There are downsides other than cost to unnecessary screening tests. Positive results can lead to invasive, dangerous and expensive follow-up tests along with anxiety.

One organization, Health Fair runs buses in the Washington, DC region that offers a package of five tests for $139. The US Preventive Services Task Force recommends against all five of these tests. Abnormal results of one kind or another are found in almost half of all patients screened. You can bet a whole lot of those are false positives or minor issues that are best ignored.

I’m gals to see Kaiser Health News go after this kind of story so people are aware that what looks like a friendly, innocuous service may be something less positive.

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By David E. Williams of the Health Business Group.

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I don’t really have a problem with doctors who want to have a life outside medicine, but overall I prefer to be treated by someone who’s really dedicated and wants to devote most of their waking hours to it. By the way I feel the same about other professionals I work with.

So I’d like to see some of the structural issues addressed to encourage those who want to go all out to do so. Kaiser Health News has an article on the topic today (Doctors Transform How They Practice Medicine), which gets at my point at least indirectly. The article discusses how physicians are opening “medical homes” to provide more coordinated care or opening concierge-style practices that limit the number of patients and charge extra fees.

Those are both kind of interesting but also a bit ho hum. I’d rather see a broader array of offerings including those that include more remote services and incorporate specialty care. I hope and think they’ll come because despite the fact that many docs are rushing into hospital employment, I believe many would rather work for themselves if there were a viable way to make it happen.

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By David E. Williams of the Health Business Group.

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Don’t expect a government policy solution anytime soon. So do your best to obtain health insurance and disability insurance and to set aside a rainy day fund.

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By David E. Williams of the Health Business Group.

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Opponents of the law have been making a big deal out of how it will harm businesses and stop their growth plans. But even though today’s Wall Street Journal article (Eateries Fear Health Law’s Bite) starts to take us down that well-trod path, if you read it closely you’ll see there’s little to fear.

The article leads off describing East Coast Wings & Grill, which is temporarily limiting its franchisees to ownership of 3 to 5 stores due to uncertainty about whether the stores are viable when they need to pay for insurance. The International Franchise Association shares survey data indicating 72 percent of franchisees say the law creates “some” or “significant” uncertainty for long-term planning. Rat burger purveyor White Castle is also planning to slow down its expansion.

Overall it’s a pretty feeble argument against ACA expansion. Certainly there are other things prospective Wing operators and franchisees in general are uncertain about, including the cost of food and how the sequester will impact the economy. It’s convenient to blame the Affordable Care Act for a chain’s problems. But if it weren’t that we might be hearing some other explanation, like bad weather.

Interestingly, the more well-established chains don’t seem overly worried about ACA. Wendy’s, Dunkin Donuts and McDonald’s are all aware of ACA and making plans for the modest impact it is likely to have.

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By David E. Williams of the Health Business Group.

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The path we’re on now in the US and Europe is to ape the experience with small molecule products by introducing generic versions as patents expire. As I’ve discussed in the past, this is a bad idea. Development costs are high, manufacturing is notoriously difficult, and the products won’t be identical anyway. That’s why the products are called “biosimilars.” As a result the products are going to be expensive –we won’t see nearly the costs savings as we do with small molecule products, and FDA will be stretched too thin monitoring the manufacturing facilities. Instead I propose to allow branded products to maintain their monopoly after patent expiration, but to regulate pricing.

Recently I’ve been thinking this through a little bit more and have become even more troubled by the idea of biosimilars. In particular I’m concerned about the ethical and practical issues of conducting clinical trials for these products.

Patient recruitment is a challenge for most clinical trials, and as a result studies are frequently delayed. A key problem is that few development-stage therapies offer significant improvements over what’s already on the market, so there is limited enthusiasm to participate in a study that has little reward but also includes risks. Doctors don’t feel comfortable recommending that patients enroll, and patients are understandably hesitant, too.

The challenge for bio-similar trials will be even harder. It’s hard for me to understand why a patient would want to join a trial just to help prove that a new therapy is very similar to an existing therapy. I suppose it’s possible that a biosimilar product could be a little better in specific instances, but mostly these trials will just attempt to prove a new drug is the same as the old.

The ethical issue is related to the practical one. If there’s no upside to joining a trial, is it reasonable to ask a patient to take on any extra risk, such as the risk that the product doesn’t work or makes them sicker? I kind of doubt it.

At the end of the day, I feel more strongly than ever that biosimilars and biogenerics  are a foolish and pricey prospect.

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By David E. Williams of the Health Business Group.

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The JAMA article indicates that only three percent of these cases were not treated. To me that indicates three things: a general bias toward action in American medicine, a special fear of cancer, and the financial incentives to perform procedures. I agree with the NY Times suggestion that we use the term “abnormal cell clusters” rather than cancer, since they are so unlike other more dangerous cancers.

It’s worth keeping situations like this in mind when considering how to restructure Medicare, which will be necessary in order to get the federal government’s finances in line.More cost sharing and the promotion of shared decision making for conditions like this would be a good first step.

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By David E. Williams of the Health Business Group.

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David Williams: This is David E. Williams from the Health Business Group. I’m speaking today with Steve Bonner, CEO of Cancer Treatment Centers of America.

Steve, thanks for joining me today.

Steve Bonner: You’re very welcome, David. It’s great to speak with you again.

David Williams: What is Cancer Treatment Centers of America and how does it differ from other well-known cancer centers?

Steve Bonner: Cancer Treatment Centers of America is a growing chain of hospitals that specialize in and treat only cancer. We tend to see later-stage, more complex patients, because they get the diagnosis and stay at home until it becomes more complex. At that point they then, go looking.

We have as comprehensive and complete an array of technology and talent for traditional cancer therapy under one roof as you can find anywhere. What really sets us apart is our commitment to a holistic and an integrated style of care. The traditional therapy treats the tumor but cancer is not the tumor, it’s the malfunction of the basic immune system. Therefore we provide a very robust array of complementary therapies, which include nutrition plans, naturopathic intervention, mind and body medicine, spiritual support, exercise, Reiki, yoga, Pilates and pain management, which includes acupuncture as well as more traditional methods of pain management.

We integrate these therapies for every patient in a way that you  don’t see elsewhere. If you go to the finest cancer providers, you’ll be able to see a great medical oncologist and a cancer-trained nutritionist and naturopath. However, those professionals will never talk to each other. We structure a team of those professionals around each patient and that team stays with that patient throughout  the course of their treatment at  CTCA.

David Williams: I’m curious about how you think about the definition of quality in patient care because  a more holistic and integrated approach, is more difficult to measure.

Steve Bonner: Exactly. Our corporate DNA is grounded in the philosophy of patient-centric care. Of course, everybody says that, but we were created by an international merchant banker and a libertarian whose mother got cancer. Our founder set out to create something that structurally keeps us focused on the patient. As a result, when it comes to quality, the question we keep asking is, for each patient, what is the patient’s definition of quality and how are we doing in achieving that?

We have our own extensive measures of the quality of the experience. We measure and publish data from the patient point of view, using a Bain Net Promoter Score and also do the conventional Press Ganey Measurement. – We also include HCAHPS, Leapfrog and many others.

We believe that as an industry, we have a long way to go to really understand quality from the patient’s point of view. When we talk about HCAHPS and Leapfrog, they’re useful, but they’re more for the industry’s point of view than the patient’s point of view.

We have two major initiatives that are underway to try to help us better understand quality measures and then provide information about quality that we think can lead to some breakthroughs. One is a new piece of research that we’ve just released called the “The Cancer Experience”. It is a national study of patients and caregivers. The Cancer Experience is composed of a thousand cancer patients, a thousand caregivers, and family members of cancer patients all of whom are people who have been treated in centers across the country. This isn’t specific to CTCA patients although our patients are included.

The headline of this study that was surprising to us is that one in four of these patients and caregivers are dissatisfied with the care that they’ve received across the US. We note that 20 percent of these patients have left the place they went first for care and have gone somewhere else as they try to find the quality of care and the price of care that matches their expectations.

The survey goes on to point out that there are three major events or elements of care that really drive the dissatisfaction. The first is that patients know how complex the disease is, know how complex the treatment is going to be, and know how  challenging it’s going to be to understand it.  They expect and want us to provide them with a care quarterback the minute they come into the hospital that can stay with them throughout their care. A person that understands their disease understands what we can do and can help them navigate the system.

The second issue is that patients want an integrated care team to make sure that they get care for this disease that addresses the mind, body, and spirit, not just the tumor. The survey told us that 86 percent of the patients and caregivers wanted an integrated team, but fewer than 70 percent actually were able to have one.

The third major driver of this dissatisfaction is pain management.   It is easy to imagine how important that is to a patient and to a caregiver.  It was interesting that the caregiver actually felt more strongly about pain management than the patients did. Half the population in the survey said they did not get the pain management that they needed and wanted to allow them to be able to navigate their treatment and get to the best possible outcome.

The other major activity that we’re involved with is to try to help the industry and help us understand quality from a patient’s point of view.  In response to this we’ve created a partnership with the National Patient Advocate Foundation, which is not-for-profit. We’re underwriting a piece of research that will be presented a year from now, next April. It is another survey of cancer patients and family members that will allow them to define the cancer value index in their terms.

It’s basically  trying to create the JD Power of oncology, where the association of research will conduct this research, they’ll publish the research and then, they’ll continue to manage it in a way that will allow providers to give them our performance information. They can then publish it in a way that will make it much more comparable for patients and allow them to more intelligently navigate the industry as they seek a combination of quality, price and as a result, value.

David Williams: I’d like to ask you more about the role of competition in terms of improving quality. You mentioned that your founder comes from a libertarian background and merchant banking. And of course you’re a for profit organization. In lots of places in the economy, competition drives quality, performance and value but not necessarily in health care. What role does competition play in driving quality in health care, both in oncology and more broadly?

Steve Bonner: Competition is one of the most powerful drivers of quality, cost and value that is available to us. An empowered consumer with choice will walk, talk and teach us what real value is. If we then compete based on those terms, we’re going to see quality naturally go up and price naturally come down.  Even in health care today — LASIK or elective plastic surgery — where it’s up to the patient to decide and pay you see continued improvement in the quality and in the technology. And you can see the price continuing to come down.

The way we’ve constrained competition in health care is a major factor in how expensive care has become and how elusive true quality is. That’s part of the reason we’re sponsoring these two significant efforts to engage the consumer to teach us how they want to define quality.

David Williams: In most markets, including ones you’ve described, there’s usually a market price for something, and the supplier sets their prices and customers either pay it or they don’t. Health care is also a little different where you have commercially-insured patients and you have Medicare and Medicaid patients. Medicare,  in particular, will tend to pay a lot less than what the commercial patients are paying.

In an area like oncology, what impact does that have on providers and on patients? What are the policy implications of this often wide disparity between the commercial reimbursement rates and what government programs are paying?

Steve Bonner: The implications are profound. I may back up a step and say that if we want competition to control the market, then we have to enable that competition with much better information, including information about price.

David Williams: Let me ask you about the recent Reuters Special Report that I’m sure you’ve seen. It was taking a look at your company’s claims that survival rates are higher for your patients than for other patients. It concluded that those claims couldn’t really be substantiated because there were differences in your patient population versus those you were comparing it with. Can you just provide some commentary on how you look at this issue more broadly and address some specific questions that came up in that Reuters Report?

Steve Bonner: We heard that these reporters were working on a story and we reached out to them and invited them to include us in the dialogue, which ultimately they did at some level. We invited them to come and visit our hospitals and talk to our patients and  understand the patient experience, which was part of what they were writing about. We explained to them what we’ve done with the publication of our outcomes and the rationale behind it and the evolution of it going forward.

We did tell them that all the data that we published on our website on outcomes is vetted by an independent research team at Washington University and offered them the opportunity to talk to the research team. They declined to come and  look at it. In my opinion, they wound up drawing unsustainable conclusions and making observations that simply aren’t supportable as they presented them.

We’re either the first or the second or the third in oncology to put any outcomes data on our website — but we publish all the outcomes on analytic patients who come to CTCA. These are patients who had not been treated elsewhere. We publish that by length of life, quality of life, match to location and stage of disease. It’s very clear that’s what is published.

The other way to come at it is what we don’t publish. We don’t publish data on the patients who have been treated elsewhere before they come. The question is why, and the reason is because we haven’t so far figured out a good frame of reference to offer people. With analytics of the disease, we have the SEER and NCI database and that’s what we use as a point of reference.  We think it’s fairly comparable to this segment of our patient population.

Where we have a fourth-stage pancreatic cancer patient who also has diabetes and a heart condition and has been treated in some very unique way in two or three organizations, to just publish their length of life data, we don’t think would be helpful to patients. We haven’t published that. We’re in the process of relooking at that and maybe we just need to put that out there and then, we’ll take on the questions as they come.

Some of the organizations that the reporter quoted in criticizing our methodology are organizations that so far had not published one statistic with respect to their own outcomes. They don’t publish HCAHPS data. They don’t publish Press Ganey data. We ask ourselves how valid and relevant and reliable are these as critics?

We do have a unique population and that’s a fair observation. We talked about the major elements of it. They are very engaged patients. Most are patients who have been diagnosed and treated elsewhere, they’re not happy, and they’re willing to travel. Our average patient travels 250 to 300 miles to come to us for care. These are people that really are in the game and are going to do what they need to do to find a cure.

They tend to be a more advanced stage population than  others. The article suggested that we culled out from inquiring patients those who were more advanced with their disease and that’s absolutely unsupportable.  We see many patients who had been told by MD Anderson, Sloan-Kettering, Cleveland Clinic that there’s nothing more than can be done for them at those institutions and to go home and get their affairs in order. We take those people in. We can introduce them  to patients who have heard that same thing from those institutions and others three years ago, five years ago, ten years ago.

We’re here for that kind of patient and do everything we can to bring them in. Every patient has to navigate their insurance structure, and that’s what culls out patients, not CTCA.  When the patients want to come to us, we’ll work very hard with their insurance company and with their employer to try to make sure everybody understands the situation. We look at what other options might be available for the patient and try to open doors that might otherwise be closed.

We see some insurance companies and some employers being much more flexible with these patients who clearly have no options elsewhere.  If a patient’s in an HMO and they’re not willing to let them opt out of the HMO into some sort of a PPO coverage, there’s really not going to be a way for them to come to CTCA. That’s the insurance market operating, not us culling patients.

David Williams: As you look at the next three or five years,  do you see any expansion opportunities? Is it putting facilities in different geographies from where you’ve been? Is it offering new kind of services? Where do you see the company heading over the medium term?

Steve Bonner: The future of health care is a really an exciting future to behold, and especially in oncology. For CTCA, we are looking at trying to make ourselves more conveniently accessible to patients. In the last seven years, we’ve gone from one center to five centers and we’re looking at a sixth center. We’re looking at the possibility of some less intensive centers that  we can put many more of them around the country and offer cancer information, central diagnostics and routine treatment. The therapeutic future may be even more exciting than that to us.  We think that the next major breakthrough in oncology is clear and that’s going to be understanding the disease at a genomic level and then being able to match known therapies much more precisely with the genomic abnormalities that a person’s expressing.

We’re working very hard on genomic innovation. Today, when you get cancer, a tumor shows up in one part of your body, insurance company providers go to an FDA-approved drop-down menu that says “if you have that cancer in that body location, this is the treatment that’s performed best in large population, placebo-controlled double-blinded studies”, and so you should get that. Every insurance company will pay for it and if you stay in network they’ll get it for you at a 40 percent discount.

The reality is that those large population studies produce the best tumor response in maybe 40 percent of the population. We’re prepared to pay for 100 percent of the population to get the therapy even though we know statistically only 40 percent are going to respond well.  As we dig underneath that, we find that your pancreatic cancer and my liver cancer may actually be driven by the same genomic abnormality, but our systems express tumors different., You’re going to get one therapy and I’m going to get another therapy. If we understood it genomically, we’d both get the same therapy and avoid a lot of unnecessary therapy that we deliver through the system today.  This is one way to take significant cost out of oncology care and really accelerate and enhance the quality and effectiveness of care. That’s the most exciting thing we see in the future.

David Williams: I’ve been speaking today with Steve Bonner. He is CEO of Cancer Treatment Centers of America. Steve, thanks so much for your time.

Steve Bonner: Thank you, David. Take care.

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So Christie has built up a reserve of credibility with me and I suspect others. Therefore I take him at his word that his recent gastric banding surgery for weight loss was undertaken primarily for the sake of his family rather than to bolster his chance to become President. The press coverage is helpful because it helps educate others about the surgery and the lifestyle steps that are still required afterwards in order to make it a success.

With obesity so common it’s helpful to have a role model who is doing something decisive about his own personal issue. I wish him success and good health.

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“Cuts in Medicare payment rates have not caused the rapid rise in private rates. In fact, private rates might have grown even more rapidly if Medicare had not kept its rates in check.

The Affordable Care Act permanently slowed the growth in Medicare hospital payment rates, producing large savings for the federal government. One criticism of those rate cuts is that private insurers will get stuck with the tab. My results indicate the opposite: Private insurers may actually see the growth in their payment rates slow as a result of the act…”

The author, Chapin White, of the Center for Studying Health System Change isn’t definitive in his conclusion about the mechanism by which these results are occurring, but has a theory:

“Intuitively, when Medicare cuts its payment rates, Medicare patients become relatively less financially attractive, and private patients become relatively more financially attractive. Hospitals then seek to increase private volume, and the way to do that is by lowering the private payment rate.”

I think he may be right. Another simple explanation is that health plans tend to follow Medicare rates and do little to independently establish and negotiate price levels. As mentioned yesterday I’d like to see the Affordable Care Act modified to give health plans greater incentives to control costs; hospital rate negotiations would be a prime way to do it.

On a related note, constrained health care spending is helping bring down the budget deficit from crisis levels. The Washington Post and others say this is a bad thing because it reduces pressure for a “grand bargain” on the federal budget. But I don’t see a grand bargain happening anyway (despite the sequester, which was supposed to be more than sufficient motivation), so anything that defers the need for a budget deal is fine with me. If we’re lucky things will continue to improve and we won’t need the Congress to come to its senses.

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In the spirit of improving the law, I’d like to see a modification to the minimum medical loss ratio rules for health plans. Under the law, plans have to spend at least 80 percent (individual and small group) or 85 percent (large group) of premiums on medical costs. On the positive side this ensures that health plans use their resources on medical care and reduces incentives to restrict access, but it also limits the incentives for health plans to contain costs. After all, if medical costs are contained “too much” then the plan has to pay a rebate.

But we really should want plans to contain costs: by negotiating hard with providers, by introducing better network designs, and improving payment methodologies. Plans should be rewarded financially for doing this.

One way to make it happen would be to let plans with a strong track record of cost containment escape the MLR, at least partially. For example, if a plan raised its premiums by less than the market rate or less than some external benchmark such as the Consumer Price Index, it could be allowed to have a lower MLR –and higher profit margin. That would encourage plans to do a better job of holding the line on costs because it would be the surest route to enhanced profitability.

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Many of the caregivers are performing advanced tasks such as those described above, but few report getting appropriate (or any) training to do these jobs. In my experience the equipment can be complex and it’s extremely easy to make a mistake. (See my recent, related post about managing a complex pediatric regimen at home.)

It’s unlikely that a great influx of trained, affordable nurses will be arriving anytime soon, but there are a couple paths that hold promise:

• Hands-on training for caregivers, integrated into doctor visits, with follow-up available by phone and videoconference using Skype and similar readily available technologies
• Intuitive, consumer oriented equipment and supplies, akin to what Apple has done in the consumer electronics sector. You see it to some extent already in self blood glucose monitoring for diabetes, but there’s a lot further to go. FDA should encourage better consumer usability in its approval process

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Now I’m not saying the FDA is necessarily wrong to have a look at this topic. In particular chewing gum may be a concern because of the way the caffeine is absorbed and the potential to ingest a lot of pieces. It just shouldn’t come as a surprise that companies would invent these products.

The gum has about 40 mg of caffeine per stick. That’s about half of what a cup of coffee has (although there’s lot of variation) and similar to a can of coke. It’s less than what’s in Mountain Dew. There have been foods on the market for a long time with that much caffeine. Take coffee ice cream, for example. Some varieties have more than 80 mg per cup, and I don’t think the FDA is going to keep kids away from it.

Food and beverage makers aren’t that clever, and you can count on them to try a variety of ways to entice snackers beyond the standard sugar and salt. Just so the FDA doesn’t get surprised next time around, here’s my recipe for a new concoction:

• Lollipop containing caffeine, nicotine, alcohol and marijuana

You may scoff, and yet nicotine pops have been tried in the past, alcohol and caffeine have been mixed in drinks, and marijuana legalization is proceeding at least in some states.

