Jeff Goldsmith, writing in Hospitals & Health Networks, says that U.S. hospitals need to do more to address the growing epidemic of despair as reflected in the opioid epidemic and Americans’ declining life expectancy.
Mr. Goldsmith is national adviser to Navigant Healthcare and associate professor of public health sciences at the University of Virginia.
Death rates have risen for eight of the 10 leading causes of death in America. The life-expectancy decline was entirely in the under-65 population.
The obesity epidemic and other social factors would seem to be playing big roles.
Mr. Goldsmith writes: “It is going to take more than the ‘right incentives’ and a surge of healthcare consumerism to alleviate the despair…. While the new administration and Congress struggle with health reform issues, hospitals should directly address the ‘forgotten’ in their communities.”
Among his suggestions:
“Hook them up. A lot of the folks who end up in your emergency department for self-inflicted conditions will survive to fight another day. You may be able to save their lives, but your ED cannot fix the underlying conditions that brought them to you. What you can do is (1) listen to them, (2) gauge their readiness to address their problems, and (3) hook them up — to primary care, to Alcoholics Anonymous/Narcotics Anonymous, to weight loss programs, to rehab and recovery specialists, to mental health professionals, to churches or community agencies. Absent these connections, odds are that they will return to you with their problems unaddressed.”
“Advocate for continued coverage of mental health and substance abuse treatment.”
“Explore the psychiatric emergency services center. fast-growing, innovative form of care is an inexpensive, locked-unit, short-stay special hospital for people with acute psychiatric conditions, including drug problems. It is specifically geared to stabilization and detoxification of people in acute psychiatric distress and is often physically separate from the hospital. Such centers are proliferating and solve a significant problem: freeing up ED personnel to focus on the nonpsychiatric portion of their patient flow. Though it is still early days, some evidence from the field suggests that 80 percent or more of patients treated in PES are discharged to home. And because of the thorough workup they receive, the remaining 20 percent are matched to the right inpatient setting (acute, rehab, etc.) with much improved continuity of care.
“Lead your community’s economic development activities.
“The underlying cause of many of the health problems we have been discussing is a lack of economic opportunity. Do not rest until your hospital is not the largest employer in your community.”
Jeff Goldsmith, Ph.D., president of Health Futures Inc. and associate professor of public health sciences at the University of Virginia, says in a Hospitals & Health Networks piece that U.S. health-system performance has gotten better in recent years.
He gives a lot of attention to total hip replacements, wh0se “breakthrough” started in the mid-1970s.
“There has been no cure for arthritis since and, sadly, none appears even remotely likely. Rather, the real progress in total hip replacement came from continual refinement by the orthopedic community not only of hardware but also of clinical processes inside and outside the operating room.”
“Nor is this seemingly invisible progress through collective learning an isolated instance confined to orthopedics. Much has been made of the continued frustration in the search for a ‘cure’ for cancer and of the high cost of new cancer medications. The popular press neglects to mention that while we’ve been waiting for a ‘cure’ for cancer, there has been a nearly 25 percent decline in the age-adjusted death rate from cancer in the U.S. since 1990.”
“Though the disease remains scary for patients and their families, cancer treatment today is much less a ‘one off’ search for solutions than it was even a decade ago. Cancer care is increasingly protocol-driven, informed by a comprehensive and growing cancer registry maintained by a network of National Cancer Institute-designated community cancer centers. There has certainly been therapeutic progress for some forms of cancer, including a vaccine for cervical cancer, but the real progress has been an immense and largely invisible collective effort by the cancer community to harness the power of big data and clinical practice experience across millions of cases.”
And: “Stroke care today begins in the ambulance on the way to the hospital, and hospitals are publicly rated on the number of minutes that elapse between the moment the patient reaches the hospital’s front door and the time that catheter-driven therapy (coils or stents) addresses the cause of the stroke (e.g., bleeding or vascular blockage). Strokes are still a scary health risk, but a massive amount of suffering and brain damage today is avoided by more systematic and focused care. ”
“Though it is still the nation’s leading killer, deaths from heart disease have declined by two-thirds since 1970. This is despite the escalation of cardiac risk created by the obesity epidemic and the resulting sharp rise in the prevalence of diabetes. Absent these two linked developments, one suspects the decline in cardiac mortality would have been even more striking than what we have seen. Twin revolutions in invasive cardiac care — bypass graft surgery beginning in the early 1970’s and cardiac stenting in the 1990s — helped alleviate symptoms, while marked improvements in cardiac intensive care saved hundreds of thousands of lives after cardiac events. ”
One of the missions of the 2010 federal health law is to slow the soaring cost of health care. A key strategy for Medicare is encouraging doctors, hospitals and other health care providers to form Accountable Care Organizations (ACOs) to coordinate beneficiaries’ care and provide services more efficiently. Under this experimental program, if these organizations save the government money and meet quality standards, they can be entitled to a share of the savings. Participation is voluntary.
