Report to Congress: Social Risk Factors and Performance Under Medicare’s Value-Based Purchasing Programs

United States Department of Health and Human Services
Office of the Assistant Secretary for Planning and Evaluation, December 2016

Background

There is growing recognition that social risk factors – such as income, education, race and ethnicity, employment, community resources, and social support – play a major role in health. Despite ongoing efforts, significant gaps remain in health and in life expectancy based on income, race, ethnicity, and community environment.

At the same time, the health care system is increasingly moving towards higher levels of provider accountability for the quality, outcomes, and costs of care. Value-based or alternative payment models, which tie payment to the quality and efficiency of health care delivered, are in place in nearly all Medicare settings, including in hospitals, outpatient settings, and post-acute facilities.

These two issues are intersecting. If beneficiaries with social risk factors have worse health outcomes because the providers they see provide low-quality care, value-based purchasing could be a powerful tool to drive improvements in care and reduce health disparities. However, if beneficiaries with social risk factors have worse health outcomes because of elements beyond the quality of care provided, such as the social risk factors themselves, value-based payment models could do just the opposite. If providers have limited ability to influence health outcomes for beneficiaries with social risk factors, they may become reluctant to care for beneficiaries with social risk factors, out of fear of incurring penalties due to factors they have limited ability to influence.

This report, mandated by the Improving Medicare Post-Acute Care Transformation Act of 2014 or the IMPACT Act (P.L. 113-185), shares empirical analysis using existing Medicare data to help address these questions and provides considerations for policymakers while additional work using other data sources continues.

Findings

FINDING 1: Beneficiaries with social risk factors had worse outcomes on many quality measures, regardless of the providers they saw, and dual enrollment status was the most powerful predictor of poor outcomes.

FINDING 2: Providers that disproportionately served beneficiaries with social risk factors tended to have worse performance on quality measures, even after accounting for their beneficiary mix. Under all five value-based purchasing programs in which penalties are currently assessed, these providers experienced somewhat higher penalties than did providers serving fewer beneficiaries with social risk factors.

Strategies and Considerations

STRATEGY 1: Measure and Report Quality for Beneficiaries with Social Risk Factors

Consideration 1: Consider enhancing data collection and developing statistical techniques to allow measurement and reporting of performance for beneficiaries with social risk factors on key quality and resource use measures.

Consideration 2: Consider developing and introducing health equity measures or domains into existing payment programs to measure disparities and incent a focus on reducing them.

Consideration 3: Prospectively monitor the financial impact of Medicare payment programs on providers disproportionately serving beneficiaries with social risk factors.

STRATEGY 2: Set High, Fair Quality Standards for All Beneficiaries

Consideration 1: Measures should be examined to determine if adjustment for social risk factors is appropriate; this determination will depend on the measure and its empirical relationship to social risk factors.

Consideration 2: The measure development community should continue to study program measures to determine whether differences in health status might underlie the observed relationships between social risk and performance, and whether better adjustment for health status might improve the ability to differentiate true differences in performance between providers.

STRATEGY 3: Reward and Support Better Outcomes for Beneficiaries with Social Risk Factors

Consideration 1: Consider creating targeted financial incentives within value-based purchasing programs to reward achievement of high quality and good outcomes, or significant improvement, among beneficiaries with social risk factors.

Consideration 2: Consider using existing or new quality improvement programs to provide targeted support and technical assistance to providers that serve beneficiaries with social risk factors.

Consideration 3: Consider developing demonstrations or models focusing on care innovations that may help achieve better outcomes for beneficiaries with social risk factors.

Consideration 4: Consider further research to examine the costs of achieving good outcomes for beneficiaries with social risk factors and to determine whether current payments adequately account for any differences in care needs.

Conclusions

Social factors are powerful determinants of health. In Medicare, beneficiaries with social risk factors have worse outcomes on many quality measures, including measures of processes of care, intermediate outcomes, outcomes, safety, and patient/consumer experience, as well as higher costs and resource use. Beneficiaries with social risk factors may have poorer outcomes due to higher levels of medical risk, worse living environments, greater challenges in adherence and lifestyle, and/or bias or discrimination. Providers serving these beneficiaries may have poorer performance due to fewer resources, more challenging clinical workloads, lower levels of community support, or worse quality.

