Kip Sullivan

Medpac struggles to define “medical home”

Medicare Payment Advisory Commission (MedPAC) Public Meeting, March 6, 2014

>From the transcript:

DR. [JULIE] SOMERS: Good afternoon. In this session, [Medpac staff] Kevin [Hayes], Katelyn [Smalley], and I would like to explore with you the idea of creating a per-beneficiary payment for primary care practitioners in the fee-for-service Medicare program. [p. 239]

…. [T]he Commission recommended establishing a medical home pilot [in 2008]. Variants of the recommendations for a primary care bonus and a medical home pilot were established under PPACA. … The [primary care bonus] program expires at the end of 2015, so we’d … like to hear the Commission’s views about extending the current program or replacing it with a per-beneficiary payment for primary care. [p. 240]

MR. [GLENN] HACKBARTH [MEDPAC CHAIR]: Okay. …. I am the one to blame if you don’t like this topic. I’m the instigator behind this, and I wanted just to say why that is. Why take this up now when there [are] … a number of medical home demonstration projects underway, some of which include Medicare? …. Why not just wait for the end of the medical home demonstrations?

There are two reasons for that. First … is the existing primary care bonus expires at the end of 2015…. Do we want to continue the existing bonus, or do we want to reconfigure it and do something like this?….

The second reason … is that I’ve become increasingly concerned about the medical home demonstrations on a number of different grounds. First of all, I am a little bit worried that the medical home model has … become gold-plated, and that in order to meet all of the NCQA requirements, et cetera, there are a lot of bells and whistles that have been added to it…. [M]y impression is that not all of them have really been validated as adding value, but they add cost, and so I’m worried that maybe the medical home model has a real cost disadvantage…. [pp. 251-253]

http://www.medpac.gov/transcripts/0314MedPAC_transcript.pdf

If you endorse a vague plan based on conventional wisdom rather than evidence and it doesn’t work, how do you revise it? Upon what evidence, by what logic, do you alter this or that part of the plan? The Medicare Payment Advisory Commission (Medpac) struggled with that problem at its March 6 meeting in the course of reviewing the performance of the “patient-centered medical home” (PCMH), an amorphous concept Medpac endorsed in 2008. The struggle did not go well. Commissioner after commissioner raised serious questions about the PCMH, but none of their questions triggered a productive discussion, the rationale for Medpac’s 2008 endorsement of the PCMH was never mentioned much less reviewed, and when the meeting was over it was impossible to say whether or how Medpac will propose changing the definition of the PCMH.

Revisiting the PCMH concept was Chairman Glenn Hackbarth’s idea. Hackbarth explained to his fellow commissioners that he wanted the commission to consider yet another PCMH experiment  because a temporary bonus for Medicare primary care doctors, authorized by the Affordable Care Act, is due to expire at the end of 2015. (The bonus is measured as a percent of each claim submitted by primary care doctors for Medicare patients.)

Mr. Hackbarth posed three questions to his fellow commissioners:

(1) Is it a good idea to extend the bonus beyond 2015?

(2) If so, should Medpac recommend that the bonus be extended as is or should the bonus be converted to a per-patient-per-year (capitation) payment?

(3) If the commission recommends converting the bonus to a capitation payment, should doctors be required to meet all the requirements of a “patient-centered medical home” (PCMH) established by the National Committee for Quality Assurance (NCQA)?

Commission members seemed unanimously to support extending the bonus, and 13 of the 17 commissioners expressed support for converting the bonus to “home” payments. But not a single commissioner offered an answer to Hackbarth’s third question – what requirements, if any, in the current definition of the PCMH should be stripped out?

Commission members made it clear they are concerned about the performance of the PCMH. Hackbarth opened the discussion by stating he believes the PCMH has become “gold-plated” – burdened with so many requirements (“electronic medical records and … 24-hour coverage and a long list of other requirements,” as he put it) that it can’t save money. (p. 267)

Other commissioners concurred. Scott Armstrong (CEO of Group Health Cooperative) and Dr. Rita Redberg observed that giving patients expanded access to doctors via e-mail has greatly expanded “virtual visits” without lowering face-to-face visits. (Armstrong added that “a lot” of what patients talk about in their e-mails “is useless.”) (pp. 275-276) Vice Chair Dr. Michael Chernew said he thought the “administrative requirements” currently imposed on the PCMH were a “hassle” and could outweigh any benefits the PCMH could achieve (p. 288). Willis Gradison said “adding too many requirements … to the structure of primary care” was driving doctors “into the arms of the hospitals.” (pp. 269-270)

Dr. David Nerenz suggested that the PCMH’s problem is more serious than merely being “gold-plated.” He questioned one of the most fundamental premises of the PCMH and all other managed care fads, namely, the claim that “care coordination … pays for itself [through] fewer admissions, fewer readmissions, fewer complications, fewer ED visits, fewer this, fewer that.” [p. 283]

John Christiansen (p. 279) and Peter Butler (p. 306) noted that the large systems that are buying up physician practices may not use PCMH payments for primary care, and Jack Hoadley observed that doctors may not be aware of the small capitation payments most PCMH programs pay to cover “home” services (p. 302).

