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ACA repeal could kill innovative programs at hospitals

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The Republicans’ promise to repeal the Affordable Care Act not only threatens to deprive millions of people of their health insurance; it could drive many hospitals deep into debt and destroy innovative programs created by the ACA aimed at  improving patient care.

Timothy Ferris, M.D., an internist and medical director of the Mass General Physicians Organization, told FierceHealthcare that he worries that the “progress we’ve made over the past five years would be threatened.”

He said that  includes programs through the Accountable Care Organization (ACO) at Massachusetts General Hospital, including experiments with video consultations and home hospitalization.

Dennis Keefe, head of Care New England, in Rhode Island, told NPR that he is concerned about the future for Integra, an ACO that includes primary- care physicians, specialists, urgent-care and after-hour providers, clinics, laboratories and inpatient facilities.

Hospitals and healthcare systems that have spent the last six years trying to create new value-based, patient-centered models as part of the ACA.  And so 120 organizations sent a letter to President  Trump and Vice President Pence urging them to not roll back progress they have made.

To read more, please hit this link.


Price vows to protect people with pre-existing conditions

 

Republican Congressman Tom Price, M.D., President Trump’s nominee to run the U.S. Department of Health and Human Services, told the Senate Finance Committee  on Jan. 24 that he wants to ensure  that people with pre-existing conditions have access to health insurance, though he did not specify how this would work under the Trump administration’s plan to kill the Affordable Care Act.

Dr.  Price, a Georgia orthopedic surgeon, said “nobody ought to be priced out of the market for having a bad diagnosis.”

“I commit that we will not abandon individuals with preexisting illness or disease.”

One of the ACA’s most popular parts is the ban on insurers using patients’ pre-existing conditions to deny them coverage.


Canadian physician warns of Medicaid block-grant effects

 

Roger Chafe,  M.D., an associate professor of medicine at Memorial University of Newfoundland, says  the Trump administration idea of replacing the current state-federal sharing of Medicaid costs with block grants to the states won’t work well. He says a similar system was tried and flopped in Canada. Among his remarks:

“Canada offers an example of some of the potential impacts a move to block-grant funding would have, particularly for state governments. For American advocates of expanding access to healthcare, Canada’s experience should be troubling.”

“Perhaps more concerning for state governments is that block grants offer the federal government an easier and quicker mechanism for reducing its contribution than could occur under any cost-sharing arrangement. Several times since Canada’s federal government moved to block grants, it has unilaterally lowered its contribution, leaving the provinces to deal with the consequences.”

“In the U.S., the burden of covering unexpected cuts in federal contributions would likely be borne by Medicaid recipients, who could face stricter program eligibility, higher co-pays or reductions in benefits; by providers, who could face reductions in reimbursements or increases in their costs for uncompensated care; or by state governments, through increases in taxes, reductions in other expenditures or increases in debt.”

To read his piece in governing.com, please hit this link.


HHS nominee got sweetheart deal from biotech company

 

By JAY HANCOCK and RACHEL BLUTH

For Kaiser Health News

When tiny Australian biotech firm Innate Immunotherapeutics needed to raise money last summer, it didn’t issue stock on the open market. Instead, it offered a sweetheart deal to “sophisticated U.S. investors,” company documents show.

It sold nearly $1 million in discounted shares to two American congressmen sitting on House committees with the potential power to advance the company’s interests, according to company records and congressional filings. They paid 18 cents a share for a stake in a company that was rapidly escalating in value, rising to more than 90 cents as the company promoted an aggressive plan to sell to a major pharmaceutical company. Analysts said the stock price could go to $2.

One of the beneficiaries was Rep. Tom Price, M.D., a Georgia Republican poised to become secretary of the Department of Health and Human Services, which regulates pharmaceuticals. Price told HHS ethics officials last Thursday that if appointed, he will divest himself of the Australian stock as well as stock in about 40 other companies that could pose conflicts. He said he would sell within 90 days of appointment and abstain from any decision-making about companies in which he or his family has had an interest.

