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Bryn Nelson is a former PhD microbiologist who decided he’d much rather write about microbes than mutate them. After seven years at the science desk of Newsday in New York, Nelson relocated to Seattle as a freelancer, where he has consumed far too much coffee and written features and stories for The Hospitalist, The New York Times, Nature, Scientific American, Science News for Students, Mosaic and many other print and online publications. In addition, he contributed a chapter to The Science Writers’ Handbook and edited two chapters for the six-volume Modernist Cuisine: The Art and Science of Cooking.
Medicare Cuts Could Hit HM Hard
The final 2010 Medicare physician fee schedule presents a mixed bag for hospitalists. As officials from the Centers for Medicare and Medicaid Services (CMS) warned, the update carries a hefty 21.2% fee schedule cut. Congressional action to avert that cut is expected, though wrangling over healthcare reform may force a stopgap measure to prevent the cuts from taking effect Jan. 1.
In a statement, Jonathan Blum, director of the CMS Center for Medicare Management, said the Obama administration is committed to repealing the sustainable growth rate formula that resulted in the substantial cut. In the meantime, he said, CMS is finalizing its proposal to drop physician-administered drugs from the definition of "physician services," which is used to formulate future fee updates. SHM has strongly supported both efforts and is calling on members to contact their legislators before a Nov. 16 vote.
Another huge change for hospitalists: The use of consultation codes has been discontinued, with the exception of codes related to telemedicine. In their place, healthcare providers must bill under initial hospital care, initial nursing facility care, or initial office visits. All transfers of care, for example, will now require billing under an initial visit code rather than a subsequent visit code. Consultation documentation requirements will no longer apply, though initial codes could be valued somewhat lower than similar consultation codes despite proposed adjustments to the relative value units (RVUs). Although bad for traditional consultations, some analysts see the net change as good for the comanagement of patients.
To help smooth the transition to this new coding system, SHM will be hosting a webinar, "Hot Topics in Evaluation and Management Coding," on Dec. 2.
The final 2010 Medicare physician fee schedule presents a mixed bag for hospitalists. As officials from the Centers for Medicare and Medicaid Services (CMS) warned, the update carries a hefty 21.2% fee schedule cut. Congressional action to avert that cut is expected, though wrangling over healthcare reform may force a stopgap measure to prevent the cuts from taking effect Jan. 1.
In a statement, Jonathan Blum, director of the CMS Center for Medicare Management, said the Obama administration is committed to repealing the sustainable growth rate formula that resulted in the substantial cut. In the meantime, he said, CMS is finalizing its proposal to drop physician-administered drugs from the definition of "physician services," which is used to formulate future fee updates. SHM has strongly supported both efforts and is calling on members to contact their legislators before a Nov. 16 vote.
Another huge change for hospitalists: The use of consultation codes has been discontinued, with the exception of codes related to telemedicine. In their place, healthcare providers must bill under initial hospital care, initial nursing facility care, or initial office visits. All transfers of care, for example, will now require billing under an initial visit code rather than a subsequent visit code. Consultation documentation requirements will no longer apply, though initial codes could be valued somewhat lower than similar consultation codes despite proposed adjustments to the relative value units (RVUs). Although bad for traditional consultations, some analysts see the net change as good for the comanagement of patients.
To help smooth the transition to this new coding system, SHM will be hosting a webinar, "Hot Topics in Evaluation and Management Coding," on Dec. 2.
The final 2010 Medicare physician fee schedule presents a mixed bag for hospitalists. As officials from the Centers for Medicare and Medicaid Services (CMS) warned, the update carries a hefty 21.2% fee schedule cut. Congressional action to avert that cut is expected, though wrangling over healthcare reform may force a stopgap measure to prevent the cuts from taking effect Jan. 1.
In a statement, Jonathan Blum, director of the CMS Center for Medicare Management, said the Obama administration is committed to repealing the sustainable growth rate formula that resulted in the substantial cut. In the meantime, he said, CMS is finalizing its proposal to drop physician-administered drugs from the definition of "physician services," which is used to formulate future fee updates. SHM has strongly supported both efforts and is calling on members to contact their legislators before a Nov. 16 vote.
Another huge change for hospitalists: The use of consultation codes has been discontinued, with the exception of codes related to telemedicine. In their place, healthcare providers must bill under initial hospital care, initial nursing facility care, or initial office visits. All transfers of care, for example, will now require billing under an initial visit code rather than a subsequent visit code. Consultation documentation requirements will no longer apply, though initial codes could be valued somewhat lower than similar consultation codes despite proposed adjustments to the relative value units (RVUs). Although bad for traditional consultations, some analysts see the net change as good for the comanagement of patients.
To help smooth the transition to this new coding system, SHM will be hosting a webinar, "Hot Topics in Evaluation and Management Coding," on Dec. 2.
Healthcare Reform
The struggle over U.S. healthcare reform has consumed Congress for most of the year. It has dominated media coverage and fueled informal debates in all parts of the country. A resolution to the heated back-and-forth should arrive by Thanksgiving in the form of meaningful healthcare legislation, according to Vice President Joe Biden. Then again, Sen. Jim DeMint (R-S.C.) has pledged to cancel the Democrats’ planned festivities, preventing what he and other opponents have described as a “government takeover” of the healthcare system.
Amid the emotional tug-of-war and evolving bills, the nonpartisan Congressional Budget Office (CBO) has laid out the stakes. In a June letter to the Senate Budget Committee, CBO Director Douglas W. Elmendorf begins: “In the absence of significant changes in policy, rising costs for healthcare will cause federal spending to grow much faster than the economy, putting the federal budget on an unsustainable path.”
Most experts, analysts, and politicians agree that something must be done. It’s all a matter of what and how much it will cost. In the spirit of Thanksgiving, let’s talk turkey about the healthcare reform proposals that may or may not survive the holiday, and the key players who will determine whether this year’s reform effort stays alive—or gets stuffed.
Main Points of Disagreement
Beyond the sticky matter of how to pay for everything, businesses instinctively have opposed any requirement that employers offer health insurance to their employees. Then again, that opposition seems to be softening as more details of the plan are released.
In principle, widespread agreement exists on the notion that individuals should have guaranteed issue and renewability of their healthcare insurance, regardless of pre-existing conditions. Far less clear, however, is the matter of how much those individuals will have to pay for their policies.
Main Points of Agreement
Not everyone is on board, but any healthcare reform bill that emerges from Congress is likely to contain three main elements, according to Leighton Ku, director of the Center for Health Policy Research at George Washington University in Washington, D.C.
1. Expansion of Medicaid
2. Health Insurance Exchanges
Think of exchanges as the Travelocity or Orbitz for health-insurance plans, complete with coupons for the needy. Sliding-scale tax credits or vouchers could be used by low- to moderate-income people to buy insurance in publicly available, government-regulated marketplaces where such parameters as premiums and coverage could be compared. “The concept is that by setting up standards and having a place where it’s all together, it would create a competition,” Ku says.
In essence, more competition could lead to cost reductions.
3. An Individual Mandate
Hardship exemptions are likely, but people who can afford it will be expected to buy insurance or pay a penalty. Republican rumblings suggest that agreement on this point may not be as widespread as initially thought.
Main Players
President Obama has made healthcare reform the centerpiece of his first-year agenda. If he is to succeed, organizations like AARP will be key in winning over skeptical seniors. But the real power lies with a handful of Congressional leaders who have the ability to make or break any legislation. A brief rundown:
Senate
The overhaul is less expensive and more moderate than the America’s Affordable Health Choices Act, introduced in the House of Representatives, and a partial bill passed earlier by Sen. Kennedy’s Health, Education, Labor and Pensions (HELP) Committee. Nevertheless, progressives and conservatives criticized the Baucus plan. Even so, Sen. Olympia Snowe (R-Maine) has become a major focus of Democrats’ efforts to find 60 votes and avoid a Republican filibuster, though the seating of a replacement for Sen. Kennedy would help Democrats regain a filibuster-proof majority. One key point: Analysts say bringing Sen. Snowe on board might not win other Republican votes, but she might offer cover for such conservative Democratic senators as Mary Landrieu (D-La.) and Ben Nelson (D-Neb.).
As a last resort, Democrats have raised the possibility of using reconciliation, an arcane process originally intended for budgetary items. Reconciliation requires only a 51-vote majority, but complicated rules and a promised Republican challenge could lead to chaos.
House
Paying For It All
Meaningful reform without breaking the bank is a common refrain in healthcare discussions. Despite heated disputes over taxes, fees, fines, and service cuts to help defray costs, two main mechanisms for savings have emerged, according to the Center for Health Policy Research’s Ku:
1. Curbing Medicare Advantage
One cost-cutting idea would be to restore a level playing field, Ku says, and pay managed care on par with Medicare and Medicaid. “This is one of the largest components of savings that people are anticipating,” he adds. A backlash by seniors, however, has led to a “grandfathering” clause that would protect the extra benefits in certain parts of the country, potentially reducing the overall savings.
2. Disproportionate Share Hospital (DSH) Cuts
Both Medicare and Medicaid pay extra to hospitals that serve a high proportion of needy patients. The savings mechanism here is less clear, but the expectation is that because the number of uninsured patients will drop dramatically with legislation, the DSH payments could be scaled back as well. The cuts, phased in over a decade, could amount to tens of billions of dollars in overall savings, though the House and Senate Finance bills differ in how deep the trims should be.
For More Information
- Kaiser Family Foundation
http://healthreform.kff.org
The foundation’s comprehensive “Health Reform” page offers a side-by-side comparison of 12 healthcare proposals, including both Democratic and Republican bills.
- Congressional Budget Office
The nonpartisan office has already weighed in on the economic effects of preliminary versions of the competing healthcare reform bills, and will likely do so again.
- FactCheck.org
A project of The University of Pennsylvania’s Annenberg Public Policy Center, the site has debunked dozens of healthcare reform myths.
- PolitiFact.com
The Truth-O-Meter, a project of the St. Petersburg Times, has put recent healthcare assertions into categories ranging from “True” (substantiated assertions) to “Pants on Fire” (for absurd untruths).
- HospitalMedicine.org/advocacy
SHM updates health reform progress and offers a monthly “Washington Update” outlining the society’s policy positions and activities.
Other Proposals to Keep an Eye On
- Addition of a hospital value-based purchasing (VBP) program to Medicare, which would tie incentive payments to performance on various quality measures;
- Expansion of the Physician’s Quality Reporting Initiative (PQRI), with a 1% payment penalty by 2012 for nonparticipants;
- Creation of a CMS payment innovation center to try out new payment structures, with the goal of improving quality and reducing Medicare costs; and
- Establishment of a Medicare pilot initiative called the Community Care Transitions Program, which would spend $500 million over 10 years on efforts to reduce preventable rehospitalizations; SHM’s Project BOOST (Better Outcomes for Older Adults through Safe Transitions) likely would qualify.
Four Proposals Hospitalists Should Know About
1. Fixes to Medicare’s Physician Fee Schedule
The House bill would provide $228.5 billion to repeal the sustainable growth rate (SGR) used to determine the annual physician fee schedule and eliminate accumulated SGR debt, preventing a potential 21.5% cut in 2010 reimbursement fees. The more cost-conscious Senate Finance bill, by contrast, provides a one-year patch, providing a 0.5% update instead of any cut, but it leaves the SGR in place. “We understand the budgetary constraints that Senator Baucus is working with, but we’re disappointed that the SGR is getting another patch,” says Eric Siegal, MD, FHM, chair of SHM’s Public Policy Committee. “If we’re going to talk about restructuring healthcare, then we also need a payment system that is stable and that is not subject to the yearly whims of Congress.”
2. Medical Liability Reform
The Senate Finance plan’s nonbinding “Sense of the Senate,” which encourages states to pursue alternatives to the current civil litigation system, is a “missed opportunity,” according to Dr. Siegal. “We think that the Senate Finance Committee should have gone further with this,” he says, noting that medical liability is a significant driver of unnecessary healthcare expenses. The House bill is more robust in pushing medical malpractice reform by offering states federal assistance, Dr. Siegal says, but still leaves room for improvement.
3. Primary-Care Bonus Payments
Conceptually, the Senate and the House bills offer similar proposals to improve reimbursements for primary care, something Dr. Siegal says SHM has consistently and strongly supported “as a way of preventing further erosion of the primary-care infrastructure.” Depending on how the Senate Finance plan defines “primary care,” hospitalists might benefit directly. “Even if you get past the issue of whether it hits our pocketbook favorably,” Dr. Siegal says, “it is in the strategic interest of our specialty to have a strong primary-care base.”
4. Bundled Payments
Proposals in both the Senate and House bills for a pilot program aimed at bundling payments around an episode of care have been greeted cautiously by hospitalists, as have other new payment proposals. Robust and meaningful demonstration projects, Dr. Siegal says, are necessary to get a better sense of what the consequences could be, intended or otherwise. “Any time you’re talking about changes to the fundamental architecture of how we pay people for what they do, you’d better spend some time looking into what the implications of that are,” he says. TH
Bryn Nelson is a freelance writer based in Seattle.
Image Sources: KASH76, DIADEMIMAGES, DAVID GUNN, TOMENG, ALEXEY KASHIN, JONATHAN LARSEN, JON HELGASON, STEFAN KLEIN, SX70, SDOMINICK/ISTOCKPHOTO.COM
The struggle over U.S. healthcare reform has consumed Congress for most of the year. It has dominated media coverage and fueled informal debates in all parts of the country. A resolution to the heated back-and-forth should arrive by Thanksgiving in the form of meaningful healthcare legislation, according to Vice President Joe Biden. Then again, Sen. Jim DeMint (R-S.C.) has pledged to cancel the Democrats’ planned festivities, preventing what he and other opponents have described as a “government takeover” of the healthcare system.
Amid the emotional tug-of-war and evolving bills, the nonpartisan Congressional Budget Office (CBO) has laid out the stakes. In a June letter to the Senate Budget Committee, CBO Director Douglas W. Elmendorf begins: “In the absence of significant changes in policy, rising costs for healthcare will cause federal spending to grow much faster than the economy, putting the federal budget on an unsustainable path.”
Most experts, analysts, and politicians agree that something must be done. It’s all a matter of what and how much it will cost. In the spirit of Thanksgiving, let’s talk turkey about the healthcare reform proposals that may or may not survive the holiday, and the key players who will determine whether this year’s reform effort stays alive—or gets stuffed.
Main Points of Disagreement
Beyond the sticky matter of how to pay for everything, businesses instinctively have opposed any requirement that employers offer health insurance to their employees. Then again, that opposition seems to be softening as more details of the plan are released.
In principle, widespread agreement exists on the notion that individuals should have guaranteed issue and renewability of their healthcare insurance, regardless of pre-existing conditions. Far less clear, however, is the matter of how much those individuals will have to pay for their policies.
Main Points of Agreement
Not everyone is on board, but any healthcare reform bill that emerges from Congress is likely to contain three main elements, according to Leighton Ku, director of the Center for Health Policy Research at George Washington University in Washington, D.C.
1. Expansion of Medicaid
2. Health Insurance Exchanges
Think of exchanges as the Travelocity or Orbitz for health-insurance plans, complete with coupons for the needy. Sliding-scale tax credits or vouchers could be used by low- to moderate-income people to buy insurance in publicly available, government-regulated marketplaces where such parameters as premiums and coverage could be compared. “The concept is that by setting up standards and having a place where it’s all together, it would create a competition,” Ku says.
In essence, more competition could lead to cost reductions.
3. An Individual Mandate
Hardship exemptions are likely, but people who can afford it will be expected to buy insurance or pay a penalty. Republican rumblings suggest that agreement on this point may not be as widespread as initially thought.
Main Players
President Obama has made healthcare reform the centerpiece of his first-year agenda. If he is to succeed, organizations like AARP will be key in winning over skeptical seniors. But the real power lies with a handful of Congressional leaders who have the ability to make or break any legislation. A brief rundown:
Senate
The overhaul is less expensive and more moderate than the America’s Affordable Health Choices Act, introduced in the House of Representatives, and a partial bill passed earlier by Sen. Kennedy’s Health, Education, Labor and Pensions (HELP) Committee. Nevertheless, progressives and conservatives criticized the Baucus plan. Even so, Sen. Olympia Snowe (R-Maine) has become a major focus of Democrats’ efforts to find 60 votes and avoid a Republican filibuster, though the seating of a replacement for Sen. Kennedy would help Democrats regain a filibuster-proof majority. One key point: Analysts say bringing Sen. Snowe on board might not win other Republican votes, but she might offer cover for such conservative Democratic senators as Mary Landrieu (D-La.) and Ben Nelson (D-Neb.).
As a last resort, Democrats have raised the possibility of using reconciliation, an arcane process originally intended for budgetary items. Reconciliation requires only a 51-vote majority, but complicated rules and a promised Republican challenge could lead to chaos.
House
Paying For It All
Meaningful reform without breaking the bank is a common refrain in healthcare discussions. Despite heated disputes over taxes, fees, fines, and service cuts to help defray costs, two main mechanisms for savings have emerged, according to the Center for Health Policy Research’s Ku:
1. Curbing Medicare Advantage
One cost-cutting idea would be to restore a level playing field, Ku says, and pay managed care on par with Medicare and Medicaid. “This is one of the largest components of savings that people are anticipating,” he adds. A backlash by seniors, however, has led to a “grandfathering” clause that would protect the extra benefits in certain parts of the country, potentially reducing the overall savings.
2. Disproportionate Share Hospital (DSH) Cuts
Both Medicare and Medicaid pay extra to hospitals that serve a high proportion of needy patients. The savings mechanism here is less clear, but the expectation is that because the number of uninsured patients will drop dramatically with legislation, the DSH payments could be scaled back as well. The cuts, phased in over a decade, could amount to tens of billions of dollars in overall savings, though the House and Senate Finance bills differ in how deep the trims should be.
For More Information
- Kaiser Family Foundation
http://healthreform.kff.org
The foundation’s comprehensive “Health Reform” page offers a side-by-side comparison of 12 healthcare proposals, including both Democratic and Republican bills.
- Congressional Budget Office
The nonpartisan office has already weighed in on the economic effects of preliminary versions of the competing healthcare reform bills, and will likely do so again.
- FactCheck.org
A project of The University of Pennsylvania’s Annenberg Public Policy Center, the site has debunked dozens of healthcare reform myths.
- PolitiFact.com
The Truth-O-Meter, a project of the St. Petersburg Times, has put recent healthcare assertions into categories ranging from “True” (substantiated assertions) to “Pants on Fire” (for absurd untruths).
