Posts Tagged ‘Obama administration’

GOP Proposes Putting Seniors on Congressional Healthcare Plan

Tuesday, July 3rd, 2012

In a highly controversial move, Republicans critical of Medicare have proposed opening up the Federal Employee Health Benefits Plan (FEHBP) to Medicare patients.  “We are going to offer a plan that would give all senior citizens in the country the same congressional healthcare plan that we have,” said Senator Rand Paul (R-KY).  “We are not willing to wait until after the next election to fix the entitlements.”

The National Active and Retired Federal Employees Association (NARFE) warned that the plan could shake the federal program, while asking seniors to pay more for healthcare.  “This is a kill-two-birds-with-one-stone kind of proposal that would both bring down Medicare as we know it and threaten the stability of the FEHBP,” Joseph A. Beaudoin, NARFE president, said.  Beaudoin said seniors should examine the proposal closely, because it throws open the doors of a stable healthcare program to millions of seniors currently enrolled in Medicare.  “Given the current environment of budget attacks on federal employees, retirees and Medicare, the federal workforce and all Americans should be wary of plans like the one proposed today,” he said.

Called the Congressional Health Care for Seniors Act (CHCSA), the plan’s supporters claim that it would save taxpayers $1 trillion in the first 10 years as well as provide enhanced healthcare benefits, choice, quality and outcomes by moving seniors into the FEHBP.

How would it work?  Federal employees can now choose from approximately 250 plans participating in FEHBP, including 20 nationwide plans.  The large selection provides access to better doctors, better quality healthcare, and the ability to pick plans that best suit the person’s individual needs.  The rationale also is that because Congress uses the plan, it must be the best in the country.  Additionally, the legislation would set up a “high risk pool” for the costliest patients within the FEHBP.  The federal government will directly reimburse healthcare plans for enrolling the most expensive five percent of patients, which keeps premiums low while allowing high-risk patients to get the same quality healthcare as every other enrollee – federal employees and seniors alike.  If the legislation is passed, seniors could enroll in FEHBP starting in 2014.

There is some bipartisan support for this proposal.  In 2004, Senator John Kerry (D-MA) proposed allowing uninsured people, not seniors, to enroll in FEHBP.  “Entitlements are broken,” said Paul.  “It’s not Republicans’ fault; it’s not Democrats fault.  I tell people, ‘It’s your grandparents’ fault for having too many kids and then your fault for not having enough kids.’  It’s a demographic problem.”

Paul said the plan “means-tests the benefits and gradually allows the age of eligibility to go up.”  Currently, Medicare eligibility age is 65; Paul’s plan would gradually increase it to 70 by 2034.  “There is means-testing in this — and the reason you have to do that is: we’re spending more on Medicare than is coming in.”  According to Senator Lindsey Graham, (R-SC), “What I would tell the person near retirement is don’t fear change, embrace it, because you’ll have more doctors available to treat you and your family.  “Think about not just what happens to you…think about where we’ll be as a nation if something doesn’t change pretty quickly with these big programs.”

Virtually everyone in Washington agrees that the federal government must control its deficits and rising debt by finding a way to reduce entitlement spending.  President Bill Clinton’s former budget director, Leon Panetta, now defense secretary, who reproached the Senate Budget Committee: “You can’t meet the challenge that you’re facing in this country” by only cutting discretionary spending, which is less than a third of all spending.  “If you’re not dealing with the two-thirds that is entitlement spending, if you’re not dealing with revenues, and you keep going back to the same place, frankly you’re not going to make it, and you’re going to hurt this country’s security.”

Paul acknowledges that adding seniors to the federal program would drive costs up for its current 8.5 million enrollees by approximately 24 percent.  “Federal employees are the one group of people who may have a legitimate argument with the Congressional Health Care Plan for Seniors,” according to Paul’s synopsis.  “Asking them to share their healthcare with the elderly will cause their premiums to increase.”  Not surprisingly, as soon as the legislation was announced, the National Active and Retired Federal Employees Association expressed concerns that the bill would destabilize the federal workers’ program.

Beaudoin notes that “As for the senators’ notion that America’s seniors should be in the same healthcare system as America’s elected officials, they seem to have forgotten that starting in 2014, members of Congress will no longer be covered by the FEHBP but will be in state-based healthcare exchanges.”

Non-Profit Hospitals Will Take Financial Hit If the Individual Mandate is Struck Down

Monday, May 14th, 2012

If the Supreme Court overturns the individual mandate that requires Americans to buy healthcare insurance that is contained in the Patient Protection and Affordable Care Act (ACA), non-profit hospitals will struggle with higher costs, according to Moody’s Investors Service.  The individual mandate has become the focus for legal attacks on the healthcare law.  It “would result in a significant reduction in uncompensated care delivered by hospitals” and reduce “utilization of expensive emergency room services,” the rating agency said.