The scope, reach, and financial risk associated with value-based and alternative payment models continue to widen. There are three key strategies that should be considered as Medicare aims to administer fair, balanced programs that promote quality and value, provide incentives to reduce disparities, and avoid inappropriately penalizing providers that serve beneficiaries with social risk factors. Measuring and reporting quality for beneficiaries with social risk factors, setting high, fair quality standards for all beneficiaries, and the provision of targeted rewards and supports for better outcomes for beneficiaries with social risk factors, may help ensure that all Medicare beneficiaries can achieve the best health outcomes possible.

Next Steps

The findings outlined in this report represent only the beginning of a body of necessary work around fair and accurate quality measurement in the context of Medicare’s increasing use of value-based purchasing programs. The IMPACT Act lays out specific additional requirements for Study B, including the examination of specific social risk factors not currently available in Medicare data such as health literacy, limited English proficiency, and Medicare beneficiary activation (the degree to which beneficiaries have the knowledge, skill, and confidence to manage their health and health care). Based on the findings in this report, future work may also include examining the impact of measuring and accounting for functional status or frailty on the relationship between social risk factors and performance, and identifying care innovations associated with the achievement of good health outcomes for beneficiaries with social risk factors.

Full report (374 pages):
https://aspe.hhs.gov…

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Comment:

By Don McCanne, M.D.

One of the problems with the various pay-for-performance schemes is that social risk factors play a major role in health care outcomes. Dedicated physicians and hospitals who take care of patients with greater social risks tend to be penalized for factors over which they have no direct control. This 374 page ASPE report was generated at the request of Congress to define this problem and consider solutions.

Skim reading this report leads to the conclusion that the approach to evaluating the role of social risk factors in payment systems using value-based purchasing, alternative payments models and other forms of payment innovation results in profound administrative complexity, with all of its waste, and yet it is still not very effective in correcting payment injustices. And this 374 pages is only the bare beginning of a “a body of necessary work around fair and accurate quality measurement in the context of Medicare’s increasing use of value-based purchasing programs.”

We continue to head down the wrong path. Our target should be to establish universality in health care while financing the system equitably with a system that reduces administrative waste. Instead you would think, based on the responses of the policy community and government bureaucrats, that the problem is that we do not have enough administrative oversight, so they propose more and more and more!

Instead we should reduce administrative waste by establishing a single payer national health program and improve value through global budgets, negotiated payment rates, and administered pricing, plus separate budgeting of capital distribution and system capacity. The latter should help to improve care for patients with higher social risk factors, though we do need to improve social programs that would better address the fundamental factors resulting in otherwise amenable social risks.

Right Care Series

The Lancet, January 8, 2017

Many countries struggle with the question about sustainability, fairness, and equity of their health systems. With the focus firmly on universal health coverage as a central part to the UN Sustainable Development Goals, there is an opportunity to examine how to achieve optimum access to, and delivery of, health care and services. Underuse and overuse of medical and health services exist side-by-side with poor outcomes for health and wellbeing. This Series of four papers and accompanying comments examines the extent of overuse and underuse worldwide, highlights the drivers of inappropriate care, and provides a framework to begin to address overuse and underuse together to achieve the right care for health and wellbeing. The authors argue that achieving the right care is both an urgent task and an enormous opportunity.

The full “Right Care” series is available for free through this link, though registration is required:
http://www.thelancet.com…

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Right Care 1: Evidence for overuse of medical services around the world

By Shannon Brownlee, Kalipso Chalkidou, Jenny Doust, Adam G Elshaug, Paul Glasziou, Iona Heath, Somil Nagpal, Vikas Saini, Divya Srivastava, Kelsey Chalmers, Deborah Korenstein

Overuse, which is defined as the provision of medical services that are more likely to cause harm than good, is a pervasive problem. Direct measurement of overuse through documentation of delivery of inappropriate services is challenging given the difficulty of defining appropriate care for patients with individual preferences and needs; overuse can also be measured indirectly through examination of unwarranted geographical variations in prevalence of procedures and care intensity. Despite the challenges, the high prevalence of overuse is well documented in high-income countries across a wide range of services and is increasingly recognised in low-income countries. Overuse of unneeded services can harm patients physically and psychologically, and can harm health systems by wasting resources and deflecting investments in both public health and social spending, which is known to contribute to health. Although harms from overuse have not been well quantified and trends have not been well described, overuse is likely to be increasing worldwide.