- HospitalMedicine.org/advocacy
SHM updates health reform progress and offers a monthly “Washington Update” outlining the society’s policy positions and activities.
Other Proposals to Keep an Eye On
- Addition of a hospital value-based purchasing (VBP) program to Medicare, which would tie incentive payments to performance on various quality measures;
- Expansion of the Physician’s Quality Reporting Initiative (PQRI), with a 1% payment penalty by 2012 for nonparticipants;
- Creation of a CMS payment innovation center to try out new payment structures, with the goal of improving quality and reducing Medicare costs; and
- Establishment of a Medicare pilot initiative called the Community Care Transitions Program, which would spend $500 million over 10 years on efforts to reduce preventable rehospitalizations; SHM’s Project BOOST (Better Outcomes for Older Adults through Safe Transitions) likely would qualify.
Four Proposals Hospitalists Should Know About
1. Fixes to Medicare’s Physician Fee Schedule
The House bill would provide $228.5 billion to repeal the sustainable growth rate (SGR) used to determine the annual physician fee schedule and eliminate accumulated SGR debt, preventing a potential 21.5% cut in 2010 reimbursement fees. The more cost-conscious Senate Finance bill, by contrast, provides a one-year patch, providing a 0.5% update instead of any cut, but it leaves the SGR in place. “We understand the budgetary constraints that Senator Baucus is working with, but we’re disappointed that the SGR is getting another patch,” says Eric Siegal, MD, FHM, chair of SHM’s Public Policy Committee. “If we’re going to talk about restructuring healthcare, then we also need a payment system that is stable and that is not subject to the yearly whims of Congress.”
2. Medical Liability Reform
The Senate Finance plan’s nonbinding “Sense of the Senate,” which encourages states to pursue alternatives to the current civil litigation system, is a “missed opportunity,” according to Dr. Siegal. “We think that the Senate Finance Committee should have gone further with this,” he says, noting that medical liability is a significant driver of unnecessary healthcare expenses. The House bill is more robust in pushing medical malpractice reform by offering states federal assistance, Dr. Siegal says, but still leaves room for improvement.
3. Primary-Care Bonus Payments
Conceptually, the Senate and the House bills offer similar proposals to improve reimbursements for primary care, something Dr. Siegal says SHM has consistently and strongly supported “as a way of preventing further erosion of the primary-care infrastructure.” Depending on how the Senate Finance plan defines “primary care,” hospitalists might benefit directly. “Even if you get past the issue of whether it hits our pocketbook favorably,” Dr. Siegal says, “it is in the strategic interest of our specialty to have a strong primary-care base.”
4. Bundled Payments
Proposals in both the Senate and House bills for a pilot program aimed at bundling payments around an episode of care have been greeted cautiously by hospitalists, as have other new payment proposals. Robust and meaningful demonstration projects, Dr. Siegal says, are necessary to get a better sense of what the consequences could be, intended or otherwise. “Any time you’re talking about changes to the fundamental architecture of how we pay people for what they do, you’d better spend some time looking into what the implications of that are,” he says. TH
Bryn Nelson is a freelance writer based in Seattle.
Image Sources: KASH76, DIADEMIMAGES, DAVID GUNN, TOMENG, ALEXEY KASHIN, JONATHAN LARSEN, JON HELGASON, STEFAN KLEIN, SX70, SDOMINICK/ISTOCKPHOTO.COM
The struggle over U.S. healthcare reform has consumed Congress for most of the year. It has dominated media coverage and fueled informal debates in all parts of the country. A resolution to the heated back-and-forth should arrive by Thanksgiving in the form of meaningful healthcare legislation, according to Vice President Joe Biden. Then again, Sen. Jim DeMint (R-S.C.) has pledged to cancel the Democrats’ planned festivities, preventing what he and other opponents have described as a “government takeover” of the healthcare system.
Amid the emotional tug-of-war and evolving bills, the nonpartisan Congressional Budget Office (CBO) has laid out the stakes. In a June letter to the Senate Budget Committee, CBO Director Douglas W. Elmendorf begins: “In the absence of significant changes in policy, rising costs for healthcare will cause federal spending to grow much faster than the economy, putting the federal budget on an unsustainable path.”
Most experts, analysts, and politicians agree that something must be done. It’s all a matter of what and how much it will cost. In the spirit of Thanksgiving, let’s talk turkey about the healthcare reform proposals that may or may not survive the holiday, and the key players who will determine whether this year’s reform effort stays alive—or gets stuffed.
Main Points of Disagreement
Beyond the sticky matter of how to pay for everything, businesses instinctively have opposed any requirement that employers offer health insurance to their employees. Then again, that opposition seems to be softening as more details of the plan are released.
In principle, widespread agreement exists on the notion that individuals should have guaranteed issue and renewability of their healthcare insurance, regardless of pre-existing conditions. Far less clear, however, is the matter of how much those individuals will have to pay for their policies.
Main Points of Agreement
Not everyone is on board, but any healthcare reform bill that emerges from Congress is likely to contain three main elements, according to Leighton Ku, director of the Center for Health Policy Research at George Washington University in Washington, D.C.
1. Expansion of Medicaid
2. Health Insurance Exchanges
Think of exchanges as the Travelocity or Orbitz for health-insurance plans, complete with coupons for the needy. Sliding-scale tax credits or vouchers could be used by low- to moderate-income people to buy insurance in publicly available, government-regulated marketplaces where such parameters as premiums and coverage could be compared. “The concept is that by setting up standards and having a place where it’s all together, it would create a competition,” Ku says.
In essence, more competition could lead to cost reductions.
3. An Individual Mandate
Hardship exemptions are likely, but people who can afford it will be expected to buy insurance or pay a penalty. Republican rumblings suggest that agreement on this point may not be as widespread as initially thought.
Main Players
President Obama has made healthcare reform the centerpiece of his first-year agenda. If he is to succeed, organizations like AARP will be key in winning over skeptical seniors. But the real power lies with a handful of Congressional leaders who have the ability to make or break any legislation. A brief rundown:
Senate
The overhaul is less expensive and more moderate than the America’s Affordable Health Choices Act, introduced in the House of Representatives, and a partial bill passed earlier by Sen. Kennedy’s Health, Education, Labor and Pensions (HELP) Committee. Nevertheless, progressives and conservatives criticized the Baucus plan. Even so, Sen. Olympia Snowe (R-Maine) has become a major focus of Democrats’ efforts to find 60 votes and avoid a Republican filibuster, though the seating of a replacement for Sen. Kennedy would help Democrats regain a filibuster-proof majority. One key point: Analysts say bringing Sen. Snowe on board might not win other Republican votes, but she might offer cover for such conservative Democratic senators as Mary Landrieu (D-La.) and Ben Nelson (D-Neb.).
As a last resort, Democrats have raised the possibility of using reconciliation, an arcane process originally intended for budgetary items. Reconciliation requires only a 51-vote majority, but complicated rules and a promised Republican challenge could lead to chaos.
House
Paying For It All
Meaningful reform without breaking the bank is a common refrain in healthcare discussions. Despite heated disputes over taxes, fees, fines, and service cuts to help defray costs, two main mechanisms for savings have emerged, according to the Center for Health Policy Research’s Ku:
1. Curbing Medicare Advantage
One cost-cutting idea would be to restore a level playing field, Ku says, and pay managed care on par with Medicare and Medicaid. “This is one of the largest components of savings that people are anticipating,” he adds. A backlash by seniors, however, has led to a “grandfathering” clause that would protect the extra benefits in certain parts of the country, potentially reducing the overall savings.
2. Disproportionate Share Hospital (DSH) Cuts
Both Medicare and Medicaid pay extra to hospitals that serve a high proportion of needy patients. The savings mechanism here is less clear, but the expectation is that because the number of uninsured patients will drop dramatically with legislation, the DSH payments could be scaled back as well. The cuts, phased in over a decade, could amount to tens of billions of dollars in overall savings, though the House and Senate Finance bills differ in how deep the trims should be.
For More Information
- Kaiser Family Foundation
http://healthreform.kff.org
The foundation’s comprehensive “Health Reform” page offers a side-by-side comparison of 12 healthcare proposals, including both Democratic and Republican bills.
- Congressional Budget Office
The nonpartisan office has already weighed in on the economic effects of preliminary versions of the competing healthcare reform bills, and will likely do so again.
- FactCheck.org
A project of The University of Pennsylvania’s Annenberg Public Policy Center, the site has debunked dozens of healthcare reform myths.
- PolitiFact.com
The Truth-O-Meter, a project of the St. Petersburg Times, has put recent healthcare assertions into categories ranging from “True” (substantiated assertions) to “Pants on Fire” (for absurd untruths).
- HospitalMedicine.org/advocacy
SHM updates health reform progress and offers a monthly “Washington Update” outlining the society’s policy positions and activities.
Other Proposals to Keep an Eye On
- Addition of a hospital value-based purchasing (VBP) program to Medicare, which would tie incentive payments to performance on various quality measures;
- Expansion of the Physician’s Quality Reporting Initiative (PQRI), with a 1% payment penalty by 2012 for nonparticipants;
- Creation of a CMS payment innovation center to try out new payment structures, with the goal of improving quality and reducing Medicare costs; and
- Establishment of a Medicare pilot initiative called the Community Care Transitions Program, which would spend $500 million over 10 years on efforts to reduce preventable rehospitalizations; SHM’s Project BOOST (Better Outcomes for Older Adults through Safe Transitions) likely would qualify.
Four Proposals Hospitalists Should Know About
1. Fixes to Medicare’s Physician Fee Schedule
The House bill would provide $228.5 billion to repeal the sustainable growth rate (SGR) used to determine the annual physician fee schedule and eliminate accumulated SGR debt, preventing a potential 21.5% cut in 2010 reimbursement fees. The more cost-conscious Senate Finance bill, by contrast, provides a one-year patch, providing a 0.5% update instead of any cut, but it leaves the SGR in place. “We understand the budgetary constraints that Senator Baucus is working with, but we’re disappointed that the SGR is getting another patch,” says Eric Siegal, MD, FHM, chair of SHM’s Public Policy Committee. “If we’re going to talk about restructuring healthcare, then we also need a payment system that is stable and that is not subject to the yearly whims of Congress.”
2. Medical Liability Reform
The Senate Finance plan’s nonbinding “Sense of the Senate,” which encourages states to pursue alternatives to the current civil litigation system, is a “missed opportunity,” according to Dr. Siegal. “We think that the Senate Finance Committee should have gone further with this,” he says, noting that medical liability is a significant driver of unnecessary healthcare expenses. The House bill is more robust in pushing medical malpractice reform by offering states federal assistance, Dr. Siegal says, but still leaves room for improvement.
3. Primary-Care Bonus Payments
Conceptually, the Senate and the House bills offer similar proposals to improve reimbursements for primary care, something Dr. Siegal says SHM has consistently and strongly supported “as a way of preventing further erosion of the primary-care infrastructure.” Depending on how the Senate Finance plan defines “primary care,” hospitalists might benefit directly. “Even if you get past the issue of whether it hits our pocketbook favorably,” Dr. Siegal says, “it is in the strategic interest of our specialty to have a strong primary-care base.”
4. Bundled Payments
Proposals in both the Senate and House bills for a pilot program aimed at bundling payments around an episode of care have been greeted cautiously by hospitalists, as have other new payment proposals. Robust and meaningful demonstration projects, Dr. Siegal says, are necessary to get a better sense of what the consequences could be, intended or otherwise. “Any time you’re talking about changes to the fundamental architecture of how we pay people for what they do, you’d better spend some time looking into what the implications of that are,” he says. TH
Bryn Nelson is a freelance writer based in Seattle.
Image Sources: KASH76, DIADEMIMAGES, DAVID GUNN, TOMENG, ALEXEY KASHIN, JONATHAN LARSEN, JON HELGASON, STEFAN KLEIN, SX70, SDOMINICK/ISTOCKPHOTO.COM
Payment Purgatory
It happens every year: A new Medicare physician fee schedule recommends a painful reduction in the rates the government doles out for more than 7,000 types of medical services performed by hospitalists, primary-care doctors, and other healthcare providers. And then Congress intervenes to keep the reduction from going into effect.
This year, however, the fee updates and policy proposals have become intertwined in the larger debate over comprehensive healthcare reform and a push toward what SHM calls a “value-based health delivery system.”
Few think the whopping 21.5% reduction proposed for 2010 rates, which are due to be published Nov. 1, actually will go into effect in January. A combination of other proposed changes to the fee schedule could soften any reduction. But the larger issue of how fees are currently calculated has become a rallying point for SHM and other healthcare-reform advocates who’d like to see the entire formula scrapped in favor of a more equitable distribution that focuses on outcomes. SHM has expressed concern that the current fee-for-service payment system “fails to provide providers with incentives to improve efficiency or quality of care, and encourages overutilization of services.”
—J. James Rohack, MD, AMA president
The current fee formula, known as the sustainable growth rate (SGR) and stipulated by the Balanced Budget Act of 1997, has resulted in a proposed rate cut every year since it went into effect in 2002. Congress consistently overrides the reimbursement cuts in one way or another, usually enacting modest increases or, such as in 2006 and 2007, an across-the-board freeze.
Hospitalists and other physicians have greeted another high-profile proposal with more enthusiasm: the removal of physician-administered drugs from the definition of “physician services,” thereby eliminating a high-cost item from the SGR formula. A Centers for Medicare and Medicaid Services (CMS) spokeswoman says the agency previously felt it lacked the authority to propose the removal. But a review earlier this year reversed that position, leading to the change. The removal, she says, “wouldn’t change the 21.5% percent decline in 2010, but it could have an impact in future years.”
American Medical Association President J. James Rohack, MD, joined the chorus of approval with a statement that asserted, “The removal of physician-administered drugs from the broken Medicare physician payment formula is a major victory for America’s seniors and their physicians.”
Consultation Change
A separate physician fee schedule proposal would eliminate payments for consultation codes in both outpatient and inpatient settings in favor of codes for evaluation and management services that carry lower reimbursement rates. Doctors would have a new way to bill for tele-health consultations, however. Leslie Flores, director of SHM’s Practice Management Institute, said the proposal has generated a high level of misinformation and misunderstanding among hospitalists who fear CMS will no longer reimburse for inpatient consultations. “It’s not that they won’t allow the work to be done anymore,” Flores says. “They’re just instructing people to bill in a different way for that work.”
CMS notes that the savings would be redistributed to increase payments for existing evaluation and management services codes, making the change cost-neutral. But Flores says a lack of details about the “crosswalk” from the old codes to the new codes, especially as they relate to transfers of care, is fueling hospitalists’ confusion over the true impact on their reimbursements.
“Our biggest concern with this consultation proposal that is now on the table is that CMS has not done anything to clarify how these transfers of care would be treated,” she says. For example, would hospitalists bill an admission code the first time they see a patient after being asked by a surgeon to take over that patient’s diabetes care? If so, “this proposal could actually result in some pretty good revenue increases for a lot of hospitalist practices that are doing a lot of surgical comanagement,” she says.
If hospitalists are instead required to bill a work-intensive transition of care under the code for a subsequent visit, which CMS has enforced since a 2006 rule clarification, Flores explains, HM could lose anywhere from 1% to 18% of reimbursements, depending on the exact code used.
Quality Reporting
The proposed fee schedule also is generating disappointment about what will not be included in Medicare’s Physician Quality Reporting Initiative (PQRI) for 2010. The pay-for-performance PQRI, which rewards physicians for reporting on quality measures by paying them an additional 2% of their estimated charges for covered services, will streamline some reporting requirements and increase the overall number of reportable measures. But several care-transition measures sought by SHM were not endorsed in time and will not be among them. Those measures include:
- Reconciled medication lists received by discharged patients;
- Transition records with specified elements received by discharged patients (including one measure for an inpatient discharge to home or self-care, and another for an ED discharge to home, ambulatory, or self-care); and
- Timely transmission of transition records.
“It was really a question of timing,” says Jill Epstein, senior advisor of SHM’s Performance and Standards Committee. The National Quality Forum, the nonprofit organization charged with signing off on all new measures, was not able to fully vet the recommended additions by the July 1 deadline, Epstein says, postponing their inclusion. “Our hope is that the measures will be included for 2011, of course.”
Separately, the PQRI proposal seeks to add an electronic-health-record-based mechanism to the list of eligible reporting methods. Although that addition is welcome news, Epstein says, SHM is expressing its concern about the shift toward patient-registry-based reporting, including a proposal to lessen or perhaps even discontinue claims-based reporting after 2010. “The issue for hospitalists, as well as for any specialty,” she says, “is that not every group will have access to a qualified PQRI registry as early as 2011,” particularly rural-based groups with fewer resources.
A similar change would streamline the E-Prescribing Incentive Program’s rules for how often e-prescribing codes must be reported. It also will offer more choices for how to report them, including through qualified registries. In the past, the program had little direct impact on hospitalists, but the new proposal recommends adding reporting codes specific to nursing homes, where some hospitalists provide care and could benefit from the incentives.
Paul Fishman, an economist at the Group Health Center for Health Studies in Seattle, says the increased focus on incentives in Medicare’s fee schedule suggests a growing realization of how such incentives can drive the delivery of healthcare services. “We know with absolute certainty that physicians make choices based on how things are reimbursed,” he says. Developing good outcome measures, then, will be critical for establishing pay-for-performance standards as part of a fee package that he says should include a blend of capitation and service-based and outcome-based reimbursements to strike a fairer balance.
“In healthcare, we’ve incented people to do more and more stuff, whether they improve outcomes or not, but we have to figure out a way to incent improvements in outcomes, while still retaining the long-term incentive to keep people healthy,” Fishman says. If better transitions of care result in a healthier population that is rehospitalized less often, for example, how can outcome-based incentives prevent hospitals from losing money in the long run? “We want to create the incentives to make the improvements in health outcomes, but we don’t want to punish the better actors because they are consistently lowering costs and also lowering reimbursement levels,” he says.
Achieving that balance in both Medicare and the broader healthcare system, he and other observers agree, is still very much a work in progress. TH
Bryn Nelson is a freelance writer based in Seattle.
It happens every year: A new Medicare physician fee schedule recommends a painful reduction in the rates the government doles out for more than 7,000 types of medical services performed by hospitalists, primary-care doctors, and other healthcare providers. And then Congress intervenes to keep the reduction from going into effect.
This year, however, the fee updates and policy proposals have become intertwined in the larger debate over comprehensive healthcare reform and a push toward what SHM calls a “value-based health delivery system.”
