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Dean v. Orszag on IPAB

July 31, 2013
11:25 am

The opposition to the Affordable Care Act’s Independent Payment Advisory Board (IPAB) gained public support this week from what was, to some, an unlikely voice.  Former Vermont governor and one-time Democratic presidential candidate Howard Dean penned an op-ed in The Wall Street Journal urging that congressional Democrats and Republicans join together to repeal IPAB.

He wrote, “One major problem is the so-called Independent Payment Advisory Board. The IPAB is essentially a health-care rationing body. By setting doctor reimbursement rates for Medicare and determining which procedures and drugs will be covered and at what price, the IPAB will be able to stop certain treatments its members do not favor by simply setting rates to levels where no doctor or hospital will perform them.”

The Dean op-ed spurred immediate, and often harsh, criticism from the political left.  One of the first opinion pieces responding to the Dean criticism came yesterday from former Office of Management and Budget director Peter Orszag, a strong and consistent IPAB supporter.  Mr. Orszag wrote on the Bloomberg website that “the point of having such a board….is to create a process for tweaking our evolving payment system in response to incoming data and experience, a process that is more facile and dynamic than turning to Congress for legislation.”

Of course, I encourage everyone to read both op-eds and form your own opinions on where the most valid arguments lie.  Here are some of my thoughts:

  • Some call it a major surprise that a fervent liberal like Governor Dean would oppose IPAB.  Actually, I think it’s logical that he sees the problems with the concept.  As a physician, Governor Dean understands the perils to patient access to care if an appointed board is empowered to reduce what physicians are paid for treating Medicare beneficiaries.  We’ve already seen reports this summer that the number of physicians opting out of Medicare is nearly triple what it was three years ago.
  • Any debate over IPAB invariably turns to the subject of healthcare rationing.  Mr. Orszag makes the point in his op-ed, as IPAB defenders often do, that the Affordable Care Act language prohibits the board from rationing care.  This is a technically accurate assertion, but it obscures real-world consequences.  If IPAB reduces Medicare payment rates, it will inevitably affect access to physicians.  This may not be rationing in the purest sense of the word, but tell that to the senior who can’t find a doctor.
  • Governor Dean makes a broader point in his op-ed that warrants further amplification and debate.  He wrote that “rate setting – the essential mechanism of the IPAB – has a 40-year track record of failure.”  This point of view needs to be part of a larger debate on structural Medicare reform.
  • Mr. Orszag invests IPAB with a role that the Congressional Budget Office doesn’t foresee.  He writes that the board will be able to make the subtle adjustments in Medicare made possible by new delivery and payment models like accountable care organizations.  In reality, though, as CBO has pointed out, IPAB must make changes that bring Medicare spending down to an arbitrary level within a one-year timeframe.  This will inevitably mean straightforward cuts in what Medicare pays for healthcare goods and services.

The headline of the Orszag op-ed is “Critics Are Wrong About the Medicare Payment Board.”  And yet, Governor Dean’s arguments clearly show that the critics have a compelling point and that IPAB repeal should be a bipartisan congressional priority.

The Health Value of Carrots

July 18, 2013
10:46 am

A new study published in Health Affairs provides compelling evidence that “carrots” — in this case, not the vegetable, but rather financial incentives — can make a significant difference in modernizing medical practices and improving patient health.

In this case, the practice being focused upon is e-prescribing.  Prior to 2008, it wasn’t happening to any great degree.  According to an article on the Health Affairs blog by Max Sow, head of business intelligence for Surescripts (a Healthcare Leadership Council member), only six percent of office-based physicians, about 40,000 healthcare providers in all, had moved from pen-and-paper prescribing to digital before Congress passed the Medicare Improvements for Patients and Providers Act (MIPPA).

We know now that the financial incentives contained in MIPPA made a difference in physicians modernizing their prescribing practices.  The certainty is provided by Surescripts’ prescription data which, unlike a survey of doctors, leaves no room for false answers or misinterpretation.  Clear patterns can be seen in the data on when and where e-prescriptions are being issued.

The study published in Health Affairs shows that, for a 26-month period prior to the creation of financial incentives through MIPPA, there were an average of 1,437 new e-prescribers per month in the physician community.  After those incentives were implemented, the number of new e-prescribers per month jumped to an average of 6,346 from 2008 to 2010.  This growth wasn’t isolated to any particular geographic area, but took place nationwide.

