Treacher Collins syndrome

Treacher Collins syndrome: a genetic condition that results in a disorder of development of the bones and muscles of the face. The condition affects 1 out of about every 50,000 people and is due to a mutation in a gene known as TCOF1. It is inherited in an autosomal dominant manner, meaning that a person who has one copy of the defective gene will have the condition. However, about 60% of cases occur in people without a family history as a result of new mutations in the gene.

Symptoms of Treacher Collins syndrome range from mild and hardly noticeable to severe and disfiguring. Symptoms can include small and abnormally formed ears, underdeveloped facial bones, a very small jaw and chin (micrognathia),
cleft palate, eyes that slant downward, sparse eyelashes, a notch in the lower eyelids called a coloboma, and hearing loss due to middle ear defects

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Breaking Down The MACRA Proposed Rule

The mother ship has landed. On Wednesday, April 27, the Centers for Medicare and Medicaid Services (CMS) released the highly anticipated proposed rule that would establish key parameters for the new Quality Payment Program, a framework that includes the Merit-based Incentive Payment System (MIPS) and Alternative Payment Models (APMs). These policies were established by the latest, permanent 'doc fix,' the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA).

For additional background, please refer to recent Health Affairs Blog posts on MACRA, MIPS, and APMs, as well as a comprehensive brief on MACRA. This post briefly outlines the key elements of the proposed rule.

MIPS

The proposal defines which eligible clinicians will initially participate in the Quality Payment Program via MIPS, with CY 2017 proposed as the first performance period on which CMS plans to base the CY 2019 payment adjustment. Eligible clinicians include physicians, physician assistants, nurse practitioners, clinical nurse specialists, certified registered nurse anesthetists, and groups that include such clinicians.

As outlined in MACRA, the proposal would consolidate three currently disparate Medicare quality programs into MIPS: (1) the Physician Quality Reporting System; (2) the Value-Based Modifier Program; and, (3) the 'Meaningful Use' of electronic health records. CMS proposes that eligible clinicians receive a composite score relative to their performance in each of four categories. Quality measures for these core domains will be selected annually, with the data regarding clinician performance on the measures made available via the Physician Compare website.

The four performance categories are:

1. Quality: 50 percent of total score in year 1;


2. Advancing Care Information: 25 percent of total score in year 1, formerly EHR Meaningful Use;


3. Clinical Practice Improvement Activities: 15 percent of total score in year 1, this is essentially the “new” domain added to the previously existing other three; and,


4. Cost or Resource Use: 10 percent of total score in year 1, based on Medicare claims data - no reporting necessary.

Importantly, in an accompanying blog post, CMS delineates changes made to the Meaningful Use program, as incorporated into MIPS as the “Advancing Care Information” domain identified above. The Advancing Care Information proposal aims to “support the vision of a simpler, more connected, less burdensome technology,” CMS states. The proposal will, among other things, “[a]llow physicians and other clinicians to choose to select the measures that reflect how technology best suits their day-to-day practice” and will “[r]educe the number of measures to an all-time low of 11 measures, down from 18 measures, and no longer require reporting on the Clinical Decision Support [CDS] and the Computerized Provider Order Entry [CPOE] measures,” the agency states.

Finally, in an important parallel policy thread that continues to unfold, CMS cites ongoing work to assess the issue of risk adjustment for socioeconomic status (SES) on quality measures, with a report due to Congress on this front by October 2016. CMS notes that it “will closely examine the [SES] recommendations” and incorporate them to the degree feasible and appropriate via future rulemaking.

APMs

CMS proposes an approach to implementing the MACRA APM pathway through which eligible clinicians can become “qualifying participants” and earn statutorily specified incentives for participation. Advanced APMs must meet three proposed requirements deriving from the MACRA statute:

1. Required use of certified EHRs;


2. Payment for covered professional services based on comparable quality measures; and,


3. Either being an enhanced medical home or bearing more than “nominal risk” for losses.

A key element stakeholders have been looking for CMS to define is the degree of risk an APM must bear to quality. CMS proposes a “generally applicable financial risk standard” that requires APMs to include provisions that, if actual expenditures exceed expected expenditures, CMS can withhold payment, reduce payment rates, or require the APM to incur a debt to CMS. The risk must be more than nominal, which CMS defines-in true Goldilocks fashion-as “meaningful for the entity but not excessive.” If you want to know more here, check Table 28 in the proposal.

Additionally, to qualify clinicians for enhanced payments under MACRA, APMs must be compulsory, have a clear “thesis” that they are testing, and require participants to have a formal agreement with CMS. If APMs offer multiple tracks varying the degree of financial risk or tailoring participation to different types of organizations, CMS would “assess the eligibility of each such track or option within the APM independently.” CMS proposes that the agency will notify the public online of the APMs qualifying as Advanced APMs prior to each performance period, which will begin no later than January 1, 2017. Table 32 has a preliminary list.

MACRA requires CMS to establish criteria to be used by a Physician-Focused Payment Model Technical Advisory Committee (PTAC - aka, the doctor voice in all of this) to make comments and recommendations on proposed physician-centric APMs.

The proposed criteria are organized into three categories:

• Criteria that promote payment incentives for higher-value care;


• Criteria that address care delivery improvements that promote better care; and,


• Criteria that address improvements to the availability of information to guide decision-making (through the use of Health IT, e.g.).

Back to the Big Picture

CMS estimates that in 2019, the first year in which there will be a payment consequence for MIPS performance, $500 million in “exceptional performance payments” will be distributed to eligible clinicians. Further, the agency will make around $200 million in APM incentive payments that year.

CMS plans to post additional information relative to the proposal on its MACRA MIPS/APM landing page here. Comments on the proposed rule are due on or around June 27, depending on the date of formal publication in the Federal Register. Enjoy.

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Migraine headache

Migraine headache: The most common type of vascular headache involving abnormal sensitivity of arteries in
the brain to various triggers resulting in rapid changes in the
artery size due to spasm (constriction). Other arteries in the brain and scalp then open (dilate), and throbbing pain is perceived in the head. The tendency to migraine is inherited and appears to
involve serotonin, a chemical in the brain involved in the
transmission of nerve impulses that trigger the release of substances in the blood vessels that in turn cause the pain of
the migraine. These nerve impulses cause the flashing lights and
other sensory phenomena known as an aura that may accompany a migraine. Not all severe headaches are migraines and not all migraines are severe.

Factors known to make migraines worse
in some patients include stress, food sensitivities, menstruation,
and the onset of menopause. Most patients will feel better if they lie down and avoid bright lights. Prevention measures can include taking preventative medication (usually an antispasmodic) and
avoiding any known migraine triggers. Medication is also available
that can ease the pain of a current migraine.

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Health Affairs Web First: For Medical Procedure Costs Vary Greatly By Locale

There are many reasons for geographic differences in health expenditures, including utilization, the cost of doing business, and providers' and insurers' ability to negotiate prices. A new study, released as a Web First by Health Affairs, examined the variations in the prices for 242 common medical services in 41 states and the District of Columbia, using a national multipayer commercial claims database for the years 2012 and 2013.

The authors, David Newman, Stephan T. Parente, Eric Barrette, and Kevin Kennedy, examined prices across states, compared overall price levels by state, and explored price variation within states. They sometimes found more than a threefold variation. Alaska had the highest average health care prices, followed by Wisconsin, North Dakota, New Hampshire, and Minnesota. Florida had the least expensive services.

