Research Roundup - September 2016


Governor Signs State Surprise Medical Bill Law

By Victoria Colliver | San Francisco Chronicle | Sept. 23, 2016

New legislation will provide Californians strong consumer protections against getting unexpected out-of-network medical bills, according to the San Francisco Chronicle. Unlike New York’s law, California’s law  require insurers to reimburse these out-of-network providers at 125 percent of the rate Medicare pays, or at the insurer’s average contracted rate, whichever is greater.The bill goes into effect July 2017 and included seven other healthcare consumer protection measures.

“Secret Shopper” Study Finds Barriers to Timely Access to Care Post-ACA

By Simone Haeder, et al. | Health Affairs | Aug. 29, 2016

A Health Affairs study explored network adequacy for insurance plans sold inside and outside insurance marketplaces. The study found that timely access to primary care providers is challenging, including long wait times and difficulty securing an appointment with a provider.  In addition, these challenges are attributable to errors and inconsistencies in provider network directory.


Antitrust Suit Settled in Florida

By Erica Teichert | Modern Healthcare | Aug. 16, 2016

Florida doctors from Health First have settled a nearly $350 million antitrust suit, according to Modern Healthcare.  Omni Healthcare alleged that Health First had participated in an illegal “hospital monopoly” by acquiring Melbourne Internal Medicine Associates in 2013. Health First faces other lawsuits claiming that they have participated in anticompetitive behavior.


Hawaii’s Largest Insurer Will Cap Physician Payments

By Brianna Ehley | Politico Pro | Sept. 9, 2016

Beginning January 2017, the Hawaii Medical Service Association will pay physicians a standard monthly rate per patient in an effort to promote high-quality care, according to Politico Pro. In addition, twenty percent of the payments will be based on the quality of care and preventive services provided to consumers. A pilot program with 100 primary doctors was launched in April.


How Advocate Health System Uses Behavioral Economics to Motivate Physicians in Its Incentive Program

The Commonwealth Fund | May 25, 2016

Advocate Health Care successfully used a combination of individual and group incentives to increase care coordination and cost-effectiveness, according to The Commonwealth Fund.  Monetary and non-monetary incentives, such as performance feedback and plaques, served as powerful motivators for physicians.


Healthcare Advocacy Group Pushes Lawmakers to Address Drug Prices

By Ovetta Wiggins | Washington Post | Sept. 8, 2016

In light of the recent price increases for Epi-Pen, the Maryland Citizens’ Health Initiative is pushing Maryland lawmakers to addressing the rising cost of drugs. According to the Washington Post, the group wants the legislature to require drug companies to disclose how they come up with their prices, notify the public of price hikes and grant the attorney general authority to take legal action. Maryland would be one of the first states to pass legislation requiring drug companies to disclose information about prices.  


The Affordable Care Act’s Effects on the Formation, Expansion, and Operation of Physician-Owned Hospitals

By Elizabeth Plummer and William Wempe | Health Affairs | Sept. 2016

Physician-owned hospitals in Texas experienced significant pre-ACA increases in the formation, physician ownership and physical capacity of physician-owned hospitals in anticipation of changing policies, according to Health Affairs. After ACA implementation, hospitals generated revenue by leveraging their assets; for example, increasing the number of staffed beds and surgeries performed per operating room. Researchers also found that ACA restrictions effectively eliminated the formation of new physician-owned hospitals.

Words to Live By: Baylor Scott and White to Text High-Risk Patients

By Sabriya Rice | Dallas Morning News | Aug 29, 2016

In an attempt to better reach high-risk patients, Texas providers have started connecting with patients via text message, according to the Dallas Morning News. The initiative, in addition to the transportation programs already in place, is expected to decrease no-show rates for office visits.

Bundled Payments Generate $6.1 Million for Texas Hospital Group on Joint Replacements

The Commonwealth Fund | Aug. 3, 2016

A Texas hospital group generated an average savings of $284 per joint replacement in a demonstration that features a bundled payment for joint replacements, according to The Commonwealth Fund. Physician were guaranteed Medicare payment rates and offered bonuses of up to 25 percent. Program success relied on physician engagement, which was achieved through establishing individual and group gainsharing thresholds supported by transparency for physician level cost and quality data.