Few think the whopping 21.5% reduction proposed for 2010 rates, which are due to be published Nov. 1, actually will go into effect in January. A combination of other proposed changes to the fee schedule could soften any reduction. But the larger issue of how fees are currently calculated has become a rallying point for SHM and other healthcare-reform advocates who’d like to see the entire formula scrapped in favor of a more equitable distribution that focuses on outcomes. SHM has expressed concern that the current fee-for-service payment system “fails to provide providers with incentives to improve efficiency or quality of care, and encourages overutilization of services.”
—J. James Rohack, MD, AMA president
The current fee formula, known as the sustainable growth rate (SGR) and stipulated by the Balanced Budget Act of 1997, has resulted in a proposed rate cut every year since it went into effect in 2002. Congress consistently overrides the reimbursement cuts in one way or another, usually enacting modest increases or, such as in 2006 and 2007, an across-the-board freeze.
Hospitalists and other physicians have greeted another high-profile proposal with more enthusiasm: the removal of physician-administered drugs from the definition of “physician services,” thereby eliminating a high-cost item from the SGR formula. A Centers for Medicare and Medicaid Services (CMS) spokeswoman says the agency previously felt it lacked the authority to propose the removal. But a review earlier this year reversed that position, leading to the change. The removal, she says, “wouldn’t change the 21.5% percent decline in 2010, but it could have an impact in future years.”
American Medical Association President J. James Rohack, MD, joined the chorus of approval with a statement that asserted, “The removal of physician-administered drugs from the broken Medicare physician payment formula is a major victory for America’s seniors and their physicians.”
Consultation Change
A separate physician fee schedule proposal would eliminate payments for consultation codes in both outpatient and inpatient settings in favor of codes for evaluation and management services that carry lower reimbursement rates. Doctors would have a new way to bill for tele-health consultations, however. Leslie Flores, director of SHM’s Practice Management Institute, said the proposal has generated a high level of misinformation and misunderstanding among hospitalists who fear CMS will no longer reimburse for inpatient consultations. “It’s not that they won’t allow the work to be done anymore,” Flores says. “They’re just instructing people to bill in a different way for that work.”
CMS notes that the savings would be redistributed to increase payments for existing evaluation and management services codes, making the change cost-neutral. But Flores says a lack of details about the “crosswalk” from the old codes to the new codes, especially as they relate to transfers of care, is fueling hospitalists’ confusion over the true impact on their reimbursements.
“Our biggest concern with this consultation proposal that is now on the table is that CMS has not done anything to clarify how these transfers of care would be treated,” she says. For example, would hospitalists bill an admission code the first time they see a patient after being asked by a surgeon to take over that patient’s diabetes care? If so, “this proposal could actually result in some pretty good revenue increases for a lot of hospitalist practices that are doing a lot of surgical comanagement,” she says.
If hospitalists are instead required to bill a work-intensive transition of care under the code for a subsequent visit, which CMS has enforced since a 2006 rule clarification, Flores explains, HM could lose anywhere from 1% to 18% of reimbursements, depending on the exact code used.
Quality Reporting
The proposed fee schedule also is generating disappointment about what will not be included in Medicare’s Physician Quality Reporting Initiative (PQRI) for 2010. The pay-for-performance PQRI, which rewards physicians for reporting on quality measures by paying them an additional 2% of their estimated charges for covered services, will streamline some reporting requirements and increase the overall number of reportable measures. But several care-transition measures sought by SHM were not endorsed in time and will not be among them. Those measures include:
- Reconciled medication lists received by discharged patients;
- Transition records with specified elements received by discharged patients (including one measure for an inpatient discharge to home or self-care, and another for an ED discharge to home, ambulatory, or self-care); and
- Timely transmission of transition records.
“It was really a question of timing,” says Jill Epstein, senior advisor of SHM’s Performance and Standards Committee. The National Quality Forum, the nonprofit organization charged with signing off on all new measures, was not able to fully vet the recommended additions by the July 1 deadline, Epstein says, postponing their inclusion. “Our hope is that the measures will be included for 2011, of course.”
Separately, the PQRI proposal seeks to add an electronic-health-record-based mechanism to the list of eligible reporting methods. Although that addition is welcome news, Epstein says, SHM is expressing its concern about the shift toward patient-registry-based reporting, including a proposal to lessen or perhaps even discontinue claims-based reporting after 2010. “The issue for hospitalists, as well as for any specialty,” she says, “is that not every group will have access to a qualified PQRI registry as early as 2011,” particularly rural-based groups with fewer resources.
A similar change would streamline the E-Prescribing Incentive Program’s rules for how often e-prescribing codes must be reported. It also will offer more choices for how to report them, including through qualified registries. In the past, the program had little direct impact on hospitalists, but the new proposal recommends adding reporting codes specific to nursing homes, where some hospitalists provide care and could benefit from the incentives.
Paul Fishman, an economist at the Group Health Center for Health Studies in Seattle, says the increased focus on incentives in Medicare’s fee schedule suggests a growing realization of how such incentives can drive the delivery of healthcare services. “We know with absolute certainty that physicians make choices based on how things are reimbursed,” he says. Developing good outcome measures, then, will be critical for establishing pay-for-performance standards as part of a fee package that he says should include a blend of capitation and service-based and outcome-based reimbursements to strike a fairer balance.
“In healthcare, we’ve incented people to do more and more stuff, whether they improve outcomes or not, but we have to figure out a way to incent improvements in outcomes, while still retaining the long-term incentive to keep people healthy,” Fishman says. If better transitions of care result in a healthier population that is rehospitalized less often, for example, how can outcome-based incentives prevent hospitals from losing money in the long run? “We want to create the incentives to make the improvements in health outcomes, but we don’t want to punish the better actors because they are consistently lowering costs and also lowering reimbursement levels,” he says.
Achieving that balance in both Medicare and the broader healthcare system, he and other observers agree, is still very much a work in progress. TH
Bryn Nelson is a freelance writer based in Seattle.
It happens every year: A new Medicare physician fee schedule recommends a painful reduction in the rates the government doles out for more than 7,000 types of medical services performed by hospitalists, primary-care doctors, and other healthcare providers. And then Congress intervenes to keep the reduction from going into effect.
This year, however, the fee updates and policy proposals have become intertwined in the larger debate over comprehensive healthcare reform and a push toward what SHM calls a “value-based health delivery system.”
Few think the whopping 21.5% reduction proposed for 2010 rates, which are due to be published Nov. 1, actually will go into effect in January. A combination of other proposed changes to the fee schedule could soften any reduction. But the larger issue of how fees are currently calculated has become a rallying point for SHM and other healthcare-reform advocates who’d like to see the entire formula scrapped in favor of a more equitable distribution that focuses on outcomes. SHM has expressed concern that the current fee-for-service payment system “fails to provide providers with incentives to improve efficiency or quality of care, and encourages overutilization of services.”
—J. James Rohack, MD, AMA president
The current fee formula, known as the sustainable growth rate (SGR) and stipulated by the Balanced Budget Act of 1997, has resulted in a proposed rate cut every year since it went into effect in 2002. Congress consistently overrides the reimbursement cuts in one way or another, usually enacting modest increases or, such as in 2006 and 2007, an across-the-board freeze.
Hospitalists and other physicians have greeted another high-profile proposal with more enthusiasm: the removal of physician-administered drugs from the definition of “physician services,” thereby eliminating a high-cost item from the SGR formula. A Centers for Medicare and Medicaid Services (CMS) spokeswoman says the agency previously felt it lacked the authority to propose the removal. But a review earlier this year reversed that position, leading to the change. The removal, she says, “wouldn’t change the 21.5% percent decline in 2010, but it could have an impact in future years.”
American Medical Association President J. James Rohack, MD, joined the chorus of approval with a statement that asserted, “The removal of physician-administered drugs from the broken Medicare physician payment formula is a major victory for America’s seniors and their physicians.”
Consultation Change
A separate physician fee schedule proposal would eliminate payments for consultation codes in both outpatient and inpatient settings in favor of codes for evaluation and management services that carry lower reimbursement rates. Doctors would have a new way to bill for tele-health consultations, however. Leslie Flores, director of SHM’s Practice Management Institute, said the proposal has generated a high level of misinformation and misunderstanding among hospitalists who fear CMS will no longer reimburse for inpatient consultations. “It’s not that they won’t allow the work to be done anymore,” Flores says. “They’re just instructing people to bill in a different way for that work.”
CMS notes that the savings would be redistributed to increase payments for existing evaluation and management services codes, making the change cost-neutral. But Flores says a lack of details about the “crosswalk” from the old codes to the new codes, especially as they relate to transfers of care, is fueling hospitalists’ confusion over the true impact on their reimbursements.
“Our biggest concern with this consultation proposal that is now on the table is that CMS has not done anything to clarify how these transfers of care would be treated,” she says. For example, would hospitalists bill an admission code the first time they see a patient after being asked by a surgeon to take over that patient’s diabetes care? If so, “this proposal could actually result in some pretty good revenue increases for a lot of hospitalist practices that are doing a lot of surgical comanagement,” she says.
If hospitalists are instead required to bill a work-intensive transition of care under the code for a subsequent visit, which CMS has enforced since a 2006 rule clarification, Flores explains, HM could lose anywhere from 1% to 18% of reimbursements, depending on the exact code used.
Quality Reporting
The proposed fee schedule also is generating disappointment about what will not be included in Medicare’s Physician Quality Reporting Initiative (PQRI) for 2010. The pay-for-performance PQRI, which rewards physicians for reporting on quality measures by paying them an additional 2% of their estimated charges for covered services, will streamline some reporting requirements and increase the overall number of reportable measures. But several care-transition measures sought by SHM were not endorsed in time and will not be among them. Those measures include:
- Reconciled medication lists received by discharged patients;
- Transition records with specified elements received by discharged patients (including one measure for an inpatient discharge to home or self-care, and another for an ED discharge to home, ambulatory, or self-care); and
- Timely transmission of transition records.
“It was really a question of timing,” says Jill Epstein, senior advisor of SHM’s Performance and Standards Committee. The National Quality Forum, the nonprofit organization charged with signing off on all new measures, was not able to fully vet the recommended additions by the July 1 deadline, Epstein says, postponing their inclusion. “Our hope is that the measures will be included for 2011, of course.”
Separately, the PQRI proposal seeks to add an electronic-health-record-based mechanism to the list of eligible reporting methods. Although that addition is welcome news, Epstein says, SHM is expressing its concern about the shift toward patient-registry-based reporting, including a proposal to lessen or perhaps even discontinue claims-based reporting after 2010. “The issue for hospitalists, as well as for any specialty,” she says, “is that not every group will have access to a qualified PQRI registry as early as 2011,” particularly rural-based groups with fewer resources.
A similar change would streamline the E-Prescribing Incentive Program’s rules for how often e-prescribing codes must be reported. It also will offer more choices for how to report them, including through qualified registries. In the past, the program had little direct impact on hospitalists, but the new proposal recommends adding reporting codes specific to nursing homes, where some hospitalists provide care and could benefit from the incentives.
Paul Fishman, an economist at the Group Health Center for Health Studies in Seattle, says the increased focus on incentives in Medicare’s fee schedule suggests a growing realization of how such incentives can drive the delivery of healthcare services. “We know with absolute certainty that physicians make choices based on how things are reimbursed,” he says. Developing good outcome measures, then, will be critical for establishing pay-for-performance standards as part of a fee package that he says should include a blend of capitation and service-based and outcome-based reimbursements to strike a fairer balance.
“In healthcare, we’ve incented people to do more and more stuff, whether they improve outcomes or not, but we have to figure out a way to incent improvements in outcomes, while still retaining the long-term incentive to keep people healthy,” Fishman says. If better transitions of care result in a healthier population that is rehospitalized less often, for example, how can outcome-based incentives prevent hospitals from losing money in the long run? “We want to create the incentives to make the improvements in health outcomes, but we don’t want to punish the better actors because they are consistently lowering costs and also lowering reimbursement levels,” he says.
Achieving that balance in both Medicare and the broader healthcare system, he and other observers agree, is still very much a work in progress. TH
Bryn Nelson is a freelance writer based in Seattle.
Baucus Plan Lends Clarity to Healthcare Debate
Last week’s release of the “chairman’s mark” of the America’s Healthy Future Act from Senate Finance Committee Chairman Max Baucus (D-Mont.) opened the latest chapter in the debate over healthcare reform. Beyond the hot-button issues, several Medicare-related proposals could directly impact hospitalists. Here’s a look at four of them, with observations from Eric Siegal, MD, FHM, chair of SHM’s Public Policy Committee.
Addition of a hospital value-based purchasing (VBP) program to Medicare beginning in 2012. The program would tie incentive payments to performance on quality measures related to such conditions as heart failure, pneumonia, surgical care, and patient perceptions of care. So far, the program’s rough outlines have been well received. “We fundamentally support hospital value-based purchasing,” Dr. Siegal says. “We think it’s a necessary step in the evolution to higher-value health care in general.”
Expansion of the Physician’s Quality Reporting Initiative, with a 1% payment penalty by 2012 for nonparticipants. The bill also would direct the Centers for Medicare and Medicaid Services (CMS) to improve the appeals process and feedback mechanism. Although the Baucus plan’s “mark” doesn’t discuss transitioning to pay-for-performance, Dr. Siegal says the shift likely is inevitable. In the meantime, pay-for-reporting can encourage better outcomes through a public reporting mechanism and “grease the skids” for a pay-for-performance initiative.
Creation of a CMS Payment Innovation Center “authorized to test, evaluate, and expand different payment structures and methodologies,” with a goal of improving quality and reducing Medicare costs. Dr. Siegal says the proposal is consistent with SHM’s aims. “We have for a long time advocated for a robust capability to test new payment models and to figure out what works better than what we have right now,” he says.
Establishment of a three-year Medicare pilot called the Community Care Transitions Program. The program would spend $500 million over 10 years on efforts to reduce preventable rehospitalizations. SHM’s Project BOOST (Better Outcomes for Older Adults through Safe Transitions) likely would qualify. “We’re very positive about that,” Dr. Siegal says. “I think there is a huge amount of scrutiny now on avoidable rehospitalizations. We think BOOST is a step in the right direction, and we’d love to see greater funding to roll this out on a much larger basis.”
For more information on the current healthcare reform debate, visit SHM’s advocacy portal.
Last week’s release of the “chairman’s mark” of the America’s Healthy Future Act from Senate Finance Committee Chairman Max Baucus (D-Mont.) opened the latest chapter in the debate over healthcare reform. Beyond the hot-button issues, several Medicare-related proposals could directly impact hospitalists. Here’s a look at four of them, with observations from Eric Siegal, MD, FHM, chair of SHM’s Public Policy Committee.
Addition of a hospital value-based purchasing (VBP) program to Medicare beginning in 2012. The program would tie incentive payments to performance on quality measures related to such conditions as heart failure, pneumonia, surgical care, and patient perceptions of care. So far, the program’s rough outlines have been well received. “We fundamentally support hospital value-based purchasing,” Dr. Siegal says. “We think it’s a necessary step in the evolution to higher-value health care in general.”
Expansion of the Physician’s Quality Reporting Initiative, with a 1% payment penalty by 2012 for nonparticipants. The bill also would direct the Centers for Medicare and Medicaid Services (CMS) to improve the appeals process and feedback mechanism. Although the Baucus plan’s “mark” doesn’t discuss transitioning to pay-for-performance, Dr. Siegal says the shift likely is inevitable. In the meantime, pay-for-reporting can encourage better outcomes through a public reporting mechanism and “grease the skids” for a pay-for-performance initiative.
Creation of a CMS Payment Innovation Center “authorized to test, evaluate, and expand different payment structures and methodologies,” with a goal of improving quality and reducing Medicare costs. Dr. Siegal says the proposal is consistent with SHM’s aims. “We have for a long time advocated for a robust capability to test new payment models and to figure out what works better than what we have right now,” he says.
Establishment of a three-year Medicare pilot called the Community Care Transitions Program. The program would spend $500 million over 10 years on efforts to reduce preventable rehospitalizations. SHM’s Project BOOST (Better Outcomes for Older Adults through Safe Transitions) likely would qualify. “We’re very positive about that,” Dr. Siegal says. “I think there is a huge amount of scrutiny now on avoidable rehospitalizations. We think BOOST is a step in the right direction, and we’d love to see greater funding to roll this out on a much larger basis.”
For more information on the current healthcare reform debate, visit SHM’s advocacy portal.
Last week’s release of the “chairman’s mark” of the America’s Healthy Future Act from Senate Finance Committee Chairman Max Baucus (D-Mont.) opened the latest chapter in the debate over healthcare reform. Beyond the hot-button issues, several Medicare-related proposals could directly impact hospitalists. Here’s a look at four of them, with observations from Eric Siegal, MD, FHM, chair of SHM’s Public Policy Committee.
Addition of a hospital value-based purchasing (VBP) program to Medicare beginning in 2012. The program would tie incentive payments to performance on quality measures related to such conditions as heart failure, pneumonia, surgical care, and patient perceptions of care. So far, the program’s rough outlines have been well received. “We fundamentally support hospital value-based purchasing,” Dr. Siegal says. “We think it’s a necessary step in the evolution to higher-value health care in general.”
Expansion of the Physician’s Quality Reporting Initiative, with a 1% payment penalty by 2012 for nonparticipants. The bill also would direct the Centers for Medicare and Medicaid Services (CMS) to improve the appeals process and feedback mechanism. Although the Baucus plan’s “mark” doesn’t discuss transitioning to pay-for-performance, Dr. Siegal says the shift likely is inevitable. In the meantime, pay-for-reporting can encourage better outcomes through a public reporting mechanism and “grease the skids” for a pay-for-performance initiative.
Creation of a CMS Payment Innovation Center “authorized to test, evaluate, and expand different payment structures and methodologies,” with a goal of improving quality and reducing Medicare costs. Dr. Siegal says the proposal is consistent with SHM’s aims. “We have for a long time advocated for a robust capability to test new payment models and to figure out what works better than what we have right now,” he says.
Establishment of a three-year Medicare pilot called the Community Care Transitions Program. The program would spend $500 million over 10 years on efforts to reduce preventable rehospitalizations. SHM’s Project BOOST (Better Outcomes for Older Adults through Safe Transitions) likely would qualify. “We’re very positive about that,” Dr. Siegal says. “I think there is a huge amount of scrutiny now on avoidable rehospitalizations. We think BOOST is a step in the right direction, and we’d love to see greater funding to roll this out on a much larger basis.”
For more information on the current healthcare reform debate, visit SHM’s advocacy portal.