To illustrate one of the 242 procedures-a pregnancy ultrasound-the authors found that in Ohio, the average price in Cleveland ($522) was almost three times that in Canton ($183), though the two cities are only 60 miles apart. Conversely, in Virginia, Virginia Beach ($275) and Richmond ($271), while 107 miles apart, had nearly identical prices (exhibit below).

“Although revealing the extent of price variation is an important first step, more systematic and consistent research is necessary to identify the forces that drive prices,” concluded the authors. “The questions that remain for researchers, policymakers, and health care leaders are as follows: Why do prices for the same service differ markedly across distances of only a few miles, and what amount of that difference is justificable?”

Newman, Barrette, and Kennedy are affiliated with the Health Care Cost Institute in Washington, D.C.; Parente is with the University of Minnesota, in Minneapolis.

This study, part of Health Affairs' DataWatch series, will also appear in its May issue.

Botox

Botox: A highly purified preparation of botulinum toxin A, a toxin produced by the bacterium Clostridium botulinum. Botox is injected, in very small amounts, into specific muscles, as a treatment. It acts by blocking the transmission of nerve impulses to muscles and so paralyzes (relaxes) the muscles. Botox treatment has found a growing number of uses from easing muscle spasms (as, for example, in spastic cerebral palsy) to its increasingly widespread cosmetic use in flattening wrinkles.

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Progeria

Progeria: A rare genetic disorder that causes children to age prematurely. The classic type of childhood progeria is Hutchinson-Gilford syndrome, which is commonly referred to as progeria. It is characterized by dwarfism, baldness, pinched nose, small face and small jaw relative to the head size, delayed tooth formation, aged-looking skin, diminution of fat beneath the skin, stiff joints, and premature arteriosclerosis. Children with the progeria syndrome usually appear normal at birth. However, within a year, their growth rate slows and their appearance begins to change and age prematurely. They often suffer from symptoms typically seen in elderly people, especially severe cardiovascular disease. Death occurs on average at age 13, usually from heart attack or stroke.

Progeria is due to a single-letter "misspelling" in a gene on chromosome 1 that codes for lamin A, a protein that is a key component of the membrane surrounding the cell's nucleus. Most children with classic progeria harbor exactly the same misspelling in the lamin A (LMNA) gene, a substitution of just a single DNA base -- a change from cytosine (C) to thymine (T) -- among the gene's 25,000 base pairs. In a few progeria patients there may be a different single base substitution such as guanine (G) to adenine (A) just two bases upstream. In every instance, the parents are normal indicating that the misspelling is a new, or "de novo," mutation in the child. The minute change in the LMNA gene changes the way in which the sequence is spliced by the cell's protein-making machinery. The end result is the production of an abnormal lamin A protein that is missing a stretch of 50 amino acids near one of its ends.

Different mutations in other regions of the LMNA gene are responsible for a half-dozen other rare, genetic disorders. Those disorders are: Emery-Dreifuss muscular dystrophy type 2, limb girdle muscular dystrophy type 1B, Charcot-Marie-Tooth disorder type 2B1, the Dunnigan type of familial partial lipodystrophy, mandibuloacral dysplasia and a familial form of dilated cardiomyopathy.

There currently are no diagnostic tests or treatments for progeria which remains relentlessly progressive and fatal. Although Hutchinson (1886) and Guilford (1904) did describe the disorder, it was recorded that on "March 19, 1754, died in Glamorganshire of mere old age and a gradual decay of nature at 17 years and 2 months, Hopkins Hopkins, the little Welshman.... He never weighed more than 17 pounds but for three years past no more than 12." The term "progeria" is derived from the Greek word for old age, "geras."

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Increasing Access To Dental Care For Seniors To Improve Overall Health

Shirley, like other senior residents in downtown San Diego, faces stark choices in day-to-day life. With more than 40 percent of seniors in San Diego living below the self-sufficiency level, many, like Shirley, have to choose between paying rent and buying medicine, between purchasing food and taking care of their teeth-choices none of us would ever want to make.

Shirley is among many low-income seniors who are missing some or all of their teeth because of lack of access to affordable oral health care. When Shirley was growing up, her mom never took her to the dentist because the family didn't have the money for routine dental care. As an adult, most of Shirley's teeth have been pulled to avoid more costly options, such as implants, bridges, or crowns.

San Diego's lower-income senior community mirrors nationwide trends: nationally, more than 70 percent of seniors have periodontal disease, which can often lead to increased risks of acquiring other diseases, including heart disease and stroke, among others. In addition, poor oral health can directly impact nutrition, self-esteem, and mental health. Nationwide, less than 20 percent of seniors with incomes under the Federal Poverty Level saw a dentist in 2013.

In San Diego, a beacon of light for many seniors like Shirley has been the Gary and Mary West Senior Wellness Center, operated by one of the Gary and Mary West Foundation's flagship grantees, Serving Seniors. That nonprofit provides disadvantaged older adults with access to daily nutritious meals and to more than thirty nonprofit organizations offering comprehensive, holistic, and coordinated care such as clinical, behavioral health, housing, and other social services and supports.

Our founders, Gary and Mary West, and the entire foundation team regularly volunteer at the Senior Wellness Center. We see, firsthand, the many challenges of poor oral health care. Seniors who have not had good and regular care experience pain or have missing teeth, and this affects their ability to eat meals that the Senior Wellness Center provides. Others cover their mouths with their hands when speaking because they are so self-conscious about their teeth or have trouble swallowing food because of gaps in their teeth that prevent them from closing their mouths completely. Dental care is clearly a critical service these seniors need.

Our journey to develop an innovative approach to addressing oral health care needs was the subject of a February Grantmakers in Aging (GIA) webinar titled Reimagining Oral Healthcare for Our Nation's Seniors. We discussed how the West Foundation has already invested more than $1 million to create the state-of-the-art Gary and Mary West Senior Dental Center, which is scheduled to open later this year. The Senior Dental Center will be integrated within the Senior Wellness Center, so that community-based clinical, dental, and social services all will be provided under one roof.

Every senior who visits the Senior Dental Center as a client will receive a Comprehensive Geriatric Assessment designed to evaluate his or her functional ability and physical, dental, mental, and other socioenvironmental circumstances to ensure that he or she receives the right care at the right time. Our goal is to ensure that older adults receive the holistic care and services that allow them to stay healthy, regardless of their ability to pay for services.

We are also exploring which are the appropriate payment and reimbursement models to tackle the cost and access barriers that continue to be a challenge for seniors to receive proper oral health care. Medicaid only provides limited dental coverage that can vary by state and, unfortunately, these adult dental benefits can be unstable because they are vulnerable to being reduced or eliminated during periods of financial crisis when states constrain spending to balance their budgets. This happened in California in 2009, after which, for a period of five years, all adults on Medi-Cal (California Medicaid) had no covered dental benefits until 2014 when some of the adult Denti-Cal benefits were restored, but at reduced levels.

In California, dentists who accepted Denti-Cal were only reimbursed for 29 percent of commercial dental insurance charges in 2014. This has resulted in a lack of providers willing to accept Denti-Cal because the reimbursement rate is so low. Research conducted by the Gary and Mary West Policy Center in Washington, D.C., will help us advocate and work collaboratively with others to advance policies that have the greatest potential for increasing access to oral health care for seniors.

Through the shared efforts of the West Foundation, the related West Health Institute, and Serving Seniors, we are embarking on research studies to look at the impact this unique oral health and care coordination model at the senior center will have on seniors' health outcomes and quality of life.

