Unbiased Analysis of Today's Healthcare Issues

Baskets of Care

Written By: Jason Shafrin - Apr• 22•13

What are the best practices for providing care for a specific condition?  This question is not easy to answer.  Further, the best practices for treating the average patient may differ from the best practice for treating certain other types of patients; particularly when a patient suffers from multiple conditions simultaneously.

Despite these challenges, this information can be used not only for quality monitoring but also to alter payment systems.  Specially, once the care relevant for the treatment of a specific condition is identified, payers can use this information to for the purposes of bundled payment.  In fact, the Minnesota Department of Health (MDH) has developed “Baskets of Care” to accomplish just this goal.  The MPH website states that:

Baskets of care are collections of health care services designed to treat particular health conditions or episodes of care. Offering these bundled services is a major reform in the way we pay for health care…Minnesota health care providers now have the option to voluntarily use baskets of care to deliver services. State law requires providers offering a state-designated basket of care to register with the commissioner of health.

MPH has developed 7 different baskets of care. These include:

  • Asthma (children) – Management of asthma as a chronic disease
  • Diabetes- Without co-morbidities, does include hypertension and hyperlipidemia
  • Low Back Pain – Management of acute episode of low back pain
  • Obstetric Care – Prenatal, uncomplicated vaginal delivery, cesarean section delivery
  • Preventive Care (adults)
  • Preventive Care (children) - Well child care, preventive care, normal newborn care
  • Total Knee Replacement – Inclusive management from preoperative phase through rehabilitation phase

I am not sure, however, how widely payers (or providers) use these baskets of care. Anyone from Minnesota have any feedback on this program?

Posted in Health Insurance, Quality, Supply of Medical Services , , | No Comments »

Medicare Part D Prescription Drug Enrollment Trends in 2013

Written By: Jason Shafrin - Apr• 22•13

According to research from Avalere, Medicare beneficiaries are overwhelmingly choosing low-cost Part D prescription drug plans . In 2013, more than 500,000 beneficiaries enrolled in the brand new AARP Saver Plus plan—catapulting it to a position in the top 10 list of plans in its first year. With the addition of Humana/Walmart and First Health Part D Value Plus, nearly 3 million beneficiaries are choosing low-premium plans with preferred pharmacy networks.  Between 2012 and 2013, premiums have been fairly stable with an average annual increase of only 2%.

The first graphic below examines trends in Medicare Part D coverage by a prescription drug plan (PDP), Medicare Advantage drug plan (HMO), preferred provider organization (PPO), preferred fee-for-service (PFFS) and other Part D plan types.  The second graphic displays enrollment and premium information for the top 10 Part D plans as of 2013.

Part D Enrollment by Plan Type 2009-2013

Monthly Premiums for Top 10 PDPs

 

 

Posted in Medicaid/Medicare, Medicare, Medicare Part D, Pharmaceuticals , , , , | No Comments »

Weekend Links

Written By: Jason Shafrin - Apr• 19•13

Some reading for your weekend:

Posted in Current Events , | 1 Comment »

Quotation of the Day

Written By: Jason Shafrin - Apr• 19•13

“When you have a hammer, everything looks like a nail.”

Overwhelmed Blue Person Holding A Hammer And Nail While Standing In A Patch Of Many Nails Clipart Illustration Image

 

Picture hat tip to Wages of Wins.

Posted in Economics - General, Quotation , | No Comments »

Cavalcade of Risk #181: The ‘What If’ Edition

Written By: Jason Shafrin - Apr• 17•13

The news of the bombing at the Boston Marthathon has shaken many Americans.  How could such a thing happen?  What are the odds that such a thing happens to me?

Let’s try to quantify the risk.  According to FindMyMarathon.com, in 2012, there were 658 marathons in the U.S. and Canada.  Thus, the probability of a bombing of a randomly selected marathon in the U.S. or Canada is about 0.2% if one assumes one bombing per year.

The Chicago Tribune reports that 100 people were injured and 3 people died.  In 2012, 528,375 individuals finished a marathon.  Thus, the probability of being injured at a marathon due to a bombing is 0.02% and the probability of being killed is 0.0006% or fewer than 1 in every 150,000 individuals.

