Medicare

If you ran a summer camp that never reported the vast majority of times that you hurt one of your campers, you'd probably be shut down, arrested, or worse. The situation would be similar if a restaurant repeatedly made customers sick, or if a skydiving business habitually gave people the wrong parachutes.

Why, then, do hospitals only report about one in seven of the hundreds of thousands of medical errors, infections, and other adverse events that harm patients every year? And why can they get away with it?

That's a crucial question posed by Shannon Brownlee's most recent piece on TIME Ideas: An American Hospital: The Most Dangerous Place? Brownlee addresses the recent report from the US Department of Health and Human Services, which catalogued problems with the reporting system for medical errors and other patient harm. She argues that the reporting problems are only a piece of a larger quality and safety problem, and that hospitals need to move quickly to adopt checklists and other types of safety mechanisms:

"Some hospitals have made great strides in reducing errors and infections using — you guessed it — checklists. About 10 years ago, Dr. Peter Pronovost, an intensive-care specialist at Johns Hopkins Hospital in Baltimore, and a team of colleagues put together a series of checklists for some of the most common procedures performed in the intensive-care unit. For example, they created a list of steps for how to put in a central line — a tube for delivering medication directly into a vein in the patient’s chest — in a way that reduced the risk of infection. They made a checklist to prevent patients on a ventilator, or breathing machine, from contracting pneumonia. When Pronovost was given a grant to get every ICU in the state of Michigan to use just three of his checklists, the result was 1,500 lives saved and the state of Michigan saved $100 million."

You can read the full story here: http://ideas.time.com/2012/01/09/american-hospitals-the-most-dangerous-place/

Official Washington is now in the grip of an unprecedented bipartisan consensus. For all their other differences, leaders of both parties agree that Medicare, the nation’s primary means of providing health insurance for the elderly, is unsustainable and must be cut.

The folks downstairs at the Committee for a Responsible Federal Budget clued us in last week to an ongoing debate they've been having with the Center on Budget and Policy Priorities. The central piece of the debate is CRFB board member Erskine Bowles's recommendations to the Supercommittee, which included about $600 billion in reduced Medicare and Medicaid spending. The posts are interesting throughout, and as the deadline approaches, we felt it was important to check in on the federal budget side of health policy.

Here's the debate, with a our commentary:

The initial post: Bowles Plan Offers Path to Compromise

The most important aspect of Bowles' plan, from our perspective, is the method proposed by the Fiscal Commission for fixing the Sustainable Growth Rate (the ironically unsustainable Medicare reimbursement cuts that Congress pushes back each year). In order to pay for a long-term "doc fix" (which would bring down spending on physician fees by cutting rates of reimbursement), the commission recommended that Medicare "develop an improved physician payment formula that encourages care coordination across multiple providers and settings, and pays doctors based on quality instead of quantity of services."

This recommendation is critical. Moving away from the current fee-for-service system is among the most important ways to change how doctors make decisions; at a bare minimum, the Supercommittee should recommend changing reimbursements to reflect the value of primary care instead of encouraging the overcapacity of specialists we have right now.

CRFB didn't specifically mention it, but another critical Medicare fix that the Fiscal Commission recommended is removing the hospital exemption from IPAB recommendations. Given that hospitals make up a huge amount of our total medical spending and are the setting for a huge amount of unnecessary treatment, it's crucial that IPAB have the authority to recommend changes that improve hospitals' incentives to treat patients efficiently.

Related to the initial post: Actually, Raising the Medicare Age Is Also A Good Idea

CRFB's discussion of raising the Medicare age from 65 to 67 is the primary inspiration for this post's second title: we just can't find any good reason to support it.  (If you're really interested in why, we recommend The Incidental Economist's podcast on the subject.)

The thing is, we agree with CRFB on the facts surrounding the issue. Raising the Medicare age would decrease federal health spending somewhat. (The CBO numbers they mention are higher than the ones cited by Carroll and Frakt in the podcast, but not unreasonably so.) On the other hand, they also acknowledge that the shift would increase costs in the private market beyond the savings to the government (because Medicare pays lower reimbursement rates than private insurance). We at New Health Dialogue are concerned with the high total level of spending on health care, rather than simply the level of federal spending on health care. Unnecessarily increasing total medical spending therefore seems like a high cost to pay for a slight reduction in the federal budget which would probably be shortlived, since many of those 65-67 year olds would need help getting insurance, probably through the exchanges specificed in the ACA.