Billion-Dollar Questions
On June 30, a new government agency within the Department of Health and Human Services (HHS) called the Federal Coordinating Council for Comparative Effectiveness Research released its first report to President Obama and Congress. Authorized by the American Recovery and Reinvestment Act of 2009, the council is tasked with prioritizing and coordinating how multiple government agencies will spend the stimulus package’s $1.1 billion windfall for comparative effectiveness research (CER), which is aimed at improving healthcare outcomes in the U.S.
Of the funds, $400 million has been directed to the National Institutes of Health (NIH), $300 million to the Agency for Healthcare Research and Quality, and the remaining $400 million to the Office of the Secretary of Health and Human Services.
Patrick Conway, MD, MSc, the federal coordinating council’s executive director, is well versed in the potential impact of comparative effectiveness research on hospitalists. Just as Dr. Conway was joining the Center for Health Care Quality at Cincinnati Children’s Hospital after a fellowship at Children’s Hospital of Philadelphia, the pediatric hospitalist was named a 2007-2008 White House Fellow at HHS—the first hospitalist accepted into the program.
—Patrick Conway, MD, MSc, executive director, HHS’ Federal Coordinating Council for Comparative Effectiveness Research
In August 2008, he was tapped for the post of chief medical officer in the department’s Office of the Assistant Secretary for Planning and Evaluation.
Meanwhile, Dr. Conway still sees patients on weekends at Children’s National Medical Center in Washington, D.C. He recently talked with The Hospitalist about the challenges of coordinating research funding across multiple government agencies, how the Office of the Secretary’s $400 million allocation could be best spent, and what it all means for patient care.
Question: What are the biggest recommendations in the federal coordinating council’s report?
Answer: We approached this as “What unique role can the Office of the Secretary research funds address?” We identified data infrastructure as a potential primary investment. That includes things such as patient registries, distributed data networks, and claims databases.
Traditionally, the federal government has not invested in infrastructure because we have funded independent investigators on a one-question-by-one-question basis. The way I see this infusion of funds is it allows you to invest in data infrastructure that can then be used to answer literally hundreds of questions over time.
Secondly, we identified dissemination and translation, so how do we think about innovative ways to actually communicate directly to patients and physicians at the point of care? We also identified priority populations, including racial and ethnic minorities, persons with multiple chronic conditions, children, and the elderly. And lastly, we identified priority interventions, such as behavioral change, delivery systems, and prevention. So how do we decrease obesity, how do we decrease smoking rates?
Q: How will you address the challenge of coordinating research funding across multiple federal agencies?
A: I think the first step is doing the inventory [of CER], which is going to be an ongoing and iterative process. By doing that, then the council and the HHS have to attempt to avoid duplicating efforts and actually coordinate efforts across the federal government.
Honestly, I think the biggest challenge is these are extremely large, complex government programs. These are hundreds of millions of dollars going out to a huge variety of researchers, academic institutions, etc. One of the systems we’re trying to put in place is a better way to track what’s going on now, so we can actually coordinate going forward. It’s something as simple as we now have a common definition. We tag all money (e.g., CER), so we know exactly what we’re spending money on. That sounds really simple, but it’s actually never been done before. This is a relatively new area of emphasis for the federal government and for healthcare.
Q: What main point should hospitalists take away from this report?
A: This research will address primary questions about which medicine is best for which patient but also address larger issues, such as care coordination and how care is organized within the hospital and outside the hospital, so that we focus on the gamut of questions that have the potential to improve patient outcomes.
Q: What were some common themes you heard in the public listening sessions and online comments you solicited during the report’s preparation?
A: One of them was the importance of engaging stakeholders throughout the process, getting input from patients, physicians, policymakers. … We also heard themes about the need for infrastructure development, also the need for data infrastructure. We also heard a theme about the need for more work on research methodology and training of researchers. And then we heard a strong theme around “This needs to actually be disseminated and translated into care delivery.” So producing knowledge is helpful, but translating that knowledge into better outcomes is the ultimate goal.
Q: The report repeatedly mentions “real world” healthcare settings. Is this meant as a criticism of the idealized outcomes of efficacy research as it is typically conducted?
A: I don’t know that I would frame it as a criticism. I will say that as hospitalists, we are faced with patients every day where there’s unclear evidence about how best to manage that patient. And therefore, we need more evidence on the real questions that patients and physicians encounter in practice. I think we’ve had a long history of strong, well-funded randomized trials in this country, and I think we need to complement that with other methods of research as well, including databases, quality improvement, and measuring interventions.
Q: What are the limitations in translating all of this knowledge to interventions for the patients who need it?
A: I think the research paradigm traditionally has been: We fund an investigator. They go off for years and do their research. And then they publish it in the New England Journal [of Medicine] or JAMA, and we call that a success.
I would argue that we’re at a time where we need to think about a new paradigm, where just publishing it is some middle step. And we need to think about how you actually link the research enterprise to the care delivery enterprise, so research is rapidly implemented and you’re measuring outcomes and ensuring that research actually reaches the patients and clinicians.
Q: Are there any real-world examples of how to do this?
A: Say we had a national patient library and we thought about things that we have not traditionally thought about in healthcare—social networking, Twitter, Facebook, media channels that reach people now. How do you insert health content into those channels to actually change people’s behavior, or at least inform them? The medical establishment thinks we publish it in the New England Journal [of Medicine] and the world changes. That’s just fundamentally not true.
On the provider side, how do we think about the lay media? How do we think about channels that providers use, like UpToDate and Medscape? How do we get comparative effectiveness content into those channels that are used by providers and physicians?
Q: How should CER address the needs of patient groups that are under-represented in traditional medical studies?
A: I think that’s a huge area. Efficacy trials generally will show something works for the average patient. But the issue is, and I’ll give you a concrete example, if you are an elderly, African-American female with a couple of conditions (diabetes and heart disease), how will that treatment work for you? So I think the power of comparative effectiveness is that we, especially with the data sources we just talked about, can look at patient subgroups and get as close as possible to the individual level to really present information. Instead of [saying], this works on average patients, which includes lots of patients that don’t look at all like you, [we can] say we’ve looked and it actually works well for racial and ethnic minorities, or persons with disabilities, or the very elderly.
Q: What do you hope ultimately will come from this report?
A: On the care delivery side, this is an opportunity for hospitalists to test different interventions to improve care in the hospitals. For what I hope to achieve, I think as we invest in all these individual programs, we are building in evaluation components to assess how this impacts patient outcomes.
I think the ultimate goal is to improve patient outcomes in this country, which I know is an unbelievably grand goal, but I think you build up to that by each investment. You track what it produces and ultimately how it affects outcomes, and so you at least start to build a sense of what this program means for the nation’s health. TH
Bryn Nelson is a freelance writer based in Seattle.
On June 30, a new government agency within the Department of Health and Human Services (HHS) called the Federal Coordinating Council for Comparative Effectiveness Research released its first report to President Obama and Congress. Authorized by the American Recovery and Reinvestment Act of 2009, the council is tasked with prioritizing and coordinating how multiple government agencies will spend the stimulus package’s $1.1 billion windfall for comparative effectiveness research (CER), which is aimed at improving healthcare outcomes in the U.S.
Of the funds, $400 million has been directed to the National Institutes of Health (NIH), $300 million to the Agency for Healthcare Research and Quality, and the remaining $400 million to the Office of the Secretary of Health and Human Services.
Patrick Conway, MD, MSc, the federal coordinating council’s executive director, is well versed in the potential impact of comparative effectiveness research on hospitalists. Just as Dr. Conway was joining the Center for Health Care Quality at Cincinnati Children’s Hospital after a fellowship at Children’s Hospital of Philadelphia, the pediatric hospitalist was named a 2007-2008 White House Fellow at HHS—the first hospitalist accepted into the program.
—Patrick Conway, MD, MSc, executive director, HHS’ Federal Coordinating Council for Comparative Effectiveness Research
In August 2008, he was tapped for the post of chief medical officer in the department’s Office of the Assistant Secretary for Planning and Evaluation.
Meanwhile, Dr. Conway still sees patients on weekends at Children’s National Medical Center in Washington, D.C. He recently talked with The Hospitalist about the challenges of coordinating research funding across multiple government agencies, how the Office of the Secretary’s $400 million allocation could be best spent, and what it all means for patient care.
Question: What are the biggest recommendations in the federal coordinating council’s report?
Answer: We approached this as “What unique role can the Office of the Secretary research funds address?” We identified data infrastructure as a potential primary investment. That includes things such as patient registries, distributed data networks, and claims databases.
Traditionally, the federal government has not invested in infrastructure because we have funded independent investigators on a one-question-by-one-question basis. The way I see this infusion of funds is it allows you to invest in data infrastructure that can then be used to answer literally hundreds of questions over time.
Secondly, we identified dissemination and translation, so how do we think about innovative ways to actually communicate directly to patients and physicians at the point of care? We also identified priority populations, including racial and ethnic minorities, persons with multiple chronic conditions, children, and the elderly. And lastly, we identified priority interventions, such as behavioral change, delivery systems, and prevention. So how do we decrease obesity, how do we decrease smoking rates?
Q: How will you address the challenge of coordinating research funding across multiple federal agencies?
A: I think the first step is doing the inventory [of CER], which is going to be an ongoing and iterative process. By doing that, then the council and the HHS have to attempt to avoid duplicating efforts and actually coordinate efforts across the federal government.
Honestly, I think the biggest challenge is these are extremely large, complex government programs. These are hundreds of millions of dollars going out to a huge variety of researchers, academic institutions, etc. One of the systems we’re trying to put in place is a better way to track what’s going on now, so we can actually coordinate going forward. It’s something as simple as we now have a common definition. We tag all money (e.g., CER), so we know exactly what we’re spending money on. That sounds really simple, but it’s actually never been done before. This is a relatively new area of emphasis for the federal government and for healthcare.
Q: What main point should hospitalists take away from this report?
A: This research will address primary questions about which medicine is best for which patient but also address larger issues, such as care coordination and how care is organized within the hospital and outside the hospital, so that we focus on the gamut of questions that have the potential to improve patient outcomes.
Q: What were some common themes you heard in the public listening sessions and online comments you solicited during the report’s preparation?
A: One of them was the importance of engaging stakeholders throughout the process, getting input from patients, physicians, policymakers. … We also heard themes about the need for infrastructure development, also the need for data infrastructure. We also heard a theme about the need for more work on research methodology and training of researchers. And then we heard a strong theme around “This needs to actually be disseminated and translated into care delivery.” So producing knowledge is helpful, but translating that knowledge into better outcomes is the ultimate goal.
Q: The report repeatedly mentions “real world” healthcare settings. Is this meant as a criticism of the idealized outcomes of efficacy research as it is typically conducted?
A: I don’t know that I would frame it as a criticism. I will say that as hospitalists, we are faced with patients every day where there’s unclear evidence about how best to manage that patient. And therefore, we need more evidence on the real questions that patients and physicians encounter in practice. I think we’ve had a long history of strong, well-funded randomized trials in this country, and I think we need to complement that with other methods of research as well, including databases, quality improvement, and measuring interventions.
Q: What are the limitations in translating all of this knowledge to interventions for the patients who need it?
A: I think the research paradigm traditionally has been: We fund an investigator. They go off for years and do their research. And then they publish it in the New England Journal [of Medicine] or JAMA, and we call that a success.
I would argue that we’re at a time where we need to think about a new paradigm, where just publishing it is some middle step. And we need to think about how you actually link the research enterprise to the care delivery enterprise, so research is rapidly implemented and you’re measuring outcomes and ensuring that research actually reaches the patients and clinicians.
Q: Are there any real-world examples of how to do this?
A: Say we had a national patient library and we thought about things that we have not traditionally thought about in healthcare—social networking, Twitter, Facebook, media channels that reach people now. How do you insert health content into those channels to actually change people’s behavior, or at least inform them? The medical establishment thinks we publish it in the New England Journal [of Medicine] and the world changes. That’s just fundamentally not true.
On the provider side, how do we think about the lay media? How do we think about channels that providers use, like UpToDate and Medscape? How do we get comparative effectiveness content into those channels that are used by providers and physicians?
Q: How should CER address the needs of patient groups that are under-represented in traditional medical studies?
A: I think that’s a huge area. Efficacy trials generally will show something works for the average patient. But the issue is, and I’ll give you a concrete example, if you are an elderly, African-American female with a couple of conditions (diabetes and heart disease), how will that treatment work for you? So I think the power of comparative effectiveness is that we, especially with the data sources we just talked about, can look at patient subgroups and get as close as possible to the individual level to really present information. Instead of [saying], this works on average patients, which includes lots of patients that don’t look at all like you, [we can] say we’ve looked and it actually works well for racial and ethnic minorities, or persons with disabilities, or the very elderly.
Q: What do you hope ultimately will come from this report?
A: On the care delivery side, this is an opportunity for hospitalists to test different interventions to improve care in the hospitals. For what I hope to achieve, I think as we invest in all these individual programs, we are building in evaluation components to assess how this impacts patient outcomes.
I think the ultimate goal is to improve patient outcomes in this country, which I know is an unbelievably grand goal, but I think you build up to that by each investment. You track what it produces and ultimately how it affects outcomes, and so you at least start to build a sense of what this program means for the nation’s health. TH
Bryn Nelson is a freelance writer based in Seattle.
On June 30, a new government agency within the Department of Health and Human Services (HHS) called the Federal Coordinating Council for Comparative Effectiveness Research released its first report to President Obama and Congress. Authorized by the American Recovery and Reinvestment Act of 2009, the council is tasked with prioritizing and coordinating how multiple government agencies will spend the stimulus package’s $1.1 billion windfall for comparative effectiveness research (CER), which is aimed at improving healthcare outcomes in the U.S.
Of the funds, $400 million has been directed to the National Institutes of Health (NIH), $300 million to the Agency for Healthcare Research and Quality, and the remaining $400 million to the Office of the Secretary of Health and Human Services.
Patrick Conway, MD, MSc, the federal coordinating council’s executive director, is well versed in the potential impact of comparative effectiveness research on hospitalists. Just as Dr. Conway was joining the Center for Health Care Quality at Cincinnati Children’s Hospital after a fellowship at Children’s Hospital of Philadelphia, the pediatric hospitalist was named a 2007-2008 White House Fellow at HHS—the first hospitalist accepted into the program.
—Patrick Conway, MD, MSc, executive director, HHS’ Federal Coordinating Council for Comparative Effectiveness Research
In August 2008, he was tapped for the post of chief medical officer in the department’s Office of the Assistant Secretary for Planning and Evaluation.
Meanwhile, Dr. Conway still sees patients on weekends at Children’s National Medical Center in Washington, D.C. He recently talked with The Hospitalist about the challenges of coordinating research funding across multiple government agencies, how the Office of the Secretary’s $400 million allocation could be best spent, and what it all means for patient care.
Question: What are the biggest recommendations in the federal coordinating council’s report?
Answer: We approached this as “What unique role can the Office of the Secretary research funds address?” We identified data infrastructure as a potential primary investment. That includes things such as patient registries, distributed data networks, and claims databases.
Traditionally, the federal government has not invested in infrastructure because we have funded independent investigators on a one-question-by-one-question basis. The way I see this infusion of funds is it allows you to invest in data infrastructure that can then be used to answer literally hundreds of questions over time.
Secondly, we identified dissemination and translation, so how do we think about innovative ways to actually communicate directly to patients and physicians at the point of care? We also identified priority populations, including racial and ethnic minorities, persons with multiple chronic conditions, children, and the elderly. And lastly, we identified priority interventions, such as behavioral change, delivery systems, and prevention. So how do we decrease obesity, how do we decrease smoking rates?
Q: How will you address the challenge of coordinating research funding across multiple federal agencies?
A: I think the first step is doing the inventory [of CER], which is going to be an ongoing and iterative process. By doing that, then the council and the HHS have to attempt to avoid duplicating efforts and actually coordinate efforts across the federal government.
Honestly, I think the biggest challenge is these are extremely large, complex government programs. These are hundreds of millions of dollars going out to a huge variety of researchers, academic institutions, etc. One of the systems we’re trying to put in place is a better way to track what’s going on now, so we can actually coordinate going forward. It’s something as simple as we now have a common definition. We tag all money (e.g., CER), so we know exactly what we’re spending money on. That sounds really simple, but it’s actually never been done before. This is a relatively new area of emphasis for the federal government and for healthcare.
Q: What main point should hospitalists take away from this report?
A: This research will address primary questions about which medicine is best for which patient but also address larger issues, such as care coordination and how care is organized within the hospital and outside the hospital, so that we focus on the gamut of questions that have the potential to improve patient outcomes.
Q: What were some common themes you heard in the public listening sessions and online comments you solicited during the report’s preparation?
A: One of them was the importance of engaging stakeholders throughout the process, getting input from patients, physicians, policymakers. … We also heard themes about the need for infrastructure development, also the need for data infrastructure. We also heard a theme about the need for more work on research methodology and training of researchers. And then we heard a strong theme around “This needs to actually be disseminated and translated into care delivery.” So producing knowledge is helpful, but translating that knowledge into better outcomes is the ultimate goal.
Q: The report repeatedly mentions “real world” healthcare settings. Is this meant as a criticism of the idealized outcomes of efficacy research as it is typically conducted?
A: I don’t know that I would frame it as a criticism. I will say that as hospitalists, we are faced with patients every day where there’s unclear evidence about how best to manage that patient. And therefore, we need more evidence on the real questions that patients and physicians encounter in practice. I think we’ve had a long history of strong, well-funded randomized trials in this country, and I think we need to complement that with other methods of research as well, including databases, quality improvement, and measuring interventions.
Q: What are the limitations in translating all of this knowledge to interventions for the patients who need it?
A: I think the research paradigm traditionally has been: We fund an investigator. They go off for years and do their research. And then they publish it in the New England Journal [of Medicine] or JAMA, and we call that a success.
I would argue that we’re at a time where we need to think about a new paradigm, where just publishing it is some middle step. And we need to think about how you actually link the research enterprise to the care delivery enterprise, so research is rapidly implemented and you’re measuring outcomes and ensuring that research actually reaches the patients and clinicians.
Q: Are there any real-world examples of how to do this?
A: Say we had a national patient library and we thought about things that we have not traditionally thought about in healthcare—social networking, Twitter, Facebook, media channels that reach people now. How do you insert health content into those channels to actually change people’s behavior, or at least inform them? The medical establishment thinks we publish it in the New England Journal [of Medicine] and the world changes. That’s just fundamentally not true.
On the provider side, how do we think about the lay media? How do we think about channels that providers use, like UpToDate and Medscape? How do we get comparative effectiveness content into those channels that are used by providers and physicians?