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Error types include administering at the wrong dose or frequency, incorrect label, missed doses, using expired medication, and using the wrong administration technique. Many of the errors have the potential for harm, some caused actual harm.

From the article:

“In our study, parent administration errors were often caused by miscommunication between parents and clinicians or between in-home caregivers regarding changes in oral chemotherapy dose. Frequent changes in dose, which caused the bottle label to be outdated, were often a root cause of parent errors.”

I’ve seen similar things happen outside of oncology. Sometimes a patient is taking 10 or more medications and supplements, so it’s very hard for a parent to remember what to do even when they are well educated, organized, and have the best of intentions.

I’d like to see someone come up with a comprehensive solution to managing multiple, frequently changing pediatric medications in the home setting. I don’t have a specific solution in mind, but would be very appreciative if one came on the market.

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By David E. Williams of the Health Business Group.

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What challenges are you trying to address?

As a technology company, we look for ways to close existing gaps or delays by streamlining the healthcare payment and billing process and connecting its various components. The current payment system is convoluted, confusing and wasteful. We need to rethink it from the ground up if we’re serious about doing the very best for healthcare consumers. We hope to bring an increased understanding of the process and simplification for the patients and providers, as well as empowerment for consumers.  Data shows patient satisfaction with their provider decreases 10 percent from the time of discharge to after receipt of the bill. We’d like to see that turn around—where the payment process is another opportunity to affirm the strength of that provider’s brand and mission

What is the Super EoB and why was it developed?

The Super EOB was developed after one of HPS’ founders, James Brindley, underwent treatment for cancer and saw the bills begin to mount.  After a full recovery, Jim gathered his stack of paperwork, met with his neighbor who was in the healthcare field and said, “There’s got to be a better way to make sense of all of this.” After two years of research and planning, they incorporated Health Payment Systems. Sometimes patients need to simply focus on getting well, and the overwhelming medical bills and EOBs do not help.

The Super EOB benefits three entities:

• Providers receive a single electronic payment from HPS for both the benefit plan and patient portions of a bill
• Employers save money because HPS passes along savings it secures from providers
• Families receive one monthly statement, the Super EOB, which includes healthcare services from all HPS providers, for all family members.

It’s really a win-win-win for all involved.

What kind of feedback are you getting from patients?

We know that patients can easily understand what they owe, where to submit payment and by what due date. A process like this saves time, trees and money, plus patients understand it better and don’t have as many questions for employers.

In a recent focus group, we asked employees of a local county government what they thought about the advances in claims technology and the ability to receive something like a Super EOB. Participants liked that information for all family members was on the same page, and that they could make one payment for everything on the statement

Who are your customers? What is your business model?

Our customers range from small employers to large, self-funded companies.  We have a large portion of municipalities and school districts, as well as healthcare providers. As a healthcare technology company, our business model is aimed at taking waste out of the claims administration process, while making the healthcare payment experience easier for consumers to understand. Our provider network includes more than 6,500 healthcare practitioners in Wisconsin. We enroll more than 75,000 patient members and have 40 employees.

What impact is ACA implementation having?

The ACA was created to provide affordable healthcare to everyone. In order to do so, steps need to be taken to make healthcare more affordable.  Removing waste from the payment of health care services is our primary business, and is one factor that will help make healthcare more affordable.  There is no better time for employers to embrace the single payment technology offered by HPS.

Why did you develop the YouTube video? What do people think of it?

To tell our story better, we put together a short, animated YouTube video that demonstrates just how much paper the average family receives related to healthcare billing.

It’s a fun, easy-to-understand explanation of the current state of healthcare paperwork from the patient’s perspective. HPS actually has a stack of EOBs and bills that we counted to get to the numbers mentioned in the video. We have some pretty fascinating data that I’m not sure anyone else on the claims or provider side has researched before.

The response to the video has been positive.  It has helped HPS tell our story, as well as allowed our employees to share with their family and friends to help them understand what they do at work.

What’s next?  How else are you hoping to improve patient experience?

We have been out starting the conversation—meeting with providers and employers to see what their changing needs are and how we can help address them.  We need to shift our idea of competition in order to work together toward better value for patients and communities. That said, we would love to partner with a local provider about launching a Payment Value Stream. It would allow us to examine each step in the current process to see where we can remove waste and create value. From a lean perspective, this is an area of care not many people have looked at, and we think it’ll give us great insights. We continue to work at incorporating the voice of the customer and transparent performance data into our approach.  Finally, we are working on a consolidated billing product, will soon be rolling out a more robust patient portal and are looking at additional ways to empower consumers.

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Bio: Jay Fulkerson joined Health Payment Systems (HPS) in 2011 and serves as the president and CEO of HPS. Previous to his role at HPS, Fulkerson served as chief executive officer of Touchpoint Health Plan in northeast Wisconsin. Following the acquisition of Touchpoint by United Healthcare, he served as chief executive officer for Wisconsin and then as regional chief executive officer for United Healthcare’s Midwest Region.

Interview conducted by David E. Williams of the Health Business Group.

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In this podcast interview, Joe Marabito, CEO of ikaSystems lays out the complexities of the health plan IT world, describes how health reform is providing new opportunities for administrative innovation, and speculates about the role Accountable Care Organizations will play in transforming the payer world.

ika provides a variety of next-generation IT infrastructure to health plans and so has a front row view of the changes.

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By David E. Williams of the Health Business Group.

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Those closer to the action know better. In particular:

• Many costly treatments aren’t worth the money
• New treatments with tiny or no benefits often cost a multiple of existing therapies
• Despite their reputation for penny-pinching, health plans are often not aggressive in negotiating price
• Patients are already suffering mightily from high costs –and it impacts quality of life and survival as well as financial health
• Society as a whole can not afford to pay the high prices charged for so many of the new therapies

So it’s encouraging to see a perspective in the journal Blood endorsed by more than 100 experts. The piece, The Price of Drugs for Chronic Myeloid Leukemia (CML); A Reflection of the Unsustainable Prices of Cancer Drugs: From the Perspective of a Large Group of CML Experts,  is very useful because it comes from people who know what they’re talking about and who have traditionally been sympathetic to drug makers and unperturbed about costs.

Here are some excerpts that are noteworthy for their candor and clarity:

“If drug price reflects value, then it should be proportional to the benefit to patients in objective measures, such as survival prolongation, degree of  tumor shrinkage, or improved quality of life. For many tumors, drug prices do not reflect these endpoints, since most anti-cancer drugs provide minor survival benefits, if at all.”

…

“In the US, prices represent the extreme end of high prices, a reflection of a “free market economy” and the notion that “one cannot put a price on a human life”, as well as a failure of government and insurers to more actively negotiate pricing for anti-cancer and other pharmaceuticals, in contrast to practices in other parts of the world.”

…

“In Europe and many developed countries, universal health coverage shields patients from the direct economic anxieties of illness. Not so in the United States (US) where patients may pay an average of 20% of drug prices out-of-pocket(about $20-30,000 per year, a quarter to a third of an average household budget), and where medical illnesses and drug prices are the single most frequent cause of personal bankruptcies. High drug prices may be the single most common reason for poor compliance and drug discontinuation, and the reason behind different treatment recommendations in different countries.”

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By David E. Williams of the Health Business Group.

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The article presents no real ideas on what to do about the problem. If anything the article implies that it would be better to make oxycontin more widely available in order to stem the use of heroin. That’s a nonsensical approach as far as I’m concerned.

There are alternative approaches that might be more promising.

One idea is to establish better guidelines on the prescribing of painkillers after surgery. Many patients –maybe you’ve been one of them– receive an overly generous supply of oxycontin or vicodin after a minor surgical or dental procedure. Sometimes the patient gets addicted from that initial supply, other times the extras end up in the family medicine cabinet where teens might find them and try them out. It’s not always obvious how to dispose of these medications, which contributes to them hanging around.

One hurdle to overcome is that follow-up visits are inconvenient and also not very profitable for doctors. Perhaps if there were quality measures associated with good practices that would change the equation and tighten the initial supply.

Another issue relates to so-called “drug seekers.” We’ve all heard about drug seeking patients who come to the emergency room to get drugs. There are IT systems coming online that can at least identify such drug seekers and alert doctors, but this only works if the systems are consulted, which may not happen when middle-class patients are involved. It’s easy to label patients as “drug seekers,” which makes them sound like bad people. Some are. But many others are patients who are somewhere down the path toward dependency. They’re not trying to become oxycontin addicts and certainly aren’t looking to move to heroin. Rather than turning people away it would be better to have a path to refer these patients into treatment and then to track their progress.

There are great opportunities for physicians, payers, employers, consumers and pain management experts to work together to develop a more comprehensive view of the problem, to develop a strategy to address it, create new quality and safety measures related to achieving the strategy, and align incentives so that physicians are rewarded for doing the right thing.

We won’t solve the problem of painkiller abuse in one shot. But it’s reasonable to start by tightening up on the relatively easy places, such as cutting down on the distribution of unneeded post-surgical pain meds and figuring out how to better direct “drug seekers.”

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Express Scripts breaks waste into 3 categories:

• ~$60B wasted on high priced meds when cheaper equivalents, (e.g., generics) were available.
• ~$95B from not using “the most cost-effective and clinically appropriate pharmacies, including home delivery and specialty.” This is further broken into savings from lower drug costs (~$35B ) and savings from higher adherence through those channels (~$60B)
• ~$270B from avoidable pharmacy and medical expenses from low adherence, independent of the waste included in the second bullet point

All three bullet points are self-serving, especially the second one, since it describes the line of business that is most profitable for Express Scripts. (On a side note, I’ve noticed that PBMs have replaced the term “mail order” with the friendlier sounding “home delivery.”)

Nonetheless these numbers are probably supportable and directionally correct.

There’s another big category, too, which is drugs that should not have been prescribed in the first place. I don’t know how big that category is but I bet it rivals point number 3 in magnitude. Express Scripts benefits financially from the perpetuation of that kind of waste, however, which could explain why it’s not included in the study.

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• Do more to communicate risks of medicine misuse and abuse
• Safeguard medicines at home
• Properly dispose of unused medicines
• Avoid modeling bad behavior by misusing or abusing drugs

The report raises quite a few interesting points, but some of the survey results raise more questions than they answer, and there are other issues not addressed.

Prescription drug abuse is a serious problem. One area the report focuses on is the abuse of stimulants such as Adderall. Here’s their take:

“In fact, almost one-third of parents (29 percent) say they believe ADHD medication can improve a teen’s academic or testing performance, even if the teen does not have ADHD, and one in four teens (26 percent) believes prescription drugs can be used as a study aid.”

And regarding prescription drugs in general:

“Parents and teens share the same misconceptions regarding prescription drug misuse and abuse. One in six parents (16 percent) believes that using prescription drugs to get high is safer than using street drugs, and more than one in four teens (27 percent) shares the same belief.”

While the survey is surprised at how high these numbers are, I’m surprised they are so low. And some of what the surveyors characterize as misconceptions I regard as accurate or at the very least open to debate. For example:

• All else being equal, why wouldn’t it be safer to get high from prescription drugs than street drugs? The ingredients and dosing are known, the purity is bound to be higher, there’s less physical risk of obtaining the product (if from parents’ medicine cabinet especially), almost no risk of arrest, and if something goes wrong the emergency department can have an easier time figuring out what you took. Can it really be that only 1 in 6 parents and 1 in 4 teens agrees with me on this?
• It’s interesting that only about 1 in 4 parents and teens think ADHD drugs can improve academic testing and performance. I’ll bet there’s more support from college students who are big users of these substances. And do we really know that these meds aren’t effective in “normal” people, especially when cramming for a test? Part of the issue here could be that plenty of kids with ADHD or who are just a bit restless are put on drugs and get used to having them
• Direct to consumer ads tell us to “ask your doctor if [Drug X] is right for you.” And when we do ask, many physicians say yes. This includes pain drugs. In fact I saw a DTC ad for the pain drug Lyrica today. Given that, is it such a stretch that some people could think it’s ok to take pain meds without a prescription? And instead of emphasizing that 20-25 percent of teens who are unworried about pain drugs, perhaps the report should have emphasized the 75 to 80 percent who do think there’s an issue.

I really do think prescription drug abuse and misuse is a serious problem. But the problem is not just naiveté on the part of parents and teens. It gets to the fact that unlike a generation ago, we are starting to use Rx drugs as performance enhancers, and the use of consumer advertising to promote prescription medications has predictably created a much stronger consumer mindset about the use of these substances.

—–

By David E. Williams of the Health Business Group.

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Anyone heard about this?

“Has Genenetch looked into the practice of retinal specialists multi-dosing Lucentis, i.e., administering up to 4 doses, from a single use vial? Some providers argue that, since each vial contains 5 doses, they can do this by drawing out the doses into multiple injection needles (other the one injection needle that Genetech supplies in the package). It seems that there is a danger here for microbial infection, and also some concern about the provider lowering there actual costs of purchase by adminstering multiple doses from a single use vial. Comments?”

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Why is medical device connectivity important, and what benefits does it bring to the patient?

Rapidly becoming a priority for many hospitals, biomedical device connectivity to the hospital network—or medical device integration (MDI)– enables medical devices to transfer patient data from the point-of-care over the network into an electronic medical record (EMR) system or other charting systems. Device integration delivers patient data to clinicians in near real time so that information supporting patient care decisions is delivered timely and accurately.  Without MDI, patient data, particularly vital signs, is transcribed on paper charts and the recording is duplicated by manually having to key the data into the patient’s electronic record. MDI helps assure data accuracy by eliminating manual transcription errors while relieving caregivers from burdensome manual tasks, enabling more quality time with patients.  The bottom line is increased patient safety and care.

Why is it important to automate the collection of patient data (i.e. vital signs) and how does this improve the quality of data entering the EMR?

End-to-end automation of patient data collection ensures accuracy and precision.  Full automation removes potential error points along the way as device information is sent to the EMR or other systems.  For example, as I mentioned before that many caregivers read data from a device, manually record it and then input it into the electronic system.  From an administrative standpoint, the need for absolute accuracy of data is greater than ever before.  In addition, having data in electronic format is essential to ensure the full realization of a complete electronic record, which enables data exchange with other hospital IT systems and access to this information hospital-wide. Again, from a regulatory and reimbursement standpoint, the importance of this electronic format is increasing as Meaningful Use (MU) guidelines become more defined.

What happens to patient data as it moves throughout the hospital? How is that data being used?

As patient data is collected through electronic means, it is aggregated from software or hardware, analyzed by the connectivity software, and translated into a format appropriate for the hospital IT system receiving the information.  Various hospital departments—whether the ED, OR, ICU or med-surg–may output device data in disparate formats, often completely proprietary formats.  That data then must be translated into a standard format for the EMR and perhaps reinterpreted once again for compatibility with specialized departmental IT systems.  As each new department inputs information, the data is normalized as required and translated for the needs of specific hospital IT systems.  In that way, device information can follow the patient through the hospital, wherever it is needed.

What are some of the differences across care units in the hospital? How does that impact the technology being used?

Workflow varies greatly among various care units—the ED, OR, med-surg and step-down, for example, and also varies by hospital.  Med-surg units often have many beds with a limited number of devices shared among them on mobile carts.  Intensive Care, by contrast, may rely on a greater number of devices, which are fixed in location and associated with a particular bed. A quality MDI system seeks to reduce the complexity of its technology by supporting the existing workflow already in place in a particular setting.  Capsule has different hardware and software solutions to support various settings and workflow requirements. Some are wall-mounted units that accept fixed-position devices and are already associated with a specific bed for continuous data collection. Another solution would be a mobile device interface for equipment with no fixed location, which must be associated with the individual patient for periodic data collection.  Data must be validated, and in some settings, a nurse requires flexibility about the timeframe care patients may require immediate attention before caregivers have time to accept data.

—-

Interview conducted by David E. Williams of the Health Business Group.

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The email said:

“Greetings from Angie’s List. Below is a list of your recent searches. Do you have any questions or need further assistance? If so, just reply to this email and we’ll be happy to help you out.”

The message then listed a gastroenterologist and primary care practice I had searched on April 1.

It then went on, “If you have finished your project(s) please submit a review or send us some feedback on your experience(s) by replying to this email.”

I applaud the follow up and like the idea of soliciting reviews, but I had to chuckle at the word “project.” While I’d love to be finished with my gastroenterology ”project,” somehow I’d don’t see that happening anytime soon!

Maybe I’m being a bit unfair, but I think Angie’s computer should be smart enough to pick out the medical topics, especially since that’s all I’m signed up for.

——

P.S. –The Angie’s List team read this blog post and told me they are changing the wording.

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An author described work at a hospital to reduce surgical complications. According to the New York Times, “the team was stunned to realize that lowering the complication rates would actually cost the hospital money.”

Stunned?

In a fee-for-service model, hospitals get paid for what they do, not what outcomes are achieved. So if something goes wrong in surgery the hospital usually gets to bill for the ICU, another surgery, extra days in the hospital, etc. Unless those services are unprofitable then of course the hospital will make more money from cases where those resources are used.

If a factory screws up its production process, it has to spend more money to rework the product, but it can’t sell the final goods for more money. If it messes up badly the work in process may need to be scrapped and the product can’t be sold at all. But a hospital can often charge for its rework (avoidable complications) and the scrap (deaths caused by errors).

I described the situation last year in Reducing surgical complications: How to make it happen faster.

By David E. Williams of the Health Business Group.

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In this podcast interview, Simplee co-founder and CEO Tomer Shoval explains how his company’s medical wallet and self-service payment platform help patients understand and pay their bills and help providers collect payments faster and at a lower cost.  Shoval has a background in e-commerce (he’s ex-eBay) and that experience shows through in Simplee’s approach.

By David E. Williams of the Health Business Group.

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Enjoy!

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As Kaiser Health News reports, only 2 percent of Massachusetts residents lack coverage compared with 16 percent nationally. Costs per person are the highest in the country, just as they were before Massachusetts implemented universal coverage in 2006.

There’s plenty of reason to be optimistic on costs, however:

• Health plans are offering innovative payment models that reward quality and cost containment. As a result premiums for commercial coverage have flattened. My business actually experienced a slight decrease in premiums from Blue Cross this year for the first time ever (after more than 10 years in business)
• Providers are focused on cost restraint. Academic providers like Partners and Beth Israel have become more cost conscious while new community-based providers such as Steward Health Care are arising to fill the need for affordable, quality care
• State government is playing a reasonably constructive role by encouraging pricing transparency and targeting a cap for the industry’s growth rate without making it too dramatic or ironclad
• Quality and cost data are being supplied by organizations such as Massachusetts Health Quality Partners and Castlight Health through distribution partners including Harvard Pilgrim and Consumer Reports

On the one hand, the Massachusetts example should be encouraging to other states that are about to experience Massachusetts-like rules on universal coverage, minimum medical loss ratios, and disallowance of medical underwriting. It shows that it’s possible to achieve these standards and then start to take on costs.

But Massachusetts had already made strides toward health care reform before 2006 and had a relatively low rate of uninsured. The state’s knowledge based economy is also better able than others’ to afford the costs of health care reform. Employers can much more easily afford to pay for health insurance for high skill, high wage workers than for those with low skills and low wages. Massachusetts has a long-standing culture and tax base that supports education, which is a key driver of a high-wage economy.

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David E. Williams:  This is David Williams from the Health Business Group.  I’m speaking today with John Driscoll, president of Castlight Health.  John, nice to speak with you today.

John Driscoll:  Great to be with you, David.

Williams:  John, we’re going to talk about two topics today.  One is the new Castlight Pharmacy product and another is Castlight’s emergence in my home market of Massachusetts with its first health plan deal with Harvard Pilgrim.

Let’s talk about pharmacy first.  What is this Castlight pharmacy product?  What is the need that you’re addressing?

Driscoll:  As you know, David, we are absolutely aggressive about making sure that consumers have real time information that allows them to make the best choice.  And we are focused on the lack of cost and quality information in marketplace.  That’s an entirely new area for consumers and patients.

The one area where consumers are ready and able to make smart purchasing decisions is pharmacy.  So we thought it was important to invest in a new capability to allow consumers to make decisions right after they’ve left the doctor’s office with their mobile device or when they’re searching on the Internet.

Consumers are very focused on how much drugs cost.  And many patients are trading off drug costs against their weekly budget.  So we thought it was important to invest in this capability and roll it out quickly because we knew that patients and consumers needed it now.

