Financing Medicare Into The Future: Premium Support Fails The Risk-Bearing Test

One often-discussed option for controlling Medicare spending is to switch to a premium-support design. This would shift part of the risk of future health care cost increases from the federal treasury to Medicare beneficiaries. The economics of risk bearing suggests that this would be a mistake for three reasons. First, political decisions, not beneficiary choices, are the critical determinants of future health care costs. Second, only Congress can take into account the consequences of cost-containment decisions for both current and future generations. Third, the federal government is best able to diversify against the risk of future cost growth. Tying Medicare spending to the government's budget so that Congress sees the benefits of tough cost containment choices is the only way to force the program to make those politically difficult decisions. Economic efficiency is served by retaining the program's current structure instead of shifting risk to beneficiaries.

Growing Number Of Unsubsidized Part D Beneficiaries With Catastrophic Spending Suggests Need For An Out-Of-Pocket Cap

Medicare Part D has no cap on beneficiaries' out-of-pocket spending for outpatient prescription drugs, and, unlike Medicare Parts A and B, beneficiaries are prohibited from purchasing supplemental insurance that could provide such a cap. Historically, most beneficiaries whose annual Part D spending reached the catastrophic level were protected from unlimited personal liability by the Low-Income Subsidy (LIS). However, we found that the proportion of beneficiaries whose spending reached that level but did not qualify for the subsidy-and therefore remained liable for coinsurance-increased rapidly, from 18 percent in 2007 to 28 percent in 2015. Moreover, average total per person per year spending grew much more rapidly for those who did not qualify for the LIS than for those who did, primarily because of differences in price and utilization trends for the drugs that represented disproportionately large shares of their spending. We estimated that a cap for all Part D enrollees in 2015 would have raised monthly premiums by only $0.40-$1.31 per member.

Consolidation Trends In California's Health Care System: Impacts On ACA Premiums And Outpatient Visit Prices

California has heavily concentrated hospital, physician, and health insurance markets, but their current structure and functioning is not well understood. We assessed consolidation trends and performed an analysis of "hot spots"-markets that potentially warrant concern and scrutiny by regulators in terms of both horizontal concentration (such as hospital-hospital mergers) and vertical integration (hospitals' acquisition of physician practices). In 2016, seven counties were high on all six measures used in our hot-spot analysis (four horizontal concentration and two vertical integration measures), and five counties were high on five. The percentage of physicians in practices owned by a hospital increased from about 25 percent in 2010 to more than 40 percent in 2016. The estimated impact of the increase in vertical integration from 2013 to 2016 in highly concentrated hospital markets was found to be associated with a 12 percent increase in Marketplace premiums. For physician outpatient services, the increase in vertical integration was also associated with a 9 percent increase in specialist prices and a 5 percent increase in primary care prices. Legislative proposals, actions by the state's attorney general, and other regulatory changes are suggested.

ACA Marketplace Premiums Grew More Rapidly In Areas With Monopoly Insurers Than In Areas With More Competition

Premiums have increased rapidly in the two most recent years of the health insurance Marketplaces, with notable variation across state rating areas. Some experts have speculated that these increases are due to greater enrollment among sicker patients, the expiration of market stabilization policies, or the federal government's discontinuation of funding for cost-sharing subsidies. However, these factors do not explain why some rating areas have experienced rapid premium growth, while others have experienced more modest increases. I used a comprehensive database of information about premiums and market characteristics for rating areas in states with federally facilitated Marketplaces to demonstrate that higher premiums are associated with local health insurance monopolies. In 2018, Marketplace premiums were 50 percent ($180) higher, on average, in rating areas with monopolist insurers, compared to those with more than two insurers. This was driven by large premium increases for the monopolist insurers' lowest-cost plans. Understanding how insurer competition has affected enrollment, costs, and quality will help guide future individual-market reforms.

HIV Treatment Substantially Decreases Hospitalization Rates: Evidence From Rural South Africa

The effect of HIV treatment on hospitalization rates for HIV-infected people has never been established. We quantified this effect in a rural South African community for the period 2009-13. We linked clinical data on HIV treatment start dates for more than 2,000 patients receiving care in the public-sector treatment program with five years of longitudinal data on self-reported hospitalizations from a community-based population cohort of more than 100,000 adults. Hospitalization rates peaked during the first year of treatment and were about five times higher, compared to hospitalization rates after four years on treatment. Earlier treatment initiation could save more than US$300,000 per 1,000 patients over the first four years of HIV treatment, freeing up scarce resources. Future studies on the cost-effectiveness of HIV treatment should include these effects.

