Medicare Plans to Penalize Hospital Use

Guest Contributor Paul Burke

Published at: http://www.ireachcontent.com/news-releases/medicare-plans-to-penalize-hospital-use-267175701.html

Medicare plans to penalize hospital use for 4.9 million seniors who get health care from Accountable Care Organizations (ACOs). ACOs are groups of doctors and hospitals which sign up to receive rewards from Medicare if they cut Medicare spending on their patients. They also receive protection from antitrust and kickback rules.

 

The rewards which ACOs receive are changing. Out are rewards for cholesterol management and anti-clotting treatment. In are rewards for keeping patients out of hospitals.

 

Three quarters of ACOs do not cut costs enough to get rewards, so the changes are not aimed at them. Most ACOs include hospitals, so the new incentives to avoid hospital stays are not aimed at them either; they will just bring other patients into the hospitals, with little or no net saving.

The new rewards do show Medicare's thinking about how to care for seniors.

 

Medicare plans to penalize ACOs when patients in three categories have unplanned hospital stays. The three categories are: diabetes, heart failure and multiple chronic conditions. Even when these patients need hospital stays, such as for appendicitis or heart attacks, Medicare proposes a penalty on each stay.

 

ACOs are already penalized when their patients go to hospitals for treatment of heart failure, emphysema, chronic bronchitis or asthma, on the reasoning these can be treated without hospital stays. ACOs are supposed to minimize hospital stays for those treatments, and now are also supposed to minimize hospital stays for patients with diabetes, heart failure or multiple chronic conditions.

 

ACOs have also faced penalties each time a patient leaves a hospital and is readmitted within 30 days to the same or another hospital, for related or unrelated treatment. An extra penalty will apply in the future if the patient goes to a nursing home in between. Penalties are additive, so six penalties will apply for example to a patient with multiple chronic conditions who goes into a hospital for emphysema, then to a nursing home and back to a hospital for heart failure within 30 days.

 

Doctors and Medicare patients can avoid these penalties on hospital stays. They can try to identify ACOs which have cut costs enough to care about the penalties and avoid them, or avoid all ACOs, or choose hospice, which ends all curative care. Avoiding ACOs is wise, according to Regina Herzlinger, PhD, of Harvard Business School, when patients have serious issues such as "diabetes, cancer, or congestive heart failure. You need specialists for that. They are the opposite of organizations, such as ACOs, that do everything for everyone."

 

ACOs may not want seriously sick patients anyway. Simon Prince, MD, President of Beacon ACO in New York, which does earn rewards, presciently said before Beacon became an ACO, "If they're going to put the risk back onto the ACO and onto the physician, it's going to be more difficult and we could start self-selecting which patients we want to include in our ACO."

 

In each measure ACOs need to be above the 90^th percentile to get full rewards, so for example they get full rewards if they hospitalize fewer diabetes patients than 90% of their competitors. This high target shows Medicare's high priority for reducing hospital use. Medicare has already extended hospital readmission penalties to patients outside ACOs. It also cuts general hospital payments based on total patient cost from 3 days before the stay to 30 days after.

 

As Medicare extends penalties outside ACOs, it will be harder for patients with chronic illnesses to avoid the penalties and keep getting complete care.

 

Many goals of quality medicine are not covered in this reward system. There are no rewards for keeping patients alive or for prevention or treatment of most conditions, such as cancer, HIV, disabilities, osteoporosis, kidney disease, or pain. Tonya Saffer of the National Kidney Foundation says, "Quality measurement is not exactly where it needs to be yet. We need true outcomes measures that are associated with morbidity, mortality, and patient quality of life."

 

Medicare struggles even to follow medical guidelines. They are dropping rewards for cholesterol management and anti-clotting therapy because guidelines changed.

 

Aco.globe1234.com lists all the rewards, and it lists the 369 ACOs, which serve 4.9 million patients. Most doctors, 61%, do not plan to join ACOs, so patients have choices. Medicare accepts comments until Sept. 2 on the new reward structure. ACOs which cut costs will start earning the new rewards in October 2015.

AFFORDABLE HEALTHCARE 2.0

Published in http://hnn.us/article/154172

Those wanting an expanded governmental role in healthcare and those opposing it are fighting the wrong battle in the wrong way.

The debate over national healthcare policy has lasted over a century – intensifying during the Clinton Administration. It has always been about coverage, liability, and finance, never about care protocols and patients. http://kaiserfamilyfoundation.files.wordpress.com/2013/01/7871.pdf If making health affordable is everyone’s stated goal then why not focus on the actual care, health, and wellness of Americans?

America remains the best place on Earth to have an acute illness or shock-trauma injury. Our nation’s emergency rooms and first responder protocols are unequaled. Princess Diana may have lived had her car accident happened in New York City instead of Paris. America’s diagnostic methods and equipment are unequaled. That is why patients from all over the globe seek answers to complex symptoms by visiting the Mayo Clinic, the Cleveland Clinic, Johns Hopkins, Sloan Kettering and countless other world class facilities.

The other side of American healthcare is its failings in chronic care, expense, and a system that is controlled by the medical profession, pharmaceutical companies, and insurance industry. This triad of entrenched interests has prevented the widespread use of substances and therapies deemed effective and traditional in most of the world.