Williams:  Pharmacy, as you said, is an area that consumers are really ready and able to engage in it.  It seems like that’s partly because it’s a discrete product that they identify as opposed to going to a hospital and not knowing what set of services they’re receiving.  But it also is maybe because it’s an area where there’s been some focus both from health plans and from PBMs.  I know you spent some time in that industry.  So can you distinguish what Castlight is doing from what’ already out there?

Driscoll:  It’s clear in other categories where we are providing cost information for the first time to patients.  But even in the pharmacy world, even with all the information and tools that health plans provide, they’re not focused on providing real time information at the point of decision in a way that impacts consumers immediately.

That’s probably a function of the fact that at Castlight we have a major focus on consumer behavior. Frankly, this is all we do.  We provide the best tools with the best information. So much of how you get a consumer engaged and keep them engaged is providing simple consumer-oriented tools that are as sophisticated as a consumer needs.

It could be as simple as making sure they know the difference between branded and generics and home delivery versus a local pharmacy.  Those basic choices –and providing them in a way that consumers can act on– extends the value of their benefit at the point where they are given a script.

Those tools really don’t exist in the marketplace in a way that really engage the consumer.  There’s an art to putting together the consumer interface and the product and then making sure that we’ve got real time information that is directly relevant to where the people are in their benefit.

Williams:  Unlike with medical benefits, there seems to be a fair amount of competition at the retail level on drug prices. So you have Wal-mart, which kicked things off with the $4 generic program and you see it extended into some pharmacies that offering low priced Lipitor or free antibiotics.  Can that information be integrated into Castlight pharmacy or does that stand outside of the system?

Driscoll:  What we are focused on is what’s covered under the insured benefit. Any part of the benefit that employers are paying for is integrated into the tool.  And it’s integrated in a simple way to enable the consumer to make a decision at the point of shopping.

Williams:  Is there a connection between what you offer on Castlight Pharmacy and the medical part of the benefit or are they standalone tools that are used separately?

Driscoll:  They’re really standalone tools, but the great thing about pharmacy is the richness of the data and the fact that the consumers are ready to comparison shop. What’s hard is integrating in a simple way that enables the consumer with limited time to make a decision.  And that’s really what this component of the product is.  It sits on top of the traditional Castlight transparency product.

Williams:  Does Castlight Pharmacy serve the Medicare Part D market or is this more for commercially insured patients?

Driscoll:  Today, our pharmacy product is focused exclusively on the commercially insured, but we absolutely are going to be looking at Medicare and Medicaid, because there are opportunities for consumers to save in every market.

Williams:  My understanding is that with Castlight, a consumer would need to have their employer be a customer of Castlight in order to access the tools.  Is that the case with the pharmacy product as well or is it available to individual consumers?

Driscoll:  Yes.  The employer has to buy it. It’s through the employer purchasing that enables us to gain access to information that powers the tool and allows the employee to understand exactly how much is covered and exactly how much things cost.

Williams:  Let me turn to another topic: health plans. I think about Castlight as somewhat of a competitor or threat to health plans. You may be revealing information to their customers that they perhaps should have revealed themselves.  And yet it seems you’re starting to work with health plans, beginning with Harvard Pilgrim, which is often ranked as the number one health plan in the U.S.

Can you talk about what you’re thinking with health plans and then what specifically is going on with Harvard Pilgrim?

Driscoll:  First of all, I would say that health reform is a team sport. We look at all of the health plans that work with us as partners. We’re all driving better outcomes and lower prices; the vast majority of people in the health insurance industry want to do that.  We feel like we’re all playing for the same cause.

We will partner with health plans in small ways or large to deliver value for their covered lives.  And we’re very excited to be able to adapt the cost estimator, our technology and our approach and to work with such a great partner as Harvard.

We look at the health plan marketplace as a real opportunity for Castlight.  In some cases, we’ll be working with employers. In other cases, we’ll be working directly for the health plan and with employers in that marketplace.

For us, it’s just a variation on what we think is a huge need in the market place – for better information and an empowered consumer.  As it happens, there’s a complete values match between what Harvard wants to achieve in the market place and what we’d like to achieve in the market place.  They are very focused on transparency and may want to empower their approach to have Harvard Pilgrim.

Williams: John, it’s interesting to see that you signed your first health plan in Massachusetts, which is a market that has led the way with health reform. The Affordable Care Act was modeled on the Massachusetts plan.  We’ve also been quite active in transparency.  Did the legislation and the move in the policy sector toward transparency have anything to do with why Massachusetts is the first market you’re entering with health plans?

Driscoll:  There is no question that the health plans in Massachusetts are particularly progressive. And obviously, Harvard Pilgrim is one of the best and the highest-ranked plans in the country.  I think it is no surprise that we are finding great partners in the most progressive markets in the country.  What’s interesting about the Massachusetts marketplace is its employers, its legislators, as well as health plan leadership that are driving a much more transparent system.  And I think where you’ll see transparency not just on cost but also on quality and outcomes.  It’s also a place where there’s a lot of very interesting and enlightened thinking around how to compensate for value and how to measure value.  It’s really a laboratory for the rest of the country in health reform innovation.

Williams:  Yes, it’s interesting.  We also had one of the earlier all-payer claims databases in Massachusetts.  My impression is there’s been a lot of information put into that database. The plans have submitted that information, but not all that much has come out of it.  Does Castlight complement the all-payer claims database?  Is it a substitute for it?

Driscoll:  I think it complements the all-payer database.  There’s still a fair amount of data gaps in every public database that’s been put up, but every time another database is developed and is improved, it’s another step towards having a more transparent system. That means a fairer system, a more accurate system and a system where not just software companies are selling services, but the patients and doctors and health plans and everyone else will gain from having a system where you can measure and then drive better results.

Ultimately, Castlight is more interested in getting access to information that historically folks haven’t had access to, making it actionable for employers and employees in a way that helps them drive better outcomes and lower costs.  And as of today, we need to be able to get more information and provide it in a particularly elegant way and constantly improve it. The bigger Castlight gets, the more we know about the consumers and we can create tools that have meaningful impacts on cost and quality.

Williams:  You talked about health reform being a team sport. Clearly Castlight and health plans and employers are on the team.  Are providers part of that team as well and if so, how do they play?

Driscoll:  They are.  We’re only in the first few innings of transparency for employers and employees, but I’m not even sure it’s the first inning of transparency for providers.  The majority of providers want to do the right thing but don’t have actionable information.  They don’t have tools they can use.  They don’t have tools that are meaningful, that fit their workflow and that can furnish providers with better information on cost and quality.

One of the concerns I have about some of the more progressive markets like Massachusetts is making sure that providers have access to that same information that Castlight currently provides to employers. Without that, to compensate doctors and hospitals on performance metrics seems unfair.  We will only have a fair system that can function and create better performance if providers have access to the same kinds of information that Castlight is currently providing to employees.

Williams:  Obviously, physicians are under a lot of pressure.  They’re being asked to do things that they weren’t asked to do in the past and didn’t learn about in medical school. They’ve got a lot of requirements to adopt health information technology, a lot of compliance requirements, and an imperative to do more with less.  And as I look at a lot of information systems that are out there, the providers really don’t have such great access to the kind of transparency data that you’re describing.

What’s the solution there?  And how long does it take?  And are there ways to see milestones along the way that may indicate longer term success?

Driscoll: Providers are only going to use tools that are meaningful.  They want to save money for their covered lives and the patients they serve and they want to create better outcomes.  But they don’t have information right now and certainly nothing’s been built into workflow. I think the next step is working, these companies life task is working with health plans to provide their network participants better information and to make certain that it is meaningful, simple and doesn’t slow down the hard work that doctors are doing.

The promise of companies like us or the promise of technology is to create this frictionless change where people can actually do more with less hassle. If you can integrate software tools into physician and hospital practices with the kind of information that the health plans have, doctors will make wiser choices.  There’s a real opportunity right now but I’m concerned that without those kinds of tools, that putting doctors on new kinds of performance metrics like bundling, or bonusing them more on value is unfair unless they have the information to make wise choices.

Williams:  I’m a member of a health plan in Massachusetts, a different one than the one you described, and my primary care physician is part of a contract that does pay based on value. I’m wondering what kind of information would it be useful for her to have that she probably doesn’t now that could help me and could help her?

Driscoll:  I don’t know what information your doctor has access to, but certainly every doctor needs to have better feedback for the covered member that they’re taking care of, what’s covered and what’s not.  For the doctors they refer to, what are their historic outcomes, how frequently have they done certain procedures, how satisfied are patient, and how do they fit into an episode of care? In a fee-for-service world there are informal referral networks.  We want to create a system leveraging information that creates an informed referral.

Williams:  I’ve been talking today with John Driscoll, President of Castlight Health.  We’ve been talking about the new Castlight Pharmacy product and also talking about Castlight’s first health plan customer, Harvard Pilgrim, in Massachusetts.

John, thanks so much for your time.

Driscoll:  Thank you.

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• What the new pharmacy tool adds to the offerings already on the market from health plans and PBMs
• Why the first health plan customer is in a market (Massachusetts) that’s already a leader in transparency
• The role of health care providers in the transparency movement

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In recent years more powerful hand dryers have been popping up and now fewer bathrooms offer paper towels.

Of the new dryers, my personal favorite is the Dyson airblade. It’s powerful, quiet and has a clever design.

But I’m not so fond of the Excel Xlerator. Sure it’s powerful, but it’s also incredibly noisy. I have sensitive ears, and I’m not embarrassed to admit that when I’m exposed to a loud sound I cover my ears with my hands. But of course if I’m drying my hands I can’t use them to protect from the noise.

The Xlerator is loud enough that I suspect it’s a threat to hearing. At the very least it’s so annoying that I bet some people skip hand washing to avoid using it. My gym has one of these beasts and after being bothered by it for a while I decided to research the noise level.

I found a paper on the subject by Jeffrey Fullerton and Gladys Unger from the acoustical consulting firm Acentech. Sure enough, the Xlerator is a real noisemaker. Apparently the company has also developed a noise reduction nozzle, but I don’t think I’ve ever seen one in operation.

I followed up with the authors, who told me that OSHA does not find the level of noise generated by the Xlerator to be a danger to hearing. It’s not loud enough to cause immediate hearing loss and since it’s used for only about 15 seconds at a time it’s not likely to cause permanent damage.

They did advise me to put my hands a foot or so below the nozzle rather than a couple of inches, because hands in the airstream is a major factor in the noise level. 

So today I gave it a shot. If anyone was watching me they probably wondered why I was stooping down to use the dryer. But it actually worked. By keeping my hands lower the noise level was cut to an acceptable level. It took a little longer to dry my hands, but it wasn’t bad.

By David E. Williams of the Health Business Group 

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I asked Cohen –a senior research fellow at the Tufts Center for the Study of Drug Development– to comment on some of the findings.

Why did you base your research on patient access rather than market availability?

I’ve been studying patient access for over 10 years. I try to distinguish between key dimensions of patient access. Broadly, patient access is a function of: i. market availability (off-label uses are an exception to the rule); ii. coverage by payers; iii. patient out-of-pocket costs. Market availability captures one element of access. It is a necessary, but insufficient condition of access given that the vast majority of cancer drugs are paid for by third party payers.

From the patient standpoint, what are the advantages and disadvantages of the US v. European approaches?

The biggest advantage in the U.S. versus Europe with respect to cancer drugs is faster market availability of a greater number of drugs. Two rather stunning facts stood out: 1. None of the common subset of 29 drugs were approved in Europe before the U.S. And in most instances the lag was at least 4 months. 2. At the same time, for drugs licensed by the EMA and approved for reimbursement by the national health authorities there were hardly any out-of-pocket costs for patients in Europe. Contrast this with co-insurance percentages of as high as 40% for some drugs in the US. There are medications with annual price tags of over $20,000 –and 40 percent of  $20,000 is a lot of money to shell out, especially for those on fixed incomes.

The comparative outcomes information you cite in the article is very old and excludes drugs approved since 2002. Why is this the case? Is there any way to look at more recent information?

The articles themselves are not old. They are recent publications (2009, 2010, 2011). However, if one looks carefully at the time period during which survival data were being measured it becomes clear that the newer vintage drugs were not included in the studies. Hence, one cannot conclude that better survival statistics for a number of cancers in the U.S. are due to better access to newer cancer drugs. Until we have data showing survival that can indeed be attributed to better access to newer drugs, we are left to speculate. My hunch is that better access in the U.S. to newer cancer drugs (i.e., faster and greater numbers of approvals, as well as fewer coverage restrictions) has been beneficial to some patients, as has improved screening and earlier diagnostic work-up.

In the timeframe you considered, 41 oncology drugs were introduced in the US but only 31 in Europe. Are there clinically significant products that make it to market in the US but not elsewhere? Can you provide an example?

Provenge (sipuleucel-T) comes to mind as a drug with a lot of fanfare in the U.S. It was approved in 2010 by the FDA, yet still not approved in Europe. At the same time, it should be said that there are certain differences in regulatory mechanisms that have benefited market uptake of a number of drugs in Europe, including Iressa (gefinitib). Iressa has led practically a moribund existence in the U.S., while in Europe, as a result of EMA approved of a companion diagnostic in 2009 – an EGFR mutation test kit – sales have increased steadily.

—–

By David E. Williams of the Health Business Group 

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Health plans are making adjustments. Not surprisingly they are looking at ways to cut administrative costs, just as the law intends. One easy target is commissions for agents and brokers, and those commissions are in fact being cut. From LifeHealthPro:

“The (MLR) requirements contained in the Patient Protection and Affordable Care Act continue to have a devastating financial impact on the country’s approximately half-million licensed professional health insurance agents and brokers, as well as on all of their employees and their millions of employer and individual clients,” stated Janet Trautwein, CEO of The National Association of Health Underwriters (NAHU).

Trautwein explained that the MLR requirements significantly and negatively impact access to health insurance agents and brokers at the very time our economy is the weakest and health care consumers need the most help.

She noted that the Congressional Budget Office (CBO) reported that agents and brokers often serve as de facto human resources departments for many small firms — negotiating premiums, processing claims and enrolling employees.

Brokers are pushing to have the MLR rules exclude agent compensation and they’ve picked up some allies in the Senate.

I totally understand why agents are unhappy and why NAHU is pushing for this change, but I don’t believe a change is justified. The current compensation structure has brokers working on behalf of the health plans to sell coverage. If agents and brokers are really working as HR departments for small firms –as Trautwein contends– then those firms would be better off paying for such services directly rather than paying a health plan to pay a broker to do the work.

The easiest short term path for the broker community will be to keep pushing to change the legislation. But in the long term it will be healthier for all if employers rather than health plans pay for brokers’ consultative and HR services.

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David E. Williams:  This is David Williams, president of the Health Business Group and author of the Health Business Blog.  I’m speaking today with Nina Nashif, CEO and founder of Healthbox.  Nina, thanks for joining me today.

Nina Nashif: Thanks for having me.

Williams:  What is Healthbox and what unmet need was Healthbox created to serve?

Nashif:  Healthbox was founded in January of last year and was intended initially to support health care entrepreneurs by providing seed capital, mentorship, a rigorous process to help them think about their business and how they grow it, as well as support in raising money at the end of a four-month program.

As we’ve evolved our program Healthbox has also shifted its own business model. We believe that it’s not only important to support health care entrepreneurs, but it’s also important to serve as a catalyst of change within the health care industry by exposing hospitals, payers and pharma and other types of organizations to new and different ways of thinking about how to solve the industry’s greatest challenges.

Williams:  Is the process that you’re using generic?  Could it be applied within other industries or is there something different about innovation in health care that makes it so that you’ve chosen a particular approach?

Nashif:  It’s really important that we develop a process that’s relevant in the health care industry.  So as we thought about creating the Healthbox platform we thought about the different nuances involved in building a company in health care.  As we know, the health care system is complex.  There is often a difference between who’s buying the product or the solution and who’s actually using it.  There are so many different stakeholders and different revenue models that make sense depending on the type of organization you’re selling into.

Given all of the dynamics it’s important to work with a company throughout the lifecycle and to think about how are they building their business in the context of the industry that they’re selling into.  We’ve refined the process that helps entrepreneurs think about these critical issues and develop a customized product and a business that will scale in the industry.

Williams:  You’re based in three cities. If somebody would ask me to guess what those three cities were just based on the description of your business, I would have guessed Boston, New York and San Francisco.  But you’re in Chicago, Boston and London.

So tell me how you thought about those three places and also how you incorporate what’s going on in London to what’s happening in the U.S., considering that the US and UK health care markets and health care systems are so different.

Nashif:  I’m actually based in Chicago and so is Sandbox Industries, which is the organization that I was working for when I founded Healthbox.  Our first program was based in Chicago for that reason and it actually ended up being a great place to start Healthbox, because despite what people may think Chicago does have a very vibrant health care community. There’s the strength of many large hospitals, many associations, and there’s pharma present. Many different dimensions of the health care system do exist.

Our first program was in Chicago.  As a result of the success there we were asked by Blue Cross Blue Shield of Massachusetts to consider bringing this program to Boston and the rationale for doing that was their interest in engaging in the broader community.  There’s a lot of activity in Boston and a lot of strengths in the health care industry.  But a lot of the activity from an entrepreneurial perspective is really revolving around the universities. TechStars has a strong program here in Boston, the MassChallenge and all the resources that you know that exist in the community.

But from a health care perspective, there wasn’t really a single external platform that was tying together all the unique organizations that are interested in innovation in Boston.  So we were pleased that our second program launched in Boston just because all of the existing activity that’s going on and we’ve been really well received and very happy to be testing the model in a new environment and to be working across the region.

London was a strategic decision and our presence there probably happened a bit quicker than we initially expected. I lived and worked in London before and so making the transition there was quite easy for us, relatively speaking.  But health care is global and we always knew that we wanted to be a global platform. So as a stepping stone to the rest of Europe, London and the UK just made sense for us.

Williams:  How does the Healthbox program work?

Nashif:  The Healthbox program initially was modeled after the spirit of a traditional tech accelerator program.  We took a lot of the same components in terms of the seed capital that’s provided, although we knew that starting a company in health care requires more resources, not because IT companies and health care aren’t capital-efficient businesses, but because the sales cycle takes longer and requires just a little bit more business development time.

We provide $50,000 in exchange for 7% equity.  We have a national network of mentors that represent different parts of the health care industry that are available to provide strategic advice, make introductions to their network and other potential customers or experts that can help the entrepreneurs.

We also have a pretty rigorous curriculum or process that we put the companies through.  From the very beginning we’re actually going back to my original comment about helping these entrepreneurs understand their business model, refine their business model, think about it in the context of the health care industry. We help them think about who is the buyer, who’s the user, what kind of revenue model would make sense given what they’re trying to develop.

We have a proprietary process that we’ve developed and we put companies through the three –and now expanding to four– month process.  At the end we help match entrepreneurs to investors and help them think about the right customers as well as investors that can help them grow their businesses in the long-term.

So those four are the main components that make up the Healthbox program.

Williams: I know that Healthbox is pretty new and you just alluded to the long sale cycles that are inherent in a lot of health care businesses.  But with that in mind, can you provide any examples of success stories or organizations that have been launched or accelerated as result of going through the program?

Nashif:  Sure.  There is a company called SwipeSense that went through our Chicago program. Given that they’re a year out, they’re a really good example because they’ve moved themselves through the product fund-raising and business development cycle in the last year.

They focus on what they call hand-hygiene 2.0.  The lack of hand sanitization in hospital environments is a big driver of hospital acquired infections.  It results in more than 100,000 deaths per year and adds billion of dollars worth of costs to the broader health care system.

There are two amazing entrepreneurs who are graduates of Northwestern University’s design school. While they were in school came up with a small device that clips on to a nurse’s scrubs.  The company is called SwipeSense because as a child we always think that if our hands get dirty we’re going to wipe our hands in a downward motion on our pants in order to get whatever’s on our hands off. This mimics that gesture in terms of a nurse who needs to sanitize his or her hands would swipe their hand down this device that will be clipped on to their scrubs.

They came in to the Healthbox program with a prototype of this product already developed, and throughout the process of going through Healthbox and talking to a number of different experts they were challenged on what business they are really in. They evolved their business to become a software as well as a hardware business and went through a process of getting feedback in the market from focus groups of nurses in different hospital settings.

By the end of the program they were able to secure a couple of new pilot sites.  So as they came in to the program with two pilots, they left with six and now as a result of coming out of the program and continuing to network, they have ten pilots that are ready to begin.

