Managed Care: Where To Now?
Health insurance plans have been around for a long time, most date them to the early 1850s in England and to a few years later in the United States. They remained more or less miniscule for decades, then started to find small pockets of interest in the 1920s - but didn’t enjoy real growth until the 1930s, when the non-profit Blue Cross/Blue Shield group plans were introduced. BC/BS was a boon to depression-plagued patients, doctors and hospitals - putting a cap on costs for families, assuring enough patient volume for hospitals and guaranteeing prompt payment to doctors. All with minimum-necessary oversight.
Managed Care came into being in 1973 when Congress passed the Health Maintenance Organization Act, promising the delivery of a higher level of medical service at lower cost. By that decade’s end there were 200 HMOs operating in 37 states. But ten years after that, what started out with the promise to deliver a friendly and better level of care at a lower cost was the subject of widespread patient and physician complaints.
Soon HMO basic-plan enrollment went down sharply while membership in “hybrid” (and more-expensive) PPO plans rose rapidly. According to a recent Kaiser Family Foundation study, HMO enrollment currently accounts for only 25% of the market - PPOs account for a bit over 55% - and POS plans cover another 15%.
Now the industry finally seems to be looking for real answers to its many patient care and public relations problems. A panel of experts at this spring’s National Managed Care Congress even discussed the quite-possible demise of the HMOs as we know them. One speaker loudly, clearly and squarely placed most of the blame for such an eventuality on the people in the room, including himself.
Many of the speakers also said that patients’ demands for more-compassionate service and increased choice simply can’t be “papered over” any longer. But the old ways are hard to leave behind and when it came to specifics, the most-concrete “turnaround” solution was a planned rating system for physicians. It projected that by 2010 the industry will be able to evaluate every aspect of physician performance...thereafter reimbursing practitioners in accordance with their ratings.
Thinking like this of course is not too popular with the AMA, which is in the initial stages of its own plan - the development of a series of principles to allow physicians to instead evaluate the performance of insurers, based on their reasonableness, cooperation and fairness of payment.
Small chance that either side will get all it wants. But just possibly there may be real and growing understanding among many insurers that it is always good business to try to deal with satisfied and friendly people, rather than with antagonists. Local case in point is the recent introduction of a major ad campaign for New Jersey’s “blue” that promised a “ - simpler, more common sense approach to health care” including an automated program that calls patients at home to remind them of needed health screenings. Possibly more dramatic is the formation last year of a new company called “Revolution” -- the brainchild of AOL’s former chairman -- which says it is much-interested in developing new approaches to healthcare delivery. It is scheduled to offer specifics about now. (See lead item, back page.)
Trouble Next Door
New Jersey hospitals, of course, have their problems; but a look across the river can quickly make us very happy with our lot.
Twelve New York State hospitals have closed in little more than two years, while many others have had to shut wings and services. World-class institutions like Mount Sinai and St. Vincent’s report sharp and continuing losses. And just north of the city, once constantly-enlarging Westchester Medical Center is apparently in need of immediate financial aid. Today, both the state’s and the city’s hospitals are struggling with a total of $15 billion dollars in long-term debt, with all-too-little chance of reducing that figure in the foreseeable future.
On the other hand, New York-Presbyterian Hospital is currently in good standing among the best the city has to offer - but only after years of struggling through the troubled marriage of the two much-respected Ivy league institutions that joined because they could not financially subsist alone. According to a report from its health department, New York state lost 20,000 hospital beds in the past fifteen years and just may lose another 20,000 in the coming years. They will be missed on the various local levels, but fact is that, based on population, the state has 20% more hospital beds per person than the national average.
The political infighting about which hospitals will close and which will remain is a now-constant battle. To originally forestall feared closings, administrators at many medical centers opted to add new wings of specialization. Problem was that too many wings were opened, each competing with other hospitals. Often the result was simply more red ink.
Another major cause of this financial woe is New York’s proud and centuries-old tradition of medical care for those unable to pay for the services they often desperately needed. For example, there are a dozen city hospitals in metropolitan New York City and an uncounted number of clinics, all targeted to serving the poor. In second place nationally is Los Angeles county, which has four county hospitals covering a much larger area and many more people.
Most of the state and city politicians blame the advent of managed care for at least part of the problem. With too-little income at just about every hospital, the competition for managed care’s dollars immediately became intense. Contracts were signed because contracts were needed, but they were often signed at too-low rates that only lead to further financial problems.
Today, hospital administrators across New York State say they are united in a desire for greater financial efficiency. They face an admittedly uphill battle.
Introducing Patients to Generics
In less than two years, a drug dispenser that on average contains professional samples of up to twenty generic drugs has been installed by managed care plans in approximately 50 medical offices in New Jersey, Pennsylvania, California and Oregon. The plan’s purpose is to reduce costs by getting patients to start off and stay on generics whenever possible.
