Support for National Health Insurance Seven Years Into Massachusetts Healthcare Reform: Views of Populations Targeted by the Reform

By Sonali Saluja, Leah Zallman, Rachel Nardin, David Bor, Steffie Woolhandler, David U. Himmelstein, and Danny McCormick
International Journal of Health Services, OnlineFirst – November 3, 2015

Abstract

Before the Affordable Care Act (ACA), many surveys showed majority support for national health insurance (NHI), also known as single payer; however, little is currently known about views of the ACA’s targeted population. Massachusetts residents have had seven years of experience with state health care reform that became the model for the ACA. We surveyed 1,151 adults visiting safety-net emergency departments in Massachusetts in late 2013 on their preference for NHI or the Massachusetts reform and on their experiences with insurance. Most of the patients surveyed were low-income and non-white. The majority of patients (72.0%) preferred NHI to the Massachusetts reform. Support for NHI among those with public insurance, commercial insurance, and no insurance was 68.9%, 70.3%, and 86.3%, respectively (p < .001). Support for NHI was higher among patients dissatisfied with their insurance plan (83.3% vs. 68.9%, p 1⁄4 .014), who delayed medical care (81.2% vs. 69.6%, p<.001) or avoided purchasing medications due to cost (87.3% vs. 71.4%; p1⁄4.01). Majority support for NHI was observed in every demographic subgroup. Given the strong support for NHI among disadvantaged Massachusetts patients seven years after state health reform, a reappraisal of the ACA’s ability to meet the needs of underserved patients is warranted.

From the Methods

The survey included questions about demographics, health status, knowledge about health insurance, and experiences obtaining and using insurance. One question assessed patients’ preferences regarding reform of the health care system. This question, adapted from a prior Washington Post-ABC News poll question, asked patients to choose one of two health care systems: “the current Massachusetts system — which includes a mixture of insurance types, requires that most people pay copays and premiums and mandates that people obtain coverage — or a single national health insurance program — which would be run by the government, paid for by taxes, cover all residents, and not require co-pays or premiums.”

From the Discussion

Our study is the first to directly compare preferences for the MA health reform to NHI. Our findings are not intended to be generalizable to all residents of MA, most of whom are affluent, white, and commercially insured. Our purpose was not to gauge statewide support for NHI, but instead to understand such support in the key policy-relevant populations of patients who were the main target of the health reform — MA residents who are socioeconomically disadvantaged and racial and ethnic minorities.

NHI has been proposed for many years; however, this option is often regarded as unrealistic because it lacks support of key stakeholders, especially the pharmaceutical and insurance industries. Yet, our results suggest a disconnect between the health care financing system that exists in MA (and now nationally) and the system underserved patients prefer.

http://joh.sagepub.com/content/early/2015/10/30/0020731415615314.abstract

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Comment:

By Don McCanne, M.D.

Many polls and surveys have shown that the majority of United States residents would prefer a single payer national health program. This survey is an important addition since it shows that individuals specifically targeted by reform in Massachusetts – individuals who theoretically would be satisfied with the system if reform met their needs – would still prefer to have a single national health insurance program.

Since the reform design of the Affordable Care Act (ACA) was based on the reforms in Massachusetts, it would be safe to say that the response nationally to ACA reforms would be quite similar. So reforms were not adequate for the population they were primarily designed to serve, nor were they adequate for the majority of us who believe that health care should be accessible and affordable for all. ACA falls short of those goals, whereas single payer would meet them. We should go for it.

Obamacare Not as Egalitarian as It Appears

By Tyler Cowen
The New York Times, November 6, 2015

The Affordable Care Act has generated an enormous amount of partisan rancor, but with more access to data, it is worth taking stock of how it has actually been working.

We can safely say that the policy is costing less than anticipated, perhaps 20 percent less, according to a Congressional Budget Office estimate, and that it has reduced the number of Americans without insurance. But the numbers also suggest that by some measures, the Affordable Care Act has had only a limited impact on economic inequality. In fact, I view the policy as an object lesson in the complexity of reducing the harmful consequences of inequality in the United States.

