Home

Quantifying the Medicare Advantage advantage

July 25, 2018
2:51 pm

In the 15 years since its inception, the increase in popularity of Medicare Advantage (MA) – health coverage provided by private plans in contrast to traditional fee-for-service (FFS) Medicare – has been undeniable.  Roughly half of all Medicare-eligible seniors are enrolled in Medicare Advantage plan and that proportion keeps rising.

Now there is a new addition to the growing body of evidence that MA plans are not only serving their enrollees well, but is bringing greater overall value to the Medicare program than that generated by the FFS approach.

A newly-released study by Avalere Health, Medicare Advantage Achieves Better Health Outcomes and Lower Costs for Beneficiaries with Chronic Conditions Compared to Fee-for-Service Medicare, finds that Medicare Advantage is outperforming traditional FFS Medicare with higher rates of preventive screenings, fewer avoidable hospitalizations, and fewer emergency room visits.  In other words, healthier patients and significant dollar savings.

Overall, the Avalere study found that MA beneficiaries had 23 percent fewer emergency stays and 33 percent fewer emergency room visits than their peers in FFS coverage.  This wasn’t the result of MA plans enrolling healthier individuals at the outset.  Rather, the study found that a greater percentage of MA beneficiaries were in clinical and social risk categories that traditionally drive up costs in FFS Medicare.

Avalere found that MA outperformed FFS on a range of cost, utilization, and outcome metrics in caring for individuals with one or more chronic health conditions.  Among patients with diabetes, for example, those enrolled in MA experienced 73 percent fewer serious clinical complications than FFS beneficiaries.  And patients dually eligible for Medicare and Medicaid – who generally have more complicated and serious health conditions – had 49 percent fewer hospital visits and a 17 percent lower average-cost-per-beneficiary in MA plans.

Former Congresswoman Allyson Schwartz, president and CEO of the Better Medicare Alliance (of which the Healthcare Leadership Council is a member) said “this study adds to the growing body of evidence showing the ability of Medicare Advantage to align incentives to better manage the care for a high-need population with multiple chronic conditions.”  These patients, of course, account for the most significant portion of our country’s healthcare spending.

This study adds fuel to the argument that we can enhance healthcare quality and better contain spending through improved patient health when healthcare entities compete on the basis of value.

The Power in Planning Ahead

April 17, 2017
4:53 pm

Now that most of us have filed our taxes for 2016, this is an opportune time to review our health planning with the same level of attention.  There is a nationwide effort to make the day after Tax Day “National Healthcare Decisions Day” – a day in which we think about our long-term healthcare needs and make a plan for how we would like to be cared for in our final days.  At one point or another, all families face challenges with advanced illness and must make decisions about end-of-life care, but too few of us have given thought to issues like designating power of attorney or creating advance directives and living wills.  Advanced illnesses cause many challenges for families.  One of the most difficult is when family members become the primary caregiver for their loved ones and are placed in decision-making roles that they never expected.  Advanced care planning is a useful tool that can assist individuals in preparing for end-of-life care, and keeping family members and healthcare providers updated on their wishes.

For individuals faced with end-of-life care decisions, it is important to have conversations with their physicians about their treatment options and their wishes regarding advanced illness care.  Studies indicate that patients and their families are interested in discussing their end-of-life options with their physicians.  However, there is concern that physicians may lack the training or resources to engage in long-term conversations with their patients on end-of-life healthcare decisions.   For instance, a recent survey of 736 physicians, link above, found that less than one-third reported any formal training on discussing end-of-life care with their patients and their families.

The Coalition to Transform Advanced Care (CTAC), a non-partisan organization, is collaborating with the AHIP Foundation on “The Advanced Care Project,” which offers suggestions for how healthcare professionals can help patients make their decisions about their end-of-life care needs.  A combination of education and collaboration on advanced care allows for patients and family caregivers to develop their own care plan that is specifically designed to fit their needs.

