Jeffrey Gene Kaplan, MD, MS

Welcome to Medical Economics' blog section 

which features contributions from members of the medical community. These blogs are an opportunity for bloggers to engage with readers about a topic that is top of mind, whether it is practice management, experiences with patients, the industry, medicine in general, or healthcare reform. The series continues with this blog by 

, MD, MS, a senior pediatrician and retired physician executive. The views expressed in these blogs are those of their respective contributors and do not represent the views of 

A critique of the role of an insurance company, payer, exchange or entitlement program

	Insurance companies are trying to be a gateway, but unfortunately, this may also mean they are not playing fairly and not covering what the patient needs. For example:

	·       We hear that Health Plan A refused to pay for a visit of a child with a probable goiter and strong family history of thyroid disease, a child who needed diagnostic lab tests. Why? They do not accept rule-outs. 

Analyzing the financial impact of the 2017 Obamacare market

	·       Not long ago, Health Plan B levied a $50 deductible and $25 co-pay for the most efficacious eardrop we have in our armamentarium. Reason? This drop contains an antibiotic and a steroid, the components of which are not available generically.

	Separating the mind from the body and spirit is antithetical to being holistic; it is piecework (where the incentive is to generate pieces)

	Holistic thinking is important whenever we review, judge or reward performance in any and all aspects of healthcare. As an example, deficient mental functioning and/or mental illness must be taken into account as management considers the cost, quality and/or outcomes of care.

No discrimination allowed if it discourages appropriate care

 coverage for mental health conditions than physical ones. 

	Nevertheless, insurers can still second guess practitioners and challenge payment for lack of “medical necessity.” This is shameful, especially if the patient is distracted or overwhelmed. But, be careful-such patients may be demanding treatment that is 

 indicated because of poly-pharmacy, black-box warnings on meds and the unpredictable nature of mental illness itself.

	Patients do not always know when they're not going to be able to cope and, by definition, they're unaware when on the slippery slope of a breakdown. Compounding this is the stigma of mental illness that itself contributes to delays in diagnosis and treatment.

Is Trump good for healthcare? Not so fast

	Enter managed care with its promises of behavioral medicine coverage, only to be followed by hurdles-denials and delays. [See: "

Battling for Health Coverage as Cancer Spreads

]. Think you can legislate fair treatment? Think again-adding insult to injury, insurers may require prior approval of pre-existing conditions and some services. Also, they can still charge consumers a lot for using out-of-network practitioners and facilities that are not on a very limited or restrictive preferred providers list.

Next: Insurance coverage is 'disgraceful'

	It is disgraceful that insurance coverage is often job-related and it is outrageous that the immoral disparity was ever allowed. (But, it has not been that long since those with mental illness were incarcerated as the mainstay of treatment. [Ref. Dorothea Dix's reform efforts in 1844]).

	The standards, guidelines and methods used to manage mental health benefits must be comparable to those for other medical care and cannot be applied more rigorously. Discrimination is manifest by bureaucratic under-handedness or procedural inequalities such as: setting separate or higher co-payments or deductibles, or applying stricter limits on the treatment of mental conditions, addiction disorders or physical illnesses.

	According to Robert Pear in his Jan. 29, 2010 

New Rules Promise Better Mental Health Coverage

" such disparities are, unfortunately, all too common in the insurance industry. However, removing such restrictions, doctors say the improved rules of practice and coverage will make it easier for people to obtain care for an expanded range of conditions, including, but not limited to depression, eating disorders, alcohol and substance abuse, autism and schizophrenia.

	When trying to improve outcomes and access while lowering costs, and with regard to pay-for-performance incentive programs and reward systems, the bio-psycho-social model is essential to use. Without it, care is likely to become fractionalized. [Reminds one of the parable of the elephant and the blind men.]

Do we have to make things more complicated than they already are?

	Consider the complexity of the U.S. healthcare system, which is made worse by becoming over-specialized, or even compartmentalized. For example, memory problems, dementia and psycho-social disturbances are issues that are or have been siloed from the rest of health care. Indeed, Michael Craig Miller, MD, points out that the following (independent variables, as it were), are rarely mentioned in the medical history, assessment or, for that matter, thinking: transience, absentmindedness, blocking, misattribution, suggestibility, bias and persistence.

	Medical management can ignore these contributing factors at their peril, leaving the whole process of paying for performance incomplete, misleading and otherwise problematic.

We invite comments, especially about comprehensive, responsible care and things that interfere with those objectives.