Also, as a result of going through some of the focus groups and their initial pilot, they ended up redesigning or streamlining the device that they’ve created because the feedback that they got was that it just needed to be a bit smaller, needed to clip on in a different way.

They also built out their web application and have continued to gain customer traction, and they also raised more than a million dollars at a pretty strong valuation.  So they have accomplished more than they had on their own as a result of coming through Healthbox.

Williams:  You’ve mentioned before that you had evolved to change the Healthbox business model.  Can you talk a little bit about that evolution and what your current business model is?

Nashif:  Given that Healthbox makes investments in companies, we’re set up as a venture fund.  We are a for-profit model, unlike some of the other accelerators in the industry.  As I mentioned before we’re making a $50,000 investment in exchange for 7% of the equity in these companies.

We also have funds available at the end of each program that are used to make follow-on investments in the form of a convertible note.  But Healthbox makes money as a result of the companies being successful.  We’re incentivized to help these companies grow in the long-term and become sustainable and scalable businesses.

We have an upside in terms of when these companies potentially exit and that’s really how we’re compensated in the long run.

Williams:  If you look back in a few years from now, how will you know if Healthbox has succeeded beyond the dollars and cents?  Are there other measures that you might look at to say this has really been what you were hoping it would be?

Nashif: As I mentioned before, I think that the traditional accelerator measures their success based on the number of financings immediately after a company leaves the program.  The typical metrics are on how many companies have raised X amount of dollars, how many companies have added jobs. There is an economic development aspect of this.

There’s also the metric around how many companies are even in business one year to two years or three years later, given that we know that across any industry there’s just a certain percentage of companies that don’t make it.  And so I think for us all of those metrics are really important, but as I mentioned before we’re also trying to be an agent of change in the industry.

We measure our more immediate success also around how many companies get pilots and how many users they are attracting and whether they are actually able to gain attraction in the industry, because if they’re not doing that then the financing is going to be harder to get. Because I think venture investors are traditionally even more risk averse.  They tend to like to see the customer attraction and validation of the market before they’ll invest and so I think those are some early metrics for us.

We certainly value the relationships we have with investors and with the broader entrepreneurial community.  But for us to really effect change and be successful at supporting our portfolio we need strong relationships in the industry, at all levels of the industry, and we need to gain broader attraction with opening up the industry.  I call it “unlocking the knowledge” and unlocking the industry to entrepreneurs so that they can be successful.

We also need to work on the other end of the value chain. So what I would want to say five years from now is that we built a great portfolio of companies.  We’ve had one or two exits that we feel proud of and we have really strong relationships across the ecosystem.

Williams:  I’ve been speaking today with Nina Nashif.  She is CEO and founder of Healthbox.  Nina, thank you so much for your time.

Nashif:  Thank you for having me.

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Texas Gov. Rick Perry (R) doubled down Monday in his opposition to expanding Medicaid under President Obama’s healthcare law, even though opposing it could cost his state $90 billion.

At a press conference where he was flanked by other conservatives, Perry argued expanding the health insurance program for the poor would make Texas “hostage” to the federal government.

“It would benefit no one in our state to see their taxes skyrocket and our economy crushed as our budget crumbled under the weight of oppressive Medicaid costs,” Perry said at the state capitol.

The last paragraph in particular is a head scratcher. The federal government will be paying 100% of the cost of the expansion over the first few years of the program and then downshifting slightly to around 90%. This is a much better deal for the states than the base Medicaid program, which Texas continues to participate in. Perry’s argument seems to be premised on the idea that the feds won’t live up to their promises  –in particular that the 90% federal share in the out years somehow won’t come true or that even if it does the extra 10% will play havoc with taxes and the Texas economy. Even if we give Perry the benefit of the doubt on this point, why not take the 100% for now and then throw all the extra beneficiaries off the rolls later? The idea that accepting the Medicaid expansion will be crushing financially is laughable.

In addition to Texas losing out on the $90 billion or so of federal funds mentioned in the article, Texas employers may face federal “shared responsibility payments” in the range of $300 to $450 million per year as a result of Perry’s obstinance. According to Jackson Hewitt Tax Service, employers are generally not penalized if their employees are on Medicaid. But if Texas rejects the Medicaid expansion, some employees who would have qualified for Medicaid will end up enrolling in the premium assistance tax credits provided by the ACA instead. And in that case their employers will be subject to substantial penalties.

Those shared responsibility payments will flow from Texas to the federal government, and the federal government will also spend billions less on Medicaid expansion in Texas. That’s good news for taxpayers in states that are accepting the Medicaid expansion, but I don’t see how it helps the people of Texas, whom Governor Perry is supposed to represent.

MCOL has a good infographic showing the impact of this provision on various states, including Texas.

You’ve heard the expression “Don’t Mess with Texas” –which originated as an anti-littering campaign– but in this case Texas it messing with itself.

By David E. Williams of the Health Business Group.

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I’ll let others speculate on the causes of these disparities in birth rates. But I will say that having a low teen birth rate is a blessing for Massachusetts and indirectly allows the state to afford universal health care. Instead of having babies and often ending their formal education, women in Massachusetts are staying in school longer and ending up with higher levels of educational attainment. Boys/men also have a greater opportunity to stay in school when they are not burdened with paying for a child’s upbringing.

A population with more education attracts employers who pay higher wages. And these higher wages enable employers to offer health insurance and state governments to raise tax revenue that can be spent on education, health care and public health. It’s a virtuous circle.

Massachusetts, New Hampshire, Vermont and Connecticut are also in the top 10 states in terms of percentage of residents with health insurance. Of the states with a high birth rate, they all rate 36th or lower.

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By David E. Williams of the Health Business Group.

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First I tried searching HealthGrades, Yelp, Angie’s List and Massachusetts Health Quality Partners (MHQP) for information on something I really care about. I typed in the name of a medical specialist at a local academic medical center who is caring for a family member with a serious illness. This doctor has been in practice for 20 years but only one site I looked at (HealthGrades) had any reviews, and those two were not detailed. I then looked for other specialists and found that there are typically very few reviews available. It’s unusual to find more than five reviews for a given specialist on any one site, although I’m sure there are some exceptions. MHQP doesn’t include specialists.

Next I turned to primary care. The information is better –MHQP in particular stands out on data quality– but there is still a lot to be desired. I searched for my physician, Dr. Johanna Klein of the Beth Israel Deaconess Medical Center’s Washington Square Group. Here’s what I found:

Healthgrades — a listing with a lot of publicly available information (address, phone, insurance, date of graduation) plus seven patient experience surveys showing that people generally like her

Angie’s List — which I paid $11 to join– has a confusing search function. I found Dr. Klein but no reviews for her. There were 16 reviews for the broader medical group, though, enough to get a general idea of the practice and some specific doctors within it. One of the reviews is harsh “I seriously question if she has actual medical training…” but most are pretty sober, boring and don’t sway me one way or the other. This site was the most disappointing overall and I don’t recommend subscribing.

Yelp –is the liveliest of the sites, at least in its reviews of this practice, and also incorporates some of the most innovative social media features. There are 7 reviews, 3 of which give 5 stars, 3 with 1 star and 1 with 2 stars. In addition to the rating most have a significant amount of text –quite a bit more than Angie’s List. Reviews are sorted by “Yelp Sort” as a default and can also be sorted by date, rating, Elites (a Yelp designation for evangelists) and Facebook friends. The Yelp sort takes into account various factors –like user votes and recency– to list the most helpful reviews first. Each reviewer has her or her first name, last initial, town and photo displayed, along with the number of Yelp friends, number of reviews posted and how many times they have “checked in” at the location. Clicking on the reviewer’s name provides a profile of the person, ratings of the usefulness of the person’s reviews, and a distribution of the person’s ratings. The distribution of ratings is interesting because it gets to a key concern physicians have about ratings: are they just posted by people with negative experiences?

The Yelp sort did an excellent job of ranking the ratings. The first review is by a person with multiple chronic illnesses who’s seen a specific doctor at the practice for 10 years and gave 5 stars. She had many specific things to report about her doctor and clearly had plenty of basis for her comments. Four people had rated the review helpful, and it showed that she had checked in twice on Yelp while at the practice (compared to none for the others).

The next two reviewers gave low ratings: 2 stars and 1 star. These reviewers have written more than 150 reviews each –awarding 4 or 5 stars in the vast majority of cases– so this is a helpful credibility builder for me.

The last 2 reviews –1 star each– are written by people with no Yelp friends and only a few reviews. The negative ratings are based on specific anecdotes and even though one has six “useful” votes it is still at the bottom, where I think it deserves to be.

Overall the reviews rung true to me based on my own experience.

MHQP is much more scientifically rigorous than the rest of the sites, and its data forms the basis for Consumer Reports’ recent report on physician quality in Massachusetts. Data on clinical quality comes from health plan data and patient experience is derived from a statewide survey. In patient experience there are 90 responses for the Washington Square Group. Results are also displayed as one to four stars, but here the stars have a statistical basis: e.g., 4 stars means an office did better than 85 percent of others in the survey, 1 star means it did worse than 85 percent of the offices. MHQP also enables a side-by-side comparison of different offices, which is a nifty feature.

Despite the harshness of some of the Yelp reviews of my practice the picture painted by the MHQP results are –if anything– worse. There are quite a few categories with 1 star (e.g., How well doctors give preventive care and advice) and few with 4. And yet 71 percent of the Washington Square Group’s respondents say they would “definitely” recommend their doctor and 19 percent say “probably.” Because of its statistical rigor the MHQP site is bereft of qualitative comments that could shed light on the findings, and results are reported at the level of the group rather than for individual physicians. And of course MHQP is only available in Massachusetts, although certain other states and regions have similar resources.

I looked at these websites when I picked my primary care physician. They didn’t have much influence on me then and wouldn’t today. In the end the number one issue was finding a specific physician I liked –and as mentioned there is essentially nothing documented on my doctor. Instead I relied on my previous doctor’s recommendation after eliminating a few other potential choices. Location was also important and I wanted someone within the Beth Israel system because I like the hospital and my records are on the PatientSite portal. I do have some concerns about the overall customer service of the practice and some of the low MHQP ratings, but figure if I watch out for myself that these things won’t affect me.

In an ideal world the rigor of MHQP ratings would be extended to the individual physician level –at least for certain measures– and to medical and surgical specialists. Physicians or practice manager would also have a way to reply to the ratings and reviews at least in a general way. If some of the Yelp approach could be applied to add texture to the data through user commentary then we’d really have something.

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By David E. Williams of the Health Business Group.

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I’m planning to resume blogging on the old platform later today. Readers shouldn’t see any impact for now.

Thanks for your patience.

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The blog started out on Blogger more than eight years ago and moved to a WordPress in 2006. We’ll be sticking with WordPress but shifting from a self-hosted site to WordPress.com for more extensive support and enhanced security.

This will be the last post this week. The plan is to be up and running again on Monday, but there could be a few glitches while we make the move. RSS feeds and email subscriptions should keep working. I’m keeping my fingers crossed.

Thanks for your patience!

If you notice any problems please use the contact form at the Health Business Group website. Meanwhile I will continue to be active on Twitter @HealthBizBlog.

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But as 2014 draws closer the green eyeshade types are speaking up, and the message is more reassuring. ObamaCare actually won’t cost each Wendy’s restaurant $25,000 per year as previously estimated. The new estimate is down 80 percent to $5,000 annually. The average Wendy’s has revenues of $1.4 million, so we’re talking here about less than 0.4 percent of sales.

According to the Wall Street Journal (Restaurant Chains Cut Estimates for Health-Law Costs), other restaurant chains have been making similar pronouncements:

They say many employees will decline company-offered insurance, either because they can get insurance through Medicaid or a family member, or because they prefer to pay the penalty for not having health insurance. The penalty next year will be as low as $95 next year, much less than most employees will be asked to pay through company-sponsored insurance plans.

As long as restaurants and other employers offer plans that meet ACA’s requirements they won’t be penalized for lack of employee uptake.

The new estimates are good news for the restaurant industry, and demonstrate again that ObamaCare is actually a moderate law, not a sweeping takeover of the health care economy. It’s not so great, though for those workers who will still be without coverage. Penalties go up gradually over time, which may increase worker participation somewhat. In any case it will give some time for kinks in the law to work out and for the provider and payer community to absorb the new entrants into the system.

Once the dust settles we’ll see where we are and maybe there will be a need for further tweaking. In any case there should be a significant increase in the number of people with coverage and no threat to the chains’ ability to offer bargain menus.

Of course ACA is about a lot more than forcing restaurant owners to offer insurance. The cost and quality improvement elements are important, too, and with time and good will there is the potential to realize significant overall changes for the better in the health care system. Putting health care on a sustainable path will be good for the restaurant industry and others, and 10 years from now we are likely to look back on 2014 as no big deal.

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I’m mainly on Dr. Murray’s side. I believe that over treatment is a big problem and that hospice care is underutilized. I understand the concept of never wanting to be put on life support. I am angered and saddened that the nonsensical “death panel” argument was used as a cudgel against ObamaCare by invoking the prospect of rationing of care.

And yet I’m uncomfortable with the article. First, to what extent should we accept the author’s anecdotes as evidence of the general state of physician perspectives? I don’t see a lot of systematic evidence for his contentions. Second, even if doctors feel that way should patients necessarily ratchet down their demands for services? I would say no.

My concern as a patient, caregiver or family member is about being written off when it’s not warranted. For example (since anecdotes seem ok, here) doctors discouraged a family member from chemo for leukemia due to his age, even though as I discovered the advice wasn’t really evidence based. He had chemo anyway thanks to our insistence, tolerated it well, and lived an extra year. It’s hard to figure out what tradeoff is reasonable to make between suffering and the potential to extend life even when all the information is in hand, which it rarely is.

And while it’s easy to oppose heroic, frequently futile measures and suffering in general, when it gets down to specific situations I’m not nearly as comfortable. Who’s to say a patient shouldn’t be willing to suffer in order to live a while longer and have a few more weeks or months with their grandkids?

The general point of the article –that those with the most knowledge of the limits and possibilities of medicine seek less of it than the general public in certain circumstances– is certainly worth contemplating. But I haven’t changed my own views after reading the piece.

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The study advises physicians to ask about what else patients are taking or doing, which is probably a good idea. But I’d like to see more attention paid to how physicians react when they hear about other therapies and the extent to which they are willing or able to engage with the large percentage of patients that seek relief or cure outside the medical setting at the same time they are working with their doctors.

Some of these therapies are herbs or other substances that may interact with prescribed drugs. Doctors definitely need to know about that and deal with it. Other approaches, such as massage, meditation and reflexology may be helpful for some patients –and it may or may not matter if the physician is involved.

The best physicians take a personalized, holistic approach to their patients, and do so in ways that do not conflict with the evidence based mantra.  One physician I know has a medicine man (who’s also his patient) perform a ceremony blessing the statin he prescribes to another member of the same tribe. I’m willing to bet his patients are more adherent as a result of this approach.

I’m not a major proponent of alternative and complementary medicine, but I do find it revealing to see how physicians relate to other approaches, especially for diseases they can’t cure. Do they insist that other approaches are invalid and consider them an affront? Do they balance a healthy skepticism with open mindedness to the idea that they don’t know everything? Do they vary their approach depending on the individual patients and their situations?

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We discussed how the health care industry can use information technology to make health care more affordable, convenient and accessible. Fasano believes health IT can help completely transform the relationship between patients and providers.

Fasano looks forward to an era where a patient’s medical record is available wherever he or she seeks care, where empowered consumers use mobile devices to access customized, personalized information that they can understand and use.

Fasano was encouraged at HIMSS to see a greater emphasis on connectivity than in the past.

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Interviewed conducted by David E. Williams of the Health Business Group.

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Researchers at the University of Massachusetts-Amherst are touting success in the case of a robot that delivered speech and physical therapy to a 72-year-old male stroke patient.

“It’s clear from our study … that a personal humanoid robot can help people recover by delivering therapy such as word-retrieval games and arm movement tasks in an enjoyable and engaging way,” speech language pathologist and study leader Yu-kyong Choe said in an announcement.

While the child-sized robot might not be the ideal therapist, it could help ease the shortage of workers, especially in rural areas. 

“A personal robot could save billions of dollars in elder care while letting people stay in their own homes and communities,” the authors wrote in a study published in the journal Aphasiology.

To me it’s a no brainer to use robots for rehab. Take the phrase “arm movement” tasks. Robots can be much better than human therapists at doing boring, repetitive arm movement tasks over long periods of time. And of course if the robot can be the patient’s home it makes access all the easier.

In 10 years we’ll look back at these early results and it will be totally obvious the direction things were moving.

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Reading a little further into the piece I see they are mainly looking for secret information about novel drugs and devices, but business processes are also on the list.

By David E. Williams of the Health Business Group.

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David Williams:  This is David E. Williams from the Health Business Group.  I’m speaking today with J.P. Fingado, President and CEO of API Healthcare.  We are at HIMSS in New Orleans.

What problem does API address?

J.P. Fingado: We’re trying to solve several problems.  The first is around quality of care, so we seek to put the right people at the right place at the right time to achieve the best possible outcome for the patient.

The second piece is helping hospitals control their cost and optimize the use of labor.  So if we actually optimize across everybody in the hospital, across all their facilities through the continuum of care, we’re saving the hospitals millions of dollars through the deployment of their staff on an annual basis.

There’s a third piece that’s also very important, which is improving that satisfaction of their entire workforce. Allowing them to have more control over their schedules, over their interaction with their human resource system leads to happier employees, which in return, increases productivity.

Williams:  Here at HIMSS there’s certainly a lot of discussion about electronic health records and health information exchange. Meanwhile you have a couple of things that sound like variants on those.  You’ve got not an EHR but an EER and not a health information exchange but a healthcare workforce information exchange.  Can you describe what those concepts are and how they fit in to the goals that you’re trying to achieve?

Fingado: The electronic employee record is a single repository of everything about every single health worker in an institution.  We’re actually tracking before they even come on board.  We’ll start the data collection at the recruiting phase to understanding the competencies and the scenarios and the environments that workers have been in prior to joining an organization.

Once they come then we’re tracking all their growth inside of an organization.  We’re tracking where they work inside of a hospital, the time that’s being tracked, all their HR information, all their training, all their performance reviews.  We ultimately go to full succession planning.

Putting these millions of data points into a single record allows the hospital to effectively deploy those people and put the best people on the field at any point in time.

The other piece that we brought to market from an innovation standpoint is the healthcare workforce information exchange. We take all these records –imagine in a hospital two or three thousand people and the millions of data points– and we optimize that across the continuum of care and share the information across every facility inside of a hospital.

We’ve got a hospital customer, for example, Advocate Health Care, which over 200 locations in their network with tens of thousands of people that we help them optimize.

Williams:  Interestingly, you seem to be combining clinical information about patients in the hospital with this EER concept. If a client is using your system, how much of a difference can it make for the patients that are in the hospital?  Is it just a minor or incremental improvement or do you see something that’s more dramatic. And if so, how could you measure that?

Fingado: So scheduling a nurse is not like scheduling a waitress.  You can not just give every nurse three patients and call it a day.  There’s a huge benefit when you can match up the needs of the patient to the expertise of the nurse.  So think about it. If you are in the ICU and there was one nurse that had treated 50 patients with the exact ailment and another nurse that treated one, which nurse do you want?

It’s pretty obvious.  So when you start to do that you really drive higher quality across the board, a better outcome for the patient. Now you’re talking about huge results for the organization.  With reform, reimbursements are going to get tied to quality.  Poor quality will drop reimbursements.

So now we’re not only saving the money on the expense side, we’re actually increasing the revenue of the organization, now making it a healthier environment, which in turn helps patients as well.

Williams:  You’ve been describing the tracking of nurses and others from the time they are hired into the organization and maybe even beforehand. But a lot of these health care organizations are a little more complex than that. A lot of them use agencies or other sorts of outside resources.  So how do you address that situation where you have many personnel that are not actually employees of the hospital?

Fingado:  That’s a unique thing that we do that nobody else in the industry does. We don’t think in terms of employees.  When you look at a hospital you’ve got the full-time employees and part-time employees, but you have volunteers, you have contractors and you have contingent workers.

When we put in the system we’re putting in the system for all the health care workers in an institution.  If somebody calls in sick a nurse manager or a manager of any department can look at all the available resources in their department, they could look in the float pools, they could across the entire organization.

But with our systems they can also look at any contingent staffing companies that are in their preferred network and it will show them just the resources that fit the need based on licenses, competencies, performance ratings, as well as cost.  And for the first time, a manager can make an instantaneous decision about picking the right resource, not just their full-time employees but anybody that can provide the highest level of care to the patient.