CBPP's initial response: Bowles “Compromise” Proposal to the Right of Boehner Offer to Obama in July

We have to point out a framing problem in CBPP's analysis: not all Medicare and Medicaid cuts are created equal. Some cuts (like those generated by raising the Medicare age) are simply shifting costs from the federal budget to beneficiaries. Those can be fairly labeled as "cuts," and they do increase the burden of health care spending on the elderly. Some of the $600 billion in lower Medicare/Medicaid spending, though, is intended to come from eliminating overtreatment and waste in the medical system. We're well aware that "eliminating waste, fraud, and abuse" is usually what politicians say they'll do to pay for things that they have no intention of actually paying for. However, the Dartmouth Atlas and other analyses have demonstrated that health care really does have a huge amount of wasteful care. Deciding to give patients only the medical care they need, rather than whatever local practice patterns dictate, deserves to be called what it is: responsible management of taxpayer dollars (and of the health system more generally). Demagoguing against such cuts because they reduce health entitlement spending ignores the possibility of making the health system work better, and stands in the way of real progress.

While the partisan gap in Washington is wider than it’s been at any time in living memory, the two parties do have one remarkable agenda in common. Both have proposed cuts in Medicare so drastic that they would have been politically suicidal a decade ago and may still be. Yet neither party is backing off.

Chairman Kohl, Senator Corker, Members of the Committee, thank you for inviting me here today to discuss changes for Medicare and the health care system. The fiscal challenges we face as a nation are immense, and the single largest cause in the long-term is growing health care costs, so this is a very important hearing and we thank you for holding it.

Health Wonk Review, Muppet Edition!

Hello all, and welcome to another exciting episode of Health Wonk Review! (Regular readers will note that yes, I used line last time. I have half a mind to make Alistair Cookie the official HWR mascot, here at New Health Dialogue.) In honor of what would have been Jim Henson’s 75^th birthday last week, I bring you the Muppet Edition of Health Wonk Review!

Now, without further silliness, the articles!

Quality Care

Here at New Health Dialogue, we’re exulting in doctors’ acceptance that yes, they do overtreat patients! Now, getting them to accept that money is part of the reason why…

Jonena Relth of Healthcare Talent Transformation draws attention to the cool new physician payment system being tried at Fairview clinics in Minnesota: payments are based on patient satisfaction and health, rather than by the number services provided.

David Williams draws a parallel between diagnosis and management consulting: experienced clinicians need to be wary of “early closure,” and avoid becoming like the “more experienced managers [who] are satisfied with two data points – after all, that’s enough to make a line, [or the partners who] just need one data point – they can assume the slope.”

Jessie Gruman, at the Prepared Patient Forum, wonders if the collaboration between HHS, the Robert Wood Johnson Foundation, Dr. Oz, and others will help Americans learn to pay attention to their medical care and improve communication with their providers.

Chris Langston points out that there are fewer people entering training for geriatric specialties—a workforce that may be critical in addressing the communications issue Jessie discussed.

Many aspects of health care reform require revolutionary thinking and groundbreaking research to move the system down unexplored pathways to new heights of efficiency and excellence.

...And some things don't. There are some solutions we see clearly right in front of our noses, with their implementation stymied by perpetual politicing. If you ever needed a clearer pictures of how our current Congressional process is ill suited to actually controlling the ever increasing costs of Medicare (and why IPAB, despite all the hemming and hawing on the Hill, is desperately needed), look no further than Sam Baker's report today in The Hill:

A bipartisan majority of House lawmakers is pressing Medicare to reverse a proposed cut to hospital payments.

The Medicare agency recently proposed a 3.5 percent cut in payments to hospitals as well as a 2.9 percent adjustment to offset payments that it said are the result of changes in how come claims are filed. But 219 House members said hospitals can't afford the cuts, and urged Medicare to reconsider the proposal.

"If the proposed rule is enacted, the net impact for hospitals would be an average decrease in inpatient payments," the lawmakers said in a letter to Medicare Administrator Don Berwick. "This is a decrease that hospitals can ill afford."