About 1 in 100,000 marathon finishers die during or in the 24 hours immediately after a marathon, according to The New York Times.  Thus, marathoners are at higher risk of dying of a heart attack after a marathon than from a terrorist attack.

Although the chances of being injured or killed in any marathon are relatively small, life is still full of unforseen events.  In today’s Cavalcade of Risk, the best of the blog-o-sphere answers the question ‘What If’?

  • What if I get bird flu?  Risk Management Monitor examines what they call “the largest health threat…that the globe has seen in several years.”
  • What if you suffer from a degenerative disease?  Hull Financial Planning discusses how to create a financial plan for multiple sclerosis.
  • What if your home is destroyed by an earthquake? InsureBlog notes that often times your homeowners insurers will not cover the damage caused by this natural disaster.
  • What if you are wasting money on unnecessary insurance premiums?  Chatswood Consulting Limited examines whether certain provisions of income protection insurance are unnecessary.
  • What if I lose my hearing?  The Health Business Blog notes that the risk of this event increases for individuals who use the high-powered Excel Xlerator hand dryers.
  • What if Medicare runs out of money?  The Disease Management Care Blog examines how the U.S. could learn from Canada, France, Germany and England to decrease the rate of growth of health care spending.
  • What if I am injured on the job? Workers Comp Insider examines whether companies can build mobile apps to improve workers safety.
  • What if I die of old age?  Life Insurance by Jeff examines weather people over 65 need life insurance.
  • What if the world is run by egotistical psychopaths?  Ponerology News reviews the movie I am a Fishead which examines why financial professionals took enormous risks leading to the economic recession.
  • What if I am a helicopter pilot searching for life insurance?  Rootfin provides some helpful tips.
  • What if Medicare cuts reimbursement rates?  The Healthcare Economist finds that hospitals are not likely to raise private payer cost, but rather decrease large capital expenditures on advanced medical records and curtail the offering of unprofitable services (e.g., trauma centers, alcohol and drug treatment).

Jeff Root of Rootfin hosts the next Cavalcade of Risk.

(more…)

Posted in Carnivals, Current Events , | 4 Comments »

Our Monopoly Economy

Written By: Jason Shafrin - Apr• 16•13

Via The Atlantic:

  • Four airlines control 69% of domestic air travel
  • Amazon sells 27% of consumer books in the U.S.; Barnes & Noble sells 16%
  • Walmart sells 57% of Americans’ groceries
  • Universal Music Group controls 38% of the global market for recorded music
  • Anheuser-Busch InBev sells 39% of beer in the U.S.; Miller-Coors sells 26%
  • Intel controls 85% of the global market for PC microprocessors.
Posted in Economics - General | No Comments »

Do hospitals cost shift?

Written By: Jason Shafrin - Apr• 14•13

Many health policy experts claim that hospitals engage in cost shifting. Cost shifting assumes that hospitals have some target profitability level and can demand is fairly inelastic.  Thus, if public programs (i.e., Medicare or Medicaid) cut prices, hospitals ‘cost shift’ by raising prices to the privately insured in order to reach their target profitability level.

In fact, empirical evidence does indicate that many providers lose money treating Medicaid patients and, possibly, Medicare patients, but cover these losses with high private prices. Nevertheless, this finding is not conclusive evidence of cost-shifting.

A paper by Dranove, Ody, and Garthwaite poses the issue as follows:

This cross-sectional pricing data demonstrates that hospitals price discriminate but does not provide clear evidence of cost-shifting because it does not tell us whether providers would further increase private prices after experiencing a negative shock.

In fact, the authors use an exogenous source of variation, the stock market collapse of 2008, to determine whether hospitals cost shift.  Because all hospitals experienced the stock market collapse and because patient demand also changed over this time period (likely due to many individuals facing unemployment and a loss of employer-sponsored health insurance), simply looking at cost shifting longitudinally is not useful.

