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Research Roundup - December 2017

Arkansas

Arkansas Adopts Limits on Opioid Prescribing

By Christine Vestal | Stateline | Dec. 11, 2017

Arkansas’ state medical board has joined 24 states in adopting regulations limiting the number and strength of opioid painkillers doctors can prescribe, reports The PEW Charitable Trusts’ Stateline. The new restrictions, based on 2016 guidelines from the Centers for Disease Control and Prevention, require doctors to take a variety of precautions when prescribing highly addictive opioid painkillers and limiting prescriptions for acute pain from an injury or surgery to a seven-day supply. Arkansas has one of the highest per capita opioid consumption rates in the nation and future analysis will be needed to determine the regulation’s impact on healthcare quality and cost.

California

The U.S. Maternal Death Rate is Unacceptably High and It Doesn't Have to Be: California Doctors Came Together and Brought the State Maternal Death Rate Way Down

By Byrd Pinkerton, et al. | Vox | Dec. 4, 2017

Compared to its peer countries, the United States has a surprisingly high maternal death rate. “Toolkits” that help doctors manage the most prevalent causes of maternal death have cut California’s maternal death rate by more than half in five years. The toolkits address a number of complications associated with childbirth – including preeclampsia, blood clots and hemorrhage – by providing doctors physical tools, as well as step-by-step instructions to guide them through potentially life-saving procedures. The initiative is spearheaded by a multi-disciplinary health collective that: collects data about maternal health, zeros in on the complications that can be prevented, figures out what the evidence says about the steps required to prevent them, and then engages stakeholders and mentors them as they follow those lifesaving steps.

Connecticut

Piercing the Darkness in Connecticut: A Supplement to the National Price Transparency and Physician Quality Report Card

By Francois de Brantes | Altarum | November 2017

For the past several years, healthcare costs in Connecticut have continued to rise, despite evidence suggesting that consumers are not uniformly receiving high quality care. Additionally, the state received double F’s on the Leapfrog Group’s Price Transparency and Physician Quality Report Card for its ability to help consumers find the information they want and need to compare the price and quality of their healthcare. A recent report released by Altarum examines Connecticut’s cost and quality issues, highlighting the inefficient management of hospital expenses and arguing against the continued inflation of prices irrespective of healthcare value.

Governor Proposes State Office of Health Strategy

By Connecticut Business and Industry Association | 2017 

In November, Connecticut passed legislation to establish an Office of Health Strategy, which will oversee all of the state’s major health reform and planning initiatives. These include the Health Information Technology Office, the State Innovation Model Management Office, the All-Payer Claims Database and the Office of Healthcare Access. “The Office of Health Strategy is an opportunity to ensure better health outcomes, to lower costs and to create a more efficient healthcare system,” said Lt. Gov. Nancy Wyman. “This signifies important progress that must continue—and is most effectively coordinated by a single entity.”

Illinois

Advocate Health Crosses State Lines to Merge With Aurora

By Alex Kacik | Modern Healthcare | Dec. 4, 2017

Advocate Health Care plans to merge with Aurora Health Care in a deal that would create the 10th largest not-for-profit system in the country, according to an article in Modern Healthcare. The Illinois-based Advocate has turned its focus to Wisconsin's largest healthcare provider. The Advocate-Aurora deal would create a health system with 27 hospitals and $10.7 billion in annual revenue.

UnitedHealthcare Launches Value-Based Medicare Advantage Program with Oak Street Health

By Les Masterson | Healthcare Dive | Dec. 4, 2017

UnitedHealthcare and Oak Street Health announced they are establishing a value-based initiative for Medicare Advantage patients in 14 primary care centers in under-served communities in Illinois and two northwestern Indiana locations, according to an article in Healthcare Dive. The initiative will allow the two organizations to identify high-risk patients, help manage their chronic health conditions, effectively manage their medication needs and reduce emergency room visits and hospital re-admissions.

