t in the HHS press release was that the Acting Administrator of CMS said that the per physician cost of e-prescribing systems is about $3,000 up front, and then $80-400/month for operation and maintenance.

These numbers caught my eye, because with the incentives in the Medicare bill, the break-even point for physicians is as follows:

First, let’s assume that the per month cost is $240 (the mid-point between $80 and $400), or $2,800 per year.…

Cutting Medicare Physician Payments – Beyond the 10.6%

June 22, 2008 / Michael D. Miller MD / Economics & Financing, Federal Healthcare Reform, Health System Reform, Medicare, Politics / 1 Comment

The focus on Medicare payments to physicians for the last six months has been on the 0.5% increase Congress enacted for the first 6 months of 2008 to replace the 10.1% reduction that would have occurred under Medicare’s Sustainable Growth Rate (SGR) formula. Legislation to continue this rate for the rest of the year failed a required procedural vote in the Senate last week.* This leaves Medicare physician payments after June 30th uncertain – although it is expected that Congress will do something in the next week, or three.

However, beyond the impending Medicare 10.6% reimbursement reduction for all physicians, the Graham Center of American Academy of Family Physicians published a short report on June 13th that expands the analysis to include pending change in how Medicare reimburses physicians in Physician Scarcity Areas (PSAs), and Health Professional Shortage Areas (HPSAs).…

MedPAC Gets Real About Promoting Primary Care

June 15, 2008 / Michael D. Miller MD / Access to Healthcare, Delivery of Healthcare, Economics & Financing, Health System Reform, Medicare / 1 Comment

The Medicare Payment Advisory Commission released its annual report to Congress on Friday. In chapter 2 of its report, MedPAC makes two significant proposals for improving the financial incentives for primary care providers.

Great Incentives for Primary Care Practitioners Not Just Primary Care Services
First, it recommends changing Medicare’s reimbursement system for “evaluation and management” (E&M) services. While last year Medicare increased payments for E&M services, they couldn’t differentiate between types of physicians providing these E&M services, i.e. the Medicare system doesn’t distinguish between a family physician and a cardiologist if they are providing the same type and level of intensity of service.…

Health Reform Evolution

May 12, 2008 / Michael D. Miller MD / Economics & Financing, Health System Reform, Medicare, Politics, Private-Employer Based Health Insurance / No Comments

Placing health reform in an historical context shows how the debate has evolved. For example, the National Bipartisan Commission on the Future of Medicare was formed to address Medicare’s projected insolvency – at a time when the overall focus for health reform was on cost containment. However, while the Commission met and deliberated, the booming economy shifted the debate away from cost containment towards access and coverage expansion, and the Commission’s 1999 final report, proposed adding an expensive outpatient drug benefit to Medicare.

Comparing two more recent perspectives on the future of the US healthcare system also illustrates how thinking about health reform evolves.…

Electronic Medical Records: Salvation or Sinkhole?

May 6, 2008 / Michael D. Miller MD / Economics & Financing, Information & Communications, Medicare, Quality of Care & Safety / 14 Comments

Electronic medical records (EMRs) have been touted as one of the solutions for healthcare’s cost and quality problems. But why haven’t we seen more benefits from EMRs?

Disconnect Between Costs and Benefits
The simple answer is that there is a disconnect between those who have to pay for EMRs and those who benefit from them. For example, many (if not most) national health reform proposals call for investing billions of dollars in EMR systems claiming that EMRs will save the healthcare system lots of money. However, these savings projections hide many important factors related to the timing of any potential savings, and how different stakeholders would be affected.…

The Stressed and Strained Health Care Workforce

April 15, 2008 / Michael D. Miller MD / Access to Healthcare, Clinician-Patient Relationships, Delivery of Healthcare, Medicaid, Medicare, Public Health / 2 Comments

The Institute of Medicine put out a report yesterday titled “Retooling for an Aging America: Building the Health Care Workforce.” The report discusses how the aging of the baby-boom generation will create greater needs for health care providers (of all types) who are trained in caring for the elderly with chronic conditions. The report’s recommendations fall into three categories: training, system transformation and financing. Like many reports about health system improvement, their recommendations all make sense – particularly within the context of the three categories. However, like many IOM reports, the writing by Committee process is a bit evident in that, (at least from the Executive Summary), it doesn’t seem to describe a complete plan, nor does it prioritize any of its recommendations – either in terms of funding or which actions should be done first.…

More on the Supply of Primary Care Clinicians

April 9, 2008 / Michael D. Miller MD / Access to Healthcare, Delivery of Healthcare, Economics & Financing, Medicare, Politics / No Comments

Yesterday, when I wrote about “Ensuring Enough Primary Care Clinicians,” I didn’t realize that public radio station WBUR would be doing a story this week on the same topic. (The WBUR story can be heard/read on their web-site.)