Vermont Takes Step Towards All-Payer Reimbursement Model

By Virgil Dickson | Modern Healthcare | Sept 28, 2016

Vermont is seeking CMS approval of an all-payer model agreement that would pay uniform rates for physician and hospital services organized into accountable care organization from 2017-2021, according to Modern Healthcare. The waiver seeks to set cost growth targets and improve care delivery for beneficiaries in Medicare, Medicaid and in the commercial market.

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Recent Reports

The Ongoing Cost Shift in Employer Health Benefits

By Bob Herman | Modern Healthcare | Sept. 14, 2016

During the past five years, deductibles for people with insurance from their employers  have grown 10 times as fast as inflation and nearly six times as fast as wages, according to Modern Healthcare.

Consumer-Driven Health Plans: A Cost and Utilization Analysis

Health Care Cost Institute | September 2016

Per capita spending for consumer-driven health plans (CDHP), or high-deductible plans, was lower compared to non-CDHP, according to research by the Health Care Cost Institute. The savings were the result of lower utilization rates in every service category, including inpatient, outpatient, professional services and prescriptions. The most significant decrease was observed in brand-name prescriptions. Despite decreasing total spending, per capita out-of-pocket spending was higher for the CDHP population compared to the non-CDHP population.

HSA-Eligible Health Plan Decreases Health Service Use

By Paul Fronstin and M. Christopher Roebuck | Employee Benefit Research Institute | August 2016

Research conducted by the Employee Benefit Research Institute found that enrollment in an HSA-eligible health plan reduced physician office visits, prescription drug fills and inpatient admissions. The decline in non-preventive outpatient office visits and preventive services was greater for workers with incomes less than $50,000, compared to higher-income individuals. A handful of services included in the research experienced no change in usage when comparing HSA-eligible health plans and PPO plans, including inpatient hospital days, avoidable emergency department visits, pneumonia vaccinations, human papillomavirus vaccinations, and glycated hemoglobin testing for individuals with diabetes.

Kaiser Health Tracking Poll: August 2016

By Ashley Kirzinger, et al. | Kaiser Family Foundation | Sept. 1, 2016

A poll by the Kaiser Family Foundation finds consumers are primarily concerned about the future of Medicare and the access and affordability of care. Other poll topics, ranked from highest to lowest, include the future of Medicaid, the cost of prescription drugs, the future of the 2010 healthcare law, the opioid epidemic, access to reproductive health services, Zika, and HIV/AIDS. The September poll found that Americans are critical of drug prices and support government action to make prices more affordable.

Reducing Low-Value Care

By Beth Beaudin-Siler | Health Affairs Blog | Sept. 20, 2016

It is estimated that spending on wasteful care accounted for $765 billion dollars in 2013, which includes $340 billion low-value care.  Despite the magnitude of this problem, stakeholder interviews revealed a marked lack of consensus regarding strategies to reduce the use of low-value care, according to Health Affairs.  

Hospital Ownership of Medical Practices Grows by 86 Percent in Three Years

By Maria Castellucci | Modern Healthcare | Sept. 7, 2016

One in four medical practices were owned by hospitals in 2015, up from one in seven in 2012, according to Modern Healthcare. During the same time period, physicians employed by hospitals increased by 50 percent.

Changes in Hospital-Physician Affiliations in U.S. Hospitals and Their Effect on Quality of Care

By Kristin W. Scott, et al. | Annals of Internal Medicine | Sept. 20, 2016

Integrating physicians as employees at hospitals is not associated with improved health outcomes,  according to a study in the Annals of Internal Medicine. Mortality rates, 30-day readmission rates, length of stay and patient satisfaction scores were similar between hospitals that employed physicians and those that did not.

Old Hospital Star Ratings Didn’t Have Better Outcomes? New Analysis

By Heather Punke | Becker’s Healthcare | Aug. 30, 2016

New research suggests that the 5-star ratings CMS awarded to hospitals in 2015 did not correlate with better quality, according to Becker’s Healthcare. This research conflicts with a study released in April that found 5-star hospitals had lower mortality and readmission rates. Hospital ratings are no longer tied to just patient experience measures. In July 2016, CMS added quality metrics into the methodology helping to reduce concerns that the scores reflect little quality information.

ACOs Save Medicare $466M, Quality Improvements Are Mixed

By Mary Ellen Mcintire | CMS | Aug. 25 2016

125 of the 400 accountable care organizations received bonus payments for meeting quality performance standards, according to CMS. The organizations are participants in the CMS Medicare Shared Savings and Pioneer ACO Model programs. In 2015, the ACOs generated more than $466 million in savings for Medicare, for a total savings of $1.29 billion since 2012. These findings are being contested by some experts who suggest CMS actually lost $116 million in 2015.