Healthcare plans and providers are embarking on their own initiatives to assist and ensure that patients are able to make their own decisions about their healthcare.  For instance, Aetna offers support to its members through its Compassionate Care Programs, in which individuals experiencing end-of-life care are assisted by nurse care managers who are available to provide resources to patients and their family members, as well as assist physicians in managing the care of the patient.   The Franciscan Missionaries of Our Lady Health System in Louisiana is collaborating with the Louisiana Health Care Quality Forum in the Louisiana Physician Orders for Scope of Treatment (LaPOST) initiative on how a patient’s desires and goals into their treatment plan can be medically translated and applied to multiple healthcare settings.

SCAN Health Plan has constructed a new system to make it possible for patients and their families to understand the full array of care options available to them and to receive treatment that best fits their values, goals, and cultural preferences.  This system is called the Program for Advanced Illness (PAI). A palliative-trained nurse case manager serves as the member’s personal advocate.  The nurse will help members and their caregivers navigate care options that reflect patient’s goals and wishes, encouraging articulation and documentation of end-of-life requests while identifying healthcare proxies and making referrals to hospice.  Additionally, the nurse will communicate with all medical staff and other parties to ensure everyone understands the critical decisions being made as well as following up with the family to offer bereavement services.  More program details are available in the Viable Solutions compendium recently released by the Healthcare Leadership Council.

On National Healthcare Decisions Day, let us continue to have the conversation about how healthcare providers can best assist individuals in making their own decisions about their health care needs.  Create an advance directive and talk to your family and friends about the importance of care planning.  Visit www.nhdd.org for more information.

Walden Discussed Repeal and Replace Strategies at HLC Meeting

January 26, 2017
3:06 pm

On January 24 at a dinner hosted by the Healthcare Leadership Council for its members, U.S. Representative Greg Walden (R-OR), the new chairman of the influential House Energy and Commerce Committee, spoke of his panel’s goals for the upcoming healthcare overhaul.  CQ Roll Call published the following article based upon his prepared remarks.


CQ: Walden Outlines Obamacare Strategy to Health Care Executives By Joe Williams, CQ Roll Call

Energy and Commerce Chairman Greg Walden was poised Tuesday night to outline to health care industry executives his panel’s strategy for repealing and replacing the 2010 health care law, including insights on his plans to overhaul Medicaid.

The Oregon Republican planned to use his closed-door meeting with the Healthcare Leadership Council to discuss several measures his panel would consider in the coming weeks, according to prepared remarks obtained by CQ Roll Call.

A pair of hearings to be scheduled for late next week will center on stabilizing the health insurance marketplaces and on Medicaid. Walden is working with Senate Finance Chairman Orrin G. Hatch of Utah on changes to Medicaid, which provides health insurance to more than 73 million Americans.

Walden planned to confirm during his speech Tuesday night that Republicans will model their legislation largely on a repeal bill President Barack Obama vetoed last year.

“We will use our 2015 reconciliation bill as a starting point in order to repeal major portions of Obamacare, such as the individual and employer mandates, and address the Obamacare Medicaid expansion and the failing exchanges,” Walden’s prepared remarks say. They also say a “stability period” would be included in the legislation.

Walden also is expected to say that Republicans will “maintain protections for those with pre-existing conditions” and permit children to stay on their parents’ insurance plan until age 26, two provisions in the current law (PL 111-148, PL 111-152) that President Donald Trump has voiced support for keeping in a replacement plan.

In his prepared remarks, Walden calls on the Healthcare Leadership Council to engage publicly in the health care debate. The group includes executives from hospitals, insurers, pharmaceutical companies, medical device manufactures and other industries.

“We can’t do this alone. But by working together . . . we can reach our mutual goal of helping people live healthier lives and giving every American a new opportunity to get affordable health care coverage,” Walden will say, according to the prepared remarks.

Changes to Medicaid

Walden’s remarks don’t detail how the GOP would address the 2010 law’s Medicaid expansion, but he confirmed to CQ Roll Call earlier in the day he has had several meetings with Hatch to discuss their legislation on changes to the program.