The act has many parts, but let’s focus on the mandate, a core feature that requires those without insurance to buy it. It was intended to help millions of Americans who did not have health care coverage. Under the program, government subsidies are available for the needy, and there is clear evidence that the poorest people, who receive the largest subsidies, are better off under the health reform law.

In that sense, the program has been a success. But whether other individuals subject to the insurance mandate — those who qualify for lower subsidies or for none at all — are also better off is much harder to say, some recent research has found.

Of course, this question may seem simple if you consider health care coverage to be an essential component of a good human life, and perhaps of social justice as well. If you begin with those assumptions, you might conclude that when you require people to buy insurance coverage you are improving their lives — even if they are not willing to pay for the insurance without prompting from the government.

But there is another way of looking at it, one used in traditional economics, which focuses on how much people are willing to pay as an indication of their real preferences. Using this measure, if everyone covered by the insurance mandate were to buy health insurance as the law dictated, more than half of them would be worse off.

This may seem startling. But in an economic study, researchers measured such preferences by looking at data known as market demand curves. Practically speaking, these demand curves implied that individuals would rather take some risk with their health — and spend their money on other things — partly because they knew that even without insurance they still would receive some health care.

One implication is that the preferences of many people subject to the insurance mandate are likely to become more negative in the months ahead. For those without subsidies, federal officials estimate, the cost of insurance policies is likely to increase by an average of another 7.5 percent; even more in states like Oklahoma and Mississippi. The individuals who are likely losers from the mandate have incomes 250 percent or more above the federal poverty level, the paper said. (That figure is $29,425; the federal poverty level is $11,770 for a single person, more for larger families). They are by no means the poorest Americans, but many of them are not wealthy, either. So the Affordable Care Act may not be as egalitarian as it might look initially, once we take this perspective into account.

It is a matter of philosophy whether we should help people even if they may not want to bear the costs, or instead should honor their individual preferences, but either way there is a sustainability problem. Consider that the health law was enacted to replace an unsustainable system in which uninsured people relied on last-ditch emergency room care. Yet enrollment projections suggest that the Affordable Care Act’s insurance mandate may face sustainability issues of its own.

In short, while numerous government programs redistributed income toward the poor successfully in the past, successive improvements, as exemplified by the Affordable Care Act, have become harder to accomplish, as many of the easiest and most efficient opportunities have already been exploited. We have ended up at margins where political divisions and interest group capture make further progress harder to carry out, no matter how good the proposed policies may seem on the drawing board.

(Tyler Cowen is a professor of economics at George Mason University.)

http://www.nytimes.com/2015/11/08/upshot/obamacare-not-as-egalitarian-as-it-appears.html

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Comment:

By Don McCanne, M.D.

Is our health care system under Obamacare (ACA) an egalitarian system? Although ACA includes numerous policies designed to improve health care equity, it still falls far short. Conservative economist Tyler Cowen agrees, although his proposed solutions may be somewhat different from ours.

For a health care system to be egalitarian, it must be equitable. A well designed single payer system would achieve that equity. As an example, the financial burden on middle-income families that Tyler Cowen and many others have described would be lifted.

In the past, Cowen has supported “a Singapore-style system, with single payer on the catastrophic side rather than mandates for private insurance purchase.” Thus he would move us toward a more egalitarian system as well. But the many problems created by moving to the requisite health savings accounts would threaten health care equity, and, thus, threaten egalitarianism itself.

Single payer is the way to go, but let’s make sure that the system design maximizes egalitarianism.

Health at a Glance 2015
OECD Indicators

OECD

This 2015 edition of Health at a Glance – OECD Indicators presents the most recent comparable data on key indicators of health and health systems across the 34 OECD member countries. For a subset of indicators, it also reports data for partner countries.

From the Executive Summary

Health at a Glance 2015 presents cross-country comparisons of the health status of populations and the performance of health systems in OECD countries, candidate countries and key emerging economies.

The key findings of this publication are as follows.