Williams:  I want to ask a broader policy question that relates to what you’re doing. We hear about the shortage of nurses and in particular about baby boomer nurses that are going to retire, but at the same time we also hear that nurses graduating from nursing school are actually having a hard time getting started in the profession.

So you could see a situation where you’ve got a lot of inexperienced nurses who don’t get experience and then a lot of nurses that eventually retire. You also have some people who will come in and out of the workforce. It all seems very dysfunctional. Does what you’re doing contribute to getting nurses into the funnel and helping them to get experience?

Help me understand this combination of a nursing shortage overall coupled with the difficulty a new nurse has getting hired.

Fingado:  A very astute observation.  So that’s actually a big reason why we’re seeing a lot of demand for the systems. Hospitals are bringing a lot of the nurses in who don’t have a lot of experience and what they can do as part of the system is match those nurses with the experienced nurses, put them in scenarios where they can really learn and get up to speed quicker, and then over time starting to move them to more independent roles where they’re learning and training on different types of patients going forward.

It’s a huge issue and one reason why hospital administrations are starting to make a big technology investment in workforce management. They recognize that there’s going to be a big shift in the workforce over the next decade.

Williams: I’ve been speaking today with J.P. Fingado, President and CEO of API Healthcare.  We’re at HIMSS in New Orleans.  J.P., thank you very much for your time.

Fingado:  David, thank you and I hope you have a great rest of the show.

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She wonders aloud why we couldn’t have that kind of campaign here and answers that problems include access to primary care, the perception that going to the ED would be quick, and that primary care referred them to the ED.

These factors are all legitimate, but there’s more to the story. Emergency departments can be profitable and are a major feeder for inpatient admissions, so hospitals advertise them. You don’t have that in the UK. That advertising also leads to the perception that the hospital is a better place to be seen, so even patients who could get access to their primary care physician don’t try.

My health plan (Blue Cross) and others have what are euphemistically referred to as “demand management” services. In my case I can call and speak with a nurse who can steer me in the right direction, whether toward self-care, the emergency department, primary care, a specialist or the pharmacist. I’m not sure these things really save the health plans any money, but I also don’t know whether the UK ads work.

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There’s a lot of truth in the article. As I have written recently, fees sometimes rise when hospitals buy physician practices and tack on facility fees. And in my prediction for 2013 published by InformationWeek I predicted that physicians will struggle to stay independent.

But although I mainly agree with Gottlieb’s observations, I’m more optimistic than he is, and less eager to point the finger at ObamaCare. In particular:

• The trend toward hospital employment has been going on for a long while now, as Gottlieb acknowledges. One could say ObamaCare encourages this trend but from my perspective the bigger factors are the desire to join with a bigger entity to negotiate better rates with managed care, a generational shift as younger doctors decide they want balance between life and work (especially women, who now comprise the majority of medical students), and the rising overhead involved in running a practice. Ironically, physicians I’ve spoken with have cited the cost of health insurance for staff as a reason for joining up with the big boys!
• ObamaCare does not require anyone to be in an ACO and does not require them to be run by hospitals. Physicians could organize their own ACOs and I hope in the future more do, even if that hasn’t been the way things have gone so far
• Health IT is a drag on small office but also for big hospital based systems. Those inefficiencies will take a few years to work out but I’m optimistic that a new generation of systems will empower the small physician practice, the way technology has made it possible to operate smaller professional services firms in consulting, law and other fields
• Costs are becoming a bigger and bigger focus, and the country just won’t tolerate health care prices that go up and up. The facility fee issue and Steven Brill’s article in Time on costs are two examples. It’s commercial health plans, not government programs, that have been tolerating higher costs. Buying up physician practices may help hospitals negotiate hard with commercial health plans but Medicare and Medicaid are not going to be impressed. In the long run –maybe 10 years– hospital systems that fail to generate greater efficiency from buying up practices will lose ground to new types of entities, especially those that are virtually integrated through technology. As Gottlieb pointed out, we’ve been through the cycle of physician acquisition by hospitals before, and it was reversed due to lagging productivity
• ObamaCare represents a great big target to shoot at, and easy to criticize in a vacuum. But we have to compare it with what came before, which was hardly a panacea.

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So it’s fitting that I received so many high quality submissions for today’s Health Wonk Review.

On the Health Affairs Blog, former Surgeon General David Satcher eulogizes former Surgeon General C. Everett Koop, who passed away recently at age 96. He praises Koop for his courageous response to the AIDS epidemic and continuing the fight against tobacco use.

“Given the sexual, racial, and drug-related issues around the transmission of HIV…, he demonstrated unusual courage and fortitude in bringing these topics to the attention of the American people in the face of resistance within both Congress and the White House.  The major resistance to his report on HIV/AIDS stemmed from the need to explicitly discuss how it was transmitted heterosexually and homosexually.”

Steven Brill’s high-profile Time article on medical costs garnered attention from two bloggers.

In Sight (while admitting a bias in favor of hospitals) contends that Brill’s focus on chargemasters, which represent hospitals’ rack rates for services, is a distraction. Few pay the chargemaster rate and hospitals are not nearly as profitable as Brill claims.

Meanwhile Health Access California notes that California addressed this issue back in 2006 with the Hospital Fair Pricing Act, and that the chargemaster does in fact affect people.

Affordable Care Act, aka ObamaCare partisans continue trying to sway us.

Insure Blog rags on ObamaCare, with a somewhat curious argument that insurers will price the bare bones policies in the exchange high to discourage adverse selection. A commenter makes a reasonable point that adverse selection is much more likely with the richer plans, not the bare bones ones, since high end plans are a better deal for the sick who use a lot of benefits.

Colorado Health Insurance Insider is skeptical about health insurance exchanges, in particular whether a government agency can provide the kinds of customer service that consumers have come to expect from commercial health plans, insurance agents and financial institutions.

Managed Care Matters addresses criticisms of ObamaCare re: cost control, expense of the program, socialism, injection of the government into doctor/patient relationships. Conclusion:

“It is a lot better than what we had before. Which, for those with short memories, was a completely out-of-control health system with declining numbers of insureds and rapidly rising costs.”

Healthinsurance.org interviews Medicare Payment Advisory Commission (MedPac) vice-chair Michael Chernew, who discusses most of the ObamaCare issues described above.

A couple of our bloggers favor giving providers more control of packaging and pricing.

Diners wouldn’t think of telling a restaurant manager how to package and price his menu offerings, and so  John Goodman’s Health Policy Blog suggests letting providers package and price their services rather than expecting third-party payers to dictate how it’s done. The post makes its point, but the restaurant analogy is a bit strained. There’s usually no third-party payer in the restaurant, people go voluntarily, and there are many choices.

On the other hand, it reminds me of a story from my first job out of college. A colleague who had been a starving student for years was enjoying the third-party payer opportunity posed by having our employer pick up the tab for dinner. When at a restaurant he would joyfully scan down the price column of the menu saying “@max, @max, @max” –mimicking the Lotus 1-2-3 function– to find the most expensive item, which he would invariably order and enjoy.

Wright on Health touts one of my favorite ideas: direct health care providers, and this post’s use of the term “menu” is more apt.

“These direct providers are able to combat many concerns through price transparency, easy access and lower costs as they establish what is basically a menu of cash only services. Further, these one-on-one scenarios improve decision-making between patient and physician and take out the need for insurance and proof of citizenship.”

Nearly 35,000 people (me included) were at the Healthcare Information Management Systems Society (HIMSS) conference in New Orleans last week, but I just got one submission.

Healthcare Talent Transformation encourages us to stay patient on cost savings from health IT adoption.

“Technology usually brings with it a falling cost curve. But the reality is, for now, we are still undergoing the transformation stage and the transition is rocky and costly.”

Since this section is surprisingly light I’ll go ahead and toss in my own post on HIMSS: What’s new at HIMMS? Airbnb. Although we may need to wait for IT to bring cost savings to health care, Airbnb has used consumer Internet tools to radically transform the lodging industry. I personally saved hundreds of dollars in New Orleans in one night.

We don’t get enough pharmaceutical related entries these days, so I’m happy to have these two.

Drug Channels chronicles the rapid growth of preferred pharmacy networks for Medicare Part D, and looks into why CMS says it is “concerned” about the trend.

Healthcare Economist investigates whether recent court rulings will hobble FDA’s ability to regulate the off-label promotion of pharmaceuticals.

When bad things happen, our bloggers are there to tell us about it.

Health Care Renewal is not pleased to see for-profit methadone clinics owned by Bain Capital, and says its practices appear to be enabling diversion of drugs to others, some of whom have overdosed.

“I submit that putting patient care into the hands of organizations whose leaders relentlessly seek profits ahead of all else is a bad idea.  True health care reform would ensure that health care is only directly provided by health care professionals and non-profit organizations which are directly responsible to their communities and the public.”

This one’s a little removed from health policy, but since I can’t imagine a Health Wonk Review without a post from Workers’ Comp Insider, I’m sharing this one commemorating the third anniversary of a mine explosion that killed 29 workers and reporting on the latest developments in the investigation.

Ending up with Big Data.

Disease Management Care Blog –in its typical trenchant style– takes a deep dive into the Big Data pool to provide a definition that’s relevant for health care and to offer up a few caveats.

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The next edition of the Health Wonk Review will be hosted by Healthcare Economist on March 28.

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How widespread of a social media challenge are medical boards dealing with? Are there a lot of instances of doctors using social media inappropriately or is it relatively rare? 

Every profession adheres to a code of ethical behavior, but medicine carries an extra responsibility of safeguarding sensitive content, protecting patients and following privacy laws. Thus, the spotlight is cast on patient privacy violations conducted over social media, such as here and here. These instances are rare though, and state medical boards are now sensitive to these scenarios so that they can more quickly intervene. The “challenge” for physicians and medical boards is identifiying when, how and where social media technologies should be used to improve care delivery. Social media’s asynchronous and far-reaching properties are great tools for communication, continuous education and engagement beyond the 15-minute clinical appointment or physician phone call, and there are many physicians out there who will say that it’s had a very positive impact on their own practices.

What kinds of problems are typical?

Most problems can be traced back to HIPAA violations, such as improper de-identification of patient information or non-secure communication mediums.

Once the inappropriate behavior is pointed out, do the Gen Y doctors agree that it’s actually a problem, or do they disagree?

Tech-savvy Generation Y rode the first waves of social media as it crashed ashore, and in our experience most agree that embracing new efficient technologies can be done in a way that enhances and upholds the profession. Many young physicians choose to keep a Facebook profile, but they use privacy settings and know not to let it cross into their clinical practice, instead using tools like Doximity for professional conduct.

How have the norms changed over time?

The shift from in-person to online has been a slower one for the medical industry as a whole, but both patients and providers have grown to realize the real-time benefits of the right online or mobile technologies in information acquisition and secure communication. The greatest change in norm is increased familiarity and thus increased embrace.

How do patients feel about doctors’ online social networking behavior?

As patients ourselves, knowing that our physicians can have access to a national network of clinical experts right from their smartphone with a tool like Doximity is a technology milestone that we’re certain they should embrace.

What are the alternatives to general social networking sites? What are the pros and cons of using them? 

General social networking sites, while offering a large userbase, and not tailored for a specific industry like medicine, making it difficulty to find the right people to share with. Additionally, they often allow anonymity, which does not build a prerequisite level of trust for health conversations. Doximity is designed exclusively for health professionals, and each user’s identity is verified, thereby enabling an unprecedented level of collaboration around patient care.

Some well known sites, like Sermo, have fizzled. Why? 

Social media is a means to an end, not an end in itself. Doximity is the first secure network designed as a productivity tool by doctors, for doctors. Thus, even physicians that are too busy or too wary of common social media still choose to save time using Doximity’s national provider directory, mobile fax and secure messaging features.

How do you expect social networks for physicians to evolve over the next 5 years? Do you envision a role for doctor/patient interaction as well?

In the US healthcare system, patients on average see 19 different doctors in their lifetime, in the context of an industry approaching 20% of US GDP. It is clear that an interoperable, secure medical internet is critical, and Doximity’s growing platform and partners can streamline workflow and communication across the many participants in the system.

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Interview conducted by David E. Williams of the Health Business Group.

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• Hospitals are adding facility fees in the hundreds of dollars for many visits to hospital-owned physician practices, even when those practices are nowhere near the hospital
• Facility fees are becoming more common as hospitals purchase formerly independent physician practices and tack on the fees
• Patients are pushing back. One reason is that more of them have high deductible plans that force the patient to bear more of the cost
• Insurance companies are aware of the issue but have generally been allowing the fees

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Here’s how things worked for me:

About 10 days before the conference I decided to go. But with 35,000 attendees –many coming from Boston– there were no flights whatsoever on Sunday, March 3, when I was available to leave, even if I had been willing to pay $1000 one-way. So instead I got creative and booked a flight from Providence, RI to Gulfport, MS. That wasn’t ideal, and it’s the same thing I would have done a year or two ago. I decided to stay in Gulfport, then drive or take a cab 80 miles to New Orleans on Monday morning. No rental cars were available for that trip so a cab it was.

Lodging was another story, with a happier ending. Hotels anywhere close to the convention center were sold out, although I did find a room at the Hilton for $900. No thanks. A couple years back I would have found a room 30 or 50 miles away or looked for a friend with a place there. But I remembering hearing about Airbnb and decided to give it a try. There were several listings for individual rooms and even whole apartments and houses within 3 or 4 miles of the conference. Many individual rooms were under $100. I signed up for an account, which took very little time, then followed a number of steps designed to increase trust and safety: I verified my phone number, connected via Facebook, Twitter and LinkedIn. I filled out a brief profile.

I looked through the listings, which included photos, bios of the hosts, and lots of reviews by people who had stayed at the specific properties, as verified by Airbnb. Most reviews were pretty positive, but hosts had replied to negative ones and gone into detail. I got a much better sense of what I was in for than anything I’ve encountered in health care. I selected a room for about $80 (< 1/10 of the Hilton price) and tried to book it. I sent a message to my host explaining why I was coming and letting him know I was a nice guy. This host had a policy, enforced through Airbnb, of approving prospective guests before accepting them. According to the site, most hosts reply within a couple hours, but they have up to 24. When I didn’t hear back within 2 hours I selected another spot, advertised as Street Car to Jazz Fest/French Quarter, which allowed instant bookings. This place was only $60 for a private room plus another $10 cleaning fee and $8 for Airbnb itself. The hosts’ extensive description gave me a good understanding of the place, mentioned free Internet, restaurants within walking distance, etc. Reviews were generally quite positive –and although it sounded much more like my hostel experiences from 20+ years ago rather than my more recent travel preferences– I decided to go for it. Information on Airbnb showed that the hosts, Robyn and Amanda responded to 100% of their listings, response time was quick, and that they updated their calendar frequently.

I was also reassured my Airbnb’s 24/7 phone support and various safety and security tips and guarantees.

I’m glad I went the Airbnb route. My hosts and I communicated over the Airbnb website but I also was given their phone number and email address. We coordinated my arrival time, they offered me a parking spot (which I didn’t need) and when I got there they recommended a close by restaurant that met my needs and suggested a cab company. (It was United Cab, which didn’t show up even after I confirmed and re-confirmed, but that’s not my h0sts’ fault).

I met a young French couple that was staying there for a month, and there were a bunch of law students staying there doing volunteer work. They were downstairs, though, so not bothering me. I had a good night’s sleep and was on my way.

Airbnb released my $100 security deposit within 24 hours and sent me a message asking for a review, which I provided and is now published. My hosts also reviewed me, so future hosts can see what I’m like (laid back, according to my hosts). And Airbnb let me communicate privately with the company if I had concerns I didn’t want shared or posted. (I didn’t.)

As I wrote, Airbnb’s innovations don’t translate directly into health care. There are some companies, including Castlight and ZocDoc that apply certain aspects of the model, including transparency of data and ease of booking appointments. Newer companies including Informedika and par8o are applying some of the principles to physician consultations and referrals. But there is room for a lot more and I’m hopeful Airbnb and other consumer Internet innovators will be inspirations. In particular I’m hopeful that new approaches will provide an alternative approach for providers that don’t want to be parts of big organizations.

In the meantime, Airbnb itself is making a contribution to health care by reducing expenses and increasing convenience of conference goers like me. No doubt it’s also being used by families who need to travel to other cities for medical visits.

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I really enjoyed meeting with J.P. Fingado, President and CEO of API Healthcare, a health care workforce management solutions company. In this podcast interview, J.P. explains how API helps get the right people in the right place at the right time, how it optimizes the use of labor for hospitals, and how it improves worker satisfaction. He introduces the concept of an EER (electronic employee record) and HWIE (healthcare workforce information exchange).

I was impressed by the inclusion of external staffing agencies in the solution and how API matches workforce competencies with clinical needs.

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Disease Management Care Blog has important advice for boards of health service companies that use the results of their company’s sponsored or conducted research. Public domain, published or peer-reviewed research is highly vulnerable to data manipulation, conflicts of interest, skewed results, suppression of negative results and spin. Boards need to give it the enterprise risk management (ERM) it deserves.  He offers 10 approaches for audit committees.

Healthcare Economist investigates whether expansion of Medicaid crowds out private coverage.

The individual insurance market is set to undergo major changes next year. Colorado Health Insurance Insider has made a graphic to explain the shifts.

There’s a risk that EHR adoption will lead to improper billings that will wipe out any savings that accrue from better efficiency. Although some see this as a reason to gut the Meaningful Use incentive program, Health Business Blog is much more sanguine.

InsureBlog shares upbeat news on the breast cancer front: a new “smart bomb” that could reduce the risk of dying from the disease.

It’s one thing to sign your life away when you go sky-diving, but should parents really have to sign a comprehensive waiver of liability so that their children can participate in public school field trips?  Insurance Coverage Law in Massachusetts doesn’t think so, and blog author Nina Kallen is trying to do something about it through her testimony to the Boston School Committee.

Workers’ Comp Insider agrees with OSHA’s director that “A worker’s first day at work shouldn’t be his last day on earth.” She posts about a temporary worker killed at a Bacardi Bottling plant on his first day of the new job. 

Workers Comp Roundup counsels that employers should work with their employees who are filing claims rather than letting them fend for themselves.

Data breaches seem to be occurring a lot more frequently. Risk Management Monitor notes that what used to be a once-a-week data breach email alert from DataLossDB.org, an open security foundation, now comes as multiple emails, several times a day. Quite frightening.

That’s it for the Cav. Our next host is Jacob Irwin from My Personal Finance Journey.

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The following guest post was written by Pritikin Research Director and UCLA professor, James Barnard, PhD.

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We’ll start by talking about what’s good about the newly published study (1) that garnered headlines like “Mediterranean Diet Shown To Ward Off Heart Attack and Stroke.”

The study affirmed the benefits of a healthy diet even for people already taking medications for high cholesterol, blood pressure, or diabetes.

The takeaway:  Drugs have benefits.  Drugs plus diet have even more benefits.

And there’s no question that a Mediterranean-style diet (fruits, vegetables, legumes, fish, whole grain, nuts, olive oil, wine) is healthier than a typically American diet, full of fast food and other artery-cloggers like cheese, butter, red meat, processed meats, refined flour, sugar, and salt.

Now to the problems (and there are many) with this study.  We’ll focus on three major ones.

• The study followed 7,447 people with heart disease risks who were randomly assigned to either Mediterranean-style diets or a low-fat diet, but the low-fat diet was not low in fat.  Not even close. The people in the “low-fat” group started out with a diet that was 39% fat.  They decreased fat intake to 37%.

So, the authors weren’t really comparing a Mediterranean diet to a low-fat diet.  It’s much more accurate to say they were comparing a Mediterranean diet with a fatty American-style diet.  And sure enough, a lot of the foods the so-called “low-fat” group was eating were heart-damaging foods like red meat, commercially baked goods full of refined flour and fat, and sugary sodas.

• Some argued that the people in the “low-fat” group were unsuccessful in reducing their fat intake because a low-fat diet is too difficult to maintain, but it could also be argued that the scientists conducting this study never really gave the “low-fat” diet group a chance.

During the first half of the study, the people assigned to the Mediterranean diet received intensive education in eating well, including regular visits with registered dietitians.  The people in the “low-fat” group got one visit.  That’s it.  It was the equivalent of a doctor’s visit in which the doctor hands you a pamphlet with what to eat, and what not to eat, and essentially says, “Good luck.”