In August, Medicare officials released 2014 financial details showing that the so far the ACOs have not saved the government money. The 20 ACOs in the Pioneer program and the 333 in the shared savings program reported total savings of $411 million. But after paying bonuses, the ACOs recorded a net loss of $2.6 million to the Medicare trust fund, a fraction of the half a trillion dollars Medicare spends on the elderly and disabled each year.
To help put this development in perspective, Kaiser Health News posed this question to several ACO experts: Three years in, the ACO program has many success stories, but it’s not yet saving Medicare money. Is it working?
Here are their answers, edited for clarity and space.
Richard Barasch
Chairman and CEO of Universal American Corp, whose subsidiary, Collaborative Health Systems, operates 25 Medicare ACOs
The program started off slowly. Changing the behavior of doctors from fee-for-service to a value-based environment involves changing in some cases 30, 40 years of behavior and doesn’t happen overnight. It’s very, very hard work. The doctors who embrace it find it very challenging. Think about how it affects their entire practice.
For these things to work, it has to be not just a value-based conversation but it also has to be about how the practice is actually managed. For example, the program wants us to encourage Medicare beneficiaries to get annual wellness visits. Most doctors don’t think of their enterprise as a business with customers. They think of it as a practice with patients. And things like the marketing work to get people in for an annual wellness visit is something new to them. It’s not something that they would typically do. So the notion of once a year, calling their members and asking them to come in—not just sending a little three by five inch card – but proactively getting them into the practice turns out to be a new exercise for many. Nine of our ACOs earned $27 million in shared savings.
Components Of ACO Program
THIS MEDICARE ACO INITIATIVE HAS TWO PARTS:
The Medicare Shared Savings Program (MSSP), which is the largest group, is comprised of hospitals, doctors and other providers. It allows these organizations to opt against the risk of penalties for not meeting goals set by the program. But if they do that, they also are eligible for only lower shared savings.
The Pioneer Model is comprised of high-performing health systems. Groups in this program are eligible for higher levels of savings, but they must take on higher risks.
There’s another thing going on here too, and this is sort of interesting from the non-financial, behavioral viewpoint. The doctors want to do the right thing. We’re seeing a generational shift in how physicians view their practices—again with a little self-selection. They know that pay for performance is coming. Now they are being measured, and they want their scores high. They understand that the world is changing and there’s a little bit of self-selection in our group with doctors who want to change along with the system. And what we found remarkable in the 2014 reporting period, even the doctors who did not earn bonuses were quite happy with the quality scores that were generated around their practices.
They work hard to get their quality scores where they think they should be—and when they’re not, the doctors are very, very chagrined. Hospitalizations in 2014 decreased on average by 11 percent for beneficiaries with chronic obstructive pulmonary disease, for example, and by 8 percent for those with congestive heart failure.
They cared a lot about that, even though the money wasn’t there in this marketing period.
Robert Murray
President of Global Health Payment, a consulting firm that works on health reform initiatives, and former executive director of the Maryland Health Services Cost Review Commission
The recent results on ACO performance indicate that it hasn’t been successful. A lot of people have characterized the results as lackluster at best, and I think things are even worse than that. Medicare’s performance data ignores the fact that each of these ACOs made very substantial investments in infrastructure: new data systems, care management and care coordination systems that probably run anywhere between 1 and 2 percent of their target budget. If you apply that to the results of the ACOs, you would find that even a significant proportion of those meeting Medicare’s goals would be underwater financially.
