From HCI3 - Update from the Field

An update from Francois de Brantes, Executive Director at Health Care Incentives Improvement Institute, Inc.:

An apple a day keeps the doctor away....and if you don't want to eat apples, we'll force feed you - That's been the driving philosophy behind the "demand" side management by employers for decades. The focus on the demand side comes from the belief that third party administrators are managing the supply side and that "if only patients could comply with their doctor's recommendations, everything would be ok." Of course we all know that's a bunch of hooey, but it's easier to believe that than to face into the consequences of the truth. A few months ago, Penn State made headlines when it announced that employees would be compelled to fill out health risk appraisals and engage in a number of wellness programs. The penalty for non-compliance was steep and included higher premium contributions. The uproar from the faculty was deafening and resulted in the creation of a Task Force that would investigate Penn State's current health care benefits policies and compare them with other universities as well as market innovations. The result is a really good and thoughtful report that examines the management of both the supply side and the demand side and makes a series of observations and recommendations.

What this means to you - The most striking observations relate to supply side management and illustrate how little employers have kept their TPA's feet to the fire. Penn State's TPA engages in almost no value-based contracting, which means that healthcare services are paid fee-for-service, encouraging an over-production of services. In addition, the relationship between Penn State and the Hershey Health System offers little, if any, value and the Task Force recommends a thorough review of that relationship and its impact on employee health care costs. As a result of these "laissez-faire" supply side policies, Penn State's health care expenses have steadily and dramatically risen. The focused response on the demand side, while sensible in its design, was clearly ill conceived because it shifted a lot of burden on employees while leaving the providers free to do whatever they want. That makes absolutely no sense. Both sides have to be tackled simultaneously and yes, that's really hard. But the easy solutions and grandma sayings don't work, which forces all of us to face into the tasks at hand. For starters, as CPR and others have recommended, employers must set a far higher bar in selecting TPAs, and the driving criteria must be the percentage of payments that are made using contracts other than fee-for-service. That's because even if all employees ate apples every day, many will still get sick and need care. And ignoring supply side management will simply negate all the efforts of individual employees, whether voluntary or not.

New Report Card on State Price Transparency Laws, Regulations, and Websites Released

Forty-five states received a failing grade, only two received a B (Maine and Massachusetts), and no states earned an A, according to the second annual Report Card on State Price Transparency Laws developed by Catalyst for Payment Reform (CPR) and Health Care Incentives Improvement Institute (HCI3). The Report Card offers policymakers, consumer advocates, and other health care stakeholders a comprehensive state-by-state resource on consumer access to price information for health services. The grades are lower than in 2013 as this year’s Report Card no longer graded states only on the laws they have adopted to promote price transparency, but also on states’ price transparency regulations, price transparency websites (to the extent they exist), and all payer claims databases – the ideal source of data for these websites because they contain more accurate, complete price information. States that relied on all-payer claims databases as the source of price information for consumers received higher grades, as did states with adequate, fully operational, consumer friendly websites (mandated by law).

Some states have robust price transparency laws and regulations on the books, requiring them to create a publicly available website – but often the public can’t readily access price information because the website is poorly designed, or inadequately functioning. As an example, New Hampshire – a state that received an A in last year’s Report Card – received an F this year, because its website is inoperative and may remain so for an extended period.

To get a high score, a state needed to have both the “spirit of the law” – public access to a fully functioning website, and the “letter of the law” – robust legislation and regulations on the books ensuring the price information would remain accessible.

You can view the full report card here.

New resource offering quality, cost and safety information for consumers from HCI3

 The Health Care Incentives Improvement Institute (HCI3) created INQUIREhealthcare™, a new website and clinician search app offering objective medical quality, cost and safety information that’s easy for consumers to understand and use to make informed decisions regarding their care.

“Health care reform has been underway for some time and it’s appalling how painfully slow it’s been for so little progress,” said Francois de Brantes, HCI3 executive director. “For the status quo to change, it’s going to require pressure from consumers who aren’t happy with the current system. We’ve developed these resources to help patients join the fight and take an active role in bringing about meaningful change to the U.S. health care system.”

To encourage consumer involvement in reforming health care, the website will also serve as a community offering first-hand accounts from patients on how the health care system failed them and to share their stories. Additionally resources are available such as how to contact Congress to let them know you aren’t okay with the status quo, and how to become an INQUIRE ambassador to receive tools and personal support to help start grassroots movements in your local community to change the health care system as it stands today.

“For decades people have been saying patients are the most underused resource in medicine,” said patient engagement advocate and health policy adviser “e-Patient Dave” deBronkart. “A key factor is that we haven’t had access to useful information to make informed and empowered decisions. It’s estimated that consumers do ten times more research when choosing a TV than a doctor or hospital, as if it’s the patient’s fault – but the main reason has been the lack of cost and quality information needed to make choices. This new resource will be a big step in enabling consumer-patients, which will at long last let market forces reward great performers.”