“If the Supreme Court overturns the individual mandate, the private health insurance market would likely weaken under the unbalanced weight of strict provisions to cover all those who seek insurance without the counterbalancing benefit of a new, largely healthy, population segment that would be provided under the mandate,” Moody’s said.  “This scenario could become untenable for many insurers and hospitals, as costs would rise but revenues would not.”

There are additional challenges to non-profit hospitals in the ACA, specifically cuts in reimbursement rates for Medicare and reduction of funds paid to hospitals that serve a disproportionate share of Medicaid recipients, Moody’s said.  “Removing the mandate would make the negative features of reform loom much larger.”  Moody’s said the federal government could turn to a voucher system in which individuals would receive public help for them to buy health insurance, but the results for non-profits hospitals “would be more complex and hard to foresee.”

This is bad news because by a nearly five-to-one margin, hospitals expect the ACA to shrink their revenues. The result suggests that hospital executives are having second thoughts about the deal they made with the Obama administration in exchange for supporting the healthcare overhaul will help them weather the law’s financial repercussions.

According to a recent poll, 55 percent of hospitals and health systems anticipate falling revenues as a result of the law, while 12 percent expect an increase.  Twenty-eight percent were unsure of the law’s effect on revenue, indicating continued concern in the industry over the changes wrought by healthcare reform.  Hospital executives agreed to give up $155 billion in government payments over 10 years in a deal to cap costs borne by the industry as a result of the ACA.  The agreement followed a similar agreement with pharmaceutical companies and enabled the reform.  Two crucial hospital groups — the American Hospital Association and the Federation of American Hospitals — backed the law.  “Hospitals have acknowledged that significant healthcare savings can be achieved by improving efficiencies, realigning incentives to emphasize quality care instead of quantity of procedures,” Vice President Joe Biden said at the time.  “Today’s announcement, I believe, represents the essential role hospitals play in making reform a reality.”

“Hospital and health systems’ financial health has a direct impact on the benefits offered to their employees,” said Maureen Cotter, a senior principal at HighRoads, which took the poll.   “Even though 70 percent of those surveyed stated that they are committed to providing coverage in the long term, and no organizations have plans to discontinue coverage now or in the future, the coverage provided may take a new shape,” Cotter said.

There’s even more bad news in the fact that Howard Dean, a physician who formerly was chairman of the Democratic National Committee, a 2004 presidential candidate and governor of Vermont thinks that the high court will declare the mandate unconstitutional.  Dean believes that Justice Anthony Kennedy’s swing vote will side with the conservative justices when it comes to the individual mandate.  “I do believe that it’s likely the individual mandate will be declared unconstitutional.  Kennedy will probably side with the four right-wing justices. The question is going to be, is this individual mandate question, can that be considered separately from the rest of the bill?  And I think it will be.”

Dean also said the ACA can remain in place without the mandate.  “It’s definitely not necessary for the bill to succeed,” Dean said.  “It was mainly put in by academics who built the program for Governor Romney in Massachusetts, they had did it there, and for insurance companies who will benefit from extra customers.”

According to Dean, “The number of so-called free riders — people who will refuse to get insurance until they get sick — is going to be very, very small.”  Dean noted that the actual benefit of the individual mandate is “relatively small.  Everyone is a libertarian in America, whether Democratic, Republican or independent.  They don’t like to be told what to do by government.”

CMS Chooses 27 Medicare Shared Savings Program ACOs

Wednesday, April 25th, 2012

As the nation waits for the Supreme Court to rule on the Patient Protection and Affordable Care Act (ACA), a key provision that will transform the delivery of healthcare is moving ahead.  According to Kaiser Health News, the Obama administration announced that 27 health systems have been designated as Accountable Care Organizations (ACOs) in Medicare’s Shared Savings Program, which offers financial incentives for physicians, hospitals and other healthcare providers to create more integrated healthcare delivery.  The new ACOs will serve an estimated 375,000 individuals in 18 states.

ACO supporters say they improve care for Medicare beneficiaries and slow rising costs by altering the incentives that affect how physicians and hospitals operate.  Experts cite as models such respected health systems as the Mayo Clinic and the Geisinger Health System of Pennsylvania.  Rather than being paid for each service, ACOs reward providers that manage chronic disease and meet certain quality standards, including reducing hospital admissions and emergency room visits.  If they improve care while holding down costs, the systems can share in the savings.

CMS is reviewing another 150 applications seeking to enter the program, suggesting that the Shared Savings Program is succeeding.  The program is “off to a very phenomenal start,” said Jonathan Blum, a CMS deputy administrator.  “We are on track to fundamentally transform the (Medicare) fee-for-service program.”

