Wednesday, February 22, 2012

Change will not come from DC

A New York Times editorial -- "A Real 'Doc Fix'" -- provides a wonderful example of how a dogmatic adherence to a particular policy prescription causes one to develop constructs that are politically impractical.  This editorial is about how to tackle Medicare costs.  The proposed solution:

1 -- Cut fees for specialists and then hold them flat;
2 -- Have the Secretary of HHS identify overpriced and overused services and reduce the fees paid for them;
3 -- "Protect primary care doctors" by holding their fees flat for a decade; and
4 -- Establish a fee schedule that pays doctors more if they leave fee-for-service and form organizations that will coordinate care or take on the financial risk of managing a patient's care for a year at a fixed fee.

There are germs of good ideas in here, but it doesn't hold together.  Let's look at reality.

Medicare has had the authority for years to adjust the relative fees paid to specialists and primary care doctors.  The Wall Street Journal has described the process.  A secretive body called the Relative Value Scale Update Committee, dominated by specialists, sets the rates.

With regard to overpriced services, Medicare also has had the authority to make changes.  Yet, even where the evidence supports lower prices, like irradiation by proton beam machines for "regular" cancers, it persists in paying more and enabling the medical arms race.

And a risk-based care regime requires elimination of the PPO feature of Medicare.  In other words, the care organization would have to require that patients lose their choice of clinicians and care venues.  As I have noted:

How can you be held accountable, as a provider group, if you cannot control the management of care of your patients?

These things proposed by The Times do not change because the interest groups that drive politics in Washington are quite content with the status quo.  It is politically hard to change the rules because "one person's costs are another person's income," and Congress and Administrations are loath to take away from powerful interests.  Further, there is no way Congress will limit choices among the Medicare population, the cohort that always votes in elections.

Change in the health care system will not be driven by major policy shifts for the Medicare-eligible population.  Those are too highly politically charged.  Change will come from two sources:

The first is employers who put pressure on private insurers and providers to calibrate pricing based on quality and other attributes.  Tiered insurance products are one result of that pressure.  (Be careful, though, as high-priced incumbents will try to obtain state legislative passes to get around those rules.)

The second source of change will be those provider institutions that adopt an approach based on patient-driven care, elimination of preventable harm, transparency of clinical outcomes, and front-line driven process improvement.  This is the path to greater efficiency and a change in cost trends.


Anonymous said...

It strikes me that Medicare is just like the tax code - and look what happened there. As long as the government concentrates on cutting payments rather than addressing the reasons for underlying costs, look for the resemblance to the tax code to only increase.


Robert said...

Appreciate your comments concerning change in health care delivery/payment not coming from federal agency. After 30 years of practicing urology and watching a generation of change I feel as if I am living in a living in a fantasy world listening to the self protection rationalizations of my peers and the tunnel vision proposals of opinion makers. Keep up the good work. I remain optimistic that we will stumble into meaningful reform if led by insightful and experienced leadership.

Barry Carol said...

If as part of tax reform we reduce or, preferably, phase out the tax preference for employer provided health insurance that could drive many more people to care about both healthcare and health insurance costs. Tiered insurance networks would likely gain more traction. More importantly, more patients may ask their doctors (1) is this service / test / procedure / drug really necessary and (2) if it is, please refer me to the most cost-effective high quality provider. As for Medicare, what makes theoretical and economic sense usually can’t make it through the legislative process.

Dr.Theresa Willett said...

Another great summary of a socio-political quagmire! In the case of limiting choice in Medicare, though, it is already happening. My mother experienced critical delays in cancer care due to difficulty finding physicians who would accept her Medicare. And this was in the Dallas-Fort Worth metro area!

Anonymous said...

It is a short cut to describe CMS as the root of all that ills US healthcare. Its capacity to achieve its mission is directly predicted by the negotiations, influence, and world view of those who lobby it and fill its ranks. Now we have the same limited science prescribing prevention. How's that obesity/diabetes/cancer prevention going so far?

We will be here in two years declaring that primary care physicians do not know how to solve obesity, that oncologists do not know how to prevent cancer, and that photon-beams can't do palliative care. Who is going to push medicine into making these larger connections? It is about to get a lot worse until we do.

Anonymous said...

I just lost a relative from a stroke that she could have recovered partially from at a better hospital. The ambulance insisted on taking her to a hospital 40 min away that did not have stroke care certification (but a contract with the ambulance company). She has care, the family thought: we have Medicaid.

Too soon for an otherwise healthy woman, the family was informed it was hopeless, and they opted for DNR and hospice. There she was taken on and off of oxygen by night staff, but never hydrated or fed. The morphine helped the passing, and all stood around talking about what a strong woman she was to hang on so long. I did not have the heart to tell them that she might not needed to have died at all.

Dr. Willett, I am sorry for your loss. There will be an avalanche of these stories given the perfect storm of demographics, poor anticipatory medicine, and resource constraints. Current realities make 'death panels' a macabre redundancy.

Tom Emerick said...

It truly is in the hands of corporate benefit executives to make repairs to the system. Each and every member of Congress believes it is his or her duty to protect the interests of specialists in their districts.


tahera said...

Changing the system is not easy, but together we can bring a change. Thank you sharing this post.