Moreover, the “low-fat” diet that the scientists designed excluded an important food proven to protect against heart disease, a food that is a part of many low-fat plans, including the Pritikin Program – omega 3-rich fatty fish.  The subjects in the study were discouraged from eating fatty fish like salmon.

And ironically, this “low-fat” diet devised by the scientists had no limits on some foods known to increase heart disease risk, like soft drinks.

• The scientists summarized that the Mediterranean diet “reduced the incidence of major cardiovascular events” compared to a low-fat diet, and media articles led with announcements like “30% of heart attacks, strokes, and deaths from heart disease were prevented.”

But in the study itself, the scientists reported no significant reductions in heart attacks or cardiovascular-related deaths among the Mediterranean dieters. They wrote, “Only the comparison of stroke risk reached statistical significance.”

So how did they jump from stroke reductions to all reductions in cardiovascular risk?  Well, it’s easy when you know how to play with numbers.  They pooled all the data on heart attacks, strokes, and deaths, and the numbers on strokes were high enough so that the average of the three looked good.

Bottom Line:  It appears that the scientists were doing everything they could to make the Mediterranean diet the winner.  Why?  We don’t know for sure, but consider this:

The olive oil, nut, and wine/alcohol industries were very involved in this study.   Two olive oil companies supplied all the olive oil.  Two nut companies supplied all the nuts.  The lead author, Dr. Ramon Estruch, has served on the board and received lecture fees from wine groups like the Research Foundation on Wine and Nutrition and the European Foundation for Alcohol Research.

The other authors of the study have deep ties with other olive oil, nut, and wine groups such as the California Walnut Commission, the International Nut and Dried Fruit Council, the Mediterranean Diet Foundation, and an wine/alcohol public relations group in Spain called Cerveceros de España.

Yes, it could be argued that these scientists had a vested interest in making the Mediterranean diet look as good as it possibly could.  By contrast, there was no financial interest in making the “low-fat” diet look good.

What would have been a far better study is one in which a Mediterranean diet was compared with a truly healthy low-fat plan like Pritikin.

Pritikin includes all the excellent elements of a Mediterranean diet (fruits, vegetables, whole grains, legumes, fish) as well as the ability to shed excess weight (something the subjects in the Mediterranean study did not achieve) because on Pritikin calorie-dense foods like oil and nuts are kept to a minimum.

So strong are the data affirming the heart-healthy benefits of the Pritikin Program that Medicare is now covering it for people with a history of cardiovascular disease.

In summary, the Pritikin Program combines daily exercise with an eating plan that emphasizes:

• Hearty consumption of fruits, vegetables, whole grains, and legumes like beans
• Moderate intake of fat-free dairy products and lean animal protein like fish, skinless poultry, and bison
• Little or no intake of added sugars, saturated fats, trans fat, and sodium (no more than 1,500 mg of sodium a day).

Is this a low-fat diet?  Yes.  Average intake is about 10 to 15% fat.

But more importantly, it’s an extremely healthy diet, proven in more than 100 studies over the past three decades to dramatically reduce virtually every modifiable risk factor for cardiovascular disease, including LDL bad cholesterol, trigylcerides, blood glucose, insulin, hypertension, inflammatory markers like C-reactive protein, and excess weight/obesity.

A study comparing this type of healthy, low-fat diet with the Mediterranean diet would have been a study that deserved headlines.  Not the study that was published this week.

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Most studies still show the rate of pediatric CT going up, but a new paper and my anecdotal observations make me more optimistic that the trend is abating if not reversing. Fierce Medical Imaging has the story.

The new study shows the use of pediatric CT has stabilized or even decreased over the past few years (ending in 2010). This study is limited to hospitalized patients, which could easily explain why the results contradict other published data, but I’m glad to see a decrease in any population. Also a lot of the attention on radiation exposure has come since 2010 so perhaps we will see that show up in the next analysis.

In recent years I’ve had a couple of experiences at Boston Children’s Hospital where I kind of expected they would do a CT, based on the situation and from what I’d read about the tendency to use that modality. But the docs I met were very hesitant to use CT, treating it as more of a last resort. They were quite upfront that they were holding back over concern about radiation, and I had the sense that they were ready to push back if parents insisted on a CT. I’m the first to admit this is anecdotal information, and I don’t know if it even applies to the whole hospital, never mind pediatrics as a whole.

Still, it seems to be the tide is turning or has already turned on this topic, and I’m willing to bet there will be more studies that show similar findings over the next few years.

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Health Business Blog Celebrates Eighth Birthday

Award-winning weblog by Health Business Group President David E. Williams covers health care business and policy every business day. Will cover #HIMSS13 conference this week

March 3, 2013 – The Health Business Blog, the first weblog devoted exclusively to health care business and policy, has turned eight years old. The blog is celebrating the event with a special birthday edition, highlighting a popular post from each of the past 12 months. This week, the blog will cover the Healthcare Information Management and Systems Society (HIMSS) conference in New Orleans, LA.

You can read the full release at the new Health Business Group website.

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The Health Business Blog turns eight years old today. Continuing a tradition I established with birthdays one, two, three, four, five, six, and seven I have picked out a favorite post from each month. Thanks for continuing to read the blog!

March 2012: Should medical debt count against your credit rating?

As far as I’m concerned, a lot of medical debt isn’t real debt. Real debt is borrowing money from a bank to buy a car or using a credit card to finance a vacation or taking out a student loan to pay for college. Borrowers know ahead of time that they are incurring a financial obligation for a known amount of money for specific goods or services. Hospitalized patients receive bills that are often indecipherable, incorrect, and owed by an insurance company. Even when technically correct the amounts can be non-sensical and vary widely from provider to provider. So it’s seems wrong to me that even medical bills that are paid off –sometimes just to end the nuisance– can have a long-term, negative effect on one’s credit rating.

April 2012: I don’t really want my $127 medical loss ratio rebate

Under the Affordable Care Act, health plans have to issue rebates to policyholders if they don’t spend at least 80 or 85 percent of premiums on medical costs. Now that the law is in effect, about $1.3 billion is to be paid out.  I support the ACA but I don’t like the notion that any dollar spent on medical claims is good and anything spent on administration is bad. The rule discourages administrative spending to reduce medical costs and that’s a shame.

May 2012: Interview with Blue Cross Blue Shield of Massachusetts CEO Andrew Dreyfus

Blue Cross Blue Shield of Massachusetts (BCBS MA) is the largest health plan in the state, and is making waves with its innovative Alternative Quality Contract (AQC). In this interview, BCBSMA CEO Andrew Dreyfus and I discuss the role of BCBS in cost containment, why premiums are stabilizing, opportunities for employers to play a role, and how state government fits in.

June 2012: Is the GOP ready for a substantive debate on health reform?

There’s a good debate still to be held in this country on health reform, but only if the Republicans step up to the plate with serious ideas. I’m unimpressed with the five main ideas I’ve heard: buying insurance across state lines, small business purchasing pools, tort reform, block grants for Medicaid, and tax deductibility for individuals who buy insurance.

July 2012: Hey friend, can I interest you in a lung transplant?

It’s no surprise to me that hospitals are starting to advertise high profit services on Google and Facebook. According to a Kaiser Health News piece, University of Pennsylvania Health System is trolling for lung transplant patients. Spending $20,000 generated 4,600 clicks, 36 appointments, and at least one prospective patient. With lung transplant revenue in the range of $100,000 per patient, even one patient may be enough to justify the media spend.

August 2012: Medtronic’s doctor centered approach helps patients, too

Orthopedic device makers are putting more control in the hands of patients to make adjustments that used to be handled by physicians. It’s more convenient for patients, but the key to the business model is that such moves reduce the demands on physicians, who otherwise would have to participate in these low-margin, unexciting activities.

September 2012: Private insurance exchanges in the mainstream

I’m bullish on employer-sponsored health insurance exchanges and am happy to see the general media pick up on the theme. I understand why observers are nervous that the use of these exchanges will contribute to cost shifting but I think the concerns are overblown.

October 2012: New England Compounding Center –the Avastin/Lucentis connection

Genentech got a lot of grief back in 2007 for trying to keep Avastin away from compounding pharmacies, who were re-packaging the cancer drug to make a cut-rate version of Lucentis for wet age related macular degeneration. I defended the company and pointed out that the New England Compounding Center had been issued a warning letter about its lack of sterility control. Five years later nearly everyone was taken by surprise when New England Compounding Center was in the news for a contamination scandal that led to many deaths. Regulators have no excuse for not dealing with the company when they had a chance.

November 2012: All Payer Claims Database launches in Colorado

Colorado is taking a unique approach to its All Payer Claims Database (APCD).

The Colorado legislature mandated payers to submit data, but the effort is privately operated (by CIVHC) and financed by private health care conversion foundations rather than the government. Independent financing and governance make a significant difference. Initial reports are being made public soon after the data is submitted, unlike in other states that don’t make the data public at all or do so under major constraints or time lags.

December 2012: Facility fees for hospital-owned physicians offices –A nasty surprise for patients

When hospitals purchase free-standing physician offices they often convert them into outpatient clinics. The shift isn’t visible on the surface, but underneath the covers a powerful economic transformation has taken place, with the new owners now able to charge a so-called “facility fee” to cover the cost of their infrastructure. Medicare and commercial health plans routinely pay such fees. But patients are pushing back, as well they should.

January 2013: Health tracking apps –Not yet ready to make a big impact

Almost no one really uses smartphone apps to track their health. That’s my takeaway from the latest Pew Research report. Although the report says close to 70% of adults are tracking some health statistics such as weight, diet or medical symptoms most of them do so either in their head (49%) or on paper (34%). Until we get to really smart, passive devices, which will take a decade or more, you should expect to see successive editions of the Pew report saying more or less what this one says.

February 2013: EHRs and improper billing –Should we worry?

Concerns are emerging that the adoption of electronic health records is leading to inappropriate increases in billings to payers, including Medicare, and that these higher billings could undermine or even overwhelm any cost savings generated by the digitization of providers. The concerns are legitimate but overall I’m not worried about this phenomenon, at least in the long term.

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Thanks again for reading the blog!

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David E. Williams: This is David Williams, author of the Health Business Blog.

I’m speaking today with Anne Weiss. She is Quality/Equality Health Care Team Director and Senior Program Officer at the Robert Wood Johnson Foundation.

The Foundation recently released a report called The Revolving Door: A Report on US Hospital Readmissions, which uses data from the Dartmouth Atlas Project to show that many Medicare patients are readmitted to the hospital after being discharged. The report also includes results from interviews with patients and providers to provide insights into how to reduce avoidable readmissions.

Anne, thanks for joining me today.

Anne Weiss: Thanks for having me.

Williams: Anne, consistent with other Dartmouth Atlas Reports I’ve seen, there’s a lot of emphasis in this one on regional variation. So, my question to you is how significant is this regional variation for readmissions and to what extent do the outliers actually represent best and worst practices that should be emulated or avoided?

Weiss: We do see pretty significant variation in the rates of readmission for Medicare patients who go home after identical surgeries or identical medical problems. There are very different experiences around the country. This is 2010 data and we saw readmission rates for surgical patients ranging from 18% in the Bronx to 8% in Bend, Oregon. For medical readmission, again, 18% in the Bronx down to 11% in Ogden, Utah.

So it’s significant variation. This study is not designed to tell us about the practice patterns in these areas. We looked strictly at admissions and post-acute care. We do know that there are a lot of different reasons behind this kind of variation. You could see differences in the underlying health status of the patients. You can see differences in the quality of hospital care including discharge planning. You can see best and worst practices in care coordination. And this is really important; you can see a lot of differences in the availability of primary care locally and the availability of hospital beds.

We know that the Dartmouth Atlas has already demonstrated that the local supply of hospital beds drives practice patterns. So other things equal, I think we can assume that when there are more hospital beds, patients are more likely to be admitted and readmitted to the hospital.

So, the short answer is we don’t learn a lot about what the best and worst practices are from looking at the Dartmouth data. But it does tells us it’s a local problem; and our emphasis is on helping people at the local level look at their market circumstances and talk about solutions that will work for them.

Williams: It looks from the report that there’s been only limited progress on reducing readmissions, even though readmissions are something that people have at least been looking at for awhile. And it also seems like some of the efforts that looked promising initially have not proven to be sustainable. I realize it’s 2010 data, so maybe things have changed from there. I’m wondering whether there are examples of programs or approaches that had been shown to work well over extended periods of time.

Weiss: When we released the report, we featured a couple of models that do seem to have been picked up widely enough that I think it gives us hope that they can sustain their progress.

One is the Care Transitions Intervention, widely associated with Eric Coleman, a physician at the University of Colorado. It’s a four-week program with a transition coach who helps patients with complex conditions manage their medications and helps them know what to do when their condition gets worse. This has been picked up by about 750 organizations, including 34 who are a part of a major Medicare initiative, the Care Transitions Program. I have not seen specific data, and obviously, it hasn’t been years since this is in place. but the degree to which it has been picked up is pretty promising.

The other program that we featured is the Transitional Care Model developed by Mary Naylor (a nurse at the University of Pennsylvania) along with her colleagues. They provide very comprehensive training in the hospital and then follow up at home for chronically ill high-risk older patients. They use transitional care nurses. They have the skills of a nurse and the care manager and also a patient advocate. I know they’ve had a lot of very promising conversations with health plans and others. So again, I think that’s a sign that they are poised for the kind of sustainability you’re asking about.

I do want to make one other point about some of the programs that we’ve seen developed in communities that are involved in the Foundation’s signature initiative, Aligning Forces For Quality. This is the Robert Wood Johnson Foundation’s major effort to improve quality and reduce cost in 16 targeted markets around the country. And we’ve seen initiatives in places like Cleveland, Memphis, Maine and Oregon that haven’t been in place for a long time. We don’t have data that say that they’re sustainable, but the fact that they’re embedded in a larger community effort where there’s a great deal of transparency is promising. In many of these communities, there is a publicly available report online that compares hospital readmission rates.

They’re in communities that are working on payment reform, unbundled payments. They’re in communities that are working hard to build quality improvement infrastructure and to engage patients and families in demanding better care. I think that offers a lot of potential to sustain a good care transitions effort, although I can’t say today that we know that all these efforts will sustain themselves.

Williams: What can you say about individual patients and their families or caregivers who are perhaps in a region of the country that has above average readmissions, whether they’re in the Bronx or somewhere not quite as much of an outlier? Is there anything that an individual patient can do even in places where such programs are not in existence? And is there any evidence or do you have a sense of whether there are certain patients, perhaps those with higher levels of education or income, that are in a better position to make an impact on whether they are re-admitted?

Weiss: I don’t know from this study. We don’t know a lot about the specific characteristics of the patients. However, I think with rates that are this high, it’s not a problem that’s confined to patients who have low literacy or low incomes. I think if we talk about some of the things that patients and families can do, which I’ll mention in a moment, it suggests that these are things that can be done in a variety of socio-economic circumstances. So I don’t think it’s wholly dependent on family income or education level, although that helps.

The single most important thing we tell people to do is to ask questions, not to be afraid to bother the doctors and nurses and pharmacists, to keep asking until you understand the answer, and when you do get an answer to say it back, to repeat the answer to make sure you’ve understood it.

The second major area is to leave the hospital with a detailed written plan that covers two things — medications and appointments. So, a written list of medications with instructions about when and how to take them and a written list of follow-up appointments. The appointments are very important. If people have trouble making appointments or they don’t have a doctor, a family doctor, or the right specialist to go to, you can ask the hospital for help. And for both of these things, the medications and the appointment, I think it’s really important to involve a family member or a friend to make sure that they understand what could be done and they can help with things like transportation and making sure that you keep those appointments.

The last thing we tell people to do is to know what to do if you don’t feel well. Know the danger signs and know what you’re supposed to do if your symptoms got worse. I think it’s obvious that these things are more challenging for people who have low literacy or low health literacy. But I think all of them are things that any patient and family can try to become more engaged in.

I also want to mention that we have a great many tip sheets and other resources for patients at the website we set up for this initiative, which is called CareAboutYourCare.org. There’s a lot of information there that is really helpful for people from a very broad range of backgrounds and circumstances.

Williams: For a patient or a caregiver who is not currently contemplating a hospital visit, are there things that can be done perhaps structurally, and not just behaviorally, to try to make it less likely that a readmission would be needed? So for example, does it matter if a patient picks a primary care physician who practices as part of an integrated delivery network? Is there a difference in readmissions if the primary care practice uses hospitalists? Does it matter what type of health plan is used?

Weiss: Intuitively, it does seem that being part of an integrated system, your doctor being able to see you in the hospital, that those things should make a difference, but I have not seen data on this.

I will say that we conducted extensive interviews with patients and providers as part of the study and we did hear that the use of hospitalists can lead to more fragmented care, because the doctor isn’t always glued in to what happened in the hospital. That doesn’t mean that hospitalists are bad but it may mean that an intervention has to have an explicit step of getting the information back to the primary care doctor. And watching my parents in the health care system, I can’t think of how many times somebody threw a clipboard on their feet in the ambulance, and that was the extent of the information transfer.

Again, I haven’t seen information that compares the experience as patients in an integrated system or not. That does seem appealing, although we hope anyone who follows the weekly story about the safety implications of electronic health records can tell you that even in a completely integrated system, people miss pieces of information that were answered in one clinical setting and are relevant in another. So I don’t think you can let your guard down just because you’re in an integrated system. But you’re right, it’s promising.

And I know you said you wanted structural answers and not behavioral ones, but in my heart, I don’t think at this point in our health care system that there is a substitute for people understanding their conditions, understanding the behaviors that put them at risk, getting information that was proven to work, talking to the doctors, participating in making informed choices. And I don’t think we have the health care structure in the market yet that allows us to stop behaving that way as patient and consumers.

Williams: Fair enough.

So this sounds to me, Anne, like a problem that’s big, complex, perhaps even intractable. But the bright side of that might be some opportunities for entrepreneurs who are looking at ways to address elements of this readmission challenge. Any thoughts that you have for folks that are contemplating businesses in this area about where they might want to point their compass?

Weiss: A couple of things. I think the study does tell us that this is a local problem. And one thing we heard very strongly during all the public events was that you don’t pick something up in one market and just turn the key and it works in another market. Reinvention — what was it that somebody said — replication is reinvention. So, I think it’s important for entrepreneurs to think about that local market customization. That’s one point.

I think there is room for entrepreneurship across the continuum, whether it’s home care, whether it’s alternatives to the emergency department in the middle of the night, whether it’s new mobile technology. We heard from a patient who had a PDA that allowed him to answer five questions about his breathing condition every day; his nearest kin could monitor his status from afar and see how he was doing. So you could see all kind of mobile apps that could do that.

I think we have a payment system right now in this country where there’s a lot of financial rewards to a lot of people from the admissions. So for an entrepreneurial solution to work, it’s going to have to pay better or differently from readmission. The Medicare policy for readmission will start to rebalance that equation, but I think that’s a challenge.

The last thing I want to say is probably a little provocative to say to your readers. But I will say it anyway. I’ve been interviewed frequently about things like the company that provides care coordination to large employer groups. “If you get cancer, our company will come in and manage all your appointments and help you keep track of all the billing and everything.” And to me, that’s a symptom of what’s wrong with our health care system. And people will hold it out like, “Isn’t this great that we’re helping patients.” And I think that is true. I do think that a lot of the entrepreneurial opportunities have a lot of potential for improved care. But the problem we’re seeing here is a bad problem and my hope would be that we have a health care system that is patient centered enough that we don’t always need entrepreneurship to cure the ills that shouldn’t exist in the first place.

So I have mixed feelings about it but I do think that there are a lot of opportunities in the short run to make things better for patients and family.

Williams: I see on the motto of Children’s Hospital things like, “Until there’s no more childhood illness.” I think the children’s hospitals are busy trying to put themselves out of business. But they have no real fear of that happening in the near term. This may be something similar.

Weiss: Right, I mean it’s sort of like the argument we often have on primary prevention. And yes, we definitely can prevent a lot of chronic illness, but most cases of cancer are not preventable. We don’t know enough about them to prevent them. It’s a lot of things, so we still have a lot of room to make our health care system perform better and meet people’s needs. Some of the best opportunities right now, I think, are coming from innovative entrepreneurs.

So, in the short run, I think there is room for that. I just think it’s important for us to also keep track of the overall impact of the system on patients.

Williams: I’ve been speaking today with Anne Weiss from the Robert Wood Johnson Foundation. We’ve been talking about a new report on hospital readmissions and about RWJ’s Care About Your Care Initiative.

Anne, thank you so much.