Opportunities such as the GIA webinar help us build public awareness and provide a platform to invite others to join us in our work to advance a truly integrated approach to care that enables seniors to age successfully and protects their dignity, quality of life, and independence.

We want all seniors who are like Shirley-in downtown San Diego and around the nation-to have the opportunity for optimal health and well-being. Improving access to oral health care is essential to achieving this goal.

About That Cadillac Tax

In December 2015, Congress delayed implementation of the so-called Cadillac tax, a 40 percent excise tax on high-cost employer health benefit plans. Now scheduled to be implemented in 2020, the Cadillac tax would effectively cap the current tax exclusion for employer health benefits. By excluding health benefits from taxable incomes, the current tax break creates incentives for employers to pay more of employees' compensation via health benefits instead of taxable wages, possibly leading to overuse of health care services and driving up health costs.

Economists are generally keen to reduce or cap “tax expenditures,” like the current tax exclusion, to help prevent overuse of tax-favored items. We also tend to worry about the relative inefficiency of the health sector in particular, and the adverse impact of ever-higher health costs on federal and state budgets.

As a result, many prominent economists love the Cadillac tax. Former Treasury Secretary Lawrence Summers and Harvard economist Gregory Mankiw praised the Cadillac tax with bipartisan gusto in a recent op-ed. A long list of economists signed a letter urging Congress not to repeal it. Jason Furman, head of the Council of Economic Advisors, told The Boston Globe that the tax “is perhaps the single biggest leverage we have on health costs in the private sector” and issued a spirited and comprehensive rebuttal to the tax's critics.

However, these economists may be the tax's only supporters. Political leaders and presidential candidates on both sides of the aisle are in opposition. Labor unions and business groups fought to delay or repeal it in 2015 (Note 1). In response to concerns, the Administration has proposed a modification to the tax intended to reduce its burden in states with high health care costs.

There are two key practical issues with the tax: the indexing problem and the adaptation question. In our opinion, these are serious enough issues to warrant continued caution before implementing the Cadillac tax.

The Indexing Problem

The Cadillac tax was enacted as part of the Affordable Care Act (ACA), which set the tax's thresholds at $10,200 for single coverage and $27,500 for family coverage in 2018 dollars. The thresholds are set to grow by the consumer price index (CPI) plus 1 percentage point in 2019 and 2020, and by the CPI thereafter. Any health premiums above those thresholds would be taxed at 40 percent. Although health plans administering employer benefits would pay the tax, the cost would be passed through to the health plan enrollees.

Long-term projections from the Congressional Budget Office (CBO) currently foresee CPI growth of 2.4 percent per year beginning in 2019. Thus, the tax thresholds in 2020, the first year of the tax's implementation, would be about $10,900 for single coverage and $29,400 for families.

Although the tax would only affect the highest-cost employer health plans at first, most projections of growth in health insurance premiums range between about 4 and 7 percent per year. For example, CBO projects that premiums will grow by about 5 percent per year. Thus, over time more employer plans would be affected by the tax simply because its thresholds are indexed more slowly than plans' likely costs.

Furthermore, the distribution of premiums, even within industries, turns out to be very wide. Therefore, looking at averages only tells part of the story about which industries will likely be hit first and hardest by the tax. Exhibit 1 shows the range of premiums in each major industry group. For example, single premiums in the service sector ranged from a low of $2,000 to a high of $18,000 in 2014.

Exhibit 1: Range of Single Premiums by Industry, 2014

Source: KFF/HRET 2014 Employer Benefits Survey, calculations by INFORUM.

Exhibit 2 shows our reckoning of the percentage of employees affected by the tax, based on our forward model of 2014 Kaiser Family Foundation (KFF) data. When we say “affected,” we mean employees whose health benefits plan would trigger the tax if benefits were not modified or premium costs reduced in some way.

For this illustration, we used a medium-fast growth projection of 6 percent, a percentage point or so faster than CBO's baseline. But either way, with premiums expected to grow much faster than the indexing rate of the tax thresholds under either scenario, more and more firms and employees would be affected. For example, we estimate that over 70 percent of workers in the health care industry itself are in health plans that would be affected by the tax by 2030.

Exhibit 2: Percent of Employees Affected Under a Medium-Fast Premium Growth Scenario (6 percent), No Adaptation (Benefit Changes), and Annual CPI Growth of 2.4 percent

Source: KFF/HRET 2014 Employer Benefits Survey, model calculations by INFORUM.

It is notable that some of the keenest analysts of employer benefit and cost data have issued warnings about the indexing problem. Jon Gabel, who developed the benchmark KFF employer health benefits survey, issued an early warning that the Cadillac tax could become a “Chevy” tax over time. Gary Claxton, who now oversees the employer survey, reinforced Gabel's conclusion in a recent brief. Research from the Congressional Research Service using the Agency for Healthcare Research and Quality's (AHRQ's) Medical Expenditure Panel Survey's insurance component came to similar conclusions.

The Adaptation Question: Higher Deductibles or Innovations in Payment Systems?

It is certain that employers will adapt to the Cadillac tax by modifying their health plan offerings in some way. More work is needed to better understand what employers will most likely do. Some believe the tax will cause employers to find creative new ways to reduce health costs (and therefore premiums), as Jason Furman and Matthew Fiedler argue in their recent op-ed.

We worry the tax will cause employers to continue to shift costs to beneficiaries through higher and higher deductibles. There are several reasons why further increases in deductibles wouldn't necessarily be desirable.

First, we looked at the distribution of deductibles by premium level. Exhibit 3 shows the relationship between premiums and deductibles among manufacturing firms in 2014 KFF data. The inverted “S” curve shows single premiums ranked from the lowest on the left, to the highest on the right. Most manufacturers in 2014 had single premiums between $4,000 and $8,000. The blue dots represent the deductibles for each plan on the curve. Clearly, plans with the lowest costs tend to have higher deductibles, and plans with the highest costs tend to have lower deductibles. The relationship is indicated by the orange trend line. However, the pattern is not uniform. Quite a few high-cost plans already have high deductibles, and some low-cost plans have low deductibles.

Exhibit 3: Premiums vs. Deductibles, Manufacturing Industry, 2014

Source: KFF/HRET 2014 Employer Benefits Survey, calculations by INFORUM.

Note: Firm by firm results are arrayed on the horizontal axis from left to right by premium, from lowest to highest.

Gabel's report using KFF data also found that only a small percentage of the wide variation in employer premiums was associated with benefit levels (such as deductibles) in the first place. Instead, variations in premiums were largely due to the health status of enrollees, regional variations, or other factors. The wide variation in premiums and the fact that high premiums are not always linked with high benefit levels means that it will likely be difficult for regulators to fine-tune the Cadillac Tax toward only firms with extensive or lavish benefits, as opposed to firms that may have ordinary benefits but a sicker-than-average pool of enrollees.

Second, deductibles and other forms of patient cost sharing have already jumped in recent years, and it's not clear that high patient cost sharing only limits unnecessary or lavish care. A recent study followed a multi-year natural experiment where a large employer switched from a zero-deductible plan to a high-deductible plan. The reductions in care that resulted from the switch were across the board, among the sicker and the healthier, and among preventive and acute care services alike.

The employer in this particular study had high average worker incomes ($100,000+ median), and presumably a highly educated workforce. As such, it was striking that the deductible seemed to cause such a clumsy response. Other studies have had similar findings, and the conclusion that patient cost sharing is, at best, a blunt tool for restraining health costs dates back to the RAND Health Insurance Experiment.