The dispenser -- which on average offers twenty medications -- is about the size of a large filing cabinet and is connected to a central computer monitoring system at the plan’s offices.
The doctor enters a code, selects a bar-coded drug by name and the sample -- up to 30-day supply -- pops out, along with patient information. The machines are restocked and serviced by the developer, MedVantex. The company claims that the overall generic prescribing rate by participating physicians has risen between 3% and 5% overall, with the figure over 10% increase in certain classes of drugs.
MedVantex is reportedly talking to insurers in a number of states, obviously hoping to expand the generic dispenser’s reach.
New Heart Healers
Inventions never even imagined just a few years ago are at work today in select heart failure cases and promise to be more-widely used in the next few years. Just in time, too, because currently five million Americans suffer from congestive heart failure and the number is growing at the rate of 550,000 new cases diagnosed each year. Some anticipate that the number of heart failure patients will reach 45 million worldwide by 2010.
First is a device, the Tandum Heart, which received FDA approval about two years ago. In effect it is a simplified version of complex heart-lung machine and designed for use when operating on the most-seriously ill patients suffering from the clogged arteries that lead to heart failure. Major -- and quite amazing -- advantage is that it eliminates the need to open the patient’s chest; which in turn eliminates a good deal of bodily trauma to the most-seriously ill.
Instead, the Tandum Heart -- an artificial pump that works outside the body -- is able to take over up to 85% of the heart’s pumping action over the period of the operation. A tube is placed in the large vein of the patient’s leg and oxygen-rich blood is withdrawn from the heart’s left atrium and returned through the large artery. Another plus - the procedure is usually performed in a cardiac cath lab rather than in an operating room.
A lot more work than it seems and much more difficult than standard procedures, but life-savers for patients whose body simply can’t stand up to the more-invasive “normal” procedure. It comes at a high price, though, as much as $40,000.
The second breakthrough is quite different, but just as amazing. Bioheart is a small but rapidly-emerging company tucked away close to famed “Alligator Alley” in southern Florida. Target patients are much the same, but this approach is far different; their developmental work is esoteric, dedicated to helping the heart heal itself by replacing damaged cells with new growth. Its goal is to sharply reduce most heart transplants - the need for pacemakers - perhaps even much current medication. And to reduce current mortality rates while doing it. The company is rather close-mouthed about the bioengineering it will use to do all this, but reports it is currently in advanced clinical trials in Europe and hopes for FDA product approval by 2007.
And they have already impressed some pretty-tough investors. Bioheart has raised over $40 million start-up funds from a division of Johnson & Johnson...St. Jude Medical...and several other medical service and supply companies.
Nowhere to Hide
Conflicting healthcare insurance stories -- both bad -- coming in from California, where so many problems and solutions often begin. On one side, moderate-wage employees complaining about constantly-increasing co-pays demanded by their employers who in turn claim they themselves are strapped and just can’t afford to pay a greater share. On the other side are self-employed who give up their dream...and go to work for a corporation simply because they can’t afford huge personal healthcare premiums.
According to Families USA - between 2000 and 2004, the number of workers claiming to spend more than 25% of their wages on healthcare increased sharply and now stands at 14.3%. According to the Kaiser Family Foundation, health premiums rose 59% during the same period and now average 12.4% of employees’ earnings. A recent survey found that 17% of Californians could not pay one or more medical bills in 2004.
Across the nation, just a surprisingly-small number of companies apparently are still able to pay for full employee healthcare benefits. They are grouped in the auto industry, telecommunications, the sharply-reduced steel industry and in some -- not all! -- state governments. And every economist expects that number to drop when new employee contracts are reached. Meanwhile, several HMOs are now initiating deductibles and co-pays for hospital care.
Economists talk about more people reaching the “tipping point”
- the cost-of-care level where people have to choose between healthcare and a reduction in their established standard of living. Many feel angry because they feel it is unfairly happening to them due to no fault of their own. Others seem eager to accept a Canadian form of healthcare-for-all, ignoring the dire reports of long lines and sharply-reduced care being reported from the north.
Most of the advocacy groups admit that if there is an answer, it certainly is elusive - as expensive modern marvels of medical care keep getting invented and discovered, which in turn leads most of us to longer and hopefully-happier lives. That we don’t seem able to afford!
Meeting the 1:5 Ratio
Also in California. In 1999 the state passed a 1:6 nurse-to- patient ratio, which took effect last year and was automatically reduced to 1:5 in 2005. Hospitals are reportedly scrambling to comply, complaining they are caught in the continued midst of a huge nationwide nursing shortage.
Several states have mandatory staff-patient ratios in certain areas such as intensive care; only California has a ratio require- ment in all areas. Most California hospitals complain that the requirements are impossible to live up to simply because there obviously are not enough nurses to fill the bill even with using outside agencies and increasing staff hours.