One-Third of ACA Exchanges Will Lack Competition in 2017

By Robert King | Washington Examiner | Aug. 19, 2016

More than 50 percent of exchange market regions may include two or fewer carriers in 2017, according to the Washington Examiner. Mounting financial losses have led to the withdrawal of insurers from many markets. Less competition in the insurance markets provide consumers with fewer choices and insurers more leverage to charge more.

Risk Contracting and Operational Capabilities in Large Medical Groups

By Robert Mechanic and Darren Zinner | American Journal of Managed Care |June 17, 2016

In 2013, 68 percent of large multi-specialty group practices’ total patient revenue was from fee-for-service payments and 32 percent was from risk arrangements, according to the American Journal of Managed Care.

GAO: Drug Coupons May be Driving up Part B Payments

By Sarah Karlin-Smith | Politico Pro | Aug. 26, 2016

Medicare could have saved $69 million in 2013 if Part B drug reimbursement was based on the market price instead of the average sales price (ASP),  according to Politico Pro’s analysis of a GAO report. ASP does not reflect drug coupon use, and hence is higher than the final reimbursement the drug manufacturer received.  While coupon use is not permitted for Part B drugs, 2013 data shows that coupon use by commercial coverage enrollees for 18 drugs reduced the manufacturers’ final price by .7 percent compared to ASP.

Shorter Hospital Stays Cost More, May Not Help Outcomes

By Zack Budryk | Fierce Healthcare | Sept. 2, 2016

A study on neo-natal intensive care patients found that found that longer lengths of stay resulted in lower costs and better clinical outcomes, according to Fierce Healthcare. Longer stays were also associated with 97 percent fewer cases of sepsis.

Two-Year Costs and Quality in the Comprehensive Primary Care Initiative

By Stacey B. Dale, et al. | NEJM Catalyst | Aug. 5, 2016

At the midpoint of the four-year Comprehensive Primary Care Initiative, participating practices have experienced little cost savings for Medicare patients or improvements in the quality of care or patient experience, according to NEJM Catalyst. The 502 practices spanning four states - Arkansas, Colorado, New Jersey and Oregon - will continue to receive care-management fees until the conclusion of the program in December 2016.

2015 National Healthcare Quality and Disparities Report

AHRQ | April 2016

Improvements have been made regarding the quality of healthcare and persistence of disparities; however, more can be done, according to AHRQ. Measures associated with patient-centered care, effective treatment and patient safety experienced the greatest improvement through 2013. In contrast, care coordination and care affordability measures lacked significant improvement.

Annual Growth in Treated Prevalence Approaching Annual Growth in Price

By Cynthia Cox et al. | Peterson-Kaiser Health System Tracker | March 29, 2016

Although annual growth in disease-based price index is chiefly responsible for the increase in per capita spending, annual growth in the number of patients treated is catching up, according to Peterson-Kaiser Health System Tracker. From 2005-2012, growth attributed to prices dropped from  3.5 percent to 2.2 percent. Over the same time, the growth in spending attributed to treated prevalence has grown from 1.3 percent to 1.6 percent.

For more background on drug spending, high-deductible health plans, consolidation, population health measures and more, please visit


Non-Medical Barriers Affect Pricing and Health Outcomes

By Elizabeth Bradley and Lauren Taylor | Robert Wood Johnson Foundation | Aug. 17, 2016

A frequently cited fact is that the U.S. spends more on healthcare than any other developed nation but suffers the worse health outcomes.  Referencing a Health Affairs study, this blog post from the Robert Wood Johnson Foundationfinds outcomes are also connected to what we spend on social services.  When comparing state-to-state spending, the states that spent more on social services generally had better outcomes.  Authors conclude we must begin to focus on a wider variety of factors when making healthcare spending  decisions.  

Memo to the President: The Pharmaceutical Monopoly Adjustment Act of 2013

By Alfred Engelberg | Health Affairs Blog | Sept. 13, 2016

Drug prices could be more affordable if the government rolled back the extra monopolies drug companies enjoy, according to the Health Affairs Blog post. This could include reducing market exclusivity for biologic drugs from twelve to seven years, eliminating patent term extensions and repealing laws that delay FDA approval of generic drugs when patent claims are made, among other things.