The problems are largely based on design flaws. Because the formation of an ACO requires substantial levels of risk and large up-front infrastructure costs, they have been largely dominated by deep-pocketed health systems, hospital networks, large multi-specialty physician groups or other combinations of specialists and hospitals. However, these providers are unlikely to make aggressive attempts to control costs because the hospital and specialists are still being reimbursed under traditional fee-for-service payment model. For hospitals, which have high levels of fixed costs, the way to cover costs and earn profits is to generate more volume. Their incentives run directly counter to the goals of the ACO program, which are to reduce costs, to reduce unnecessary use of hospitals and high-priced professionals. The ACO model for these groups is akin to asking an overweight patient to eat his or her own flesh to become thinner.
CMS could correct these deficiencies by developing a new ACO model that features groups of primary care physicians (PCPs) as the key organizational building blocks. PCPs are at the center of care management activities for most Medicare beneficiaries and primary care is generally under-provided. Because PCPs account for a small share of total expenditures, it is possible to provide large financial incentives with modest shared savings proportions, perhaps 20 to 30 percent. However, because they account for a small share of total costs, PCPs are unable to assume financial risk. Therefore, a PCP-led ACO must include a mechanism to pay for reasonable infrastructure costs while retaining the upside-only risk characteristic of the current Medicare Shared Savings Program (MSSP). Each PCP group should also be eligible for a shared savings payment if it generates savings, regardless of the performance of the entire ACO.
Jeff Goldsmith
Associate professor of public health sciences at the University of Virginia and president of Health Futures, Inc., a health analytics firm
We are actually ten years in, not three. The ACO model was first tested in the Physician Group Practice demonstration, which began in 2005. The results of that demo greatly resemble those of the past three years: less than a fifth of the ACOs generate the vast majority of savings, and those failing to generate bonuses outnumber bonus winners three or four to one. Prominent among the “failures” are respected provider systems with decades of successful managed care experience in both the commercial market and Medicare Advantage. This isn’t a new idea.
You can make any program “work” if you employ Lake Wobegon accounting. Hire a friendly consultant to do your program evaluation, instead of a respected independent evaluator (how about the HHS Office of Planning and Evaluation?). Count the “savings” but ignore the overruns. Don’t count the bonus payments as a “cost.” Don’t count ACO set-up or operating costs (so we cannot determine the return on investment from participation). Don’t share the savings with Medicare beneficiaries. And voila, it “works.”
The CMS Innovation Center is a young agency with a very full plate. It has an audience, including Congress, health service research experts and the provider community.
Its leadership needs to establish its credibility in order for its innovations to take hold. Picking the ACO as its lead project was a bad decision, and one that has not enhanced the center’s credibility.
Michael Chernew
Professor of health care policy and director of the Healthcare Markets and Regulation Lab in the Department of Health Care Policy at Harvard Medical School
The existing data unambiguously shows that overall the Pioneer program saved a little bit of money for CMS. There should be two separate questions: One of them is before health care providers shared the savings, did they save Medicare any money? And is after they shared the savings, did they save Medicare any money? I actually think the first question is more important because it speaks to the long run savings and sustainability of the model.
Mike McWilliams and I, along with other colleagues published a paper that found the first year of the Pioneer program saved money by cutting spending by about 1.2 percent. But it saved money even after savings were shared. We don’t have enough data yet on the MSSP program to make judgments, but I wouldn’t conclude that they haven’t saved money.
I also speculate that over time we will see bigger savings and more organizations participate. Medicare has tweaked the rules to make the program more attractive to providers. In addition, ACOs can help providers get beyond the Affordable Care Act’s productivity adjustments that will reduce the rate of growth in fee-for-service payment rates to hospitals and other providers. The ACO model allows these organizations to transfer some of the efficiency gains they make into bottom-line savings. If they reduce admissions, if they reduce readmissions, if they reduce wasteful use of diagnostic services, they can keep some of those savings. When they keep those savings, it doesn’t look great if Medicare’s spending is higher than it would have been if the savings were not shared. On the other hand, the incentives of sharing helped generate the savings in the first place and they might allow those providers to survive.
We need to put the health system on a sustainable spending trajectory. Even though the Pioneer plans saved a relatively modest amount, we seem to be moving in a reasonable direction.
You don’t expect to get a lot of the savings early, but if you can get providers to do things that will control the rate of spending growth, over time you will get a payoff. What we need to do now is not worry about 2016, but worry about the health care system in 2025. I believe that looks better if we continue on this path. Moreover, the alternatives are not great.