Earlier this month, Walden organized a meeting between Republican lawmakers on his panel and GOP governors to discuss potential changes to Medicaid. He also attended a separate but similar meeting organized by Senate Finance.

A top aide to Trump said earlier this week the president would propose turning Medicaid into a block grant system. Some GOP governors at the meetings last week, however, suggested a per capita approach that would explicitly require the federal government to incorporate enrollment changes when determining reimbursement rates.

J. Mario Molina, president of Molina Healthcare, told CQ Roll Call both Republican and Democratic governors are likely to push for a per capita approach because it would account for potential increases in each state’s Medicaid population.

“This is going to be a debate between the states and the federal government as to how best to continue this entitlement program while trying to rein in costs,” he said in a recent interview.

Others Republican governors, including Gov. John R. Kasich of Ohio, proposed lowering the Medicaid coverage threshold to 100 percent of the poverty level and allowing people with income above that amount to get exchange coverage. The law’s expansion provides Medicaid coverage for individuals up to 138 percent of the poverty level.

 

Patients Need Both Innovation and Accountability

September 29, 2016
1:42 pm

Let’s begin this post by stipulating the concept behind the creation of the Center for Medicare and Medicaid Innovation (CMMI) is both sound and important.

CMMI was created as part of the Affordable Care Act to test new payment and delivery mechanisms that have the potential to improve patient care while containing costs.  Given the healthcare system’s current movement toward value-based care, and the need to strengthen Medicare’s financial sustainability, having a CMMI to serve as a testing center for new ideas makes sense.

However, as the op-ed below by former Congressional Budget Office director Dan Crippen points out, CMMI has taken actions that go beyond the scope of what anyone would define as a limited demonstration project.  As Mr. Crippen writes, referring to a project affecting payment for drugs administered in a physician’s office, “Untested payment changes for Medicare benefits, especially when mandatory and applied to tens of millions of recipients, should receive much more consideration than a brief comment period before the initiation of the new policy.”

This is an issue about which we’re going to hear a great deal more in the weeks and months ahead.  The Medicare and Medicaid programs, and the millions of Americans they serve, need innovation to bring about care that is both high-quality and cost-efficient, but there also need to be built-in accountability guardrails having to do with the scope of projects and the transparency of decision-making.

Mr. Crippen is absolutely right in describing Patrick Conway, who heads CMMI, as a conscientious, effective public servant.  We look forward to working with him and elected lawmakers in Congress to assure that CMMI fulfills its intended mission in improving healthcare for current and future generations.

Here is the Dan Crippen op-ed:

I have the utmost respect for Patrick Conway, who heads the Center for Medicare and Medicaid Innovation at CMS, the federal agency that runs Medicare and Medicaid. Conway, like thousands of others in and out of government, is looking for ways to improve the health care of our nation.

However, action taken in the closing days of an administration, especially if it supersedes congressional authority and oversight, needs to be carefully examined. Last week, the House Budget Committee held a hearing taking a closer look at this with regard to CMMI and how the Congressional Budget Office evaluates costs associated with it, putting the CBO squarely in the middle of the struggle between the branches.

As recent proposals by CMMI to alter Medicare payments highlight, there are serious problems with the expansive reading of CMMI’s statutory authority. And the result is a significant shift of power from Congress to the executive branch.

The Affordable Care Act, which created CMMI, authorized CMMI to conduct demonstration projects for any part of Medicare and some of Medicaid, with the goal of saving money and improving quality. To conduct these experiments, the ACA allows the Secretary of HHS to waive virtually any part of Medicare and exempt a limited but important number of Medicaid provisions (e.g. the requirement that state Medicaid programs pay actuarially sound rates for managed care).

If HHS determines that a demonstration produces savings (or does not increase costs) and preserves or increases quality, it can expand the policy through rulemaking to the entire Medicare or Medicaid population. The process does not require any congressional approval or assessment, or review of the claims of savings and quality by the CBO or the Government Accountability Office.