New drugs will push up pharmaceutical spending unless policy adapts

Life expectancy continues to rise, but widespread differences persist across countries and socio-demographic groups

The number of doctors and nurses has never been higher in OECD countries

Out-of-pocket spending remains a barrier to accessing care

Too many lives are still lost because quality of care is not improving fast enough

Health at a Glance 2015 (Read online version – 220 pages):
http://www.keepeek.com/Digital-Asset-Management/oecd/social-issues-migration-health/health-at-a-glance-2015_health_glance-2015-en

Health at a Glance 2015 (links to PDFs of each section):
http://www.oecd-ilibrary.org/social-issues-migration-health/health-at-a-glance-2015_health_glance-2015-en

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Comment:

By Don McCanne, M.D.

Opponents of health care reform frequently dismiss efforts with the statement that the United States has the best health care system in the world. We don’t. This biennial report of OECD indicators provides international comparisons with tables and graphs that can be very useful in explaining why the United States needs to get serious with our health care reform efforts. It is shameful that we fall far behind our peer nations in so many of the crucial health indicators.

The second link above is particularly helpful since you can readily select international comparisons on whichever topic you want, such as infant mortality, overweight and obesity among children, international migration of nurses, out-of-pocket medical expenditure, and so forth.

Fixing our health care financing system alone will not solve all of our problems, but a single payer system would give us a much better infrastructure on which to function.

Statewide cancer report finds significant disparities in outcomes, quality of care by insurer

UC Davis Health System, November 5, 2015

A new report by the UC Davis Institute for Population Health Improvement (IPHI) comparing quality of care and outcomes for breast, colon, rectal, lung and prostate cancers according to source of health insurance coverage has identified substantial disparities in stage of diagnosis, providers’ use of recommended treatment and survival rates.

According to Kenneth W. Kizer, IPHI and CalCARES director, while cancer treatment has generally improved in recent years, disparities in quality of cancer treatment and survival rates by health insurance remain a significant population health problem.

“Our study found that there are substantial opportunities for improved cancer care among all categories of payers, although the greatest opportunities for improvement exist for patients with Medi-Cal coverage, Medicare/Medi-Cal dual eligibility or no health insurance,” Kizer said. “These patients were diagnosed at more advanced stages of disease, received lower quality of care and had poorer outcomes than persons having private insurance or insurance coverage through Medicare, VA or DoD.

“Given that Medi-Cal is now the largest insurance program in California, with enrollment increasing from 7 to over 12 million members over the past three years and the estimated cost of cancer care for Medi-Cal growing from $3 billion to well over $6 billion, we need to better understand why Medi-Cal patients are not faring better,” he said.

Other key report findings:

* Significantly larger proportions of Medi-Cal and uninsured patients were diagnosed at an advanced stage of disease compared to patients with other sources of health insurance.

* Medi-Cal and uninsured patients had generally less favorable five-year survival rates.

* Medicare/Medi-Cal dual eligible patients were least likely to receive recommended treatment for breast cancer and colon cancer.

* VA patients had the longest intervals between diagnosis and initiation of treatment, but they were generally more likely to receive recommended treatment, and their treatment outcomes compared favorably to patients with other types of health insurance.

* Medi-Cal patients were diagnosed with advanced (stage 4) prostate cancer more than three times as often as patients with private insurance.

http://www.ucdmc.ucdavis.edu/publish/news/newsroom/10522

Full IPHI report:
https://www.ucdmc.ucdavis.edu/iphi/resources/1117737_CancerHI_100615.pdf

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Comment:

By Don McCanne, M.D.

Medi-Cal is a chronically underfunded Medicaid health program for low-income individuals in California. As such, these patients do not receive as much support from the health care community as do otherwise insured patients. This study confirms that cancer patients in the Medi-Cal and in the Medicare/MediCal dual eligible programs have impaired access and impaired outcomes almost comparable to those of uninsured patients.

Of note is that Medicare patients with added Medi-Cal coverage fared worse than did Medicare patients without Medi-Cal coverage. It may be that their lower incomes were associated with other socio-economic problems that result in worse outcomes. It may also be that California has been moving dual eligible patients into Medicaid managed care programs when there is question about how effective these programs are in delivering essential services. Another possibility is that physicians may be rejecting these patients simply because of the welfare stigma of the Medi-Cal program, even though they are on Medicare.

The conservatives have been preaching that Medicaid is as bad as having no insurance at all, and may be even worse. Although their position has been largely refuted, they will surely add this study to their “proof” of this hypothesis. Governors in states that refused to expand their Medicaid programs will find solace in this report.

