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Thursday, April 29, 2010

What the health care reform bill is actually doing

Lately I have been attending various administration level functions at our hospital, as the doctor who has ideas about reducing costs.  I suspected, when I began rabble rousing, that the hospital administration would passively or even actively oppose open discussion of where money was being wasted, since most of that wasted money seemed to go directly into the hospital's accounts.  Apparently the hospital associations have been reading the writing on the wall for some time, and have realized that there will be cuts in their revenue. The administration was already interested in cost transparency when I began to push for it, and the CEO as well as members of the board have been very receptive to various ideas that would improve quality and efficiency, even to the point of considering options for providing a health care package to our whole community.

In a meeting lately, a representative of the corporation that owns our hospital spoke, during a talk I gave, on the corporation's efforts to understand the provisions of the bill and prepare for the impact on hospital functions.  The lawyers don't really understand it all yet, but are working hard to see which pilot programs we would be eligible for, and where we need to tighten up with regard to quality and spending.

Recently I got two letters from different insurance companies, one a government payer, one a private payer, about their new plans for requiring certain information from doctors before approving non-emergency imaging procedures, such as cat scans and MRIs.  The radiology department itself hopes to make these unnecessary by policing the appropriate use of these tests to avoid duplications and excess radiation exposure.

Are all of these changes mandated by the health care reform bill? No, not at all. Were they ongoing before the discussion of reform began? No, certainly not in my awareness.

I am coming to the conclusion that the entire painful process of debate, public protests, political grandstanding and eventual passage of a flawed and ridiculously long and complex bill has had some profoundly positive consequences.  Doctors, who have frustrated me by their apparent lack of engagement with this whole process, have been bombarded with the issues in the media for months. They can't help but realize that cost and waste and lack of transparency are issues. Realizing this cannot help but influence their conversations with patients and their practice styles. Because the bill is long and hard to comprehend, doctors and hospitals are projecting all of the problems of our health care system on the bill, and are attempting to solve problems that have either not been solved by the bill, or in some cases, not even addressed.

Because so much that we do in medicine carries a high pricetag, even small changes in the efficiency of our practice will result in huge dollar savings. I would not be at all surprised to find that in a few years the estimates of savings from the congressional budget office significantly underestimate the savings we actually see.

Wednesday, April 28, 2010

What is the problem with "fee for service"?

When I first started to the hear the mantra "the problem is fee for service" in the discussion of health care reform, I couldn't quite wrap my head around it.  What exactly did this mean?  I had worked for an HMO, received a salary, and now that I no longer work for a salary, and make money based on the amount of work I do, I feel more free to practice the way that works best for my patients, me, my family and my friends. Sure, higher performing systems like the Mayo Clinic work with salaried physicians, but doesn't that take away those physicians' incentives to provide the best service?

The problem with fee for service is that the services for which I charge a fee are not the services which are of value to my patients.  What patients want, mostly, is good health with a minimum of time, effort and money spent to get it. What I charge them for is face to face time in the office.  What I spend most of my time doing is solving problems in a context that is different from face to face time with my patients, and I am not usually paid for that at all.  So the face to face charges subsidize the huge amount of problem solving.

The problem, then, is fee for "service". The problem is the definition of service.  In order to be focused on giving what patients actually want, it would be very helpful to be paid according to the effort and efficient provision of those services.

Perhaps he rest of you had already figured this out, but I am a little bit slow sometimes.  This does actually mean that the whole way of providing care and compensating for it needs to be re-vamped to adhere to service that is actually useful, not making work, looking busy, complicating issues in order to appear more competent.

Wednesday, April 14, 2010

Options for reform of the medical malpractice system

This article, in the New England Journal, offers some truly innovative ways to deal with the fact that suing for medical malpractice rarely serves the purpose of compensating the injured party or improving the dysfunctional system or practitioner. I intend to propose an institutional "disclose and offer" option at the hospital where I work, since it seems unlikely that a better option will replace medical malpractice as it now exists, at least during my lifetime.

Here is the article, in full, because it is all good:

by Michelle M. Mello, J.D., Ph.D., and Thomas H. Gallagher, M.D.

