Bridging Business & Healthcare : Healthcare Management Consultants for Dispute Resolution, Valuation & Clinical Compliance

In yesterday’s Wall Street Journal, Tennessee Governor Phil Bredesen presented a well-written argument to show how many employers may benefit financially under the new healthcare law by no longer providing insurance coverage to their employees as a direct benefit of employment. Today, Louisiana Governor Bobby Jindal announced that his state would delay changes to the Medicaid system that would have made care available to thousands of the poorest citizens of his state due to opposition from many hospitals there. 

As I read both of these pieces, I couldn’t help but notice something, or should I say someone, continues to be conspicuously absent from these discussions. Throughout Governor Bredesen’s piece he refers to “coverage,”“plans,” and “employers” caring for patients. Governor Jindal’s plan refers to “coordinated care networks” caring for patients. Networks, plans, and employers do not care for patients – physicians do. 

As politicians and businesses scramble to try to define and implement the new normal, physicians continue to be seen at only at the end of every story, simply reacting to each new twist in interpretation of the law as it is imposed. With few exceptions, physicians seem to be content to follow the actions of others.

I am not calling for a massive rebellion on the physician front, but simply for individual physicians to begin to take a leadership role in the process. Ask most physicians and they will agree that the current delivery system is unsustainable and that changes must be made. If we as physicians want to be more than a footnote in this process, then we must begin to take a more active role in shaping it as it unfolds.

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This morning United Health Care announced its new Cancer Care Payment Pilot. According to UHC, this pilot is designed to “advance a new cancer payment model that focuses on best treatment practices and better health outcomes.” As a matter of fact, most agree that the cost of treating cancer under the current model is unsustainable. As evidence for this position, Dr. Michael Neuss, an oncologist from Cincinnati, described existing payment plans that reward physicians for using expensive chemotherapy medications as “our dirty secret” in today’s New York times. In this world of the “new normal” of healthcare reform, I am “all for” exploring new models of care that attempt to provide the best care at the best price, but that does not appear to be the true goal of this model.

In reviewing the details of the model as outlined by UHC, this new pilot will reimburse providers utilizing a bundled payment plan based on the “expected cost” of treating a patient. The physician will choose the care plan, but all reimbursement will be independent of the drugs that are chosen to treat the patient. Basically, the physician will get a flat fee for what it should cost for him/her to see the patient in the office, plus a bit of a bump for case management and drug administration. The drugs will be reimbursed at cost, removing any profit incentive for the physician.

So far so good right? Not so fast. Although the disincentive for profiting on medications may lead to lower costs, what incentive will there be for truly improved quality and better care? Reading on in UHC’s press release, they do mention that they will be measuring the number of emergency room visits  (a cost measure), the incidence of complications (a cost/quality measure), and “health outcomes.” Exactly how they will be measuring outcomes is not said.

Even if you give UHC the benefit of the doubt that they are going to create robust, meaningful, outcomes-based quality metrics (which I am admittedly skeptical of), they have missed the boat on one very important piece of this equation. None of these quality metrics appear to be tied in any way to the physician’s income. How much the physician is paid is tied solely to the time likely to be spent caring for the patient – a bundling of expected fee for service payments, nothing more.

Creating appropriate incentives for any behavior is complicated, but B.F. Skinner showed long ago that negative reinforcement is short-lived. If you desire to have long-term change, you must reinforce a desired behavior. We must create new models that help us reign in cost. However, without including positive financial incentives that reward the best care, we will simply end up with another band-aid approach that rewards the payer, frustrates the physician, and fails to provide incentives to improve the outcomes of those at the center of care, the patients.

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Last week the healthcare world was all abuzz. The federal government was set to begin the journey that every player in the marketplace has been waiting for, the road to the accountable care organization. Over 300 industry leaders gathered in Baltimore to hear just how this was going to occur, to hear the “new normal.”  Well… that’s not exactly what was heard. Although there were some mentions of changes to safe harbors and inclusion of all players, not a lot of new and different ideas were shared. While following those who were live tweeting the event, comments like “..is an ACO a PHO without the H?” and “Without antitrust legislation, we’ll have only large hospital networks remaining..”  and even “..capitation is on the horizon” were the norm of the conversation.

The closer we get to implementation of this “new” model, the more similar it appears to ideas that have been tried (and failed) before. It seems we have not yet developed the appetite for a model that is new and truly different.

Apple’s iPad has been out for less than a year.   It is anticipated that within the year it will have its own category of electronics, and will outsell netbooks by a large margin within the next two years. The iPad was expected to do well, but not this well. The iPad, like healthcare reform, was promoted as something new and truly different. But the iPad was not only new and different, it was also better for the customer…at least at some things. It made doing things that customers truly wanted to do (get information fast) better and easier, even at the cost of not being as good at others (word processing, gaming, etc.).

In an article in Kaiser Health News this morning, the author outlines how many industry players are lining up to make ACO’s work – not for the patient, our customers, but for them, the providers of services. These industry insiders all seem to be afraid of what they might have to give up under this new model of care, and are looking to make sure they maximize their own gains. There may be a lesson for us to learn from our friends at Apple. If we truly want to improve our model of care, we are going to need to give some things up. Everything cannot stay the same with different titles. Different for the sake of different is not going to cut it either. If healthcare is truly going to be reformed, we need to come up with both “different” and “better” – for the providers AND for the patients. So the question remains, does the highly publicized and government-endorsed accountable care organization meet these standards? Based on those attending the listening sessions this past week, I’m afraid the jury is still out.

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