This week’s theme in the New New York (DC) seems to have been payment reform. I was at several meetings recently where this was the topic du jour, and the most consistent message emanating from these various discussions is that volume-based reimbursement (fee-for-service or FFS) has to go. Maybe not immediately, but as soon as possible, and by design.

What to do About it?
Interestingly, most physicians I talk with about this basically agree, but like everybody else in the discussion we are having trouble envisioning what can replace FFS that could work for physicians, nurses, pharmacists and hospitals NOT in integrated systems or under salaried reimbursement. A surprising number of ACC members — including CCAs — are paid by salary, with or without incentives, but a lot of members aren’t. For the 85 percent of American health care providers not in integrated systems or salaried practices, the payment reform ideas (bundling, episodes of care, medical home) will be tough to participate in. The new payment incentives will likely be voluntary and only available to “Accountable Care Organizations” (ACOs) -- meaning integrated systems.

Everybody else will likely be left in an undermined FFS vestigial world. The idea will be to let FFS die and take the dinosaurs with it by attrition. Even if the SGRrrr is fixed for 10 years, any increases proposed are minimal in the current scenarios for FFS Medicare. Two percent for the PQRI reporting bonus will hardly get people excited, nor even keep up with inflation of business costs.

That’s why ACC is looking for ways to create a real upside based on gainsharing or innovative payment strategies related to improving adherence to guidelines and AUC, reducing re-admissions and systematically reducing variation (as compared to having somebody else do that for us or to us). White House and OMB leaders informed me last week that when the AMA and other Gang of Six constituency leaders recently promised Mr. Obama $2 trillion in savings (see more on that in the video below), ACC’s strategies on preventing re-admissions, applying AUC to improve imaging and working on reducing variation, were the most specific things they heard from these groups.

Making it Work
Somebody's listening to us, and in fact we could deliver on these promises. But we will need some incentives to get the ball rolling, and some pilot projects to develop proof of concept, or the Congressional Budget Office (CBO) will be heard laughing in the background. They don’t mark up savings until they see the money on the table. Nonetheless, we’re part of the discussion, at we’re going to convince them they need to take a little risk -- after all we are risking a lot, too.

But I wouldn’t stake my practice future on a FFS reimbursement system for many more years into the future.

 

This month’s post comes to us from past president of ACC’s Virginia Chapter, John Brush, Jr., M.D., F.A.C.C. In addition to serving three years as Chapter president, Dr. Brush practices at Cardiology Consultants, Ltd., in Norfolk, Va., and is an Assistant Professor of Clinical Internal Medicine at Eastern Virginia Medical School. He also has been a leader in quality improvement, assisting ACC efforts with “Door-to-Balloon: An Alliance for Quality” and the IC³ Program, and as a member of ACC’s Clinical Quality Committee.

***********************************************

In the current health care reform debate, there has been considerable discussion about comparative effectiveness. This method of evaluation could provide valuable information on the relative value of competing drugs, devices and treatment strategies, which in turn could improve outcomes, efficiency and satisfaction. Critics are concerned, however, that comparative effectiveness could be used to deny coverage, squelch innovation and ration care. Because of these concerns, some stakeholders forcefully argue that comparative effectiveness evaluations should be totally devoid of cost considerations.

But how can you compare competing treatments and ignore costs? To use heart failure as an example, could you really compare the relative effectiveness of ACE inhibitors and left ventricular assist devices and ignore the wide difference in costs between the two treatments? And isn’t the public’s desire to gain “more bang for the buck” what’s driving health care reform in the first place?

The Case for Cost Effectiveness
Cost effectiveness research is difficult and has recognized limitations. Yet no method of research is perfect or definitive. Although cost effectiveness research has some limitations, we should not reject the useful information that it provides for comparative effectiveness analysis.