The solution is obvious. Improve Medicare so that it is a more comprehensive program, and then provide it to everyone. Although other socio-economic factors need to be addressed, at least we would be removing the Medicaid welfare stigma that includes chronic underfunding by our elected representatives.

Marketplace Plans Covering Out-Of-Network Care Harder To Find

By Michelle Andrews
Kaiser Health News, November 6, 2015

Health plans that offer coverage of doctors and hospitals outside the plan’s network are getting harder to find on the insurance marketplaces, according to two analyses published this week.

Two-thirds of the 131 carriers that offered silver-level preferred provider organization plans in 2015 will either drop them entirely or offer fewer of them in January, an analysis by the Robert Wood Johnson Foundation found. Those cutbacks will affect customers in 37 states, according to the foundation.

Preferred provider organization plans, or PPOs, typically offer coverage for doctors and hospitals that aren’t in the plan’s network, but require consumers to pay a larger share of the cost. In contrast, health maintenance organizations, which make up roughly half of the plans offered on the exchanges, generally don’t cover any care provided outside the plan’s network.

Last year, many insurers shrunk the networks of providers in the plans that they sold on the marketplace.

http://khn.org/news/marketplace-plans-covering-out-of-network-care-harder-to-find/

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A Tale Of Two Deliveries, Or An Out-Of-Network Problem

By Erin Taylor and Layla Parast
Health Affairs Blog, November 3, 2015

As co-workers and first-time moms-to-be, we shared much of the pregnancy journey together — including the same employer-sponsored health insurance plan. We even delivered within weeks of each other at the same hospital. For both of us, the key to managing the pain of labor and delivery was the epidural delivered by our anesthesiologists.

When it came to paying the bill, our hospital experiences diverged in one key way. Layla received an unexpected bill for $1,600 for anesthesiology services and warned Erin to expect the same. Yet Erin’s bill never came. Layla happened to deliver on a day when an out-of-network anesthesiologist was on call, while Erin was seen by an in-network anesthesiologist.

Patients who have gone out of their way to ensure they receive care at an in-network facility should not be surprised by bills for involuntary out-of-network services. One solution would be to require that all providers offering care at an in-network facility are included in the plan’s network. Absent that, a few policy changes in the current system could be a step in the right direction.

Make It Transparent

Hospitals could have patients preregister for a planned stay and work with the insurance company to provide each patient with the estimated total expected charges.

The key change here is that the estimated charges would include physician services for in- and out-of-network services. This approach would require the hospital to be straightforward with prospective patients regarding the likelihood of care being provided by out-of-network physicians

Make It Simple

Physician bills and insurance statements need to be simplified.

Clearer explanations of charges, reasons the insurance company did not pay the full amount, and why the patient is being charged would help consumers better understand their bills — and help prepare them to pay them.

Make It Available

Researchers and policymakers have questioned the limited hospital and physician networks in the ACA health insurance marketplaces, as these networks provide access to a smaller set of providers.

Some states, such as Texas, New York, and Louisiana, are tackling out-of-network billing, while legislation was recently introduced in Congress that would place limits on the ability to bill patients for out-of-network services provided at in-network hospitals.

Clearly spelling out expected health care costs, and the likelihood of out-of-network charges, would go a long way toward reducing the economic uncertainty associated with hospital stays — and help patients understand the billing statements they receive after discharge.

Blog Comment by Don McCanne, submitted but not published:

Our particular model of health care financing – a dysfunctional, fragmented, public and private multipayer system – is the most expensive way to finance health care, characterized especially by profound administrative waste. Trying to patch this system only adds further to the administrative complexity – in this case, the effort to create transparency and special handling of out-of-network charges and billing.

Modeling of health care financing systems has shown that the least expensive and most efficient are the national health service and single payer models. Considering our public support of Medicare, the single payer model would be the most feasible for the United States.

With the high numbers of uninsured and under-insured, with the reduced choice of care due to narrow networks, and with the increasing exposure to financial hardship due to shifting of risk to patients, we really do need to abandon the ACA experiment and move forward with a well-designed single payer system.

http://healthaffairs.org/blog/2015/11/03/a-tale-of-two-deliveries-or-an-out-of-network-problem/

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Comment:

By Don McCanne, M.D.