With this process, HHS/CMMI can alter benefits and potentially reduce access for beneficiaries, and expose the federal budget to financial risks based on estimates generated solely by the executive branch. Given the uncertainty in savings and the somewhat nebulous definitions of quality in some of these demonstrations, it is not difficult to imagine that the use of this process could vary dramatically with changes of administration.

In a recent example, CMMI has proposed to change the Medicare payment system for drugs that treat diseases such as cancer and rheumatoid arthritis, which are administered in a doctor’s office. The new payments would go into effect on a mandatory basis in roughly half the country, but Medicare payments would be left unchanged in the other half. Payments, benefits, and potentially access to care, would depend on where the Medicare beneficiary lived. This approach is a nationwide policy experiment introduced unilaterally by the executive.

There are many reasons this new policy, and others like it, should receive congressional review before implementation. Untested payment changes for Medicare benefits, especially when mandatory and applied to tens of millions of recipients, should receive much more consideration than a brief public comment period before the initiation of the new policy. Whatever the good intentions, a major and mandatory change in payment is not something (most of) Congress contemplated.  In fact, many members of Congress have publicly expressed concern to HHS regarding this proposal.

To compound the problem, congressional budgetary rules generally impose a “pay-as-you-go” requirement. Since HHS claims the new policy will save money, any legislation to delay or modify CMMI’s proposals would likely be scored by CBO as lost future savings. Therefore, legislation to limit the experiment would have to be offset by cutting spending or raising revenues by an equal amount. Congress would be forced to “pay for” the delay or repeal of untested policy created by the executive branch.

As a former director of the CBO, I know firsthand how difficult it can be to estimate the impacts of regulatory changes. The assessment of new regulations (and scoring of legislation affecting them) is especially difficult — the effects are necessarily prospective and somewhat speculative. As CBO said last year:

(CBO) … expects that only a few (CMMI) models … will reduce program spending. However, CBO cannot predict which models will succeed, and CMMI has not operated long enough to determine its overall track record.

Given this shift in balance of power between the two branches, and the difficulty in measuring the true cost savings from any particular CMMI experiment, Congress should not set precedent by attempting to legislatively offset the cost of delay or repeal of any CMMI proposal, particularly if it has not gone into effect and there is no track record.

Having worked both in the Congress and the White House, I understand the frustrations and tensions between the congressional and executive branches. And at the end of an administration, which I also experienced, there is always unfinished business. As a member of the team that reviewed end-of-term proposals, I can confidently say this CMMI proposal is not one we would have approved. With limited ability for oversight under this framework, Congress should exercise its authority and halt this experiment until it can properly consider the effects of the proposed policy.

The Employment Aspect of the Medicaid Debate

January 20, 2015
1:00 pm

There has been plenty of discussion about the health coverage gap between the states that have expanded Medicaid eligibility and the 23 states that have, thus far, declined to do so. As a Kaiser Family Foundation study last December pointed out, about four million Americans living in states that have not altered their Medicaid thresholds have incomes that are above Medicaid eligibility but below the lower limit for tax credits to use for purchasing insurance in the health exchanges.

What has received less attention is the impact of the Medicaid debate on job creation. An article this week in the Dayton Daily News noted that about 7,000 new positions have been created in hospitals, physicians’ offices and other healthcare facilities in the first full year of Medicaid expansion in Ohio, an increase over the previous year’s job growth in the healthcare sector.

This is consistent with a Missouri study released last year which found that health sector job creation growth rates were significantly higher (2.1 percent versus 0.7 percent) in states that had expanded Medicaid eligibility versus those that haven’t.

The Healthcare Leadership Council has long maintained that expanding Medicaid is not the ideal tool, given its relatively low reimbursement rates and the number of physicians that are not accepting new Medicaid patients, for reducing the uninsured population. Making more individuals eligible for Medicaid, under the parameters of the Affordable Care Act, is preferable, though, to asking healthcare providers to bear larger uncompensated care burdens at a time when they are already absorbing ACA payment cuts.

We continue to urge the Obama Administration to be flexible toward the innovative steps a number of states are taking to expand coverage to more low-income citizens.