There is a compelling need to contain costs in order to extend health care coverage universally in America.  Comparative effectiveness research will give policy makers important information that will help set priorities for spending.  As with clinical practice guidelines, comparative effectiveness analysis should inform, but not dictate clinical decisions.  Personalized decision-making for individual patients should always trump broad policy recommendations.

Comparative + Cost Effectiveness
Comparative effectiveness research and analysis will require a disciplined approach.  Comparative effectiveness research should be a transparent scientific process, absolutely free of economic influence.  Advisory boards that oversee this research and analyze the results should be shielded from undue political influence.  For years, NIH has distributed billions of dollars in funding, using established methods that are generally respected as fair and non-biased.  Similar independence and discipline can be established for overseeing comparative effectiveness research and analysis. 

Comparative effectiveness research using cost considerations should be a two-stage process.  The first stage should pertain to relative clinical effectiveness and the second stage should deal with costs.  For competing treatments with similar clinical effectiveness, no further cost effectiveness research is needed because direct cost comparisons would be simple.  But in comparisons where one treatment is more effective, careful analysis of costs will be necessary to estimate the monetary value of the increased effectiveness.

Constructing a Firewall against Undue Influence
To maintain the integrity of this process, and to shield the process from political and financial influence, a firewall should be constructed between comparative effectiveness evaluation and insurance coverage decisions.  The funding level for coverage is a political or a business issue, not a scientific issue.  The funding level for Medicare is up to Congress, and, ultimately, to taxpayers.  The funding level for private health plans is up to the purchasers and benefit design managers.

Comparative effectiveness analysis can be separated from coverage decisions by borrowing the method used in the process of grant funding:  

• When judging grants, the judges evaluate the grants based on the scientific merit of the grant, without consideration of whether the grant will actually receive funding.
• Grants are graded on a relative scale.
• Top grants that fall within the funding range receive a grant.

Is that rationing?  Perhaps so, but this explicit method of determining coverage seems more rational than the current method for rationing where we deny care to nearly 50 million Americans because they lack employer-based insurance or don’t meet the criteria for Medicare or Medicaid.

The device and pharmaceutical industry is predictably worried about comparative effectiveness.  Undoubtedly, comparative effectiveness would provide pressure on pricing, which is generally lacking when providers and patients pass on costs to third party payers. Transparent comparative effectiveness would give consumers of health care an opportunity to shop for greater value, which will help contain overall costs. 

We Can’t Have it All
This is the unfortunate truth: the growth in health care spending is unsustainable and is making health care unaffordable for average Americans.  In health care, we can have nearly anything we want – we just can’t have everything we want.  Because of escalating costs and limited funding, we need mechanisms to differentiate medical treatments with high value and those with little incremental value.  Without a method to objectively analyze the relative value of treatments, the costs of medical care will continue to rise to unaffordable levels.

-- John E. Brush, Jr., M.D., F.A.C.C.

* Dr. Brush’s post is part of a monthly series of guest posts by ACC leadership. Check back next month to see which ACC leader is sharing his or her thoughts on health care reform!

*** Image from morgueFile (jdurham). ***

 

The HHS Health IT Policy Committee (HIT PC) held its first meeting last week under the direction of (our friend) David Blumenthal, formerly of Partners and Harvard and now Obama’s National Coordinator for health IT in HHS. The HIT PC is going to develop policy recommendations and health IT dollar-distribution strategies for those who show "meaningful use" of an EHR.

That’s $20 billion worth of power theoretically, but only $2 billion of the funding is actually in Blumenthal’s direct oversight. Blumenthal wants to spend at least $300 million training health care workers in how to deploy health IT. He will also deal with privacy insecurity issues, and hire a chief privacy officer; but he seems open to standing up to the bludgeoning he may experience by suggesting a unique patient identifier (UPI) is needed to help track patients in the chronic disease continuum. We strongly agree, David.

