Reconciling different visions of our healthcare system

Oct. 21, 2016 / By Richard Fuller, MS, Norbert Goldfield, MD

The conservative columnist Charles Krauthammer opined in a recent Washington Post editorial: “The Democrats will eventually push to junk Obamacare for a full-fledged, government-run, single-payer system. Republicans will seek to junk it for a more market-based pre-Obamacare-like alternative.”.

The Affordable Care Act (ACA), according to research by the Kaiser Family Foundation, has resulted in significant reductions in the numbers of uninsured, primarily through Medicaid expansion.  Significant numbers of the uninsured (unsurprisingly) reside in states that chose not to expand Medicaid coverage. Payment for the expansion of Medicaid under the ACA has fallen disproportionately on the federal government (100 percent for the first three years, with no less than 90 percent thereafter) making federal oversight of both Medicaid and Medicare even more dependent upon extracting efficiencies from the healthcare system.

Yet the growing pains for the ACA are unmistakable. Dartmouth Medical Center’s recent decision to drop out of the Medicare Pioneer Accountable Care Organization (ACO) demonstration highlights the challenge. As a New York Times article pointed out: “An evaluation for the federal government found that Dartmouth’s accountable care organization had reduced Medicare spending on hospital stays, medical procedures, imaging and tests. And it achieved goals for the quality of care. But it was still subject to financial penalties because it did not meet money-saving benchmarks set by federal officials…It’s hard to achieve savings if, like Dartmouth, you are a low-cost provider to begin with.”

The heart of the challenge is the manner in which CMS has implemented the vast majority of its initiatives tying payment to improved quality. As we at 3M HIS Clinical and Economics Research have maintained throughout the publication of this blog, CMS could easily address these issues by focusing ALL their payment-quality initiatives on a small (i.e. ten or less) number of outcomes measures that are tied closely to improving financial efficiency.  Detailed and transparent risk adjustment (needed for the validity of an outcomes measure) and clarity of communication (What do I need to do to succeed?) are essential elements that should be incorporated into incentives for stimulating behavioral change.  

We also need to keep in mind that the CMS approach has a spillover effect on to the states (in particular, state Medicaid programs) that are implementing thousands and thousands of initiatives without a clear framework within which to assess whether the state’s or CMS’ programs are having any impact. Compounding this challenge, as we’ve also pointed out in these blogs and in scientific articles, is that CMS is requiring thousands of haphazard measures many of which are simply inaccurate. This leads, in particular, to discrimination against institutions, especially safety net institutions1.

What outcomes measures do we recommend? In previous blogs we’ve discussed Potentially Preventable Events (PPEs)2. There is also excellent evidence indicating that patient/consumer confidence or activation is not only important for consumers, but also stimulates the lower costs craved by regulators3. Mortality, especially for sicker populations, is an important measure. Lastly, John Auerbach recently wrote a paper in the Journal of Public Health Management and Practice in which he highlights community-wide public health interventions that resulted in improved outcomes such as decreasing childhood obesity and decreased smoking rates4.

By nature, the researchers at 3M HIS are incrementalists. We try to contribute to the conversation by tying improved outcomes quality to the need to control healthcare costs in a focused, coherent manner without prescribing specific clinical practices to practitioners. We see this as a means to bridge the gap between political parties, which Krauthammer highlighted, by focusing upon what is central to both. In that spirit, we would like to bring to our readers’ attention a bipartisan bill (H. R. 6274) that Congressmen Paulsen, Marchant and Kind introduced in Congress recently . We believe that this proposed legislation begins the process of bridging the gap between the different political parties’ perspectives. The bill replaces the existing readmission and complication programs with an approach that addresses the fact that, for example, the penalties in the current system can be out of proportion to the difference in performance of a hospital.  Future blogs will delve into greater detail of this and other similar bills. For now we would like to highlight the importance of focusing on a small number of outcomes measures as the key to reconciling differing political party visions.

Richard Fuller, MS, is an economist with 3M Clinical and Economic Research.

Norbert Goldfield, MD, is medical director for 3M Clinical and Economic Research.

  1. Atkinson G, Giovanis T. Conceptual errors in the CMS refusal to make socioeconomic adjustments in readmission and other quality measures. J Ambul Care Manage. 37(3):269-272. doi:10.1097/JAC.0000000000000042. Averill RF, Hughes JS, Fuller RL, Goldfield NI. Quality Improvement Initiatives Need Rigorous Evaluation: The Case of Pressure Ulcers. Am J Med Qual. 2016 Aug 30 Fuller RL, Goldfield NI, Averill RF, Hughes JS. Is the CMS Hospital-Acquired Condition Reduction Program a Valid Measure of Hospital Performance? Am J Med Qual. 2016 Apr 1
  2. Goldfield N, Kelly WP, Patel K. Potentially preventable events: an actionable set of measures for linking quality improvement and cost savings. Qual Manag Health Care. 2014 Oct-Dec;23(4):280-6
  3. Wasson J, Coleman EA. Health confidence: an essential measure for patient engagement and better practice. Fam Pract Manag. 2014 Sep-Oct;21(5):8-12. Green, J et al. When Patient Activation Levels Change, Health Outcomes And Costs Change, Too Health Aff March 2015 34:3431-437
  4. Auerbach, John The Three Buckets of Prevention, Journal of Public Health Practice 22(3) 125-128. 2016