Q: How should CER address the needs of patient groups that are under-represented in traditional medical studies?
A: I think that’s a huge area. Efficacy trials generally will show something works for the average patient. But the issue is, and I’ll give you a concrete example, if you are an elderly, African-American female with a couple of conditions (diabetes and heart disease), how will that treatment work for you? So I think the power of comparative effectiveness is that we, especially with the data sources we just talked about, can look at patient subgroups and get as close as possible to the individual level to really present information. Instead of [saying], this works on average patients, which includes lots of patients that don’t look at all like you, [we can] say we’ve looked and it actually works well for racial and ethnic minorities, or persons with disabilities, or the very elderly.
Q: What do you hope ultimately will come from this report?
A: On the care delivery side, this is an opportunity for hospitalists to test different interventions to improve care in the hospitals. For what I hope to achieve, I think as we invest in all these individual programs, we are building in evaluation components to assess how this impacts patient outcomes.
I think the ultimate goal is to improve patient outcomes in this country, which I know is an unbelievably grand goal, but I think you build up to that by each investment. You track what it produces and ultimately how it affects outcomes, and so you at least start to build a sense of what this program means for the nation’s health. TH
Bryn Nelson is a freelance writer based in Seattle.
Pharma Pledges Price Cut
The June 22 announcement of an $80 billion deal to help reduce out-of-pocket drug costs for Medicare beneficiaries has elicited mixed reactions on what it might mean for patients, and calls for hospitalists to remain vigilant about prescription drug expenses.
Under a pledge negotiated with the White House and congressional Democrats, the pharmaceutical industry has promised a 50% discount for name-brand drugs to beneficiaries stuck in the notorious gap of the Medicare Part D prescription drug plan, commonly called the “doughnut hole” (see “Beware the Doughnut Hole,” June 2009, p. 1) In 2009, the gap in coverage kicks in after $2,700 in total drug costs and persists until $6,154 in total costs, by which point patients have spent as much as $4,350 of their own money for prescription drugs.
President Obama says the gap “has been placing a crushing burden on many older Americans who live on fixed incomes and can’t afford thousands of dollars in out-of-pocket expenses.” The AARP hails the “unique solution” as a “major step forward,” though other industry observers have taken a more circumspect stance and say they want to see tougher cost-control measures in writing.
“You don’t want to look an $80 billion gift horse in the mouth, but there’s some halitosis in this mouth,” says Bill Vaughan, a health policy analyst for Consumers Union in Washington, D.C. “It’s not as pure and altruistic as it seems at first blush, and people need to keep pushing for generics because these [brand-name drugs] are grossly overpriced.”
Under the proposal, the cost for a 30-day supply of the beta-blocker drug carvedilol (Coreg) could be halved, from $142.79 to $71.40, based on Drugstore.com’s current retail prices. Even with the savings, the drug would still cost almost four and a half times more than a generic alternative, metoprolol tartrate (Lopressor), which costs $15.99 for a 30-day supply.
The deal also includes several caveats: The pledge doesn’t address the cost of brand-name drugs before or after the coverage gap, and the doughnut-hole price reduction would go into effect only if Congress enacts healthcare reform legislation.
Battles already are looming over the fight to make generics more accessible and to eliminate the doughnut hole entirely.
“I think the sense is that … everybody is going to have to give back a little bit,” says William D. Atchley Jr., MD, FACP, FHM, chief of the division of hospital medicine for Sentara Medical Group in Norfolk, Va., and a member of SHM’s Public Policy Committee. “This is a different landscape than the early 1990s. … Stakeholders are ready to be proactive and work with people.”
News accounts suggest that the pharmaceutical industry will offer an estimated $30 billion over 10 years toward narrowing the gap, while another $50 billion in concessions still must be worked out. Even so, consumer advocates like Vaughan say the need for hospitalists to help patients avoid unnecessary drug costs remains as high as ever.
Dr. Atchley, a former member of SHM’s board of directors, says hospitalists need to know what’s available in the hospital pharmacy and maintain an open line of communication with their patients in terms of their access and ability to pay for prescriptions.
“You need to understand patients’ economic status. You need to know if they get their medication from Walmart or the [Veterans Affairs] hospital pharmacy,” he says. “Cost is an issue to our Medicare patients, and it’s important to collaborate with them to make sure they can afford the drug. If they can’t, you need to work with them to find another affordable drug that will provide the same benefit.” TH
Bryn Nelson, PhD, is a freelance writer based in Seattle.
The June 22 announcement of an $80 billion deal to help reduce out-of-pocket drug costs for Medicare beneficiaries has elicited mixed reactions on what it might mean for patients, and calls for hospitalists to remain vigilant about prescription drug expenses.
Under a pledge negotiated with the White House and congressional Democrats, the pharmaceutical industry has promised a 50% discount for name-brand drugs to beneficiaries stuck in the notorious gap of the Medicare Part D prescription drug plan, commonly called the “doughnut hole” (see “Beware the Doughnut Hole,” June 2009, p. 1) In 2009, the gap in coverage kicks in after $2,700 in total drug costs and persists until $6,154 in total costs, by which point patients have spent as much as $4,350 of their own money for prescription drugs.
President Obama says the gap “has been placing a crushing burden on many older Americans who live on fixed incomes and can’t afford thousands of dollars in out-of-pocket expenses.” The AARP hails the “unique solution” as a “major step forward,” though other industry observers have taken a more circumspect stance and say they want to see tougher cost-control measures in writing.
“You don’t want to look an $80 billion gift horse in the mouth, but there’s some halitosis in this mouth,” says Bill Vaughan, a health policy analyst for Consumers Union in Washington, D.C. “It’s not as pure and altruistic as it seems at first blush, and people need to keep pushing for generics because these [brand-name drugs] are grossly overpriced.”
Under the proposal, the cost for a 30-day supply of the beta-blocker drug carvedilol (Coreg) could be halved, from $142.79 to $71.40, based on Drugstore.com’s current retail prices. Even with the savings, the drug would still cost almost four and a half times more than a generic alternative, metoprolol tartrate (Lopressor), which costs $15.99 for a 30-day supply.
The deal also includes several caveats: The pledge doesn’t address the cost of brand-name drugs before or after the coverage gap, and the doughnut-hole price reduction would go into effect only if Congress enacts healthcare reform legislation.
Battles already are looming over the fight to make generics more accessible and to eliminate the doughnut hole entirely.
“I think the sense is that … everybody is going to have to give back a little bit,” says William D. Atchley Jr., MD, FACP, FHM, chief of the division of hospital medicine for Sentara Medical Group in Norfolk, Va., and a member of SHM’s Public Policy Committee. “This is a different landscape than the early 1990s. … Stakeholders are ready to be proactive and work with people.”
News accounts suggest that the pharmaceutical industry will offer an estimated $30 billion over 10 years toward narrowing the gap, while another $50 billion in concessions still must be worked out. Even so, consumer advocates like Vaughan say the need for hospitalists to help patients avoid unnecessary drug costs remains as high as ever.
Dr. Atchley, a former member of SHM’s board of directors, says hospitalists need to know what’s available in the hospital pharmacy and maintain an open line of communication with their patients in terms of their access and ability to pay for prescriptions.
“You need to understand patients’ economic status. You need to know if they get their medication from Walmart or the [Veterans Affairs] hospital pharmacy,” he says. “Cost is an issue to our Medicare patients, and it’s important to collaborate with them to make sure they can afford the drug. If they can’t, you need to work with them to find another affordable drug that will provide the same benefit.” TH
Bryn Nelson, PhD, is a freelance writer based in Seattle.
The June 22 announcement of an $80 billion deal to help reduce out-of-pocket drug costs for Medicare beneficiaries has elicited mixed reactions on what it might mean for patients, and calls for hospitalists to remain vigilant about prescription drug expenses.
Under a pledge negotiated with the White House and congressional Democrats, the pharmaceutical industry has promised a 50% discount for name-brand drugs to beneficiaries stuck in the notorious gap of the Medicare Part D prescription drug plan, commonly called the “doughnut hole” (see “Beware the Doughnut Hole,” June 2009, p. 1) In 2009, the gap in coverage kicks in after $2,700 in total drug costs and persists until $6,154 in total costs, by which point patients have spent as much as $4,350 of their own money for prescription drugs.
President Obama says the gap “has been placing a crushing burden on many older Americans who live on fixed incomes and can’t afford thousands of dollars in out-of-pocket expenses.” The AARP hails the “unique solution” as a “major step forward,” though other industry observers have taken a more circumspect stance and say they want to see tougher cost-control measures in writing.
“You don’t want to look an $80 billion gift horse in the mouth, but there’s some halitosis in this mouth,” says Bill Vaughan, a health policy analyst for Consumers Union in Washington, D.C. “It’s not as pure and altruistic as it seems at first blush, and people need to keep pushing for generics because these [brand-name drugs] are grossly overpriced.”
Under the proposal, the cost for a 30-day supply of the beta-blocker drug carvedilol (Coreg) could be halved, from $142.79 to $71.40, based on Drugstore.com’s current retail prices. Even with the savings, the drug would still cost almost four and a half times more than a generic alternative, metoprolol tartrate (Lopressor), which costs $15.99 for a 30-day supply.
The deal also includes several caveats: The pledge doesn’t address the cost of brand-name drugs before or after the coverage gap, and the doughnut-hole price reduction would go into effect only if Congress enacts healthcare reform legislation.
Battles already are looming over the fight to make generics more accessible and to eliminate the doughnut hole entirely.
“I think the sense is that … everybody is going to have to give back a little bit,” says William D. Atchley Jr., MD, FACP, FHM, chief of the division of hospital medicine for Sentara Medical Group in Norfolk, Va., and a member of SHM’s Public Policy Committee. “This is a different landscape than the early 1990s. … Stakeholders are ready to be proactive and work with people.”
News accounts suggest that the pharmaceutical industry will offer an estimated $30 billion over 10 years toward narrowing the gap, while another $50 billion in concessions still must be worked out. Even so, consumer advocates like Vaughan say the need for hospitalists to help patients avoid unnecessary drug costs remains as high as ever.
Dr. Atchley, a former member of SHM’s board of directors, says hospitalists need to know what’s available in the hospital pharmacy and maintain an open line of communication with their patients in terms of their access and ability to pay for prescriptions.
“You need to understand patients’ economic status. You need to know if they get their medication from Walmart or the [Veterans Affairs] hospital pharmacy,” he says. “Cost is an issue to our Medicare patients, and it’s important to collaborate with them to make sure they can afford the drug. If they can’t, you need to work with them to find another affordable drug that will provide the same benefit.” TH
Bryn Nelson, PhD, is a freelance writer based in Seattle.
Pharma Promises Price Reductions
An $80 billion deal to help reduce out-of-pocket drug costs for Medicare beneficiaries has elicited mixed reactions on what it might mean for patients, as well as calls for hospitalists to remain vigilant about prescription drug expenses.
Under a pledge negotiated with the White House and congressional Democrats, the pharmaceutical industry has promised a 50% discount for name-brand drugs to beneficiaries stuck in the notorious gap of the Medicare Part D prescription drug plan, commonly called the “doughnut hole.” In 2009, the gap in coverage kicks in after $2,700 in total drug costs and persists until $6,154 in total costs, by which point patients have spent as much as $4,350 of their own money for prescription drugs.
President Obama says the gap “has been placing a crushing burden on many older Americans who live on fixed incomes and can’t afford thousands of dollars in out-of-pocket expenses.” The AARP hails the “unique solution” as a “major step forward,” though other industry observers have taken a more circumspect stance and said they want to see tougher cost-control measures in writing.
“You don’t want to look an $80 billion gift horse in the mouth, but there’s some halitosis in this mouth,” says Bill Vaughan, a health policy analyst for Consumers Union in Washington, D.C. “It’s not as pure and altruistic as it seems at first blush, and people need to keep pushing for generics because these [brand-name drugs] are grossly overpriced.”
The deal includes several caveats: The pledge doesn’t address the cost of brand-name drugs before or after the coverage gap, and the doughnut-hole price reduction would go into effect only if Congress enacts healthcare reform legislation.
William D. Atchley Jr., MD, FACP, FHM, says hospitalists need to know what’s available in the hospital pharmacy and maintain an open line of communication with their patients in terms of their access and ability to pay for prescriptions.
“You need to understand patients’ economic status. You need to know if they get their medications from Walmart or the VA hospital pharmacy,” says Dr. Atchley, chief of the division of hospital medicine for Sentara Medical Group in Norfolk, Va., and a member of SHM’s Public Policy Committee. “Cost is an issue to our Medicare patients, and it’s important to collaborate with them to make sure they can afford the drug. If they can’t, you need to work with them to find another affordable drug that will provide the same benefit.”
An $80 billion deal to help reduce out-of-pocket drug costs for Medicare beneficiaries has elicited mixed reactions on what it might mean for patients, as well as calls for hospitalists to remain vigilant about prescription drug expenses.
Under a pledge negotiated with the White House and congressional Democrats, the pharmaceutical industry has promised a 50% discount for name-brand drugs to beneficiaries stuck in the notorious gap of the Medicare Part D prescription drug plan, commonly called the “doughnut hole.” In 2009, the gap in coverage kicks in after $2,700 in total drug costs and persists until $6,154 in total costs, by which point patients have spent as much as $4,350 of their own money for prescription drugs.
President Obama says the gap “has been placing a crushing burden on many older Americans who live on fixed incomes and can’t afford thousands of dollars in out-of-pocket expenses.” The AARP hails the “unique solution” as a “major step forward,” though other industry observers have taken a more circumspect stance and said they want to see tougher cost-control measures in writing.
“You don’t want to look an $80 billion gift horse in the mouth, but there’s some halitosis in this mouth,” says Bill Vaughan, a health policy analyst for Consumers Union in Washington, D.C. “It’s not as pure and altruistic as it seems at first blush, and people need to keep pushing for generics because these [brand-name drugs] are grossly overpriced.”
The deal includes several caveats: The pledge doesn’t address the cost of brand-name drugs before or after the coverage gap, and the doughnut-hole price reduction would go into effect only if Congress enacts healthcare reform legislation.
William D. Atchley Jr., MD, FACP, FHM, says hospitalists need to know what’s available in the hospital pharmacy and maintain an open line of communication with their patients in terms of their access and ability to pay for prescriptions.
“You need to understand patients’ economic status. You need to know if they get their medications from Walmart or the VA hospital pharmacy,” says Dr. Atchley, chief of the division of hospital medicine for Sentara Medical Group in Norfolk, Va., and a member of SHM’s Public Policy Committee. “Cost is an issue to our Medicare patients, and it’s important to collaborate with them to make sure they can afford the drug. If they can’t, you need to work with them to find another affordable drug that will provide the same benefit.”
An $80 billion deal to help reduce out-of-pocket drug costs for Medicare beneficiaries has elicited mixed reactions on what it might mean for patients, as well as calls for hospitalists to remain vigilant about prescription drug expenses.
Under a pledge negotiated with the White House and congressional Democrats, the pharmaceutical industry has promised a 50% discount for name-brand drugs to beneficiaries stuck in the notorious gap of the Medicare Part D prescription drug plan, commonly called the “doughnut hole.” In 2009, the gap in coverage kicks in after $2,700 in total drug costs and persists until $6,154 in total costs, by which point patients have spent as much as $4,350 of their own money for prescription drugs.
President Obama says the gap “has been placing a crushing burden on many older Americans who live on fixed incomes and can’t afford thousands of dollars in out-of-pocket expenses.” The AARP hails the “unique solution” as a “major step forward,” though other industry observers have taken a more circumspect stance and said they want to see tougher cost-control measures in writing.
“You don’t want to look an $80 billion gift horse in the mouth, but there’s some halitosis in this mouth,” says Bill Vaughan, a health policy analyst for Consumers Union in Washington, D.C. “It’s not as pure and altruistic as it seems at first blush, and people need to keep pushing for generics because these [brand-name drugs] are grossly overpriced.”
The deal includes several caveats: The pledge doesn’t address the cost of brand-name drugs before or after the coverage gap, and the doughnut-hole price reduction would go into effect only if Congress enacts healthcare reform legislation.
William D. Atchley Jr., MD, FACP, FHM, says hospitalists need to know what’s available in the hospital pharmacy and maintain an open line of communication with their patients in terms of their access and ability to pay for prescriptions.
“You need to understand patients’ economic status. You need to know if they get their medications from Walmart or the VA hospital pharmacy,” says Dr. Atchley, chief of the division of hospital medicine for Sentara Medical Group in Norfolk, Va., and a member of SHM’s Public Policy Committee. “Cost is an issue to our Medicare patients, and it’s important to collaborate with them to make sure they can afford the drug. If they can’t, you need to work with them to find another affordable drug that will provide the same benefit.”
A Bumpy Bundling Road Ahead
Patrick J. Torcson, MD, MMM, FACP, laughs when he recalls his initial reaction to the proposal to bundle Medicare payments to hospitals: “If this passes legislation, I’m moving to Dubai.”
Dr. Torcson, chairman of SHM’s Performance and Standards Committee, and medical director of the hospitalist program at St. Tammany Parish Hospital in Covington, La., has since tempered his thinking. Like many physicians, he understands the need for Medicare to address growing costs. Nevertheless, he is wary about the bundling proposal in June’s Medicare Payment Advisory Commission (MedPAC) report to Congress.
Dr. Torcson’s opinion about reforming the nation’s healthcare delivery system points to the difficult dichotomy facing hospitalists and other physicians: they agree change is necessary, but worry about the consequences of bundling payments.
Under the new model, rather than pay for each service provided, Medicare would reimburse a lump sum for all treatment linked to an episode of care for conditions such as congestive heart failure, chronic obstructive pulmonary disease or cardiac bypass surgery. In addition, the Centers for Medicare & Medicaid Services (CMS) would provide hospitals and physicians with reports detailing their resource use and readmission rates for specific episodes of inpatient care. After two years, the providers’ reports would become public.
Another proposal would cut payments to hospitals with high risk-adjusted readmission rates for select conditions while urging Congress to ease gainsharing restrictions to financially reward physicians helping hospitals improve readmission rates and overall patient care.
—Eric Siegal, MD, chairman of SHM’s Public Policy Committee and regional medical director for Cogent Healthcare
The switch to bundling, Dr. Torcson says, could entice hospitalists to encourage a healthcare delivery model that fosters collective accountability. He and other physicians warn the system could just as easily create imbalances in power, provide incentives for withholding care and spell disaster for rural physicians and ill-prepared networks.