He has already seen about a 400 percent paper gain in his investment in Innate Immuno, stock trading records show.

The other and more substantial August investor was Rep. Chris Collins, a Republican from upstate New York, who along with family members owns about 20 percent of the foreign company. A key supporter of the president-elect, Collins sits on a key health subcommittee.

The outlines of the stock deal, first reported by The Wall Street Journal, resurrected concerns about powerful public officials gaining investment opportunities unavailable to the public, including from companies whose profits might be influenced by political decisions.

A review of corporate documents raises a more unusual aspect of the deal. Innate Immuno is a foreign company which, in documents and presentations, is explicit about a business strategy targeting the U.S. market, where the amount that can be charged for a new drug is generally far higher than in other countries.

Innate Immuno has hinged its strategy on winning a preliminary green light for a new multiple sclerosis drug, known as MIS416, from the HHS’s Food and Drug Administration. It says in its private placement offering documents that money raised in the U.S. will help it finance the FDA approval process, which can take years. Innate Immuno CEO Simon Wilkinson could not be reached for comment.

Price’s financial disclosures show that he acquired his first small stake in Innate Immuno in January 2015, investing about $5,000. He made two more small purchases in the company that year, declaring a small loss on the stock in his 2015 financial disclosure.

His largest purchase was on Aug. 31, 2016, valued at $50,000 to $100,000, his disclosures show.

Government ethics experts said  that Price’s stake in Innate Immuno as it tries to develop a blockbuster drug would clash with his public duties, making divestiture mandatory.

While ethics rules for Congress are relatively relaxed, “the minute you go to the executive branch, it’s a lot stricter,” said Richard Painter, a University of Minnesota law professor who was President George W. Bush’s chief ethics lawyer.

“Dr. Price takes his obligation to uphold the public trust very seriously,” said Phil Blando, a spokesman for the Trump transition. He has “complied fully with all applicable laws and ethics rules governing his personal finances.”

 

Rep. Chris Collins, along with family members, owns about 20 percent of Innate Immunotherapeutics. (Courtesy of the Congressional Directory)

Innate Immuno told investors it would seek “investigational new drug” status from the FDA, which could shorten the approval process. The FDA would not confirm this week whether the company has filed an application.

The drug is in a small clinical trial in New Zealand due to end in April. MS drugs are especially expensive for patients, costing $5,000 a month or more.

Positive trial results could set the stage for Innate Immuno’s stock to reach $2, said Australian stock analysts. In that scenario, Price’s investment of between $50,000 and $100,000 would be worth between $555,000 and $1.1 million. House financial disclosures require reporting of ranges of value but not specific amounts.

“You could easily picture a drug that is in the billions of dollars in revenues, but that’s assuming the [trial] data is there,” said David Blake, an analyst at Bioshares, a newsletter covering Australian life sciences stocks. “It’s really got to deliver.”

A physician who chairs the House Budget Committee, Price also sits on the House Ways and Means Committee and the Congressional Health Care Caucus. He has a history of contacting the FDA on behalf of industry campaign donors.

His ownership of Innate Immuno while serving in the House creates its own appearance of a conflict of interest, ethics authorities said.

“There is an appearance problem … to have members of Congress buying and selling stocks that are affected by the work of the committees they sit on,” Painter said. “It could be perfectly legal, but it looks terrible and shows lack of judgment.”

Price’s Innate Immuno stake is one of more than 40 companies he identifies as potential conflicts with the HHS job, including stock in Pfizer, Eli Lilly and Bristol Myers Squibb.

Collins, who sits on Innate Immuno’s board, has been a major shareholder in the company since 2011 and has gradually increased his family’s holdings to about 20 percent, corporate documents show. His investment in the private placement last summer was worth $720,000, according to regulatory documents.

