Delivery of Care

Warning: reading this story may prove disruptive to your health

Do not read this. Do not share this. Do not post this story on social media. Do not talk about it at the dinner table. Doing so may upset the status quo of health care in Rhode Island.

Photo by Richard Asinof

Marie Ganim, R.I. Health Insurance Commissioner, speaking at the signing of an executive order by Gov. Gina Raimondo to establish an annual 3.2 percent cap on on health care spending growth in Rhode Island.

By Richard Asinof
Posted 2/18/19
The willingness of the private health industry sector and government regulators in Rhode Island to agree to an annual growth cap on health care spending is a sea change in health care policy. Big questions remain, however, such as whether the exigencies of public health crises caused by climate change will swamp such a cap.
How much investment is being made in prevention vs. clinical intervention when it comes to chronic diseases such as asthma, which is a leading cause of school absenteeism and student underachievement? Has anyone in Rhode Island – at Brown, at URI, at RIC, at Bryant – created an economic projection of the costs of public health interventions around the increase in diseases spread by changing vectors as a result of climate change? What are the specific costs related to additional health IT build out required by the adoption of accountable entities by Medicaid managed care insurers and provided? How will the new statewide plan for health reflect the changing business model for health care, where physician group practices unaffiliated with hospitals are emerging? How would investment in recovery housing for mothers with children decrease future health care costs? Does there need to be a greater focus on the needs of the under-insured and the uninsured populations in Rhode Island?
The innovation ecosystem as defined by the biotech industry community is preparing to ramp up its activities in Rhode Island, with the formation of the RI BioHub, the evolution of MedMates in RI Bio, as part of a regional partnership, and the planned opening of the Wexford Innovation Complex later this year. How that converges with the confluence of innovation within the health care delivery sector remains an open question; the efforts appear to be following separate, parallel pathways, particularly around the changing business model for health care delivery.

PROVIDENCE – In the aftermath of Valentines Day, one of the more clever uses of social media that emerged were the ditties for Valentines composed around health care policy, which seemed to capture the basic truths around the delivery of health care services much better than any brochure or TV ad or billboard could do.

Take, for instance, the tweet by Megan Foster Friedman, who wrote on Tuesday, Feb. 12: When the moon hits your eye like a big pizza pie that’s S05.91XA [unspecified injury of right eye and orbit, initial encounter] #healthpolicyvalentines

To which Gabriel Rice, MD, replied: “Unspecified will not be accepted as a billable diagnosis, sorry.”

That tweet exchange, in a nutshell, defines much of what happens in the delivery of health care services today: to everything there is a code, turn turn turn, in order to get paid through health insurance, be it commercial or self-insured through a job, Medicare or Medicaid.

Unrequited bills

Of course, deciphering what the code’s relationship is to the actual cost can prove to be a complicated task. Vox’s Sarah Kliff has spent the past year collecting thousands of emergency room bills, trying to analyze them and then connecting the services allegedly provided to the actual costs itemized on the bill.

Many of Kliff’s stories have made front-page news, resulting in dramatic reductions in ER bills, as health systems were publicly shamed into reducing “excessive” bills.

Overwhelmed by the response from patients who were willing to share their ER bills, believing they might have been bamboozled, Kliff and her team have now enlisted local health reporters to join the fray.

“We’ve spent the past year collecting thousands of ER bills. I’ve written about a few,” Kliff tweeted. “But there are plenty more. We want to share them with other health reporters [particularly local folks]. Is that you?”

[ConvergenceRI has sent in a request, expressing a willingness to investigate an ER bill from Rhode Island. Stay tuned.]

In turn, Kliff was still asking patients to send her more ER bills. She tweeted: “We have 1,999 in our ER database. Submit our 2,000th bill and you will be my #healthpolicyvalentines

The hungry tapeworm
The connection between codes, costs, patients and billing often occurs in the ethereal world of health IT: the relationship between patient, provider and payer as defined by what is recorded and tracked on health IT systems.

Much of the trillions of dollars to support the adoption of health IT and electronic health records actually flowed from the federal government in what Carl Dvorak, president of the Epic Systems Corporation, described as a major public works project.

“This was our [21st century] version of the Tennessee Valley Authority,” Dvorak said, in a talk at the Alpert Medical School at Brown in January of 2018. “They [the government] didn’t care if it worked; it just had to have reasonable expectation that it would work,” in order to help keep the economy afloat in the aftermath of the Great Recession.” [See link below to ConvergenceRI story, “Is health care all about the data, the data, the data?”]

