The Daily Sign-Out

5 Challenges Facing Health Systems

Mary Mosquera, writing in Healthcare Finance News, outlines five broad challenges facing healthcare systems:

Among the biggest challenges that healthcare executives are confronted with this year are:

1. Pacing the shift to value-based models. Healthcare leaders continue to put infrastructure and governance practices in place to support value-based models even as providers still have significant fee-for-service revenue. However, many providers are concerned that they may be reaching a point at which the cost of building and maintaining their value-based organization is not supported by their fee-for-service reimbursement model.

2. Responding effectively to the economic dynamics of local markets. Health organizations that are migrating to value-based models must contend with the realities and limits of their local economies, the strategies of large employers for reducing their healthcare costs, concentration of the payer market and physician practice alignment.

3. Securing and growing market share. Gaining market share remains a big concern regardless of the pace of the payment model change. Providers must weigh market strategies, including consolidation and traditional and non-traditional partnership and strategic relationships, even as volume continues to drive a large share of revenue.

4. Developing alternative revenue streams. Health systems with cash reserves and strong margins are better positioned to make investments that are related to, but not necessarily directly in support of, their core patient care business. Investments that can supplement declining revenue from payers can include ambulatory care centers, telemedicine, business software development and pharmaceutical research.

5. Containing core operating costs. Health executives continue to seek approaches to rein in the costs of their core operations, reduce utilization through standardization, and manage care variations. Even high-performing organizations can obtain additional cost containment by taking a systems approach that is rigorous and transparent.

What are the implications for pathologists, especially those of us still in fee-for-service based groups?  Since we are faced with these same challenges, how will we respond?

Speaking from my own recent experiences in both community hospital and academic medical center settings, pathologists are being increasingly asked to commit significant time and effort to intensively participate in reducing waste and improving appropriateness of care as it relates particularly to lab test utilization and blood utilization.

However, there is currently a disconnection between direct and specific compensation this involvement and the work involved.  Hospitals improve their financial performance (more $$$) but these doesn't seem to be any simoleans coming our ways for the effort.  As Ms. Mosquera reported in an article last year, only about 10% of payments to hospitals and providers are "value-based."  Moreover, of these payments, less than half (43%) give providers financial incentives without risk by offering a potential bonus or added payment to support higher quality care, while 57% put providers at financial risk for their performance if they do not meet certain quality and cost goals.  I wonder, "what's in it for me?" when we bill for clinical pathology professional component--and yet the hospitals are asking me to "lend" my expertise and support to help their bottom line and put my bottom out there to tell clinicans they can't have a certain expensive test or a (probably unnecessary) blood product.  Oh yes, I'm also supposed to educate my clinical colleagues on appropriate test and blood utilization.  I guess we're supposed to be happy that we get the measly "Part A" payment from the hospital? or just have a job?

Pathology groups also need to closely look at #2 through 5 and work through these just as the hospitals are. Unfortunately, the local markets and opportunities for growing market share have been distorted and hurt by condo labs carved out by GI, urology and dermatology groups, national labs hoovering up local groups' AP work below cost, and national-based specialty-based AP companies.  With recent dramatic cuts to 88305 and 88342, there is some hope of getting some of this work back into the community but it may take awhile to play out.  Meanwhile, baby needs a new pair of shoes.

Alternative revenue streams are a more realistic possibility but will require creativity on the part of leaders and managers of pathology groups.  A few will grasp these opportunities.  Most seems to have a deer in headlights look and hope to hang on until retirement.

Containing costs means reducing personnel for groups to me since most of our other costs are more-or-less fixed, unless groups stop offering a range of benefits and shift that onto employees and partners (probably without a compensatory change in salary).

In the words of George Bailey, "Potter's not selling! Potter's buying!"

Recommended Article: Health Care Reform and the Laws of Unintended Consequences

Excellent and thoughtful post not only for those interested in healthcare policy but for anyone interested in 20th century American history. I'd be interested in checking out the author's book.