The letter says hospitals could lose more than $6 billion from the proposal. It was signed by 95 Republicans and 124 Democrats. A similar letter in the Senate garnered 45 signatures.

If we actually want the government to spend less on health care, we need to actually spend less on health care. And yes, this means somebody WILL make less money. Today's unacceptably high levels of Medicare spending will always be somebody else's acceptably high levels of Medicare income. It's the inability to contemplate short term "belt tightening" and shared sacrifice, at the expense of the long term sustainability of the health care system as a whole, that turns today's symptoms into the combined fiscal-healthcare crisis (and graph) everyone predicts.

The House of Representatives recently passed a bill linking an increase in the debt ceiling to a constitutional amendment limiting federal spending to 18 percent of GDP, coining it “Cut, Cap, and Balance.”  While the bill was rejected in the Senate, it is still interesting to think back to the last time federal spending fell below 18 percent of GDP.  America was entrenched in an increasingly intractable land war in Asia, Clint Eastwood’s icy stare dominated the silver screen, and everyone wanted a mop-top haircut just like the popular musician of the day.

The year was 1966.*

Our government – not to mention our economy as a whole – has changed markedly since the 1960s. The Center for American Progress has put together an interesting infographic highlighting some of the striking differences in health care between then and now.

1. Medicare was just a year old in 1966 and had a mere 19 million beneficiaries (9.7 percent of the total population), compared to more than 47.6 million today (15.5 percent).
2. Since then, estimated life expectancy has improved from 70 to 79, but at a cost: the average per person cost of health care was $1,541 in 1966 compared to over $8,000 today.
3. Average spending on prescription drugs per capita has increased 526 percent, from $132 to $826.

There are more of us, we’re living longer, and we’re spending those extra years buying more health care in a more expensive system.  The state of our country and government in 2011 just isn’t what it was in 1966.

In case you missed the excitement, the House Energy and Commerce Committee held its second day of hearings on the Independent Payments Advisory Board, also known as IPAB. The board has been a source of contention since its inception, as some members of Congress have insinuated that it would reduce seniors’ access to medical care. Be sure to follow our live-tweeting of the hearing here, join the conversation with the hashtags #IPAB, and you can watch the (remarkably interesting and entertaining) webcast here.

So what is IPAB, anyway? And more importantly, will it mean I get sent off on an ice floe to die when I turn 65?

Probably not. The Independent Payments Advisory Board was created by the Affordable Care Act as a mechanism for finding cost savings in Medicare, and keeping the per capita growth rate at the levels specified by Medicare's independent actuary. Its recommendations are submitted to Congress, and become law automatically through a "fast-tracked" parliamentary procedure unless Congress achieves the required cost savings by other means.

This post originally appeared as a guest opinion piece on Kaiser Health News on Tuesday, June 7th, 2011.

House Budget Committee Chairman Paul Ryan, R-Wis., probably did not anticipate the kind of trouble his plan for privatizing Medicare would cause members of his own party. Ever since Democrats scored an upset in a New York state special congressional election that turned on the Republican candidates support for the Ryan plan, GOP presidential hopefuls and lawmakers have been stumbling around the negative reaction the "Path to Prosperity" has drawn from many voters.

Americans have every reason to dislike Ryan's plan. Starting in 2022, it would give Medicare beneficiaries an $8,000 voucher -- the amount currently spent on the average recipient -- to go out and buy health insurance on the private market. Eight thousand dollars won't buy much health insurance in many markets, and seniors who can’t make up the difference would be left with little or no coverage.

However, there is one good thing about Ryan's plan, and it has been completely overlooked. Offering beneficiaries the same voucher, no matter where they live, would expose the egregious amount of money Medicare wastes in many parts of the country.

In Minneapolis, Medicare spent on average about $7,000 per beneficiary in 2007, the most recent Dartmouth Atlas figure available. That's on the low end. Medicare spent about the same amount in Sacramento, Calif., and Salt Lake City, and even less in Salem, Ore. At the high end, Medicare paid out nearly $16,000 per beneficiary in McAllen, Texas. Spending in Miami, Detroit and Boston wasn't far behind.