Ilovebenefits’s Blog

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Moving from Fee for Services

Editor’s note: It is critically important that we move the reimbursement system from fee for services to fee for care. A movement in that direction is bundled services, but it has to be more than that. Payment has to involve information about efficient process, quality, and outcomes. Otherwise in the words of Demming, “If you only focus on the ends, you may get it in ways you never intended.”


Expert: U.S. is on path toward health care payment reform
More than a dozen health care payment reform efforts are under way around the U.S., according to Karen Davis, president of the Commonwealth Fund. She told a conference that the country is on a path away from fee-for-service and heading toward bundled payments that go beyond pay-for-performance models. Healthcare Finance News (3/12)


March 15, 2010 Posted by | healthcare, insurance, Plan design | , , , , | Leave a comment

John Goodman, Ken Thorpe, Uwe Rheinhardt

Editor’s note: a terrific piece by John Goodman with comments by some of the greatest minds in health care policy – debating some of the most salient points.


Writing in Health AffairsKen Thorpe and his colleagues offer a description of the current phase of the problem:

Medicare beneficiaries’ medical needs, and where beneficiaries undergo treatment, have changed dramatically over the past two decades. Twenty years ago, most spending growth was linked to intensive inpatient (hospital) services, chiefly for heart disease. Recently, much of the growth has been attributable to chronic conditions such as diabetes, arthritis, hypertension, and kidney disease. These conditions are chiefly treated not in hospitals but in outpatient settings and by patients at home with prescription drugs.

So how are we dealing with this challenge? Poorly.

Now read more and the various rebuttals…at:

March 10, 2010 Posted by | Chronic conditions, healthcare, innovation, insurance | , , , | Leave a comment

Overuse and Misuse

More PCT testing could reduce unnecessary antibiotic use
If physicians commonly tested patients for procalcitonin, or PCT, it would help them identify those whose respiratory tract infections respond to antibiotics and help prevent prescribing unnecessary drugs, researchers said. The study estimated antibiotic prescriptions for respiratory tract infections could drop by more than 40% if the simple test was used routinely. MSNBC/Reuters (2/25)

February 26, 2010 Posted by | drugs, healthcare, Overuse, quality | , , , , | Leave a comment

Re-Architecting Family Care

Texas group aims to upgrade family care
The 2-year-old Legacy Medical Village in Plano, Texas, boasts a family practice as well as a host of specialists who are taking advantage of technology to improve care. Some experts say the Village is a model project to watch as the nation looks for ways to provide more efficient and high-quality care at lower costs. The Dallas Morning News (12/27)

December 28, 2009 Posted by | Electronic health records, healthcare | , , , , | Leave a comment

Every Industry Goes Through Periods of Consolidation

Consolidation of doctors’ practices might help patients
Patients might benefit from consolidation of physicians’ practices that creates larger medical groups. Large medical groups tend to have more money than smaller or solo practices, allowing improvement to infrastructure and an upgrade to electronic medical records. They might also offer increased access to care. Chicago Tribune/Tribune Newspapers (12/24)

December 24, 2009 Posted by | healthcare, physicians | , , , , | Leave a comment

Looking for Ways to Make Health Care More Efficient

Editor’s note: Finding ways to extend physician skills in efficient and effective ways are critically important as health reform begins to take hold.


NowClinic to go nationwide with virtual office visits
NowClinic, which allows physicians and patients to have virtual office visits, is going nationwide, expanding a concept already used regionally. NowClinic will be rolled out state by state through OptumHealth, a division of UnitedHealth Group, which says the program can help expand access to care. The New York Times

December 21, 2009 Posted by | healthcare, physicians | , , , , | Leave a comment

Business Roundtable edges away from health reform plan

By: Jeanne Cummings
December 11, 2009 06:26 PM EST

Without fundamental changes to the current health reform plans, the White House and congressional Democrats risk losing the last major corporate group that is standing by their effort: The Business Roundtable.

In an interview with POLITICO on Friday, Roundtable President John Castellani raised concerns about the effectiveness of cost containment provisions in the proposal, and the timing of various fees and taxes that ultimately could be passed on to employers that provide insurance to workers.

“If these areas aren’t improved the reform effort will not work and we need something that works,” said Castellani.

Castellani wouldn’t say how long the group is giving Democrats to fix the bill, but said, “We are going to be much louder and much more insistent on improving” the legislation.

Castellani’s comments are significant because the White House, including President Barack Obama <> , has often contrasted the Roundtable’s cooperative role with that of the U.S. Chamber of Commerce, which is lobbying hard against the plan.

The Roundtable has 161 CEO members who oversee the largest corporations in America. Combined they have nearly $6 trillion in revenues and more than 12 million employees. They alone provide health care to more than 35 million workers and their families, which makes them one of the biggest stakeholders in the current debate.

By staying at the table, the Roundtable has lent credibility to arguments by congressional Democrats and the White House that the reform measure will not dramatically disrupt the private sector, or bring an end to employer-sponsored insurance programs.

In addition, the Roundtable’s mostly quiet engagement has given some cover to lower profile, but still influential, business trade associations who have also decided to not to fight the reform legislation.

The Roundtable’s hardening position came after a board meeting held in Washington this week. While the group discussed other legislative issues, “we kept coming back to this every time we had a chance. It consumed the preponderance of the day,” Castellani said.

No threats were made, he said, but it’s clear that the CEOs see the time coming when they may need to shift to a more aggressive position – either for or against the measure.