Key messages

• Overuse is difficult to measure and has not been well characterised
• Most studies of overuse have been done in high-income countries, but there is growing evidence that overuse is a global problem
• Overuse is likely to cause physical, psychological and financial harm to patients
• Overuse deflects resources from public health and other social spending in both low-income and high-income countries
• Overuse occurs across a wide range of medical specialties

“Though the doctors treated him, let his blood, and gave him medications to drink, he nevertheless recovered.” – Leo Tolstoy, War and Peace

http://www.thelancet.com…

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Right Care 2: Evidence for underuse of effective medical services around the world

By Paul Glasziou, Sharon Straus, Shannon Brownlee, Lyndal Trevena, Leonila Dans, Gordon Guyatt, Adam G Elshaug, Robert Janett, Vikas Saini

Underuse—the failure to use effective and affordable medical interventions—is common and responsible for substantial suffering, disability, and loss of life worldwide. Underuse occurs at every point along the treatment continuum, from populations lacking access to health care to inadequate supply of medical resources and labour, slow or partial uptake of innovations, and patients not accessing or declining them. The extent of underuse for different interventions varies by country, and is documented in countries of high, middle, and low-income, and across different types of health-care systems, payment models, and health services. Most research into underuse has focused on measuring solutions to the problem, with considerably less attention paid to its global prevalence or its consequences for patients and populations. Although focused effort and resources can overcome specific underuse problems, comparatively little is spent on work to better understand and overcome the barriers to improved uptake of effective interventions, and methods to make them affordable.

Key messages

• Underuse is responsible for substantial suffering, disability, and loss of life worldwide, in both high-income and low-income countries
• Underuse is prevalent across different types of health-care systems, payment models, and health services
• The causes of underuse are multi-layered:from inadequate access, health system failures, clinicians being unaware or unskilled to provide required interventions, and patients not accessing or declining them
• Underuse occurs alongside overuse, particularly in areas where there is competitive tension between profitable and low-cost interventions
• Policymakers, funders, clinicians, and civil society urgently need to recognise, invest, and resolve the slow uptake of effective, affordable, but non-promoted interventions

http://www.thelancet.com…

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Right Care 3: Drivers of poor medical care

By Vikas Saini, Sandra Garcia-Armesto, David Klemperer, Valerie Paris, Adam G Elshaug, Shannon Brownlee, John P A Ioannidis, Elliott S Fisher

The global ubiquity of overuse and underuse of health-care resources and the gravity of resulting harms necessitate an investigation of drivers to inform potential solutions. We describe the network of influences that contribute to poor care and suggest that it is driven by factors that fall into three domains: money and finance; knowledge, bias, and uncertainty; and power and human relationships. In each domain the drivers operate at the global, national, regional, and individual level, and are modulated by the specific contexts within which they act. We discuss in detail drivers of poor care in each domain

Conclusion

The provision of care is initiated by decision making within the doctor–patient relationship, but is substantially influenced by the resources available for health care within the society, its social and political contract, the state of global and local scientific knowledge, the configuration and capacity of the delivery system, and financing mechanisms.8,22,74,214 Achievement of the right care requires an understanding of and attentiveness to all these dimensions in the development of policy choices for promotion of care that is safe, effective, sensitive to personal preferences, and just.

Although no one factor results in the provision of right care, universal health coverage should be recognised as essential at the population level. Each factor can be deemed as equally necessary but equally insufficient by itself. Reducing the role of greed by structuring financial incentives to maximise true clinical benefits and social value is key. Ensuring vigilance against error and bias, broadening research aims, and a focus on meaningful outcomes are key goals in the production of knowledge. Therefore, re-addressing imbalances of knowledge and power, not only within the clinician–patient relationship but also within delivery systems, and more broadly in society, is equally crucial. There are potentially many levers to remedy poor care, but evidence of effectiveness is very modest.

