Cutting health care costs through better care delivery

[Greenbeard]

It's why the Intermountain folks noted that even for them, value improvements have been accompanied by financial penalties.

Tell me something, why does making a profit cost a company money?

Are you taking the phrase "value improvement" to be synonymous with "profit"? If so, why?

The regulations that are written by bureaucrats in Washington are nuetral or negative toward quality, and actually tend to pay more when providers deliver poor quality than they do for high quality. In other words, they are designed to limit profit by paying companies to deliver bad service. These regulations were written with the goal of increasing quality and making costs lower. Yet, as you have just argued, they actually do just the opposite.

None of the sentences you've written have any logical relationship to each other. Beyond being mutually contradictory, that is (quality-neutral payment policies cannot, by definition, be "written with the goal of increasing quality").

Presumably you're referring to this:

In the Medicare program, the payment system is largely neutral or negative towards quality. All providers meeting basic requirements are paid the same regardless of the quality of service provided. At times providers are paid even more when quality is worse, such as when complications occur as the result of error.​

At this point I have to stop and congratulate you. It took 4 pages but you've stumbled over the theme of this thread (one I've mentioned explicitly multiple times now): current payment policy (in both the public and private sector) often doesn't reward value improvements, i.e. increasing quality relative to costs. That's precisely because they weren't designed to reward value. Which means, as MedPAC was kind enough to point out in that 2003 report, those payment policies have to change. Those recommendations weren't acted on in any large-scale fashion until 2010 but now legislative action has been taken paving the way for exactly that.

It's not clear whether you're arguing for retaining the status quo and hoping for the best, or for ending Medicare. Presumably it's the latter. Shocking.

 

[Greenbeard]

Canuck, make your own thread. This stuff is unrelated to what this thread is about.

 

[Quantum Windbag]

Are you taking the phrase "value improvement" to be synonymous with "profit"? If so, why?

Because the only real value a private company has is profit.

None of the sentences you've written have any logical relationship to each other. Beyond being mutually contradictory, that is (quality-neutral payment policies cannot, by definition, be "written with the goal of increasing quality").

Are you trying to say that if someone writes a regulation with the intent of increasing quality it always works?

Presumably you're referring to this:

In the Medicare program, the payment system is largely neutral or negative towards quality. All providers meeting basic requirements are paid the same regardless of the quality of service provided. At times providers are paid even more when quality is worse, such as when complications occur as the result of error.​

At this point I have to stop and congratulate you. It took 4 pages but you've stumbled over the theme of this thread (one I've mentioned explicitly multiple times now): current payment policy (in both the public and private sector) often doesn't reward value improvements, i.e. increasing quality relative to costs. That's precisely because they weren't designed to reward value. Which means, as MedPAC was kind enough to point out in that 2003 report, those payment policies have to change. Those recommendations weren't acted on in any large-scale fashion until 2010 but now legislative action has been taken paving the way for exactly that.

Which is why we should remove the government from any attempt to reform private health care. don't you think? The government cannot reward value, all they can reward is compliance with regulations.

It's not clear whether you're arguing for retaining the status quo and hoping for the best, or for ending Medicare. Presumably it's the latter. Shocking.

I obviously want the status quo. That is evident by me continually pointing out that we need to let private companies loose to make a profit and not require them to comply with more government regualtions that are designed to reduce costs.

 

[boedicca]

... and ...

Meanwhile, according to author Terry Boychuk, the rest of the industrialized world, including many developing countries like Mexico, Korea, and India, viscerally understood that "private insurance would [never be able to] cover all necessary hospital procedures and services; and that even minimal protection [is] beyond the reach of the poor, the working poor, and those with the most serious health problems."

1 Today, over half the family bankruptcies filed every year in the United States are directly related to medical expenses, and a recent study shows that 75 percent of those are filed by people with health insurance.

2 The United States spends far more per capita on health care than any comparable country. In fact, the gap is so enormous that a recent University of California, San Francisco, study estimates that the United States would save over $161 billion every year in paperwork alone if it switched to a singlepayer system like Canada's.

3 These billions of dollars are not abstract amounts deducted from government budgets; they come directly out of the pockets of people who are sick.

That nonsense about bankruptcies has been debunked.

Most people who file for bankruptcy have some unpaid bills. Any one who owed even a little bit owned to a doctor, hospital, clinic, etc. is counted in that 50% figure.