Late last year, the Department of Health and Human Services (HHS) chose 32 organizations to participate in an advanced version of the Medicare program.  These “pioneers” have made significant progress in developing the ACO model, with many already largely functioning as ACOs.  During their first two years the pioneers will assume more risk, but with a greater potential reward.  Although hospitals were expected to lead the ACO field, Blum noted that the majority of ACOs are physician-led organizations.  He also said many of the organizations are working with private health insurers to serve patients not in the Medicare program.

Chas Roades, chief research officer at the Advisory Board Company in Washington, D.C., warned that as the ACOS take off and “people actually start to deliver care in a different way, it’s messy and complicated.  There will be successes and failures, and it may go slower than policy-makers would like it to.”  According to Roades, it’s important that CMS create some way for the pioneer ACOs to share their data and best practices.  “It’s a slow ramp but everyone will be watching very closely to see how these early ACOs succeed,” Roades said.

Under the shared savings program, ACOs must meet 33 quality measures relating to care coordination and patient safety, appropriate preventive health services, improved care for at-risk populations and the patient experience of care – while reducing the costs of care.  ACOs that meet the standards will be eligible to share in the program’s savings.

“We are encouraged by this strong start and confident that by the end of this year, we will have a robust program in place, benefitting millions of seniors and people with disabilities across the country,” said CMS Acting Administrator Marilyn Tavenner.

Regarding the anticipated Supreme Court ruling, Emily Brower, an executive director with Atrius Health, operator of a pioneer ACO in Massachusetts, said “It’s not changing anything for us.  This is a model of care we’ve been trying to evolve into since before the pioneer program existed.  We’ll continue making investments, and if the law is overturned, we’ll be asking where the return on investment is for us, if not in shared savings.”

Writing for the e-Care Management blog, Vince Kuraitis is unimpressed.  “I had been anticipating this announcement as a defining moment for Medicare’s thrust into accountable care.  My expectations had been that we would see either:  Boom — a big splash of new Medicare shared savings ACOs announced, including big name hospitals and medical groups that were starting large scale ACOs, perhaps with hundreds of thousands of patients.  Bust — no one showed up at the party.  Providers would have concluded that Medicare ACOs were too risky, bureaucratic, and high effort.  This isn’t the defining moment I thought it would be.  But that defining moment might be just around the corner.  Medicare’s announcement included a mention that they have 150 more Shared Savings ACO applications waiting in the wings.  Is the boom around the corner?”

CMS Chooses 27 Medicare Shared Savings Program ACOs

Wednesday, April 18th, 2012

As the nation waits for the Supreme Court to rule on the Patient Protection and Affordable Care Act (ACA), a key provision that will transform the delivery of healthcare is moving ahead.  According to Kaiser Health News, the Obama administration announced that 27 health systems have been designated as Accountable Care Organizations (ACOs) in Medicare’s Shared Savings Program, which offers financial incentives for physicians, hospitals and other healthcare providers to create more integrated healthcare delivery.  The new ACOs will serve an estimated 375,000 individuals in 18 states.

ACO supporters say they improve care for Medicare beneficiaries and slow rising costs by altering the incentives that affect how physicians and hospitals operate.  Experts cite as models such respected health systems as the Mayo Clinic and the Geisinger Health System of Pennsylvania.  Rather than being paid for each service, ACOs reward providers that manage chronic disease and meet certain quality standards, including reducing hospital admissions and emergency room visits.  If they improve care while holding down costs, the systems can share in the savings.

CMS is reviewing another 150 applications seeking to enter the program, suggesting that the Shared Savings Program is succeeding.  The program is “off to a very phenomenal start,” said Jonathan Blum, a CMS deputy administrator.  “We are on track to fundamentally transform the (Medicare) fee-for-service program.”

Late last year, the Department of Health and Human Services (HHS) chose 32 organizations to participate in an advanced version of the Medicare program.  These “pioneers” have made significant progress in developing the ACO model, with many already largely functioning as ACOs.  During their first two years the pioneers will assume more risk, but with a greater potential reward.  Although hospitals were expected to lead the ACO field, Blum noted that the majority of ACOs are physician-led organizations.  He also said many of the organizations are working with private health insurers to serve patients not in the Medicare program.

Chas Roades, chief research officer at the Advisory Board Company in Washington, D.C., warned that as the ACOS take off and “people actually start to deliver care in a different way, it’s messy and complicated.  There will be successes and failures, and it may go slower than policy-makers would like it to.”  According to Roades, it’s important that CMS create some way for the pioneer ACOs to share their data and best practices.  “It’s a slow ramp but everyone will be watching very closely to see how these early ACOs succeed,” Roades said.

Under the shared savings program, ACOs must meet 33 quality measures relating to care coordination and patient safety, appropriate preventive health services, improved care for at-risk populations and the patient experience of care – while reducing the costs of care.  ACOs that meet the standards will be eligible to share in the program’s savings.

“We are encouraged by this strong start and confident that by the end of this year, we will have a robust program in place, benefitting millions of seniors and people with disabilities across the country,” said CMS Acting Administrator Marilyn Tavenner.