Finally, as biological creatures conscious of our susceptibilty to injury, illness, and death, deep concerns about health are universal. Public support is therefore inevitably susceptible to manipulation for private gain. Active public education, engagement, and empowerment are crucial to ensure that the forces that shape health-care delivery worldwide are truly focused on delivering the right care.

http://www.thelancet.com…

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Right Care 4: Levers for addressing medical underuse and overuse: achieving high-value health care

By Adam G Elshaug, Meredith B Rosenthal, John N Lavis, Shannon Brownlee, Harald Schmidt, Somil Nagpal, Peter Littlejohns, Divya Srivastava, Sean Tunis, Vikas Sain

The preceding papers in this Series have outlined how underuse and overuse of health-care services occur within a complex system of health-care production, with a multiplicity of causes. Because poor care is ubiquitous and has considerable consequences for the health and wellbeing of billions of people around the world, remedying this problem is a morally and politically urgent task. Universal health coverage is a key step towards achieving the right care. Therefore, full consideration of potential levers of change must include an upstream perspective—ie, an understanding of the system-level factors that drive overuse and underuse, as well as the various incentives at work during a clinical encounter. One example of a system-level factor is the allocation of resources (eg, hospital beds and clinicians) to meet the needs of a local population to minimise underuse or overuse. Another example is priority setting using tools such as health technology assessment to guide the optimum diffusion of safe, effective, and cost-effective health-care services. In this Series paper we investigate a range of levers for eliminating medical underuse and overuse. Some levers could operate effectively (and be politically viable) across many different health and political systems (eg, increase patient activation with decision support) whereas other levers must be tailored to local contexts (eg, basing coverage decisions on a particular cost-effectiveness ratio). Ideally, policies must move beyond the purely incremental; that is, policies that merely tinker at the policy edges after underuse or overuse arises. In this regard, efforts to increase public awareness, mobilisation, and empowerment hold promise as universal methods to reset all other contexts and thereby enhance all other efforts to promote the right care.

Conclusions

The modern history of health care is littered with policy and practice inaction in the face of inappropriate care, often justified by an absence of evidence or uncertainty about what might result—Machiavelli’s “new order of things”. This lack of action should no longer be acceptable. Although the scale of the problem is vast and complex, a range of potentially effective remedies are available, with many more needed. Evidence-based medicine, HTA (health technology assessment), shared decision making, and countless other movements have surely nudged health systems to a point whereby we must ultimately acknowledge that a decision not to act is still a decision, and one with implications for people’s health. As efforts to improve the delivery of care continue worldwide, we must recognise that if the objective is to improve health, delivery systems need to be properly scaled and adapted to local needs and socioeconomic conditions to be maximally effective. Furthermore, delivery system leaders should remain humble about their systems’ contributions to health and should be unburdened from the task of substituting less effective medical spending for social spending. Transitions from the norm invariably cause conflict, but if efforts to achieve the right care are able to capture the full opportunity in front of us, the benefits to the wellbeing of patients, professionals, and the public as a whole are too great to condone inaction.

http://www.thelancet.com/pdfs/journals/lancet/PIIS0140-6736(16)32586-7.pdf

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Comment:

By Don McCanne, M.D.

Considering the amount of money we spend on health care in the United States, we should be making special efforts to see that we spend it right. This Lancet series, “Right Care,” is helpful because it defines for us where we are not providing enough care (underuse), leaving too many with unmet health care needs, and where we are providing excess care (overuse), wasting resources that could be used elsewhere, not to mention that excessive care is sometimes harmful.

Although many factors are involved in our misuse of health care, the financing system plays a significant role. We leave far too many people uninsured and underinsured which creates financial barriers to essential health care services. We have a maldistribution of our health care resources which impairs access to care in underserved areas.

By using a finance system that is based on business principles instead of public service, we are using financial disincentives, such as high deductibles, supposedly to discourage overuse but which, in fact, inappropriately incentivizes underuse. A well designed financing system, such as single payer, should go a long way toward addressing the problem of underuse, though other social factors would have to be addressed as well.

Overuse is a more difficult problem. Most health care is in a gray area. Obviously, expensive high-tech care that provides no benefit and is harmful is overuse and should be ferreted out of the system. But when high-tech care is beneficial it may be that it is no more beneficial than less expensive traditional care, but there inevitably would be disagreement on that, even after comparative effectiveness studies are completed. Many treatment regimens have potential adverse consequences, but that is often difficult to balance against the benefits that the patient may experience. Some low cost diagnostic and therapeutic interventions may lack scientific validation but if the interventions are essentially harmless and the patient is improved if for no other reason than reassurance, would this be considered overuse of our health care system? Although some might consider gray area medicine to be overuse, it would be very difficult to recover the costs of this care.

The “Right Care“ series addresses much more than the financing systems of health care, so it would be worthwhile to set time aside to read the articles (4 papers, 3 comments, and 1 perspective). It is imperative that we make “right care” a goal of reform.