Drs. Chernew (p. 291) and Rita Redberg (p. 278) noted that a growing body of research questions the conventional wisdom that the PCMH can cut costs by improving quality. Redberg, the editor of JAMA Internal Medicine, noted that she is seeing “a lot of manuscripts” that demonstrate the PCMH is not working as well “as one had hoped.”

Totally missing from this critical review of the PCMH was any discussion of Medpac’s justification for endorsing the PCMH in the first place. By a 16-0 vote, Medpac endorsed the “medical home” in its June 2008 report to Congresshttp://www.medpac.gov/chapters/Jun08_Ch02.pdf . But there was nothing in that report that resembled an evidence-based rationale for the PCMH. The “rationale” the Commission did offer exhibited the features typical of all managed care manifestos: The concept it purported to endorse was extremely vague, it was not supported by evidence, and it was oversold.

The 2008 report listed the usual string of vague attributes “homes” are supposed to have, including “use health IT” and “maintain 24-hour patient communication and rapid access,” the two features Mr. Hackbarth objected to. The report went on specifically to recommend that Medicare impose pay-for-performance schemes on “homes,” and that “homes” be required to use e-mail as a method of maintaining 24-hour access. But the report failed to offer any justification for its recommended list of PCMH features, and cited not a single study in support of the list or any item on the list. The report seemed to say Medpac relied on interviews with “experts” to derive this list, but even that is unclear.

Is it any wonder, then, that Medpac commissioners and staff did not revisit Medpac’s 2008 report for guidance on how to alter the definition of the PCMH in 2014?

Medpac has repeatedly made it clear it endorses the PCMH for the same reasons the American Academy of Family Physicians and other primary care groups did in 2007http://www.aafp.org/dam/AAFP/documents/practice_management/pcmh/initiati…  – as a means to bring more resources into primary care and to cut costs. The PCMH is probably not going to cut costs, and consequently it may backfire as a method of strengthening primary care. If we want to strengthen primary care and cut costs at the same time, we will have to enact a single-payer system.

Connected health and the rise of the patient-consumer: How to achieve better care at a lower cost?

By William Frist
Health Affairs, February 2014

America’s health care delivery sector stands at a tipping point—a convergence of a growing, graying, and highly consumptive population with increasingly limited financial and human capital resources.

Policy makers naturally gravitate toward government to provide the framework for solutions to this worsening scenario…. I’ve spent about equal time in government and the private health sector, and I believe there are two other levers that are more likely to be effective.

The first lever is the rapid ascent of the newly empowered consumer, equipped for the first time with actionable knowledge that can affect his or her health. The second consists of magnificent advances in information technology (IT). The exponential growth and application of these technologies are revolutionizing, in a very short period of time, the automation, connectivity, decision support, and mining of health information and data, which together will radically transform and improve health care delivery.

These two forces are just beginning to come of age. Neither was a significant driver of health care value just three years ago. Today their potential is enormous. Together, the empowered consumer and rapidly advancing health IT will channel our chaotic, fragmented, and wasteful health care sector toward a more seamless, transparent, accountable, and efficient system. They will answer the underlying question of how we will get better care for less cost. They will be the primary keys for game-changing, value-driven reform, where provider compensation and payments are determined not by the type and number of specific services rendered but by the quality and outcomes of care provided.

…. Government is slow to change and even slower to self-correct. …But what America needs now is more health for less money…. And in that effort, the newly empowered consumer is likely to lead the way.

http://content.healthaffairs.org/content/33/2/191.full

In this article, William Frist, a former Republican senator from Tennessee, claims “the newly empowered consumer” will play the leading role in health care reform. According to Frist, “consumers” recently acquired immense power thanks to “magnificent advances in information technology (IT).” The “empowered consumer” aided by health IT will lead us to a “more seamless, transparent, accountable and efficient system.”