“Philosophically, it’s a nice idea, but I don’t think it’s realistic and I don’t think hospitals that have a small budget will be able to survive it,” says Rachel Lovins, MD, director of the hospitalist program at Waterbury Hospital in Connecticut. Dividing a bundled payment equally amongst hospital departments “will be close to impossible,” she says, and struggling hospitals will fall further into debt. The new system also may leave providers with inadequate resources and lead to angry outpatient doctors who refuse to accept Medicare patients.
Part of the problem, according to Eric Siegal, MD, chairman of SHM’s Public Policy Committee and regional medical director for Cogent Healthcare, is how little physicians know about the effects of the new plan. “Everyone understands that this is a dramatic paradigm shift,” he says. “Bundling is a really radical change. It’s going to generate all kinds of consequences—intended and unintended—and no one really has a handle on what’s going to happen.”
The Status Quo Must Change
One of few points of agreement is that the status quo is untenable. A recent summary of MedPAC’s report in The New England Journal of Medicine blamed the fee-for-service model for fueling negative aspects of the current healthcare system and warned of an escalation in Medicare spending. “Fee-for-service payment spurs spending growth, supports a fragmented and compartmentalized delivery system and does nothing to reward quality or value,” the MedPAC authors write.
Though some physicians remain cautiously optimistic about bundling, Dr. Siegal doubts the model is ready for primetime. “Bundling says, ‘Let’s create accountability for outcomes by not paying for single services but for an entire episode of care,’” he says. But many questions remain unanswered. What constitutes an episode? Who controls the allocation of the Medicare payment? If an episode is defined as 30 days from when a patient enters the hospital for a specific procedure, are other health providers accountable for addressing unrelated complaints within the same episode window?
“There are an enormous number of ways you can contort and twist this so you can create scenarios where people come out of it feeling like they have been penalized for behavior well outside their control,” Dr. Siegal says. “I think those are the big risks: imbalance of power and how do you create lines of accountability that actually make sense?”
But, he says, a system that promotes collective responsibility for patients could create a compelling incentive for more collaboration between physicians and consultants. “I think if ‘done right,’ and I say that in quotations because nobody knows what ‘done right’ means,” Dr. Siegal says, “bundling could actually be huge for hospitalists.”
Mary Dallas, MD, medical information officer at Presbyterian Healthcare Services in Albuquerque, N.M., says she’s seen first hand how collaboration among a health plan, a hospital and physicians can improve quality and balance finances. “Those efforts were really spawned out of a forced alignment between all groups in order to focus on common goals,” she says. Bundling could force a similar convergence of priorities.
Transition Troubles
If “alignment” has become the favorite watchword in bundling discussions, “gainsharing” as a concept has been greeted by far more ambivalence. “I oppose gainsharing that puts money directly into the physician’s pocket,” Dr. Dallas says. “This is something that occurs frequently in the free-market world in other industries, and to pay a few for the success that demands participation of many is just wrong in my book.”
Instead, Dr. Dallas supports the idea of directing monetary rewards toward improving infrastructure and the overall healthcare delivery process. As examples, she suggests using the money to buy time from physicians willing to be involved in pilot projects aimed at improving the delivery process, or to add more resources for better patient continuity between the hospital and the community.
Even with a more equitable distribution of resources, she and other hospitalists concede any transition to bundling could be bumpy. “If I were an independent physician, and my personal payment from Medicare was dependent on or tied to the hospital’s performance,” Dr. Dallas says, “there would be a lot of work to prepare me for this.”
As several hospitalists warn, a bundling system could trigger ratcheting down of care—and a whole new set of headaches. “The concern for everyone is that it is going to incentivize physicians to give less services,” says Jonathan Lovins, MD, director of hospitalist and midlevel practitioner services at the Hospital of Central Connecticut, and the brother of Waterbury Hospital’s Dr. Rachel Lovins.
Several hospitalists say the problem could be similar to what happened with Medicare’s capitation system, which gained traction in the 1980s and peaked in the mid-1990s before waning because of a backlash by both providers and patients. This fixed pre-payment reimbursement system, Dr. Lovins says, created an inherent conflict of interest for primary caregivers because referring patients to specialists for tests lowered profits whereas delivering fewer services did not.
Bradley Flansbaum, DO, MPH, FACP, director of hospitalist services at Lenox Hill Hospital in New York City, goes a step further, calling the bundling plan capitation on steroids, and cautions that a one-size-fits-all system is bound to fail. “Having technology and having the intellectual firepower to figure out how this system is going to manage the bundled payment is an advantage,” he says, adding that larger hospitals are more likely to have this advantage. For rural physicians or those within inefficient networks, bundling payments could be disastrous. “CMS may just say, ‘We’re turning on the lights tomorrow and tough,’ but it’s going to be a hell of a mess if they do,” he says.
A Demonstration Project
A demonstration project slated to begin in four states next year may show just how steep that learning curve is. The Acute Care Episode (ACE) Demonstration would bundle virtually all payments of certain orthopedic and cardiovascular inpatient procedures at participating hospitals in Texas, Oklahoma, New Mexico, and Colorado. Hospitals and physicians still would receive separate fee-for-service payments, but a confidential report would detail their resource use. High-resource providers would incur penalties while low-resource providers would receive bonuses.
Dr. Siegal says it makes sense to begin a bundling pilot project with procedures that have defined treatment windows, such as hip replacements or open heart surgery. Other conditions will be far more difficult to contain within a neatly defined episode. “Clearly, we’re going to have to figure out what to do with heart failure and pneumonia and stroke because those are huge consumers of dollars,” he says.
Despite all the caveats and unknowns, hospitalists still may have much to gain if bundling follows in the footsteps of the successful diagnosis-related group (DRG) payment system. “I think that enlightened hospital CEOs are going to be looking to their hospitalists as their champions to really pull this off and make this work,” Dr. Torcson says, particularly as the stakes for hospitals increase.
Medicare’s Physician Quality Reporting Initiative, established by the 2006 Tax Relief and Health Care Act, already links a 1.5% financial incentive to increased performance. With bundled payments adjusted up or down by the proposed gainsharing and penalties for higher readmission rates, Dr. Torcson says, the equivalent of 3% to 5% of DRG payments could be at risk.
“I think it could be something potentially very beneficial to those hospitalist groups that get it right,” he says. “It’s kind of like before the Ice Age comes, if you’ve got your animal skins ready, those are the tribes that survive.” TH
Gretchen Henkel is a medical writer based in California.
Patrick J. Torcson, MD, MMM, FACP, laughs when he recalls his initial reaction to the proposal to bundle Medicare payments to hospitals: “If this passes legislation, I’m moving to Dubai.”
Dr. Torcson, chairman of SHM’s Performance and Standards Committee, and medical director of the hospitalist program at St. Tammany Parish Hospital in Covington, La., has since tempered his thinking. Like many physicians, he understands the need for Medicare to address growing costs. Nevertheless, he is wary about the bundling proposal in June’s Medicare Payment Advisory Commission (MedPAC) report to Congress.
Dr. Torcson’s opinion about reforming the nation’s healthcare delivery system points to the difficult dichotomy facing hospitalists and other physicians: they agree change is necessary, but worry about the consequences of bundling payments.
Under the new model, rather than pay for each service provided, Medicare would reimburse a lump sum for all treatment linked to an episode of care for conditions such as congestive heart failure, chronic obstructive pulmonary disease or cardiac bypass surgery. In addition, the Centers for Medicare & Medicaid Services (CMS) would provide hospitals and physicians with reports detailing their resource use and readmission rates for specific episodes of inpatient care. After two years, the providers’ reports would become public.
Another proposal would cut payments to hospitals with high risk-adjusted readmission rates for select conditions while urging Congress to ease gainsharing restrictions to financially reward physicians helping hospitals improve readmission rates and overall patient care.
—Eric Siegal, MD, chairman of SHM’s Public Policy Committee and regional medical director for Cogent Healthcare
The switch to bundling, Dr. Torcson says, could entice hospitalists to encourage a healthcare delivery model that fosters collective accountability. He and other physicians warn the system could just as easily create imbalances in power, provide incentives for withholding care and spell disaster for rural physicians and ill-prepared networks.
“Philosophically, it’s a nice idea, but I don’t think it’s realistic and I don’t think hospitals that have a small budget will be able to survive it,” says Rachel Lovins, MD, director of the hospitalist program at Waterbury Hospital in Connecticut. Dividing a bundled payment equally amongst hospital departments “will be close to impossible,” she says, and struggling hospitals will fall further into debt. The new system also may leave providers with inadequate resources and lead to angry outpatient doctors who refuse to accept Medicare patients.
Part of the problem, according to Eric Siegal, MD, chairman of SHM’s Public Policy Committee and regional medical director for Cogent Healthcare, is how little physicians know about the effects of the new plan. “Everyone understands that this is a dramatic paradigm shift,” he says. “Bundling is a really radical change. It’s going to generate all kinds of consequences—intended and unintended—and no one really has a handle on what’s going to happen.”
The Status Quo Must Change
One of few points of agreement is that the status quo is untenable. A recent summary of MedPAC’s report in The New England Journal of Medicine blamed the fee-for-service model for fueling negative aspects of the current healthcare system and warned of an escalation in Medicare spending. “Fee-for-service payment spurs spending growth, supports a fragmented and compartmentalized delivery system and does nothing to reward quality or value,” the MedPAC authors write.
Though some physicians remain cautiously optimistic about bundling, Dr. Siegal doubts the model is ready for primetime. “Bundling says, ‘Let’s create accountability for outcomes by not paying for single services but for an entire episode of care,’” he says. But many questions remain unanswered. What constitutes an episode? Who controls the allocation of the Medicare payment? If an episode is defined as 30 days from when a patient enters the hospital for a specific procedure, are other health providers accountable for addressing unrelated complaints within the same episode window?
“There are an enormous number of ways you can contort and twist this so you can create scenarios where people come out of it feeling like they have been penalized for behavior well outside their control,” Dr. Siegal says. “I think those are the big risks: imbalance of power and how do you create lines of accountability that actually make sense?”
But, he says, a system that promotes collective responsibility for patients could create a compelling incentive for more collaboration between physicians and consultants. “I think if ‘done right,’ and I say that in quotations because nobody knows what ‘done right’ means,” Dr. Siegal says, “bundling could actually be huge for hospitalists.”
Mary Dallas, MD, medical information officer at Presbyterian Healthcare Services in Albuquerque, N.M., says she’s seen first hand how collaboration among a health plan, a hospital and physicians can improve quality and balance finances. “Those efforts were really spawned out of a forced alignment between all groups in order to focus on common goals,” she says. Bundling could force a similar convergence of priorities.
Transition Troubles
If “alignment” has become the favorite watchword in bundling discussions, “gainsharing” as a concept has been greeted by far more ambivalence. “I oppose gainsharing that puts money directly into the physician’s pocket,” Dr. Dallas says. “This is something that occurs frequently in the free-market world in other industries, and to pay a few for the success that demands participation of many is just wrong in my book.”
Instead, Dr. Dallas supports the idea of directing monetary rewards toward improving infrastructure and the overall healthcare delivery process. As examples, she suggests using the money to buy time from physicians willing to be involved in pilot projects aimed at improving the delivery process, or to add more resources for better patient continuity between the hospital and the community.
Even with a more equitable distribution of resources, she and other hospitalists concede any transition to bundling could be bumpy. “If I were an independent physician, and my personal payment from Medicare was dependent on or tied to the hospital’s performance,” Dr. Dallas says, “there would be a lot of work to prepare me for this.”
As several hospitalists warn, a bundling system could trigger ratcheting down of care—and a whole new set of headaches. “The concern for everyone is that it is going to incentivize physicians to give less services,” says Jonathan Lovins, MD, director of hospitalist and midlevel practitioner services at the Hospital of Central Connecticut, and the brother of Waterbury Hospital’s Dr. Rachel Lovins.
Several hospitalists say the problem could be similar to what happened with Medicare’s capitation system, which gained traction in the 1980s and peaked in the mid-1990s before waning because of a backlash by both providers and patients. This fixed pre-payment reimbursement system, Dr. Lovins says, created an inherent conflict of interest for primary caregivers because referring patients to specialists for tests lowered profits whereas delivering fewer services did not.
Bradley Flansbaum, DO, MPH, FACP, director of hospitalist services at Lenox Hill Hospital in New York City, goes a step further, calling the bundling plan capitation on steroids, and cautions that a one-size-fits-all system is bound to fail. “Having technology and having the intellectual firepower to figure out how this system is going to manage the bundled payment is an advantage,” he says, adding that larger hospitals are more likely to have this advantage. For rural physicians or those within inefficient networks, bundling payments could be disastrous. “CMS may just say, ‘We’re turning on the lights tomorrow and tough,’ but it’s going to be a hell of a mess if they do,” he says.
A Demonstration Project
A demonstration project slated to begin in four states next year may show just how steep that learning curve is. The Acute Care Episode (ACE) Demonstration would bundle virtually all payments of certain orthopedic and cardiovascular inpatient procedures at participating hospitals in Texas, Oklahoma, New Mexico, and Colorado. Hospitals and physicians still would receive separate fee-for-service payments, but a confidential report would detail their resource use. High-resource providers would incur penalties while low-resource providers would receive bonuses.
Dr. Siegal says it makes sense to begin a bundling pilot project with procedures that have defined treatment windows, such as hip replacements or open heart surgery. Other conditions will be far more difficult to contain within a neatly defined episode. “Clearly, we’re going to have to figure out what to do with heart failure and pneumonia and stroke because those are huge consumers of dollars,” he says.
Despite all the caveats and unknowns, hospitalists still may have much to gain if bundling follows in the footsteps of the successful diagnosis-related group (DRG) payment system. “I think that enlightened hospital CEOs are going to be looking to their hospitalists as their champions to really pull this off and make this work,” Dr. Torcson says, particularly as the stakes for hospitals increase.
Medicare’s Physician Quality Reporting Initiative, established by the 2006 Tax Relief and Health Care Act, already links a 1.5% financial incentive to increased performance. With bundled payments adjusted up or down by the proposed gainsharing and penalties for higher readmission rates, Dr. Torcson says, the equivalent of 3% to 5% of DRG payments could be at risk.
“I think it could be something potentially very beneficial to those hospitalist groups that get it right,” he says. “It’s kind of like before the Ice Age comes, if you’ve got your animal skins ready, those are the tribes that survive.” TH
Gretchen Henkel is a medical writer based in California.
Patrick J. Torcson, MD, MMM, FACP, laughs when he recalls his initial reaction to the proposal to bundle Medicare payments to hospitals: “If this passes legislation, I’m moving to Dubai.”
Dr. Torcson, chairman of SHM’s Performance and Standards Committee, and medical director of the hospitalist program at St. Tammany Parish Hospital in Covington, La., has since tempered his thinking. Like many physicians, he understands the need for Medicare to address growing costs. Nevertheless, he is wary about the bundling proposal in June’s Medicare Payment Advisory Commission (MedPAC) report to Congress.
Dr. Torcson’s opinion about reforming the nation’s healthcare delivery system points to the difficult dichotomy facing hospitalists and other physicians: they agree change is necessary, but worry about the consequences of bundling payments.
Under the new model, rather than pay for each service provided, Medicare would reimburse a lump sum for all treatment linked to an episode of care for conditions such as congestive heart failure, chronic obstructive pulmonary disease or cardiac bypass surgery. In addition, the Centers for Medicare & Medicaid Services (CMS) would provide hospitals and physicians with reports detailing their resource use and readmission rates for specific episodes of inpatient care. After two years, the providers’ reports would become public.
Another proposal would cut payments to hospitals with high risk-adjusted readmission rates for select conditions while urging Congress to ease gainsharing restrictions to financially reward physicians helping hospitals improve readmission rates and overall patient care.
—Eric Siegal, MD, chairman of SHM’s Public Policy Committee and regional medical director for Cogent Healthcare
The switch to bundling, Dr. Torcson says, could entice hospitalists to encourage a healthcare delivery model that fosters collective accountability. He and other physicians warn the system could just as easily create imbalances in power, provide incentives for withholding care and spell disaster for rural physicians and ill-prepared networks.
“Philosophically, it’s a nice idea, but I don’t think it’s realistic and I don’t think hospitals that have a small budget will be able to survive it,” says Rachel Lovins, MD, director of the hospitalist program at Waterbury Hospital in Connecticut. Dividing a bundled payment equally amongst hospital departments “will be close to impossible,” she says, and struggling hospitals will fall further into debt. The new system also may leave providers with inadequate resources and lead to angry outpatient doctors who refuse to accept Medicare patients.
Part of the problem, according to Eric Siegal, MD, chairman of SHM’s Public Policy Committee and regional medical director for Cogent Healthcare, is how little physicians know about the effects of the new plan. “Everyone understands that this is a dramatic paradigm shift,” he says. “Bundling is a really radical change. It’s going to generate all kinds of consequences—intended and unintended—and no one really has a handle on what’s going to happen.”
The Status Quo Must Change
One of few points of agreement is that the status quo is untenable. A recent summary of MedPAC’s report in The New England Journal of Medicine blamed the fee-for-service model for fueling negative aspects of the current healthcare system and warned of an escalation in Medicare spending. “Fee-for-service payment spurs spending growth, supports a fragmented and compartmentalized delivery system and does nothing to reward quality or value,” the MedPAC authors write.
Though some physicians remain cautiously optimistic about bundling, Dr. Siegal doubts the model is ready for primetime. “Bundling says, ‘Let’s create accountability for outcomes by not paying for single services but for an entire episode of care,’” he says. But many questions remain unanswered. What constitutes an episode? Who controls the allocation of the Medicare payment? If an episode is defined as 30 days from when a patient enters the hospital for a specific procedure, are other health providers accountable for addressing unrelated complaints within the same episode window?
“There are an enormous number of ways you can contort and twist this so you can create scenarios where people come out of it feeling like they have been penalized for behavior well outside their control,” Dr. Siegal says. “I think those are the big risks: imbalance of power and how do you create lines of accountability that actually make sense?”
But, he says, a system that promotes collective responsibility for patients could create a compelling incentive for more collaboration between physicians and consultants. “I think if ‘done right,’ and I say that in quotations because nobody knows what ‘done right’ means,” Dr. Siegal says, “bundling could actually be huge for hospitalists.”
Mary Dallas, MD, medical information officer at Presbyterian Healthcare Services in Albuquerque, N.M., says she’s seen first hand how collaboration among a health plan, a hospital and physicians can improve quality and balance finances. “Those efforts were really spawned out of a forced alignment between all groups in order to focus on common goals,” she says. Bundling could force a similar convergence of priorities.