Rather, the authors adopt a panel approach where they use the fact that certain hospitals experienced different levels of financial loss from the stock market collapse compared to others.  The authors use data from Medicare hospital cost reports to measure changes in hospital endowments.  Other data sources include: CMS impact files, the American Hospital Association Annual Survey, the Healthcare Information and Management Systems Society (HIMSS) dataset and some additional sources.

When applying this approach, the authors find “no evidence that the average hospital raises prices in response to losses in endowments.”  Hospitals did make some changes in response to the financial crisis.

We find no evidence that hospitals cut staffing, which stands in contrast with how universities responded to the financial crisis. We do find that hospitals decreased large capital expenditures on advanced medical records and curtailed the offering of unprofitable services such as trauma centers and alcohol and drug treatment facilities. These reactions provide valuable information for evaluating the incidence of policies generating financial shocks for hospitals. Rather than simply impacting the prices paid by privately insured patients, these policies can result in broad changes in the quality and availability of health services for all patients.

(more…)

Posted in Hospitals , | 1 Comment »

Health Insurance Exchanges: Lessons from Switzerland and the Netherlands

Written By: Jason Shafrin - Apr• 12•13

Health reforms in Switzerland and the Netherlands in 1996 and 2006, respectively, created managed competition in the countries’ health insurance markets.  These insurance markets are somewhat similar to what is being proposed through the ACA’s health insurance exchnages.  Ewout van Ginneken, Katherine Swartz, and Philip Van der Wees (2013) suggest that these implemenations offer 5 key lessons  for U.S. policymakers to follow.

First, risk-adjustment mechanisms—which provide premium adjustments intended to compensate health plans for enrolling people expected to have high medical costs—need to be sophisticated and continually updated. Second, it is important to determine why people eligible for coverage don’t enroll and to craft responses that will overcome enrollment barriers. Third, applying for subsidies must be simple. Fourth, insurers will need bargaining power similar to that of providers to create a level playing field for negotiating about prices and quality of services, and interim cost containment measures may be necessary. Fifth and finally, insurers and consumers alike will need meaningful information about providers’ costs and quality of care so they can become prudent purchasers of health services, since managed competition among health plans by itself will not substantially drive down health costs.

Source:

  • Ewout van Ginneken, Katherine Swartz, and Philip Van der Wees (2013). Health Insurance Exchanges In
    Switzerland And The Netherlands Offer Five Key Lessons For The Operations Of US Exchanges. Health Affairs.
Posted in Health Reform , | No Comments »

HWR Tackles Healthcare Reform

Written By: Jason Shafrin - Apr• 11•13

The latest edition of the Health Wonk Review is up at Colorado Health Insurance Insider.  The best of the blog-o-sphere tackle new questions in healthcare reform.

Posted in Carnivals , | No Comments »

State and Local Healthcare Spending On the Rise

Written By: Jason Shafrin - Apr• 10•13

Although health spending at the national level grew by only 3.9 percent in 2011, state and local health care spending grew by 10 percent. Between 2008 and 2010, state and local health care spending grew by only 3 percent; According to a Pew report, however, the prior trend of decelerating healthcare spending at the state and local level was a result of the stimulus bill.

Under the American Recovery and Reinvestment Act (ARRA) and later legislation that extended certain ARRA provisions, the federal government contributed an extra $103 billion to Medicaid, with states receiving the bulk of that total in 2009 and 2010. So, while the recession swelled Medicaid rolls and drove increases in total program expenditures, states’ share of Medicaid spending actually declined from $146 billion in 2008 to $135 billion in 2010. The extra federal Medicaid money stopped flowing at the end of June 2011, which was the primary reason state Medicaid expenditures rose to $165 billion in 2011—a 22 percent increase from 2010.

The long-run trends is for healthcare spending to eat up a larger and larger share of state and local budgets; state and local health care spending as a share of revenue increased from 16 percent to 30 percent from 1987 to 2011. In fact, “the Government Accountability Office (GAO) warns that health care spending is the primary driver of the long-term fiscal challenges that it expects state and local governments will face.”
(more…)

Posted in Uncategorized | No Comments »
<<23456>>