Articles

Insurance companies can be lousy advocates

Jeffrey Gene Kaplan, MD, MSIn terms of the ‘bang for the buck’-what one gets for the amount spent (read: invested), the United States pales in comparison to other countries. And, the disparities are particularly poignant when it comes to the egalitarian treatment of patients from all strata (in other words, universal accessibility), and best achievable heath status (i.e., benefit).

 for the ills of healthcare lies within our grasp. It’s called “managed care,” which simply means care that is efficient and effective. But, that 

 requires that one is able to use data analytics, which, in turn, relies on being able to answer the following three questions: In the health plan or system 1) What works? 2) What does not? 3) And, are patients getting what they need, i.e., the 

10 steps to reduce poor quality and unjustified care costs:

Foster teamwork, such as one can find in a group practice, accountable care or preferred provider organization in a medical home environment

. Ideally operating around a hospital or some such community resource, the team’s techniques and management strategies include peer review, aligned performance incentives (i.e., do things well and be recognized), communication and information sharing and a computer-assisted case management and accountability system that feeds 

public health and preventive medicine services

; make them available to entire populations based upon obvious and subtle needs, but within budgetary constraints.

	3)    Levy a modicum of insurance or taxation 

to raise awareness of the costs of care (to have ‘skin in the game,’ so to speak) when paying for some appropriate health services, applying these funds broadly across populations and longitudinally over time. (See #10, below)

 among patients, practitioners and/or systems of care, particularly for: adverse life-style choices for which there has not been substantive intervention; medical-surgical non-adherence; failure to cost-share and, thereby prevent inappropriate or unnecessary care; and failure to take into account non-prescriptive, readily accessible specialty society or peer-reviewed guidelines of care.

Why managed care is the best way to reform healthcare

, which can provide numerous benefits for patients, practitioners, and the healthcare system itself. Among these are: informed patients/consumers, greater adherence to orders and care process, better health outcomes, reduced variation in care and costs, and improved patient satisfaction

 between medical and community services. Improve medical education by strengthening the bio-psycho-social content of curriculum.  Also, increase the supply of primary care practitioners. 

 to ensure that everyone's on the same page with the objectives of providing efficient, effective, and accessible care. Speaking as a practitioner, I should be able to earn a premium based on how much I can improve a patient’s health. Should that fail, at least recognize my efforts and its quality.

Will insurers' doubts be Obamacare's unraveling?

	a)    The obverse is that there can be no incentives for over-utilizing-for instance, giving unnecessary antibiotics or shotgun, “blind alley” testing. Also, there can be no incentives for under-utilizing, such as from over-referral (i.e., dumping patients), delaying or cutting short physical therapy, patient education, mental healthcare, etc.).

	b)    Incentives should include, but not be limited to providing payment when established goals and objectives are met.

	c)    In other words, wherever possible, we should be aligning payment and quality in the interest of motivating improvement.

, especially as it pertains to systems improvement such as variance analysis, corrective action planning (CAP), timely feedback and monitoring.

Encouraging real, salutary quality improvement

. “It would be misleading to say that mere transparency had motivated surgeons, for instance, to make improvements that they would not have done otherwise. I believe that most if not all concerned professionals are interested in continuous quality improvement. Indeed, I have found that most practitioners will pick up on real or even putative deficiencies, learn from the introspection, and develop new techniques, improving what has to be improved, incrementally if necessary.” [Paraphrased]

Communicate results and close the feedback loop to practitioners about outcomes in real-time

 (i.e., at the point of contact with the patient and with believable data). For that, one needs 

, allowing "apples" to be compared to 'apples," rather than when "apples” were being compared to "oranges."

	10)Finally, to manage care, one needs a 

 – that is, all care over time, regardless of setting, the definition of a reliable type of observation -- an 'episode of care.'

	1. Sanders, D. “Cultural Principles and Patterns in Healthcare Analytics.”  (9/27/2012) with specific reference to Dell's "

	2. See Emily Oshima Lee, M.A., and Ezekiel J. Emanuel, M.D., Ph.D. "Shared Decision Making to Improve Care and Reduce Costs" 

The cure for the ills of healthcare lies within our grasp. It’s called “managed care,” which simply means care that is efficient and effective.

10 tips to reduce poor quality healthcare, unjustified care costs

which features contributions from members of the medical community. These blogs are an opportunity for bloggers to engage with readers about a topic that is top of mind, whether it is practice management, experiences with patients, the industry, medicine in general, or healthcare reform. The series continues with this blog by 

Jeffrey Gene Kaplan, MD, MSI am frustrated with the unprecedented amount of money being spent on healthcare in the United States, particularly since, compared to most other nations, we do not have better results from this “would-be investment.” 

	In other words, we’re wasting our money and I say this, for the most part, regardless of the medical or surgical condition.  For example, given the acuity or case mix, compare the cost of dental or surgical care in Mexico or Europe to getting the same service in the United States.

Young doctors are jumping ship to non-clinical roles

	Nevertheless, the skeptics will say our care is better. Is it?  To answer that question, we need to look at all the costs, determine the quality of care, acuity-adjust the benefit, if any (i.e., the outcomes) and verify that there are no problems with access. [These three parameters-cost, technical and perceived quality and access will neatly come together in my definition of “value,” below.]

	Obviously, the challenge in medical management is to get the costs down without compromising access and to get the quality up. 