Epic, a privately held firm headquartered in Verona, Wisconsin, is the purveyor of one of the largest electronic health record systems in the world, with a market share of approximately 26 percent for all acute care hospitals in the U.S., according to 2016 data. Worldwide, Epic is said to have some 190 million patient records flowing through its data systems.

To reduce medical costs, health IT has become the tool of choice to create algorithms to better manage population health, using Big Data as a predictive tool. And, in the growing world of accountable entities and accountable care organizations, population health management analytics have become the go-to script to measure outcomes and reduce costs, placing the risk on providers to perform in order to share in any promised savings.

Indeed, it has been a little more than a year since Amazon, JPMorgan Chase and Berkshire Hathaway announced on Jan. 29, 2018, that they were planning a new joint nonprofit venture to tackle “the hungry tapeworm” that is the cost of health care eating away at corporate revenues [and, for everyone else, much of their household income].

Dr. Atul Gawande was chosen to serve as the CEO of the new disruptive enterprise being planned by Warren Buffett, Jeff Bezos of Amazon and Jamie Dimon of JPMorgan Chase, which still does not have a name. Without explanation, Gawande pulled out of giving the keynote speech at the Health Information and Management Systems Society held last week in Orlando, Fla.

Collateral damage
Physicians, in turn, have become tethered to the 21st century stethoscope, electronic health records, resulting in rising rates of stress and burnout, according to a recent study, co-authored by Dr. Rebekah L. Gardner, “Physician stress and burnout: the impact of health information technology,” which was published in the Dec. 5, 2018, edition of the Journal of the American Medical Informatics Association. [See link below to ConverenceRI study below, “Stress, burnout and endless inbox messaging, oh my.”]

The study, drawn from results from a 2017 health information technology survey conducted of some 4,200 practicing physicians in Rhode Island, asked several questions about burnout and stress from the use of EHRs.

About half of the physicians who responded reported “insufficient time for documentation,” according to the study. Prevalence of stress was found to be highest among physicians in the traditional primary care specialties: general internal medicine, family medicine, and pediatrics.

Further, the study posited that such time pressure “poses a direct challenge to connecting with patients, one of the more sustaining aspects of primary care practice.” Another factor the study mentioned was that documentation time was generally not reimbursed.

Translated, “Physicians may feel that they are spending a large portion of their time on complex and time-consuming work that does not benefit their patients,” according to the study.

What gets measured, gets paid
Consider this a lengthy preamble to further exploration of a story covered by ConvergenceRI in last week’s edition: the executive order signed on Feb. 6 by Gov. Gina Raimondo, establishing a voluntary cap of 3.2 percent on the growth of the annual health care spend in Rhode Island. [See link below to ConvergenceRI story, “Annual cap of 3.2 percent put on health care costs in RI.”]

Let us begin at the beginning: we hold these truths to be self-evident. All health care is personal; all health care is complex; all health care is political – the axiom of who gets what, how much, and when. The dividing line for access to health care is often defined by wealth: those who have to stand in line vs. those who go to the front of the line.

Was there a deeper context to the story?
After 10 years of numerous commissions, often marked by acrimonious debates, many of which were reported on by ConvergenceRI, the private health care industry sector and government regulators in Rhode Island have agreed to put a voluntary cap on annual health care spending growth. Why was that? Was it because of the enlightened leadership of the Governor and the health care industry? Or, was it a response to the threat posed by the groundswell of support for an all-payer health care system, offered referred to as Medicare for All?

How was this effort connected to efforts to establish a new statewide health plan document? Such a document is now under discussion by a group led by Rhode Island Foundation President and CEO Neil Steinberg. Would such a document establish a protocol for determining how many hospital beds are needed in Rhode Island? How would such a document reflect the changing business model for health care, driven by physician groups, not necessarily by hospitals? Will patients and communities become part of the decision-making process? Or will the process to develop a statewide health plan be controlled by business community titans? How will the current work by the R.I. Department of Health around health equity zones be incorporated into the planning document?

• How will the new compact change the dynamics in the current debate around health care, at least in Rhode Island, which is really a debate about the role of government regulation vs. the rights of the private industry sector? The nation has spent much of the last decade arguing about the success or failure of the Affordable Care Act, also known as Obamacare, with the kind of ideological fervor that once led Catholics and Protestants to slaughter each other in Europe during the 1500s as a way of proving devotion to God.

The fulcrum balancing the differential between health costs and quality of health outcomes always seems to get caught up in trying to answer big questions: Is health care a right or a privilege? Is the expansion of Medicaid a sign of economic strength or economic weakness? Do women have the right to control their own personal health care decisions? Should the government use its leverage to negotiate better drug prices? And, is the current health care delivery system really a system, or rather, a market that practices wealth extraction?