“Congressman Collins has followed all ethical guidelines related to his personal finances during his time in the House and will continue to do so,” said spokesman Michael McAdams.

All told, including Price, Collins and other U.S. investors, the sale raised $1.8 million. In addition to funding the FDA approval process, the company said it would use the money to finance the clinical trial and develop potential manufacturing for the drug.

All U.S. investors in the August deal received a 12 percent discount to the stock’s market price at the time, which is not unusual in private placements, said Stuart Glazebrook, a biotech analyst for Gordon Capital Research, a securities research company in Melbourne, Australia.

For small companies, private issues can be more efficient than selling new public shares, he said. Selling at less than the market price raises odds of attracting investors, he said.

“It’s an incentive,” he said. “It’s like Amazon offering 20 percent off today only if you commit today.”

Ethics rules for FDA officials are especially strict, said Joshua Sharfstein, a former agency deputy commissioner.

“For the agency’s leaders, even holding onto a single share of stock in a regulated company is prohibited,” he said.

A decade ago FDA Commissioner Lester Crawford resigned and pleaded guilty to two criminal misdemeanors after being charged with concealing stock ownership in food and drug companies the agency regulated.

Innate Immuno executives have talked openly about selling the company to one of a number of pharmaceutical company suitors if its clinical trial is successful. Many small pharmaceutical companies with hot drugs go that route, reaping shareholders millions in quick profits.

The larger company would have the deep pockets to invest in more clinical trials that might be needed to obtain regulatory approval, analysts said.

Christina Jewett contributed reporting.


Reviewing Oregon’s big Medicaid expansion

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Mt. Hood, in Oregon’s part of the Cascade Range.

Here’s a look at Oregon’s much-watched high-risk, high-reward Medicaid expansion, which was launched by former Gov. John Kitzhaber, M.D.

To read the Health Affairs piece, please hit this link.


ER staffing change roils Summa Health

 

 

 

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More than 250 physicians from Summa Health System demanded that its president and CEO, Thomas Malone, M.D., and other leaders resign after  a controversial decision to change emergency room staff.

The Akron, Ohio-based health system brought in a new physician group, US Acute Care Solutions, to staff the ER on New Year’s Day after the contract with Summa Emergency Associates expired.  Summa Health gave less than a week’s notice of the change.

Physicians voted to reinstate Summa Emergency Associates and voted “no confidence” in Dr. Malone and the rest of the system’s leadership.

However, not all physicians agreed with the vote, the Akron Beacon Journal reported.  Some physicians supported Dr. Malone and said that physicians against the staffing change weren’t acting in the best interests of patients.

Amidst the controversy, a matter of a potential conflict of interest came up. The CEO of US Acute Care Solutions, Dominic Bagnoli, M.D., is married to Vivian von Gruenigen, M.D., Summa Health’s chief medical officer.

But the system said Dr. von Gruenigen was not involved in the decision to bring in USACS.

To read the  Beacon-Journal story, please hit this link.


Trump’s HHS pick dislikes Medicare bundles program

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By RACHEL BLUTH

Kaiser Health News

A recent change in how Medicare pays for joint replacements is saving millions of dollars annually — and could save billions — without impacting patient care, a new study has found. But the man whom Donald Trump has picked to be the secretary of  the Department of Health and Human Services has vocally opposed the new mandatory payment program and is likely to revoke it.

Under the new program, Medicare effectively agrees to pay hospitals a set fee — a bundled payment — for all care related to hip- or knee-replacement surgery, from the time of the surgery until 90 days after. Traditionally hospitals collect payments for many components of care and rehabilitation individually.

Tom Price, M.D., the president elect’s HHS nominee, a congressman from Georgia and a very affluent orthopedic surgeon, has actively opposed the idea of mandating bundled payments for these orthopedic operations, calling it “experimenting with Americans’ health,” in a letter to the Medicare agency just last September. In addition, the agency which designed and implemented the experiment, the Center for Medicare and Medicaid Innovation, was created by the Affordable Care Act to devise new methods for encouraging cost-effective care. It will disappear if the act is repealed, as President-elect Trump has promised to do.