As noted, Furman and Fiedler argue that, instead of causing employers to increase deductibles, the Cadillac tax will instead spark new payment arrangements designed to improve health system efficiency:

To realize the full potential for systemwide improvement, the private sector will need the right incentives to discover and deploy novel approaches to improving the health care system….. Unfortunately, the U.S. tax code has long undermined such incentives. Because employees pay income and payroll taxes on wages but not on compensation provided in the form of health care benefits, it is rational for employers to skew compensation packages away from wages and toward excessively costly and inefficient health benefits…..[Under the Cadillac tax] many employers will probably focus instead on encouraging more efficient care delivery, by deploying innovative payment models…. and finding creative ways to steer patients toward more efficient providers - investments that were often difficult to justify when the federal government was picking up much of the tab for inefficient care.

It's an interesting argument, but we don't think private insurers and health plans have been holding back on implementing innovative payment arrangements because of insufficient incentives. On the contrary, we have written previously about private sector approaches to improving care coordination and quality, and have worked with manufacturers implementing innovative health plans intended to control costs while fostering employee recruitment, health, and productivity.

In fact, we think some private health plans and their large employer clients were a bit ahead of Medicare in at least trying to spark innovative payment and reimbursement regimes with health care providers. What the private health plans lacked, however, was Medicare's market clout to really make the new systems stick and bring them to scale.

Watchful Waiting

Even if Furman and Fiedler are right, and the Cadillac tax would indeed sharpen private plans' incentive to implement payment systems that reward quality of care rather than volume, higher deductibles could still result.

When we saw the results of Inforum's Cadillac tax model, we were struck not only by the huge variation in premiums across firms and within industries, but also by the escalating nature of the tax, with a deeper and deeper bite each year due to the indexing problem. Absent additional deferrals or delays in implementation or adjustments to the indexing, even the most innovative firms could struggle to find alternative ways to cut costs quickly enough to avoid the tax, and might have to default to continuously higher deductibles.

Overly high deductibles, in turn, could become clinically inefficient. That is ever-higher deductibles could lead to the delay or avoidance of appropriate and necessary health care for too many patients, especially those with low incomes. In those cases, the deductibles could cause reductions in health status sufficient to raise overall or long-term health costs, not lower them.

On the other hand, the Administration's proposal to modify the tax thresholds in high cost states could relieve the pressure of the tax in places that would otherwise be hardest hit. However, that proposal has not been enacted in law, and we have not attempted to model its impact.

For several years, economists have expected a modest acceleration in health spending from its recent historically low growth. Although the volume of health care consumption has increased recently, and hospital employment started rising briskly in 2015, overall national health spending remains relatively restrained, at least compared with long-term averages.

Medical professionals sometimes use the term “watchful waiting” in clinical cases where potential interventions may be harmful or may turn out to be unneeded. Waiting for additional information on health costs and trends in employee health benefits before implementing the Cadillac tax would seem to make sense in this case.

Note 1

The National Association of Manufacturers (NAM) is one of the business groups opposed to the tax, and NAM funded Inforum's modeling of the tax's sectoral and economic impact.

The ACO Delusion

By ANISH KOKA, MD

Accountable care organizations (ACO's) promise to save us.  Dreamed up by Dartmouth's Eliot Fisher in 2006, and signed into law as a part of the Patient Protection and Affordable Care Act (PPACA) in 2010, we have been sold on the idea that this particular incarnation of the HMO/Managed Care will save the government, save physicians and save patients all at the same time.  I dare say that Brahma, Vishnu and Shiva together would struggle to accomplish those lofty goals.  Regardless of the daunting task in front of them, the brave policy gods who see patients about as often as they see pink unicorns, chose to release the Kraken – I mean the ACO – onto an unsuspecting public based on the assumption that anything was better than letting those big, bad, test ordering, hospital admitting, brand name prescribing  physicians from running amuck.

I realize I am being somewhat harsh towards the creators of the ACO morass.  But, while they all may be well-meaning, hard-working folks that own a Harvard crimson sweater, their intent is to fundamentally change how health care is provided – this mandates a withering evaluation.  As Milton Friedman aptly said, “One of the great mistakes is to judge policies and programs by their intentions rather than their result.”  Thus, with little regard to intent, and with an eye on the end result, I say unequivocally : ACO's do not work.

I didn't need big data to come to this conclusion.  It came to me as I reviewed the details of an ACO commercial agreement that offered an extra $4 per patient per month for successful care coordination combined with the delivery of an as yet undefined high value care metric.  The high priests that are only moved by mountains of evidence will look askance at statements like this because anecdotes like this have no real currency. The data, they preach, will cleanse, purify, and speak the truth. Small problem … the early results are in … and shocking no one who actually does care coordination, the results are not good.

Getting results on ACO's is not easy – ask Kip Sullivan.  Apparently, the smartest guys in the room who came up with ACO's designed a construct that is so complex, assessing their effectiveness may require building a large hadron collider.   The vehicle set in place by the ACA to provide for ACOs is the Medicare Shared Savings Program (MSSP).  This program allows provider organizations (ACO's) to share in savings with Medicare if spending is kept below a financial benchmark.  The details of how the financial benchmarks are set up are somewhat opaque, but essentially amount to Medicare using a pre-ACO-contract-initiation period to arrive at a spending average baseline.  Year over year changes in cost per beneficiary are then compared to the national average medicare spending growth.  ACO's that come in under the national average Medicare spending growth rate get to keep 50% of the savings that accrue to Medicare.  Based on these benchmarks the Center for Medicare and Medicaid Services (CMS) announced last year that in 2014 ACO's saved $411 million dollars.

There is, however, a significant problem with this approach.  ACO's are generally regional, and Medicare spending patterns vary widely by zipcode.  It is not the best idea to compare ACO's in regions with high cost growth to national spending growth patterns.  A much more valid comparison would be to compare ACO costs with non-ACO costs within the same region.  This is exactly what authors of a recent study in the NEJM attempted to do.

The authors looked at the medicare claims and enrollment database to calculate spending per medicare beneficiary by region in ACO patients and non-ACO patients.  They examined ACO's based on when they began (2012, or 2013), and looked at 2013 spending average data.

The grand total savings per beneficiary in the group of ACO's that joined in 2012 was $144 (- 1.4%).  ACO's that joined in 2013 saved $3.  To rub salt in the wounds, there was also no real difference seen in 'high value' care provided to patients (hospitalizations, 30 day readmissions).  I hedged on the differences in high value care when I probably shouldn't have – the ACO folks did get their LDL checked more often – yes, that was a metric of high quality care.  The savings estimated for the 2012 ACO group was $238 million dollars, but unfortunately, there was no net savings because Medicare paid $244 million in bonuses to ACO's.  The study also gave no dollar value to the cost of setting up the ACO – one assumes someone is paying for that?  The only silver lining I could find in the study was a subset analysis that showed significantly greater savings for independent primary care groups compared to groups integrated with hospitals.

To summarize:

• ACO's that joined in 2012 demonstrated savings of $144/beneficiary


• ACO's that joined in 2013 saved $3/beneficiary


• There was no meaningful difference in value delivered to patients within ACOs


• There were no net savings to Medicare after accounting for bonus payments paid to ACO's


• ACO's that consisted of primary care physicians saved significantly more money than groups integrated with hospitals

This early data should give policy makers pause.  This was not a positive study, and it importantly re-enforces some significant concerns for physicians that are at the tip of the health care delivery spear.  These concerns may be difficult to comprehend to the folks making decisions at one thousand feet… so allow me to take you to ground zero.