Transition Troubles
If “alignment” has become the favorite watchword in bundling discussions, “gainsharing” as a concept has been greeted by far more ambivalence. “I oppose gainsharing that puts money directly into the physician’s pocket,” Dr. Dallas says. “This is something that occurs frequently in the free-market world in other industries, and to pay a few for the success that demands participation of many is just wrong in my book.”
Instead, Dr. Dallas supports the idea of directing monetary rewards toward improving infrastructure and the overall healthcare delivery process. As examples, she suggests using the money to buy time from physicians willing to be involved in pilot projects aimed at improving the delivery process, or to add more resources for better patient continuity between the hospital and the community.
Even with a more equitable distribution of resources, she and other hospitalists concede any transition to bundling could be bumpy. “If I were an independent physician, and my personal payment from Medicare was dependent on or tied to the hospital’s performance,” Dr. Dallas says, “there would be a lot of work to prepare me for this.”
As several hospitalists warn, a bundling system could trigger ratcheting down of care—and a whole new set of headaches. “The concern for everyone is that it is going to incentivize physicians to give less services,” says Jonathan Lovins, MD, director of hospitalist and midlevel practitioner services at the Hospital of Central Connecticut, and the brother of Waterbury Hospital’s Dr. Rachel Lovins.
Several hospitalists say the problem could be similar to what happened with Medicare’s capitation system, which gained traction in the 1980s and peaked in the mid-1990s before waning because of a backlash by both providers and patients. This fixed pre-payment reimbursement system, Dr. Lovins says, created an inherent conflict of interest for primary caregivers because referring patients to specialists for tests lowered profits whereas delivering fewer services did not.
Bradley Flansbaum, DO, MPH, FACP, director of hospitalist services at Lenox Hill Hospital in New York City, goes a step further, calling the bundling plan capitation on steroids, and cautions that a one-size-fits-all system is bound to fail. “Having technology and having the intellectual firepower to figure out how this system is going to manage the bundled payment is an advantage,” he says, adding that larger hospitals are more likely to have this advantage. For rural physicians or those within inefficient networks, bundling payments could be disastrous. “CMS may just say, ‘We’re turning on the lights tomorrow and tough,’ but it’s going to be a hell of a mess if they do,” he says.
A Demonstration Project
A demonstration project slated to begin in four states next year may show just how steep that learning curve is. The Acute Care Episode (ACE) Demonstration would bundle virtually all payments of certain orthopedic and cardiovascular inpatient procedures at participating hospitals in Texas, Oklahoma, New Mexico, and Colorado. Hospitals and physicians still would receive separate fee-for-service payments, but a confidential report would detail their resource use. High-resource providers would incur penalties while low-resource providers would receive bonuses.
Dr. Siegal says it makes sense to begin a bundling pilot project with procedures that have defined treatment windows, such as hip replacements or open heart surgery. Other conditions will be far more difficult to contain within a neatly defined episode. “Clearly, we’re going to have to figure out what to do with heart failure and pneumonia and stroke because those are huge consumers of dollars,” he says.
Despite all the caveats and unknowns, hospitalists still may have much to gain if bundling follows in the footsteps of the successful diagnosis-related group (DRG) payment system. “I think that enlightened hospital CEOs are going to be looking to their hospitalists as their champions to really pull this off and make this work,” Dr. Torcson says, particularly as the stakes for hospitals increase.
Medicare’s Physician Quality Reporting Initiative, established by the 2006 Tax Relief and Health Care Act, already links a 1.5% financial incentive to increased performance. With bundled payments adjusted up or down by the proposed gainsharing and penalties for higher readmission rates, Dr. Torcson says, the equivalent of 3% to 5% of DRG payments could be at risk.
“I think it could be something potentially very beneficial to those hospitalist groups that get it right,” he says. “It’s kind of like before the Ice Age comes, if you’ve got your animal skins ready, those are the tribes that survive.” TH
Gretchen Henkel is a medical writer based in California.
The Ultrasound Advantage
The iPhone may be the latest “it” gadget, but a flurry of recent innovation has given portable ultrasound devices a healthy buzz within the biomedical community.
Beyond the gee-whiz factor, though, a growing number of studies demonstrate the everyday value of putting portable units in the hands of hospitalists.
“The big news has been the tiny portable scanner,” says Stephen Smith, a biomedical engineer at Duke University, in North Carolina, and a pioneer in ultrasound technology. Siemens recently introduced a hand-held device called the Acuson P10, which weighs 1.6 pounds, retails for $9,499 and can fit within a hospitalist’s coat pocket. Not to be outdone, GE has announced plans to introduce an ultrasound unit no bigger than an iPod.
Smith and his collaborators have taken the technology one step farther. They incorporate electrocardial leads on the unit’s transducer face to permit electrocardiograms and a microphone to let hospitalists use the ultrasound like a stethoscope.
Eric Isaacs, MD, a clinical professor of medicine at San Francisco General Hospital, says he routinely uses ultrasound for vascular access “to ensure the safety of procedures that we previously performed either blind or by anatomical landmarks.” Beyond improving the accuracy of placing central and peripheral lines, he says, “the reason we are using ultrasound more now is that the machine is so portable. The radiologists are no longer in the hospital 24 hours a day, and so by necessity we are using the tools that were previously only accessible from 9 to 5.”
Range of Uses
Among the reports recognizing ultrasound’s value, he cited a 2003 study in the British Medical Journal affirming the technology’s superiority to relying on physical landmarks in gaining central venous access, resulting in a lower technical failure rate, reduced complications, and faster access.1 Dr. Issacs says ultrasound also has helped guide procedures such as thorancentesis and paracentesis, other applications once confined to radiology. “It’s something that’s allowing me to do at the bedside what I would otherwise have to wait several hours for,” he says.
For heart patients, he says, a hospitalist can bring ultrasound to the bedside during a cardiac arrest to inspect cardiac motion and fluid, and monitor the patient’s hydration status by examining the size of the inferior vena cava. Internists likewise could examine the size of a patient’s aorta to look for signs of an aneurism, especially for a patient experiencing abdominal pain in the middle of the night. “Quite frankly, it seems like the only limit to ultrasound use is imagination,” Dr. Isaacs says.
Robert Rodriguez, MD, a clinical professor of medicine and emergency medicine at San Francisco General Hospital, says he uses ultrasound on 25% of the patients he sees on an in-patient basis. His biggest use, he says, is for placing central lines—though that could soon change.
“I work with a population that has a very high percentage of injection drug abuse, in whom it’s very difficult to find even a peripheral vein,” he says. At least once a day, he uses ultrasound to locate the brachial vein for such peripheral lines, circumventing the need for a central line through the subclavian vein and the risk of a pneumothorax. “In the past, we would have to put in a central line for just about anything,” he says. “And now we can put in a peripheral line that saves them the risk.”
Another benefit, he says, is in breeding better patient interactions—for example, with gallstones. “You can say to the patient: ‘This is the gallbladder, these are the stones in the gallbladder, this is what’s causing the pain,’” he says. “I think patients appreciate being able to see that firsthand. I think they also appreciate that it’s going to lessen their likelihood of having a complication.”
At the University of Chicago Medical Center, cardiologist Kirk Spencer, MD, says ultrasound procedures still are performed mainly by sonographers and cardiologists. He hopes to change that with a slew of studies demonstrating the feasibility of putting portable ultrasound in the hands of internists.
In one study, hospitalized patients indicated for echocardiography received an echocardiogram, while all others were examined with ultrasound. “We found a significant number of cardio pathologies,” Dr. Spencer says. The findings, he says, were independent of specific medical complaints, such as endocrinology or orthopedic problems.2 “If you were sick enough to get in the hospital, there was a chance that you had a significant cardiac problem that needed to be addressed,” he says.
The study that most excites Dr. Spencer was presented at the 2007 IEEE International Ultrasonics Symposium in October.2 It looked at using ultrasound before releasing a cardiac patient. “One of the biggest problems, one of the most common diagnoses is congestive heart failure,” he says, with a six-month readmission rate of 30% to 40%. Giving ultrasound devices to internists allowed them to look at the amount of fluid around the heart of each cardiac patient.
“The patients who got readmitted all had more fluid detected by ultrasound,” Dr. Spencer says. “So we can do that and say, ‘Hey, you need to stay in the hospital two more days. But if that prevents you from coming back in six months, then that’s a good thing.’”
In patients diagnosed with congestive heart failure, he and his collaborators found, the mean fluid volume was higher for those who were later readmitted. Dr. Spencer plans to pick a reasonable cut-off value and prospectively test whether delaying the release of patients whose fluid levels exceed that value can cut readmission rates.
Most of the battery-operated units used by the medical center weigh between 6 to 10 pounds and cost between $12,000 and $20,000, he says. The devices, about twice the thickness of an iBook, can easily be carried on a shoulder strap. Echocardiogram machines, by contrast, weigh about 300 pounds, must be plugged in and retail for about $250,000.
Concerns, Obstacles
Dr. Spencer cautioned that ultrasound shouldn’t replace echocardiograms or other tools. “So no one is proposing that this would replace a full exam,” he says. “What we’re hoping is that this would detect things that have gone missing or would help ask very specific questions at the bedside.” His studies suggest the approach works well as long as the questions are simple: “Is there fluid or not? Is the heart good or bad?’ But not: ‘Is there an infection?’”
Beyond cardiology and the emergency room, Dr. Spencer says ultrasound has obvious imaging uses in the ICU. The dichotomy, he says, is that imaging intensive care patients can be especially difficult due to their edema, wounds, and lack of mobility. “That area has not blossomed as well as it could have,” he says.
Even so, the burgeoning number of applications for ultrasound “really has huge potential for good,” says Harvey Nisenbaum, MD, an associate professor of radiology at the University of Pennsylvania School of Medicine and president-elect of the American Institute of Ultrasound in Medicine (AIUM). “But the problem is that it’s an art form in the sense that it’s not automated.” No two ultrasound images will be identical, for example, because each depends upon the probe’s precise location. The key, Dr. Nisenbaum says, is proper training under agreed-upon guidelines, followed by continuing education and the maintenance of a hospitalist’s competency.
The AIUM, Nisenbaum says, is working to develop standard credentialing criteria for a range of ultrasound applications to help unify what has been a patchwork approach. Another limitation, he says, has been the lack of Food and Drug Administration (FDA) approval for ultrasound contrast agents Optison and Definity for noncardiac applications. Several deaths have been linked to the use of the intravenous agents in the sickest patients.
The institute is working with the FDA on trying to get the reagents approved for broader use, as they are in other countries. Nisenbaum cautioned the process likely will take a while. Once approved, getting a reimbursement code established for insurance purposes could take even longer.
A further obstacle, according to Dr. Spencer, is the lack of resolution surrounding medical legal issues. “Are we going to agree that this is like a physical examination?” he asks. “It’s unclear whether the medical legal community is going to accept that with ultrasound,” he says.
For cardiology applications, at least, he wonders if the push for reimbursement is such a good thing. “General internists are under incredible pressure [for billing],” he says. “They’re in a really tough spot, and so there would be enormous pressure to get reimbursed for every ultrasound.” As it is, he says, Medicare is targeting echocardiogram as an overutilized reimbursement item. “I hope the reason we’re using this is because we’re examining the patients anyway and this would allow us to find things that we might have missed,” he says. “It’s a better way of examining people, not a new technique for generating revenues. I think that would be a disaster.”
Jeffrey Wiese, MD, SHM board member and associate dean of graduate medical education at Tulane University School of Medicine’s Section of General Internal Medicine and Geriatrics in New Orleans, began putting ultrasound in the hands of his hospitalists and residents in 2007. It’s the “100% right thing to do,” he advises hospitalist groups. “It can be a meaningful way of improving safety. I hope that everyody would move that way.”
Dr. Wiese says residents began using ultrasound more and more for extra visualization during procedures.
“The reason we got into this was straightaway safety, independent of [Centers for Medicare and Medicaid Services] codes and billing—particularly regarding thoracentesis and internal lines,’’ he says. His hospitalists use SonaSite’s MicroMaxx system, “which was a key piece in the way of being able to bill. For all CMT just like endoscopy and bronchoscopy, you have to provide images of the procedure to prove you did it. With the MicroMaxx machine, it allows you to insert a USB and pull down images, take them to a print machine, print them out, and put them in a chart.”
Dr. Wiese touts the sheer amount of what hospitalists can use ultrasound for. “You can do echoes and abdominal ultrasound—not at the level of the radiology room or the cardiology lab, but you can get a quick look,” he says.
Should other hospitalist programs go in the same direction? “From a quality perspective there’s no question you go down that road,” Dr. Wiese asserts. “You do the math: How much does one pneumothorax cost? That’s especially true if [a] pneuothorax finds its way to CMS. One pneuomothorax that you prevent probably pays for your [$20,000-$30,000] machine. That’s even before you get into issues of billing for the use of it, which I think is a secondary way of funding the purchase.”
Forging Ahead
In the meantime, researchers are focusing on ever-diverse applications and smaller units.
At the Mayo Clinic in Jacksonville, Fla., director of regional anesthesia Steven Clendenen, MD, has pioneered the use of ultrasound for guiding nerve blocks.3 The imaging has “totally revolutionized” how the hospital manages pain, he says. As yet, the device still is cart-based, though he expects its size to shrink considerably. “You remember the first calculators, how big they were, and now look at them,” he says.
Beyond working toward miniaturized ultrasound units, Duke’s Smith has been developing real-time three-dimensional angiograms of blood vessels in the brain, a potential boon for stroke diagnoses.4 Another project may bring hospital-based ultrasound full circle: a device that produces a 3-D stereo-image, “like in the IMAX theater,” he says.5 Smith and his colleagues have modified a commercial scanner, “so the target comes out of the screen at you.” Among the many potential uses, expectant parents could see a 3-D stereo view of the developing fetus—something not even the iPhone can offer. TH
Bryn Nelson is a science journalist based in New York.
References
- Hind, D, Calvert, N, McWilliams, R, Davidson, A, Paisley, S, Beverley, C, Thomas, S. Ultrasonic locating devices for central venous cannulation: meta-analysis. Br Med J. 2003;327(7411):361.
- Fedson, S, Neithardt, G, Thomas, P, et al. Unsuspected clinically important findings detected with a small portable ultrasound device in patients admitted to a general medicine service. J Am Soc Echocardiogr. 2003;16(9):901-905.
- Feinglass NG, Clendenen SR, Torp KD, Wang RD, Castello R, Greengrass RA. Real-time three-dimensional ultrasound for continuous popliteal blockade: a case report and image description. Anesth Analg. 2007;105(1):272-274.
- Smith SW, Chu K, Idriss SF, Ivancevich NM, Light ED, Wolf PD. Feasibility Study: Real time 3D ultrasound imaging of the brain. Ultras Med Biol. 2004;30:1365-1371.
- Noble JR, Fronheiser MP, Smith SW. Real-time Stereo 3D Ultrasound. Ultrason Imaging. 2006;28:245-254.
The iPhone may be the latest “it” gadget, but a flurry of recent innovation has given portable ultrasound devices a healthy buzz within the biomedical community.
Beyond the gee-whiz factor, though, a growing number of studies demonstrate the everyday value of putting portable units in the hands of hospitalists.
“The big news has been the tiny portable scanner,” says Stephen Smith, a biomedical engineer at Duke University, in North Carolina, and a pioneer in ultrasound technology. Siemens recently introduced a hand-held device called the Acuson P10, which weighs 1.6 pounds, retails for $9,499 and can fit within a hospitalist’s coat pocket. Not to be outdone, GE has announced plans to introduce an ultrasound unit no bigger than an iPod.
Smith and his collaborators have taken the technology one step farther. They incorporate electrocardial leads on the unit’s transducer face to permit electrocardiograms and a microphone to let hospitalists use the ultrasound like a stethoscope.
Eric Isaacs, MD, a clinical professor of medicine at San Francisco General Hospital, says he routinely uses ultrasound for vascular access “to ensure the safety of procedures that we previously performed either blind or by anatomical landmarks.” Beyond improving the accuracy of placing central and peripheral lines, he says, “the reason we are using ultrasound more now is that the machine is so portable. The radiologists are no longer in the hospital 24 hours a day, and so by necessity we are using the tools that were previously only accessible from 9 to 5.”
Range of Uses
Among the reports recognizing ultrasound’s value, he cited a 2003 study in the British Medical Journal affirming the technology’s superiority to relying on physical landmarks in gaining central venous access, resulting in a lower technical failure rate, reduced complications, and faster access.1 Dr. Issacs says ultrasound also has helped guide procedures such as thorancentesis and paracentesis, other applications once confined to radiology. “It’s something that’s allowing me to do at the bedside what I would otherwise have to wait several hours for,” he says.
For heart patients, he says, a hospitalist can bring ultrasound to the bedside during a cardiac arrest to inspect cardiac motion and fluid, and monitor the patient’s hydration status by examining the size of the inferior vena cava. Internists likewise could examine the size of a patient’s aorta to look for signs of an aneurism, especially for a patient experiencing abdominal pain in the middle of the night. “Quite frankly, it seems like the only limit to ultrasound use is imagination,” Dr. Isaacs says.
Robert Rodriguez, MD, a clinical professor of medicine and emergency medicine at San Francisco General Hospital, says he uses ultrasound on 25% of the patients he sees on an in-patient basis. His biggest use, he says, is for placing central lines—though that could soon change.
“I work with a population that has a very high percentage of injection drug abuse, in whom it’s very difficult to find even a peripheral vein,” he says. At least once a day, he uses ultrasound to locate the brachial vein for such peripheral lines, circumventing the need for a central line through the subclavian vein and the risk of a pneumothorax. “In the past, we would have to put in a central line for just about anything,” he says. “And now we can put in a peripheral line that saves them the risk.”
Another benefit, he says, is in breeding better patient interactions—for example, with gallstones. “You can say to the patient: ‘This is the gallbladder, these are the stones in the gallbladder, this is what’s causing the pain,’” he says. “I think patients appreciate being able to see that firsthand. I think they also appreciate that it’s going to lessen their likelihood of having a complication.”
At the University of Chicago Medical Center, cardiologist Kirk Spencer, MD, says ultrasound procedures still are performed mainly by sonographers and cardiologists. He hopes to change that with a slew of studies demonstrating the feasibility of putting portable ultrasound in the hands of internists.
