Monday, April 20, 2015

BCBS Michigan study touts PCMH savings which are small, but doesn’t include all costs.

Today’s Managing Health Care Costs Number is 1.1%

This is a review of the second of three articles about payment reform that are in the April issue of Health Affairs.   Each proclaims success at lowering cost and improving value, and I’m evaluating them using criteria I laid out last week.

Blue Cross Blue Shield of Michigan established a patient centered medical home program (PCMH) for its primary care physicians – over time about 2/3 participated.   The plan measured costs and quality changes of the early and the later adopters of PCMH compared to the results of the population that never adopted PCMH.   

The study is big (over 3 million members with 12 months of continuous enrollment), though it is not long-term.   The study included all medical costs, so there was no cherry-picking of certain claims lines that went down.  The researchers applied a risk adjustment to account for known demographic or severity differences between assessed groups.  

Note this was a study performed on a PPO style health plan, so members were attributed retrospectively to each primary care group.  

The researchers found that costs grew more slowly ($4.00 pmpm) in the early participant group compared to the nonparticipant group. However, groups’ costs increased by more than this ($5.95 pmpm) in the year they transitioned into the PCMH program.   Higher initial costs for PCMH programs are consistent with other published accounts.   The study showed no inpatient savings – only savings in outpatient and professional costs.  This differs from other published accounts.   It’s good the researchers shared this subanalysis, although it would better sense for PCMH to prevent hospitalizations than to prevent ambulatory care expenses.  The researchers do not report on pharmaceutical costs, which is unfortunate as we’d expect this line item to go up with increased adherence.

The researchers did not account for the cost of administering the program –and did not account for the cost of bonuses given to participating groups that met performance standards. This is a huge deal – the BCBS Massachusetts “Alternative Quality Contract” studies initially reported only on claims costs and showed savings, but only had “all in” annual savings in the fourth year after accounting for payments to providers that were not based on fee for service.   We simply have no idea whether Blue Cross Blue Shield of Michigan actually saved money in this program – it’s not likely, as bonuses were up to 20% of PCP fees.  

On the quality side, the researchers have shown an impressive statistical difference between participating groups and nonparticipating groups – but that difference seems pretty stable pre and post intervention.  In fact, preventive screening rates went down in 5 of the 14 measures reported.  It’s hard for me to conclude that this program led to higher quality – it appears to me that it merely segmented the practices that had processes in place at the outset to lead to higher rates of various preventive services.  

Thursday, April 16, 2015

Cataract Routine PreOp Testing Won't Go Away

Today’s Managing Health Care Costs Number is 53%

Today’s New England Journal has a review of Medicare claims data from 440,000 Medicare beneficiaries who had cataract surgery in 20 that shows that 53% of patients getting cataract surgery get preoperative testing. The authors state that the likelihood that patients have preoperative testing hasn’t decreased since the American Academy of Ophthalmology and other specialty societies recommended against such testing for healthy patients in 2002. Patients got tested based on their surgeon – not their level of illness burden, their age, or the site of the procedure.

It’s easy to disseminate guidelines for a new high margin service – it’s hard to effectively implement guidelines that tell us to do less.  The authors conclude:   These data underscore the fact that publishing evidence-based guidelines alone does not necessarily change individual physician behavior. 

I’ll  be back to the Health Affairs articles on provider payment reform with my next post.

Wednesday, April 15, 2015

Geisinger Study of PCMH Savings - Can't Tell ROI and Can't Apply to non-Medicare Populations

Today’s Managing Health Care Costs Number is $53

This is a review of the first of three articles in this  month’s Health Affairs on savings from provider payment initiatives.

Geisinger Health reports on experience of its patient centered medical home since 2006.    The PCMH program has been rolled out in waves, so researchers compared the regression-adjusted costs of practices that had already implemented PCMH with those that had not.

The research was limited to those who were Medicare eligible and were enrolled in a Geisinger health plan which required designating a primary care physician.   This meant that about 1/3 of each practice’s Medicare patients were included in the evaluation.   The evaluation was done by practice, which represented the “team” nature of the PCMH, rather than by individual patient.

The study was big – 3 million “life months” and over 6400 site months. 

The results showed   a cost savings of 7.9%, including a 19% drop in the cost of inpatient care.  The inpatient calculated savings represented about 2/3 of the total cost savings, and practices which had been in PCMH longer had lower costs.