Michigan 

Blue Cross to Limit Opioid Scripts to 30-day Supply

By Jay Greene | Modern Healthcare | Dec.11, 2017

Blue Cross Blue Shield of Michigan will begin a new policy on Feb. 1, 2018, that limits opioid prescriptions to members to 30 days and in some cases five days, according to an article in Modern Healthcare. Members who haven't had a recent prescription filled and are prescribed a short-acting agent will have their initial fill limited to five days. Blue Cross limits short-acting agents to 15 days and will be moving to a five-day fill limitation. In Michigan, 1,365 people died of opioid overdoses in 2016, compared to 884 in 2015 and 426 in 2012, meaning Michigan's overdose rate has tripled since 2012.

Minnesota

Diabetes Hospitalizations are Falling in Minnesota

By Mark Zdechlik | MPR News | Dec. 14, 2017

Better efforts to coordinate care have resulted in a 22 percent drop in hospitalizations for diabetes according to researchers at the Minnesota Health Department. The decline between 2006 and 2014 resulted in fewer hospitalizations for diabetes related health problems (other than extremely high or low blood sugar levels). In 2008 the state launched several initiatives to control health care spending related to chronic conditions, focusing on obesity and smoking, improving disease management in primary care, and quality improvement systems that measure care and outcomes as part of state-wide partnership targeting diabetes. 

New York

NYC Hospital Prioritizes Collection of Patient-Reported Outcome Data

By Maria Castellucci | Modern Healthcare | Dec. 2, 2017

To truly know if patients are feeling better after a surgery, hospitals can't rely only on routine quality metrics. That's where collecting data on patient-reported outcome measures can help. According to an article in Modern Healthcare, all patients at New York’s Hospital for Special Surgery began post-operatively asking patients 10 questions from the Patient-Reported Outcomes Measurement Information System, or PROMIS, a survey about the patient's quality of life and ability to function. Questions are related to the patient's social support system as well as pain intensity and sleep behavior. Those responses are logged into the patient's electronic health record. This allows doctors to understand how the patient's quality of life changed before and after the procedure. 

North Carolina

New Maternal Mortality Strategy Relies on ‘Medical Homes’

By Michael Ollove | Pew Charitable Trust | Dec. 5, 2017

Mountain Area Health Education Center’s ob-gyn program is part of a statewide initiative in North Carolina that identifies low-income women with high-risk pregnancies and provides care through “medical homes,” reports The PEW Charitable Trusts’ Stateline. The medical homes provide the most advanced obstetrical care, but they also seek to alleviate nonmedical circumstances that could put mother and child in jeopardy, such as addiction, domestic abuse and a lack of secure housing and healthy food. North Carolina’s program is the only statewide pregnancy medical home model in the country. According to the Institute for Healthcare Improvement, the “well-defined and rigorous” program will likely become a model for other states.

Utah

Bills of Health: What’s Driving Medical Service Costs in Utah

By Utah Foundation Staff | Utah Foundation | Dec. 6, 2017

Utah citizens spend less per capita on healthcare services than in any other state, according to a report released by the Utah Foundation. The report suggests the lower spending rate may be due to certain demographic characteristics and health behaviors of the people of Utah, as well as lower rates of Medicaid and Medicare enrollees, lower number of hospital beds and a low uninsured population rate. And while healthcare spending is rising in Utah most of the costs are attributed to population growth--not an increase in usage. Other findings identified in the report include a variance in hospital rates for the same service and an increase in provider costs which may be attributed to high costs of pharmaceuticals and new technology, increased administration complexity, overtreatment and consolidation among healthcare providers.

West Virginia

Overburdened Mental Health Providers Thwart Police Push For Drug Treatment

By Christine Vestal | Stateline | Dec. 14, 2017

West Virginia has a severe shortage of behavioral health professionals who can help people beat their addictions to drugs and alcohol, according to this Stateline report. And with hundreds of people outside of the criminal justice system on waiting lists for treatment, county mental health officials are hesitant to make room for drug users when not enough beds and treatment services are available for existing clients, according to Jim Johnson, West Virginia’s recently appointed drug czar.