Result is that hospitals are closing beds and moving patients from overcrowded areas. One imaginative idea suggested is to have nurses take “working lunches” in a room that enables them to monitor patients while eating; this apparently wasn’t looked on with favor by any of the parties involved.
The good news for the hospitals is that the state law carries no fines or special punishments for those unable to meet the exact requirements of these new rules...as long as they show the effort to comply.
You Decide!
Hate to take issue with a prestigious periodical such as the Archives of Internal Medicine, but there is no choice.
A recent article presented a study of newspaper ads from some of the most-respected medical centers in America. Johns Hopkins...Mass General - University of Chicago Hospitals - .and others that were listed in the 2002 U. S. News and World Report annual “Honor Roll” of the best-of-the-best.
A study group analyzed 122 ads designed to present each hospital’s ability to offer exceptional care. The panel compared claims made by these hospitals to those that have been found often-wanting by the pharmaceutical companies, that they said made it a practice to gloss over a product’s possible negative effect on any one patient.
The panel pointed out that 62% of the hospital ads presented “emotional appeals” and 35% featured the med center’s advanced technology. What was missing, thought these experts, was a presentation of the admittedly-rare problems that can arise in any care. In other words, look for possible bad things to advertise about.
A spokesperson for the American Hospital Association quickly took issue with most of the complaints in the article, saying that advertising has become a necessity for both large and small hospitals - that emotional appeals were standard fare in all manner of advertising - and that the excellence of care in America’s hospitals is acknowledged worldwide.
Unfair criticism by a panel almost-desperately searching for a headline-maker? You decide; though we feel the answer seems all-too-obvious.
CMS to Test e-Prescribing
A pilot program to test emerging, innovative and new methods of electronic prescribing is currently soliciting the participation of groups interested in what the feds obviously believe is an important element in healthcare’s electronic future. It all will coincide as much as possible with Medicare’s prescription drug benefit plan, which will take effect in January of 2006.
The actual standards to be tested will be announced by CMS in September and the pilot projects will begin early in 2006. Conclusions reached from these projects are scheduled to be released in the spring of 2007, with uniform standards for e-prescribing put in place the following year.
Current thinking is that these standards will be designed to cover various “transactions” between doctors and prescription dispensers - and will also clearly identify all aspects of eligibility and benefits available to individual patients.
- ....Marginal note: a recent research report concluded that physicians seem to be growing more comfortable using infor- mation technology in their practices. The researchers estimated that the number of “IT-friendly” physicians has multiplied more that three times since 2002 and currently stands at over 380,000.
UK Setting the Pace
British hospitals are taking major steps to fully enter the electronic age; able to do it all at once because of provisions of their National Health System. GE and EMC have joined forces to win a $200 million contract to install electronic image archiving systems in 70 hospitals of the country’s giant southern district; hopefully taking a major step in centralizing communi- cations and modernizing technology within a system that has been pilloried for being slow to react and too-far behind in technology and service to patients.
All this reportedly is only a small step in the proposed up to $18 billion system-wide upgrade that is designed to centralize patient records, data and imaging in a single location which can then be accessed anywhere in the island nation in seconds.
Backbone of this technology is GE’s picture archiving and communication system (PACS) that allows MRIs, x-rays and related medical imaging to be digitized, stored and transmitted electronically - eliminating film development processes and effectively hand delivery to physicians.
Previously two other area large healthcare upgrade contracts have been awarded to IBM and several other giant IT healthcare suppliers. A British spokesman said that, when in place, all these integrated systems should become a worldwide standard for IT patient care.
Coding Tips
The new respiratory guidelines which clarify certain coding issues have been released. There is a definition of acute exacerbation which means a worsening or decompensation of a chronic condition.
What is clarified is what to do when you have two conditions within the same subcategory. When the physician documents acute exacerbation of asthma and status asthmaticus, which code should be coded? The guidelines state it is inappropriate to code both and only status asthmaticus should be assigned.
When the physician documents coding acute exacerbation of COPD and COPD with acute bronchitis it is inappropriate to code both conditions. The guidelines state the only code that should be assigned is 491.22. These guidelines available on the web at the following link should clear up some of the confusion:
www.cdc.gov/nchs/datawh/ftpserv/ftpicd9/ftpicd9.htm
Transcriptions Tips
Hearing and vestibular function can be screened during a neurologic examination using the following tests. Note that the ALL of these are capitalized as they are Eponyms:
Rinne test: Vibrating tuning fork is placed on the mastoid process of the temporal bone and gradually moved away; when bone conduction is greater than air conduction, it indicates conductive hearing loss, if air is greater than bone conduction, it indicates sensorineural hearing loss.
Weber test: Vibrating tuning fork is placed on the vertex or forehead; if sound is heard in the affected ear, impairment is probably conductive type and if heard in the normal ear, impairment is probably of the sensorineural type.
