Surgery the biggest cost, say Gawande

According to Reuters, Dr. Atul Gawande, a surgeon who was named this week to head the company being formed by Amazon, Berkshire Hathaway and JPMorgan Chase to trim employee healthcare costs,  cited surgery as the single biggest U.S. healthcare cost and said there are ways to both cut costs and improve patient care. 

Gawande, 52, is a surgeon, writer and public health thought leader and practices general and endocrine surgery at Brigham and Women’s Hospital in Boston.  He is also a professor at the Harvard T.H. Chan School of Public Health and Harvard Medical School and founding executive director of the health systems innovation center, Ariadne Labs. Gawande also is a staff writer for The New Yorker magazine and author of four books on health care.

End-of-life care needs to take into account the wishes of patients, something which he said is now sorely lacking. 

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Vermont is a model health system under review for lowering costs

According to ABC news, OneCare Vermont covered about 24,000 Medicaid patients and now covers about 112,000 patients whose health care is provided through Medicare, Medicaid and commercial insurance.

The long-term goal is to expand it so that about 70 percent of health care services provided in Vermont are covered by the system, which encourages patients to stay healthier using specialized care, such as helping them manage chronic conditions like diabetes so they don't wind up needing more expensive treatment. Officials consider 70 percent a realistic goal.

In a switch from when providers were paid for each service performed, providers are allocated a set amount of money to cover the people in the program. This year, $580 million has been allocated to OneCare Vermont, an organization of health care providers tasked by the state with carrying out the spirit of the program.

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Amazon, Berkshire Hathaway and JP Morgan Chase announce health care company

The New York Times reports that Amazon, Berkshire Hathaway and JPMorgan Chase just announced they would form an independent health care company to serve their employees.

The three companies noted the new entity would initially focus on technology to provide simplified, high-quality health care for their employees and their families, and at a reasonable cost. 

The partnership brings together three of the country’s most influential companies to try to improve a system that other companies have tried and failed to change: Amazon, the largest online retailer in the world; Berkshire Hathaway, the holding company led by the billionaire investor Warren E. Buffett; and JPMorgan Chase, the largest bank in the United States by assets.

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What a Trump election might mean for the ACA

In an article published November 9th on the Health Affairs BlogTimothy Jost, Emeritus Professor at the Washington and Lee University School of Law and a member of the Institute of Medicine, cataloged the potential ramifications of what a Trump Presidency might mean for the Affordable Care Act.  A summary of Jost's arguments are included below:

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What CMS is trying to accomplish with a new drug pricing model

The Obama administration is trying to duplicate efforts by insurance companies to manage drug prices.  The results could lead to a change in how the Centers for Medicare & Medicaid Services (CMS) spends $20 billion a year for drugs under Part B, which are those given in doctors’ offices and hospital outpatient centers. 

According to Kaiser Health News, CMS is following recent efforts by insurers such as Aetna and Cigna to only pay for drugs that work--in the long run.

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CMS announces final round of application for Next Generation ACO model

The Centers for Medicare & Medicaid Services’ (CMS) Innovation Center is accepting the second and final round of applications for its Next Generation Accountable Care Organization (ACO) model, which will begin its second performance year on Jan. 1, 2017.

The Next Generation ACO Model is an initiative for ACOs that are experienced in coordinating care for populations of patients and allows doctors and hospitals to assume higher levels of financial risk and reward than are available under the current Pioneer Model and Shared Savings Program (MSSP). The goal of the Model is to test whether strong financial incentives for ACOs, coupled with tools to support better patient engagement and care management, can improve health outcomes and lower expenditures for Original Medicare fee-for-service (FFS) beneficiaries.

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CMS proposes alternative payment model for Medicare outpatient drugs

The Centers for Medicare & Medicaid Services (CMS) today released a rule to test models for how Medicare pays for prescription drugs provided in physician offices and hospital outpatient departments. 

Medicare Part B currently pays physicians and HOPDs the average sales price of a drug, plus a 6% add-on. 

CMS issued a factsheet on the proposal.  According to the factsheet, the model would test whether changing the add-on payment to 2.5% plus a flat fee payment of $16.80 per drug per day changes prescribing incentives and leads to improved quality and value.

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Commonwealth Fund reports Colorado medical home pilot reduced ED use and costs

According to a Commonwealth Fund study, a multipayer medical home program piloted in Colorado led to a sustained reduction in emergency department use and costs over three years, although there were no overall cost savings for practices or patients. Primary care visits also decreased. The impact on quality was mixed: cervical cancer screening rates improved, yet colon cancer screenings and hemoglobin testing for diabetes patients decreased.