Association Of A Regional Health Improvement Collaborative With Ambulatory Care-Sensitive Hospitalizations

Although regional health improvement collaboratives have been adopted nationwide to improve primary care quality, their effects on avoidable hospitalizations and costs remain unclear. We quantified the association of the Better Health Partnership, a primary care-led regional health improvement collaborative operating in Cuyahoga County, Ohio (Cleveland and surrounding suburbs), with hospitalization rates for ambulatory care-sensitive conditions. The partnership uses a positive deviance approach to identify, disseminate publicly, and accelerate adoption of best practices for care of patients with diabetes, heart failure, and hypertension. Using a difference-in-differences approach, we compared rates of hospitalizations for ambulatory care-sensitive conditions in six Ohio counties before (2003-08) and after (2009-14) the establishment of the partnership. Age- and sex-adjusted hospitalization rates for targeted ambulatory care-sensitive conditions in Cuyahoga County declined significantly more than the rates in the comparator counties in 2009-11 (106 fewer hospitalizations per 100,000 adult residents) and 2012-14 (91 fewer hospitalizations). We estimated that 5,746 hospitalizations for ambulatory care-sensitive conditions were averted in 2009-14, leading to cost savings of nearly $40 million.

Meal Delivery Programs Reduce The Use Of Costly Health Care In Dually Eligible Medicare And Medicaid Beneficiaries

Delivering food to nutritionally vulnerable patients is important for addressing these patients' social determinants of health. However, it is not known whether food delivery programs can reduce the use of costly health services and decrease medical spending among these patients. We sought to determine whether home delivery of either medically tailored meals or nontailored food reduces the use of selected health care services and medical spending in a sample of adults dually eligible for Medicare and Medicaid. Compared with matched nonparticipants, participants had fewer emergency department visits in both the medically tailored meal program and the nontailored food program. Participants in the medically tailored meal program also had fewer inpatient admissions and lower medical spending. Participation in the nontailored food program was not associated with fewer inpatient admissions but was associated with lower medical spending. These findings suggest the potential for meal delivery programs to reduce the use of costly health care and decrease spending for vulnerable patients.

High Spending Growth Rates For Key Diseases In 2000-14 Were Driven By Technology And Demographic Factors

We introduce a new source of detailed data on spending by medical condition to analyze US health care spending growth in the period 2000-14. We found that thirty conditions, which represented only 11.5 percent of all conditions studied, accounted for 42 percent of the real growth rate in per capita spending during this period, even though they accounted for only 13 percent of overall spending in 2000. Primary drivers of spending growth included the use of new technologies, a shift toward the provision of preventive-type services, and an aging and more obese population. The health benefits of many new technologies appeared to outweigh the associated expenditures on treatment, which indicates that these are cost-effective and provide a net value to society. However, while these technologies may be of value, new treatments are often more expensive than older ones.

Assessing The Value Of 40 Years Of Local Public Expenditures On Health

The US public and private sectors now spend more than $3 trillion on health each year. While critical studies have examined the relationship between public spending on health and health outcomes, relatively little is known about the impact of broader public-sector spending on health. Using county-level public finance data for the period 1972-2012, we estimated the impact of local public hospital spending and nonhospital health spending on all-cause mortality in the county. Overall, a 10 percent increase in nonhospital health spending was associated with a 0.006 percent decrease in all-cause mortality one year after the initial spending. This effect was larger and significant in counties with greater proportions of racial/ethnic minorities. Our results indicate that county nonhospital health spending has health benefits that can help reduce costs and improve health outcomes in localities across the nation, though greater focus on population-oriented services may be warranted.

Generic Price Competition For Specialty Drugs: Too Little, Too Late?

The case of generic imatinib demonstrates several potential barriers to effective generic price competition for specialty prescription drugs, including fewer market entrants, smaller-than-expected price reductions, shifts in prescribing toward more expensive brand-name treatments, and limited uptake of the generic product.

Strategies For Clinical Implementation: Precision Oncology At Three Distinct Institutions

Despite rapid advances in molecular diagnostics and targeted therapeutics, the adoption of precision medicine into clinical oncology workflows has been slow. Questions about clinical utility, inconsistent reimbursement for molecular diagnostics, and limited access to targeted therapies are some of the major hurdles that have hampered clinical adoption. Despite these challenges, providers have invested in precision medicine programs in an ongoing search for innovative care models to deliver improved patient outcomes and achieve economic gains. We describe the precision oncology medicine programs implemented by an integrated delivery system, a community care center, and an academic medical center, to demonstrate the approaches and challenges associated with clinical implementation efforts designed to advance this treatment paradigm. Payer policies that include coverage for broad genomic testing panels would support the broader application of precision medicine, deepen research benefits, and bring targeted therapies to more patients with advanced cancer.

The California Competitive Model: How Has It Fared, And What's Next?

California became very successful in controlling rising health care costs by promoting price competition through market-based, managed care policies. However, recent data reveal that the state has not been able sustain its initial success in controlling growth in hospital prices. Two powerful trends emerged in California that eroded the conditions needed to sustain price competition. To ensure timely access to emergency hospital services, government regulators enacted regulations that had the unintended effect of giving hospitals tremendous leverage when contracting with health plans. Also, antitrust authorities allowed hospitals to consolidate into multihospital systems by adding members that were not direct competitors in local markets. The combined effect of these policies and consolidation trends was a substantial reduction in the competitiveness of provider markets in California, which reduced health plans' ability to leverage competitive provider markets and negotiate lower prices and other benefits for their members. Policy makers can and should act to restore competitive conditions.