Regarding the anticipated Supreme Court ruling, Emily Brower, an executive director with Atrius Health, operator of a pioneer ACO in Massachusetts, said “It’s not changing anything for us.  This is a model of care we’ve been trying to evolve into since before the pioneer program existed.  We’ll continue making investments, and if the law is overturned, we’ll be asking where the return on investment is for us, if not in shared savings.”

Writing for the e-Care Management blog, Vince Kuraitis is unimpressed.  “I had been anticipating this announcement as a defining moment for Medicare’s thrust into accountable care.  My expectations had been that we would see either:  Boom — a big splash of new Medicare shared savings ACOs announced, including big name hospitals and medical groups that were starting large scale ACOs, perhaps with hundreds of thousands of patients.  Bust — no one showed up at the party.  Providers would have concluded that Medicare ACOs were too risky, bureaucratic, and high effort.  This isn’t the defining moment I thought it would be.  But that defining moment might be just around the corner.  Medicare’s announcement included a mention that they have 150 more Shared Savings ACO applications waiting in the wings.  Is the boom around the corner?”

HHS To Step Up Alzheimer’s Research

Monday, April 9th, 2012

Federal officials have taken another step toward their goal of better treatment for and even prevention of Alzheimer’s disease by 2025, according to Kaiser Health News. A more comprehensive, draft version of the Obama administration’s national plan to address Alzheimer’s is now available. Experts emphasized expanding and better coordinating disease research, primarily through public-private partnerships.  They also stressed improved preparation for the healthcare workforce, enhancing public outreach and providing Alzheimer’s families with financial and other support.  To achieve these goals, President Obama proposed an additional $106 million in federal funds as part of his 2013 budget.

The Alzheimer’s advisory council provides new specifics about how the money will be used.  For example, they propose creating registries to better direct Alzheimer’s patients into clinical trials, as well as establishing a national inventory of research investments.  On the healthcare side, the council proposes working with private partners to develop evidence-based guidelines for Alzheimer’s care and establishing a national clearinghouse to publicize those recommendations.  Additionally, the council advocates that new healthcare models – such as the medical homes and accountable care organizations promoted by the Patient Protection and Affordable Care Act (ACA) – be analyzed for outcomes among Alzheimer’s patients.

The draft plan, issued by the Department of Health and Human Services (HHS), places top priority on treatment, and focuses on the burden the disease places on families and caregivers.  “Alzheimer’s burdens an increasing number of our nation’s elders and their families, and it is essential that we confront the challenge it poses to our public health,” President Barack Obama said.  The White House plans to divert an additional $50 million this year from HHS projects to Alzheimer’s research, and seeks an extra $80 million in new research funding in fiscal 2013.  “These investments will open new opportunities in Alzheimer’s disease research and jumpstart efforts to reach the 2025 goal,” according to HHS.

Eric Hall, president and chief executive of the Alzheimer’s Foundation of America and a member of the advisory council that has been working with HHS, said the draft proposal addresses many of the panel’s concerns.  “Given the current economic environment that limits much-needed resources and the scientific unknowns of this disease, we believe that defeating Alzheimer’s disease will likely happen in a series of small victories,” Hall said.  He was particularly satisfied that the plan focuses on educating healthcare providers on detecting early signs of cognitive impairment and linking newly diagnosed families with support services.

A differing perspective was offered by George Vradenburg, chairman of USAgainstAlzheimer’s and an advisory panel member, who said the draft plan does not go far enough.  “This first draft fails to present a strategy aggressive enough to achieve the goal of preventing and treating Alzheimer’s within 13 years,” he said, noting that the plan lacks specific timelines and does not hold any high-level officials accountable for meeting the plan’s goals.

More than five million Americans already have Alzheimer’s or similar dementias, a number that is expected to rise to 16 million by 2050, along with skyrocketing medical and nursing home bills, because the population is aging so rapidly.  “They’ve covered the right topics.  What is needed now is more detail,” said Alzheimer’s Association President Harry Johns.  “There’s real recognition at this point that Alzheimer’s is devastating for not only the individual but for the families and caregivers.”

ACA’s Future Unclear As It Celebrates Its 2nd Birthday

Tuesday, April 3rd, 2012

As the Patient Protection and Affordable Care Act (ACA) celebrates its second birthday, the Obama administration reminded senior citizens – one of the most reliable voter blocs — exactly how much healthcare reform has helped them.  Coverage of the “donut hole” in prescription drug plans saved five million seniors and disabled people $3.2 billion.  According to data from the Centers for Medicare and Medicaid Services (CMS), through the first two months of 2012, roughly 103,000 Americans saved $93 million in the donut hole.  “Without the healthcare law, more than 5.1 million seniors would have faced $3.2 billion in higher drug costs,” Health and Human Services Secretary Kathleen Sebelius said.  The donut hole is a gap in coverage for prescription drugs under what is called Medicare Part D.  Part D covers 75 percent of the cost of prescription drugs until total medication spending for the patient hits $2,800.  Then the hole opens, and seniors must pay out of pocket until they have spent $4,550.  After that, Medicare pays about 95 percent of drug costs.

