Research Roundup - January 2018

California 

Stakeholders Back Standard ACO Measures

By Jacqueline Belliveau | RevCycle Intelligence | Dec. 28, 2017

The Integrated Healthcare Association and Pacific Business Group on Health recently embarked on a joint mission to standardize Accountable Care Organization (ACO) measures for quality and cost performance and benchmarking for commercial organizations in California, reports RevCycle Intelligence. The groups believe standard ACO benchmarking practices can help health plans and providers deliver high-value care without the administrative burden of reporting different quality and cost performance measure sets to each payer. California's efforts are expected to influence the development of a similar national model, which "will be critical to ensure meaningful measurement that minimizes reporting burdens, drives improved performance and results in better, safer care for patients [nationwide],” commented National Quality Forum President Shantanu Agrawal.

District of Columbia

Can Home Health Visits Keep People Out of the ER?

By Selena Simmons-Duffin | NPR | Jan. 2, 2018

A community health center in Washington, D.C. is piloting a program to provide primary care virtually to Medicaid patients who can't make it in to their clinics, according to NPR. The goal of the program is to reduce the number of people who visit the ER for non-urgent problems. D.C. currently has the highest per capita 911 call volume in the country, so preventing unnecessary ER visits will enable emergency clinicians to better attend patients in crisis.

Illinois

‘Pharmacy Deserts’ a Growing Health Concern in Chicago, Experts, Residents Say

By Ese Olumhense and Nausheen Husain | Chicago Tribune | Jan. 22, 2018

More than a dozen Chicago neighborhoods, mostly on the city’s South and West sides, are becoming “pharmacy deserts,” according to an article in the Chicago Tribune. The term describes a community with limited access to a pharmacy, whether retail chain pharmacy or independent pharmacy. In Chicago, research shows most of these neighborhoods tend to be low-income, immigrants, black or Latino. Given the widening scope of services many pharmacies are providing, including physicals, immunizations, drug counseling, sexually transmitted infection screening and other laboratory testing — including access to naloxone, the medication used to reverse opioid overdose — pharmacies are increasingly important to consumers’ access to care.

Kansas

Step Therapy Bill in Kansas Would Restrict Insurers' Prescription Drug Denials

By Andy Marso | Kansas City Star | Jan. 10, 2018

Some insurers use step therapy to try to steer clients toward less expensive, older treatments to see if they are effective before they “step” up to something newer and usually more expensive, reports the Kansas City Star. This practice may hold down premiums and encourage doctors to stick to proven therapies, but it can also prevent patients from accessing innovative and, in some cases, life-saving modes of treatment. A coalition of 20 patient advocacy groups are lobbying Kansas legislators to create restrictions on how insurance companies use step therapy and when doctors can override it. To date, at least 14 states have enacted step therapy restrictions.

Maryland

Maryland to Fight Pharmacist 'Gag Rule' on Drug Costs

By Robert King | Washington Examiner | Jan. 9, 2018

Maryland wants to eliminate a “gag rule” that prevents pharmacists from telling consumers that they can pay less for their prescription drugs, joining a nationwide movement to rein in soaring costs, according to the Washington Examiner. If Maryland succeeds, pharmacies would be allowed to inform customers when they can pay less for a drug out-of-pocket compared to through their insurance. Maryland would join five other states—Connecticut, Maine, Louisiana, North Dakota, and Georgia—that have banned the "gag rule" that some pharmacy benefit managers put in their contracts with pharmacies.

Minnesota

Report Shows Price Variation Among High Volume Inpatient Treatments in Minnesota Hospitals

By Minnesota APCD Staff | January 2018

In the first of a series of reports, the Minnesota Department of Health used data from the state’s all-payer claims database (APCD) to expose price variations charged by hospitals for several uncomplicated inpatient procedures. The report allows employers, consumers and others to explore treatment specific price variations and identify high-value providers. Future reports will explore physician and other provider prices.