The goal of Patient Centered Medical Homes (PCMH) are to deliver primary care services in a proactive, coordinated manner and improve quality of care, including patient health outcomes– particularly those with multiple or complex care needs.  In addition, the PCMH goal is to lower by reducing the need for expensive hospital stays and emergency department visits.

The Commonwealth Fund research evaluated a pilot program involving 15 PCMH practices in Colorado serving approximately 98,000 patients both prior to the program’s launch and then again at two and three years.

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US spending largely driven by technology and high prices, according to a new Commonwealth Fund report

According to a new report by the Commonwealth Fund, health care spending in the U.S. far exceed that of other high-income countries, although spending growth has slowed in the U.S. and in most other countries in recent years.

The U.S. spends more public dollars on health care than all but two of the other countries.  Americans have relatively few hospital admissions and physician visits, but are greater users of expensive technologies like magnetic resonance imaging (MRI) machines.  Despite its heavy investment in health care, the U.S. sees poorer results on several key health outcome measures such as life expectancy and the prevalence of chronic conditions. Mortality rates from cancer are low and have fallen more quickly in the U.S. than in other countries, but the reverse is true for mortality from ischemic heart disease. 

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CMS reports positive shared savings results for primary care value initiative

According to a blog by Patrick Conway, CMS Deputy Administrator for Innovation and Quality and Chief Medical Officer, CMS is showing promising results for the first shared savings performance year of the Comprehensive Primary Care (CPC) model.  The initiative was launched in October 2012 to advance primary care by paying clinicians to deliver accessible, comprehensive and coordinated care and is part of CMS's broader effort to promote better care, smarter spending, and healthier people.

In performance year 2014, CPC practices showed positive quality results, with hospital readmissions lower than national benchmarks and high performance on patient experience measures, particularly on provider communication with patients and timely access to care. CPC practices that demonstrated high quality care and reduced spending above a threshold shared in savings generated for Medicare.

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CMS announces new Medicare Advantage Value-Based Insurance demo

The Centers for Medicare & Medicaid Services last week announced the Medicare Advantage Valued-Based Insurance Design Model, which will test whether encouraging plan enrollees with certain conditions to consume high-value clinical services through reduced cost sharing and other approaches improves quality and reduces costs.

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The US Department of Health and Human Services announces funding for learning networks

The Department of Health and Human Services (HHS) awarded $685 million to 29 “practice transformation networks,” including some hospitals and health systems, and 10 supporting organizations to help clinicians improve patient outcomes and lower costs for Medicare, Medicaid and Children’s Health Insurance Program enrollees through its Transforming Clinical Practice Initiative.

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Rising drug costs influence national debate over military spending

In most budget years congressional debate over defense spending revolves around the future of Guantanamo Bay, closing of bases around the country, or huge weapons systems.

This year, a dispute over a bread-and-butter matter -- how to pay for the rising cost of prescription drugs -- may be most difficult of all for lawmakers who are trying to close a deal on the bill, H.R. 1735, that would authorize more than $620 billion in defense-related spending.

At issue are benefits for the estimated 9.6 million users of the Pentagon's Tricare health system and resulting profits for retail drugstores including those run by CVS Health Corp., Walgreens Boots Alliance Inc. and Rite Aid Corp.

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Medicare deaths, length of stay and costs decrease over past 15 years

According to a new study in the Journal of the American Medical Association, over the last 15 years the number of deaths, hospital stays and healthcare costs decreased among older Americans on Medicare.

"Although our health care system has its failings, we are making remarkable progress," said Dr. Harlan Krumholz, the study's lead author from Yale University in New Haven, Connecticut.

"People are much better off today than they were 15 years ago," he told Reuters Health in an email. Researchers used data on over 68 million people on Medicare, the U.S. health insurance for the elderly and disabled.  In particular the study found:

  • Deaths from any cause fell among Medicare beneficiares from 5.3 to 4.45 percent between 1999 and 2013.  
  • The number of hospital stays per 100,000 people per year fell by 8,344 between 1999 and 2013.
  • The amount of money spent on care among those beneficiaries in hospitals fell by nearly $500 per beneficiary during that time.
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States' stances on Medicaid appear to affect access, Commonwealth Fund suggests

According to the Commonwealth Fund's Biennial Health Insurance Survey, differences in cost and access for the four largest states of Texas, California, Florida, and New York stem from a variety of factors, including whether states have expanded eligibility for Medicaid, each  state’s uninsured rate prior to the Affordable Care Act taking effect, differences in the cost protections provided by private health insurance, and demographics.

High-intensity primary care may help lower costs and improve quality

“High-intensity” primary care, a model of care similar to the Patient-Centered Medical Home specifically for patients with chronic and multiple conditions, shows promise in lowering costs and improving quality, according to a press release by the National Institute for Healthcare Reform.
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