The study appeared Jan. 3 in the Journal of the American Medical Association. Though one of its authors is Ezekiel Emanuel, M.D., a professor at the University of Pennsylvania who helped design the ACA, the research relies on Medicare claims data from 2008 through mid-2015, long before the presidential election.

Starting in April 2016, CMS required around 800 hospitals in 67 cities to use the bundled payment model for joint replacements and 90 days of care after the surgery as part of the Comprehensive Care for Joint Replacement program. The program had previously been road-tested on a smaller number of hospitals on a voluntary basis, which formed the focus of the research.

The study found that hospitals saved an average of 8 percent under the program, and some saved much more. Price has been skeptical that bundled payments did save money, but the researchers estimate that if every hospital used this model, it would save Medicare $2 billion annually.

The bundled payment program works like this: For some specific kinds of medical procedures, including joint replacements or some heart surgeries, the Centers for Medicare & Medicaid Services will add up the costs for the entire episode, from the hospital stay and medical supplies to the rehabilitation afterwards. If the total costs are below a target set by CMS, the hospital gets to keep the savings. If not, the hospital has to pay Medicare the difference. It’s supposed to incentivize more efficient spending and better care coordination between providers, so they can lower costs.

In practice, it seems to be working. Baptist Health System, a network of five hospitals in San Antonio, saved an average of $5,577 on each joint replacement without sacrificing the quality of care, according to the study. Baptist was an early adopter of bundled payments; it began experimenting with them in 2008. Over seven years, the hospital system has cut Medicare’s costs on knee replacements by almost 21 percent.

The savings came without impacting quality. Patients at Baptist Health System were just as likely to be readmitted to the hospital or end up in the emergency room as patients nationally. There was some indication that quality of care may be better, fewer patients under bundled payments had long, extended hospital stays.

In Price’s letter from September, he said that Medicare had exceeded its powers in imposing such bundled payments, which he said took decisions out of the hands of doctors and patients.

That doesn’t seem to be the case, according to Amol Navathe, M.D., an assistant professor of medicine and health policy at the University of Pennsylvania, and one of the authors of the JAMA study. Instead, Navathe and his colleagues suggest that the bundled payments actually fostered greater collaboration between surgeons, administrators and patients because programs could only succeed in saving money if physicians were engaged in creating standardized pathways for care.

For example, the Baptist Health System saved about 30 percent on implant costs, around $2,000 on each artificial joint, by using the least expensive medically equivalent implants as determined by the hospitals’ surgeons.

Usually, physicians are prevented from benefitting when hospitals save money because of anti-kickback laws. Waivers under bundled-payment models mean that surgeons can put in the time to find the best, most cost-effective implants, and share in some of that savings.

“It takes that extra level of effort and coordination, and proactively communicate with [patients],” Navathe said. “Preplanning, setting of expectations and communicating up-front is resource intensive, when they have the incentive to do that they were willing to expend the extra resources to make that happen.”

When bundles included care after a patient’s hospital stay, spending on rehabilitation went down 54 percent. That’s because hospitals took the time to match patients to the right level of care, Navathe said.

Patients who didn’t need to stay in a nursing home or rehab center were set up with home health care or physical therapy.

Price has objected to CMS making bundled payments mandatory, calling it an instance of federal overreach. But bundled payments only work if everyone has to participate, according to Darshak Sanghavi, M.D., the former director of prevention and population health at the Center for Medicare and Medicaid Innovation.

If hospitals can choose whether or not to participate, only the ones that are already delivering care efficiently –and coming in under CMS’s cost target — will use bundles and Medicare will constantly be paying out bonuses. The system needs to be mandatory, Sanghavi said, to pull in less efficient hospitals and give them incentive to change.