For many, the answers may seem obvious. These are big issues, worthy of dinner-table conversations, or even a segment on "A Lively Experiment." But, for the moment, let’s keep the focus here in Rhode Island.

Follow up questions
ConvergenceRI asked a number of follow-up questions to Marie Ganim, the R.I. Health Insurance Commissioner, attempting to better understand the formula for calculating for annual growth in health care “spend.” Cory King, principal policy associate at the R.I. Office of the Health Insurance Commissioner, responded promptly. Here are the questions and answers:

ConvergenceRI: Is there a copy of the formula being used to calculate health care spend that you could share? If not, why not?
We are still in the process of developing a technical manual for collecting and calculating the various data inputs. With that said, we have selected the populations and relevant categories of spending that will be included in the calculation.

As stated in the Cost Growth Target Compact: “The cost growth target will be used to assess health care cost growth for all Rhode Island residents who have commercial [insured and self-insured], Medicaid, and Medicare coverage. Performance assessment relative to the target will include consideration of claims spending, non-claims-based spending, pharmacy rebates, consumer cost sharing and insurer administrative costs and margins.”

We have studied Massachusetts’ approach to measurement and we expect the manual to be completed in the coming months. We will also gain important insights into the best methods of using the APCD [All-Payer Claims Database] data for these purposes from the analysis that Brown is currently undertaking.

ConvergenceRI: I am particularly interested in how “contingency expenses” are being calculated for the next four years. For instance, are there any projections about costs from public health disease threats to Rhode Island based upon climate change that are included the projections of contingency costs?

To be specific, are there any financial calculations that look at the costs as a result of the increase in vector-borne diseases in Rhode Island, such as Zika, Dengue, Chikungunya, and Lyme, among others. If not, why not?

Also, are there any calculations of contingencies regarding widespread outbreaks of flu in Rhode Island as a result of a potential pandemic?
We did not project potential costs related to public health disease threats from climate change, or potential flu pandemics. However, should significant epidemiological events adversely impact provider/insurer performance relative to the 3.2 percent target, such epidemiological shocks would contextualize the cost performance we observe, and public reporting on costs would attempt to reflect this. Public health costs that occur outside of billing or provider payment would be outside of the scope of measurement.

ConvergenceRI: A third question regards how administrative costs are calculated as part of the equation. Under the formula, are administrative costs compared as a percentage of other expenses, and then compared against other institutions’ administrative expenses? What I would be looking at is how salaries for the executive leadership team factor are analyzed, if at all, in terms of capping health cost growth.
Our methodology will focus on how much money providers are being paid. How these payments are allocated across provider costs is outside the scope of this work at the moment. We will, however, include insurer administrative costs as a specific component of the measurement methodology. Another forum to examine insurer administrative cost is the annual rate review process.

ConvergenceRI: Another factor I am interested in is spending on health IT. Is that part of the equation, or is that considered an externality and not part of the formula? To drill down more specifically, in the development of new accountable entities under the Reinvention of Medicaid, the new benchmarks to be measured and analyzed under accountable entities will require more "sophisticated" health IT build-outs, both at the insurance level and at the provider level. How are those costs factored into the formula for calculating annual growth in health care costs? Or, are they being ignored?
Health IT costs are financed through insurer premiums and provider payments, depending on where the infrastructure is being developed. Our methodology for measuring health care costs will capture total payments, but we will not specifically examine health IT costs.

ConvergenceRI: Finally, I was wondering if there was a consistent definition being used as part of this exercise around what is “population health management.”
I think in general the way insurers and providers use the phrase “population health management,” they are referring to efforts undertaken to manage patient populations using care management, data, and a focus on preventive screenings and immunizations.

The social determinants of health also enter the mix given their relevance to overall health. With respect to the insurer and provider perspective, their focus is on the populations for whom they are accountable, either through membership in a health plan or attribution to a provider entity.

Of course, one can take a broader perspective on “population health management” to include neighborhoods, communities, or the state at large.

This broader perspective coheres with the work being done by some of the health centers [think Blackstone Valley], the Health Equity Zones, and the R.I. Department of Health. Each of these entities has distinct tools and perspective.

Editor's note: The New York Times published a fascinating article last week about how the leaders of the insurance, pharmacy and medical industry have aligned themselves to discredit efforts to create a public, single-payer health plan, sometimes referred to as Medicare for All. See the link below to the story, "Health Care and insurance industries mobilize to kill Medicare for All."


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