Health Care Reform and the Laws of Unintended Consequences
Posted By Steven M. Gillon On July 25, 2012 (12:42 pm) In OP-EDBy Steven M. Gillon
When the Supreme Court ruled that President Obama’s sweeping overhaul of the nation’s health care system was constitutional, about the only thing critics and supporters could agree on was the historic importance of the legislation itself. But if history is any guide, there will be one other inescapable truth: The Affordable Health Care for America Act of 2010 will generate the same unintended consequences that have shaped, distorted, and even perverted so many other important pieces of legislation in our nation’s history.
Whether tackling social security, veterans’ benefits, civil rights or immigration reform, Congress has demonstrated over the past 75 years that when it addresses significant social issues with complicated legislation, the results will, more often than not, vary dramatically from what was originally intended. In some instances, as in the case of the GI Bill, the impact was broader than the original drafters could have dared to hope. More commonly, as in the case of social security or immigration reform, a small detail has ended up undermining the loftiest goals of the original bill.
A general rule of thumb for determining how likely a bill is to veer off course is to ask how ambitious the legislation is: the more far-reaching, the more likely it is to produce unanticipated consequences. As we saw with health care reform, big, complicated laws are often the product of partisan brokering and compromise that makes their “intent” ambiguous and open to interpretation. That gives enormous power to the government bureaucrats charged with enforcing the law, and to the courts that are inevitably called upon to settle the conflicts. The gap that opens between the bill’s lofty goals and its often haphazard implementation is the breeding ground for unforeseen results.

Take, for example, what is often considered the most important social legislation passed in the twentieth century — the Social Security Act of 1935. When it debated the benefits of old-age pensions and unemployment insurance that were at the heart of the bill, Congress overlooked a small provision that provided aid for dependent children. It seemed innocent enough: The clause provided a small stipend to a mother raising children following the death of her husband. Everyone assumed that it would be a temporary program that would fade away once social insurance expanded.
How wrong they were.
At the outbreak of World War II, only 360,000 families in the United States were enrolled in the program. But by 1950, the number of recipients had surged to 2.2 million. By the 1960s, that noncontroversial provision provided the legal scaffolding of the modern welfare state. Women moved into the workforce, bureaucrats and politicians expanded the definition of rights and tinkered with the program, families dissolved, and the number of people eligible for welfare exploded. By the time it was abolished in 1996, the government was paying $24 billion a year for that innocuous provision.
Today, nearly everyone hails the GI Bill as one of the most successful and influential laws ever passed. Its impact, however, was accidental. Congress wanted to pass a bill that would avoid the chaos that followed the rapid demobilization at the end of World War I. The most controversial provision, and the one that Congress focused most of its attention on, was a plan to guarantee veterans $20 a week in unemployment benefits. There was little discussion of two other “smaller” provisions: the offer for free college education and low-interest mortgage loans. Roosevelt predicted that the number of vets taking advantage of these benefits would be “in the hundreds of thousands.” Over the years, millions of veterans used these provisions to get a college education and to buy new homes in the sprawling suburbs. The GI Bill proved that unintended consequences can sometimes be fortuitous: The law unwittingly allowed for the expansion of the middle class and
made American postwar prosperity possible.
More commonly, the unintended consequences of major social legislation are debilitating when judged against the Bill’s original intent. One of the key points of debate in the passage of the Civil Rights Act of 1964 concerned the issue of quotas. Conservatives complained that Title VII, which banned employment discrimination, would eventually lead to racial quotas. The White House and congressional leaders assured everyone it would never happen. “If the senator can find in Title VII,” Minnesota senator Hubert Humphrey thundered, “any language which provides that an employer will have to hire on the basis of percentage or quota related to color, race, religion, or national origin, I will start eating the pages one after another, because it is not in there.”
Humphrey was sincere when he made the comment. Neither he, nor anyone in the White House, supported racial quotas. But within a short period of time, officials at the EEOC decided that quotas were the only way to realize the goals of the legislation, and liberal judges backed them up. Ironically, quotas received their biggest boost from Richard Nixon, who used them to drive a wedge between two traditional Democratic constituencies — African Americans and organized labor. Humphrey never did eat those pages, however.
Similar problems plagued the Johnson administration’s efforts to overhaul the nation’s immigration laws. In 1965, with the noblest of intentions, it set out to overturn the “national origins clause,” which set quotas for particular countries based on how many immigrants were living in the United States in 1890. Obviously, the quotas favored countries in Western Europe and placed severe restrictions on immigrants from Asia and Africa. The administration wanted to end discrimination, but it was determined not to increase the overall number of newcomers or dramatically alter immigration patterns. They came up with what appeared to be a simple solution: replace “national origins” with “family unification.” It seemed logical: preference would be given to those people who already had family members living in the United States. They were confident they had found the right solution for stemming the flow of immigration.
How wrong they were again.
By some estimates, over a thirty-year period (1965-1995) the 1965 reforms were responsible for an additional 40 million people coming to the United States. The vast majority of those immigrants now come from Asia, Africa, and South America. Many of the immigration issues being debated today are a direct outgrowth of the unintended consequences of the 1965 Immigration Act.
It is possible that the health care legislation that president signed, and that the Supreme Court has now ruled constitutional, will avoid falling victim to the laws of unintended consequence. But history suggests otherwise. President Obama has said that health care reform will be his legacy. Whether it’s the legacy that he anticipated remains to be seen.
Steven M. Gillon is the Scholar-in-Residence for The History Channel. He is the author of That’s Not What We Meant To Do”: Reform and Its Unintended Consequences in Twentieth-Century America. This post first appeared at the Huffington Post.