“Stopping the programs for ideological reasons I think impedes innovation in a way that is going to consign us to having really, really high costs of care that’s going to continue in the future,” Sanghavi said.

Bundled payments aren’t just for hip and knee replacements. On Dec. 20, CMS announced it would expand mandatory bundled payments to treatments for heart attacks, bypass surgery and cardiac rehab beginning in July 2017. In its waning days, the Obama administration is effectively throwing down the gauntlet to the incoming administration on bundled payments, one of its signature reforms.


5 suggestions to advance personalized medicine

 

Among their ideas:

  1. “Before {the patient meets}  with the clinician, a member of the care team  {should} assesses the patient’s level of engagement and capacity for self-management, so that the patient can participate in his or her care in a meaningful way. As part of that process, the patient completes a self-assessment of health needs, preferences, and goals by telephone, electronically, or in person. Through the medical record, this information is conveyed to the clinician before or at the time of the appointment.
  2. “The clinician assesses the patient’s health status and health risks using the best available conventional, genomic, and other precision diagnostic tools. Optimal risk-mitigation and therapeutic goals for the patient are identified.
  3. The clinician and patient set and clearly articulate shared goals, using the clinician’s health assessment and the patient’s self-assessment.
  4. “The shared goals are then incorporated into a personalized health plan that the patient is directly involved in crafting. The clinician chooses appropriate metrics for monitoring progress, identified explicitly for the patient; an electronic medical record is used for data collection and tracking.
  5. “The clinician coordinates care with the rest of the patient’s care team and arranges for appropriate follow-up.

“With this five-step process, the personalized health plan becomes a living, adaptable document — available to all team members — that is continually revisited in person, by phone, and/or via patient portals and mobile applications.”

To read their article, please hit this link.


Price might kill CMS mandatory bundled-payment experiments

President-elect Trump’s choice to head the U.S. Department of Health and Human Services (HHS), Georgia Congressman Tom Price, M.D., doesn’t like Medicare experiments in which  physicians, hospitals and patients must participate.

That suggests that four mandatory bundled-payment models just approved by the Centers for Medicare & Medicaid Services (CMS) are probably on a collision course with the incoming Trump administration.

If confirmed as HHS secretary,  Dr. Price, who has made no secret that he will be a strong advocate for the economic and other interests of his fellow physicians, may be able to erase or rewrite the final regulations for mandatory bundled payments, said Jack Lewin, M.D., president and chief executive  of the Cardiovascular Research Foundation, told Medscape. “And he’ll have the support of a majority of Congress.”

Still, Dr. Lewin said, Dr. Price may very well preserve the bundled-payment models, but make them voluntary. Whether they’ll work if only voluntary is uncertain.

“There will be physician organizations that are going to think maybe this is the way to go. We have {nonmandatory} bundled payments for cataract procedures. We have them for labor and delivery.”

To read more, please hit this link.

 


Value-based challenges of small practices

 

Kevin M. Fickenscher, M.D., in his blog titled The Fickenscher Files, discusses a General Accounting Office report on the challenges faced by small and rural physician practices in moving to value-based reimbursement systems.

The report discusses  practices with 15 or fewer physicians and/or those outside of  urban areas and defined the value-based models under five categories: financial resources and risk management; health IT and data; population-health management care delivery; quality- and efficiency- performance measurement and reporting, and the effects of model participation and managing compliance with requirements. 

Dr. Fickenscher writes that  from “the report and other initiatives that have been undertaken by the Centers for Medicare and Medicaid Services, it’s increasingly clear that the small and rural practices need ‘special’ attention and, that urban models do not necessarily translate easily to the outlying areas.  One of the biggest issues in the population health movement is how best to deliver such care when time and distance are major impediments for the care delivery programs.  For those who are interested in the roadblocks faced by these practices, the GAO report is a quick read and provides a blueprint on where the focus should be related to remedial steps in solving the problems.”

To read the report, please hit this link.

To read Dr. Fickenscher‘s blog, please hit this link.


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