In February 2010, the Illinois Supreme Court ruled that the state’s cap on noneconomic damages in medical malpractice cases violated the Illinois constitution.1 This development has contributed to growing pessimism about traditional approaches to medical liability reform. In some quarters, interest is shifting to innovative reforms that can be implemented by health care institutions and liability insurers without requiring changes in the law. These approaches provide a better balance between the interests of providers and those of patients and illuminate a path around the political gridlock over tort reform. They also afford opportunities for health care institutions and liability insurers to take the lead in reforming the processes for providing compensation for medical injuries.
Here, we focus on emerging models of disclosure of medical injuries and early resolution of cases (”disclosure and offer” programs). Other models of private reform, including mandatory binding arbitration and voluntary mediation, have reportedly had some success but have failed to become widespread. The market may be more receptive to disclosure-and-offer approaches, which link the compensation system to improvements in patient safety.
In general, private, institution-led reforms have many advantages. First, most of the reforms can be pursued without legislation. In some states, it is nearly impossible to effect liability reform because of political divisions fostered by powerful interest groups. In others, the legislature is dysfunctional and unable to accomplish major reform or is hamstrung by budgetary problems. Initial optimism that federal health care reform legislation would include major liability reform eventually faded, though the Obama administration has made a substantial commitment to supporting demonstration projects in which health care systems or states implement innovative reforms.2
Second, institutional reforms can be led by physician champions and other insiders, promoting buy-in from clinical and risk-management staff. Third, because most private approaches do not abridge legal remedies, they may be more palatable to consumer groups, trial-lawyer organizations, and patients. Fourth, private approaches can be tailored to each institution’s unique culture, systems, and resources. Finally, institution-led approaches represent a market solution governed by market forces. Insurers and health care organizations (and perhaps even clinicians and patients) can “vote with their feet,” and successful programs can be expanded and replicated, while unsuccessful ones are discontinued.
The disclosure-and-offer approach has been implemented by a handful of hospital systems and liability insurers, building on an early experiment at the Veterans Affairs hospital in Lexington, Kentucky.3 Three distinct models have emerged. All begin with an organizational policy of full disclosure of adverse events and training and support for clinicians to aid them in making disclosures. All share a general philosophy of risk management that holds that being candid about medical injuries, apologizing when appropriate, and providing for the patient’s financial needs (in at least a limited way) through a quick, accessible process will eliminate the impetus for most patients or families to sue and will spur institutional learning and safety improvement. The models diverge in their specific approaches to compensation.
In what we call the “reimbursement model,” the institution offers to reimburse the patient for some out-of-pocket expenses related to the injury and for “loss of time.” The program has a predetermined limit on reimbursement (typically about $25,000 for expenses and $5,000 for loss of time), and reimbursement is offered without an investigation into possible provider negligence. Patients who accept the money do not waive their right to sue. However, injuries that are clearly due to substandard care, as well as fatal injuries and cases in which a claim has been filed or an attorney is involved, are excluded and handled through traditional claims processes. The best-known example of this model is the “3Rs” program operated by COPIC Insurance, a private, physician-directed medical liability company in Colorado.
The “early-settlement model,” pioneered by the self-insured University of Michigan Health System,4 is quite different. There are no preset limits on compensation. Compensation is not generally offered unless the institution, after an expedited investigation, determines that the care was inappropriate. The offer may include compensation for all elements of loss that are compensable in tort cases, including medical expenses, lost income, other economic losses, and “pain and suffering.” To accept the money, patients must agree that it constitutes a final settlement, thus foreclosing a lawsuit. The early-settlement approach is applied to all injuries; there are no exclusion criteria.
The third model, proposed in scholarly work on the basis of the successful experience of several foreign countries, is health courts.5 Patients are informed, at the time an injury is disclosed, that they can file a compensation claim with the provider or its insurer. A panel of experts, aided by decision guidelines, determines whether the injury was avoidable — a determination that turns on whether the injury would ordinarily have occurred if the care had been provided by the best specialist or an optimal health care system; the avoidability standard is more generous than the negligence standard. For avoidable injuries, the institution offers full recompense for economic losses plus an amount for pain and suffering according to a predetermined compensation schedule that is based on injury severity. Some health court proposals envision that patients who are dissatisfied with a decision could bring their case to a second administrative panel or judge provided by the state, with a limited right of judicial appeal.5 Alternatively, in voluntary health court models (in which a state process has not been created through legislation), patients could reject the compensation offer and file a lawsuit, unless they had previously waived this right as a contractual condition of receiving care. Although health courts have not yet been adopted in the United States, President Barack Obama recently called for “demonstrations of alternatives to resolving medical malpractice disputes, including health courts.”2
A key feature of all disclosure-and-offer models is that the information obtained from the investigation and resolution of injury cases is used to improve patient safety. All the countries with health courts maintain and analyze large national databases of medical injuries to identify dangerous conditions or processes and share that information with health care institutions.5 Within U.S. institutions operating disclosure-and-offer programs, the analysis and sharing of data strengthen relationships between risk managers and patient-safety officers, facilitating the implementation of safety interventions. Liability insurers can use other strategies to promote safety, such as offering financial incentives to clinicians for completing disclosure training, following safe practices, and reporting incidents promptly to risk-management officials. Although all these measures can be pursued within traditional claims-management processes, disclosure-and-offer programs create structures and institutional commitments that enhance their effectiveness.
Nevertheless, institution-led malpractice reform has limitations. The development of local programs exacerbates the patchwork nature of compensation for medical injury, which originates from variations among juries and state tort reforms, and can cause inequities in compensation for patients with similar injuries. In addition, institutional innovations are harder to evaluate rigorously than are statewide reforms. More innovative reforms are riskier than more traditional types of reforms. Health courts have not been tested in the United States, and it is unclear to what extent the successes reported by pioneers of the reimbursement and early-settlement models would be generalizable to other institutions. A program’s success would probably be affected by the particular organizational structure of the institution, the availability of resources, the institution’s tolerance for risk, and the personalities of those involved in implementing the program. Furthermore, the fact that private reforms generally preserve legal remedies constrains their ability to limit litigation.
Institution-led reform may also be hampered by regulatory requirements. For example, state insurance departments, which regulate the management of malpractice claims, may be more permissive or less permissive in their attitudes toward disclosure-and-offer programs. The federal requirement that all claims payments be reported to the National Practitioner Data Bank may discourage physicians from agreeing to early settlements, though the requirement does not apply to reimbursement programs. Finally, leaving reform to private institutions may result in reforms that are driven more by financial benefits for hospitals than by considerations such as improved performance of the injury-compensation system or “doing the right thing” for patients.
Certain policy measures could stimulate more widespread adoption of private malpractice reforms (see table). This experimentation is not free of risk, but institutions should seize the opportunity to lead rather than wait for tort reform at the federal or state level. Their ingenuity, vision, and commitment to helping injured patients can improve a system that bedevils providers, patients, and policymakers alike.