The big coming arguments of the HIT PC will be around what the "meaningful use" definition actually means. They have a workgroup to help define that, as well as workgroups on privacy and safety, and another one on interoperability standards. Keep in mind that if your practice isn’t deemed 'meaningful,' you ain't gettin' any money here. It’s worth paying attention to. Believe me, we will not miss those meetings or fail to get involved with the workgroups Blumenthal is forming.

***Image from Flickr (Prasan Naik)*** 

MedPAC, the very influential Congressional advisory body on Medicare, has filled its remaining vacancies with two leaders ACC knows well and can work with:

• Bob Berenson, M.D. -- a policy expert at the Urban Institute who has spoken at various ACC programs (including our Health System Reform Summit) and met with ACC multiple times in the past two years.
• Herb Kuhn -- until December, Kuhn was Deputy Administrator of CMS, and met with ACC many times on various issues. He came out of hospital management career wise.

I have known both men personally for 20 years. We’ve got good relationships with MedPAC—and we need to leverage them to move the quality and payment reform agenda.

The Senate Health, Education, Labor and Pensions (HELP) Committee held a hearing on health care delivery reform and the roles of primary and specialty care in new delivery models last week. Senator Sherrod Brown (D-Ohio) chaired the hearing and inquired about design and implementation of the patient-centered medical home and whether a primary care physician should be sole provider under this model.

Primary, Specialty Care Partnerships
ACC is lobbying to ensure that patients choose where they feel the safest and most comfortable — whether that is a specialty medical home or a primary medical home. In either case, the receiving practice needs to be willing to coordinate all the care and ensure that the patient is getting the most affordably delivered high quality care from wherever necessary. I’m not sure this hearing shed much light on that. I was hoping for more emphasis on the importance of team practice and the needed future importance of partnerships among physicians, nurses, pharmacists, and others to achieve quality, adherence and effectiveness goals.

Steven Schlossberg, a urologist with Sentara Medical Group, did assure the committee that the best outcomes for patients stem from a cooperative partnership of primary and specialty care. He specifically mentioned that Congress should not use Budget Neutrality as a way to strengthen primary care as it would weaken specialty services. Dr. Schlossberg asked for stable and fair reimbursement across the board. 

Reimbursement Issues
ACC has argued that increasing reimbursement for E&M codes across all specialties is critical (Evaluation and Management codes — cognitive doctor visits in the outpatient setting — are very much under-reimbursed). General cardiology, geriatric cardiology and outpatient care across all CV subspecialties is threatened in the same way that primary care suffers if E&M codes are not increased for ALL. This would help primaries the most, but access is a complicated issue.

Witnesses also discussed reducing hospital re-admissions, present and looming physician shortages in the United States, the need to focus on guidelines and reduce waste and the need to implement health IT (duh).

*** Image from Flickr (Brittany G). ***

Our Fly-In advocacy leaders also had a chance to take in part of the Senate Finance Committee’s hearing last Tuesday on financing comprehensive health care reform. [The corresponding policy options paper was released yesterday.]

The Republicans are making some progress on their desire to tax the current exclusion on employer sponsored health benefits — at least above some threshold — as a way of bringing in more money, and of creating some tax fairness between employer coverage and individual coverage. This has to be on the table, even though the President said during his campaign that it would not be. Unions oppose it.

The employer-based system would not be undermined if there were to be a tax exclusion for coverage that exceeds the average cost of insurance in a geography — let’s say the portion of coverage above $5,000 for individuals and $13,000 a year for families. Seventy-five percent of Americans have coverage at or below that level, but for high-rollers, coverage can get much more expensive. If we can collect another $50 or $100 billion in this fashion -- which appears to be possible -- it should be on the table.

The committee also wondered whether hospitals should continue to be tax-exempt if uncompensated care can be nearly eliminated with universal coverage. A good question indeed; and, oh heck, let’s go ahead and put a couple pennies of tax on soda to raise another $10-20 Billion?