Mentor Mothers Program Improved Child Health Outcomes At A Relatively Low Cost In South Africa

In light of South Africa's high prenatal HIV prevalence and infant mortality rate, a cluster randomized controlled trial was conducted to evaluate an intervention called Philani+, which used community health workers (known as Mentor Mothers) to deliver pre- and postnatal home visits in Cape Town, South Africa, to improve maternal and child health. We assessed the costs and benefits of this intervention and made comparisons with other scenarios that depicted increased capacity and provision of nurse-delivered care. The recurrent cost of the twenty-four-month intervention was US$80,001. The major health outcomes analyzed were differences in the proportion of infants who were low birthweight, stunted, and suboptimally breastfed between intervention and control groups. Each case of low birthweight averted cost US$2,397; of stunted growth, US$2,454; and of suboptimal breastfeeding, US$1,618. Employment of community health workers was cost saving compared to that of nurses. Philani+ improved child health at a relatively low cost, considering the health system costs associated with low birthweight and undernutrition. The model could be suitable for replication in low-resource settings to improve child health in other countries.

Global Lessons In Frugal Innovation To Improve Health Care Delivery In The United States

In a 2015 global study of low-cost or frugal innovations, we identified five leading innovations that scaled successfully in their original contexts and that may provide insights for scaling such innovations in the United States. We describe common themes among these diverse innovations, critical factors for their translation to the United States to improve the efficiency and quality of health care, and lessons for the implementation and scaling of other innovations. We highlight promising trends in the United States that support adapting these innovations, including growing interest in moving care out of health care facilities and into community and home settings; the growth of alternative payment models and incentives to experiment with new approaches to population health and care delivery; and the increasing use of diverse health professionals, such as community health workers and advanced practice providers. Our findings should inspire policy makers and health care professionals and inform them about the potential for globally sourced frugal innovations to benefit US health care.

Public And Private Payments For Physician Office Visits

We used data for 2014-15 from the Medical Expenditure Panel Survey to estimate standardized payments for nonelderly adults' physician office visits by type of insurance. Adults with public insurance, especially Medicaid, had substantially lower provider payments, out-of-pocket spending, and third-party payments than their peers with employer-sponsored or Marketplace insurance. Quantifying public-private payment differences can help clarify choices for financing health care among low-income Americans.

Medicare ACO Program Savings Not Tied To Preventable Hospitalizations Or Concentrated Among High-Risk Patients

It has been widely assumed that better management and coordination of care for chronic conditions and high-risk patients would be the leading mechanisms for achieving savings in accountable care organizations (ACOs), specifically by reducing acute care needs through enhanced outpatient and preventive care. We examined the extent to which changes in spending and hospitalizations for ACO patients in the Medicare Shared Savings Program (MSSP) have been consistent with this expectation. By 2014, participation in the MSSP was associated with significant reductions in total Medicare fee-for-service spending for ACO patients but with proportionately smaller reductions in hospitalizations and some increases in hospitalizations for ambulatory care-sensitive conditions. In addition, spending reductions were not clearly concentrated among high-risk patients: Reductions for those patients accounted for only 38 percent of the total reduction among ACOs entering the MSSP in 2012, and reductions among 2013 MSSP entrants were almost entirely concentrated among lower-risk patients. These findings suggest that, on average, care coordination and management efforts focused on ambulatory care-sensitive conditions and high-risk patients have not been the major drivers of early savings in the MSSP.

Low-Cost, High-Volume Health Services Contribute The Most To Unnecessary Health Spending

An analysis of data for 2014 about forty-four low-value health services in the Virginia All Payer Claims Database revealed more than $586 million in unnecessary costs. Among these low-value services, those that were low and very low cost ($538 or less per service) were delivered far more frequently than services that were high and very high cost ($539 or more). The combined costs of the former group were nearly twice those of the latter (65 percent versus 35 percent).

Per Visit Emergency Department Expenditures By Insurance Type, 1996-2015

Between 1996 and 2015, mean annual increases in per visit emergency department (ED) expenditures were significantly greater for private insurance than Medicare, Medicaid, and no insurance, with no corresponding difference in ED charges. Expenditures as a proportion of charges decreased for all insurers over time. Private insurance had the highest expenditure-to-charge ratio in each year.

Offering A Price Transparency Tool Did Not Reduce Overall Spending Among California Public Employees And Retirees

Insurers, employers, and states increasingly encourage price transparency so that patients can compare health care prices across providers. However, the evidence on whether price transparency tools encourage patients to receive lower-cost care and reduce overall spending remains limited and mixed. We examined the experience of a large insured population that was offered a price transparency tool, focusing on a set of "shoppable" services (lab tests, office visits, and advanced imaging services). Overall, offering the tool was not associated with lower shoppable services spending. Only 12 percent of employees who were offered the tool used it in the first fifteen months after it was introduced, and use of the tool was not associated with lower prices for lab tests or office visits. The average price paid for imaging services preceded by a price search was 14 percent lower than that paid for imaging services not preceded by a price search. However, only 1 percent of those who received advanced imaging conducted a price search. Simply offering a price transparency tool is not sufficient to meaningfully decrease health care prices or spending.