Related Posts

Health Insurers & the Affordable Care Act: Extinction or Reinvention?
Health Care Future Bright for Nurses. Stinks for Doctors.
Are Fewer People in MA Paying the Individual Mandate Penalty?

Article taken from The Health Care Blog - http://thehealthcareblog.com
URL to article: http://thehealthcareblog.com/blog/2012/07/25/health-care-reform-and-the-laws-of-unintended-consequences/

The new paternalism in American medicine

It has taken me awhile to get to this article by Hartzband and Groopman, "Rise of the Medical Expertocracy," from the March 31, 2011 Wall Street Journal.  If you happened to miss it, it is quite thought-provoking.

Whether you are coming from the left or right perspective on health care reform, there is an underlying singular assumption that there is a "best practices" or "evidence-based solution for every difficult problem in medicine and health care delivery.  This may be naive wishful thinking or a zealous belief in the power of science, but, either way, this assumption is pervasive amongst physicians, "experts" in various medical disciplines, as well as politicians and policymakers.  I aver that this is a pernicious and dangerous assumption for both medical practice and health care policy.

One interesting part of this article is the authors' discussion of the results of their study interviewing how patients process and act upon "expert" advice and information.  Perhaps not surprisingly, there is indeed a wide range of how patients make medical decisions--which is also reflected in the range in how members of expert "consensus" panels also view the same evidence and arrive at different, indeed, opposite conclusions.

The authors' observation of the rise of the industry supplying metrics and report cards to doctors, health plans and hospitals is particularly insightful--and disturbing.  How much of the health care dollar goes to companies measuring and benchmarking health care hospitals' own data?  I know my hospital spends a lot--as well as spending on how to remediate or improve to get where the experts say we need to be in the 90th percentile.  To me, this seems to stifle the trial-and-error, locally-based approach that might truly provide innovation that could be appropriated or adopted elsewhere.

I will confess an inherent skepticism and distrust of experts (especially those panels that are buddy-appointed), but the authors make what should be obvious points:

For patients and experts alike, there is a subjective core to every medical decision. The truth is that, despite many advances, much of medicine still exists in a gray zone where there is not one right answer. . .Patients and doctors can differ with experts and not be ignorant or irrational. Policy makers need to abandon the idea that experts know what is best. In medical care, the "right" clinical decisions turn out to be those that are based on a patient's goals and values.

Analyzing Malpractice Claims to Reduce Errors--a pathologist's perspective

The Informed Patient column by Laura Landro from yesterday's Wall Street Journal (September 27, 2010) has an interesting report entitled, "What the Doctor Missed" which discusses how analysis of malpractice claims is informing efforts to improve medical practice.