Weiss: Thanks for having me.

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• The CEO of the Physicians Foundation says ACOs have already failed, because consolidation of provider systems leads to higher prices than with independent physician practices
• An MD/PhD asserts that in seeking low cost, access and quality only 2 out of 3 can be achieved
• The Chief Medical Officer of Cigna reports good initial results from experience with 50 ACOs
• A surgeon is concerned that ACOs will keep too many patients in primary care and away from specialists
• A physician complains that patients still have no skin in the game and that the liability system needs to change
• The CEO of a Medicare Advantage insurance company touts the quality and cost benefits of ACOs

So there you have it. I see merits and flaws in all these arguments. There will be plenty more to discuss as the ACO experiment proceeds.

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The researchers posed in each call as one of four types: a wealthy banker in good health, a wealthy banker with diabetes and back problems, a welfare recipient in good health, or a welfare recipient with diabetes and back problems.

Overall, the callers were 50% more likely to be offered an appointment when they posed as bankers than when they posed as welfare recipients.

‘Staff at physicians’ offices may hold negative attitudes toward this group, especially toward people receiving social assistance,’ the authors wrote. ‘Physicians have been shown to perceive patients with low socioeconomic status more negatively in terms of their personalities, abilities, behavioral tendencies and role demands.’”

Certainly the results sound bad and are consistent with the general notion that rich people get away with things while the poor get the shaft. But do Canadian primary care offices routinely try to assess the socioeconomic status of patients? It seemed odd to me.

So I read the original study (which is not linked to in the article) and my assessment is that the methodology is biased. Researchers were given scripts to use when calling the doctor’s office and were told to read them neutrally. Even if we assume they were able to be neutral (which I doubt) the language is biased in a way that throws the results and conclusions into question.

Let’s compare the wording of the two questions:

“Hi, I was just transferred to Toronto with [name of major bank], and I need a family doctor for my diabetes and back problems. Is Dr. ____ accepting new patients?”

vs.

“Hi, I’m calling ’cause my welfare worker told me that I need a family doctor for my diabetes and back problems. Is Dr. ___ accepting new patients?”

The researchers assume that the only important difference between these scripts is the information about whether the person is employed in a highly paid job or is on welfare.

I disagree. In particular, the first patient sounds like a self-motivated individual who is calling because s/he is conscientious and is making an effort to be responsible and take care of him/herself.

The second patient sounds like someone who is calling because they were told to, not because they wanted to. And why on earth does the script say “’cause” instead of because? Now imagine switching around the script so the banker is calling “’cause my wife told me I had to” and the second calls to say they needed a doctor and doesn’t make it sound like someone else told them to do so.

My guess is that the main driver of the results is that office staff are giving priority to a patient who is motivated to show up for appointments and be compliant with therapy rather than one who sounds like they’re calling just so they can tell their welfare worker that they did what they were told. If the caller hadn’t told the office of their profession or welfare status I doubt the office would have raised it. 

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The report has generated a good deal of press interest, so I decided to delve a bit deeper in this interview with Anne Weiss, Quality/Equality Health Care Team Director and Senior Program Officer at RWJF.

In this podcast we discuss:

• The significance of the regional variation in readmissions, and whether the variation reflects true best and worst practices to emulate or avoid, or whether other factors are at play.
• Reasons behind the lack of recent progress in reducing readmissions.
• What influence patients and caregivers have on whether a specific patient will need to be readmitted once discharged.
• Whether patients can do anything ahead of time –like picking a certain type of primary care practice– to avoid being readmitted if they are ever hospitalized.
• Opportunities for entrepreneurs to address the readmissions challenge –in the short term and long term.

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Last month I noticed that the store brand “pure” vanilla extract I had just purchased contained corn syrup, whereas the brand name version in my pantry didn’t. From the pharmaceutical industry I’m used to generic products being essentially identical to branded items, and I guess I just assumed the same was true with foods. Turns out that’s not the case, at least with vanilla.

I sent the following email to SuperValu, whose name was on the Shaw’s brand product, on December 18:

“In the past I have purchased McCormick Pure Vanilla Extract. This time I purchased Shaw’s Pure Vanilla Extract. When I compared the labels I was disappointed to see that while both products contain vanilla bean extractives in water and alcohol, the Shaw’s product also contains corn syrup.

How much corn syrup is in there and why?

It seems to me that it is misleading to refer to the product as pure and then include corn syrup. What do you think?”

I received a response within two hours. SuperValu didn’t know the answer but promised to check with the supplier to find out the answer within about five days. I was just starting to think they’d forgotten about me when I received the following email today:

“Dear Mr. Williams:

Thank you for taking the time to contact us. We welcome the opportunity to address your disappointing experience with our Shaw’s Pure Vanilla Extract.

Pure Vanilla has a standard of identity provided by the Federal Government. This means the formula must contain certain ingredients which are standard to that particular product.

The word pure indicates the vanilla flavor comes only from the extractives of the vanilla bean. The amber colored liquid known as pure vanilla must also contain, at least, 35% ethyl alcohol and is the extractives of 13.35 ounces of vanilla beans. Other optional  ingredients that may be added to pure vanilla are sugar or corn syrup which enhances the delicate vanilla flavor.

If you wish to respond to this note by e-mail, please include your name and e-mail address.

We hope to have the continued pleasure of serving you.

Sincerely,

[Name of  Person]
Consumer Affairs Specialist”

Interestingly, the email was from McCormick Consumer Affairs, which I assume means McCormick makes both the branded and store brand versions on sale at Shaw’s. That’s a different story from what I see on store brand OTC medicines, which often contain explicit labels indicating they are not made by the branded producer.

This Yahoo Answers page indicates that corn syrup is used to mask inferior beans, which sounds like a logical explanation. Even if the beans are the same quality it’s probably cheaper to include some corn syrup.

In any case, it’s back to the pricier brand name version for me next time. And I still think it’s misleading to call this product “pure” even if the government allows it.

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The Wall Street Journal devotes its Journal Report section today to pro/con debates on six health care issues. Five are reasonable and either timely or timeless: Should everyone be required to have health insurance? Should healthy people take cholesterol drugs to prevent heart disease? Should every patient have a unique ID number for all medical records? Can accountable-care organizations raise quality while reducing costs? Should patents on pharmaceuticals be extended to encourage innovation?

But one –Should physicians use email to communicate with patients?– should have been settled more than 10 years ago. It’s almost a joke that it’s still being asked, and at first I thought the question was about whether doctors and patients should still be using email as opposed to whether they should be trying it for the first time. Dr. Joseph Kvedar of the Center for Connected Health trots out all the well-rehearsed arguments that have been used over the past 15 years to encourage patients to use electronic messaging with their patients. And I agree with it all:

• Privacy concerns are overblown and not unique to electronic media
• Not every interaction needs to be in-person
• Doctors won’t be inundated with messages, despite their fears
• Patients feel more connected to their physicians when they can reach them online
• Electronic communications promotes efficiency
• Liability issues are mino

Dr. Sam Bierstock, founder of a health care-IT consulting firm, takes the con side of the argument. He’s probably an intelligent guy and knowledgeable about health IT. I’m guessing he jumped at the chance to write a piece for the Journal (and even have his picture published) –even if it meant taking a silly, losing position. Kind of like the Washington Generals, who used to play against the Harlem Globetrotters.

Bierstock concedes that “email can be useful for certain very basic patient-doctor communications” but then lays out a bunch of arguments that aren’t terribly persuasive:

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Health plans have realized for quite some time that the widespread practice of scheduled C-sections and induced labor before the end of 39 weeks of pregnancy is an expensive proposition. Even babies born a week or two early have a significantly higher chance of being admitted to neonatal intensive care units, having difficulty breathing and experiencing bloodstream infections. Such births are surprisingly common. In 2010 about 17 percent of babies were delivered at 37-39 weeks without a medical reason.

The Leapfrog Group. March of Dimes and American College of Obstetricians and Gynecologists has taken the initiative to try to address this issue by getting the word out and having hospitals set performance. They’ve decided there’s no reason for hospitals to have more than 5 percent of births in the early delivery/no medical reason category, and have asked hospitals to report their results.

The good news is that it seems to be working. The rate dropped from 17 percent to 14 percent from 2010 to 2011, according to newly published figures.  More than 700 hundred hospitals voluntarily reported their rates to Leapfrog. It’s fascinating to scroll through and see the variability. A good number of hospitals are at or below the 5 percent target while some others are way up in the 20 to 30+ percent range. That can’t be random variation.

So why are these medically unnecessary early births occurring? Childbirth Connection has a good summary:

• Women’s lack of knowledge about the risks, benefits, and appropriate use of labor induction
• Lack of shared decision making
• A perception among women, caregivers and hospital administrators that induction is convenient and cost-effective
• Frequent use of screening tests at the end of pregnancy, despite lack of evidence of improved outcomes
• A belief that the best way to manage risks in pregnancy is to deliver the baby

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Peter J. Neumann, ScD runs the Center for the Evaluation of Value and Risk in Health (I’m an advisory board member there) so he’s well placed to initiate a forthright discussion of costs, as he’s done in today’s New England Journal of Medicine. See What We Talk about When We Talk about Health Care Costs.

Neumann focuses on a statement from the new edition of the American College of Physicians’ Ethics Manual:

Physicians have a responsibility to practice effective and efficient health care and to use health care resources responsibly. Parsimonious care that utilizes the most efficient means to effectively diagnose a condition and treat a patient respects the need to use resources wisely and to help ensure that resources are equitably available.

The term “parsimonious” has generated a lot of pushback. That’s not unexpected, because policymakers, the health care industry and consumers continue to studiously avoid serious discussions of cost. Neumann is on the side of the ACP, and makes the following key points:

• The embrace of “more efficient, more effective, and safer care” and reducing waste is sensible and productive, but won’t really address cost growth
• Society has to face the fact that unlimited access and unlimited patient choice are unrealistic
• The Affordable Care Act’s restrictions on using comparative-effectiveness research for coverage decisions and its ban on the use of cost-effectiveness thresholds will limit the law’s impact
• It’s nice to have a “patient-centered” approach to outcomes research embodied in the Patient-Centered Outcomes Research Institute, but it hinders the cost debate by de-emphasizing “considerations of societal resources”
• Accountable Care Organizations (ACOs) are actually well placed to employ “parsimonious” care, but no one speaks in those terms
• The ACP is performing a real service by bringing up a topic that isn’t being discussed honestly

I’m fully on board with Peter, and would add a couple observations from recent news:

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• EHRs and improper billing: Should we worry? discussed the emerging controversy over whether savings from EHR usage are being lost to inappropriate billings. The post explains why this concern is overblown
• Informedika automates diagnostic lab ordering and results reporting is a podcast with the CEO of a startup company seeking to improve lab connectivity
• Bionic eye: seeing the future reports on a new medical implant and speculates on the ethical implications of the next few decades, as bionic parts exceed the performance of our original equipment
• Putting the brakes on health care costs is an optimistic (naive?) look at what would happen if health care cost inflation continues to decelerate
• Rejecting Medicaid expansion is effectively raising the minimum wage notes that it’s not so easy for opponents of the Affordable Care Act to maintain their ideological purity

Visit the blog to read the full stories, subscribe to the blog via email or RSS, or follow David Williams on Twitter.

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Fast forward a decade or two or three and imagine a time when implants (or some other approach) can restore vision to normal. That will be pretty cool for the many people whose vision is relatively poor and there will likely be a lot of demand for such treatments/devices, even from people that we would not consider visually impaired today.

But then imagine that the technology keeps advancing and gets to the point where technology can improve on natural vision, so that someone with a bionic eye becomes more like the Six Million Dollar Man, especially if they get enhancements not just to the eye but to other body parts as well. I’m in my mid-40s and have a reasonable expectation of living to the time when this moves from science fiction to reality.

If you think about it, we are already starting to get there in limited cases.  Oscar Pistorius, now infamous for other reasons, shows that a double amputee can be as fast or faster as Olympic runners. How soon until other Olympians –who already commit their lives and bodies to the pursuit of excellence– will want body modifications to improve competitiveness?

Obviously the path of medical technology will raise all kinds of ethical issues. It’s time to start the discussion.

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Here are the key issues:

• It didn’t take long for some physicians to figure out that they could essentially use the EHR to cut and paste records from a patient’s past visit or even from another patient’s records. As a result the record is much more thorough than it would have been otherwise and may describe more billable services than were actually performed.  This practice has been termed “cloning.”
• A second issue –as documented in the Center for Public Integrity’s Cracking the Codes– is that providers have been finding ways to bill Medicare more intensively for the same level of actual services. This has been going on for 10 years or more, but is apparently being accelerated by EHR adoption.

My take is as follows:

• The first issue is a transient one. Sure, some doctors found a lazy, seemingly clever way to save time and maybe make more money. But this practice is bad medicine and a flat out abuse of the system. To me it’s not so different from a doctor who reuses a disposable needle. They should only need to be told once that this is unacceptable. With EHRs it might take a bit of time to work out the norms and protocols to avoid cloning, but it will have to happen. Risk managers will insist on it for one thing. For another, one of the good things about a computer is that it can generate an audit trail. The cutting and pasting can be detected and flagged electronically, if not by the current generation of EHRs then by the next generation of fraud detection software. And patients will be angry if they find out this is happening to their records, and will increasingly vote with their feet.
• The second issue is only partly a function of the EHR. The bigger issue is the way billing is done. First, if providers can find a way to better document the work they are actually doing, then it’s reasonable for them to take advantage of that and bill for whatever’s allowable. Being able to fully bill acts an extra incentive for EHR adoption, above and beyond the Meaningful Use incentives. As long as the extra documentation for billing is the result of more robust clinical documentation (of work that is actually performed) then I’m all for it, because that clinical documentation could be useful for quality improvement. Of course, some of the billing is illegitimate, and again should be tracked down and disallowed.
• Finally, this controversy sheds more light on the limitations of fee-for-service medicine, where doing more things to a patient results in higher pay. If concerns about billing games help accelerate the shift away from fee-for-service then I’m all for it.

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Informedika has spent the last few years putting together an “e-requisition network” to enable physician offices to connect electronically with labs. The solution is catching on with physicians in the Bay Area and is starting to spread virally as physicians use the built-in referral feature to get others in their network onboard. I spoke today with Informedika’s CEO, Steve Yaskin who explained the system.

The core functionality and viral nature of this solution are interesting. Providers are also likely to be intrigued by the ability to use Informedika to document and get paid for post-discharge care such as reviewing lab results. According to Yaskin there are CPT codes associated with these activities, but few providers make use of them due to the difficulty of documenting the work with traditional EHRs and practice management systems.

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Whether it’s the Affordable Care Act or broader changes in health care delivery and financing, the ship is finally starting to turn. Notably, though, even if the growth of health care costs just matches overall economic growth there will still be a budget pinch, albeit a less painful one.

Although it may seem farfetched, there’s actually no reason to believe that health care has to grow as fast as the economy over the long term. There is so much inefficiency and sheer waste in the system that health care spending could actually drop over time if the system transforms sufficiently. And that may be the big shocker of the 2020s –that health care costs start dropping and the US’s fiscal outlook improves dramatically.

Health care represents a much lower percentage of GDP in other advanced countries than the US. Although that situation can persist for a long time eventually I expect to see some convergence.

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The Medicaid expansion is an even tougher issue. From where I sit, states that refuse to accept the expansion of federally funded Medicaid are essentially putting through an increase in their state minimum wage. Here’s what I mean:

As the Wall Street Journal reports, low-wage employees could qualify for Medicaid under the ACA. If the states accept the federal expansion of Medicaid the federal government will pay the tab and the employers will pay nothing. But if the state rejects the Medicaid expansion employers will be responsible for insuring their employees or paying a non tax-deductible fine of $2000 per worker or so. That means anti-ACA states will be making the choice to increase the cost of hiring low wage workers –which will have the same impact as a substantial increase in the minimum wage. That doesn’t fit well with rhetoric that refers to ObamaCare as a job destroyer and touts the value of small business.

The article also reveals some of the mind-bending ironies driven by the fact that health care is such a large industry with a big government presence already. The Journal quotes the CEO of a home health care company in proudly self-reliant Montana, who is pushing for acceptance of the Medicaid expansion:

[The CEO] said he is constrained in raising prices for customers because most of his services are reimbursed at fixed rates by government health programs, including Medicaid, and that he would have to resort to cutting wages instead if he can’t find another solution.

So in other words, his private business relies on Medicaid as a major customer, and Medicaid is so stingy that he can’t afford private insurance for his employees but needs Medicaid coverage for them instead.

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It will be useful, though, if debate on the bill sparks a broader discussion of what data is stored by the state and even by private organizations. It’s probably too much to ask in 2013 that we move toward restrictions on what’s collected, but perhaps in a few more years the time will be right.

Think about what kind of information is out there and how it might be combined:

• Medical records
• Bank account and credit card transactions
• Automated toll transponder data
• Car location from license plate readers
• Whereabouts tracking data through cell phone location based services
• Google searches
• Mail services
• Social networking
• Customs and border protection information on crossings

Can we ever put the genie back in the bottle? If anything data collection will become more extensive over the next few years as facial recognition technology improves and deployment increases.

It’s reasonable to be concerned about the security of medical records, but the situation is a lot more ominous when taking into account the whole portfolio of information that’s out there.

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I was reminded of that in reading about how shared decision making is hampered by inadequate IT systems. According to FierceHealthIT (Busy docs, inadequate IT systems hinder shared decision-making):

IT systems used were found to be inadequate. Nearly all sites’ records lacked capabilities to flag patients as candidates for decision aids or to track patients through the process, such as whether the post-decision aid conversation had taken place. Though some sites used questionnaires to gauge patients’ values and preferences, there was no way to integrate that information into the clinical system, meaning that information had to kept separately and might not be available to the physician conducting the post-decision aid conversation.

None of the sites had an IT system that tracked whether the patient received care in accordance with his or her stated preferences. Those involved at the care sites suggested automating as much as possible the process of flagging patients to be given decision aids and handing that task over to a staff member other than the physician.

If you’ve worked with health IT systems, the situation described here will come as no surprise. But challenges like this are being addressed outside the health care system. Take Board Docs for example, which provides cloud-based document management systems specifically aimed at boards of directors. Read the list of features and you’ll see that it deals with a lot of the common challenges associated with preparing and managing board meeting materials. It’s a different set of challenges than what doctors and patients face in shared decision making, but the level of complexity and coordination is similar.

The good news is that physicians are being exposed to what really good health IT is, even if it’s not in their medical practice. They have iPads and smartphones, and use social networks in their personal life. If they serve on a board they may be exposed to Board Docs or similar services.

All that means that we can expect physicians to start demanding state-of-the-art tools in the office, and not put up with what the health IT industry has offered to date.

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The CDC/Substance Abuse and Mental Health Services Administration (SAMHSA) report indicates that about 30 percent of all cigarettes are smoked by the mentally ill. Compared with the overall population more mentally ill people smoke and those who do smoke more per person. The mentally ill are less likely than others to quit successfully.

I wrote about this very topic in 2007, when the estimate was the the mentally ill were smoking almost half of all cigarettes. The two points I discussed then are worth raising again.

First, there must be a reason why almost every schizophrenic smokes. Probably because smoking helps them feel less crazy. It’s still probably worth encouraging some mental health patients to quit but it’s not probably not so clear cut.

Second, if the mentally ill are smoking almost half the cigarettes they’re probably also paying about half the cigarette taxes. It’s been popular in recent years to jack up the cigarette tax to pay for social programs. Is it really fair to have the mentally ill pick up a disproportionate share of the tab?

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The story of Steward Health Care System is a vitally important one for Massachusetts. The Globe understands this and is devoting substantial resources to covering the company, including a lengthy front-page story on Sunday. But the Globe could improve its coverage by focusing more on substantive issues and less on superficial topics and complaints tossed out by Steward critics with an axe to grind.

Here’s what the Globe should be looking at:

• What role is Steward playing in helping or harming the goals of Massachusetts health reform? In particular, is Steward making it easier for employers and employees to afford health insurance as mandated by the law?
• What impact is Steward having on other health care providers, including community hospitals and academic medical centers? Is it taking market share away from one or the other? Is it forcing other providers to cut costs, improve service, merge, raise capital or otherwise act differently?
• What is the impact on communities and the state overall of having a new for-profit, tax-paying entity replace non-profit, largely tax exempt hospitals?
• How is Steward affecting health plans’ offerings, and do the plans consider Steward an ally or a competitor or both?
• Is Steward improving or harming quality of care and patient experience or not?
• Why did Steward and Cerberus pick highly-regulated, non-profit dominated Massachusetts as the beachhead for a national strategy?
• Why is Steward taking such a hard line with nurses in its negotiations? What is the impact on affordability and patient care?
• Why have physician groups chosen to affiliate with Steward?
• What are the likely next steps for Steward once its key investor, Cerberus, reaches the end of its investment time horizon?