Americans Support Price Shopping For Health Care, But Few Actually Seek Out Price Information

The growing awareness of the wide variation in health care prices, increased availability of price data, and increased patient cost sharing are expected to drive patients to shop for lower-cost medical services. We conducted a nationally representative survey of 2,996 nonelderly US adults who had received medical care in the previous twelve months to assess how frequently patients are price shopping for care and the barriers they face in doing so. Only 13 percent of respondents who had some out-of-pocket spending in their last health care encounter had sought information about their expected spending before receiving care, and just 3 percent had compared costs across providers before receiving care. The low rates of price shopping do not appear to be driven by opposition to the idea: The majority of respondents believed that price shopping for care is important and did not believe that higher-cost providers were of higher quality. Common barriers to shopping included difficulty obtaining price information and a desire not to disrupt existing provider relationships.

End-Of-Life Medical Spending In Last Twelve Months Of Life Is Lower Than Previously Reported

Although end-of-life medical spending is often viewed as a major component of aggregate medical expenditure, accurate measures of this type of medical spending are scarce. We used detailed health care data for the period 2009-11 from Denmark, England, France, Germany, Japan, the Netherlands, Taiwan, the United States, and the Canadian province of Quebec to measure the composition and magnitude of medical spending in the three years before death. In all nine countries, medical spending at the end of life was high relative to spending at other ages. Spending during the last twelve months of life made up a modest share of aggregate spending, ranging from 8.5 percent in the United States to 11.2 percent in Taiwan, but spending in the last three calendar years of life reached 24.5 percent in Taiwan. This suggests that high aggregate medical spending is due not to last-ditch efforts to save lives but to spending on people with chronic conditions, which are associated with shorter life expectancies.

Mongolia's Public Spending On Noncommunicable Diseases Is Similar To The Spending Of Higher-Income Countries

Although there is increased recognition of the global challenge posed by noncommunicable diseases (NCDs), translating that awareness into resources for action requires better data than typically available in low- and middle-income countries. One middle-income country that does have good-quality information is Mongolia. Using detailed administrative data from Mongolia and supplementary survey-based information, we estimated public spending on four NCDs in Mongolia and reached four main conclusions. First, Mongolia's public spending patterns on NCDs are similar to NCD spending observed in countries with much higher per capita incomes. Second, public spending for NCDs is low relative to the NCD disease burden in Mongolia. Third, public-sector NCD spending is dominated by inpatient care and hospital-based specialist outpatient services, which suggests inefficiency in resource use. Finally, while public spending on cardiovascular disease is evenly distributed across regions, for cancers it is heavily concentrated in the nation's capital.

Less Intense Postacute Care, Better Outcomes For Enrollees In Medicare Advantage Than Those In Fee-For-Service

Traditional fee-for-service (FFS) Medicare's prospective payment systems for postacute care provide little incentive to coordinate care or control costs. In contrast, Medicare Advantage plans pay for postacute care out of monthly capitated payments and thus have stronger incentives to use it efficiently. We compared the use of postacute care in skilled nursing and inpatient rehabilitation facilities by enrollees in Medicare Advantage and FFS Medicare after hospital discharge for three high-volume conditions: lower extremity joint replacement, stroke, and heart failure. After accounting for differences in patient characteristics at discharge, we found lower intensity of postacute care for Medicare Advantage patients compared to FFS Medicare patients discharged from the same hospital, across all three conditions. Medicare Advantage patients also exhibited better outcomes than their FFS Medicare counterparts, including lower rates of hospital readmission and higher rates of return to the community. These findings suggest that payment reforms such as bundling in FFS Medicare may reduce the intensity of postacute care without adversely affecting patient health.

Innovative Environments In Health Care: Where And How New Approaches To Care Are Succeeding

Organizations seeking to create innovative environments in health care need to pay attention to a number of factors. These include making available sufficient resources, notably money and physical space, but also coordination and consultation regarding intellectual property and licensing; enabling access to engineers, software developers, and behavioral scientists; making providers and patients available to innovators; having a sufficiently long-term view; and insulating the innovation group from operational demands. If there is a single essential key to success, it is making innovation a strategic priority. Academic health systems are enormous generators of innovation in the form of generalizable research in biomedical sciences. Typically, much of that innovation is externally supported, and little is directed to improving care processes internally. In industries other than health care, organizations invest their own funds in research and development to promote innovation, and this investment is seen as a metric for a firm's commitment to its future. Increased investment in care-process innovation is long overdue.

Synthesis Of Research On Patient-Centered Medical Homes Brings Systematic Differences Into Relief

The patient-centered medical home (PCMH) model emphasizes comprehensive, coordinated, patient-centered care, with the goals of reducing spending and improving quality. To evaluate the impact of PCMH initiatives on utilization, cost, and quality, we conducted a meta-analysis of methodologically standardized findings from evaluations of eleven major PCMH initiatives. There was significant heterogeneity across individual evaluations in many outcomes. Across evaluations, PCMH initiatives were not associated with changes in the majority of outcomes studied, including primary care, emergency department, and inpatient visits and four quality measures. The initiatives were associated with a 1.5 percent reduction in the use of specialty visits and a 1.2 percent increase in cervical cancer screening among all patients, and a 4.2 percent reduction in total spending (excluding pharmacy spending) and a 1.4 percent increase in breast cancer screening among higher-morbidity patients. These associations were significant. Identification of the components of PCMHs likely to improve outcomes is critical to decisions about investing resources in primary care.