The ACA sent all seniors who hit the prescription drug donut hole a one-time $250 check.  In 2011 and 2012, seniors in the donut hole receive a 50 percent discount on brand-name drugs.  Additionally seniors covered by traditional Medicare received wellness check-ups and screenings for diseases like cancer and diabetes without paying anything out of pocket.  Under the law, the donut hole phases out in 2020.

The seniors’ lobby AARP launched its largest-ever outreach effort with ads and town-hall meetings aimed at defending Medicare and Social Security.  “We’re not leaving it up to chance” that the public hears about the law’s benefits, congressional Seniors Task Force co-chairwoman Jan Schakowsky (D-Ill.) said.  Democrats, Schakowsky said, have made it a “primary organization effort”…”to tell the truth (about the law) over the next several months.”

Writing in The Hill, Julian Pecquet says that “Democrats see the Ryan budget, which is expected to propose replacing Medicare with subsidies for people to buy insurance, as political gold ahead of the November election.  Republicans for their part will spend the week hammering the law’s ‘broken promises’ — higher premiums, employers dropping coverage and the soaring cost of insurance subsidies when compared to the earlier budget window Democrats highlighted when they were debating the law two years ago.  They’re also arguing that the healthcare law hastens Medicare’s insolvency by removing $500 billion from the program to pay for what they call an unsustainable new entitlements.”

In terms of implementing the law to meet the 2014 deadline, the ACA leaves it up to the states to set up health insurance exchanges.  In states that refuse to do that, HHS has the authority to create a federal exchange as a backup — but it could be stretched thin if it has to cover too many states.  At the moment, a number of states are not making plans and the federal exchange could end up covering as many as 15 to 25 states.

Other states are biding their time depending on the outcome of the Supreme Court case — and the elections — to decide what to do next.  There’s an excellent possibility that many of them won’t be far enough along by January of 2013, when HHS has to either certify the states’ exchanges or prepare to run a federal exchange in those states.  HHS has already extended the deadline for states to apply for the grants that will help them run exchanges.  And it’s taking other steps to help states that won’t be ready in time.  But if a lot of states refuse to create the exchanges –and more time won’t help them — HHS will be forced to act.

White House spokesman Jay Carney told reporters that President Obama is looking beyond past battles. “He is focused on a forward agenda right now, and working with Congress and doing the things he can through executive action to grow the economy and create jobs,” Carney said.

Republican leaders, who once accused the president of focusing too much on healthcare and not enough on jobs, now say the White House is moving away from the ACA because of uncertainty over whether or not its individual mandate is constitutional.  In terms of the upcoming Supreme Court oral arguments, Senator Roy Blunt (R-MO) said “I think we’ll win in the end.  Now the question is how long is it until the end.  There’s no question that the president’s plan will not work.”

A differing opinion was offered by Democratic Caucus Vice-Chairman Xavier Becerra (D-CA).  “I think as time goes by more and more people are beginning to support the reform because it starts to apply to them.  The more people see what the ACA does, the more they’re going to like it.”

CMS’ Value-Based Purchasing Program Is In the Works

Wednesday, March 28th, 2012

The Department of Health and Human Services (HHS) is formulating a new initiative to reward hospitals for the quality of care they provide to Medicare patients and reduce healthcare costs.  Authorized by the Patient Protection and Affordable Care Act (ACA), the Hospital Value-Based Purchasing program marks an historic change in how Medicare pays healthcare providers and facilities — for the first time, 3,500 hospitals nationwide will be paid for inpatient acute-care services based on care quality, not just the quantity of the services they provide.

This initiative supports the objectives of the Partnership for Patients, a public-private partnership that will help improve the quality, safety and affordability of health care for all Americans.  The partnership has the potential to save 60,000 lives and up to $35 billion in U.S. healthcare costs over the next three years, including up to $10 billion for Medicare.  Over the next ten years, the Partnership for Patients could reduce costs to Medicare by about $50 billion and result in billions more in Medicaid savings.

“Changing the way we pay hospitals will improve the quality of care for seniors and save money for all of us,” said HHS Secretary Kathleen Sebelius.  “Under this initiative, Medicare will reward hospitals that provide high-quality care and keep their patients healthy. It’s an important part of our work to improve the health of our nation and drive down costs.  As hospitals work to improve their performance on these measures, all patients – not just Medicare patients – will benefit.”