Ground Zero: The Story of Mrs. K  

I received a message Saturday morning from my answering service.  Mrs. K wanted to speak to me.  I happen to be Mrs. K's third cardiologist.  I met her 2 weeks ago.  She had gained 20 pounds over the last 3 months, had a kidney transplant, severe aortic stenosis and had a systolic blood pressure that stubbornly stayed above 200mmHg.  She had shortness of breath just getting out of bed to go to the bathroom, and my fingers sunk in to her legs as if they were a memory foam mattress.  It didn't take me long to discover why I was her third cardiologist.  She refused to listen to any of my suggestions, and went on to discount the reasonable suggestions of her prior cardiologists. She had a 'reaction' to almost every medication I suggested, and she decided on a daily basis if she would take the medicines that were prescribed to her.  It took a combination of cajoling and threatening to finally have her trust me enough to come into the hospital.  It took even more convincing – sometimes on a twice daily basis – in the hospital to get her to take the medications as prescribed.  She improved markedly and was able to be discharged.  Of course, this was just the start of our relationship.  My office reached out almost every day to check her weights, and to re-enforce the need to take her medications.  I called her back on Saturday, and listened, sometimes impatiently, while she relayed to me her feeling of chills that were definitely due to the pills I was administering.  I tried to reassure her and implored her to stay the course.

I guess this is called care coordination.  I just call it taking care of a patient. It is too early to know what will happen to Mrs. K.  A hot dog's worth of sodium may be enough to have her end up in the hospital again. Beyond the somewhat inconsequential debate about whether or not the patient would be attributed to me in a way that would allow me to share in some cost savings is the larger point that I could care less if Mrs. K was within an ACO or not.  The ACO, in its current incarnation, does nothing to help me take care of Mrs. K.  Those millions of dollars to the ACO's?  If  your patient belongs to a hospital-run ACO, most of the Medicare cost savings do not end up with the physicians in charge of delivering high value care at a reduced cost.  Let's take my regional ACO – 30% of savings go to the ACO, 30% to those investing in the ACO (hospitals), and 40% to physicians.  Any wonder that $4 per month is what's left over after everyone has taken their cut?

I think the biggest sin the ACO's commit is to distract from any real conversation about cost.  There is plenty of cost savings to be had within the current construct, but we the public (Jim Purcell explores this well in his recent article) don't want to make hard choices.  We are a wealthy society, and a wealthy society prizes its health.  In India, a rise in the price of onions is cause for rioting.  In the great United States, suggesting mammograms not be covered until age 50 may result in charges of misogyny by liberals, and charges of fascist death panels by Palin republicans.  Even the interventions that wouldn't cost the public anything sit behind walls guarded by special interests.  Currently, a significant pay differential exists between services provided by hospital-based outpatient departments (HOPD) and freestanding, physician-owned clinics.  This means that the same echocardiogram provided in the same venue by the same people is many times more expensive if a hospital owns the clinic.  This is not a secret.  The Medicare Payment Advisory Commission (MEDPAC) has advised Medicare of this no-sense differential every year since 2012.  Hospitals have resisted attempts to cut this vociferously, and successfully.  But never you mind – just remember – the ACO will save us.

Anish Koka is a cardiologist based in Philadelphia.

Typhoid fever

Typhoid fever: An acute illness characterized by fever caused by infection with the bacterium Salmonella typhi. Typhoid fever has an insidious onset, with fever, headache, constipation, malaise, chills, and muscle pain. Diarrhea is uncommon, and vomiting is not usually severe. Confusion, delirium, intestinal perforation, and death may occur in severe cases. The disease is transmitted through contaminated drinking water or food. Large epidemics are most often related to fecal contamination of water supplies or foods sold on the streets. A chronic carrier state'excretion of the organism for more than a year'occurs in approximately 5 percent of cases. Vaccination is recommended for people traveling to high-risk areas, such as the Indian subcontinent and developing countries in Asia, Africa, and Central and South America where there is prolonged exposure to potentially contaminated food and drink. Typhoid vaccination is not 100 percent effective and is not a substitute for careful selection of food and drink.

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Acid reflux

Acid reflux: A common condition and an abnormal one in which acid in the stomach rises up into the esophagus. This occurs because the valve separating the contents of the stomach from the esophagus does not function properly. See also: GERD.

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A Spoonful of Inequality Helps the Medicine go Down

By SAURABH JHA, MD

The conventional wisdom in the circles I hang out in – pro-Hillary, morally conscious,happy bunnies who pretend to enjoy French wine and opera – is that the greatest scourgeon humanity after the bubonic plague is inequality of wealth. They worship Pope St. John Paul Piketty and canonize Archbishop Paul Krugman. Not only is inequality bad for its own sake, they say, it makes people ill, like medically ill.

Their premise always struck me as specious. I once took them through a thought experiment. Imagine, I said, you time travel to the Bengal famine. There was a lot of equality then – people were equally malnourished. Everyone's ribs protruded equally because of muscle wasting from marasmus. The loss of protein from kwashiorkor made sure everyone's belly popped out without prejudice. Starvation because of poverty is a great leveler. It cares little about gender, caste or religion. It is non-judgmental.

You say to a starving Bengali: “I have a solution. It'll give you food, occasional shelter, internet and a mobile phone.But here's the catch. An ostentatious billionaire called Mukesh Ambani will own the most expensive house in the world, and because you'll be reminded of his house, you might feel like crap. You'll live longer, be well fed, perhaps overfed, but will feel like crap when you see someone driving a Mercedes. Want it? It's called capitalism.” I suspect the starving Bengali might say “hell yes, please bring on inequality. I want food. I don't give a damn about Ambani.”

Inequality affects tenured Ivy League professors, not rickshawallahs in India. You can understand why. It's painful for the professor to sit in airline's economy class drinking Chivas Regal Red Label (it's hideous, BTW), whilst the undeserving 1 % drink Blue Label in business class. The rickshawallah in India doesn't suffer from the maladies of the almost hyper affluent.

The response to my thought experiment was “yeah, yeah.” I was dismissed as a ranting, remorseless Scrooge. A landmark study by an economist, Raj Chetty, in JAMA will give me the “told you so” satisfaction. The study looked at income and life expectancy. The richest 1 % males live, on average, 15 years more than the poorest 1 % males.

This isn't surprising, but the researchers found more. They found that the life expectancy of the poor depended,not on the degree of income inequality perse, but where the poor lived. The plot thickens….

The poor who live near neighborhoods (commuting zones) with highest life expectancies – i.e. affluent neighborhoods – live longer than the poor who live near neighborhoods of the lowest life expectancies. The poor live longer in New York than Detroit.

Let me repeat: the poor who live near the rich live longer.Get it? Those who stare at that carcinogen called inequality live longer than those who don't.

The study decimates a narrative pervasive in medical and public health circles, which has escaped scrutiny because it is camouflaged by nobility – inequality (relative poverty) leads to ill health.

Mistaking morality for signal is an easy trap to fall into. And, to be fair, Chetty eats all ideologues for breakfast. After reading Chetty's study, in Bayesian speak, everyone should update their priors, and have a new posterior. He has renewed my faith in health economists without whom moralizers, proselytizers and supply side Laffer curvers will run healthcare amok with their agenda-driven dodgy theories.

Chetty finds that life expectancy for the poor doesn't correlate with access to medical care. Which means that the primary reason the poor are dying sooneren masseisn't because they can't access the emergency rooms on time, or because they lack insurance. Sorry Obamacare.