Impact Of Health Care Delivery System Innovations On Total Cost Of Care

Using delivery system innovations to advance health care reform continues to be of widespread interest. However, it is difficult to generalize about the success of specific types of innovations, since they have been examined in only a few studies. To gain a broader perspective, we analyzed the results of forty-three ambulatory care programs funded by the first round of the Center for Medicare and Medicaid Innovation's Health Care Innovations Awards. The innovations' impacts on total cost of care were estimated by independent evaluators using multivariable difference-in-differences models. Through the first two years, most of the innovations did not show a significant effect on total cost of care. Using meta-regression, we assessed the effects on costs of five common components of these innovations. Innovations that used health information technology or community health workers achieved the greatest cost savings. Savings were also relatively large in programs that targeted clinically fragile patients-clinically complex populations at risk for disease progression. While the magnitude of these effects was often substantial, none achieved conventional levels of significance in our analyses. Meta-analyses of a larger number of delivery system innovations are needed to more clearly establish their potential for patient care cost savings.

For Super-Utilizers, Integrated Care Offers A New Path

Many health systems continue to experiment with the best way to care for those patients who end up in the hospital most frequently.

Direct-To-Consumer Telehealth May Increase Access To Care But Does Not Decrease Spending

The use of direct-to-consumer telehealth, in which a patient has access to a physician via telephone or videoconferencing, is growing rapidly. A key attraction of this type of telehealth for health plans and employers is the potential savings involved in replacing physician office and emergency department visits with less expensive virtual visits. However, increased convenience may tap into unmet demand for health care, and new utilization may increase overall health care spending. We used commercial claims data on over 300,000 patients from three years (2011-13) to explore patterns of utilization and spending for acute respiratory illnesses. We estimated that 12 percent of direct-to-consumer telehealth visits replaced visits to other providers, and 88 percent represented new utilization. Net annual spending on acute respiratory illness increased $45 per telehealth user. Direct-to-consumer telehealth may increase access by making care more convenient for certain patients, but it may also increase utilization and health care spending.

Spending On Care After Surgery Driven By Choice Of Care Settings Instead Of Intensity Of Services

The rising popularity of episode-based payment models for surgery underscores the need to better understand the drivers of variability in spending on postacute care. Examining postacute care spending for fee-for-service Medicare beneficiaries after three common surgical procedures in the period 2009-12, we found that it varied widely between hospitals in the lowest versus highest spending quintiles for postacute care, with differences of 129 percent for total hip replacement, 103 percent for coronary artery bypass grafting (CABG), and 82 percent for colectomy. Wide variation persisted after we adjusted for the intensity of postacute care. However, the variation diminished considerably after we adjusted instead for postacute care setting (home health care, outpatient rehabilitation, skilled nursing facility, or inpatient rehabilitation facility): It decreased to 16 percent for hip replacement, 4 percent for CABG, and 21 percent for colectomy. Health systems seeking to improve surgical episode efficiency should collaborate with patients to choose the highest-value postacute care setting.

Little Evidence Exists To Support The Expectation That Providers Would Consolidate To Enter New Payment Models

Provider consolidation has been associated with higher health care prices and spending. The prevailing wisdom is that payment reform will accelerate consolidation, especially between physicians and hospitals and among physician groups, as providers position themselves to bear financial risk for the full continuum of patient care. Drawing on data from a number of sources from 2008 onward, we examined the relationship between Medicare's accountable care organization (ACO) programs and provider consolidation. We found that consolidation was under way in the period 2008-10, before the Affordable Care Act (ACA) established the ACO programs. While the number of hospital mergers and the size of specialty-oriented physician groups increased after the ACA was passed, we found minimal evidence that consolidation was associated with ACO penetration at the market level or with physicians' participation in ACOs within markets. We conclude that payment reform has been associated with little acceleration in consolidation in addition to trends already under way, but there is evidence of potential defensive consolidation in response to new payment models.

Affordable Care Act's Cadillac Tax Could Affect One-Fourth Of Workers With Employer Health Coverage By 2025

The excise tax on high-cost health insurance plans (known as the Cadillac tax) under the Affordable Care Act (ACA) is an important part of the law's attempt to control rising health care costs. Analysts using different data sources have come to divergent estimates of how many people would be affected by this tax. We used the National Compensation Survey from the Bureau of Labor Statistics, which is better suited to this analysis because of its law-relevant details on employer-provided health benefits. Our research clarifies an important area of empirical uncertainty, thereby informing the debate about the ACA and its proposed replacements. Our base estimate of impact, 12 percent of workers participating in employer-provided health plans in 2020, lies in the middle of other estimates, but it is considerably more comprehensive, accurate, and delineated by worker characteristics (region, number of employees at the firm, industry, occupation, and so on) than others. Workers affected at the highest rate include those in education occupations and high-income workers, while those in industries involving manual labor and public safety are affected at some of the lowest rates.