Why couldn’t Frist lower his decibel level a notch and simply call our attention to recent developments in HIT that have some potential to improve health and perhaps lower costs? Why all the undocumented hype?

In Frist’s case, it appears his conservative ideology is at work. He notes early in his paper that government is pokey and cannot be expected to play a leading role in health care reform. If he can draw readers into his fantasies about patients with the powers of comic book figures, readers might be less likely to ask government to play a leading role in solving the health care crisis.

But Frist’s conservative values can’t be the entire explanation because thousands of American health policy experts with no discernible political leanings, and many Democrats, talk just like him. Frist’s article represents a common style of argument utilized by American health policy researchers as well as the politicians who listen to them. Hillary Clinton, Tom Daschle, Newt Gingrich and Tommy Thompson are other examples of politicians who have been influenced by managed-care speak.

In the rest of this comment I will use Frist’s paper as a case study with which to elucidate three key elements of this style.

First, the subjects of discussion – the mechanisms that will allegedly ameliorate the crisis – are described so abstractly it is difficult to know how to refute or confirm the claims made for them. The “accountable care organization” is a prominent example. The “empowered consumer” is another. Frist offers us not one example of how any of us would know if we fall into the category of “empowered,” and he is vague about how “rapidly advancing health IT” will confer “power” upon patients.

If Frist had simply argued that Americans are becoming more knowledgeable about their health, we might quibble about how true that is but we wouldn’t be baffled by his argument. But he speaks of more “power,” not more knowledge. Does he mean that thanks to growing access to medical records via computers, for example, that patients now have the power to browbeat insurance companies into paying for their medical care if the insurance company refuses? Does he mean that because of the numerous apps one can buy to monitor calories consumed, steps walked per day, etc. that patients have the power to force drug companies and hospitals to lower their prices?

A second characteristic of managed-care speak is the use of value-laden labels to refer to the aforementioned amorphous concepts. As Ted Marmor has noted on numerous occasions, and as he and Jonathan Oberlander noted in a recent paperhttp://www.ncbi.nlm.nih.gov/pmc/articles/PMC3514994, the vague concepts advanced by American health policy experts often bear labels designed to persuade rather than enlighten. “Empowered consumers” and “seamless” care are two examples from Frist’s paper. “Accountable care,” “coordinated care,” and “integrated delivery systems” are common examples one could find in myriad other articles. What do those labels mean? And who could be in favor of their opposites, for example, “unaccountable care” or “disempowered patients”?

A third common feature of the style I’m talking about is the confidence with which conclusions are asserted even though no evidence is marshaled to support the claim, or the evidence cited is incomplete, cherry-picked, or flat wrong. In Frist’s case, he could have limited his argument to a simple statement that the spread of electronic medical records and mobile phones and the invention of numerous apps might create a better informed patient among the segment of the population that can afford access to the Internet and myriad apps. But he did not do that. Instead he got out his trumpet and heralded the coming of a new age.

Those three features – poorly defined concepts, value-laden names for these concepts, and exaggerated claims for them – coupled with their ubiquitousness are lethal for busy readers, especially busy politicians who don’t have time to give definitions a reality check and to read papers cited in endnotes to see if they say what the writer said they said. The net effect is a form “truthiness,” to borrow Stephen Colbert’s wonderful label for claims that seem to be true but aren’t.  http://www.merriam-webster.com/info/06words.htm

This “truthiness” – the illusion that what experts like Frist say is based on science – is a major obstacle to a productive public debate about how to solve the health care crisis, and to the enactment of a single-payer system. It lends cover to politicians who want to take single-payer off the table.

Value-based insurance design program in North Carolina increased medication adherence but was not cost neutral

By Matthew L. Maciejewski et al.
Health Affairs, February 2014

Value-based insurance design (VBID) … is based on the premise that higher medication and administrative expenses incurred by insurers will be offset by lower nonmedication expenditures that result from better disease control. This article examines Blue Cross Blue Shield of North Carolina’s VBID program, which began in 2008. The program eliminated copayments for generic medications and reduced copays for brand-name medications. Patient adherence improved 2.7–3.4 percent during the two-year study period. Hospital admissions decreased modestly, but there were no significant changes in emergency department use or total health expenditures. The insurer incurred $6.4 million in higher medication expenditures; total nonmedication expenditures for the study population decreased $5.7 million. Our results provide limited support for the idea that VBID can be cost-neutral in specific subpopulations…..