For more state news and to get alerts for your state, visit the Hub website.

Recent Reports

Consumer Behaviors Among Individuals Enrolled in High-Deductible Health Plans

By Jeffrey Kullgren, et al. | JAMA Internal Medicine | Nov. 27, 2017

Few enrollees in high-deductible health plans are engaging in consumer behaviors according to a study in JAMA Internal Medicine.  Saving for future health services was the most common consumer behavior at 40 percent of respondents self-reporting this strategy. Less common: 25 percent of respondents report talking with a provider about the cost of a service and 14 percent of respondents report comparing prices and comparing quality. Finally, only 6 percent of respondents report that they had tried to negotiate a price for a service. The authors argue that more enrollees in high-deductible health plans could be engaging in these consumer behaviors.

How Do Health Expenditures Vary Across the Population?

By Bradley Sawyer and Nolan Sroczynski | Kaiser Family Foundation | Dec. 1, 2017

A small portion of the population is responsible for a very large percentage of total healthcare spending, according to a report and research brief by the Kaiser Family Foundation. Data from the 2015 Medical Expenditure Panel Survey suggests that very few people actually have healthcare spending around the average. The report uses the data to explore the trends and variations in health spending across the population. 

Comparing the Effects of Reference Pricing and Centers-of-Excellence Approaches to Value-Based Benefit Design

By Hui Zhang, David W. Cowling and Matthew Facer | Health Affairs | December 2017 

Health insurance benefit designs based on value-based purchasing have been promoted to steer patients to high-value providers, but little is known about the designs’ relative effectiveness and underlying mechanisms. A study published in Health Affairs compared the impact of two designs implemented by the California Public Employees’ Retirement System on inpatient hospital total hip or knee replacement: a reference-based pricing design for preferred provider organizations (PPOs) and a centers-of-excellence design for health maintenance organizations (HMOs). Both designs prompted higher use of designated low-price, high-quality facilities and reduced average replacement expenses per member at the plan and system levels, but used different routes to achieve their goals. The reference-based pricing design appears more suitable for reducing price variation, and the centers-of-excellence design for addressing variation in use.

Rising Use of Observation Care Among the Commercially Insured May Lead to Total and Out-Of-Pocket Cost Savings

By Emily R. Adrion, et al. | Health Affairs | December 2017

Reports of high out-of-pocket spending for hospital-based observation care among Medicare beneficiaries have received considerable media attention and have prompted direct policy changes. Little is known about the use of, and spending associated with, observation care among commercially insured populations. A recent study evaluating utilization and spending among private-pay patients found that total and out-of-pocket spending were substantially lower for observation care than short-stay hospitalizations. As observation care attracts greater attention, policy makers should be aware that Medicare policies that dis-incentivize observation may have unintended financial impacts on non-Medicare populations, where observation care may be cost saving.

Empowering New Yorkers With Quality Measures That Matter to Them

By Lynn Rogut, Pooja Kothari and Anne-Marie Audet | United Hospital Fund | Dec. 12, 2017

Information that New Yorkers want and need to make informed healthcare choices is severely lacking, according to a report by Lynn Rogut and colleagues. This report synthesizes information on quality reporting and measurement, interviews healthcare experts and lists recommendations from an advisory group on what information consumers want and how to overcome the barriers to getting them the information. 

Making Medicines Affordable: A National Imperative

By Norman Augustine, et al. | The National Academies of Sciences, Engineering, and Medicine | November 2017