Antibiotic-Resistant Infection Treatment Costs Have Doubled Since 2002, Now Exceeding $2 Billion Annually

Antibiotic-resistant infections are a global health care concern. The Centers for Disease Control and Prevention estimates that 23,000 Americans with these infections die each year. Rising infection rates add to the costs of health care and compromise the quality of medical and surgical procedures provided. Little is known about the national health care costs attributable to treating the infections. Using data from the Medical Expenditure Panel Survey, we estimated the incremental health care costs of treating a resistant infection as well as the total national costs of treating such infections. To our knowledge, this is the first national estimate of the costs for treating the infections. We found that antibiotic resistance added $1,383 to the cost of treating a patient with a bacterial infection. Using our estimate of the number of such infections in 2014, this amounts to a national cost of $2.2 billion annually. The need for innovative new infection prevention programs, antibiotics, and vaccines to prevent and treat antibiotic-resistant infections is an international priority.

Asthma And Injustice On Chicago's Southeast Side

A physician discovers a potential environmental link to asthma attacks in a poor Chicago community.

After Medicaid Expansion In Kentucky, Use Of Hospital Emergency Departments For Dental Conditions Increased

Access to oral health care is a critical need for the adult Medicaid population. Following the 2014 expansion of Medicaid eligibility in Kentucky, millions of adults became eligible to receive dental benefits. We examined the impact of the expansion on adult Medicaid enrollees' use of hospital emergency departments (EDs) for conditions related to dental or oral health in the period 2010-14. Based on our analysis of data for Kentucky from the State Emergency Department Databases, we found that the rate of discharges for these conditions from the ED increased significantly, from 1,833 per 100,000 population in 2013 to 5,635 in 2014. Adults covered by Medicaid who used the ED for treatment of oral health conditions in 2014 had high levels of chronic comorbidities and were more likely to be male and nonwhite than those in earlier years. To avoid costly and inappropriate use of the ED, states considering adding an adult Medicaid dental benefit should consider also making changes to assist beneficiaries in obtaining access to the dental health care delivery system.

Better Patient Care At High-Quality Hospitals May Save Medicare Money And Bolster Episode-Based Payment Models

US policy makers are making efforts to simultaneously improve the quality of and reduce spending on health care through alternative payment models such as bundled payment. Bundled payment models are predicated on the theory that aligning financial incentives for all providers across an episode of care will lower health care spending while improving quality. Whether this is true remains unknown. Using national Medicare fee-for-service claims for the period 2011-12 and data on hospital quality, we evaluated how thirty- and ninety-day episode-based spending were related to two validated measures of surgical quality-patient satisfaction and surgical mortality. We found that patients who had major surgery at high-quality hospitals cost Medicare less than those who had surgery at low-quality institutions, for both thirty- and ninety-day periods. The difference in Medicare spending between low- and high-quality hospitals was driven primarily by postacute care, which accounted for 59.5 percent of the difference in thirty-day episode spending, and readmissions, which accounted for 19.9 percent. These findings suggest that efforts to achieve value through bundled payment should focus on improving care at low-quality hospitals and reducing unnecessary use of postacute care.

Affordable Care Act's Mandate Eliminating Contraceptive Cost Sharing Influenced Choices Of Women With Employer Coverage

Patient cost sharing for contraceptive prescriptions was eliminated for certain insurance plans as part of the Affordable Care Act. We examined the impact of this change on women's patterns of choosing prescription contraceptive methods. Using claims data for a sample of midwestern women ages 18-46 with employer-sponsored coverage, we examined the contraceptive choices made by women in employer groups whose coverage complied with the mandate, compared to the choices of women in groups whose coverage did not comply. We found that the reduction in cost sharing was associated with a 2.3-percentage-point increase in the choice of any prescription contraceptive, relative to the 30 percent rate of choosing prescription contraceptives before the change in cost sharing. A disproportionate share of this increase came from increased selection of long-term contraception methods. Thus, the removal of cost as a barrier seems to be an important factor in contraceptive choice, and our findings about long-term methods may have implications for rates of unintended pregnancy that require further study.

Changes In Health Status And Care Use After ACA Expansions Among The Insured And Uninsured

Following the Affordable Care Act's insurance expansion provisions in 2014, the average health status and use of health care within coverage groups has likely changed. Medicaid enrollees and the uninsured were both healthier in 2014 than those respective groups were in 2013. By contrast, those with individual private insurance coverage appeared less healthy as a group.

Combined Regional Investments Could Substantially Enhance Health System Performance And Be Financially Affordable

Leaders across the United States face a difficult challenge choosing among possible approaches to transform health system performance in their regions. The ReThink Health Dynamics Model simulates how alternative scenarios could unfold through 2040. This article compares the likely consequences if four interventions were enacted in layered combinations in a prototypical midsize US city. We estimated the effects of efforts to deliver higher-value care; reinvest savings and expand global payment; enable healthier behaviors; and expand socioeconomic opportunities. Results suggest that there may be an effective and affordable way to unlock much greater health and economic potential, ultimately reducing severe illness by 20 percent, lowering health care costs by 14 percent, and improving economic productivity by 9 percent. This would require combined investments in clinical and population-level initiatives, coupled with financial agreements that reduce incentives for costly care and reinvest a share of the savings to ensure adequate long-term financing.