One of the more nefarious methods that private insurers use to reduce their responsibility to pay for health care is to refuse to pay for health care services provided outside of the networks of contracted physicians and hospitals that they, rather than the patient, have selected. They have tightened the screws by shrinking these networks and by dropping some of the PPO plans which permitted at least some out-of-network coverage, but at reduced rates.

As the anecdote presented in the Health Affairs Blog indicates, limited networks can be quite unfair. The two authors of the blog, a policy researcher and a statistician employed by RAND, showed how the same employer-sponsored plan covered obstetrical anesthesia for one but not for the other, simply because by chance one anesthetist was in-network and the other was not.

Recognizing the unfairness of this, the authors recommend some policy changes. They recommend more transparency so you would at least know that the services would not be covered, though it would require more administrative services to obtain and communicate that information. They recommend that bills and insurance statements be “simplified,” though they are actually asking that additional information be required to clarify the network status of each provider involved – more administrative activity. They also suggest that legislation be passed to require special handling of out-of-network charges – yet more administrative complexity.

Unfortunately, this demonstrates the flawed approach to problems with our health care financing system that permeates the health policy community today. They accept as a given our fragmented system of financing health care, as modified by the Affordable Care Act. Their policy approach avoids carefully defining the fundamental problem and moves on with mere patches to our highly dysfunctional system. As this example indicates, the patches typically compound the problems, especially by adding more administrative tasks to our system that is already sinking with administrative overload.

So what is the fundamental problem with narrow networks? It should be obvious. They are designed to benefit the private insurer by shifting more costs to patients who unavoidably or inadvertently obtain care outside of networks. This is not for the benefit of patients; it is detrimental to patient care. Health financing systems should be designed to benefit patients, not multibillion dollar corporations.

So the fundamental problem is the existence of the narrow networks. They need to be eliminated. Along with the narrow networks, all of the other profound administrative excesses that uniquely characterize the American health care financing system need to be eliminated as well. They need to be replaced with an efficient single payer financing system.

Although the Health Affairs Blog posted numerous responses more or less commending the authors for their astute policy recommendations, they did not post my response which happened to be a proposal that would actually prevent the out of network injustices. For that reason, I have included it in today’s message so that it would have at least some limited public exposure. Fortunately, they did post a response by Thomas Cox PhD RN who calls for a single national health insurer.

Physician spending and subsequent risk of malpractice claims: observational study

By Anupam B Jena, Lena Schoemaker, Jay Bhattacharya, Seth A Seabury
BMJ, November 4, 2015

Conclusions

Despite evidence that the majority of US physicians report practicing defensive medicine, no evidence exists on the broader question of whether greater resource use by physicians is associated with fewer malpractice claims. Our findings suggest that greater resource use, whether it reflects defensive medicine or not, is associated with fewer malpractice claims.

Discussion

Despite evidence that many physicians practice defensive medicine to reduce the risk of malpractice claims, no evidence exists on the broader question of whether a greater use of resources by physicians is associated with a reduced risk of such claims. We investigated the association between average resource use by physicians and subsequent malpractice claims. In six of seven specialties, we found that greater resource use was associated with statistically significantly lower subsequent rates of alleged malpractice incidents. For example, internists in the highest fifth of patient risk adjusted resource use were less than half as likely to face a future malpractice claim compared with those in the lowest fifth. Among obstetricians, those with higher caesarean rates — a procedure sometimes considered to be defensively motivated — had lower subsequent rates of alleged malpractice. These relations held even when we adjusted for patient characteristics and accounted for time invariant physician characteristics such as patient mix, clinical skills, or communication skills.

http://www.bmj.com/content/351/bmj.h5516-0.full.pdf+html

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Comment:

By Don McCanne, M.D.

Much has been written about the high costs of defensive medicine – excessive health care services that are delivered merely to protect against the potential of malpractice lawsuits. This study tends to reinforce the belief that there is a solid basis for defensive medicine since higher spending on health care is associated with fewer malpractice claims. But does this additional care represent defensive medicine, or does it represent beneficial health care services that prevent adverse outcomes?