Over the past several decades, the biopharmaceutical sector in the U.S. has been successful in developing and delivering effective drugs for improving health and fighting disease, and many medical conditions that were long deemed untreatable can now be cured or managed effectively. At the same time, spending on prescription drugs has been rising dramatically, to the point that many individuals have difficulty paying for the drugs that they or their family members need. A new report, Making Medicines Affordable: A National Imperative, from the National Academies of Sciences, Engineering, and Medicine recommends a number of actions aimed at improving the affordability of prescription drugs without discouraging continued innovation in drug development. The report looks at a number of related areas including the role of generics and biosimilars, intellectual property, financial transparency, drug advertising, as well as insurance benefit designs. The federal government should negotiate prices with pharmaceutical manufacturers in order to make life-saving drug treatments more affordable while encouraging the development of new medicines, according to an article on the report in the New York Times. The report does not promote price controls, instead it outlines a number of strategies to increase competition and make drugs more affordable. Finally, the report supports a change in the way public and private health insurance calculate the reimbursement cost of prescription drugs, using net purchase prices rather than list prices in order to drive down the financial burden to patients.

53% of Docs Still Not Transitioning to Value-Based Care

By Virgil Dickson | Modern Healthcare | Nov. 29, 2017

The majority of physicians remain skeptical of value-based care, according to an article in Modern Healthcare that reports on a joint study with the American Academy of Family Physicians and Humana. According to the report one of the biggest barriers to adoption of value-based care for physicians is a skepticism that using performance measures actually improves patient care. Another barrier to adoption is the perceived amount of workload it would create on the physician without the patient seeing an improvement in outcomes. Supporters of value-based care say more physicians will make the transition when they realize they can be reimbursed for these services, such as care management activities.

Pace of U.S. Health Spending Slows in 2016

By Phil Galewitz | Kaiser Health News | Dec. 6, 2017

The rate at which healthcare spending increased in Medicare, Medicaid, private insurance, prescription drugs and hospitals was lower in 2016 than previous years according to an article in Kaiser Health News which was reporting on a federal study by the Office of the Actuary at the Centers for Medicare and Medicaid Services. The study reports that healthcare spending rose to $3.3 trillion in 2016 but at a slower rate than in the previous two years. The report suggests that there has been a decrease in the demand for prescription drugs, hospital care and physician services. Healthcare spending is still growing however, with a 4.3 percent increase in 2016, compared to a 2.8 percent increase in all other spending on goods and services.

ACOs Savings Aren’t Driven by Reduced Hospitalizations

By Maria Castellucci | Modern Healthcare | Dec. 11, 2017

Overall hospitalizations did not decline for accountable care organization’s participating in the Medicare Shared Savings Program, according to an article in Modern Healthcare. According to a study conducted at Harvard Medical School, the net savings from Medicare’s accountable care organizations were not driven by reductions in hospitalizations. It is suggested that savings may be from reductions in skilled nursing facilities, outpatient and home healthcare.

Visit the Hub website for background on prescription drug spending, reference pricing, high deductible health plans and more!

Commentary/News

A Hospital Charged $1,877 to Pierce a 5 Year Old’s Ears. This is Why Healthcare Costs So Much.

By Marshall Allen | ProPublica | Nov. 28, 2017

Estimates suggest that the United States healthcare system wastes $765 billion each year. An estimated $210 billion going to unnecessary or needlessly expensive care, according to an article in ProPublica which describes the cost of piercing the ears of a 5-year-old girl while she was undergoing an unrelated minor surgery.

Payers Make Value-Based Models a Priority, But Regulatory and ROI Uncertainty Get in the Way

By Leslie Small | FierceHealthcare | Nov. 30, 2017

Value-based programs continue to be a top strategic priority for payers because evidence has shown there is both cost savings and a positive impact on patients, according to an article in FierceHealthcare. Yet there are substantial challenges to implementing value-based programs for both payers and providers. Unpredictability of regulations in the insurance market and uncertainty on the return of investment are among the top concerns.

Why the Giant CVS-Aetna Merger Could Benefit Consumers

By Austin Frakt | New York Times | Dec. 3, 2017

By disrupting the pharmacy benefits management market, and by more closely aligning management of drug benefits and other types of benefits in one organization, CVS could be acting in ways that ultimately benefit consumers, according to an article in The New York Times. Many health industry experts believe that pharmacy benefits managers effectively increase prescription drug prices to raise their own profits. This is because they make money through opaque rebates that are tied to drug prices (so their profits rise as those prices do). Competition among pharmacy benefit management companies could push these profits down, but it is a highly concentrated market dominated by a few firms, CVS among the largest.