90% of States Get Failing Grade for Making Available Consumer Information on Physician Quality

To shed light on the lack of availability of information for consumers on the quality of their doctors, a new scorecard finds the vast majority of states get a failing grade – D or F. Developed by the non-profit Health Care Incentives Improvement Institute (HCI3), the Transparency of Physician Quality Information report found that only two states received an A – Minnesota and Washington, and California got a C.

“We’re 15 years out from the Institute of Medicine’s trailblazing report calling for the transformation of a ‘fundamentally flawed’ health care system, and for the most part we still have no idea of the quality of care delivered by the majority of physicians in the U.S.,” said Francois de Brantes, HCI3 executive director. “That’s not just shameful, but it unnecessarily puts patients at risk. By highlighting states that are making a conscious effort to provide data to consumers, we hope to encourage others to embark on similar efforts.”

HCI3 graded the states around scoring criteria including the percentage of physicians and supporting health care professionals with publicly available quality information; the type of measurement provided (i.e. outcomes, process, patient experience); and the accessibility of the information.

This state by state scorecard highlights the extent to which there are still huge gaps in data and complements the State Scorecard on Price Transparency co-published by HCI3 and Catalyst for Payment Reform earlier this year showing the vast majority of states in the U.S. also get a failing grade in health care price transparency.

Read more here and view the full report online.

New CPR-HCI3 Paper Examines the Power of Coupling Reference Pricing With Bundled Payment

Pairing reference pricing and bundled payment together can be a potent strategy for purchasers and plans to reduce health care costs, while providing the right incentives and high-quality care to employees and members. Check out the new paper from Catalyst for Payment Reform and the Health Care Incentives Improvement Institute (HCI3) that details how to combine these two for maximum value.

Providers Are Preparing for Bundled Payments

This article from Hospital & Health Networks provides a summary of the issues surrounding the implementation of a bundled payment program including insights from a variety of specific health markets. Among the considerations hospitals and other providers must analyze when designing and testing bundled payments are: alignment of financial incentives, the need for and importance of data, and the importance of recognizing bundled payments require culture change. Also included are references to resources to be used in preparing for bundled payments, including materials created by the Health Care Incentives Improvement Institute (HCI3), and organization closely aligned with NBCH.  In addition, Booz & Co. has published a white paper describing the consumer perspective on bundled payments.

Why the U.S. health care system is failing us and how to change it

Here are two new books worth checking out...

Catastrophic Care: How American Health Care Killed My Father–and How We Can Fix It
David Goldhill, a member of the board of directors of The Leapfrog Group and president and CEO of GSN, has written a new book looking at our health care system and why it is failing, why expanding coverage will actually make things worse, and how our health care can be transformed into a transparent, affordable, successful system.

The Incentive Cure: The Real Relief for Health Care
Francois de Brantes, executive director of the Health Care Incentives Improvement Institute (HCI3), has just released a new eBook to shed light on one of the toughest issues facing our country, fiscally and socially, asking the critical questions about why patients often don’t get the right care, why America spends twice as much per person as the next biggest spender, and why the rules that apply to every other industry don’t apply to health care? The book also provides answers to many of the questions around why the U.S. health industry fails and highlights some of the most promising ideas for change.

New study finds significant and growing payment reform activity

Today's Health Affairs blog features a post from Dr. Michael Painter with the Robert Wood Johnson Foundation on how we can no longer rely on the way we predominantly pay for health care. It's also the introduction for the latest Health Care Incentives Improvement Institute (HCI3) Issue Brief on the results of a recent independent study on bundled payment efforts across the U.S.

Of the 19 studied bundled payment health care reimbursement implementation sites in process in the U.S., half are operational, and the remaining are continuing to progress in their implementations.

Conducted by Megan Burns and Michael Baillit, the report details the current real world state of bundled payments and examines how medical conditions are addressed, how bundles are defined, risk is distributed and payments are made.

Health Care Market Analysis Finds Pittsburgh Uses Substantially More Services, Resulting in Higher Costs to Employers

To provide its members with a baseline understanding of health care delivery and costs in the Pittsburgh region, the Pittsburgh Business Group on Health (PBGH), commissioned a health care market analysis that found the Pittsburgh region uses substantially more health care services, than comparative markets — Cleveland, St. Louis, and Cincinnati. As analyzed, the Pittsburgh region’s annual burden for additional hospitalizations was $187 million.

The Health Care Incentives Improvement Institute (HCI3) worked with PBGH to analyze the market comparison to better understand the relationship between the supply of hospital beds and the frequency of hospitalizations in the four comparable U.S. metropolitan areas. The findings and recommendations were released today in an HCI3 Issue Brief. The initial research was conducted by FORTE Information Resources.

“Due to the uncertainty of the changing landscape of health care, nationally and in the Pittsburgh region, and the potential impact this may have on employers’ benefits programs, it was critical to develop a baseline understanding of the delivery and cost of health care in our market,” said M. Christine Whipple, PBGH executive director. “It was equally important to determine if the cost and use of health care services is different, and if so, examine how and why. We found that the higher use of services in the Pittsburgh region is producing higher costs for health care. However, without knowing the actual payments to providers for health care services (and the link to the information), it is unclear just how much more employers, and their employees, are paying for health care in our region.”