The issue of diagnostic errors due to missed or delayed diagnoses should be of particular interest to pathologists.  The article doesn't explicitly state this but poor communication (patient-to-physician, physician-to-patient, PCP-to-physician/specialist, etc.) seems to me a major factor in lawsuits and a major contributing factor in diagnostic errors.  How can we more effectively communicate our findings to non-pathologists?  I especially note reference the article makes to breast cancer.  We routinely use histological diagnostic terms--that can have crucial implications for patient care with respect to appropriate follow-up and risk assessment--which can bewilder even experienced surgical oncologists and radiologists.  An example from breast cancer would be communicating the spectrum of "columnar cell lesions."  If we identify this in a core biopsy for a mammographically-detected abnormality, do we routinely communicate any assessment of risk for concomitant or future cancer?  Is that the responsibility of the pathologist?  In a broader view, what is our responsibility in ensuring that physicians "receive" actionable lab results?  Can we design systems that can prevent errors "of omission" that result from missing critical lab information within a critical period?  A blogpost isn't sufficient space to devote to an in-depth discussion of these questions but the problem is more complicated than just mere documentation.

This is just some appetizers for consideration.  I wonder if one of the subjects we are missing in medical school might be communication (i.e., rhetoric and semiotics)--not just making PowerPoint presentations but I'm talking about how to talk to people (all different kinds of people), how to assess what they've heard or understood, and (perhaps most critically) how to listen.

Impact of Reform on Health Insurance

A couple of timely articles that I came across today regarding unanticipated consequences already beginning to emerge following passage of reform legislation of U.S. healthcare earlier this year.  The first from strategy+business (Harvard Business Review) is interesting in its take on the system possibly evolving to a more "consumer-centric" system (as opposed to the current system where plans are marketed to employers).  The second is a more pessimistic long-term view on the overall costs of healthcare.

strategy+business

WSJ

Aetna Inc., some BlueCross BlueShield plans and other smaller carriers have asked for premium increases of between 1% and 9% to pay for extra benefits required under the law, according to filings with state regulators.

These and other insurers say Congress's landmark refashioning of U.S. health coverage, which passed in March after a brutal fight, is causing them to pass on more costs to consumers than Democrats predicted.

 

Low expectations for future of clinical data mining--a study

I picked this up from Fierce Health IT newsletter:

Anvita Health commissioned a newly released HIMSS Analytics study on clinical data mining. HIMSS Analytics convened a focus group of CMOs and and CMIOs of provider and payer organizations for the report.

Payers and providers alike generally don't often employ clinical data for real-time decision-making, in part because information is in so many disparate formats, some important data elements are missing and because they believe the costs generally outweigh the benefits. "These challenges are consistent with what we've seen and heard from our payer and provider customers," Noffsinger explains. "Interoperability of data is a hurdle, but it's not insurmountable."

"A key finding for us was that both payers and providers had limited expectations for how clinical analytics could improve the quality of patient care--especially at the point of care--and lower costs through that improved quality," Richard Noffsinger, CEO of San Diego-based data analytics firm Anvita Health, says, Healthcare IT News reports. "Comprehensive real-time analytics can take these stakeholders beyond just evaluation, and provide a blueprint for action by physicians, care managers and others in the care continuum."

One of the promises of the Health Care "Reform" bill rammed through Congress is that (unfunded but mandated) improvements in and use of health care information technology will lead to improved health and lower costs.  What is interesting to me from this study is the "limited expectations" that both payers and providers have for data mining for routine clinical use.  Such low expectations could lead to a "feedforward" feedback on the implementation of health IT creating a self-fulfilling prophecy where low expectations for IT improving quality of care leads to underutilization which fulfills the lower expectations, etc.

Here is the link to Health Data Management which has a link to a pdf of the study.

Disruptive Integration and Health Care

When Disruptive Integration Comes to Health Care

Posted using ShareThis

Interesting article containing an interview with Dr. Jason Hwang co-author of The Innovator’s Prescription: A Disruptive Solution for Health Care (McGraw-Hill, 2009).

It got me thinking about niches where "disruptive innovation" may occur in laboratory medicine and pathology.  Please share any thoughts you may have--let's get a conversation started about this!

One area is lab testing for wellness or serial monitoring of chronic diseases managed on an outpatient basis.  The traditional hospital-based lab (like mine) just has not evolved to meet these needs.  Your lab may still be focused on inpatient lab testing.  Outreach efforts may want to incorporate marketing for these niches.

Another niche might be for outside or independent "second-opinion" diagnosis utilizing digitized slides either transmitted electronically or (so '90s!) dropped onto a CD-ROM.

Word!

