The massive increase in procedures over the past 20 years has added to the cost of providing care, to no one’s surprise. A study in the recent Radiology journal acknowledges this.

Part of the explosion in medical imaging over the past two decades may be attributable to overutilization, and steps need to be taken to cut back … Imaging services and their costs have grown at about twice the rate of other technologies in healthcare including lab procedures and pharmaceuticals…

Part of the problem fueling this growth has been the inclusion of many non-invasive standard imaging techniques as being procedure based — lumping the costs associated with uncomplicated, unenhanced CT imaging with, say, CT-guided renal biopsy — for example. Of course, bordering on the unethical side are the practices of self-referral within large imaging groups in many healthcare markets. | LINK

The application of the philosophy that is at the core of medicine: first do no harm — is a little at play in an article in the NYT. The rise of so-called concierge practices in the wake of healthcare reform has touched off a debate of sorts on the ethics of delivering such care. That is, you essentially pay for what you get — nothing more, nothing less. Perhaps its the myriad names by which its central workings are known that give it some ethical cover: membership medicine, concierge health care, cash only practice, direct care, boutique medicine. These terms convey one basic fact — the patient pays an annual fee (with other possible charges). In exchange for the retainer, doctors provide enhanced care.

[I]t’s hard not to wonder whether it is possible to practice in a way that reconciles concierge medicine with all the ethical concerns. One group of doctors in Boston believes it is possible. [...] But unlike other boutique practices, the retainer fee of $1,800 per year that these patients pay does not go directly to the doctors’ coffers. Instead, it is used to support the traditional general medical practice, the teaching of medical students and trainees and free care to impoverished patients.

Thinking of the delivery of this type of “specialized” primary care in which fees go to the process of delivery itself before direct provider revenue is another way some primary care practices hope to regain some lost footing in practices on the brink of dissolution or acquisition under the brave new world of reform. For some of these practices, for now, arrangements seem to be paying off — ethically, if not fiscally. | LINK

The retooled GAMC health plan initiated due to the budget crisis in this state earlier this year appears to be at a crossroads of sorts — and it involves payments to the participating safety-net hospitals.

The discussions began because Hennepin County Medical Center (HCMC) in Minneapolis has had a smaller percentage of potential patients enroll than the other three participating hospitals and, as a result, is getting paid more than twice the amount per patient.

The capitated-type payments to the hospitals which have the resources to participate in the GAMC overhaul was introduced as a way to complement patient enrollment caps to each of those participating hospitals. However, it appears that there is a breakdown in access-to-care and cost-per-patient parity, with HCMC getting the lions’ share of patients outside of the scope of its available general assistance medical funds. | LINK

Illinois will offer this week the first-in-the-nation coverage plan for its uninsured since health reform was enacted. Currently, the state has almost 2 million uninsured by estimates. The plan to place them on coverage rolls will not reach them all — only a fraction, actually. Illinois’ Pre-existing Condition Insurance Plan can only enroll enough in its high risk pool because of federal funding limitations.^[1]

The creation of high-risk insurance pools under reform is one way over the next 4 years President Obama has said he will rein in coverage costs by mimicking enrollment/disenrollment policies of states; creating service areas of operation with HHS guidance; issuing creditable appeals processes for enrollees; preventing employers from creating disincentives for employee enrollment in those pools; and utilizing accountability rules to prevent fraud.

Illinois is the first state to test the waters in this transition to healthcare exchanges set to begin in 2014. | LINK

1. Funding comes from premiums and from the federal government, which is giving the state $196 million to run the plan until 2014 when healthcare exchanges will be required under the 2010 Affordable Care Act. [↩]

The state of Massachusetts has reached a deal with the fifth of six insurers initially denied rate hikes for coverage in that state. While nowhere near the massive increases sought in other high-profile states, Massachusetts’ most recent settlement involved a company’s requests for hikes in the 10% to 25% range for policyholders. Over 90% of coverage in Mass. has been positively affected by settlement negotiations with those five insurers which includes the individual market and small-business purchasers. The process of rate hike negotiations is just another factor in the long history of closely observed operations in a state which guarantees coverage to all of its citizens. | LINK

Healthcare reform begets the need for laws to ensure the intent of reform. This has never been truer than on the eve of implementation of the major role individual states’ insurance commissions in keeping Insurance accountable. As coverage begins to expand to include demographics never before considered by insurers, many states have no mechanism to face enforcements of the central tenets of the reform law. Most outstanding, states will now have the ability to review insurance premium hikes, for example — the number one stealth maneuver of insurers of late to guarantee profitability.

If states are not able to carry out insurance compliance in accordance with with reform law, the feds step in to guarantee standards. Problem is, as intricate as the central aspects of reform are, the provisions in many states’ laws are just as myriad.

Some state regulators said they would ask state legislators to expand their authority by putting the federal standards into state law next year. Others said they would rely on their powers of persuasion, the good will of insurers or general state laws that ban unfair or deceptive trade practices.

Despite assurances to states by the federal government that, ultimately, such oversight is well within their scope, gaps in executive powers vary widely; these inconsistencies place yet another wrinkle on the rapid rollout of reform provisions the Obama administration hopes will result in a smooth transition between the parties that will continue to drive healthcare in this country (insurers) and the ultimate functional unit of healthcare commerce (the physician-patient partnership). | LINK

The underlying tenet of heatlhcare reform in this country is access. Achieving that access is a means to an end that separates reform’s political ideology essentially down partisan lines. The ongoing Medicaid saga and its “role” via the states is thorn in the current administration’s side as reform gets underway. With some jurisdictions embracing federal matching funds upfront to finance care in the near term, others are downright hostile to enter in to a commitment when individual states’ financial outlooks are so shaky.