New York

Online Tool Compares Health Plans Out-of-Pocket Costs

By Amy Neff Roth | Times Telegram | Dec. 24, 2017

A new calculator can help New Yorkers choose a health plan on the state exchange based on the state of their health, according to an article in the Times Telegram. The NYPlanCosts Calculator is a first-of-its-kind tool that helps people determine their likely out-of-pocket costs under different health plans based on which of 10 health conditions apply to them: bipolar disorder, breast cancer, diabetes, pregnancy and childbirth, heart disease, hepatitis C, HIV, multiple sclerosis, rheumatoid arthritis and schizophrenia. The calculator is based on the idea that premium prices shouldn’t be the only factor people consider when choosing a health plan because out-of-pocket costs can vary greatly.

Texas

Houston Accomplishes Big Healthcare Win with Housing for Homeless

By Renuka Rayasam | Politico | Jan. 10, 2018

Having the city pay someone's rent might seem like a costly way to address homelessness. But add healthcare to the mix and the equation starts to look different. Healthcare and housing experts have long known that keeping someone off the streets is often the most straightforward way to keep him or her out of the emergency room, one of the most expensive places to get healthcare. According to an article in Politico the program Integrated Care for the Chronically Homeless, is a four-year effort by the city of Houston to address housing and access to care. But for the program to grow beyond a localized short-term project into a permanent statewide program, its proponents will have to convince Texas’ conservative lawmakers that the framework will save the state money in the long run. They have until 2019, when the state legislature next convenes, to convince lawmakers to let the state’s Medicaid program, which covers healthcare costs for the homeless, to spend some of those funds on housing support instead.

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Recent Reports

Despite Alternative Payment Model Participation, Fee for Service Still Dominates

By Tanya Albert Henry | AMA Wire | Dec. 21, 2017

Nearly 71 percent of physician practice revenue came from fee-for-service payments in 2016 according to a story in AMA Wire. A study from AMA Policy Research Perspectives indicates that while nearly 60 percent of physicians reported receiving some revenues from at least one alternative payment method, such as pay-for-performance or bundled payment programs, most are still receiving fee-for-service payments. Moreover, the dollars collected from these alternative payment models were relatively small, only accounting for approximately 2-9 percent of practice revenue, depending on the alternative payment model.

2016 Cost Report: Rising Prices Drive Pace of Health Spending Increase

By Health Care Cost Institute | Jan. 23, 2018

Americans used the same amount or less health care in 2016 compared to 2015, but rising prices caused overall spending in 2016 to grow faster than any time in the last five years, according to a report by the Health Care Cost Institute (HCCI). HCCI’s annual Health Care Cost and Utilization Report analyzes health care spending and utilization from 2012 to 2016 for people up to age 65 with employer-sponsored health insurance.

Multi-Stakeholder Partnerships Need Further Development to Fulfill Aspirations for Transforming Regional Health and Well-Being

By Beth Siegel, et al. | Health Affairs | January 2018

A new report published in Health Affairs evaluated existing regional multisector collaborations' ability to transform health and well-being in their communities. Despite promising results from self-assessments, researchers found that most of the partnerships lacked characteristics that appear necessary to transform regional health systems. These findings can help correct misperceptions and clarify ways to best support further partnership development.

Hospitals Not Always Best Fit for Rural Communities

By Tara Bannow | Modern Healthcare | Jan. 17, 2018

A new report by the Bipartisan Policy Center suggests that not all rural communities need critical-access hospitals, reports Modern Healthcare. Although these hospitals are typically an important economic component of rural communities, many are not financially sustainable because of low occupancy. Researchers argue that some communities would be better served by repurposing existing facilities to focus on a mix of primary care and emergency services.

On-line Provider Directory Review Report

By CMS Staff | Centers for Medicare & Medicaid Services | January 2018

A report recently released by the Centers for Medicare & Medicaid Services examines the accuracy of insurers’ online provider directories of Medicare Advantage Organizations.  The review found that 52 percent of provider directory locations had at least one inaccuracy, such as incorrect address or phone numbers and incorrectly listing the provider as accepting new patients. The report pointed out that when provider information is inaccurate it poses a barrier to access to care for patients. CMS issued compliance actions in response to the findings.