The study vindicates the objection to using life expectancy as a metric for quality of medical care when comparing the US with other industrialized nations, since life expectancy for populations is barely affected by quality of medical, such as ICU and trauma, care.

The rising tide lifts all boats, even though the tide lifts some boats more than others, and some not at all. Shetty found that the rich aren't just getting richer but becoming more immortal. Between 2000 and 2014 the top 5 % gained 3 years of life expectancy and the bottom 5 % gained piddles. In some areas people have a lower life expectancy in 2014 than they did in 2000. So much for trickle-down economics, which, BTW,should join the flat earth society.

Why are the poorest 1 % not living as long as the richest 1 %? The easy answer is “habits.” The rich have different, life-enhancing, habits. They don't smoke. They drink in moderation, and exercise. Conservatives might say the rich make better choices. But that answer is as pathetically naïve as blaming inequality. Habits don't arise from thin air. It's easier cycling when you have a bike path than when dodging bullets. Bike paths are more common in or near affluent neighborhoods. Affluent? There you go – it's inequality all over again.

Bike paths are necessary, not sufficient. The will to ride bikes must exist. That will is driven by habit, but also by hope – hope about the future. Hope needs aspiration. To induce aspiration you need education – proper schools – and jobs.Incidentally, Chetty found no correlation between life expectancy for the poor and unemployment, but my prior about the necessity of jobs is so strong that I'll just ignore that finding.

What's the policy solution? It lies in the ideology of the beholder. The tirelessly moralistic Vox is still tediously harping on about inequality. Let me state, in no order of prejudice, what won't help the poor much: more hospitals, bicycle helmets, screening, millennials fretting about names associated with historical wrong doing, and occupying Wall Street. Sorry social justice warriors – all of that righteous rage may have been for naught.

This is speculative. The problem is absolute, not relative poverty. The poor need an infrastructure of hope. They need schools with quality teachers. They need public parks. They need the government to invest in public works to create jobs. There are three reasons to connect the entire US with rail: jobs, jobs and jobs. They need the rich not to be segregated in enclaves where they self-flagellate about inequality, whilst drinking Dom Perignon and discussing chess camps for little Raj and ballet classes for little Rashmi. They need the rich to be living near them and not inside gentrified zip codes. They need the rich to use the same supermarkets, drink in the same pubs, eat at the same salad bars,and send their kids to the same schools.

The right, cheer lead by the metronomically one-sided Wall Street Journal, must be intellectually honest about taxation, and support public works and education. They have opposed higher taxes by appealing to the negative undertones of redistribution, and to theories which are partially, very partially, accurate such as the Laffer curve.

The poorest 1 % Americans live to 72 years which is, of course, longer than people in the Caucuses lived during Genghis Khan's reign of terror, but no longer than war-stricken Sudanese. Hardly American exceptionalism.

Neither is equality good for its own sake nor is inequality bad for its own sake. Inequality is a consequence, not a cause. Inequality is bad if society becomes ossified – like a caste system – which America is becoming for reasons more complex than income disparities. The poor must be able to get on the conveyor belt to better opportunities. Don't demonize the destination. Fix the conveyor belt.

Saurabh Jha is a physician and contributing editor to Healthcare Blog. He is currently suffering from a crisis in political economy, which is like an identity crisis but much worse.

He can be reached on Twitter @RogueRad. This piece originally appeared in 3 Quarks Daily.

New Health Policy Brief: Medicare's New Physician Payment System

A new policy brief from Health Affairs and the Robert Wood Johnson Foundation (RWJF) provides a primer on the Medicare payment part of the Medicare Access and CHIP Reauthorization Act (MACRA) of 2015. For more than two decades, Congress and the federal government have struggled with how to reimburse providers in the Medicare program and at the same time promote high-quality care that uses medical resources judiciously.

Revising Medicare fee schedules has been a perennially thorny political ritual. While MACRA passed both houses of Congress with overwhelming bipartisan support, a request soon after the law's enactment from the Department of Health and Human Services (HHS) for information on how the law should be implemented yielded hundreds of comments from most major stakeholders, signaling both areas of agreement and of tension.

The brief describes the formula MACRA will use to give physicians fee increases and it illustrates its implementation timeline. It explains how physicians will need to enroll in the Merit-Based Incentive Payment System (MIPS) or join an alternative payment model.

About Health Policy Briefs

Health Policy Briefs are aimed at policymakers, congressional staffers, and others needing short, jargon-free explanations of health policy basics. The briefs, which are reviewed by experts in the field, include competing arguments on policy proposals and the relevant research supporting each perspective.

Sign Up For Health Policy Briefs

Sign up for an email alert about upcoming briefs. The briefs are also available from the RWJF's website.

Please feel free to forward the briefs to any of your colleagues who are tracking health issues. And after you've taken a look, we welcome your feedback.

Pfeiffer syndrome

Pfeiffer syndrome: A syndrome of craniosynostosis (premature fusion of the cranial sutures) due to mutation in FGFR (fibroblast growth factor receptor) characterized by bulging eyes (proptosis) due to shallow eye sockets, underdevelopment of the midface and broad short thumbs and big toes.

There are three types of Pfeiffer syndrome:

• Pfeiffer syndrome type 1 -- The intellect is usually normal. There is moderate to severe underdevelopment (hypoplasia) of the midface, broad and inwardly deviated thumbs and big toes with variable degree of shortening of the digits (brachydactyly). Hydrocephalus and hearing loss may also occur.

• Pfeiffer syndrome type 2 -- Developmental delay and mental retardation are common. There is a cloverleaf skull and extreme proptosis. The thumbs, big toes and other digits are as in type 1 but there is also ankylosis (fusion) of the elbows and knees.
  Other problems may include narrowing or closure of the nasal passages, laryngeal and tracheal malformations, hydrocephalus and seizures.

• Pfeiffer syndrome type 3 -- There is a tall short skull (turribrachycephaly). All other features are as in type 2.

Pfeiffer syndrome is inherited in an autosomal dominant manner. Type 1 is due to mutation in the FGFR1 and (more often) FGFR2 genes. Types 2 and 3 are due to mutation in the FGFR1 gene.

The health care of children with Pfeiffer syndrome is often best managed by a multidisciplinary team which may include a neurosurgeon, plastic surgeon, otolaryngologist, dentist, audiologist, speech pathologist, pediatrician, and geneticist. A dozen or more surgeries may be required over a lifetime. The first surgery is usually to relieve the premature fusion of the cranial sutures. Hydrocephalus, upper airway obstruction, and exposure of the cornea by the proptosis may require shunting, tracheostomy, and surgical eyelid closure, respectively.

The prognosis (outlook) is most favorable with Pfeiffer syndrome type 1. Types 2 and 3 carry an increased risk of early death.

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Accountable Care Organizations In 2016: Private And Public-Sector Growth And Dispersion

As of the end of January 2016, Leavitt Partners, in partnership with the Accountable Care Learning Collaborative, has identified 838 active Accountable Care Organizations (ACOs) (see Figure 1) across the country with service areas in all 50 states and the District of Columbia (see Figure 2). Collectively, the count of ACOs has grown by 94 over the past year, an increase of 12.6 percent. Growth has continued to vary across the country and across public and private health insurance programs, with significant growth in most population centers but increasing activity in some rural areas.

Figure 3 includes counts of ACOs by hospital referral region (HRR); it shows that some markets have significant activity among providers in the region while accountable care has failed to take hold in other regions. In addition to the increase in ACOs, the number of accountable care contracts has continued to grow, with 1,217 identified accountable care contracts.