Although physicians admit that they practice defensive medicine, do they really do so strictly because of fear of lawsuits? Or do they do so because there is a real possibility that the patient may experience a significant adverse outcome because of the physician’s failure to detect or manage a serious medical condition? Invariably the latter concern plays at least some role in the medical decisions made.

Imaging is probably the most common procedure that is thought all too often to represent defensive medicine, especially when you consider how many results are normal. But if the physician is 100 percent certain that the imaging procedure will not demonstrate any pathology, then she would not order it since she could not be sued for a condition that does not exist. Imaging is ordered only when there is a real possibility of an abnormal finding, even if the odds are low.

When physicians order low yield tests they often think of them as defensive medicine. But as physicians back off on low yield testing, the incidence of missed pathology increases, as does the risk of a malpractice suit. Thus the test that picks up significant pathology is a beneficial health care service and really should not be categorized as defensive medicine only because it also has that benefit. The same reasoning applies to a test that provides the benefit of reassurance that the potential pathology is not demonstrated.

With concerns about the very high costs of health care, many recommend that we do something to reduce all of this unnecessary defensive medicine. The problem with that is, for the reasons mentioned, not much of health care falls into the category of pure defensive medicine that is of absolutely no clinical value. Therefore there is not much savings to recover. You can talk about flat of the curve medicine or low yield medicine, but as soon as you start eliminating care, you sacrifice the health and well being of a few of your patients, not to mention that you deprive many others of the reassurance they would have from a negative test.

Another point is that so called defensive medicine is a very small percentage of the $3 trillion we are spending on health care, and we can afford that. After all, much of it is still beneficial.

If we really want to reduce waste, we should eliminate the profound administrative excesses of our dysfunctional, fragmented, multi-payer system, by adopting a single payer national health program. We would recover hundreds of billions of dollars that way. That is in contrast to this study that shows that spending more on patients is associated with a lower incidence of lawsuits. Whether we label that defensive medicine or beneficial health care services, we are not going to find much savings there.

Physicians Decry Broken Promise of Medicare Raise in 2016

By Robert Lowes
Medscape Medical News, November 3, 2015

The law that repealed Medicare’s sustainable growth rate (SGR) formula for physician pay called for an annual raise of 0.5% from 2016 through 2019 as part of a transition to value-based reimbursement.

When Congress passed the law in April, some leaders of organized medicine noted that the modest raise lagged behind the inflation rate, but said it was better than nothing. It was certainly better than the disastrous 21% pay cut that the SGR formula would have triggered in 2016. Medical societies sold their membership on the legislation, called the Medicare Access and CHIP Reauthorization Act (MACRA), in part by saying it would stabilize Medicare rates for several years.

However, the promised raise of 0.5% turned into a 0.3% pay cut in the fine print of the final 2016 Medicare fee schedule released last week. The reason? The Affordable Care Act (ACA) and several other laws that set Medicare reimbursement policy trumped MACRA.

Organized medicine isn’t taking it too well.

“Physicians were told that they would get an increase, and they’re not,” said Wanda Filer, MD, president of the American Academy of Family Physicians (AAFP). “It’s a morale breaker.”

In its 2016 fee schedule, the Centers for Medicare and Medicaid Services (CMS) walked through the math that produced the tiny pay cut in 2016. (For a fairly detailed explanation, click on the Medscape link below.)

Organized medicine saw the stealth pay cut coming in the 2016 fee schedule when it was released in draft form last summer for public comment. At that time, CMS said that its misvalued codes initiative had reduced fee-for-service spending by roughly 0.25%. In response, medical societies such as the AAFP, the American College of Physicians, and the American Medical Association, as well as the Medical Group Management Association (MGMA), urged CMS to tweak its methodology for essentially repricing codes and calculating the savings so it could hit the 1% target and avoid canceling the MACRA raise. MGMA called the agency’s approach “narrow.” The association recommended, among other things, that CMS base its calculations on a broader group of repriced codes than what the agency used.

In the final fee schedule issued last week, CMS stood its ground. “We continue to believe this approach is appropriate and compliant with statutory directives,” it said. The agency repeatedly stated that it was bound by “current law” — in other words, MACRA, the ACA, PAMA, and ABLE.