*** Image from Flickr (dieselbug2007). ***

With a $600 billion down payment on the critical need to expand access and coverage, the President’s budget (and Congress’ reaction to it) indicates nobody knows where the beef to fund health care reform will come from. The total cost of the president's budget is estimated to be about $900 billion more, at $1.5 trillion over 10 years. In fact, the beef over how to fund reform is the toughest part of the challenges ahead this summer and fall. 

ACC Blitzes the Hill
About 15 ACC member leaders from around the country blitzed the Capitol last week to discuss the budget, the SGRrrr, imaging, the Quality First campaign, and the need for delivery system and payment reforms. We visited more than 40 members of Congress and clearly made an impact. Congress doesn’t hear about specific ways in which costs can be reduced by systematically improving quality, only the other way around. Starting first with cost containment and having quality as a secondary goal will not reduce costs and will have other catastrophic consequences.

Talking about the SGRrrr
Fixing the SGRrrr is one issue that must be resolved for health care reform to happen. The SGRrrr itself will require a $200 – $300 billion fix simply to eliminate cuts without providing increases over the next 10 years for doctors (what a deal!). It is shocking by comparison that it would only cost $7 billion per year in total to add 10 percent to all Medicare physician reimbursements. Being over $250 billion in the hole is no fun. And it’s certainly not the fault of doctors. Weird that Congress expects physicians and other providers to be grateful when they apply band aids to the mess they have created.

During the Fly-In, we heard encouragement from the House members that they want to pony up the money to actually eliminate the SGR deficits and move on; but we heard concern from the Senate that they don’t know where the money will come from to do that. The Dems have proposed reducing what some feel are obscene bonus funding going to those Medicare Advantage insurers (the fee-for-service models) to bring their per capita equivalent reimbursement down to equal fee-for-service (FFS) Medicare funding — which seems only fair. That would save over $200 billion! These cuts don’t affect all Medicare Advantage (MA) plans as severely as they do the FFS versions of it, but Medicare Advantage in general would be affected and some large providers -- like Kaiser Permanente and the big integrated systems would be affected.

However, the 85% percent of the Medicare program not in these large systems is being underfunded -- mainly through the SGRrr. Of course this is controversial. Most Republican offices told us the cuts would be an assault on private insurance (MA) — they say it is the secret agenda focused on the creation of a single-payer government system. But imagine if that MA $230 billion cut drops off the table: It will mean physician payment budget cuts and a failure to go after the SGRrrr. This ain’t fun.

There were some very optimistic things proposed by the President in the budget, and there are some optimistic projections coming out of Congress as well to promote quality of care, new payment incentives, comparative effectiveness and to reduce disparities, but none of that good stuff is going to happen until these ugly mega-issues get resolved. There will be a lot of beefing over this ahead. 

P.S. -- Some of you newer readers have asked what the “SGRrrr” is: SGR stands for the (Un-)Sustainable Growth Rate (SGR) physician payment formula in Medicare, which all doctors hate. SGRrrr is simply the SGR expressed as a growl. 

*** Image from Flickr (Charles P.) ***

Kaiser Permanente has substantially improved the heart attack survival rate for its members in Colorado through an innovative program that links coronary artery disease patients and teams of pharmacists, nurses, primary care doctors and cardiologists, with an electronic health record (EHR) and advanced clinical care registry.

George Halvorson, CEO of Kaiser, underscored that technology and treatment innovations alone are not enough.  

“It was not newer or more expensive treatments, but an integrated approach to deliver the right care at the right time. Maximizing information for the clinician means optimizing care for the patient."

The Kaiser pilot integrated front-line nursing and pharmacy teams that worked with cardiovascular patients and their physicians. The program achieved the following results:

• Patients had an 88 percent reduced risk of dying of a cardiac-related cause when enrolled within 90 days of a heart attack, compared to those not in the program;
  
  
• The number of patients meeting their cholesterol goal went from 26 percent to 73 percent, and;
  
  
• The number of patients screened for cholesterol went from 55 percent to 97 percent.