The benefits to patients from this paper-to-digital shift were considerable.  With e-prescriptions, the prospects for medication error are reduced because pharmacists aren’t trying to interpret doctors’ handwriting and digital networks strengthen the ability to identify possible conflict between drugs a patient is taking.  Also, studies have shown that medication adherence rates improve when prescriptions are transmitted directly to the pharmacy.

The Surescripts data takes on great importance at a time in which policymakers are striving to make health information technology adoption universal throughout the healthcare system.  The numbers on e-prescribing show us the value of carrots in achieving meaningful transformation.

Understanding Our Understanding of Comparative Effectiveness Research

July 15, 2013
1:49 pm

We know that comparative effectiveness research is important.  How important, though, and what impact it will have on healthcare delivery and clinical decisionmaking is still something of an unknown variable.

One reason this is still a matter of conjecture rather than certainty is because the ultimate impact of CER and the work being performed by the Patient Centered Outcomes Research Institute (PCORI) will be in the hands of those who receive this research.  Given that we don’t yet know the shape of this research or how end users — from insurers to clinicians to government agencies — will perceive and utilize it, CER’s effect on healthcare decisionmaking is still uncertain.

Credit goes, though, to the National Pharmaceutical Council for shining valuable light on this issue.  For the past three years, the Council has surveyed key stakeholders regarding their perceptions of CER and the effect it could have on the healthcare landscape.  NPC recently published the findings of its most recent survey in “2013 Comparative Effectiveness Research and the Environment for Healthcare Decisionmaking.”

The report contains some interesting findings, including:

  • Nine out of ten respondents — from government, academia, health plans, healthcare organizations and others — say comparative effectiveness research is “somewhat” or “very important” to them.
  • An increasing number of healthcare stakeholders are aware of PCORI and comparative effectiveness research.
  • Respondents expect CER to have a major impact on healthcare decisionmaking in the next five years rather than in the immediate short term.

It remains our expectation at HLC that comparative effectiveness research can result in better care and improved patient outcomes.  To make certain that is the case, we look forward to a continuing dialogue between PCORI and the organizations representing patients and healthcare providers.  The National Pharmaceutical Council research has turned on headlights to help better illuminate the path in which we are traveling.

Pinocchioizing the Medicare debate

July 01, 2013
9:55 am

Even if we can’t find a way to eliminate ‘Mediscare’ political tactics altogether, shouldn’t we be able to at least limit retiree-scaring strategies to election years?

This weekend, Glenn Kessler, the Washington Post’s fact checker, pointed out that even odd-numbered years are open season for frightening seniors with outrageously misleading hyperbole.  Kessler spotlighted a television ad sponsored by two political action committees, Patriot Majority USA and Senate Majority PAC, aimed at Congressman Tom Cotton (R-AR).  The video accuses Cotton of supporting a plan that would “essentially end Medicare” and cost some seniors more than $6000 a year.

This ad is, of course, absolute nonsense that has been repeated — and discredited — many times before.  Kessler, in fact, gave it his highest (or is it lowest) rating of “four pinocchios,” meaning it is highly deceptive messaging.

The two PAC groups are tying Cotton to an early iteration, since revised, of Congressman Paul Ryan’s (R-WI) Medicare reform plan.  That plan, of course, wouldn’t end Medicare, but rather open the program up to participation by private health plans.  And since the early Ryan version that the ad is referencing, the proposal has been revised to give seniors the option of remaining in conventional fee-for-service Medicare instead of opting for the private choice-and-competition plan.

Patriot Majority PAC and Senate Majority PAC know all of this, of course, but having a legitimate and necessary debate over Medicare’s future takes a back seat to using the program as a cudgel to pound down a political opponent’s approval numbers.

I don’t know if Congressman Cotton will be hurt by this ad but, regardless, he isn’t among the biggest losers here.  Those would be the Arkansas voters who are being led to believe something that simply isn’t true, and current and future Medicare beneficiaries who need and deserve a genuine discussion over how to improve and sustain the program.

Mediscare tactics are deplorable enough in election years, but can’t we at least have one year out of every two in which we can have an honest conversation about the issue?