Health Care Payment Reform

Aleyda Hernandez told us that, as a young school teacher many years ago, she was nervous to speak up about a problem that the Rainbow Network had not yet addressed.

Leaders in her community were meeting with Keith Jaspers, founder of the Rainbow Network, under a mango tree near her school. As the meeting ended, her concern for her students overcame her worries about asking for too much.

“I got courage to speak, and I said to Mr. Keith ‘Some children in my classroom are passing out from hunger, and I want you to help us. Can you help us?’”

Thus was born Rainbow Network’s program of feeding centers. In April, I was privileged to attend a celebration of 25 million meals served through that program—and to see Aleyda point to the mango tree where she found her nerve.

Seeing Aleyda at the celebration, speaking before hundreds of her Nicaraguan neighbors, American executives and government officials from Nicaragua and the United States, it is difficult to imagine her being fearful of anything.

She was one of many Nicaraguans whose refusal to give into poverty blew me away.

When I first saw their homes—dirt-floor shacks where crooked tree limbs support scraps of sheet metal, fragments of old boards and plastic tarp—I thought I must do more to help these poor people.

By the end of the first day, I realized how much I have to learn from the Nicaraguans whose dignity, resourcefulness and courage are absolutely inspirational.

If I had to walk miles on dusty roads in 95-degree heat to attend the “25 million meals” celebration, would I arrive with a beautiful manicure, hair neatly arranged, my best clothes on display?

If our family “closet” was a rope strung between two trees, would my children go to school in spotless white shirts?

For that matter, if I lived in a country where nearly 50 percent of the people are underemployed, would I bother to seek a scholarship to attend high school?

Would I be willing to guarantee the repayment of microloans granted to my fellow entrepreneurs?

Would I be able to parlay the profits from operating a Xerox machine into funding for my law school education?

Would I seek a loan to start a poultry business if I had to deliver the chickens on a bicycle?

To be honest, I doubt it. But I saw people in Nicaragua doing all that and much more.

I thought I might come home wanting to give more support to the Rainbow Network’s work, and I did. But mostly I stumbled away from that life-changing experience wanting to take more from the inspirational examples of courage shown to me by the people I met in Nicaragua.

American Well is emerging as the first significant player to offer “online care” but others are sure to follow. This is an idea that consumers and employers love.

Hawaii Medical Service Association, the Hawaii Blues plan, is the first insurer to offer the service to its members.

Hear what Dr. Roy Schoenberg, one of American Well’s founders, told me in a recent interview.

Lee Aase, the social media guru at Mayo Clinic, is presenting at the World Health Care Congress Leadership Summit on Consumer Connectivity.

Dr. Bradley Perkins, chief strategy and innovation officer for the Centers for Disease Control and Prevention, tells me that Americans should change the words we use to describe our …well, I no longer want to use the term “health care” because that is too limiting. Read what he told me:

One of the things that we’ve been looking at very carefully is what is the current national dialogue  about health and health care? And it was clear that, for the most part, the dialogue has been about health care, and specifically about access to health care, uninsured people, quality of health care, and the cost of health care.

But the truth is that health is much broader than what happens in the doctor’s office. In fact, most of our health actually occurs outside of the doctor’s office, not as a result of health care. So, we’ve been working very hard to broaden the conversation in this country about what we need to become the healthiest nation in the world.

It’s going to require that all of us work together around notions that we’ve been talking about  as “health protection.” We feel like the word “prevention” is slightly narrow and sometimes gives the context that we’re only talking about what happens in the clinical world. “Health protection” might be a better concept or word to talk about a broader set of efforts around health promotion-how we encourage people to stay healthy;  around prevention -both clinical and community-level prevention; and preparedness-preparedness for emergency threats to our health, which we think are vital for national security.

When it comes to health care payment reform, Dr. Robert Galvin, director of global healthcare for General Electric, is keeping his eye on MedPAC. That means I have my eye on MedPAC because I think major employers will be a huge influence on how health care reform evolves.

Here’s what I heard in my recent interview with Dr. Galvin:

There’s a lot going on in payment reform, and if you look just in the private sector, we think there are now well over 200 pay-for-performance pilots going on. If you look in Medicare, at least seven or eight of their demonstration projects are on payment reform. So, it is a really active area that is, frankly, a bit chaotic at the moment.

I think that with this new administration, the focus is going to go more and more to Medicare, and if you look at Medicare and look at what they’re doing in payment reform, that really drives you right back to MedPAC, which is the agency that advises Congress, particularly on Medicare and particularly on payment reform.

And so I think a good place to start is to look at what MedPAC is suggesting, and it turns out that what MedPAC is suggesting is really pretty similar to what’s going on in the private sector. And I see several big ideas going on. One of the big ideas is that primary care doctors need to be paid more, and that the re-balancing, as it’s called, between specialty care that pays more for more interventions–and the more invasive the intervention, the more it gets paid—is something that people are really looking at. And they’re using the word “re-balancing.”

I think there’s a big push toward coordination of care, and I think you see that in two ways. One is in this concept of medical home, which is the idea that primary care doctors would be paid a new fee that doesn’t exist yet for coordinating care, if they meet the requirements of a medical home. And the other coordination idea going on has to do with this idea of blended payment, or instead of paying hospitals through Part A Medicare and doctors through Part B in a disconnected fashion, that you actually give a lump sum on A and B around particular diagnoses, and then let the doctors and hospitals figure out how to share that money. That’s another kind of coordination play.