Proof positive that technology and coordinated team-based care can make a change for the better in the quality of cardiovascular care.

ACC President Fred Bove, M.D., F.A.C.C., staff Senior Vice President of Advocacy Jim Fasules, M.D., F.A.C.C., and I attended the HHS Secretary Kathleen Sebelius’ testimony before the House Ways and Means Committee last week. She did very well and stressed the need for measuring quality, for choice of doctor and hospital and for reducing rising costs. She implied the choice of a "public plan" to compete with private insurance was an option still on the table.

We issued a response to her testimony: “Leaders in both parties and the health care community agree: The American health care system needs to change. What we heard from Secretary Sebelius and committee members is that change needs to come sooner rather than later. The ACC has long advocated for several of the reforms Secretary Sebelius testified about today including payment reforms and the development of a health information technology infrastructure.”

Sebelius also mentioned two annual reports HHS issued last week that all of us should take note of:

• The annual 2008 National Healthcare Quality Report — the highlights are that between 40 and 50 percent of patients do not receive evidence-based (guidelines, performance measures, appropriate use criteria) care in the average inpatient or outpatient encounter. Also, in terms of patient safety, huge gaps continue to be documented. For example, we could save $20 billion by reducing variation and eliminating preventable inpatient nosocomial infections (IHI has demonstrated this is possible).
  
  
• The annual 2008 National Healthcare Disparities Report — Health care is still doing an abysmal job of reducing and changing the disparities problem, despite all the related rhetoric. The ACC is working on a couple of things that would hopefully help this problem: ACC’s CREDO (The Coalition to Reduce Racial & Ethnic Disparities in (CV) Outcomes) project, which will provide new insights for how to solve this problem with respect to CV disease, and using the IC3 Program to improve adherence to guidelines and performance measures.

*** Official photo of Kathleen Sebelius. From Wikimedia Commons. ***

From the Senate perspective the SGRrrr elimination appears less likely this week. As you may recall, Mr. Baucus and the Senate Finance Committee last week proposed a $38 billion, three-year band-aid (a continuation of the past failed approach), but he told me last week at a breakfast meeting that he thinks they can muster together $150 – $200 billion from somewhere (cancellation of the war in Afghanistan?) to get closer to eliminating it. The Administration breakthrough decision to shift the $87 billion of injectable drug costs embedded in SGR from Part B to Part D of Medicare would make the total fix more likely.

The House (Pelosi, et al) still seems committed to look for the complete fix this year, but the Senate doesn’t see how it would be paid for (but hey! If SGRrr goes away, what formula would we use? Why not apply the Medicare Economic Index that the hospitals and the rest of the system use? This seems to provide annual increases that fairly closely approximate increases in the cost of doing business).

Keep in mind that even if Congress finds $280 Billion, physicians would not receive any pay increase over the next 10 years without additional funds. The SGR fix simply eliminates the overt pay cuts. Since business costs nonetheless continue to rise, new payment options for quality are also essential in this reform process. While Baucus insists the Physician Quality Reporting Initiative (PQRI) must continue, the quality improvement bonus attached in the current proposals are likely to be no more than 2 percent, hardly enough to motivate the extra work hours and workflow changes practices need to accomplish to effectively participate.

The ACC and IHI (Institute for Healthcare Improvement) Hospital-to-Home (H2H) project is generating great interest. This may be the kind of direction — one that unfortunately most of our members do not yet appreciate — that is the only pathway toward needed payment reform and payment increase that could keep pace with rising costs of business for practices. Given the rising tide to create reform this year, we will need some Patrick Henrys to ride through all of our chapters and states to let people know big change is coming -- and won’t be a tweak of the status quo. Reform doesn’t necessarily have to come out badly -- but need to make sure we stay at the table.

*** Image from Flickr (vtengr4047). ***