Figure 1 – ACOs Over Time

Figure 2 – ACOs By State

Figure 3 – ACOs by Hospital Referral Region

ACO Lives

The growth in ACOs has coincided with a growth in the number of lives that are covered by ACO contracts as seen in Figure 4. Leavitt Partners estimates that 28.3 million people are now covered by an accountable care arrangement. In contrast to previous years, we now estimate total lives at the contract level, rather than the organization level, which allows increased precision. Our approach also allows a more granular analysis of the types of contracts, as seen in Figure 5, with a breakdown of lives covered under commercial, Medicaid, and Medicare contracts.

On January 1, 2016 a new cohort of Medicare Shared Savings Program (MSSP) Accountable Care Organizations (ACOs) joined that ACO program. As the program had now been in operation for three performance years, early joiners of the program also had the opportunity to renew their contracts for another performance period. While many chose to do so, some dropped out of the MSSP or Pioneer ACO programs. On net, however, the number and covered lives in Medicare ACO programs has continued to grow steadily.

Even though the MSSP receives the most attention, commercial contracts tend to be larger. They collectively represent a larger portion of ACO lives (Figure 5), and also continue to grow significantly.

Figure 4 – ACO Lives Over Time

Figure 5 – ACO Lives Per Payer

Geographically, the total number of lives closely follows the count of ACOs, but ACO penetration-the percentage of lives in a market that are covered by an ACO contract-varies (see Figures 6 and 7). (As noted, our method for estimating lives has shifted from the organization to the contract-level compared to previous years' estimates.) High penetration may be driven by competition among multiple providers within a market who are all adopting accountable care contracts, or it can be driven by a single ACO run by a dominant provider that is able to take risk for a large portion of the population.

States that have adopted Medicaid ACOs, such as Oregon, also tend to have higher penetration. Nationally, 8.9 percent of the population is covered by ACOs; while ACOs are a growing model, they are far from the dominant model for health insurance coverage.

Figure 6 – ACO Penetration by State

Figure 7 – ACO Penetration by Hospital Referral Region

Important Developments

Renewals And Dropouts

One important indication of the success of the early ACO initiatives is how many renew their contracts when they have the option of leaving an accountable care program. Of the 220 Medicare ACOs that were eligible for renewal, 147 renewed in the MSSP, eight transitioned to the Next Generation ACO program, and an additional 10 combined or merged with other ACOs. Collectively, three-fourths of the early Medicare ACOs are continuing onward with a Medicare ACO program. In addition, a number of those that have left the Medicare program continue to have commercial ACO contracts, indicating that ACO policy refinements may further increase participation.

Fully adopting accountable care and successfully transforming a practice to achieve savings is difficult, with mixed results among participants. Many ACOs have not succeeded, and it is likely that more ACOs will ultimately be unsuccessful at making this transition. Other ACOs will likely drop out of government and commercial contracts in the future. But knowledge about how to succeed as an ACO will continue to increase, and organizations that dropped out will have the opportunity to try again in the future in modified ACO programs. Thus, many organizations will iterate as they learn how to make their transition to accountable care.

Policy Drivers

2015 saw the announcement of several important government policies. From the administrative side, Secretary Burwell announced the Department of Health and Human Services' (HHS) goal to move 50 percent of Medicare payments toward risk by 2018. HHS recently announced that they have achieved their interim goal of 30 percent ahead of schedule. Our figures indicate that the Medicare ACO programs have been the principal contributor to achieving this goal, with approximately 22 percent of Medicare beneficiaries in 477 Medicare ACOs.

HHS also announced the Comprehensive Care for Joint Replacement (CJR) program that will require that hospitals in 67 geographic markets to accept financial risk for hip and knee replacements with its mandatory 90-day bundling program. The administration has continued to develop and expand initiatives that involve provider accountability for spending and population health results via alternative payment models.

On the legislative side, Congress has reinforced this trend with the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA). The bipartisan bill (passed 92-8 in the Senate and 392-37 in the House) was noted for repealing the unpopular sustainable growth rate (SGR) formula, but it replaced the fee-for-service (FFS) payment system for physicians with a framework that may lead to a more fundamental shift to alternative payment models based on quality and outcomes performance: FFS payments will be increasingly adjusted based on quality and value performance; the other option for physicians, further encouraged by a significant bonus payment, is to move to population-based alternative payment models (APMs) that involve significant financial risk.

Supporters of MACRA from both parties have highlighted the intent to better align Medicare with private-payer approaches to transforming the broader health care system. Specifically, under MACRA an organization can qualify for APM bonus payments, paid by Medicare, by moving their non-Medicare lives to APMs, not just by changing how they receive payment for their Medicare population. This incentive has the potential to significantly further the adoption of APMs, including ACOs.

Looking Forward In 2016

New Administration

This year will see the election of a new presidential administration and Congress, which will allow many new policies to be implemented, old policies to be changed, and-perhaps-new legislation to be enacted and past legislation to be repealed. Regardless of the next president, we expect accountable care to continue to grow. As indicated by the passage of MACRA, there is strong congressional pressure to hasten the transition toward paying for care based on the value created.

A new administration could make changes to current government ACO programs-for example, increasing the role of beneficiary engagement and shared savings from choosing less costly care-but would not be able to make fundamental changes to the direction of payment reform without legislation. Apart from federal government activity, commercial payers and state payers in both Democratic- and Republican-governed states are continuing to push toward accountable care.

Combining Payment Reform with Delivery Reform

The objective of accountable care payment reform is to support improvements in the delivery of care, which leads to some confusion as the ultimate objective is delivery reform. Accountable Care Organizations consist of health care providers that accept financial risk for the total cost of care delivered to a defined population. They come in various configurations of provider members, including physician groups, hospitals, post-acute care providers, behavioral health providers, and many others. The common thread is the contract arrangement that provides incentives for the provider to improve the quality and lower the cost of care of their population.

As public and private payers gain experience with accountable care contracts, we expect to see further revisions in accountable care payment models. For example, CMS recently announced a set of reforms in benchmark calculations and other aspects of Medicare ACOs, based on its experience to date. Public-private collaborations like the Health Care Learning and Action Network are identifying further steps that could accelerate the adoption of payment reforms.

At the same time, the actual mechanisms that providers are taking to transform the delivery of care vary - not only based on the details of their payment contracts, but also their organizational structure, prior experience, local market conditions, and countless other factors. The real objective of accountable care is to support health care providers in implementing needed reforms in health care delivery. Transforming how medicine is practiced is a concurrent challenge to implementing effective payment reforms.

Despite the proliferation of ACOs and refinements in ACO contracts, the practice of changing health care delivery is still nascent with much work left to be done. The ultimate impact of the accountable care movement will depend on the success or failure of delivery reform. Many organizations, such as the Accountable Care Learning Collaborative as well as many private ACO enablers, are actively working on delivery issues. Nevertheless, progress is difficult, especially in the short term and with limited resources, and not all organizations will be successful at lowering costs or improving quality. Success is not simply moving risk to providers for a population, but improving the delivery of care for that population, and we still have much to learn.

Accountable Care Organization Challenges

As accountable care payment mechanisms become more widespread and mature, we expect attention will shift to the challenges facing providers in adapting to such mechanisms. ACO leaders face many challenges in redesigning care, including achieving organizational buy-in, using technology to manage a population, and aligning intra-organizational incentives - all while making measurable progress on quality and cost.

