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Documenting the Better Care, Lower Cost Advantages of Medicare Advantage

September 03, 2015
11:59 am

A study published in this month’s edition of the American Journal of Managed Care brings hard data to an argument many of us have been making for some time, that private Medicare Advantage plans are doing a superior job of delivering high-quality care at less cost than traditional Medicare.

The study, led by Dr. Bruce E. Landon of the Harvard Medical School and funded by a grant from the National Institute on Aging, examined price-standardized resource usage and care delivery for patients with diabetes or cardiovascular disease in both Medicare Advantage plans and traditional fee-for-service Medicare.  The takeaways from the study included:

•    For both health conditions examined, relative resource use was lower in Medicare Advantage plans than it was in traditional Medicare

•    Although there was variation among individual plans, quality of care for diabetes and cardiovascular disease was higher in Medicare Advantage plans.

The study concludes, “Proponents of managed care have long argued that integrated health plans can deliver care more efficiently than traditional fee-for-service care by using their ability to tailor their provider networks to the needs of their population and to implement disease and case management programs to improve chronic disease management.  In this large national study of enrollees with diabetes or cardiovascular disease, our findings suggest that many Medicare HMO health plans are able to deliver care of equal or better quality with lower (resource usage) than traditional Medicare.”

These findings, I would add, echo what we hear at the Healthcare Leadership Council on a regular basis from not only our health plan members, but also from hospital leaders – that, in terms of attacking chronic disease in a cost-efficient way, Medicare Advantage has a strong upper hand over conventional Medicare.

The Exciting Movement Toward “Person-Centered Care”

May 20, 2015
11:46 am

American healthcare is evolving in ways that are both beneficial and necessary.  With an imperative to move toward a healthcare system that offers both high quality and cost-efficiency, the answer lies in finding better ways to keep people healthy.

In an interview with Hospital and Health Networks magazine, Ascension CEO Tony Tersigni (Ascension is the nation’s largest nonprofit healthcare system and a member of the Healthcare Leadership Council) explains how his organization is transitioning from “patient-centered care” to “person-centered care.”

This is one of the most enlightening quotes from the interview – “And so we see ourselves moving from physician-centered to person-centered, from transactional and episodic care to managed care by a team over time, from the idea of sick care to well-being.  We’re moving from care that’s inaccessible and tied to bricks and mortar to care that’s going to be convenient and available 24/7/365.”

Here is the full text of the Tersigni interview.

What is this idea of person-centered care at Ascension?

TERSIGNI: We view person-centered care as our sacred promise to support individuals’ lifelong health and well-being through holistic care. It’s something that goes back to our roots. We have a 200-year legacy of caring for the whole person — body, mind and spirit. We recognize that each person represents a unique individual biologically, psychologically and sociologically. We believe, as care develops in the future, it’s going to become much more personalized than it has been in the past. Bottom line, the emphasis on person-centered care is our way of demonstrating the commitment that our founders have had for the last 200 years.

Why is this driving the conversation at your organization?

TERSIGNI: It is our strategic direction. I might say we’ve been on this path since 2002. At that time, we created our “call to action.” It is pretty basic and simple: We are going to promise the communities that we serve health care that works, health care that’s safe and health care that leaves no one behind. Then we figured that, in order for us to do it, we needed to have four different foundational blocks. One is hired people — the people who serve those we’re privileged to serve. The second is developing trusted partnerships along the continuum. Empower knowledge, which is much more relevant today than it was in 2002. And then having this vital presence everywhere around the community.

That’s basically been the foundation of what Ascension has been. As we look at other industries, individuals have choices and options in every aspect of their daily lives, and we know that access to more and timely information really increases their options. That’s really what we’re trying to bring to Ascension and health care, and that’s how we’ve refined that focus over time.

Is “patient” not encompassing enough?

TERSIGNI: Actually, you hit the nail right on the head. We chose person-centered care because, again, it’s really focused on the person and, in many cases, they’re not patients, especially if we speak about health education and wellness. We typically don’t think of them as patients, but really as consumers. While other systems are caring for patients, we make a conscious effort to talk about providing person-centered care that’s focused on persons not on patients.

Is that difficult in such a provider-centered industry?