If the Roundtable becomes a hostile player, the White House and Congress could face a relentless wave of big-name CEOs on television panning the measure and, potentially, the mobilization of millions of workers against it.

“What our members decided is that they want us to continue to make this bill better. We will defer passing judgment on it, but it is not good enough” today, he said.

Senate Democrats and the White House sought to downplay the potential rift. “We are working through these issues with them and they are being very constructive,” said one White House official.

A senior Senate aide, likewise, noted that a package of amendments drafted by Sen. Mark Warner (D-Va.) and about a dozen other freshmen addressing some of the Roundtable’s concerns is already on the table.

Castellani applauded that measure, but outlined a list of desired changes that goes well beyond it.
Among the changes sought by the Roundtable regarding cost containment are:

• Access to data collected by the Centers for Medicare and Medicaid Services that can be used to identify cost-effective treatments, efficient hospitals and best performing physicians, which could help businesses develop more efficient and effective private insurance packages for their employees.

“Right now that data sits there and nobody has access to it,” said Castellani. “You know more about the cost and quality of a flat screen TV than you do about heart-bypass surgery.”

• An expansion of the authority of the proposed Independent Medicare Advisory Board so that it can search for cost savings in all health care sectors. The current legislation exempts some groups from scrutiny, including hospitals. In addition, the board should be charged to search for efficiency measures in the private sector that can replicated in the Medicare system.

• An acceleration and expansion of pilot programs aimed at changing the way Medicare reimburses doctors and hospitals by providing bundled payments to cover patient testing and consultations rather than paying for each service delivered, which critics say leads to unnecessary treatment.

All of those changes are aimed at driving Medicare costs down and ensuring that any proposed savings from that system aren’t simply shifted and extracted from private insurance policies holders.

Among the revisions the Roundtable will press for on the financing side of the reform measure, are:

• An exemption for self-insuring employers from a tax imposed on all insurance providers. The levy emerged at the 11th hour in the Senate deliberations. Castellani said some senators called to apologize “for the surprise.” The Roundtable argues that it should be exempt because corporations already are facing a tax on the so-called Cadillac insurance packages they may offer – and are already doing the right thing by offering insurance to their workers.

• An adjustment or bridge that would ease the cost squeeze caused by the timing of new fees and insurance reforms and the onset of new customers.

As written now, health insurers will be required to begin providing insurance without regard to previous health conditions as soon as the legislation is enacted.

In order to afford to do that, the industry needs revenue from the millions of new customers – many of them young and healthy -- that the legislation will drive their way.

However, Roundtable members worry that the penalty for not buying insurance is so slight that many healthy people won’t get insurance.

The proposed reform measure includes a sliding scale of fees – ranging from $95 for those who don’t buy insurance in 2014 to $750 in 2016.

Consequently, health insurers are likely to pass on the costs of treating any sicker new customers on to businesses that provide private insurance to their workers.

A similar lag between the influx of new customers and a new insurance product tax could prompt another shift of costs to the business sector, Castellani said.

He is urging senators to, among other things, require individuals to buy catastrophic insurance immediately.

In the interview, Castellani said the work by the Senate and the White House on these issues will drive the Roundtable’s ultimate decision on whether to endorse the measure or not.

Asked when the Roundtable may make its final assessment, Castellani demurred. “At some point we will either know that these objectives can’t be met or can be met,” he said, “and at that point we’ll make a decision.”

December 11, 2009 Posted by | Federal Government, healthcare | , , , , , , , | Leave a comment

Budget Director: No efficiencies for decades

Editor’s note: If we cannot get to an efficient system for decades if with health reform, what is the Budget Director saying about this healthcare overhaul package and the attendant costs? …Brace yourself for significant health care and tax increases. He is part of the White House team!


The White House budget director said Wednesday that it may take decades for America to have an efficient health care system even if Congress passes a major overhaul this year.

“It will be years to decades” before the nation has a properly working health care system that rewards quality over quantity, Peter Orszag told reporters. He said improving the quality of health care “is more like a lifelong nutrition or diet, not studying for an exam,” but he added that continuous progress is a crucial goal.

Orszag is one of President Barack Obama’s top aides in urging Congress to overhaul the U.S. health care system in the coming weeks. He acknowledged that many key elements of the pending House and Senate bills would not take effect for several years, but he urged Americans to embrace a gradual process.

December 3, 2009 Posted by | Federal Government, healthcare | , , , , , , | Leave a comment

Medical ‘Pay for Performance’ Programs Help Improve Care — But not Always, Study Finds
University of California – Los Angeles

November 24, 2009

Recent studies by The UCLA School of Public Health have found that California’s pay for performance program that was implemented in 2004, has greatly improved the overall experience of patient care.

However, the amount of improvement often depends on the incentive focus area. Too much focus on physician production may not lead to better health care while incentives used to focus on clinical quality and patient-clinician interaction seem to provide the best results.

For complete story, click here.

November 24, 2009 Posted by | healthcare, quality, Reimbursement | , , , , | Leave a comment

Fee For Care vs. Fee For Service

Research examines potential for savings with bundled payments Moving U.S. health care from fee-for-service to a system of bundled payments for providers is one of the best ways to control health care costs, according to Rand Corp. researchers. U.S. government estimates peg the savings at $1 billion a year, but the Rand team said applying the concept to six common chronic diseases would boost savings even higher.

November 12, 2009 Posted by | Health care delivery, healthcare, Reimbursement | , , , | Leave a comment