The researchers recognized that the sites were fundamentally different For instance, the practices that were in PCMH were bigger and had more patients who had Medicare Part D through the Geisinger Health Plan.  They also had more asthma – the other illnesses appear close to equal, although no “p” values are given.  The researchers say that they’ve accounted for these differences using multivariate regression analysis – and they have used the same analysis to set the exposure to PCMH to zero to calculate the cost of care if PCMH had not been implemented.

The researchers have not accounted for the incremental cost of the PCMH intervention itself,    They say that they had no access to this information, although the study was performed by Geisinger researchers who presumably could have gained access to estimates of the cost of the intervention.

The unadjusted cost of care was substantially higher ($869 vs. $735 pmpm) for the sites with PCMH, but after adjustment by the regression analysis the expected cost was $670 and the adjusted observed cost was $617 – a $53 savings.

The researchers say that there was no “cost shifting, noting approvingly that costs went down in all areas,   I expect costs to go up in pharmacy or ambulatory professional services, but perhaps the increased costs are simply not captured because the PCMH intervention itself is not associated with any cost. 

The graphic above evaluates the article based on  the standards I noted in my last post:

Monday, April 13, 2015

Evaluating Reports of Savings from New Provider Payment Models

Today’s Managing Health Care Costs Number is 3

This month’s Health Affairs has three articles trumpeting the effectiveness of provider payment interventions in improving the quality and cost of medical care.  This includes a report from Geisinger on cost savings from its patient-centered medical home program for Medicare beneficiaries, a report on care management done in the Washington state on high risk Medicaid beneficiaries, and a report from BCBS of Michigan on impact of its physician pay for performance program.

I’ll review these over the next few days.  First, here’s a framework for evaluation of provider payment interventions.  

1.     Have the researchers explicitly stated the cost of the intervention?  It’s great to save $5 million; less great if the cost of the program is $10 million! 

2.     What is the comparison group?  Provider practices which voluntarily enroll early in alternative payment arrangements tend to be systematically different than the provider groups which continue in legacy fee for service arrangements. 

3.     How big is the study?   Small studies tend to have large confidence intervals – and should always be confirmed by larger studies.   Smaller studies are also more subject to the influence of a single charismatic effective leader, and thus less likely to be scalable.

4.     Does the researcher report on all expenses, or just a subset? You’d expect that certain costs (primary care office visits, pharmacy) would go up with better management; it’s suspicious when only cherry-picked categories are reported, or when all actuarial categories show lower costs.

5.     What’s the population?   Be careful about extrapolating savings opportunities in the Medicare or dual eligible Medicare/Medicaid population to the commercial (under 65 employer-insured) population.   There are a lot of inpatient and skilled nursing costs and end-of-life costs in the Medicare population; not so in the commercial population.

Saving medical costs is hard – and the triple aim of saving costs while improving population health 
and patient experience is harder still.   It’s great to see so much effort at both implementing AND measuring changes in provider payment.

We should also recognize that publication bias is rife in the health policy world.  Health care organizations rarely publish reports that don’t show the success of their efforts.

ADDENDUM: I'll add one more criterion (4-15-15):

6. Are the researchers independent?  Best that at least some of the researchers are academics not affiliated with the organization reporting the results.   Publication bias is a huge problem, and involving outside independent researchers can make it more likely that negative results would be reported. 

Friday, April 10, 2015

The High Cost of False Positive Mammograms

Today’s Managing Health Care Costs Number is $4 billion

This month’s Health Affairs has an article demonstrating the costs of false positive mammograms in women from 40-59.   The researchers used claims data to show the cost of each false positive, and to estimate the likelihood of a false positive. They calculated national costs at $4 billion by multiplying their findings by national mammography rates.

This is a study based on insurance claims– so it’s not precise.   Some women might have had their final diagnostic test more than 12 months after the initial positive mammogram – and thus been incorrectly labeled as false positives.  The rate of ductal in situ positives is lower than other studies, which could have incorrectly reduced the national cost estimate.

Mammograms save lives – but false positive mammograms are common – and women getting annual screening for a decade have as much as a 61% chance of a false positive during that time period.

Estimates of financial cost also miss the enormous human cost of false positives.  This ranges from worry before a followup mammogram to months of chemotherapy that wasn't really needed.