The third big thrust I see is in this idea of not paying either for errors or unnecessary care. You see this in the never-events policy where Medicare has listed several events that they are not going to pay for, and some private insurers have followed. And you see it in an idea from MedPAC which says that preventable re-admissions–and they think actually up to 20 percent of people who are re-admitted on the Medicare program could have been avoided with better coordination of care, medication compliance, etc.—that those preventable re-admissions should be paid at a degree much less than the original DRG would tell you

So, those are three big trends – primary trend, coordinated care, and really looking at not paying for errors.

Old news that is new to me….

Serena Stockwell, my editor at Oncology Times, reports that Lancet Oncology cited one of my OT articles in its May 2008, issue:

“We’re going to have to start having a discussion”, Lee Newcomer (United-Healthcare, Minnetonka, MN, USA) recently told Oncology Times. “In the UK, the cost-effectiveness threshold has been set at £40000 per year of life gained by the National Institute of Health and Clinical Excellence. Where is our threshold for how much we spend to gain an extra year of life in oncology?”

The Lancet Oncology is an affiliate of The Lancet, which bills itself as the world’s leading independent medical journal.

To read my entire interview with Dr. Lee Newcomer, check this out.

I enjoyed speaking with Robert Siciliano, chief executive officer of IDtheftsecurity.com, about the issue of medical identify theft.

Mr. Siciliano will speak at the upcoming World Healthcare Innovation and Technology Congress later this year.

Butcher: Information technology is in the process of transforming healthcare delivery. Patients are telling physicians about their symptoms over e-mail and checking their lab tests on line, to give just a couple of examples. What security issues should hospitals and physicians be thinking about?

Siciliano: First, it does start with your information technology administrators. They are responsible to protect you from the outside–from criminal hackers– and from the inside, if you happen to have a bad seed working within your organization. So, it all starts with the IT administrators. The physicians themselves, and the employees at all levels,  need to understand what their responsibilities are regarding safety or security and privacy policies, and those policies must be enforced at all times.

Butcher: If a patient’s personal healthcare information does end up being stolen from a hospital’s computer system, what happens? What is the hospital’s liability?

Siciliano: Over the past few years, there have been some major, major breaches of personal information at the government level, corporations, associations, healthcare, insurance companies – you name it. Just about every industry has been affected by a data breach at one level or another.

And as a result of this, state to state, they have passed data breach notification laws, which require corporations–entities whose information has been compromised–to disclose  that breach and to make sure that they notify those who have been affected by that breach, so that those people can then go out and take the necessary steps in getting protection, in getting some type of insurance, or credit monitoring, whatever the case may be, so that their identity is not further damaged as a result of that breach.

Unfortunately, criminal hackers have changed the motivation significantly over the past few years, and they are really targeting everyone. I mean, nobody is immune.

Butcher: It seems to me that protecting against identity theft ultimately is the individual’s responsibility. Do you see this changing in the future, and if so, how?

Siciliano: Unfortunately, it is absolutely the individual’s responsibility. While the organization may be responsible for doing their part to keep that data safe and secure, ultimately, if it is compromised, it is in the personal identifying information, including name, address, and especially social security number, that individuals are ultimately responsible for self-protection.

Responsibilities do boil down to managing your own personal information, and ultimately making sure that, even if they do get that data, that there’s not a whole lot they can do with it.

Butcher: What should health care executives know about medical identify theft?

Siciliano: First, I think it’s very important that everybody understand the extent of the problem, that the issue of  medical identity theft is becoming an ever bigger problem.

Identity thieves have been working at this for as much as 20 years now, and they’ve figured out just about every single way to compromise our information, and then turn that data into cash.

Over the past few years, they’ve shifted just a little bit and they’re paying even closer attention to our medical information. And throughout the country, I’m seeing more and more reports where you have people checking into hospitals, into clinics, and so forth, and they are posing as the individual who owns this particular social security number and/or insurance policy, and they’re either getting medical treatments under that person’s insurance, or they’re getting pharmaceuticals, prescription drugs, under that person’s medical insurance.

The U.S. health care system comes up smelling like a putrid rose in a survey that compares how citizens in 10 countries feel about their nation’s health care situation.

The report on the survey–actually, several surveys combined–published by Harris Interactive can be found here.

While the  finding that Americans don’t like their health care system surprises no one, it is interesting to see that the other health care systems reviewed also have many detractors. The Harris Interactive researchers sum up their findings this way:

• Regardless of what system a country has, it falls short of public expectations. Most health care systems appear to be continuously in or on the brink of crisis.
•  Governments in all 10 countries that were studied are either changing or debating how to change their system.

The American Medical Association has issued an apology for its long tradition of racial inequality toward black physicians and for accepting segregation within the medical profession.

Institutional racism such as that fostered by the powerful AMA is one of the insidious forces that has contributed to America’s shameful history of white privilege.

I suspect that the rise of Barack Obama as a presidential candidate is forcing many institutions to realize that, within a few months, a black man may become the most powerful person in the world. Funny how power shifts like that.

A new bus is pulling out of the station, and it’s time for every American institution to get on board.

For one thing, the pharmaceutical companies have to pay for all that lobbying effort.  Getting Congress to do your bidding does not come cheap.

The Wall Street Journal reports on a Center for Public Integrity report that the pharmaceutical industry spent $168 million lobbying Congress in 2007, up 32 percent from the previous year.