In one study, hospitalized patients indicated for echocardiography received an echocardiogram, while all others were examined with ultrasound. “We found a significant number of cardio pathologies,” Dr. Spencer says. The findings, he says, were independent of specific medical complaints, such as endocrinology or orthopedic problems.2 “If you were sick enough to get in the hospital, there was a chance that you had a significant cardiac problem that needed to be addressed,” he says.
The study that most excites Dr. Spencer was presented at the 2007 IEEE International Ultrasonics Symposium in October.2 It looked at using ultrasound before releasing a cardiac patient. “One of the biggest problems, one of the most common diagnoses is congestive heart failure,” he says, with a six-month readmission rate of 30% to 40%. Giving ultrasound devices to internists allowed them to look at the amount of fluid around the heart of each cardiac patient.
“The patients who got readmitted all had more fluid detected by ultrasound,” Dr. Spencer says. “So we can do that and say, ‘Hey, you need to stay in the hospital two more days. But if that prevents you from coming back in six months, then that’s a good thing.’”
In patients diagnosed with congestive heart failure, he and his collaborators found, the mean fluid volume was higher for those who were later readmitted. Dr. Spencer plans to pick a reasonable cut-off value and prospectively test whether delaying the release of patients whose fluid levels exceed that value can cut readmission rates.
Most of the battery-operated units used by the medical center weigh between 6 to 10 pounds and cost between $12,000 and $20,000, he says. The devices, about twice the thickness of an iBook, can easily be carried on a shoulder strap. Echocardiogram machines, by contrast, weigh about 300 pounds, must be plugged in and retail for about $250,000.
Concerns, Obstacles
Dr. Spencer cautioned that ultrasound shouldn’t replace echocardiograms or other tools. “So no one is proposing that this would replace a full exam,” he says. “What we’re hoping is that this would detect things that have gone missing or would help ask very specific questions at the bedside.” His studies suggest the approach works well as long as the questions are simple: “Is there fluid or not? Is the heart good or bad?’ But not: ‘Is there an infection?’”
Beyond cardiology and the emergency room, Dr. Spencer says ultrasound has obvious imaging uses in the ICU. The dichotomy, he says, is that imaging intensive care patients can be especially difficult due to their edema, wounds, and lack of mobility. “That area has not blossomed as well as it could have,” he says.
Even so, the burgeoning number of applications for ultrasound “really has huge potential for good,” says Harvey Nisenbaum, MD, an associate professor of radiology at the University of Pennsylvania School of Medicine and president-elect of the American Institute of Ultrasound in Medicine (AIUM). “But the problem is that it’s an art form in the sense that it’s not automated.” No two ultrasound images will be identical, for example, because each depends upon the probe’s precise location. The key, Dr. Nisenbaum says, is proper training under agreed-upon guidelines, followed by continuing education and the maintenance of a hospitalist’s competency.
The AIUM, Nisenbaum says, is working to develop standard credentialing criteria for a range of ultrasound applications to help unify what has been a patchwork approach. Another limitation, he says, has been the lack of Food and Drug Administration (FDA) approval for ultrasound contrast agents Optison and Definity for noncardiac applications. Several deaths have been linked to the use of the intravenous agents in the sickest patients.
The institute is working with the FDA on trying to get the reagents approved for broader use, as they are in other countries. Nisenbaum cautioned the process likely will take a while. Once approved, getting a reimbursement code established for insurance purposes could take even longer.
A further obstacle, according to Dr. Spencer, is the lack of resolution surrounding medical legal issues. “Are we going to agree that this is like a physical examination?” he asks. “It’s unclear whether the medical legal community is going to accept that with ultrasound,” he says.
For cardiology applications, at least, he wonders if the push for reimbursement is such a good thing. “General internists are under incredible pressure [for billing],” he says. “They’re in a really tough spot, and so there would be enormous pressure to get reimbursed for every ultrasound.” As it is, he says, Medicare is targeting echocardiogram as an overutilized reimbursement item. “I hope the reason we’re using this is because we’re examining the patients anyway and this would allow us to find things that we might have missed,” he says. “It’s a better way of examining people, not a new technique for generating revenues. I think that would be a disaster.”
Jeffrey Wiese, MD, SHM board member and associate dean of graduate medical education at Tulane University School of Medicine’s Section of General Internal Medicine and Geriatrics in New Orleans, began putting ultrasound in the hands of his hospitalists and residents in 2007. It’s the “100% right thing to do,” he advises hospitalist groups. “It can be a meaningful way of improving safety. I hope that everyody would move that way.”
Dr. Wiese says residents began using ultrasound more and more for extra visualization during procedures.
“The reason we got into this was straightaway safety, independent of [Centers for Medicare and Medicaid Services] codes and billing—particularly regarding thoracentesis and internal lines,’’ he says. His hospitalists use SonaSite’s MicroMaxx system, “which was a key piece in the way of being able to bill. For all CMT just like endoscopy and bronchoscopy, you have to provide images of the procedure to prove you did it. With the MicroMaxx machine, it allows you to insert a USB and pull down images, take them to a print machine, print them out, and put them in a chart.”
Dr. Wiese touts the sheer amount of what hospitalists can use ultrasound for. “You can do echoes and abdominal ultrasound—not at the level of the radiology room or the cardiology lab, but you can get a quick look,” he says.
Should other hospitalist programs go in the same direction? “From a quality perspective there’s no question you go down that road,” Dr. Wiese asserts. “You do the math: How much does one pneumothorax cost? That’s especially true if [a] pneuothorax finds its way to CMS. One pneuomothorax that you prevent probably pays for your [$20,000-$30,000] machine. That’s even before you get into issues of billing for the use of it, which I think is a secondary way of funding the purchase.”
Forging Ahead
In the meantime, researchers are focusing on ever-diverse applications and smaller units.
At the Mayo Clinic in Jacksonville, Fla., director of regional anesthesia Steven Clendenen, MD, has pioneered the use of ultrasound for guiding nerve blocks.3 The imaging has “totally revolutionized” how the hospital manages pain, he says. As yet, the device still is cart-based, though he expects its size to shrink considerably. “You remember the first calculators, how big they were, and now look at them,” he says.
Beyond working toward miniaturized ultrasound units, Duke’s Smith has been developing real-time three-dimensional angiograms of blood vessels in the brain, a potential boon for stroke diagnoses.4 Another project may bring hospital-based ultrasound full circle: a device that produces a 3-D stereo-image, “like in the IMAX theater,” he says.5 Smith and his colleagues have modified a commercial scanner, “so the target comes out of the screen at you.” Among the many potential uses, expectant parents could see a 3-D stereo view of the developing fetus—something not even the iPhone can offer. TH
Bryn Nelson is a science journalist based in New York.
References
- Hind, D, Calvert, N, McWilliams, R, Davidson, A, Paisley, S, Beverley, C, Thomas, S. Ultrasonic locating devices for central venous cannulation: meta-analysis. Br Med J. 2003;327(7411):361.
- Fedson, S, Neithardt, G, Thomas, P, et al. Unsuspected clinically important findings detected with a small portable ultrasound device in patients admitted to a general medicine service. J Am Soc Echocardiogr. 2003;16(9):901-905.
- Feinglass NG, Clendenen SR, Torp KD, Wang RD, Castello R, Greengrass RA. Real-time three-dimensional ultrasound for continuous popliteal blockade: a case report and image description. Anesth Analg. 2007;105(1):272-274.
- Smith SW, Chu K, Idriss SF, Ivancevich NM, Light ED, Wolf PD. Feasibility Study: Real time 3D ultrasound imaging of the brain. Ultras Med Biol. 2004;30:1365-1371.
- Noble JR, Fronheiser MP, Smith SW. Real-time Stereo 3D Ultrasound. Ultrason Imaging. 2006;28:245-254.
The iPhone may be the latest “it” gadget, but a flurry of recent innovation has given portable ultrasound devices a healthy buzz within the biomedical community.
Beyond the gee-whiz factor, though, a growing number of studies demonstrate the everyday value of putting portable units in the hands of hospitalists.
“The big news has been the tiny portable scanner,” says Stephen Smith, a biomedical engineer at Duke University, in North Carolina, and a pioneer in ultrasound technology. Siemens recently introduced a hand-held device called the Acuson P10, which weighs 1.6 pounds, retails for $9,499 and can fit within a hospitalist’s coat pocket. Not to be outdone, GE has announced plans to introduce an ultrasound unit no bigger than an iPod.
Smith and his collaborators have taken the technology one step farther. They incorporate electrocardial leads on the unit’s transducer face to permit electrocardiograms and a microphone to let hospitalists use the ultrasound like a stethoscope.
Eric Isaacs, MD, a clinical professor of medicine at San Francisco General Hospital, says he routinely uses ultrasound for vascular access “to ensure the safety of procedures that we previously performed either blind or by anatomical landmarks.” Beyond improving the accuracy of placing central and peripheral lines, he says, “the reason we are using ultrasound more now is that the machine is so portable. The radiologists are no longer in the hospital 24 hours a day, and so by necessity we are using the tools that were previously only accessible from 9 to 5.”
Range of Uses
Among the reports recognizing ultrasound’s value, he cited a 2003 study in the British Medical Journal affirming the technology’s superiority to relying on physical landmarks in gaining central venous access, resulting in a lower technical failure rate, reduced complications, and faster access.1 Dr. Issacs says ultrasound also has helped guide procedures such as thorancentesis and paracentesis, other applications once confined to radiology. “It’s something that’s allowing me to do at the bedside what I would otherwise have to wait several hours for,” he says.
For heart patients, he says, a hospitalist can bring ultrasound to the bedside during a cardiac arrest to inspect cardiac motion and fluid, and monitor the patient’s hydration status by examining the size of the inferior vena cava. Internists likewise could examine the size of a patient’s aorta to look for signs of an aneurism, especially for a patient experiencing abdominal pain in the middle of the night. “Quite frankly, it seems like the only limit to ultrasound use is imagination,” Dr. Isaacs says.
Robert Rodriguez, MD, a clinical professor of medicine and emergency medicine at San Francisco General Hospital, says he uses ultrasound on 25% of the patients he sees on an in-patient basis. His biggest use, he says, is for placing central lines—though that could soon change.
“I work with a population that has a very high percentage of injection drug abuse, in whom it’s very difficult to find even a peripheral vein,” he says. At least once a day, he uses ultrasound to locate the brachial vein for such peripheral lines, circumventing the need for a central line through the subclavian vein and the risk of a pneumothorax. “In the past, we would have to put in a central line for just about anything,” he says. “And now we can put in a peripheral line that saves them the risk.”
Another benefit, he says, is in breeding better patient interactions—for example, with gallstones. “You can say to the patient: ‘This is the gallbladder, these are the stones in the gallbladder, this is what’s causing the pain,’” he says. “I think patients appreciate being able to see that firsthand. I think they also appreciate that it’s going to lessen their likelihood of having a complication.”
At the University of Chicago Medical Center, cardiologist Kirk Spencer, MD, says ultrasound procedures still are performed mainly by sonographers and cardiologists. He hopes to change that with a slew of studies demonstrating the feasibility of putting portable ultrasound in the hands of internists.
In one study, hospitalized patients indicated for echocardiography received an echocardiogram, while all others were examined with ultrasound. “We found a significant number of cardio pathologies,” Dr. Spencer says. The findings, he says, were independent of specific medical complaints, such as endocrinology or orthopedic problems.2 “If you were sick enough to get in the hospital, there was a chance that you had a significant cardiac problem that needed to be addressed,” he says.
The study that most excites Dr. Spencer was presented at the 2007 IEEE International Ultrasonics Symposium in October.2 It looked at using ultrasound before releasing a cardiac patient. “One of the biggest problems, one of the most common diagnoses is congestive heart failure,” he says, with a six-month readmission rate of 30% to 40%. Giving ultrasound devices to internists allowed them to look at the amount of fluid around the heart of each cardiac patient.
“The patients who got readmitted all had more fluid detected by ultrasound,” Dr. Spencer says. “So we can do that and say, ‘Hey, you need to stay in the hospital two more days. But if that prevents you from coming back in six months, then that’s a good thing.’”
In patients diagnosed with congestive heart failure, he and his collaborators found, the mean fluid volume was higher for those who were later readmitted. Dr. Spencer plans to pick a reasonable cut-off value and prospectively test whether delaying the release of patients whose fluid levels exceed that value can cut readmission rates.
Most of the battery-operated units used by the medical center weigh between 6 to 10 pounds and cost between $12,000 and $20,000, he says. The devices, about twice the thickness of an iBook, can easily be carried on a shoulder strap. Echocardiogram machines, by contrast, weigh about 300 pounds, must be plugged in and retail for about $250,000.
Concerns, Obstacles
Dr. Spencer cautioned that ultrasound shouldn’t replace echocardiograms or other tools. “So no one is proposing that this would replace a full exam,” he says. “What we’re hoping is that this would detect things that have gone missing or would help ask very specific questions at the bedside.” His studies suggest the approach works well as long as the questions are simple: “Is there fluid or not? Is the heart good or bad?’ But not: ‘Is there an infection?’”
Beyond cardiology and the emergency room, Dr. Spencer says ultrasound has obvious imaging uses in the ICU. The dichotomy, he says, is that imaging intensive care patients can be especially difficult due to their edema, wounds, and lack of mobility. “That area has not blossomed as well as it could have,” he says.
Even so, the burgeoning number of applications for ultrasound “really has huge potential for good,” says Harvey Nisenbaum, MD, an associate professor of radiology at the University of Pennsylvania School of Medicine and president-elect of the American Institute of Ultrasound in Medicine (AIUM). “But the problem is that it’s an art form in the sense that it’s not automated.” No two ultrasound images will be identical, for example, because each depends upon the probe’s precise location. The key, Dr. Nisenbaum says, is proper training under agreed-upon guidelines, followed by continuing education and the maintenance of a hospitalist’s competency.
The AIUM, Nisenbaum says, is working to develop standard credentialing criteria for a range of ultrasound applications to help unify what has been a patchwork approach. Another limitation, he says, has been the lack of Food and Drug Administration (FDA) approval for ultrasound contrast agents Optison and Definity for noncardiac applications. Several deaths have been linked to the use of the intravenous agents in the sickest patients.
The institute is working with the FDA on trying to get the reagents approved for broader use, as they are in other countries. Nisenbaum cautioned the process likely will take a while. Once approved, getting a reimbursement code established for insurance purposes could take even longer.
A further obstacle, according to Dr. Spencer, is the lack of resolution surrounding medical legal issues. “Are we going to agree that this is like a physical examination?” he asks. “It’s unclear whether the medical legal community is going to accept that with ultrasound,” he says.
For cardiology applications, at least, he wonders if the push for reimbursement is such a good thing. “General internists are under incredible pressure [for billing],” he says. “They’re in a really tough spot, and so there would be enormous pressure to get reimbursed for every ultrasound.” As it is, he says, Medicare is targeting echocardiogram as an overutilized reimbursement item. “I hope the reason we’re using this is because we’re examining the patients anyway and this would allow us to find things that we might have missed,” he says. “It’s a better way of examining people, not a new technique for generating revenues. I think that would be a disaster.”
Jeffrey Wiese, MD, SHM board member and associate dean of graduate medical education at Tulane University School of Medicine’s Section of General Internal Medicine and Geriatrics in New Orleans, began putting ultrasound in the hands of his hospitalists and residents in 2007. It’s the “100% right thing to do,” he advises hospitalist groups. “It can be a meaningful way of improving safety. I hope that everyody would move that way.”
Dr. Wiese says residents began using ultrasound more and more for extra visualization during procedures.
“The reason we got into this was straightaway safety, independent of [Centers for Medicare and Medicaid Services] codes and billing—particularly regarding thoracentesis and internal lines,’’ he says. His hospitalists use SonaSite’s MicroMaxx system, “which was a key piece in the way of being able to bill. For all CMT just like endoscopy and bronchoscopy, you have to provide images of the procedure to prove you did it. With the MicroMaxx machine, it allows you to insert a USB and pull down images, take them to a print machine, print them out, and put them in a chart.”
Dr. Wiese touts the sheer amount of what hospitalists can use ultrasound for. “You can do echoes and abdominal ultrasound—not at the level of the radiology room or the cardiology lab, but you can get a quick look,” he says.
Should other hospitalist programs go in the same direction? “From a quality perspective there’s no question you go down that road,” Dr. Wiese asserts. “You do the math: How much does one pneumothorax cost? That’s especially true if [a] pneuothorax finds its way to CMS. One pneuomothorax that you prevent probably pays for your [$20,000-$30,000] machine. That’s even before you get into issues of billing for the use of it, which I think is a secondary way of funding the purchase.”
Forging Ahead
In the meantime, researchers are focusing on ever-diverse applications and smaller units.
At the Mayo Clinic in Jacksonville, Fla., director of regional anesthesia Steven Clendenen, MD, has pioneered the use of ultrasound for guiding nerve blocks.3 The imaging has “totally revolutionized” how the hospital manages pain, he says. As yet, the device still is cart-based, though he expects its size to shrink considerably. “You remember the first calculators, how big they were, and now look at them,” he says.
Beyond working toward miniaturized ultrasound units, Duke’s Smith has been developing real-time three-dimensional angiograms of blood vessels in the brain, a potential boon for stroke diagnoses.4 Another project may bring hospital-based ultrasound full circle: a device that produces a 3-D stereo-image, “like in the IMAX theater,” he says.5 Smith and his colleagues have modified a commercial scanner, “so the target comes out of the screen at you.” Among the many potential uses, expectant parents could see a 3-D stereo view of the developing fetus—something not even the iPhone can offer. TH
Bryn Nelson is a science journalist based in New York.
References
- Hind, D, Calvert, N, McWilliams, R, Davidson, A, Paisley, S, Beverley, C, Thomas, S. Ultrasonic locating devices for central venous cannulation: meta-analysis. Br Med J. 2003;327(7411):361.
- Fedson, S, Neithardt, G, Thomas, P, et al. Unsuspected clinically important findings detected with a small portable ultrasound device in patients admitted to a general medicine service. J Am Soc Echocardiogr. 2003;16(9):901-905.
- Feinglass NG, Clendenen SR, Torp KD, Wang RD, Castello R, Greengrass RA. Real-time three-dimensional ultrasound for continuous popliteal blockade: a case report and image description. Anesth Analg. 2007;105(1):272-274.
- Smith SW, Chu K, Idriss SF, Ivancevich NM, Light ED, Wolf PD. Feasibility Study: Real time 3D ultrasound imaging of the brain. Ultras Med Biol. 2004;30:1365-1371.
- Noble JR, Fronheiser MP, Smith SW. Real-time Stereo 3D Ultrasound. Ultrason Imaging. 2006;28:245-254.