Thankfully, an increasing number of healthcare professionals are embracing global best practices, virtual technology, and patient-centric methods. These innovations are improving the health of patients while driving down costs. This is the arena where policy-makers should check their partisanship at the door. Seeking ways to improve healthcare, not health financing, will ultimately make health affordable to us all.

I have personal experience with the convergence of these worlds. Since 2007, I have been the primary caregiver to several family members with serious chronic conditions. These conditions have been punctuated by emergency care and major surgeries. Making decisions and managing treatment across this spectrum has been a real education.

This education has helped me identify four major areas of opportunity for healthcare improvement. These four areas will improve our health and healthcare, while addressing the affordability of private and public health services.

First, not all ailments require doctors and prescription medications. Government and industry policies drive people away from cheaper and more effective natural remedies. Herbal remedies have been successfully used since the first humans. For example, Apple Cider Vinegar has completely solved acid reflex for two of my family members. However, natural substances are not covered as a medical expense either by insurance or tax deductions. Instead, acid reflex sufferers must pay for over-the-counter treatments (which are also not covered by insurance or tax deductions), or must obtain expensive prescriptions after paying to see a doctor or a specialist. Being a natural treatment, the vinegar regime also avoids side effects and drug interactions. http://www.healthcentral.com/diet-exercise/c/299905/155581/potential?ic=506048 Why not go “back to the future” and find ways to support these more affordable and effective treatments?

Second, nurse practitioners form one of the new front lines of care http://www.aanp.org/. The overwhelming majority of my family’s office visits are with a nurse practitioner interacting with the patient and the lab technicians. Occasionally, a doctor will review the information and discuss treatment options with the patient. Supporting the evolution to Nurse Practitioners through education, professional certification, protocol modifications, and pricing would bring down costs and expand health opportunities both for professionals and patients.

Third, community caregiving is another new frontline of achieving and sustaining wellness. In 2009-2011, I was part of the planning team for developing a community-based care system for the Atlanta area. We found a disturbing pattern - patients, especially Medicare/Medicaid patients, arrive in hospital emergency rooms when their chronic conditions, such as Diabetes, congestive heart failure, and Chronic Obstructive Pulmonary Disease (COPD), become acute. These patients are treated at the most expensive point of care (emergency room). Once they are released, many do not have the support (family, friends, neighbors) or the capacity (some form of dementia) to follow a treatment regime that would prevent the next emergency room visit. These revolving door patients drive-up costs and end-up in a cycle of deterioration.

Our solution was to develop a community-based healthcare network. Such networks are known as “Accountable Care Organizations” (ACOs) http://innovation.cms.gov/initiatives/aco/. They break-out of traditional hospital and doctor office environments to forge partnerships with the community – churches, social workers, local government, neighbor associations, and nonprofits. A needy patient with chronic conditions is assessed holistically. This includes risk factors (i.e. smoking, alcoholism, drugs) and environmental factors (family & home environment). A care plan is developed and assigned to a multi-faceted care team (comprising community resources) and a care manager. Doctors and nurses are part of the team. The majority of health actions take place among family and community - driven by Electronic Medical Records, aided by remote sensors and virtual care, and guided by the managed care team.

The result of this holistic approach is improved care, sustainable health, and reduced costs. It is the one way Medicare and Medicaid costs can be substantially reduced while enhancing quality of life. There are initiatives to promote this methodology within the Center for Medicare and Medicaid Services (CMS), but it is occurring too slow and is too isolated.

ACOs are making a difference, but no major politician has embraced the concept and neither party has promoted them as a way to reduce Entitlement costs.

Fourth, families have always been a pivotal component in healthcare. Whether it is a parent staying home to care for sick children, or adult children caring for ailing parents, family caregiving is vital, but also emotionally and financially draining.

According to the National Alliance of Caregiving, 70 million Americans provide unpaid assistance and support to older people and adults with disabilities. Forty percent of these caregivers provide care for 2-5 years, while approximately 29 percent provide care for 5-10 years. Unpaid caregiving by family and friends has an estimated national economic value (in 2004) of $306 billion annually—exceeding combined costs for nursing home care ($103.2 billion) and home health care ($36.1 billion). This value is increasing as the population ages. http://www.caregiving.org/data/CaregivingUSAllAgesExecSum.pdf

I know how much time is spent with ailing family members. Current IRS regulations provide for listing parents as dependents based only upon financial support.

http://www.irs.gov/pub/irs-pdf/p501.pdf However, there are no tax credits or deductions for those who have the Medical Power of Attorney and devote countless hours to direct care or acting as the patient’s advocate for managing their care. Politicians at both the state and federal levels should provide relief for this indispensable and growing volunteer service sector.

These four areas of opportunity will not address every health issue or entirely diffuse the fiscal bombs strapped to medical entitlements, but they are a good nonpartisan start. It is time for politicians to focus on the wellbeing of patients, not themselves.

[Scot Faulkner was Chief Administrative Officer for the U.S. House of Representatives. He served on the ACO team for the Southeast Atlanta Health Care System [SAHCS] and as an advisor on professional standards to the American College of Dentists. He has been the Medical Power of Attorney and primary caregiver for his spouse and parents since 2007. http://citizenoversight.blogspot.com/ ]