Halee Fischer-Wright, MD, the president and CEO of MGMA, said her group is “extremely disappointed that CMS failed to meet the [1%] target set by Congress.”

“Instead, CMS’s inaction will result in an across-the-board cut to physicians in 2016,” Dr Fischer-Wright said in a statement given to Medscape Medical News. “For all the ambitious plans touted by the agency to move Medicare toward a value-based payment system for physicians, its inability to adequately review misvalued codes under current fee-for-service calls into question how CMS will be able to implement far more sophisticated payment models in the future.”

Primary care physicians will feel the 0.3% Medicare rate cut more keenly than their specialist peers, said AAFP president Dr Filer.

“I think primary care physicians are working a minimum margin and working frequently at a deficit,” she said. “Practice costs haven’t declined, and primary care has been undervalued for a very long time.

“Any cut is a financial hit.”

The comments from Dr Filer and Dr Fischer-Wright stand in contrast to what the White House says about MACRA on its website: “At last, the doctors who care for seniors and many Americans with disabilities will no longer have to worry that about the possibility of an arbitrary cut in their pay.”

http://www.medscape.com/viewarticle/853878

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SGR Fix: APMs threaten physician burnout (RAND)

Comment by Don McCanne, M.D.
Quote of the Day, March 24, 2015

HR 1470, which Congress is scheduled to approve in only two days (March 26), would replace the flawed Sustainable Growth Rate (SGR) method of determining Medicare payments with a new Merit-based Incentive Payment System (MIPS). MIPS introduces considerable administrative complexity which would be a great burden to physicians, but the legislation allows physicians to opt out of MIPS by joining Alternative Payment Models (APMs) such as Accountable Care Organizations (ACOs) or Patient Centered Medical Homes (PCMHs). This RAND study of APMs reveals that physician members of APMs are at very high risk of BURNOUT.

https://www.pnhp.org/news/2015/march/sgr-fix-apms-threaten-physician-burnout-rand

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Comment:

By Don McCanne, M.D.

Earlier this year medical societies celebrated their success in helping to get Congress to eliminate the Sustainable Growth Rate (SGR) formula – a formula that could have resulted in a 21% reduction in Medicare payments – and replace it with a 0.5% yearly increase for the next few years. There are two important stories here.

The first is that SGR would be replaced with a new onerous Merit-based Incentive Payment System (MIPS) which would be used to push physicians into Alternative Payment Models (APMs) such as Accountable Care Organizations (ACOs) or Patient Centered Medical Homes (PCMHs). At that time RAND warned that physician members of APMs are at very high risk of burnout. Trading an SGR formula that was never enforced for a career in misery is hardly a rational move. But at least they got a 0.5% raise, or did they?

The second important issue is that CMS has reneged on the legislated promise of a 0.5% increase and instead is reducing rates in the traditional fee-for-service Medicare program by 0.3%. This is part of a long-term strategy to control Medicare spending by keeping rate increases below the rate of inflation. Over time, physicians have been struggling to meet expenses of caring for their Medicare patients and still have anything left to take home, with inflation eating away at their payments.

But more than that, this decision appeared to represent one more example of CMS supporting the privatization of Medicare. We have reported several examples of CMS overriding the legislated mandate to reduce overpayments to private Medicare Advantage (MA) plans. Each year they have been able to use administrative chicanery to convert the mandated reduction into an increase in payments for the private MA plans. But this year they are also using administrative chicanery to convert the legislatively mandated increase in payments into a decrease in the traditional FFS Medicare program.

Another example is that the government has reneged on their mandate to pay the costs that exceeded the risk corridors for the CO-OP plans, contributing to the financial collapse of over half of them this year. Although the CO-OPs were not Medicare plans, they were quasi-public plans that were designed to compete with the private insurers. Do you really believe that the government can readily find funds year after year to shore up the private Medicare Advantage plans, but in the first year of the CO-OPs they are incapable of finding more than 13% of the mandated funds to support risk corridor losses for these organizations?

Our government, under the Obama administration, is actively moving towards privatization of our public insurance programs. Under the private insurers we are seeing higher costs, impairment of access, financial hardship for patients, and no improvement in quality or outcomes.

We need single payer, but we also need to elect responsible stewards for our public programs.