[S]tatistically insignificant short-term changes in expenditures fall short of demonstrating that VBID can bend the cost curve as anticipated by its proponents.

http://content.healthaffairs.org/content/33/2/300.full

In the space of a decade and a half, the concept of “value-based insurance design” has undergone a rapid transformation: from an idea few had heard of; to the latest health policy fad; to the subject of some very good research that refuted claims that VBID will cut costs. It is not unusual for unproven health policy notions to leap onto center stage. It is unusual, however, to see them subjected to unbiased, rigorous analysis so soon after they have been loosed on the public. For cultural anthropologists who like to study the mores of the US health policy community, the VBID fad provides an interesting case study because its treatment has to date proven to be the exception to the rule.

At the turn of this century, the label “value-based insurance design” had not been invented, and discussion of the underlying concept was limited to a few professional journals. Judging from several of the early papers on the concepthttp://www.ncbi.nlm.nih.gov/pubmed/11570020, its advocates were motivated by a desire to counteract the destructive effects of yet another health policy fad – the “consumer-driven” health policy.

In 2004, thanks largely to an article in the Wall Street Journal, the VBID idea burst out of obscurity and quickly became another hyped nostrum in the managed care pharmacopeia. The article described a successful experiment by Pitney Bowes, a self-insured Fortune 500 company, designed to reduce its total health care spending on employees with asthma and diabetes by reducing copayments on asthma and diabetes drugs. http://www.sph.umich.edu/vbidcenter/news/pdfs/2004_WSJ%20article%20%20(2).pdf

By 2005 the VBID label had been invented and a VBID “center” had been created at the University of Michigan. By 2006 the VBID label was appearing regularly in the professional literature. For the next several years the lay and professional literature published claims that VBID was not just good for patients but would also lower spendinghttp://content.healthaffairs.org/content/26/2/w204.full  By 2009 congressional Democrats had incorporated VBID into legislation that would become the ACA and, when the ACA was enacted in March 2010, VBID was engraved into US law. (The phrase appears in the third full paragraph of the ACA under a paragraph entitled, “Coverage of preventive services.” http://www.gpo.gov/fdsys/pkg/BILLS-111hr3590enr/pdf/BILLS-111hr3590enr.pdf  It reads: “The Secretary [of Health and Human Services] may develop guidelines to permit a group health plan and a health insurance issuer … to utilize value-based insurance designs.”)

But at about the time the ACA was enacted, research was beginning to demonstrate that VBID, at least as it applied to drugs, did not save money. A paper co-authored by, among others, people affiliated with Pitney Bowes concluded that Pitney Bowes’ VBID program did not cut costs http://content.healthaffairs.org/content/29/11/1995.full?ijkey=V1BuR15ZD….  A literature review published in Health Affairs in 2013 concluded VBID programs “were consistently associated with improved adherence (average change of 3.0 percent over one year),” but they did not lead to “significant changes in overall medical spending for patients and insurers.” http://www.ncbi.nlm.nih.gov/pubmed/23836741 The study by Maciejewski et al. quoted above, which examined the first VBID program run by an insurance company (as opposed to a self-insured company), reached the same conclusion. The insurance company, Blue Cross Blue Shield of North Carolina, lowered copayments for medications prescribed for hypertension, hyperlipidemia, diabetes, and congestive heart failure. Adherence rates rose 3 percent over the first two years (2008-2009), but total spending did not fall.

It is instructive to ask at this point what it is about the VBID proposal that distinguishes it from other long-lived managed care fads such as the HMO, “coordination,” utilization review, report cards, and electronic medical records, all of which were and still are promoted as cost-containment ideas. A closer look at the VBID’s evolution suggests three features account for VBID’s different treatment:

•  It was clearly defined;

•  its costs, including the indirect costs, were much easier to measure; and

•  the great majority of all costs were paid by the same payer (a self-insured employer and, more recently, an insurance company).

By contrast, many managed care fads are poorly defined, their indirect costs (for example, the administrative costs that utilization review imposes on providers) are harder to track, and the costs (as opposed to the savings) are absorbed by multiple parties.

A few payers have recently begun to experiment with applying the VBID concept beyond prescription drugs and using the “stick” approach (higher copayments for “lower valued” services) rather than the “carrot” approach (lower copayments for “higher valued” services). If that practice becomes widespread, the VBID concept may become more amorphous and its costs more difficult to track. In that event, we may see a resurgence in evidence-free claims about the potential for VBID to cut costs. If that happens, researchers should insist that analyses of VBID must continue to include an examination of all costs generated by VBID, including patient out-of-pocket expenses and higher medical costs caused by any damage to patient health.