Early Efforts By Medicare Accountable Care Organizations Have Limited Effect On Mental Illness Care And Management

People with mental illness use more health care and have worse outcomes than those without such illnesses. In response to incentives to reduce spending, accountable care organizations (ACOs) may therefore attempt to improve their management of mental illness. We examined changes in mental health spending, utilization, and quality measures associated with ACO contracts in the Medicare Shared Savings Program and Pioneer model for beneficiaries with mental illness, using Medicare claims for the period 2008-13 and difference-in-differences comparisons with local non-ACO providers. Pioneer contracts were associated with lower spending on mental health admissions in the first year of the contract, an effect that was attenuated in the second year. Otherwise, ACO contracts were associated with no changes in mental health spending or readmissions, outpatient follow-up after mental health admissions, rates of depression diagnosis, or mental health status. These results suggest that ACOs have not yet focused on mental illness or have been largely unsuccessful in early efforts to improve their management of it.

Using Federal Funds To Buy Obamacare For Native Americans

In Alaska and other states, tribes are experimenting with programs that provide private health insurance to members for free.

National Health Care Spending In 2016: Spending And Enrollment Growth Slow After Initial Coverage Expansions

Total nominal US health care spending increased 4.3 percent and reached $3.3 trillion in 2016. Per capita spending on health care increased by $354, reaching $10,348. The share of gross domestic product devoted to health care spending was 17.9 percent in 2016, up from 17.7 percent in 2015. Health spending growth decelerated in 2016 following faster growth in 2014 and 2015 associated with coverage expansions under the Affordable Care Act (ACA) and strong retail prescription drug spending growth. In 2016 the slowdown was broadly based, as spending for the largest categories by payer and by service decelerated. Enrollment trends drove the slowdown in Medicaid and private health insurance spending growth in 2016, while slower per enrollee spending growth influenced Medicare spending. Furthermore, spending for retail prescription drugs slowed, partly as a result of lower spending for drugs used to treat hepatitis C, while slower use and intensity of services drove the slowdown in hospital care and physician and clinical services.

Rising Use Of Observation Care Among The Commercially Insured May Lead to Total And Out-Of-Pocket Cost Savings

Proponents of hospital-based observation care argue that it has the potential to reduce health care spending and lengths-of-stay, compared to short-stay inpatient hospitalizations. However, critics have raised concerns about the out-of-pocket spending associated with observation care. Recent reports of high out-of-pocket spending among Medicare beneficiaries have received considerable media attention and have prompted direct policy changes. Despite the potential for changed policies to indirectly affect non-Medicare patients, little is known about the use of, and spending associated with, observation care among commercially insured populations. Using multipayer commercial claims for the period 2009-13, we evaluated utilization and spending among patients admitted for six conditions that are commonly managed with either observation care or short-stay hospitalizations. In our study period, the use of observation care increased relative to that of short-stay hospitalizations. Total and out-of-pocket spending were substantially lower for observation care, though both grew rapidly-and at rates much higher than spending in the inpatient setting-over the study period. Despite this growth, spending on observation care is unlikely to exceed spending for short-stay hospitalizations. As observation care attracts greater attention, policy makers should be aware that Medicare policies that disincentivize observation may have unintended financial impacts on non-Medicare populations, where observation care may be cost saving.

The role of health policy in the burden of breast cancer in Brazil

Background

Breast cancer affects millions of women worldwide, particularly in Brazil, where public healthcare system is an important model in health organization and the cost of chronic disease has affected the economy in the first decade of the twenty-first century. The aim was to evaluate the role of health policy in the burden of breast cancer in Brazil between 2004 and 2014.

Methods

Secondary analysis was performed in 2017 with Brazilian Health Ministry official data, extracted from the Department of Informatics of the National Health System. Age-standardized mortality and the age-standardized incidence of hospital admission by breast cancer were calculated per 100,000 people. Public healthcare costs were converted to US dollars. Regression analysis was performed to estimate the trend of breast cancer rates and healthcare costs, and principal component analysis was performed to estimate a cost factor. Stata® 11.0 was utilized.

Results

Between 2004 to 2014, the age-standardized rates of breast cancer mortality and the incidence of hospital admission and public healthcare costs increased. There was a positive correlation between breast cancer and healthcare public costs, mainly influenced by governmental strategies.

Conclusions

Governmental strategies are effective against the burden of breast cancer in Brazil.

Newly Eligible Enrollees In Medicaid Spend Less And Use Less Care Than Those Previously Eligible

Understanding the health care spending and utilization of various types of Medicaid enrollees is important for assessing the budgetary implications of both expansion and contraction in Medicaid enrollment. Despite the intense debate surrounding the Affordable Care Act (ACA), however, little information is available on the spending and utilization patterns of the nonelderly adult enrollees who became newly eligible for Medicaid under the ACA. Using data for 2012-14 from the Medical Expenditure Panel Survey, we compared health care spending and utilization of newly eligible Medicaid enrollees with those of nondisabled adults who were previously eligible and enrolled. We found that average monthly expenditures for newly eligible enrollees were $180-21 percent less than the $228 average for previously eligible enrollees. Utilization differences between these groups likely contributed to this differential.