The Hospital Value-Based Purchasing initiative is just one part of a broad effort by the Obama Administration to improve the quality of health care for all Americans, using important new tools provided by the ACA.  The Partnership for Patients brings together hospitals, doctors, nurses, pharmacists, employers, unions, and state and federal government committed to keeping patients from getting injured or sicker in the health care system and improving transitions between care settings.  The Centers for Medicare and Medicaid Services (CMS) is investing up to $1 billion to drive these changes.  Additionally, proposed rules allowing Medicare to pay new Accountable Care Organizations (ACOs) to improve coordination of patient care are also expected to result in better care and lower costs.

In essence, the program rewards hospitals that perform well on quality measures relating both to clinical process of care and to patient experience of care, or those making improvements in their performance on those measures.  Hospitals that meet performance criteria will receive higher compensation.  The hospital value-based purchasing program, which is expected to become effective in fiscal 2013 for payments for discharges occurring on or after October 1, 2012, would make value-based incentive payments based on how much the hospitals’ performance improves certain quality measures during a baseline timeframe.  The better a hospital’s performance or improvement during the performance period, the higher the hospital’s value-based incentive payment would be, according to CMS.

According to CMS estimates, approximately 50 percent of the facilities participating in this Hospital Inpatient Value-Based Purchasing program will receive a net increase in their Medicare payments.  The other half will see a net decrease.  Neither the increase nor the decrease will exceed one percent in the first year, CMS said.  The better-performing hospitals in the first year have the potential to receive value-based incentive payments totaling as much as two percent of Medicare reimbursement, or a net one percent extra,  CMS sees the program as “the next step in promoting higher quality care for Medicare beneficiaries.”  When the program gets underway, CMS said, the government will reward hospitals on the basis of “actual quality performance,” and not just data.

Jean Moody-Williams, director of the Quality Improvement Group within CMS’ Office of Clinical Standards and Quality, said the Hospital VBP Program is funded by a one percent withholding from participating hospitals’ diagnosis-related group (DRG) payments; hospitals excluded from the program will not have that one percent withheld from their DRG payments.  “The goal of CMS through the Hospital Value-Based Purchasing Program is to link payments to quality outcomes,” Williams said.  “We really are starting to get away from asking, ‘How much did you do?’ to ‘How well did you do and how was it for the patient?’”

The American Hospital Association (AHA) has serious reservations about the program, noting that “CMS has not met its requirements with respect to certain measures.  This failure will unfairly and adversely impact the hospital field and even undermine the intent of the law, which is to provide opportunities for hospitals to improve their performance.”

According to the AHA, the problem “is exacerbated in the outpatient PPS (prospective payment system) rulemaking cycle because it builds on policies that fail to comply with the law’s requirements.” AHA also expressed concern with how the agency handled the notice and comment process for the hospital VBP program, which “made significant changes to this program in three separate regulations,” and suggested that the agency choose a single regulation in which it will make any future changes to the program.

EHR Adoption Moving Forward

Wednesday, March 14th, 2012

The nation’s hospitals must demonstrate that they have collected the vital statistics of more than 80 percent of their patients in digital form if they want to continue receiving as much as $14.6 billion in federal grants for installing electronic health records (EHR) technology.  Awards as large as $11.5 million are available to hospitals that can prove “meaningful use” of the equipment, under preliminary rules issued by the Obama administration.  Physicians can apply for grants of $44,000 or $64,000, depending on whether they treat patients in Medicare or Medicaid.

The rules continue carrying out an initiative in the American Recovery and Reinvestment Act (ARRA) as a step toward overhauling the nation’s healthcare system, specifically in the Health Information Technology for Economic and Clinical Health (HITECH) Act.  Hospitals and doctors should achieve “substantial benefits” from adopting digital records, including lower record-keeping costs, fewer pointless tests, shorter hospital stays and reduced medical errors.

The percentage of U.S. hospitals that have adopted electronic records more than doubled between 2009 and 2011, to 35 percent, according to the American Hospital Association.  Approximately 85 percent of hospitals told the association that they plan to take advantage of government incentives by 2015.  The government expects that by 2019, 96 percent of hospitals will adopt electronic records and at least 36 percent of doctors’ practices.

In this second stage of adoption of EHR, the government is emphasizing making sure that electronic systems can talk to one another – or are “interoperable.”  According to Kaiser Health News, it’s “a real push ahead,” said Farzad Mostashari, the national coordinator for health information technology.  The rules require systems be able to transfer patient information across platforms.  A “summary of care” — including past diagnoses, procedures and test results – must be able to follow patients across referrals and changes in health care provider.  Additionally, the information should be available to some patients, who under Stage 2 requirements must be allowed to view their records online, as well as download and transfer information.  Finally, some patients must be able to communicate with their doctors through a secure, online system.