	One of the things insurance companies like to do is charge out-of- pocket fees for some recommended care through the use of co-pays, deductibles, multi-tiered pharmacy benefits, etc. This is done in the hopes that patients will thereby become more judicious in the menu of procedures, tests, admissions, referrals and so forth that are put before them in their hour of need. [As if they can “choose”?]

Lost in translation: The physician-caregiver relationship

	It has been my experience that this cost sharing can quickly become a veritable barrier to appropriate access. In other words, in my role as health plan medical director, I always had to ascertain that the patients were not being dissuaded from getting the care that they actually needed.

	At the same time, I had to be wary of CYA medicine where every test in the book is ordered, willy-nilly. Inappropriate charges, barriers to access, overutilization, mindless medicine, can all contribute to the costs of care without improving value.

	Let’s examine quality by looking at a particular indicator of hospital quality-identifying potentially preventable hospital readmissions. This is an important, common and accessible litmus test of healthcare quality and efficiency, but it fails to address 

 the issues in the continuum of care. For example, patients can be readmitted for other than clinical reasons such as unaddressed social factors; specialists may not communicate with other specialists or primary care practitioners; a lab test may go unnoticed; there’s always the insidious bureaucratic delay to contend with; there may be hidden diagnoses such as substance abuse, drug-drug interaction, etc.

	Anyway, why choose “readmissions” as a critical indicator?  Simply because it obeys 

 (Why rob banks? Because that’s where the money is!) 

	Hospital readmission rates are low-hanging fruit when it comes to evaluating the value of key components of care. If you are a healthcare director, manager or simply an interested party, however, will you put 

 an indicator of quality of care is readmissions?

	A study comparing 2009 and 2011 hospital readmission rates for MI's showed that they ranged from 15% to 26%. But there was a statistical observation-only 1.7 percentage points separated the bottom from the top quartile ranking hospitals’ performance. [Read: 

	The authors also scrutinized the relationship between readmission rates and several commonly-used hospital quality indicators, including “risk-standardized mortality rates, volume, teaching status, and process-measure[d] performance.”

	A strange finding emerged when the data were analyzed in this study: while rankings fluctuated, readmission rates for lower-performing hospitals in 2009 tended to 

 by 2011, and the obverse-at the very same time, readmission rates for higher-performing hospitals tended to 

. In fact, the investigators found that “readmission rates were higher in teaching hospitals and were weakly correlated with the other indicators of hospital quality.”

Next: Translating data into information about value

Translating Data Into Information About Value

	When looking at quality, accessibility and cost, hospital readmissions are a convenient place to start, but they are insufficient for defining value.

	It is common to have “value*” expressed as a simple relationship of “quality” to “cost,” but it is not that simple.

	When attempting to manage care more effectively and efficiently, one has to consider the continuum of care, the past medical history, the history of present illness, socio-economic factors, genomics, the relevant specialty guidelines, compliance or adherence rates, and so forth.

	These aspects of care are data, hard to computerize but coming to the medical manager, actuaries and policy makers. If applied correctly, this new information will lead to a more accountable healthcare system. 

” –one that incorporates the notion of “accessibility.” 

	To better understand our evolving information technology as it applies to medical management, let me recapture some exciting developments,

	I had a discussion a few years ago with John Eisenhandler, Ph.D. of 3M Health Information Systems in Wallingford, Ct. about economic incentives and how to operationalize comparative effectiveness research. It is remarkable how sophisticated 3M is about what I call “measurement and management.”

	The link at the end of this article, goes into greater depth on “Planning, Budgeting and Controlling – One Look at the Future:  Case-Mix Costs Accounting.”  See it to look at identifying preventable readmissions using what should be readily available data; hone in on a methodology to look at outcomes-heart failure, in particular; and, check out Richard Averill of 3M’s comments about re-hospitalizations among Medicare fee-for-service patients.

	For more on the state-of-the-art of marketplace logistics, economic incentives, ways to improve quality across and between settings, comparative effectiveness and cost-effectiveness analyses, care-coordination, case-mix (acuity) adjusted data, episodes of care, etc. see 

Efforts That Reduce Preventable Readmissions

"Predicting and Preventing Readmissions."

Please share your thoughts and/or frustrations with potentially preventable readmissions.

	· Basic awareness of Evidence-Based Medicine and Medical Necessity criteria

	· Reducing variation, a key concept of quality assurance

	· Ensuring proper reimbursement for rendered, appropriate care

	· How to maximize revenue and decrease claim denials

Limits Of Readmission Rates In Measuring Hospital Quality Suggest The Need For Added Metrics

I am frustrated with the unprecedented amount of money being spent on healthcare in the United States, particularly since, compared to most other nations, we do not have better results from this “would-be investment.”

Author | Jeffrey Gene Kaplan, MD, MS

Articles

Insurance companies can be lousy advocates

10 tips to reduce poor quality healthcare, unjustified care costs

Why are we wasting money on healthcare with poor outcomes?