The Remarkable Consensus Over the Next Steps for Health Reform, Including the Role of Population Health Management

Let's fix it!

While noisy media leprechauns dispense blame and declare winners in the government shutdown imbroglio, the Disease Management Care Blog remains focused on the next steps for meaningful health reform. So are JAMA authors Jack Lewin, Lawrence Atkins and Larry McNeely who, other than one lapse in their editorial, get it mostly right.

Their important insight is that the Bipartisan Policy Center, Brookings Institution, Commonwealth Fund, Kaiser Family Foundation, the National Coalition on Health Care, Partnership for Sustainable Health Care and Urban Institute all have a remarkable degree of overlap in their recommendations for the next phases of health reform. 

Most of these expert organizations agree on the merits of value-based payment as well as insurance reform (pay for quality), information technology, competition, tort reform, evidence-based benefit design (paying when there's evidence that it works), workforce changes (greater efficiency), reforming Medicare, changing tax policy (the exemption for health insurance) and instituting regional or local caps (stick to a budget or there's consequences).

The DMCB wholeheartedly agrees and hopes that the bipartisan consensus evident among these think-tank institutions leads Congress (if not this one, the next) and the President (if not this one....) to use these ingredients to build on the successes and correct the many deficiencies of the Affordable Care Act.

And the lapse? 

Jack Lewin et al were missing one thing. The DMCB looked in each of these organizations' web sites and found that there was also considerable support for population health management.

To wit:

The Bipartisan Policy Center - while the emphasis of this report is on health information technology, the real dividends are pretty clear when it mentions "population health" 14 times:

This plan should address the development and adoption of policies and standards needed for the delivery of care, the empowerment of individuals, and improvements in population health based on national health and health care priorities.

The Commonwealth Fund:

 Effective population health management requires fundamental change in care delivery that must be supported by changes in payment.

National Coalition

Real reform means engaging consumers in their own health and health care choices. In both Medicare and too many private plans today, benefit design neither supports self-management of chronic disease nor distinguishes between care that is effective and care that is not.

Partnership for Sustainable Health Care - see page 22:

Federal nurse education funding should be refocused to equip registered nurses to assume the roles of case manager and population health coordinator.

The Urban Institute - see page 17 on the topic of Medicaid reform:

States can start in select geographic areas or specific population groups (adults and children or specific chronic conditions), and then incrementally expand them after learning from experience and making program improvements and adjustments. Broader efforts typically mean additional stakeholders, increased collaboration and communication.

Prospective Payment Good, Fee For Service Bad, Right? Unless You're a Patient That Is.....

Applying the brake in the name of patient care?

The Disease Management Care Blog poses a simple question: knowing that, despite the best of care, things can occasionally go wrong following surgery (for example, inpatient MRSA infections can still happen and readmission rates will never go to zero), do you really want your doctor or hospital to not be paid for the additional care that you may require?

Go to the websites of organizations like Robert Wood Johnson or The Brookings Institution and you'll find impressive expert papers that extol a variety of "payment reforms" designed to "align incentives," "reduce waste" and "achieve cost savings."  Dig into these reforms and readers will encounter admiration for payment approaches like "prospective payment," case-based," "bundling," and "shared savings."  You'll also find a deep disdain for "fee-for-service" (FFS). 

Prospective good, FFS bad, right? 

"Not always," replies the DMCB. It depends on your point of view. Like, if you're a patient.

The DMCB explains.

The DMCB learned long ago to simplistically think of provider payments in terms of "gas" and "brake" pedals.  FFS applies gas and accelerates provider services; that's because each time a "service" is provided it subsequently generates a "fee." 

In contrast to FFS, case payment, bundling and capitation apply the brakes, because providers receive the payments up-front. Since the money is in hand, providers have an economic incentive to preserve it and withhold services.  The DMCB thinks of "shared savings" in terms of brakes because the up-front payment is essentially held in escrow until the savings (versus a targeted level of utilization) are achieved.

The simplest example of how this can be applied is to hospitalization.  If hospitals are paid for each day that the patient is in a hospital, that's FFS (otherwise known in the industry as "per diem"). 

Instead of per diems, most hospitals are paid with a different payment mechanism based on "diagnosis related groups" (DRGs). Every time a patient is admitted, that generates a payment (similar to FFS).  That payment, however, is not pegged to the number of days the patient stays in the hospital. Instead, the payment is bundled to pay for the entire hospitalization.  That's why hospitals are always willing to admit patients (the gas) and then in a hurry to discharge them (the brakes).

Under the payment reforms championed by Robert Wood Johnson or The Brookings Institution, the inpatient payment bundling would be expanded to pay for the entire case after discharge from the hospital.  Under this system, if the case had to be readmitted, the hospital and providers are SOL.  After all, why should they be rewarded for shoddy care?

Unless, of course, you're the patient.  The DMCB worries that a one-size-fits all approach to payment policy could have unintended consequences. Patients battling unanticipated outcomes would likely prefer that their providers be incented to give additional care.  They want to be back in the hospital.

The payment policy may be good from the point of view of health reform, but it can be bad for patient care. 

The DMCB asks if we are on the verge of another round of unintended health care consequences.

We'll know soon enough when anecdotes of patients being inappropriately denied readmission begin to appear.