These are difficult but important questions. I’m a health care expert who knows Massachusetts well, yet I don’t have definitive answers to most of these questions. The Globe can and should devote its resources to understanding and addressing these topics.

Sunday’s article does address some of the important issues, at least in passing. We learn that Steward uses e-ICUs to control cost, and that Steward is focused on reducing readmissions and offering lower cost insurance products. We hear that the CEOs of Blue Cross and Tufts Health Plan consider Steward to be making a big impact. But much of the article –like the Globe coverage that has preceded it– is devoted to secondary topics that reveal the Globe’s open suspicion of Steward including:

• The replacement of a few security guards by a “New Jersey contractor with ties to Cerberus.” (Who cares if they’re from NJ since obviously the new guards will be working in MA? What does “ties to Cerberus” mean and why is that relevant or bad?)
• “Eyebrow-raising pacts” to refer complex patients to MGH and the Brigham. (The agreements are actually straightforward and the rationale is easy to understand.)
• Nurses complaining of their voices being stifled. (They would have been stifled a lot more if the Caritas hospitals had been closed rather than acquired.)
• The fact that Steward lost money in its first year of operation. (Of course it did. If the turnaround of nearly-bankrupt hospitals could have been accomplished instantly that would have been a lot more suprising.)

Ideally the Globe will publish a series of in-depth articles on Steward focused on the primary topics, providing readers and policymakers with greater insight than what’s been available to date.

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Lawyers are different. When it’s reported that only a little more than half of new law graduates get a job as a lawyer within 9 months of graduation, the Wall Street Journal rightly refers to a “lawyer glut.” Prospective applicants are getting the message and law school applications are down 30 percent since peaking a decade ago. On the other hand, those in the law school business are not giving up so easily. Nineteen law schools have been accredited since 2000 and several more startups are in the works. If these schools were smart they would take a page from the playbook of the nursing schools and support research to show why more lawyers are needed.

I’m not saying that the prospects for nursing jobs are as bleak as that for lawyers. But I do advise prospective students for any professional school to take a good hard look at job prospects before taking on a pile of debt and devoting several years to further schooling.

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Actually, I am at least as concerned as Leffell about the rapid switch of physicians away from independent practice. I’m cited in InformationWeek’s  2013 crystal ball article as predicting that doctors will continue to abandon independent practices. However, I added a hopeful caveat that I’ll explore further in this post:

“On the other hand we will see more independent physician practices adopt technologies that enable them to retain their autonomy, improve their financial performance, and serve patients better,” Williams said. “Staying independent will again feel like a viable option, and we may even see new physicians hanging up their own shingles again.”

I’ll admit that’s on the optimistic side, and its coming from someone who prefers to be a patient in a small practice rather than a large institutional one. But I truly believe that the small practice model can be viable. After all, other professionals with advanced training –including accountants, lawyers, and management consultants like me– have been able to leverage various tools to practice in smaller, more flexible settings than was possible a decade or two ago. These arrangements are rewarding to work in and better for clients (at least in my biased view). Granted, the dynamics of medicine are different, but many of the same lessons apply.

So, what needs to happen, and who can help?

First and foremost, physicians need to be able to get paid for their services in a timely fashion. For  better  or worse that still means dealing with third-party payment from health plans and the government. Athenahealth is the leader in the so-called “revenue cycle management” arena, offering a cloud-based infrastructure that ensures a steadier and more predictable cash flow than traditional billing services. Others, including electronic medical record vendors with integrated practice management systems like eClinicalWorks, help achieve similar results.

Another challenge beyond the timeliness and predictability of payments is the ability to get good rates for services provided. Independent physicians don’t have great negotiating leverage with payers, although with an overall shortage of physicians their situation isn’t as grim as it could be. One way to deal with the reimbursement challenge is to abandon independent practice and move over to a hospital-based system that has negotiated better rates. But IPAs (independent practice associations) can achieve much the same result if they’re savvy. Even better are the management service organizations like Women’s Health Connecticut, that put business people firmly in charge of the business aspects and let the doctors run the clinical aspects. Women’s Health takes matters a step further and operates its own malpractice insurance carrier, enabling it to take active steps to control the notoriously high malpractice premiums paid by OBs.

Health plans, employers and other buyers of health care also have a role to play by making sure that their contracting does not inadvertently erode the viability of the smaller practices.

Physicians can make the customer service and patient comfort aspects of their practices more inviting by taking a page from the dental industry, which is used to catering to self-pay patients and competing more on the service aspects. My dentist, Dr. Daniel Whiteman is a great example of a comfortable, modern practice with high-end equipment and customer care.

Smaller physician offices can also benefit from general service providers that figure out how to cater to their needs. For example, financial services companies have helped physicians offer ways for patients to finance self-pay procedures such as LASIK and cosmetic dentistry. But they could do more if they delved into the somewhat peculiar financial characteristics of physician practices and supported those needs with tailored product offerings and customer portals. Telecommunications firms also have the opportunity to segment out physicians and create packages just for them.

Even if the financial services and telecommunications packages are similar to what are offered to other professions, there is a real marketing opportunity for these firms to position themselves as supporters of small physicians practices, which are small businesses. For example, the Amex Small Business Saturday program is a terrific way to support small businesses and build goodwill among cardholders. Last year I went with a family member to a wonderful boutique wine merchant that I would never have patronized if it hadn’t been for the program. What is the equivalent for a physician’s office?

One of Leffell’s arguments is that standardization of clinical practice is coming, and can’t be enforced unless doctors are organized into huge groupings. That’s a fundamentally flawed argument in the age of tablets, smart phones and cloud-based information technology. There’s absolutely no reason that even a solo practice physician should have trouble adhering to clinical guidelines and best practices. These physicians should be able to access data on how other physicians like them are practicing in similar situations. There’s also no reason that clinical quality improvement has to lead to cookie-cutter medicine that doesn’t take into account the individual. If anything we should see unproductive variation reduced and an increase in personalized approaches. That’s what I expect from my physicians and it’s what I increasingly see. You don’t need a giant practice to access UpToDate or other clinical information and decision support tools.

As quality reporting evolves, these smaller physician practices should also be able to demonstrate how well they take care of patients. If they can show they’re doing a great job then I’m confident that in the long run they’ll be able to not just survive but to thrive as consumers increasingly take their business to those who can show they are the best, regardless of setting. In the meantime there’s plenty of opportunity for technology and business vendors to help these independent practices out and make a good return for their shareholders as they do so.

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I don’t think the current generation of health apps is going to take us very far. It’s tedious to enter data and many people would rather just forget about their illness then spend a lot of time gathering, entering and analyzing it. And even if the information is tracked it doesn’t mean it will be used.

I have had to maintain a medical journal, but I use a simple spreadsheet that I can print and email to the doctor. That’s despite the fact that there are some cute apps available that supposedly make things simpler. I’m definitely the exception in that I’m willing to track details accurately over a long period of time and use them in appointments and phone calls with physicians. And let’s face it, a high proportion of the 49% of people who say they track things in their head are deluding themselves about the quality of their data.

The key to health tracking will be passive data collection. Once the smartphone can keep an eye on its owner’s activities, symptoms and vital signs we’ll be in a whole different place. There will still be the need to sift through the massive amount of data generated to summarize it and glean the useful tidbits, but that’s actually an easier problem to solve than the passive sensor challenge.

Until we get to really smart, passive devices, which will take a decade or more, you should expect to see successive editions of the Pew report saying more or less what this one says.

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David E. Williams:  This is David Williams, co-founder of MedPharma Partners and author of the Health Business Blog. I’m speaking today with Rob Cosinuke.  He is Senior Vice-President and Chief Marketing Officer at AthenaHealth.  Rob, how are you today?

Rob Cosinuke:  I’m well.  Thank you.

Williams:  Let’s talk about AthenaHealth’s purchase of Epocrates.  Why is Athenahealth purchasing the company?

Cosinuke: The rationale is a pretty exciting for us. Athena’s core mission, which we live and breathe everyday, is to be care givers’ most trusted service.

If you think about Epocrates, they already have achieved this mission in spades. Epocrates has nearly 100% awareness in the marketplace.  It’s actively used on a weekly or daily basis by half of working physicians in the United States.

Over 340,000 physicians use Epocrates and it’s incredibly well loved.  There is a measurement that is used across industries called a “net promoter score.” And Epocrates, among physicians, has a higher net promoter score than even Apple computer users.  So it’s highly trusted, highly used, well loved.

We are acquiring Epocrates because we share that same mission of being the most trusted service of health care providers, but also frankly to take advantage of that awareness and love halo that Epocrates has to help folks begin to understand Athena and our unique model of cloud-based services.

Williams: Epocrates is always used as the example of the one thing that doctors adopted en masse. It’s interesting that Athena is going after it now.

The folks that first latched on to that opportunity were the pharmaceutical companies. Epocrates has traditionally made most of its money from those pharmaceutical company sponsorships, whereas obviously,  AthenaHealth has a different business model. So I’m wondering how those two things go together.

Cosinuke:  You’re right.  Athena has historically made its money on a fee for service basis to providers, from physicians and practices all the way up to the nation’s largest hospital chains.  And we’ve not made a business model around attracting revenues from pharma.

But in this case, Epocrates represents the explosion of viral usage among physicians at the point of encounter, in the exam room. And that’s exactly where pharma wants to be.

Epocrates has the history of being able to educate physicians in a way that does shift and move prescribing habits.

And so yes, it grew virally with explosive growth and it’s very much used by pharma to take advantage of that point of encounter education experience.

We see that as an opportunity to maintain that trust. Over time we may also look at other types of order sets beyond drug prescription and drug lookup needs. These other order sets include imaging and other diagnostics for which we might provide the same level of lookup services. We could also possibly extend the sponsor bench.

So we don’t see as an issue that it’s a different business model, because ultimately it’s an incredibly well loved service that’s being provided.

Williams:  Analysts have described this deal in terms similar to what you’re describing although I’ve never heard anybody else use the term “love halo.” That’s a new one to me, but it’s a good one.

I generally understand the concept of adding a channel to expand the distribution to physicians. But can you explain specifically how things will be different for a physician using Epocrates post-Athena acquisition ? And in particular, how might this provide a physician with more exposure to the other Athena products that are available?

Cosinuke:  We’re going to take a page out of their own playbook. Epocrates has a truly rigorous separation of church and state. Their med/pharma team is a team of real professionals, largely physicians or other health care providers by background.

The content creators understand how to “epocratize” content to make it highly accessible through the mobile channel, through the iPhone, etc.

And they really do separate what they allow the sponsors to provide from that content and they also ensure that what the sponsors provide is of equal value.

So there is a very rigorous hurdle that a pharma sponsor needs to get over, to make sure that what’s provided is a deep information service to the physician.

Essentially, pharmas get to compete equally on the content front with the med/pharma team for it to be a viable alternative and keep that love halo strong.

Athena –with its model of one instance of software– is collecting data and insight about the highest performing medical practices in the country and the highest performing physicians in the country. This includes care outcomes as well as financial revenue and profit gains.

We see that there’s an opportunity to provide really high value content on the core application around the business of health care. For example, there’s already a little widget on Epocrates that helps physicians look up CPT codes and the value of a particular procedure.

We have, through our database, the ability to look that up by specialty and even down to the zip code level.  As the network expands that content becomes richer and even more available.

So there are several possibilities around Meaningful Use and around the evolving requirements for best practices. We’ve got rich content that flows out of our database of users and we can begin to work with the Epocrates content team to understand how to make it well loved by physicians as well.

We will be playing using the same standards that Epocrates has. We have to have high integrity content applications that we can provide physicians around the business of managing their practice.

Williams:  Are there plans in place or could you envision them to strengthen some of the core Epocrates clinical content? I’m wondering, for example, whether Epocrates could be positioned to compete against other products. For example UpToDate is also loved and unlike with Epocrates physicians also pay hundreds of dollars a year for it. Are there opportunities to compete head to head with them or with other decision support tools on the clinical side?

Cosinuke:. We have almost 40,000 providers on the core network, and about 10,000 of them are on our EMR products. And we’re just beginning to see the tip of the iceberg of the value that we can create there. For example, Epocrates can offer value around its diagnostics support.

For example, a physician who is looking at a particular diagnosis might be looking up the medications to go with that, but might also want to know what other pediatricians in Pennsylvania prescribe at this point.  We can identify, for example, the top three order sets that come out of this diagnosis from the Athena EMR.

It’s another type of content that we could pull out of our system and provide that enriches the clinical content within the core Epocrates application.

And what you’re also talking about is the difference between the less than a minute interaction with patients sitting adjacent to the physician and the more than five-minute interaction that the physician might go through either with the patient there or after work or between patients, which is more of a desktop and/or iPad type approach.

Epocrates is looking at and we will help them at competing. You talked about UpToDate, Medscape and others that have that integrated platform with a desktop application or the more than five-minute lookup.

So we’re going to look at that, but I will tell you that one of the things that Epocrates has done really well and one of the things that Athena has done really well is to stay truly focused on what it’s good at and its core mission.

So we will look at expanding and competing with UpToDate and the Medscape on the desktop, but only if it’s supremely compelling against that core mission.

Williams:  I’ve heard your CEO Jonathan Bush talked about the concept of a national health information backbone that Athena is building and that pre-dates this deal, but is also being talked about in conjunction with the proposed acquisition of Epocrates.

Can you explain a little bit more about what a national health information backbone looks like from Athena’s perspective?

Cosinuke: Sure.  It’s also our competitive strategy against big iron: the Epics and the Cerners and the big hospital systems.  If you think about where the large software players are driving health information technology, it is not towards the same direction that, for instance, where financial services drove software.

In other words, health care does not operate the way ATMs operate.  There’s really no reason why health care information can’t be delivered ubiquitously over the Internet using secure protocols.

So that’s what Athena is doing. It’s trying to say, “One patient, one record, in the cloud, open.”  And that just because you’re a part of this health care system and you work under this thunder dome and you’re buying up these physicians doesn’t mean that that system actually can communicate with anyone else in the outside real world –say for instance, the CVS Pharmacy that is delivering all the flu shots in my town as opposed to primary care physicians.  So we’re looking at the idea of open, of a highly interfaced, highly integrated network and we’re building up that capability.

The beauty of what Epocrates brings is immediate scale.  Our service called Coordinator allows for the transmittal of a clean piece of highly structured health care information and allows for the receiver to actually pay for that clean piece of information. (This is based on an opinion from the OIG that we received last year.)

You could imagine that service being offered up on Epocrates and having half the physicians in the country have that tool like linked in at their fingertips.  It gives us massive scale to truly springboard this open network concept on the health care provider community.

Williams:  Rob, I know that corporate deals are based on availability of companies and specific opportunities.  Obviously, you’re not thinking about Epocrates as sort of a quick hit and it’s not instantly going to be all merged in with the Athena product line.

How do you see this deal helping Athena evolve its strategy over time and what’s the vision of where it helps you get in five or ten years?

Cosinuke:  We are looking at the strategy in three phases.

Phase one is to try to sidle up to the Epocrates brand and take advantage of some of the high levels of usage and deep love for Epocrates in the form of awareness gains for Athena.  So phase one is sort of sneak up next to it, make ourselves known and be in that love halo.

Phase two is to invest in the core application of Epocrates.  They spent a couple of years going down the road of trying to build their own EMR.  And frankly, they were actually quite successful given the short period of time they worked at it.

I think the disconnect was the expectation that an EMR can be built in just a couple of years.  I think anyone who’s in the EMR space understands it takes longer. We’ve been in an eight-year product life cycle to get it to a point where physicians actually love using it.  And so on that front we’ll go back to the core application, its core benefit, its core functionality, the core use models.

And trust me, Epocrates folks have got a backlog of great ideas of how to enrich that application and add more value to physicians.  So we’ll spend a good part of our next year, or year and a half, just fulfilling those wishes and investing in the core application to make it much better.

We’ll also look at ways in which we can expand its utility.  This includes other types of lookups, other types of research that can be done and possibly adding the other ordering categories as well that provide value to its core reason for being used and loved.

And then finally, in phase three we’ll be beginning to look at integration. Epocrates is really the best used, best loved read-only application.  And we can take that service of information and integrate it deeply into all of the appropriate places within AthenaNet.

You can imagine it sitting right within AthenaClinicals, it can be sitting right within our Coordinator capability and others.

But the reverse is also true.  We like to think of Athena as being the industry’s best read and write application. We’ve got the power of deep stainless steel pipes, incredible interfacing capability, and world-class secure pipes that manage the transactions of health care.

So over time we will look at adding the transaction capability on to the Epocrates platform.  This means looking up an order, placing the order, maybe even going into the medical record as part of receiving an order from a colleague in the space.

There are a myriad of ways in which we could use Epocrates truly integrated into our Coordinator service. We can manage the life cycle of our referral by making a mobile app that’s a content heavy and actually manages transactions between members of the care continuum in a community.

So that’s our approach: in phase one try to get some halo effect from awareness for Athena; phase two, deeply invest in its core application and use model, make physicians love it even more and expand the user base. And phase three is to integrate it into our transaction capabilities on that backbone network.

Williams:  I’ve been speaking today with Rob Cosinuke.  He’s SVP and Chief Marketing Officer at AthenaHealth.  We’ve been talking about the proposed acquisition of Epocrates, what it will do for Athena in the near term and longer term.

Rob, thanks so much for your time today.

Cosinuke:  Thank you.  It’s a real pleasure.

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But these article don’t capture the whole facility fee story. As AIS Health describes, when patients have infusions done in hospital outpatient departments rather than physician offices the reimbursable amount may be double for the same service.  The facility fee can be an important component of that difference. And we’re thousands of dollars per visit here; it’s not peanuts. Yet surprisingly it’s common for health plans to charge coinsurance for the cheaper physician office setting and nothing for the hospital, thus encouraging patients to take the hospital route.

I chuckle when I hear free-market ideologues talk about how unleashing the competitive forces of commercial health plans is going to drive costs down, when it has clearly failed to do so in the commercial market. Actually the folks who are doing something about the facility fee problem (according to the Globe report) are the Medicare Payment Advisory Commission and Massachusetts’ new Health Policy Commission.

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But rather than frame the piece as smokers not being able to afford health insurance, maybe AP should have described it as people not being able to afford to keep smoking. According to the CDC, about 70 percent of smokers want to quit, so perhaps the added financial inducement will succeed where other smoking cessation approaches have failed.

Smokers really do cost health plans more so it’s not as though the rule is without merit. And imagine how happy an ex-smoker will be when s/he saves thousands on health insurance and thousands more by not paying for cigarettes.

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In case you wonder why I criticized the article for being a masked editorial, here’s the lead paragraph:

Millions of smokers could be priced out of health insurance because of tobacco penalties in President Barack Obama’s health care law, according to experts who are just now teasing out the potential impact of a little-noted provision in the massive legislation.

Here’s what’s wrong just with that sentence:

• It’s not President Obama’s health care law. It was passed by both Houses of Congress and signed by Obama.
• Who says experts are “just now teasing out the impact” or that the provision is “little-noted”? This provision is pretty clear and wasn’t hidden.
• And what’s the point of calling the legislation “massive”? It doesn’t contribute anything to the story

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Unfortunately the situation in telehealth is the opposite. The existing regulatory framework is based on in-person consultations where patient and provider are in the same jurisdiction. It didn’t occur to policymakers 50 years ago that broadband communications would allow the “virtual presence” of physicians from afar. Those rules should be changed. Slowly it will happen as pressures build to contain costs and allow new delivery models.

Since legacy rules hamper rather than facilitate the emergence of a useful new technology, perhaps it’s reasonable to look to other mechanisms to nurture telehealth’s growth with financial incentives. Here are a couple of ideas:

• Rather than charging a comparable co-pay for eVisits and in-person visits, payers could charge a lot less or nothing for online visits
• Payers could also pay a premium for physicians and other providers to use telehealth, such that they have a financial incentive to get over the hump

As with e-commerce, this might cost someone something in the early years. But the payoff comes down the road, as telehealth technologies enjoy faster and wider adoption than they would otherwise. It’s a facile comparison, but online visits started around the same time as e-commerce,  yet e-commerce has become mainstream while telehealth remains a novelty.

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