But we really do need to get the financing system right. If we don’t, we’ll continue to see money wasted in more affluent areas where there is an excess capacity in high-tech care, and we’ll continue to see deficiencies in care for those who are not well served by our fragmented, dysfunctional system, market-based system.

Once we establish a publicly-financed and publicly-administered financing system, then we can work to improve the distribution and allocation of our resources to reduce waste while being sure that health care is there for people when they need it.

Remarks by the President in Vox Live Interview

By Ezra Klein and Sarah Kliff of Vox
The White House, Office of the Press Secretary, January 6, 2017

Excerpts of the President’s comments:

“…the challenge of getting it passed was always the fact that, unlike other advanced countries, we didn’t start with a system in which everybody was covered, and we have a very complicated marketplace, and we have third-party insurers.  And what that meant was that even after we got the law passed anything that dissatisfied people about the health care system could be attributed to — quote, unquote — “Obamacare,” even if it had nothing to do with Obamacare.”

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“…whenever you look at polls that say 40-something percent are supportive of the law and 40-something percent are dissatisfied — in the dissatisfied column are a whole bunch of Bernie Sanders supporters who wanted a single-payer plan.  (Laughter.)  And so the problem is not that they think Obamacare is a failure; the problem is that they don’t think it went far enough and that it left too many people still uncovered, that the subsidies that people were getting weren’t as rich as they should have been, that there’s a way of dealing with prescription drug makers in a way that drives down those costs.”

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“If it works, I’m for it.  If something can cover all Americans, make sure that if they have a preexisting condition they can still get coverage, make sure that prescription drugs are affordable, encourage preventive measures to keep people healthy, that makes sure that in rural communities people have access to substance abuse care or mental health care, that Medicare and Medicaid continue to function effectively — if you can do all that cheaper than we talked about, cheaper than Obamacare achieves and with better quality and it’s just terrific, I’m for it.”

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“In fact, if you look at how this law evolved — and I’ve said this publicly before, if I was starting from scratch, I probably would have supported a single-payer system because it’s just easier for people to understand and manage.  And that’s essentially what Medicare is, is a single-payer system for people of a certain age.  And people are very satisfied with it and it’s not that complicated to understand or to access services.  But that wasn’t available; we weren’t starting from scratch.”

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“From the very start, in the earliest negotiations in 2009, 2010, I made clear to Republicans that, if they had ideas that they could show would work better than the ideas that we had thought of, I would be happy to incorporate them into the law.  And rather than offer ideas, what we got was a big no, we just don’t want to do this.”

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“After the law passed, for the last six, seven years, there has been the argument that we can provide a great replacement that will be much better for everybody than what the Affordable Care Act is providing.  And yet, over the last six, seven years, there has been no actual replacement law that any credible health care policy experts have said would work better.  In fact, many of them would result in millions of people losing coverage and the coverage being worse for those who kept it.

“And so now is the time when Republicans, I think, have to go ahead and show their cards.  If, in fact, they have a program that would genuinely work better and they want to call it whatever they want — they can call it Trumpcare, they can call it McConnellcare, or Ryancare.  If it actually works, I will be the first one to say, great, you should have told me that back in 2009.  I asked.  (Laughter.)  I suspect that will not happen.”

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“I am saying to every Republican right now, if you, in fact, can put a plan together that is demonstrably better than what Obamacare is doing, I will publicly support repealing Obamacare and replacing it with your plan.  But I want to see it first.  (Applause.)  I want to see it first.”

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“This idea that somehow, oh, this is about Obama preserving his legacy — keep in mind, I’m not the one who named it Obamacare.  (Laughter.)  They were the ones who named it Obamacare, because what they wanted to do was personalize this and feed on antipathy towards me in their party as an organizing tool, as politics. 

“But I don’t have a pride of authorship on this thing.  If they can come up with something better, I’m for it.  But you have to show — and I would advise every Democrat to be for it — but you have to show that it’s better.  And that’s not too much to ask.”

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“…the answer is the Republicans, yes, will own the problems with the health care system if they choose to repeal something that is providing health insurance to a lot of people, and providing benefits to every American who has health insurance even if they’re getting it through the job, and they haven’t shown us what it is that they’re going to do.  Then they do own it.  Because that is irresponsible.  And even members of their own party, even those who are opposed to me, have said that that is an irresponsible thing to do.”