Nor did I know that this was an agenda item for today’s Medicare Payment Advisory Commission (MedPAC) meeting. While the one-page MedPAC briefing summary doesn’t include their draft recommendations, Modern Healthcare reports that they are recommending budget-neutral adjustments to Medicare’s fee schedule to increase payments to physicians who provide primary-care services – including office and home visits, and visits to patients in non-acute facilities.…

More On Evidence Based Medicine

March 6, 2008 / Michael D. Miller MD / Access to Healthcare, Comparative Effectiveness, Delivery of Healthcare, Economics & Financing, Medicare, Quality of Care & Safety / 1 Comment

In a previous post I was somewhat critical of evidence-based medicine (EBM) when it is used to make payment decisions. One of the points I was trying to make is that EBM is not a passing fad. The staying power of EBM was recently reinforced by two recent developments.

First, the Medicare Payment Advisory Commission’s (MedPAC) March 2008 Report to Congress cites their own 2005 report recommending EBM as a touchstone for comparing physicians’ practices as one way to improve quality of care and value for the Medicare program:

In the March 2005 Report to the Congress, the Commission recommended that CMS measure physicians’ resource use over time and share the results with physicians (MedPAC 2005).

…

Government’s Right & Left Hands

February 18, 2008 / Michael D. Miller MD / Access to Healthcare, Economics & Financing, FDA, Information & Communications, Medicare, Politics / 2 Comments

The US government issued two proposals last week that may seem to be a case of the right and left hands not knowing what the other is doing. In the first instance, the Food and Drug Administration (FDA) issued a proposal to allow bio-pharma and medical device companies to more easily distribute published articles that discuss uses not approved by the FDA. In the FDA’s press release discussing the “Good Reprint Practices” draft guidance, Randall Lutter, FDA deputy commissioner for policy, states that “Articles that discuss unapproved uses of FDA-approved drugs and devices can contribute to the practice of medicine and may even constitute a medically recognized standard of care,” and “This guidance also safeguards against off-label promotion.”…

Medicare Cost Containment: Trigger & Physician 10.1% Cut

February 7, 2008 / Michael D. Miller MD / Economics & Financing, Medicare, Politics / 3 Comments

The end of the 2007 Congressional session included a battle about an automatic 10.1% reduction in Medicare reimbursements to physicians scheduled to start January 1st. The resolution to this battle was a temporary legislative fix with a 0.5% increase. However, that fix was only for 6 months, so on July 1st, reimbursements are scheduled to drop by 10.6% from what they are now – the original 10.1% plus the 0.5% increase.

While that will certainly be a focus for Congress this spring, there is another, bigger Medicare fiscal battle likely to be fought because of a provision of the 2003 Medicare Modernization Act (MMA).…

Denial of Off-Label Medicines in Medicare Part D

February 5, 2008 / Michael D. Miller MD / Access to Healthcare, Delivery of Healthcare, Economics & Financing, Medicare, Therapeutic Substitution & Interchange / No Comments

I have been helping the Medicare Rights Center (MRC) with some appeals of Medicare Part D plans denying coverage for off-label uses of FDA approved medicines. These denials are based on a very detailed provision in the 2003 Medicare Modernization Act that the Centers for Medicare and Medicaid Services (CMS) interprets to mean that Part D can only cover FDA approved medicines for off-labeled uses that are listed in at least one of three specific compendia.

I became involved with the MRC’s work on this issue because as a Congressional staff person I had helped write a 1993 law that expanded coverage for cancer treatments under Medicare Part B (that’s “B” as in ball) to specifically include off-label uses listed in the compendia OR supported by articles published in peer reviewed literature.…

US Healthcare Costs & The Economist

January 29, 2008 / Michael D. Miller MD / Economics & Financing, Medicaid, Medicare, Private-Employer Based Health Insurance / No Comments

The January 26th issue of The Economist had a short article about growing healthcare costs in the US. It pointed out (referencing CMS as a source), that healthcare costs had increased 6.7% from 2005-2006, but that Medicare spending had increased 18.7% What these numbers reflect, (but the Economist article only implies), is that because Medicare Part D started in 2006, spending growth shifted from private spending (and Medicaid) to Medicare. Looking at the actual data shows this to be the case:

Public sector healthcare spending increased 8.2% in 2006 compared to 2005; Greater than the 7.1% the previous year
Private sector healthcare spending o increased 5.4% in 2006 compared to 2005; Less than the 6.1% the previous year

Looking closer at the data is even more interesting.…

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