A new study highlights the reality facing states whose budgets are so tenuous (in this case, California), the conflicting scenario between guaranteed healthcare access and the depletion of funds to finance it generally leads to one conclusion: no matter what state governments do to cut spending in one healthcare sector, costs seem to go up in another — sometimes at a far greater rate.

Increasing numbers of Americans, especially adults on Medicaid, are using hospital emergency rooms for their health care, say researchers from the University of California, San Francisco. [..]

The findings suggest that access to primary care is a key problem, Tang [the researcher/author] said. “Whether it’s primary care physicians are not accepting new patients with Medicaid or that there aren’t enough primary care physicians, we need to dig a little bit deeper,” she said.

More spending the answer? Seems really audacious at this point to even ask that question, let alone think it. | LINK

Critics of President Obama’s rosy outlook on Medicare reform as part of the Affordable Care Act are pointing to the entitlement’s chief actuary as proof that his sudden realization of Medicare’s fiscal virtues under reform are peppered with politics. As recently as last weekend, Obama praised the almost half a trillion in savings over the next decade to the federal budget as not only the most fiscally responsible action the government has implemented as part of reform, but also as part and parcel of the overall commitment to the nation’s seniors with respect to the affordable access to healthcare.

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Two thousand ten just may go down as the year that Medicare is finally getting the recognition it deserves. Well, perhaps in a half-perverse way, anyway. The government entitlement program, which has just celebrated 45 years as the godfather of all payers in healthcare, continues to gain ink in an otherwise unrelated news cycle. President Obama appears to be taking credit for saving the program’s solvency singlehandedly, as his vision of healthcare reform would be far less vital without a provision to forming a leaner, meaner CMS.

In his weekly address to the American people, Obama reiterated his commitment to a program that is more “secure” than ever, a “commitment to America’s seniors” — never wavering from that core point. Obama will likely continue that same tenor as he campaigns for (some of the more vulnerable) Democrats in this year’s midterms, highlighting Medicare’s fiscal leanness with such tenacity, that to acknowledge that the country is still mired in a recession flirting with across-the-board double digit unemployment and ever-spiraling jobless claims is completely tangential.

At this stage, it is not clear how this gambit of Obama’s will play out in November, especially when wide swaths of the general population demographic — not just seniors — need the reassurance he continues to express on health reform as generalizable and essential to economic recovery in this country. All the while, the GOP will continue to hold up Obama’s enthusiasm for government’s role in Medicare as reason that 16% of this country’s GDP is one of the prime causes of the current economic disarray.

BC/BS Michigan is asking that state’s insurance regulators to vary the premium amounts on its Medigap supplemental offerings to seniors. It will ask state regulators to allow deeper discounts to low-income seniors while reducing the discounts on premiums for wealthier seniors. Medigap plans are standard insurance supplements to Medicare coverage offered only to beneficiaries with both Part A and B coverage.

Plans offered usually are the same; only the premiums can differ. All Michigan Blue Cross customers for the most popular of its Medigap policies now get a 39 percent discount off monthly premiums. The discount is distributed evenly to all Medigap policyholders, so that everyone pays just over $100.

It appears that with this move, the Michigan insurance marketplace is one of the first arenas in which states will negotiate with payers in the wake of expected cuts under Medicare Advantage offerings to fund reform over the next decade. | LINK

The Obama administration can take solace in some favorable news to become official later this week, as the annual Medicare and Social Security trustees report detailing the entitlement programs’ fiscal health becomes public. The report says that the budget will realize approximately $8B in savings at the dawn of reform, with a trajectory of almost a half a trillion in overall savings by the end of the 2010s.

Although not considered a particularly incendiary demographic with respect to Obama’s reform goals, the nation’s senior citizens have expressed concern over the solvency of Medicare over the next decade. It is safe to assume that the administration will use this news as a talking point to assuage those fears — in addition to running ads like this as a surrogate method.

Critics of the Obama admin’s plan to trim Medicare and Medicaid costs are quick to point out the presumed diversion of those implied savings into subsidies for the uninsured over the next decade — a move, they say, does nothing to retain solvency into the 2020s or save on healthcare costs in the long term. | LINK to report [PDF]

Health care coordination seems to the mechanism by which many healthcare pundits on either side of the the debate agree on how significant waste in spending can be cut. North Carolina’s Medicaid program is utilizing the medical home model as an example of that type of care coordination.

Moving beyond Medicaid FFS and traditional managed care partnerships, the delivery of care in this context identifies the appropriate patient populations based upon services meeting certain primary care needs. Physicians are paid higher reimbursements and a specialized “care-coordination” fee as incentive to continue participation. Community care networks made up of primary care teams in multiple locations serving Medicaid enrollees are headed by physicians and serve as the de facto health plan for those patients.

This model is another example of putting state healthcare spending to practical use, empowering physicians who manage it not only to have a stake in its success but also to remain intimately involved in quality healthcare delivery at the state level. | LINK

Those who expected the state with the first-in-the-nation initiative to cover the health care of all of its citizenry will have to hold their collective breaths a little longer. The plans for an overhaul on how physicians and hospitals are paid for quality delivery are on hold as major parties cannot come to an agreement on how this metric should be implemented. Perhaps the thought of examining Massachusetts’ negotiated payment system as a relatively straightforward exercise in healthcare economics was a bit shortsighted.

Combine the complexities of fee-for-service government reimbursements with the intricacies of funding for coordinated care systems; the possibilities of funding an accountable care commission of sorts as a payment governing body; and the simple inertia that current levels of healthcare spending have created in a wasteful state system — and you’ve got a recipe for an overwhelming stalemate. There is a glimmer of hope that one faction’s action will get the legislative ball rolling on this issue: some hospital systems in the state plan to release details on the creation of governance to oversee spending in their ranks. | LINK