This study reinforces the importance of moving toward the US Preventive Services Task Force (USPSTF) recommendations of mammography starting at 50 (not 40) for low risk women, and mammography performed every other year rather than annually.   Reducing mammography screening doesn’t apply to women with positive family histories,  certain genetic abnormalities, personal history of breast cancer,  or worrisome physical findings.

We eventually need to migrate to individualized screening recommendations. Women with a high pre-test probability should have more frequent screening; women with low pre-test probability should have less frequent screening.  This would dramatically lower the false positive rate for mammography, and reduce the financial and human costs of false positive screening mammograms.

Wednesday, April 8, 2015

Annual Preventive Visits are Low Value Medicine

Today’s Managing Health Care Costs Number is $10 billion

National Public Radio and Kaiser Health News had reports on Monday reporting once again that the “Annual Physical Exam” is costly and not based on high quality evidence.   There’s a world of anecdotal evidence that these exams can be helpful  (“My doctor found my melanoma, and now I’m alive!”) – but meta analyses of published studies show no benefit of annual exams.   

Ateev Mehrotra of RAND says that the annual cost of preventive medical exams is $10 billion –but that doesn’t capture the entire cost of these exams.  Costs that are not included in this analysis include:
·         Costs of followup tests or therapies based on false positive tests ordered as part of the physical examination
·         Patient opportunity cost to go to these visits.
·         Primary care offices are clogged with these low value visits- and unable to offer good access for urgent issues, leading to more emergency department visits.

We’ve been talking about the fact that annual preventive exams add little value for some time – I’ve blogged on this here and here in recent months.  Of course, the Affordable Care Act mandated coverage of these visits with no cost sharing.  

Some of the putative advantages of annual preventive visits have diminished recently, so I expect the prevalence of these visits will decrease in the coming years.

·         Pap smears are recommended only every 3-5 years from age 21 to menopause – as opposed to annually
·         Mobile apps can increasingly provide information to patients about recommended preventive care.   See the AHRQ calculator and app here.
·         Retail clinics and pharmacies can offer convenient immunizations  - and could do periodic screening tests like cholesterol profiles to the extent these are clinically recommended.
·         Biometric devices connected to smart phones can report on blood pressures and other vital signs; they can even do electrocardiograms (although these are not recommended in healthy people with no symptoms)

In the meantime, I’m grateful that my primary care doctor will talk to me about my cholesterol profile via secure email, and I’m going to keep on ignoring that reminder that I am “overdue for my preventive health visit.”

Monday, April 6, 2015

New York City Grabs Credit for Lower Health Care Costs

Today’s Managing Health Care Costs Number is $3.4 Billion

New York City made the Wall Street Journal late last week with reports that the de Blasio administration identified $3.5 billion in medical cost savings over the next 4 years.   This is big – the total NYC health benefits budget increased from $2.6 billion in 2005 to $5.3 billion in 2015, and NYC provides health insurance for 350,000 employees and their families. 

Let’s look at the breakdown of that $3.5 Billion, from the Mayor’s office press release:

FY 2015: $400 million
·         Moving away from “fully insured” : $58 million
·         Decreased payments to one health insurer $4 million
·         Savings from audits that remove ineligible dependents: $108 million
·         Decreased payments to a mental health parity fund: $153 million
·         Better care management and some prior authorization  $15 million
·         Specialty drug savings $7 million
·         Lower trend in one insurance plan: $17 million
·         Lower trend in senior care plan $58 million

FY 2016: $700 million
·         Care management savings will increase to $50 million
FY 2017: $1 Billion
FY 2018; $1.3 Billion
·         Note that over $400 million of the FY 2018 projected  savings are related to decrease in projected trend from 9% to under 3%

It’s a big accomplishment to be able to announce cost savings in health care that management (City Hall) and labor (unions) can agree about. Cutbacks in health care coverage are a major source of labor management strife, and when de Blasio took office,  there were no union contracts that had been fully negotiated. 

 But the only places here that there are actually fewer services being delivered as a result of this agreement are “care management” and possibly specialty drugs.  Together, they represent 6% of the total savings claimed.  Additional care management changes that improve the care of diabetics and 
decrease emergency department use are projected by 2018. 

The other savings New York City announced are administrative (moving away from fully insured and lowering payments to a joint city-union fund) or grabbing credit for savings from lower trends that we are seeing across the market.