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“So if you look at the things that people are frustrated about with Obamacare, the Affordable Care Act, the big things are the subsidies aren’t as high as they’d like and they don’t have as many options as they’d like.  And I’m happy to provide both those things.  I’d sign on to a Republican plan that said we’re going to give more subsidies to people to make it even cheaper, and we’re going to have a public option where there isn’t an option. 

“Here’s the problem.  I don’t think that’s the thing that they want — (laughter) — to do.“

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“And my advice to the President-elect — in fact, we talked about this when I met with him for an hour and a half right after he got elected — I said make your team and make the Republican members of Congress come up with things that they can show will actually make this work better for people.  And if they’re convincing, I think you would find that there are a lot of Democrats out there — including me — that would be prepared to support it.  But so far, at least, that’s not what’s happened.”

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“Well, look, this is the irony of this whole debate, is the things that people are most dissatisfied with about Obamacare, about the Affordable Care Act, are things that essentially in other countries are solved by more government control, not less.  (Laughter.)  And so Republicans are pointing at these things to stir up dissatisfaction, but when it comes to, all right, what’s the solution for it, their answer is less government regulation and letting folks charge even more and doing whatever they want and letting the marketplace work its will.”

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“If we want to control prices for consumers more, then the marketplace by itself will not do that.  And the reason is because health care is not exactly like other products.  It’s not like buying a flat-screen TV.  If you’re sick, or if your kid is sick, most of the time you’re not in a position to negotiate right there and then.  You can’t walk out of the store and say, well, I’m going to see if I can get a better deal.”

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“The problem is, is that that’s not what’s being proposed by Mitch McConnell, the senator from Kentucky.  Instead what he’s proposing, I gather, is you’re going to repeal the law, then you’re going to come up with something, except you will have taken away all the — the way we pay for the subsidies for working people is we’re taxing wealthier folks at a little bit higher.  So he wants to cut those taxes, and that money would be gone right away.  And then he’s going to promise you, or those people who you’ve been signing up, better health care, except there’s not going to be any money to pay for it.  And nobody has explained to me yet how that’s going to work.”

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“…then at the very least you should be putting pressure on your members of Congress to say, show us exactly what the deal is going to be for us before you take away the deal that we got.”

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“The way this process is going to work, there’s this rushed vote that’s taking place this week, next week to — quote, unquote — “repeal Obamacare.”  But really all that is, is it’s a resolution that is then instructing these committees in Congress to start actually drafting a law that specifically would say what’s being repealed and what’s not.  Then, after that, they’d have to make a decision about what’s going to replace it and how long is that going to take.  And that stretches the process out further. 

“And so I think, whether you originally supported Obamacare or you didn’t, whether you like me or you don’t, the one thing I would just ask all the American people to do is adopt the slogan of the great state of Missouri — “Show me.”  (Laughter.)  Show me.  Do not rush this process. 

“And to Republicans, I would say:  What are you scared of?  If you are absolutely convinced, as you have been adamant about for the last seven years, that you can come up with something better, go ahead and come up with it.  And I’ll even cut you some slack for the fact that you’ve been saying you can come up with something better for seven years and I’ve never seen it.  (Laughter.)  But we’ll restart the clock.”

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Video (1 hour, 9 minutes):
https://www.whitehouse.gov…

Transcript:
https://www.whitehouse.gov…

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Comment:

By Don McCanne, M.D.

What is the point of today’s message? Virtually everyone wants affordable access to health care, for themselves at least. Most want a better system than what we have under the Affordable Care Act. But the nation is divided as to whether ACA needs to be repealed prior to improving the functioning of our health care financing system.

So the point is that there is broad agreement that we want the system improved, but the Republicans, who are in control, are hamstrung by their anti-government ideology which prevents them from offering the government solutions that we would need that would actually be effective in improving the system.

Repealing ACA would further impair the functioning of our system, so the Republicans would have to introduce effective policies that would more than compensate for the deficiencies that would be created by repeal. Almost any piecemeal solution would require greater regulation and more government spending, anathema to the Republicans. Suggestions to date coming from their camp would leave us worse off than what we currently have. It is no wonder that they refuse to tell us what their replacement proposal would be.

If they really do want to improve the system, and they say they do, then they have two choices. Either provide beneficial tweaks to the current system, which will cost more and require greater regulation, yet fall far short of reform goals, or replace the current system with a single payer national health program – an improved Medicare for all. The latter would greatly improve the financing of health care, ensuring true universality, improved access, greater choice in care, and affordability for each and every individual. And we could do that without increasing spending above our current level.