 

[Greenbeard]

Because the only real value a private company has is profit.

Oy. If you're not understanding how words are being used in the context of this thread, it's going to be very heard for you to digest it. "Value" here means something specific.

Are you trying to say that if someone writes a regulation with the intent of increasing quality it always works?

I'm trying to say (or rather, I did say) that payment policies written to be quality-neutral are not written with the intent of improving quality. Thus it shouldn't be a surprise when they don't improve quality.

Which is why we should remove the government from any attempt to reform private health care. don't you think? The government cannot reward value, all they can reward is compliance with regulations.

Reactionary fortune cookie wisdom. Payer reimbursement structures determine whether and how much value improvements are rewarded. It makes no difference whether the payer is public or private.

I obviously want the status quo. That is evident by me continually pointing out that we need to let private companies loose to make a profit and not require them to comply with more government regualtions that are designed to reduce costs.

Right, I conceded it was more likely your point is that Medicare should be eliminated.

 

[Flopper]

Well it looks like things are changing. Hospitals will be paid more for better care.

The U.S. Department of Health and Human Services has launched a program that will reward hospitals for providing high-quality care to Medicare patients and reducing health care costs.

Authorized by the Affordable Care Act, the Hospital Value-Based Purchasing program marks the beginning of a change in how Medicare pays health care providers and facilities. For the first time, 3,500 hospitals across the country will be paid for inpatient acute care services based on care quality, not just the quantity of the services they provide.

The program helps support the goals of the Partnership for Patients, a new public-private partnership that aims to improve the quality, safety and affordability of health care for all Americans. The Partnership for Patients says it has the potential over the next three years to save 60,000 lives and save up to $35 billion in health care costs, including up to $10 billion for Medicare. Over the next 10 years, the partnership says the program could reduce costs to Medicare by about $50 billion and result in billions more in Medicaid savings.

The U.S. spends almost $6.2 billion per day on health care costs, according to the Kaiser Family Foundation. And 20 percent of those costs, according to the Department of Health and Human Services, are covered by Medicare.

In 2013, an estimated $850 million will be allocated to hospitals based on their overall performance on a set of quality measures that have been shown to improve clinical processes of care and patient satisfaction. This funding will be taken from what Medicare otherwise would have spent, and the size of the fund will gradually increase over time and result in a shift from payments based on volume to payments based on performance.

The better a hospital does on its quality measures, the greater the reward it will receive from Medicare.

Medicare program to reward hospitals for quality care » Columbia Business Times; The leading source of local business coverage in Columbia, MO

 

[Greenbeard]

I think the best and most economical healthcare comes from an integrated systems such as Intermountain Healthcare. A system in which primary care doctors, specialist and other healthcare professionals work for the same organization offers tremendous opportunities for cost reductions and improved patient care. I am familiarly with one such organization. Your primary care doctor is the focus of your medical care. When you go to see the doctor, the computer beside him has the result of all test you have had, all prescriptions from all doctors, notes, and diagnosis. If you have a potentially serious problem, the primary care arranges for tests and refers you to a required specialist if needed. You don't get a prescription, referral, or test every time you go to the doctor. They do what is needed not necessarily what the patient wants. That's not usually the case with doctors that have private practices. If the patient doesn't get what he wants, he finds another doctor. So the patient gets a bunch prescriptions, referrals, and tests often for ailments that would resolve themself with little or no medical care.

I'm with you up until the end there. I think it's useful to organize your thinking about quality around three design principles for quality care (introduced by the Institute of Medicine) that I outlined in another thread: knowledge-based care, systems-minded care, and patient-centered care.

That last one, patient-centered care, is built into some of the examples I've sprinkled into this thread (e.g. the patient-centered medical home model Mayo is playing with or Geisinger's 24-hour telenurses), and in part I think it's built into the concept of the primary-care-physician-as-care-coordinator that you mention. But implicit in the notion of patient-centeredness is the idea that patients don't simply delegate to doctors or grant them virtual decision-making autonomy, but rather their needs and wishes are factored into a shared decision-making process.

So I'd argue that many of these delivery system innovations here are at least partly built around patient empowerment, not attempting to curb unnecessary utilization by taking decision-making out of the patient's hands. It's a tricky area because it obviously gets directly at the question of what the role of a doctor should be and what the doctor-patient relationship should look like. But I personally tend to favor the framework laid out in that other thread.