Thursday, April 8, 2010

More indications of positive change from the Journal of the AMA

Who would have thought that the Journal of the AMA would be an agent of positive social change? The AMA has, for me, symbolized the most frighteningly powerful aspects of organized medicine, and its trade journal, the JAMA has been one of the big 3 (with the New England Journal and the Annals of Internal Medicine) vehicles for presentation of relevant cutting edge clinical research. But since health care reform has been in the news the JAMA has offered many well considered opinion articles about how best to make American medicine serve the people.

The lead article this week presented research in the area of surgical treatment for spinal stenosis.  Spinal stenosis is a common and disabling subset of what people think of as "a nerve pinched in my back".  Patients with spinal stenosis have bony growth or disc protrusion into their spinal canal in such a way that the spinal cord is crowded, leading to pain down a leg, or both legs, with exertion or in certain postures.  It has been pretty successfully treated for many years with decompression and sometimes fusion of the vertebrae involved.  In recent years there have been advances in the field of spine surgery and now the vertebral column is sometimes stabilized with complex and expensive hardware, and sometimes the bone growth is enhanced with the use of bone growth proteins.  This has allowed surgery to be successful in very complex cases, including cases in which there is spinal deformity such as severe scoliosis.  Use of these new technologies, however, is extremely expensive, and cases in which the new technologies are used have a higher complication rate.  This would be acceptable if the new technologies were only used for the complex cases, but now the new technologies are very commonly used, resulting in an increase in cost for surgical treatment of spinal stenosis from about $23,000 for the standard procedure and hospitalization to over $80,000 for the complicated version, with a relative risk for complications, including death, that is nearly 2 and a half times that of the less complicated surgery.  The factors that lead to increase in use of the more complex surgeries include the fact that medical device manufacturers advertise the superiority of these procedures (which involve the use of hardware that can cost upwards of $50,000 per case) as well as fact that a surgeon may be reimbursed $600-$800 dollars for the simpler surgery and up to 10 times that for the more complex surgery.

What, you might ask, is positive about that story? What is positive is that it is the lead article in the JAMA and that there is an editorial by Jay Lemery which neither apologizes for or rationalizes the findings. The conclusions, in fact, of the editorial are that patients and surgeons and payors need to carefully assess the value and risks of new technologies, and that market forces, such as they are, do not favor careful assessment. Tell it, brother!

Only 4 pages away from this editorial is another opinion piece with the title "Moving Reform to the Bedside." The authors, Drs. Erica Spatz and Cary Gross, say that doctors should start reforming health care themselves, without waiting for legislators to do it for them.  They suggest that doctors use the tools we have to provide good quality care that is based on evidence of what works, when there is such evidence, and that we consider costs when deciding which tests and medications to use. They suggest involving patients in making decisions, and even talking to them about why health care reform is necessary and how these changes might occur. They suggest that we become involved with creative ways to allow access to health care in our communities, and that we avoid being seduced into free lunches and other goodies by representatives of drug and device companies.  None of this is new, in fact most of these pieces of advice can be found somewhere in the archives of this blog, but it is INCREDIBLY GRATIFYING to see them in an editorial in the Journal of that bastion of organized medicine, the American Medical Association.