Valsalva maneuver: After deep inspiration, mouth and nose are held tightly closed and a strong attempt at expiration is made. Used to test mobility of the tympanic membrane.
Medical Minutia
In case you haven’t heard this a dozen times before - .the common cold is not at all common. The associate chief of clinical infectious diseases at the University of Texas/South- western Medical center reports there are more than 200 separate and quite-different viruses known to cause colds.
Seems that old saying that a cold is contagious only before symptoms appear is true, too. Depending on the virus strain, a person generally can become contagious about a day after infection - which sadly is one to two days before their own symptoms appear. And patients generally remain contagious about three days after they seem to have recovered.
Bottom line - there is really no way to escape!
If you are planning to visit Caesar’s Atlantic City for the NJHIMA Annual Meeting (June 23-24)...please also plan to visit NJPR at booth 304. There is a chance for you to win a $100 prize.
NJHIMA Annual meeting offers exciting General and Concurrent sessions and an exhibit hall. Hope you are able to attend.
Auditing the News
Steve Case, the founder and former chairman of AOL, is looking for a number of new IT fields to conquer - and healthcare seems near the top of his list. In the past year he has formed and reportedly invested $500 million in a multi-faceted company named “Revolution”. First step was the purchase of a TV and radio network that offers health and wellness programs over cable and satellite. But that apparently is just a small beginning.
Revolution’s web site stresses that healthcare represents 20% of the U. S. economy and that they are developing the “ - first comprehensive, consumer-driven healthcare company designed totally around the needs of the consumer.”
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A new Swedish system called BodyKom, claims it enables doctors to monitor their patients through a wireless device that “hones in” to sensors on the patient. The unit automatically alerts the hospital or healthcare service over a secure mobile network when unusual changes occur, also pinpointing the patient’s exact location through GPS technology.
The system is now being tested at a university hospital in Sweden. First target is to monitor patients with erratic heart rate. Hopefully this will be expanded to patients with diabetes, asthma and other ailments that frequently require immediate medical care.
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Peanuts are back in favor. The FDA has authorized a qualified health claim for peanuts - and studies at several universities report that eating moderate amounts (about an ounce a day) help prevent heart disease and can actually lower cholesterol counts.
There is even a modest weight-loss claim from industry spokes- people who point out that this one-ounce serving totals just 200 calories & stops people from munching on higher-calorie snacks.
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The Canadian healthcare system continues to fall from grace. A coalition of Canadian physician groups recently published a list of proposed maximum waits for care in highest-priority medical situations. It ranges from “no longer than a week” for a CT scan or MRI - to “high priority” hip or knee replacements in nine months. If approved, all this would be a major improvement over current wait-times.
According to Cancer Care Ontario -- which stresses that immediate treatment is essential to achieving the best possible results -- there is an average wait-time of ten weeks before breast cancer patients begin their treatment.
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Surgeons at the University of Rochester Medical Center have successfully inserted a battery-powered pulse generator under a patient’s collarbone to stimulate nerves in the carotid arteries, thereby helping to regulate runaway blood pressure that could lead to heart or kidney complications. Though the unit was developed by an American company, this is the first time the procedure has been used in the United States. The “pacemaker” has had limited trials in Europe, almost all with good results.
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Another small step in the ongoing yet elusive “green tea is good for you” research efforts. Scientists in Norwich, England and at the U of Murcia in Spain have concluded that a compound called EECG -- found in too-small-to-matter amounts of regular tea, but in much larger quantities in green tea -- helps prevent cancer cells from growing by binding to a specific enzyme.
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Doctors at George Washington University report that breast cancers so small they may be missed by current mammograms have been identified and targeted by a new computer-based system. In tests, over 90% of cancers five millimeters in size or smaller were detected. Their full report was presented recently in the American Journal of Roentgenology.
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A new convenience is starting to take shape for employees that have opted for Health Savings Accounts. A few enterprising healthcare plans, led by Kaiser Permanente, have introduced modest-line-of-credit healthcare services cards equal to the employee’s initial lump-sum deductible - thereby eliminating the possible need for upfront emergency cash at a doctor’s office. Kaiser introduced a special-target credit card early in the year.
UnitedHealthcare has been imaginative in another way - initiating a marketing agreement with an Amex division that enables its small-business cardholders to sign up for group-discounted limited health insurance plans.
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A small experiment is taking place at Blue Cross Blue Shield of Minnesota. Until now, the plan insisted that patients order their chronic-pain, 90-day supplies by mail, which came in a little cheaper than at the local pharmacy, but with the usual through-the-mail problems. Apparently the pharmacies have been feeling the financial pain and decided to discount a bit more to BC/BS. Some pharmacy managers say this could be the beginning of a national trend.
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