 

[Quantum Windbag]

Oy. If you're not understanding how words are being used in the context of this thread, it's going to be very heard for you to digest it. "Value" here means something specific.

Yes, as profit.

From your link.

Value should always be defined around the customer, and in a well-functioning health care system, the creation of value for patients should determine the rewards for all other actors in the system. Since value depends on results, not inputs, value in health care is measured by the outcomes achieved, not the volume of services delivered, and shifting focus from volume to value is a central challenge. Nor is value measured by the process of care used; process measurement and improvement are important tactics but are no substitutes for measuring outcomes and costs.
Since value is defined as outcomes relative to costs, it encompasses efficiency. Cost reduction without regard to the outcomes achieved is dangerous and self-defeating, leading to false “savings” and potentially limiting effective care.
Outcomes, the numerator of the value equation, are inherently condition-specific and multidimensional. For any medical condition, no single outcome captures the results of care. Cost, the equation’s denominator, refers to the total costs of the full cycle of care for the patient’s medical condition, not the cost of individual services. To reduce cost, the best approach is often to spend more on some services to reduce the need for others.

Summing all that up, value is profit for the private company. If they try to deliver value by doing anything other than making a profit they will eventually go out of business. That is why I actually specified a private company when I made the post you took exception to.

I'm trying to say (or rather, I did say) that payment policies written to be quality-neutral are not written with the intent of improving quality. Thus it shouldn't be a surprise when they don't improve quality.

They were not written to be quality neutral, they are quality neutral because they were written to meet requirements that are outdated. The same thing will happen with the new regulations at a point in the future where technology progresses beyond the point that these regulations are written to deal with.

This not only should not be a surprise, it is not a surprise when you deal with the government.

Reactionary fortune cookie wisdom. Payer reimbursement structures determine whether and how much value improvements are rewarded. It makes no difference whether the payer is public or private.

Can you provide any data points to support that? You certainly provided enough to prove that ignoring the government imposed regulations is ultimately better for the patient,l and the company.

Right, I conceded it was more likely your point is that Medicare should be eliminated.

You prefer to keep a system that will be bankrupt before people that are currently paying into it will have a chance to benefit? Even Obamacare recognizes that is not possible, which is why it effectively eliminates it as it exist today. Your problem is you want to accuse me of wanting to eliminate it while refusing to admit that, as an advocate of Obamacare, you also want to eliminate it.

 

[Quantum Windbag]

I think the best and most economical healthcare comes from an integrated systems such as Intermountain Healthcare. A system in which primary care doctors, specialist and other healthcare professionals work for the same organization offers tremendous opportunities for cost reductions and improved patient care. I am familiarly with one such organization. Your primary care doctor is the focus of your medical care. When you go to see the doctor, the computer beside him has the result of all test you have had, all prescriptions from all doctors, notes, and diagnosis. If you have a potentially serious problem, the primary care arranges for tests and refers you to a required specialist if needed. You don't get a prescription, referral, or test every time you go to the doctor. They do what is needed not necessarily what the patient wants. That's not usually the case with doctors that have private practices. If the patient doesn't get what he wants, he finds another doctor. So the patient gets a bunch prescriptions, referrals, and tests often for ailments that would resolve themself with little or no medical care.

I'm with you up until the end there. I think it's useful to organize your thinking about quality around three design principles for quality care (introduced by the Institute of Medicine) that I outlined in another thread: knowledge-based care, systems-minded care, and patient-centered care.

That last one, patient-centered care, is built into some of the examples I've sprinkled into this thread (e.g. the patient-centered medical home model Mayo is playing with or Geisinger's 24-hour telenurses), and in part I think it's built into the concept of the primary-care-physician-as-care-coordinator that you mention. But implicit in the notion of patient-centeredness is the idea that patients don't simply delegate to doctors or grant them virtual decision-making autonomy, but rather their needs and wishes are factored into a shared decision-making process.

So I'd argue that many of these delivery system innovations here are at least partly built around patient empowerment, not attempting to curb unnecessary utilization by taking decision-making out of the patient's hands. It's a tricky area because it obviously gets directly at the question of what the role of a doctor should be and what the doctor-patient relationship should look like. But I personally tend to favor the framework laid out in that other thread.