TERSIGNI: We’re challenging ourselves to move into health care transformation, and we believe that the first phase is seeing person-centered care. What I mean by that is we’re seeing health services being redesigned around the person, helping individuals to become participants in managing their own lives. We’re seeing care teams becoming more multidisplinary and we envision they’ll ultimately include professionals like nutritionists, social workers, coaches and partners for health. We also see that the economic model will become population based and will reward value. We’re seeing that now. And so we see ourselves moving from physician-centered to person-centered, from transactional and episodic care to managed care by a team over time, from the idea of sick care to well-being. We’re moving from care that’s inaccessible and tied to bricks and mortar to care that’s going to be convenient and available 24/7/365. There’s a lot of transformation that we believe has come and is coming to our health care industry. We want to be on that bandwagon as we move forward, because we need to move toward evidence-based standards and away from what we’ve seen in our industry is a lot of unwarranted variation. It’s a monumental transformation.

How will being person-centered help in the shift to value?

TERSIGNI: We believe we need to bring health care and health services closer to the home. We need to bring information to the persons we serve on mobile devices they use in their daily lives. Last year, if you look at [Ascension’s] total $21 billion in revenue, 51 percent of that came from non-acute care services. While people see us as a large hospital system, which we are, we’re a lot more than that. We’ve recognized that the health care landscape is changing and there are opportunities for us. So what we’ve been doing along the way is really identifying the continuum of care, the partners that we need across the continuum, and looking at the longitudinal care that we’re going to provide under population health management.

Why is clinical integration key to person-centered care?

TERSIGNI: We believe that, through clinically integrated systems of care, we can enable quality improvements and increase cost-effectiveness. That’s basically what clinically integrated systems of care are. It says that we are going to use the resources within the community to raise the quality of care of the community, and, in many cases, it’s going to be partnering with others. That’s why, when I first stated our call to action, one of the foundational components is trusted partners. We know we can’t do it alone and so we’re going to need partners along that full continuum.

What do people want from person-centered care?

Tersigni: We’ve done a lot of focus groups over the last few years as we’ve refined our strategic direction, and they revealed four different areas. They want us to respect them, they want us to include them, they want us to connect them, and they want us to engage them. They say: Respect me. Those who care for me know me, understand what’s important to me and treat me with respect and communicate in a way that I can understand. They say: Include me. Those who care for me actually are listening to me, include my family and others I trust in my care, and work as a team in providing care that’s holistic — body, mind and spirit. I want to be connected to reliable health information that’s relevant to me and networks of people like me. People with chronic diseases want to be socially connected with other people who have those same chronic diseases so they can have a social dialogue in terms of what’s happening in their lives. The last piece is: Engage me. I engage in the decision-making with my trusted partners. Those are the four goals that we’ve been trying to achieve in the voice of the customer. It’s really all about creating a healthier community.

What is Ascension’s eventual destination point?

Tersigni: Our destination point is to develop the capabilities to take care of millions of lives from birth to death. That’s what person-centered care is all about; that’s what our call to action was when we created it; and that’s where our growth is focused. The bottom line for me is, while we’ve made great strides in accomplishing our call to action, our job is not done. We still have more to do in promising the communities we serve health care that works, health care that’s safe and health care that leaves no one behind.

Dr. Murthy’s Mission

May 01, 2015
2:25 pm

Last week, Dr. Vivek Murthy, the new U.S. Surgeon General was officially sworn into office.  In his speech to the ceremony attendees, Dr. Murthy described his mission for a stronger and healthier America.  He discussed roadblocks to better population health such as a culture focused on treatment rather than prevention, the spread of incorrect health information and unhealthy behaviors that are entrenched in society and difficult to change.  Addressing these issues, he said, is a shared responsibility requiring partnerships involving diverse interests and perspectives.

The Healthcare Leadership Council is proud to be a part of that partnership.  In fact, one of the Surgeon General’s first public appearances in Washington, DC was at a forum HLC hosted on anti-obesity initiatives.  At that forum, he joined with HLC member companies – Weight Watchers, Takeda Pharmaceuticals, Health Care Service Corporation and the Cleveland Clinic – to discuss the steps that are being taken to help more Americans understand the importance of and how to achieve healthy body weight.   Dr. Murthy spoke compellingly about the need to create a culture that encourages healthier lifestyles.