I don’t mean that success is easy and I don’t mean to imply that all organizations will succeed. This is not without risk. I am personally a bit optimistic. But I don’t think success is a foregone conclusion. It is very hard for many organizations. Undoubtedly, some will fail.
Sean Cavanaugh
Deputy administrator and director of the Center for Medicare at the Centers for Medicare & Medicaid Services
CMS’ ACO initiatives are off to a successful start because beneficiaries are receiving measurably better care and the trust funds are saving money.
In the Pioneer Model and the Medicare Shared Savings Program, which collectively provide care to more than 8 million Medicare beneficiaries, ACOs improved care from one year to the next and consistently outperformed fee-for-service providers in areas where there are comparable quality measures. In the third performance year, Pioneer ACOs showed improvements in 28 of 33 quality measures and experienced average improvements of 3.6 percent across all quality measures. Shared Savings Program ACOs that reported quality measures in 2013 and 2014 improved on 27 of 33 quality measures. In addition, Shared Savings Program ACOs achieved higher average performance rates on 18 of the 22 Group Practice Reporting Option Web Interface measures reported by other Medicare fee-for-service providers reporting through this system.
In addition, an independent evaluation report for CMS found that the Pioneer Model generated more than $384 million in savings over its first two years, while the CMS Office of the Actuary has certified that an expansion of the Pioneer Model would be expected to save the trust funds additional funds. While the actuary has not opined officially on cost savings in the Medicare Shared Savings Program, the program’s financial results are in line with those that we expected. And early results show that ACOs with more experience in the program tend to perform better over time. Among ACOs that entered the Shared Savings Program in 2012, 37 percent generated shared savings, compared to 27 percent of those that entered in 2013, and 19 percent of those that entered in 2014.
Another sign of success has been the growth in interest in the ACO model. The Shared Savings Program now includes more than 420 Medicare ACOs serving more than 7.8 million Americans with original Medicare. The Shared Savings Program continues to receive strong interest from both new applicants as well as from existing ACOs seeking to expand and continue in the program for a second agreement period starting in 2016. Next year, CMS will launch the Next Generation ACO model, which has also garnered significant interest among providers.
ACOs are a part of our vision of a system that delivers better care, spends our dollars in a smarter way, and puts patients in the center of their care to keep them healthy.
“I have believed for years that healthcare management programs have underprepared their graduates for the complexities of even understanding, let alone managing, medical professionals,” who are, he half-jokingly says, different species.
He suggests that hospital executives learn this about the new class of physicians:
“For their entire training, they’ve been supervised by other physicians: the faculty ‘officer corps’ and the ‘noncoms,’ i.e., senior residents and fellows. They saw folks in suits in the halls {such as hospital executives}, but had the dimmest notion what the ‘suits’ actually did for a living. ”
And:
Younger physicians ”remain fiercely competitive and empirical.” ”They actually care about the people they are taking care of.”
”{W}with the possible exception of the pediatricians, they will never (a word I don’t use often) care about the people they are not seeing as much as they do about the patients in front of them. They will work hard to help their patients understand their role in their own health. But your physicians have been trained to take care of patients, not the rest of the community.” {Translation: Don’t get your hopes too high about physicians embracing population health.}
”They have learned a lot from watching their elders. There is a lot of discussion in medicine right now about how Generation Y doctors are different from their workaholic elders. Most younger physicians don’t want to practice 100 hours a week. …. Striving for work-life balance looks like wisdom derived from closely studying their {burned out} elders.”
”Don’t expect the best of them to stick around if you cannot adequately support their practices.”
“Don’t expect a lot of help reducing patient care costs.”
”If we expected employed physicians to actually reduce the cost of care, we’re learning sadly that their training has pointed them in a very different direction. Even younger hospitalists and intensivists have had trouble with more resource-sparing clinical decision-making. They will need to be retrained, and that will happen only with effective physician leadership.”
”Younger physicians are, however, team players, and far more comfortable practicing as part of a team than all but a handful of their elders. This bodes well for their willingness to adopt and practice evidence-based, protocol-driven medicine….But don’t expect them to practice protocol-driven medicine unless they feel the outcome is defensible based on available science.”