According to a survey of 302 hospital IT executives, more than one-quarter said they had already proven to the Centers for Medicare and Medicaid Services (CMS) that they have met the government’s standard for the first stage of meaningful use of health IT.  That means they have demonstrated that they have the baseline capabilities in their CMS-approved health IT system to collect and submit data.  Stage 2 also deals with security of exchanging patient information electronically, particularly the risk of a doctor mistakenly leaving his laptop or iPad accessible to the public.  “A huge, huge, huge portion of all breaches don’t occur because someone hacked into the system; they occur because people left their laptop on the train and they didn’t encrypt it,” Mostashari said.

Writing on the practicefusion.com website, Robert Rowley, M.D., says that “Stage 2 is about connectivity.  So let us take a step back and re-assess the larger picture.  Stage 1 Meaningful Use is about adoption of EHRs into the daily practice of clinicians and hospitals.  It is about moving the documentation of healthcare away from paper, and onto a digital platform.  The platform didn’t really have to connect with anything, though the capability to connect needs to be built for the technology to be Certified.  Stage 2 is about connectivity.  Now that EHRs are adopted, implemented and used meaningfully, the next stage is intended to be about connecting the silos together.  Stage 3, to come later, will be about inserting Decision Support between the connections, so that best practices (as well as authorizations) become part of the daily fabric of healthcare.”

A little-known fact is that EHR adoption is having a positive impact on healthcare IT job creation.  According to job resource Medzilla, an estimated 50,000 new jobs have been created in the health IT field since 2009, when the government passed the HITECH Act, which authorized funding for the EHR incentive program.  “The statistics over the past few months have been more than encouraging,” said Del Johnson, director of client relations at Medzilla.  “Here you have two, previously separate industries that are rapidly growing into one another.  Where the two meet you have an opportunity to explore a completely new labor pool.”

Cost of Alzheimer’s High in Dollars and Caregiver Devotion

Tuesday, March 13th, 2012

As baby boomers age, the cost of caring for those stricken with Alzheimer’s Disease has nowhere to go but up. By 2050, the cost of treating Alzheimer’s is likely to rise from $172 billion per year in 2010 to more than $1 trillion per year in 2050.  The disease could cost Americans $20 trillion over the next few decades, according to a report from the Alzheimer’s Association.

“We saw it coming.  We knew the numbers were going to be high in the number of people getting the disease.  We as an organization have been preparing for this,” said Nancy Rainwater, vice president of communications for the Alzheimer’s Association Greater Illinois chapter.  “But to think of trillions of dollars…just the amount of money was pretty staggering.”

The statistics were calculated using an analytical model based on data from research and national surveys.  Part of the problem lies in how successful treatment has become for other diseases, Rainwater said.  “We’re living longer, so that has a lot to do with it,” she said.  “There has been so much work in other diseases – cancer, diabetes, heart disease – and people are surviving those diseases.  But then there’s a higher risk, as people age, of getting Alzheimer’s.  You look at statistics of those diseases, and the rates of death have all declined, whereas Alzheimer’s disease has increased.”

Researchers believe that the number of Americans aged 65 and older with Alzheimer’s will more than double to 13.5 million by 2050 as the population ages.  By the middle of the 21st century, nearly 50 percent of people with the disease will be in its most severe – and costly – stage.  “People in the earlier stages don’t necessarily need as much care or support,” said Darby Morhardt, social worker and research associate professor at Northwestern University’s Cognitive Neurology and Alzheimer’s Disease Center.  “But as they deteriorate, as they decline, they have more and more difficulty managing their daily care, so that care needs to be provided by someone.  Often that’s where most of the money is spent, on those last years.”

What’s most stunning is Alzheimer’s human and financial toll. According to the Alzheimer’s Association’s 2011 Facts and Figures Report, 5.4 million Americans (one in eight older Americans) suffer from the debilitating illness.  Joy Johnston of Atlanta knows how difficult caring for a parent with Alzheimer’s can be.  Her father, Patrick, like more than five million other Americans, had been diagnosed with Alzheimer’s Disease.  “It can be heartbreaking at times,” Joy said in reference to caring for her father.  “You have to relearn your relationship with your loved one.”  Caring for a family member with Alzheimer’s can take a profound financial and emotional toll.  Nearly 15 million Americans are unpaid caregivers for those sick with dementia, according to the Alzheimer’s Association.  Do the math, and it adds up to about 17 billion hours of unpaid care valued at $202 billion in 2010 alone.

To help with the staggering cost of care, the Obama Administration has included $26 million in the proposed 2013 budget.  That money will go to education, outreach and support for families affected by the disease.

“Caregivers are often in a situation where their feelings and what they have to do are in conflict,” Dr. Peter Rabins said.  “That’s very hard for most of us because we’ve related with people that we love in a certain way. The disease forces a change in that relationship.”  Rabins, the director of psychiatry at Johns Hopkins School of Medicine, notes that medical bills can pile up quickly.  “That’s a tremendous financial challenge for many families.” Rabins said.