Of course you do, because the only thing that can possibly work is if it is something your masters like.

 

[Oddball]

Just for the record, Intermountain is still a private for-profit enterprise...Right?

 

[Greenbeard]

They describe themselves as a community-owned, nonprofit health care organization.

 

[Oddball]

Lots and lots of people involved in so-called "non-profits" make quite comfortable livings.

Point being that they're not mandated and are, as much as is practicable, operating independently of any gubmint bureaucratic structure.

 

[Flopper]

I think the best and most economical healthcare comes from an integrated systems such as Intermountain Healthcare. A system in which primary care doctors, specialist and other healthcare professionals work for the same organization offers tremendous opportunities for cost reductions and improved patient care. I am familiarly with one such organization. Your primary care doctor is the focus of your medical care. When you go to see the doctor, the computer beside him has the result of all test you have had, all prescriptions from all doctors, notes, and diagnosis. If you have a potentially serious problem, the primary care arranges for tests and refers you to a required specialist if needed. You don't get a prescription, referral, or test every time you go to the doctor. They do what is needed not necessarily what the patient wants. That's not usually the case with doctors that have private practices. If the patient doesn't get what he wants, he finds another doctor. So the patient gets a bunch prescriptions, referrals, and tests often for ailments that would resolve themself with little or no medical care.

I'm with you up until the end there. I think it's useful to organize your thinking about quality around three design principles for quality care (introduced by the Institute of Medicine) that I outlined in another thread: knowledge-based care, systems-minded care, and patient-centered care.

That last one, patient-centered care, is built into some of the examples I've sprinkled into this thread (e.g. the patient-centered medical home model Mayo is playing with or Geisinger's 24-hour telenurses), and in part I think it's built into the concept of the primary-care-physician-as-care-coordinator that you mention. But implicit in the notion of patient-centeredness is the idea that patients don't simply delegate to doctors or grant them virtual decision-making autonomy, but rather their needs and wishes are factored into a shared decision-making process.

So I'd argue that many of these delivery system innovations here are at least partly built around patient empowerment, not attempting to curb unnecessary utilization by taking decision-making out of the patient's hands. It's a tricky area because it obviously gets directly at the question of what the role of a doctor should be and what the doctor-patient relationship should look like. But I personally tend to favor the framework laid out in that other thread.

I think patient empowerment should really depend on the patient. When faced with serious illness, some patients want lots of options in their care. They want to make the decisions because it's their life. However, a lot patients ask the doctor, what do think I should do? They don't want to be empowered. They just want somebody to tell them what to do.

 

[Flopper]

Lots and lots of people involved in so-called "non-profits" make quite comfortable livings.

Point being that they're not mandated and are, as much as is practicable, operating independently of any gubmint bureaucratic structure.

Non-profit is really a tax terminology. Many insurance companies and hospitals are non-profit and they make lots of money, meaning their revenue is more than their expenses. It's what you do with the money after you make it that determines whether you are a non-profit. The money can go into expansions, and improvements. Salaries can be just as high in a non-profit as a for profit organization.

 

[Flopper]

Lots and lots of people involved in so-called "non-profits" make quite comfortable livings.

Point being that they're not mandated and are, as much as is practicable, operating independently of any gubmint bureaucratic structure.

62% of the hospitals are nonprofit and now most people get their private insurance from a nonprofit organization. Government pays over half our healthcare cost. The price of medical procedures are not determined by the free market but rather Medicare/Medicaid reimbursement rates and insurance networks. When the prices in an industry are no longer determined by the free market and the profit motive is no longer the primary motivating factor, then that industry has been socialized. Government is not becoming the owner and operating in the healthcare industry, but rather community foundations are.

The healthcare industry is being socialized, not by government ownership but rather community ownership which I don't think is necessarily a bad thing.

 

[Greenbeard]

I think patient empowerment should really depend on the patient. When faced with serious illness, some patients want lots of options in their care. They want to make the decisions because it's their life. However, a lot patients ask the doctor, what do think I should do? They don't want to be empowered. They just want somebody to tell them what to do.

No doubt that at present there's a cultural bias toward a principal-agent relationship where a significant amount of the patient's autonomy is ceded to the physician. That's all the more reason to wring the incentives for more and more volume out of the payment structure. If the system encourages dubious health services, it's hard to blame the individual--physician or patient--for getting caught up in it.