The Republicans have an opportunity to provide us with a replacement program that would be vastly superior to building on our current dysfunctional system. Both President Obama and President-elect Trump have acknowledged the clear superiority of a single payer system. Most progressives, a majority of moderates and a plurality of conservatives agree. Now all the Republicans need to do is show us.

Repealing the ACA without a Replacement — The Risks to American Health Care

By Barack H. Obama, J.D.
The New England Journal of Medicine, January 6, 2017

Health care policy often shifts when the country’s leadership changes. That was true when I took office, and it will likely be true with President-elect Donald Trump. I am proud that my administration’s work, through the Affordable Care Act (ACA) and other policies, helped millions more Americans know the security of health care in a system that is more effective and efficient. At the same time, there is more work to do to ensure that all Americans have access to high-quality, affordable health care. What the past 8 years have taught us is that health care reform requires an evidence-based, careful approach, driven by what is best for the American people. That is why Republicans’ plan to repeal the ACA with no plan to replace and improve it is so reckless. Rather than jeopardize financial security and access to care for tens of millions of Americans, policymakers should develop a plan to build on what works before they unravel what is in place.

Thanks to the ACA, a larger share of Americans have health insurance than ever before. Increased coverage is translating into improved access to medical care — as well as greater financial security and better health. Meanwhile, the vast majority of Americans still get their health care through sources that predate the law, such as a job or Medicare, and are benefiting from improved consumer protections, such as free preventive services.

We have also made progress in how we pay for health care, including rewarding providers who deliver high-quality care rather than just a high quantity of care. These and other reforms in the ACA have helped slow health care cost growth to a fraction of historical rates while improving quality for patients. This includes better-quality and lower-cost care for tens of millions of seniors, individuals with disabilities, and low-income families covered by Medicare, Medicaid, and the Children’s Health Insurance Program. And these benefits will grow in the years to come.

That being said, I am the first to say we can make improvements. Informed by the lessons we’ve learned during my presidency, I have put forward ideas in my budgets and a July 2016 article to address ongoing challenges — such as a lack of choice in some health insurance markets, premiums that remain unaffordable for some families, and high prescription-drug costs. For example, allowing Medicare to negotiate drug prices could both reduce seniors’ spending and give private payers greater leverage. And I have always welcomed others’ ideas that meet the test of making the health system better. But persistent partisan resistance to the ACA has made small as well as significant improvements extremely difficult.

Now, Republican congressional leaders say they will repeal the ACA early this year, with a promise to replace it in subsequent legislation — which, if patterned after House Speaker Paul Ryan’s ideas, would be partly paid for by capping Medicare and Medicaid spending. They have yet to introduce that “replacement bill,” hold a hearing on it, or produce a cost analysis — let alone engage in the more than a year of public debate that preceded passage of the ACA. Instead, they say that such a debate will occur after the ACA is repealed. They claim that a 2- or 3-year delay will be sufficient to develop, pass, and implement a replacement bill.

This approach of “repeal first and replace later” is, simply put, irresponsible — and could slowly bleed the health care system that all of us depend on. (And, though not my focus here, executive actions could have similar consequential negative effects on our health system.) If a repeal with a delay is enacted, the health care system will be standing on the edge of a cliff, resulting in uncertainty and, in some cases, harm beginning immediately. Insurance companies may not want to participate in the Health Insurance Marketplace in 2018 or may significantly increase prices to prepare for changes in the next year or two, partly to try to avoid the blame for any change that is unpopular. Physician practices may stop investing in new approaches to care coordination if Medicare’s Innovation Center is eliminated. Hospitals may have to cut back services and jobs in the short run in anticipation of the surge in uncompensated care that will result from rolling back the Medicaid expansion. Employers may have to reduce raises or delay hiring to plan for faster growth in health care costs without the current law’s cost-saving incentives. And people with preexisting conditions may fear losing lifesaving health care that may no longer be affordable or accessible.

Furthermore, there is no guarantee of getting a second vote to avoid such a cliff, especially on something as difficult as comprehensive health care reform. Put aside the scope of health care reform — the federal health care budget is 50% bigger than that of the Department of Defense. Put aside how it personally touches every single American — practically every week, I get letters from people passionately sharing how the ACA is working for them and about how we can make it better. “Repeal and replace” is a deceptively catchy phrase — the truth is that health care reform is complex, with many interlocking pieces, so that undoing some of it may undo all of it.