A Physician's Perspective On Vertical Integration

Vertical integration has been a central feature of health care delivery system change for more than two decades. Recent studies have demonstrated that vertically integrated health care systems raise prices and costs without observable improvements in quality, despite many theoretical reasons why cost control and improved quality might occur. Less well studied is how physicians view their newfound partnerships with hospitals. In this article I review literature findings and other observations on five aspects of vertical integration that affect physicians in their professional and personal lives: patients' access to physicians, physician compensation, autonomy versus system support, medical professionalism and culture, and lifestyle. I conclude that the movement toward physicians' alignment with and employment in vertically integrated systems seems inexorable but that policy should not promote such integration either intentionally or inadvertently. Instead, policy should address the flaws in current payment approaches that reward high prices and excessive service use-outcomes that vertical integration currently produces.

Most Americans Have Good Health, Little Unmet Need, And Few Health Care Expenses

The distribution of health care expenditures remains highly concentrated, but most Americans use few health care resources and have low out-of-pocket spending. More than 93 percent of "low spenders" (those in the bottom half of the population) believe they have received all needed care in a timely manner. The low spending by the majority of the population has remained almost unchanged during the thirty-seven-year period examined.

Study Of Physician And Patient Communication Identifies Missed Opportunities To Help Reduce Patients' Out-Of-Pocket Spending

Some experts contend that requiring patients to pay out of pocket for a portion of their care will bring consumer discipline to health care markets. But are physicians prepared to help patients factor out-of-pocket expenses into medical decisions? In this qualitative study of audiorecorded clinical encounters, we identified physician behaviors that stand in the way of helping patients navigate out-of-pocket spending. Some behaviors reflected a failure to fully engage with patients' financial concerns, from never acknowledging such concerns to dismissing them too quickly. Other behaviors reflected a failure to resolve uncertainty about out-of-pocket expenses or reliance on temporary solutions without making long-term plans to reduce spending. Many of these failures resulted from systemic barriers to health care spending conversations, such as a lack of price transparency. For consumer health care markets to work as intended, physicians need to be prepared to help patients navigate out-of-pocket expenses when financial concerns arise during clinical encounters.

Retail Clinic Visits For Low-Acuity Conditions Increase Utilization And Spending

Retail clinics have been viewed by policy makers and insurers as a mechanism to decrease health care spending, by substituting less expensive clinic visits for more expensive emergency department or physician office visits. However, retail clinics may actually increase spending if they drive new health care utilization. To assess whether retail clinic visits represent new utilization or a substitute for more expensive care, we used insurance claims data from Aetna for the period 2010-12 to track utilization and spending for eleven low-acuity conditions. We found that 58 percent of retail clinic visits for low-acuity conditions represented new utilization and that retail clinic use was associated with a modest increase in spending, of $14 per person per year. These findings do not support the idea that retail clinics decrease health care spending.

Variation In Accountable Care Organization Spending And Sensitivity To Risk Adjustment: Implications For Benchmarking

Spending targets (or benchmarks) for accountable care organizations (ACOs) participating in the Medicare Shared Savings Program must be set carefully to encourage program participation while achieving fiscal goals and minimizing unintended consequences, such as penalizing ACOs for serving sicker patients. Recently proposed regulatory changes include measures to make benchmarks more similar for ACOs in the same area with different historical spending levels. We found that ACOs vary widely in how their spending levels compare with those of other local providers after standard case-mix adjustments. Additionally adjusting for survey measures of patient health meaningfully reduced the variation in differences between ACO spending and local average fee-for-service spending, but substantial variation remained, which suggests that differences in care efficiency between ACOs and local non-ACO providers vary widely. Accordingly, measures to equilibrate benchmarks between high- and low-spending ACOs--such as setting benchmarks to risk-adjusted average fee-for-service spending in an area--should be implemented gradually to maintain participation by ACOs with high spending. Use of survey information also could help mitigate perverse incentives for risk selection and upcoding and limit unintended consequences of new benchmarking methodologies for ACOs serving sicker patients.

The Medical Profession's Future: A Struggle Between Caring For Patients And Bottom-Line Pressures

In this issue of Health Affairs, Lawrence Casalino and coauthors establish that physicians in common specialty practices spend an average of 2.6 hours per week dealing with external quality measures. This gives rise to general questions about the future of the medical profession. To what extent will quality-tracking requirements and similar practice intrusions reshape who physicians are, how many physicians there are, and how they practice? In turn, how will these changes affect patients' access to care? Data derived from the 2014 Survey of America's Physicians: Practice Patterns and Perspectives, conducted by Merritt Hawkins on behalf of the Physicians Foundation, make it clear that physician practice patterns are evolving. Responding to an increasingly intrusive practice environment, physicians report that they will choose a variety of practice models likely to reduce patients' access to care or that they will retire early, which will exacerbate the physician shortage and fundamentally change the nature of the medical profession.