Money isn’t the only sticking point.  The emotional costs take root as soon as dementia is diagnosed.  Family members often begin grieving a death of someone who is still physically present but disappearing mentally.  “Those feelings of loss can become quite chronic,” Rabins says.

“It’s the sort of crisis that policymakers, clinicians know is happening,” said Len Fishman, CEO of Hebrew Senior Life, the largest provider of elder care services in Massachusetts.  “I don’t think the country has absorbed it yet and in a couple of decades when the number of Alzheimer’s cases has doubled, people will look back and say,  ‘Why didn’t we know this was coming?’”

National statistics suggest that it takes an average three to four people to help care for each Alzheimer’s patient living at home; approximately 11 million Americans are currently helping to care for the estimated 70 percent of Alzheimer’s patients who are able to be at home.  That statistic does not include paid caregivers.

Although Medicaid pays for Alzheimer’s day programs for some low-income seniors; Medicare does not.  As a result, many patients and their families must pay privately for Alzheimer’s care until they’ve spent enough money to qualify for Medicaid.  Medicaid does pay for long-term nursing home care, but not the less restrictive assisted living for seniors.

2011 Was a Good Year in Medicare Fraud Battle

Tuesday, March 6th, 2012

The Department of Justice recovered nearly $4.1 billion stolen in healthcare fraud schemes during 2011, according to the Obama administration.  That is a 58 percent increase when compared with 2009.  “This is an unprecedented achievement — and it represents the highest amount ever recovered in a single year,” said Attorney General Eric Holder.  The Justice Department reported that more than 1,400 people were charged with fraud in 500 cases.  More than 700 have been convicted.  “We’re regaining the upper hand in our fight against healthcare fraud,” said Health and Human Services Secretary Kathleen Sebelius.  The numbers are part of the Health Care Fraud and Abuse Control Program Annual Report, which is submitted to Congress every year.

Holder and Sebelius gave credit to their Medicare Fraud Strike Force teams for tracking down crime in areas with “hot spots” of unexplained Medicare billing.  The strike forces include prosecutors and investigators from the FBI, the Justice Department and the Health and Human Services Office of Inspector General.

According to Sebelius, aggressively pursuing health care fraud is a great investment.  “Over the last three years, for every dollar we’ve spent, we’ve put more than seven dollars back in the hands of American taxpayers,” she said.  The money goes into the Medicare Trust Fund, the U.S. Treasury and state treasuries.

From 2009 to 2011, the federal government collected $7.20 for every dollar spent on fighting fraud, according to the HHS inspector general.  That’s an increase from the $5.10 for every dollar spent between 1997 and 2008.  “It demonstrates that our collaborative efforts to prevent, identify and prosecute the most egregious instances of health care fraud have never been stronger,” Holder said.  “Over the years, we’ve seen that as these crimes harm all of us — government agencies and programs, insurers and healthcare providers, and individual patients.”

The Health Care Fraud Prevention and Enforcement Action Teams (HEAT) sent 175 people to prison, with an average sentence of 47 months, according to the Justice Department.  The teams were created in 2009.  “I expect that we will be expanding those efforts to additional cities,” said Peter Budetti, director for the Centers for Medicare and Medicaid Services’ Center for Program Integrity.

The Patient Protection and Affordable Care Act (ACA) sets aside $350 million in healthcare fraud-fighting funds. One of the law’s provisions requires  providers and suppliers wishing to participate in the Medicare, Medicaid, and the Children’s Health Insurance Program that have been deemed to be at higher risk of fraud or abuse to undergo license checks and site visits to confirm legitimacy.

Writing in the Christian Science Monitor, Warren Richey puts this in historical perspective.  According to Richey, “During President Bush’s eight years in office, nearly $1.6 billion was recovered on average each year by federal agents and prosecutors.  In contrast, the Obama administration has recovered an average $3.6 billion per year during each of the past three years.  Fighting healthcare fraud is essential in an administration that is seeking to dramatically increase the level of federal control over the nation’s health insurance system.

But it is unclear from the report to what extent the increased recoveries are a function of more efficient law enforcement or simply the rampant nature of fraud against the government.  Estimates are that healthcare fraud diverts more than $60 billion a year from public health care to criminal enrichment.  Administration officials insist they are bringing fraud, waste, and abuse under control.”

In its fiscal year 2013 budget, HHS proposes to continue making progress against healthcare fraud by increasing support through mandatory and discretionary funding.  The mandatory funding level is $1.3 billion. HHS is requesting $610 million in discretionary funds.  In its FY 2013 budget request, the Justice Department requested $294.5 million in mandatory and discretionary funding to continue the fight against  healthcare fraud.

According to Holder, the department’s civil division filed 1,000 new civil cases in addition to 1,000 pending actions.  The work resulted in $2.4 billion in recoveries under the federal False Claims Act, he said.  “These are stunning numbers,” Holder said.