Why CVS-Aetna May be Bad for Your Health

By Steven Perlstein | Washington Post | Dec. 15, 2017

CVS-Aetna is what is known as a “vertical merger,” involving firms in different but related markets, according to this editorial in the Washington Post. Because the companies don’t directly compete, vertical mergers have been viewed as good for competition—or at least benign—on the theory that competition will force the newly merged company to pass most of the benefit of any increased efficiency on to consumers. There’s one caveat: Vertical mergers can be anti-competitive if either of the firms is a dominant player in its market and its markets aren’t all that competitive. And that is almost certainly the case in terms of CVS, Aetna and the healthcare sector. 

Emergency Departments are Monopolies. Patients Pay the Price

By Sarah Kliff | Vox | Dec. 4, 2017

Overall spending on emergency department fees increased by more than $3 billion between 2009 and 2015, according to an article in Vox. Focusing on what health plans paid for emergency department services (not what was billed by the hospital) the data showed that the price of emergency department fees rose 89 percent between 2009 and 2015. This increase was twice as fast as outpatient healthcare services and four times faster than overall healthcare spending. All of this, yet emergency department visits have been decreasing. Hospitals argue that patients are older and sicker causing visits to be coded at a higher level of intensity. Others argue that it is not that patients are older and sicker, it is that emergency departments can charge high prices to patients when no other option is available.

Poverty Does Not Have to Equal High Healthcare Spending

By Walker Ray and Tim Norbeck | Forbes | Dec. 4, 2017

The relationship between income and healthcare costs is the focus of research by Dr. Richard Cooper who argues that examining patterns of poverty, wealth and healthcare spending across the U.S. will highlight the true cost drivers of healthcare, according to an article in Forbes. The article calls for experts to actively engage in research of social determinants of health that are driving the cost of healthcare in this country.

What Does ‘Value’ Mean in Healthcare?

By John Commins | Health Leaders | Dec. 11, 2017

There are conflicting ideas of what value is in healthcare, depending on whether you a patient, provider, employer or payer, according to an article in Health Leaders reporting on a study by the University of Utah. According to the study, there is no universal agreement on what constitutes value. Not only is the definition of value unclear (and dependent on the perspective of the stakeholder) but the prioritization of cost, service and quality was also not clear. The study sheds light on the fact that value is multi-dimensional and not having a clear definition and understanding of value will be problematic to moving towards a system of high-value care.

FCC Repeals Net Neutrality Rules, Potentially Affecting Telemedicine

By Rachel Arndt | Modern Healthcare | Dec. 14, 2017

The Federal Communications Commission voted to repeal net neutrality rules, ending regulations that prohibited internet providers from blocking or slowing web content. Whereas all internet traffic previously shared the same "lane," it can now be split among different lanes with different speeds. Those differing speeds could hurt telemedicine since it requires a robust connection, according to an article in Modern Healthcare. Authors note that the FCC could make exceptions for healthcare so it's not subject to the same rules. 

Is Single Payer the Answer for the U.S. Healthcare System?

By Victor Fuchs | JAMA | Dec. 18, 2017

To have any chance of success, a single payer strategy to rising healthcare costs would need a number of requirements, according to an article by Victor Fuchs in JAMA. Simple, minimal bureaucracy, decentralized organizations to deliver care, and an individual’s ability to choose among different health plans would be required if success was to be achieved. Additionally, subsidies to the poor and sick should not require bureaucratic determination. The author argues that universal insurance paid for by a broad general tax in proportion to consumption of all goods and services would be a progressive way to move forward.  

New Tools

States continue to design and develop improvements to their Medicaid programs, using the Section 1115 waivers to best meet their needs. A new tool from the Kaiser Family Foundation called the Medicaid Waiver Tracker identifies which states are seeking waivers or have been approved with a waiver to enhance their Medicaid programs.