Want to Know Whether Your Health Plan’s Network is Narrow or Broad? You’ll Need to Wait

By Sabrina Corlette | Center on Health Insurance Reforms | Sept. 12, 2016

The rating system for health plan’s network size that was supposed to be available in all federally facilitated marketplaces (FFM) this year will now be limited to a pilot in six states, according to the Center on Health Insurance Reforms. The tool’s implementation in the remaining FFMs has been delayed until at least 2018.

Tales from the Healthcare Shopping Front: Good Luck Finding a Cheaper MRI

By Harris Meyer | Modern Healthcare | Aug. 22, 2016

Shopping for healthcare services is not easy for consumers and, as a result, may not be the answer to our nation’s rising healthcare cost problem, according to a blog post in Modern Healthcare. Although the author managed to save $1,500 on an MRI by shopping for a provider, it took him many months, phone calls, emails and persistence to weed out inaccurate information. The author raises the question as to whether employers, insurers and providers are in a better position to evaluate the price and quality of services consumers require.

Doctors Get Disciplined for Misconduct; Drug Firms Keep Paying Them

By Jessica Huseman | NPR | Aug. 23, 2016

At least 400 pharmaceutical and medical device manufacturers have provided payments to 2,300 physicians, despite disciplinary actions against them, according to NPR. The ProPublica analysis was limited to five states - California, Texas, New York, Florida and New Jersey - between August 2013 and December 2015. Disciplinary actions ranged from minor - failing to complete continue medical education credits - to serious offenses, including inappropriate prescribing and sexual misconduct.

Hospital Surprise, Medicare’s Observation Care (Video)

By Francis Ying, et al. | Kaiser Health News | Aug. 29, 2016

Medicare patients receiving observation care has grown more than 100 percent since 2006 to include almost two million beneficiaries in 2014, according to Kaiser Health News. Observation care is considered an outpatient service, despite being provided to seniors at a hospital who are too healthy to be admitted, but too sick to go home. Beneficiaries are often unaware of the distinction and face increased costs associated with the care.

Thinking Creatively to Fill Gaps in the Healthcare Workforce

By Carrie Feibel | Houston Public Media | Sept 14, 2016

Texas is one of twenty-nine states that restricts the ability of nurse practitioners (NPs) to work independently. But changing scope of work regulations would greatly reduce the physician shortage by enabling NPs and other categories of providers, such as dental therapists and  grand-aides to take on new patient care roles, according to Houston Public Media. These lower-cost providers may improve patient care and health outcomes. For example, studies show that patients with access to grand-aids are less likely to be re-admitted to the hospital 30-days after discharge.

10 Tactics for Improving Health Insurance Provider Networks for Communities of Color

By Claire McAndrew | Families USA | August 25, 2016

Advocates have ten tactics for improving network adequacy, according to Families USA. Six target state officials, such as reporting issues to the insurance department and partnering with the insurance regulator or marketplace staff to advocate for more consumer-friendly policies.The remaining four tactics target federal officials, such as reporting issues to the regional HHS director.

Burden of Healthcare Costs Moves to the Middle Class

By Anne Louie Sussman | The Wall Street Journal | Aug. 25, 2016

Consumers, especially those considered “middle-income,” are getting hit hardest by increasing medical care costs, according to The Wall Street Journal. Deductibles have risen by 67 percent since 2010 and show no signs of slowing down. Rising healthcare costs result in consumers forgoing needed care and having less money to buy other things, such as housing, food and clothing.

Limiting Choice to Control Health Spending: A Caution

By Austin Frakt | The New York Times | Sept. 15, 2016

Narrow networks are increasingly prevalent in health plans as insurers work to balance premiums and consumer choice, according an editorial in The New York Times. Similarly to the 1990’s backlash against managed care plans, success of these plans may be undermined if cost-cutting measures prevent patients from obtaining needed treatments. Today’s narrow networks may fare more favorably with consumers with the focus on high quality providers and consumer friendly network adequacy measures.

A New Emphasis on Social Factors to Reduce Readmissions

By Lisa Ward | Modern Healthcare | Sept. 2, 2016

Research has provided disappointing results for tele-monitoring’s effect on overall readmission rates, according to Modern Healthcare. During a time when payment reform is increasingly holding hospitals accountable for episodes of care rather than admissions, tele-monitoring may not be the silver bullet providers were hoping for. Other interventions, such as follow-up phone calls and leveraging social networks to encourage medicine adherence, can be used in tandem to provide a more holistic approach to keeping patients out of the hospital.