At the heart of becoming an ACO is changing how an organization operates. Organizational change is hard in any industry, but it is exacerbated in health care due to the fee-for-service infrastructure that has been designed over decades to focus organizations on volume. Shifting from that focus requires a significant amount of structural change, but more importantly it requires individual providers to change how they practice medicine.

Historically clinicians have operated relatively autonomously with a one-to-one, patient-provider relationship, with someone else left to worry about the overall population consequences. With provider organizations increasingly focused on population-level results, that mentality is changing to include a many-to-many approach involving a group of providers that must collectively work together to manage a population of patients. Changing the fundamental practice of medicine takes buy-in, effort, and significant time to accomplish.

For example, to effectively manage a population, a successful ACO must first understand their population, which requires developing and using health information technology (IT) in new ways. Selecting, implementing, and maintaining connected electronic data to support population health platforms remains a challenge, with both providers and the vendors creating new products and refining data-sharing and analytic technologies.

More importantly, ACOs must learn how to identify key data and act on it in a way that measurably improves the care of their population. Aggregating the data is technically challenging, but effectively prioritizing and operationalizing findings is a new skill set that providers are being forced to develop - and better health IT and analytics is only one of the many new capabilities that health care providers must develop to improve population health.

The basic tenet of accountable care is that changing how providers are paid enables them to shift resources to provide care in better ways, ways that were previously not financially sustainable. Figuring out the specific steps to implement those new changes in practice is much more challenging. ACOs, which bear risk at the organizational-level for the financial outcomes of the population, must grapple with how to share that risk with individual providers or practices.

Financial incentives do lead to changes in behavior, but more important is for ACO providers to accept responsibility for the care and health outcomes of the broader population. Individual providers, for example, may be more incented to change their behavior based on how their patients' outcomes compare to those of their peers' patients than by any financial incentive. Each organization must discover the appropriate incentives to change behavior.

Future Of Accountable Care

Over the past year the conversation around ACOs has shifted. ACOs have continued to grow, and ACO payment policies are evolving. Along with that, providers, by and large, have begun to think about population-level payments as an eventuality as opposed to just a possibility. Policy pressures will continue to encourage this transition, but there is also a growing recognition that managing a population is a better way to care for patients and most providers aspire to deliver the best care possible.

There remains much to learn and even more to implement, but moving American medicine toward a population-level model is the direction we, as a broader health care system, are heading.

How Things Get Done In Washington: Insights From 23 Former CMS Leaders

If you like the series House of Cards, or perhaps you simply want a better understanding of how things get done in Washington D.C., you may want to check out a new resource from the National Academy of Social Insurance (NASI). Insights from the Top: An Oral History of Medicare and Medicaid is a series of 23 individual interviews with former administrators and acting administrators of the Centers for Medicare & Medicaid Services (CMS) and its predecessor, the Health Care Financing Administration (HCFA). NASI conducted the project as part of its celebration of the 50th anniversary of Medicare and Medicaid.

Particularly notable are interviews with the officially confirmed administrators - Leonard Schaeffer (1978-1980), William Roper (1986-1989), Gail Wilensky (1990-1992), Bruce Vladeck (1993-1997), Nancy-Ann DeParle (1997-2000), Thomas Scully (2001-2004), Mark McClellan (2004-2006), Donald Berwick (2010-2011), and Marilyn Tavenner (2011-2015). Some of the most candid insights also come from the career civil servants who stepped in as acting administrators - William Toby (1992-1993), Michael McMullan (2001), Kerry Weems (2007-2009), and Charlene Frizzera (2009-2010).

Former CMS/HCFA Administrators: (standing, L-R) Bruce Vladeck, Mark McClellan, MD, Gail Wilensky, Leonard Schaeffer, Nancy-Ann Min DeParle, Don Berwick, MD; (seated, L-R) Bill Roper, MD, Marilyn Tavenner, Tom Scully. (Photo made possible by Leonard Schaeffer).

The interviews, conducted by Edward Berkowitz, professor of history at George Washington University, give us a first-person perspective into the transformation of the American health care system. There are a number of themes that Berkowitz consistently draws out of his interviewees. I highlight a few examples below.

Art Of The Deal: The Affordable Care Act

Across several interviews, we hear about how the failure of the Clinton Administration's health care reform effort influenced the Obama Administration's approach to securing passage of the Affordable Care Act (ACA). While many former Clinton officials went on to serve in the Obama Administration, no figure is quite as integral as DeParle. She provides a compelling account of her experience at the Office of Management and Budget (OMB) and HCFA, and how it influenced her decisions as one of the chief negotiators of the Affordable Care Act.

Both DeParle and her deputy, Michael Hash, describe dynamic interactions with the House and Senate. DeParle notes the strong impact of Speaker Nancy Pelosi's leadership in avoiding the jurisdictional quagmire that lead to failure in the past. Hash answers the question on whether the long days and nights at the White House were worth the sacrifice when he describes the midnight champagne toast made by President Obama to the White House health reform team on the Truman balcony after the passage of the Affordable Care Act.

Prior White House Experience Not Required, But Helpful

Many Administrators had prior White House experience (Roper, Scully, Wilensky, DeParle, and McClellan, for example) that had a profound impact on how they approached politics and health care policy making. One of the most interesting discussions is Scully's work with Presidents George H.W. Bush (41) and George W. Bush (43).

Wilensky and Scully both describe President Bush (41) as someone who was intimately involved in key health policy issues, including saving the Catastrophic Coverage Act, revising physician payments, and the passage of the Americans with Disabilities Act. McClellan and Scully both attest to President Bush's (43) strong interest in expanding the program to include prescription drugs which ultimately resulted in the passage of the Medicare Modernization Act.

President Bush (43) set clear policy objectives to modernize the Medicare program as efficiently as possible. McClellan, who served in both the Clinton Administration (Treasury Department) and Bush Administration (Council of Economic Advisors), went on to lead the Food and Drug Administration and then to CMS to implement the prescription drug benefit. In one of the most vivid examples of how life can impact policy, McClellan tells the story of how he was dispatched to the corner of 17th street and Pennsylvania Avenue (in front of the White House) to investigate a protest by a group called ADAPT, which ultimately resulted in the Administration's Initiative for “Money Follows the Person” to allow individuals with disabilities to stay in their home.

Change Management

Leonard Schaeffer, William Roper, and William Toby each provide unique perspectives on how academia, government, and the private sector intersect in policy development. Toby gives witness to how the decentralization of HCFA impacted his management style as Administrator, which resulted in the development of the agency's strategic plan which still helps guide its principles today. I was particularly struck by Toby's description of his experience with the National Urban League and being a soldier in the civil rights movement. He provides a powerful testimony to the Johnson Administration's efforts to create more opportunities for African Americans in the senior management levels of federal government.

Schaeffer and Roper discuss the need to align incentives that led to the evolution of capitation payment and its impact on models of care. Schaeffer notes that former Administrators meet periodically to discuss policy and often lend support to the incumbent regardless of party affiliation. Roper also comments on the unique “club” of former administrators. Schaeffer observes of his post-public service life that you either stay in Washington to fight or by “virtue of not working in DC, but having real health care experience elsewhere, be considered an expert.” Roper's interview shares his perspective on managing the largest payers and providers besides HCFA, including Prudential and the University of North Carolina Health System.

Each interviewee praised the dedicated men and women who work at CMS. NASI's Insights from the Top provides us with some of the best examples of public service, whether Democrat or Republican, that this country has to offer.