Digital pathology article in "CAP Today"

Dr. Keith Kaplan at Digital Pathology Blog pointed this one out as a good article discussing the recent FDA meeting regarding whole-slide imaging (WSI) technology.  And he has some informed insights quoted in the article.  The online version of CAP Today has been out and I (again) urge you to check it out--although the hard copy version is probably sitting on your desk somewhere.

I reckon that you're take on this article might depend on your reaction to the quote from Ole Eichhorn ot Aperio:

"Eichhorn believes that the FDA fears that if it doesn't "get out in front" of digital pathology, there could be a proliferation of non-cleared/non-approved WSI systems "because these devices are useful and valuable.  By the way, that's what we have with the microscope"."(my emphasis)

If a device is already "useful and valuable" (as judged by me, a practicing pathologist or as judged by the marketplace of laboratories and pathologists), shouldn't the FDA just let us use these for making our diagnoses--like we already do with microscopes?  As in golf (with a similar governing body deciding what is allowable equipment and what is not), it's not the club, it's the player that makes the shot and records the score.  If I'm a crap player (okay, I admit it), it won't matter whether I have an approved or non-approved club, ball, grip-warmer, etc.--I'll still be a crap player!  The imager and software is NOT making the diagnosis, the pathologist is!  And I'll freely admit that the instrument/software might (sorry, I'd still like proof) be better at counting stainable events at statistically important cut-offs or at least doing it faster.  BUT I would also submit that whether a breast cancer is positive for ER at 21.38% or 25% to 50%, the clinician is going to look at my Allred score to determine treatment (sorry, Keith, that's where I slightly disagree with your statement as it is in the article).  The "precision" offered by these instruments for this use is a little disingenuous and adds a patina of "scientificity" that really isn't that clinically meaningful.

If the FDA wants to collaborate with CAP and industry groups to provide guidance on how we should validate these instruments in our own labs, I'm definitely on board with that. 

I think too that you really have to also keep in mind the various people at the table and ask what their own vested interests are in this process--not that I'm cynical or anything, but still. 

It seems that the CAP has taken a reasonable position, as articulated by Dr. Valenstein, but I would like to review the actual consensus position--which I cannot find on our (the CAP) website.  Can anyone else?  We really need real pathologists out there expressing their opinions on this stuff to the CAP and to these regulatory agencies.

Health reform revisited

I can't resist referring to Dr. Keith Kaplan's post today at Digital Pathology Blog which reprints a column from Mike Royko, a famous syndicated Chicago columnist.  Boy, I really miss his columns, although Jon Kass has admirably done a good job following Royko at the Chicago Tribune.  Great find, Keith!

Hey Buddy, can you spare some change?

Not my usual but this is getting ridiculously serious.

From The Wall Street Journal, July 17, 2009:

WASHINGTON -- Congress's chief budget scorekeeper cast a new cloud over Democratic efforts to overhaul the nation's health-care system, telling lawmakers Thursday that the main proposals being considered would fail to contain costs -- one of the primary goals -- and could actually worsen the problem of rapidly escalating medical spending.
"We do not see the sort of fundamental changes that would be necessary to reduce the trajectory of federal health spending by a significant amount," Douglas Elmendorf, director of the Congressional Budget Office, told the Senate Budget Committee. "On the contrary, the legislation significantly expands the federal responsibility for health-care costs," he added.

At least someone is kicking the tires of this lemon.  Economics as a science has gotten a bad rap by some because it common sensibly attempts to explain 1) reality (or at least real things) and 2) human nature--both of which the (our?) politicians desperately want to ignore.  The emerging era of molecular-based "personalized medicine" will inevitably cost more (not less)--it's not one size fit all (or, uh, none).  Think Henry Poole & Co. (Savile Row, London) versus K-Mart for your tuxedo needs or Widmer Hefeweizen (oh yeah) versus Black Label.  Perhaps if we used the terms "hand-crafted" medicine or "fair-trade" medicine or "designer" medicine more people might understand this--like when they go to Whole Foods or Bergdorf Goodman.  As for "savings" for increased screening and preventive medicine?  This notion ignores the bulk of the medical literature from the past 5-6 decades that (stubbornly) and repeatedly shows that almost all screening is not cost-effective.  Of course, anyone who has taken their car to the dealership for that 60,000-mile maintenance service (like me!) could tell you this (try leaving without a list of things on the car that could go out any day).  I'm just sayin'.