Legal and Administrative Feasibility of a Federal Junk Food and Sugar-Sweetened Beverage Tax to Improve Diet

By Jennifer Pomeranz, et al. | American Journal of Public Health | Jan. 10, 2018

In a research study to evaluate the legal and administrative hurdles of enacting a federal “junk” food tax as an incentive to improve diet, researchers found that a federal junk food tax appears feasible. The study, published in American Journal of Public Health, used a meta-analysis approach to identify legal and administrative perspectives on implementing a junk food tax. The authors found that based on product categories or a combination of product categories and nutrient approaches, using a graduated tax strategy, a manufacturer excise tax would be feasible for products with high sugar content. 

Visit the Hub website for background on provider directories, drug spending, rural health, cost drivers, sin taxes and more!

Commentary/News

Healthcare Mega-Mergers Dominate 2017

By Alex Kacik | Modern Healthcare | Dec. 26, 2017

Healthcare mega-mergers dominated 2017, according to a story in Modern Healthcare. Whether it was a small, medium or large merger, arguably all had the same goal, to achieve economies of scale and acquire a financial and competitive edge. While healthcare executives may promise deals that can lower costs and benefit consumers, economists are concerned that there may be misaligned incentives that would result in consumers seeing none of the promised savings.

High-Priced Drugs in Medicare Part D: Diagnosis and Prescription

By Richard Frank and Richard Zeckhauser | Brookings Institution | January 2018

High-drug prices financially stress consumers, payers, employers and the government. At the same time the public demands new and better treatments, and the scientific advances that make such treatments possible. The pharmaceutical industry insists, with merit, that delivering new improved treatments, and in some cases cures, entails high costs and risks, and that without adequate compensation, promising new drug products will not be forthcoming. A study from the Brookings Institution focuses on an extremely costly component of the Medicare Part D program, the region of coverage that kicks in once a consumer has spent $4,950 on drugs in a calendar year.  Authors suggest a framework for negotiating prices that simultaneously preserves incentives for high-value innovation and allows the government to limit the occurrence of excess prices.   

Focused Factories: Pairing Provider Payment and Consumer Benefit Design to Enhance Value

By Suzanne Delbanco and Roslyn Murray | Health Affairs Blog | Jan. 10, 2018

As highly specialized and efficient provider groups, “focused factories” have the potential to standardize care processes and increase positive outcomes, according to the authors of this Heath Affairs blog post. To be successful, however, incentives for providers to eliminate low-value services and for consumers to seek care from focused factories must align. Bundled payments combined with separate reimbursement for evaluating prospective patients could encourage practitioners to provide more appropriate care, while mitigating their potential loss from turning away patients that would not benefit from care at a focused factory. Additionally, improving consumer benefit design through reduced cost sharing and reference pricing could incentivize more patients to use focused factories, authors argue. Combined, these incentives may help reduce waste and produce better results in terms of quality and cost.

Did the Government Overpay for Hundreds of Drugs? It’s Complicated

By Ike Swetlitz | STAT News | Jan. 22, 2018

Drug companies may have stiffed Medicaid over a $1 billion by pricing some brand-name drugs like generics, according to this article in STAT News. The report, released by the HHS Inspector General, didn’t name those companies, but Mylan, maker of EpiPen, landed in hot water for similar behavior the year before. Companies say, for the most part, that they’ve correctly classified their drugs. For the purpose of determining the rebate amounts, drugs were split into two categories — “innovator” drugs, now usually discounted by 23 percent, and “non-innovator” drugs, now usually discounted by 13 percent. But the categories don’t quite match up, due to a little bit of confusing statutory language. That language makes it possible for companies to do what, on the face of it, looks wrong: classifying drugs approved under an NDA (read: brand) as non-innovator (read: generic), and only giving a 13 percent discount instead of a 23 percent discount. Such an apparent mismatch was exactly what the HHS watchdog sought out. It found a total of 885 drugs with that set of qualities, from 54 different companies, in 2016.