Take, for example, preexisting conditions. For the first time, because of the ACA, people with preexisting conditions cannot be denied coverage, denied benefits, or charged exorbitant rates. I take my successor at his word: he wants to maintain protections for the 133 million Americans with preexisting conditions. Yet Republicans in Congress want to repeal the individual-responsibility portion of the law. I was initially against this Republican idea, but we learned from Massachusetts that individual responsibility, alongside financial assistance, is the only proven way to provide affordable, private, individual insurance to every American. Maintaining protections for people with preexisting conditions without requiring individual responsibility would cost millions of Americans their coverage and cause dramatic premium increases for millions more. This is just one of the many complex trade-offs in health care reform.

Given that Republicans have yet to craft a replacement plan, and that unforeseen events might overtake their planned agenda, there might never be a second vote on a plan to replace the ACA if it is repealed. And if a second vote does not happen, tens of millions of Americans will be harmed. A recent Urban Institute analysis estimated that a likely repeal bill would not only reverse recent gains in insurance coverage, but leave us with more uninsured and uncompensated care than when we started.

Put simply, all our gains are at stake if Congress takes up repealing the health law without an alternative that covers more Americans, improves quality, and makes health care more affordable. That move takes away the opportunity to build on what works and fix what does not. It adds uncertainty to lives of patients, the work of their doctors, and the hospitals and health systems that care for them. And it jeopardizes the improvements in health care that millions of Americans now enjoy.

Congress can take a responsible, bipartisan approach to improving the health care system. This was how we overhauled Medicare’s flawed physician payment system less than 2 years ago. I will applaud legislation that improves Americans’ care, but Republicans should identify improvements and explain their plan from the start — they owe the American people nothing less.

Health care reform isn’t about a nameless, faceless “system.” It’s about the millions of lives at stake — from the cancer survivor who can now take a new job without fear of losing his insurance, to the young person who can stay on her parents’ insurance after college, to the countless Americans who now live healthier lives thanks to the law’s protections. Policymakers should therefore abide by the physician’s oath: “first, do no harm.”

http://www.nejm.org…

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Comment:

By Don McCanne, M.D.

The negative consequences of repealing the Affordable Care Act without replacing it with measures that address some of the problems that ACA was designed to fix have been well publicized. President Obama is right to warn us about repealing ACA without replacing it. But the full story is more complex.

Although the Republicans are moving ahead with including repeal of ACA in the budget reconciliation process, we do not have any details about what is being repealed nor when the repeal would actually take place, if ever. And the Republicans have no clue as to what their replacement would be, especially since it is obvious that their favored proposals such as health savings accounts and selling insurance across state borders would not effectively address the deficiencies that would be recreated by repeal.

Of greater concern, President Obama’s warning about repealing without replacement misses the bigger picture. ACA only tweaked our dysfunctional financing system when we needed comprehensive reform.

Obama touts ACA measures that supposedly saved money by replacing quantity with quality, but, in fact, such measures have not had even a negligible impact on overall cost containment. What they have done is to increase administrative complexity and waste, resulting in an epidemic of physician burnout.

He touts the increase in the numbers of individuals insured, but ignores the deterioration in quality of the coverage through the increase in financial barriers to care, especially high deductibles, and the impaired access that is resulting from expanded use of ever narrower provider networks.

He expresses regret that guaranteeing coverage to individuals with preexisting disorders requires a very unpopular individual mandate to purchase insurance (to prevent adverse selection), and yet he remains silent on the fact that social insurance programs such as Medicare are extremely popular and they rely on automatic coverage instead on an individual decision on whether or not to comply with a mandate.

He repeats the tag line that he used when he rejected single payer reform: we need to “build on what works and fix what does not.” Yet ACA patched only a few problems but did not begin to address the major deficiencies of our health care financing infrastructure, especially those resulting in profound administrative waste. ACA provided tweaks when we needed a new infrastructure.

And then – Primum non nocere – First do no harm. A system in which people are suffering, going broke, and sometimes even dying, is a system which is doing great harm. Reform should not be slogan driven. It should be built on what really does work to actually reduce harm. A single payer national health program – improved Medicare for all – does precisely that.