The good news is that important strides are being made in developing that culture.  In communities throughout the country (note Oklahoma City’s collective million-pound loss spotlighted at the HLC anti-obesity event), we’re seeing successes in establishing improved health and well-being.   Healthcare companies, including many of our HLC members, are taking innovative steps to incentivize better nutrition and exercise habits.  Many of these success stories are detailed in our publication, The Future is Here: Transforming American Healthcare Through Private Sector Innovation.

The need for progress is great.  As was mentioned several times at our recent event, the percentage of Americans classified as obese has nearly tripled since the 1960s.  This is taking an enormous toll not only on our well-being as a society, but also on the economic sustainability of our healthcare systems.   We need to learn from the successes that have been established, and then build on them.   On that note, we’re certainly aligned with our new Surgeon General.

The Lasting Resonance of a Summit on Health Care Value

March 18, 2015
11:41 am

On March 2, the Healthcare Leadership Council, as part of its National Dialogue for Healthcare Innovation (NDHI) initiative, brought together over 70 leaders from organizations and institutions that design, implement and are affected by the U.S. healthcare system.  The purpose was to clearly define what constitutes value in healthcare and to begin crafting a pathway that will allow patients and consumers access to life-changing healthcare innovations within a structure that is affordable and financially sustainable.

The Summit on Value and Innovation was just the first step in what will be an ongoing dialogue designed to identify and address the existing barriers to health system improvement.  Summit participants have expressed their intention to continue working toward the goals and objectives they outlines on March 2.

Here are some highlights of the comments and coverage of the NDHI Summit:

“Last week I had the opportunity to sit at the table with some of the nation’s top thought leaders. We convened at the Newseum in Washington, DC, for the Healthcare Leadership Council’s National Dialogue for Healthcare Innovation; it was like a health policy nerd red carpet. Center for Medicare Director Sean Cavanaugh was there. Leapfrog Group CEO Leah Binder was there. America’s favorite bioethicist–oncologist–provocateur Zeke Emanuel was there. The chief executives of providers, payers, pharmaceutical companies, government agencies—all there. And what were they there to do? Define “value” in health care.”

–Neel Shah, M.D., Executive Director, Costs of Care in the AAMC Wing of Zock blog

***

“In order to improve value, we needed to identify some of the obstacles that could thwart progress. Regulatory and policy challenges; trust between stakeholders; insufficient time for measurement and lack of tools for patients to make healthcare decisions were among the barriers we cited.

“To surmount those obstacles, we honed in on several key initiatives: piloting a payment model that incentivizes value and shares risk among stakeholders; mapping the patient journey to better understand how we as stakeholders can work together, rather than focusing on our individual part of a patient’s healthcare experience; and developing medication adherence programs to educate patients on their disease, therapies and treatment goals.”

–Greg Irace, Senior Vice President of Global Services, Sanofi US

***

Several participants said that the Medicare Advantage system does a good job of aligning incentives to produce high-quality care and good value. Barry Arbuckle, president and chief executive officer of MemorialCare Health System, which operates hospitals and provider groups as well as a health plan in the Los Angeles area, said, “If I could push every Medicare patient into Medicare Advantage, I’d do it tomorrow.”
Medicare Advantage is “a fundamentally better system. The financials are aligned. We have incentives to do disease-management programs. Frankly I don’t have that in Medicare, because I get paid when they get sick. And if they’re sicker, I get paid more,” Arbuckle said.

It’s more challenging to address these issues for the commercially insured population, Arbuckle said. Having a long-term relationship with members is crucial to the success of creating better health-care value, he said.

–Coverage in Bloomberg BNA, March 3, 2015

Aetna CEO: New Math for Medicare

October 22, 2014
5:02 pm

(We have made the point often in this space that, even with the private sector’s successes in containing healthcare costs and reducing Medicare per-capita spending to historic lows, the sheer magnitude of baby boomers reaching 65 and reaching Medicare eligibility necessitates significant changes to the program.  Moving away from a fee-for-service model that incentivizes volume rather than value is essential.  As Mark Bertolini, CEO of Aetna (a Healthcare Leadership Council member) points out in this Forbes op-ed column, innovative approaches to Medicare payment and healthcare delivery can achieve better patient health and improved system sustainability.)

By Mark T. Bertolini

The Medicare Part A trust fund will be exhausted by 2030. As 11,000 baby boomers become eligible for Medicare daily, Medicare spending is projected to exceed $1 trillion in 2020. We can’t change the numbers that define our population but, we can apply new math to them.

Focus first on helping the chronically ill

The sickest 5 percent of fee-for-service Medicare patients with chronic conditions drive more than 40 percent of the total cost of health care in the program. We should use the lessons learned in Medicare Advantage and other proven innovations. Encourage Medicare Part A and B enrollees with multiple chronic conditions to participate in new integrated care programs with top-notch physicians to ensure high-quality service. Pay managed care organizations rates that guarantee savings for taxpayers out of the gate.

Use the successes and learnings of this approach to phase out the Medicare fee-for-service payment model

The fee-for-service model has doctors getting paid by the number of procedures they do or tests they run, rather than on how well their patients do. We need to move to a system that pays for quality over quantity.

These two changes alone will mean lower cost coupled with better integrated, quality care for the members of our families that need that care the most.

While the Congressional Budget Office recently reported that estimated costs of Medicare and Medicaid have dropped, our country’s coffers are still being drained by a too-costly health care system. This was reconfirmed in July, when the Boards of Trustees of the Federal Hospital insurance and Federal Supplementary Medical Insurance Trust Funds projected that Medicare costs will grow from their current level of 3.5 percent of the gross domestic product (GDP) to at least 5.3 percent of the GDP in 2035.

Consider this: As baby boomers become Medicare eligible, the number of beneficiaries will grow from 50.7 million in 2012 to 81 million in 2030—a 60 percent increase in less than 20 years. Add to this that the tax base is shrinking: Baby boomers are retiring, leaving the country with a much smaller workforce paying a much higher Medicare tax burden. With average life expectancy projected to reach 81.5 years by 2030, on average those seniors will use Medicare benefits for three times as long as when Medicare was enacted in 1965. Chronic conditions among Medicare beneficiaries also are on the rise, making them a sicker and more expensive population than existed in 1965.

The current fee-for-service payment model unintentionally incentivizes the wrong kinds of behaviors—spending less time with patients, or having more tests and procedures. There is little reward for finding more efficient ways to make people better or for keeping them healthy in the first place.

Bringing innovative collaboration to traditional Medicare

Many programs that have been so effective for caring for Medicare Advantage’s sickest beneficiaries, including enhanced home-based care, care coordination and medication review, are not always covered under traditional Medicare. Our experience in Medicare Advantage shows the promise of these models. For several years, we have worked with health care providers to establish reimbursement models based on risk-sharing that encourages higher-quality performance. Aetna Aetna’s Medicare Advantage Provider Collaboration program, and its work to create accountable care organizations (ACOs), are examples of cooperative arrangements that are improving care quality and health outcomes while also reducing costs. In many instances, these programs have resulted in fewer inpatient hospital days, fewer hospital admissions and fewer readmissions for patients, which can reduce health care costs by as much as 30 percent.

Bringing innovative provider collaborations and managed care approaches to traditional Medicare is a winning proposition for everyone. Patients could get a full team of experts providing customized and focused attention, and be rewarded with incentives for adhering to treatment. Doctors could get greater support, information and resources to help their patients get and stay healthy. Managed care companies could serve a broader Medicare population, as long as they meet the required quality and outcomes results. Taxpayers could get a lower-cost, better-quality healthcare system.

In the past, we have shied away from making significant changes to Medicare, since the issues seemed to be so far down the road. That is no longer the case. Our Medicare spending has a tremendous impact on our economy now, and that will only increase over the next decade. Our population is aging too quickly and our nation’s Medicare costs are growing too rapidly for us to be timid. We need to take dramatic action now, and revolutionize how we approach the problem. The numbers can work if we are ready to adopt a new model. We can achieve a result that includes both healthier seniors and a lower tax burden.