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June 15, 2012 at 08:11 AM
Everyone wants to put the consumer in charge of lowering health care spending.
That raises a question: If the current fee-for-service (FFS) physician reimbursement system is so dysfunctional that the Centers for Medicare & Medicaid Services (CMS) has a hard time making the system work for Medicare, how do we create a reimbursement system that gives consumers a fighting chance?
Today, consumers can barely find out after they’ve had an office visit what kind of care the office thinks it has provided, let alone what the care will cost in total, or what the patient will pay for care out-of-pocket.
Going to a hospital and trying to figure out what the charge might be for a relatively simple bundle of acute care — say, for example, fixing a child’s broken arm — is like trying to get a rain cloud to explain the mechanics of how water rises up into the sky and then comes back down. The cloud just does its thing without talking about it, and a hospital at least pretends to follow a similar approach.
The Senate Finance Committee organized a hearing last week on Medicare physician payment policy, to get ideas from private insurers on how CMS could fix the traditional Medicare fee-for-service (FFS) payment system.
Peter Edwards of Humana Inc., Louisville, Ky. (NYSE:HUM), talked, for example, about trying a system similar to an accountable care organization (ACO).
The ACO-like program focused on integrating care delivery, measuring performance, and paying doctors for helping to improve outcomes and control costs.
The program lowered the number of inpatient hospital days per 1,000 patients by 29%, and it lowered the number of emergency room visits per 1,000 patients by 46%, Edwards said. The program also increased the percentage of hospitalized patients who saw a physician within 7 days of discharge by about 15% and the percentage of people with diabetes who’d had the recommended A1c test by 6.1%.
Similarly, Lonny Reisman of Aetna Inc., Hartford (NYSE:AET), said his company found an incentive program helped decrease the pilot-program patient acute hospital admission rate by 45% when compared with the rate for control-group patients.
Then, as I was reading this, a couple of weeks after I’d surrendered and dropped out of my own employer’s generous, well-designed HSA program, it hit me: Most people with high-deductible health insurance and health savings accounts (HSAs) can’t start ACOs.
Aside from the fact HSA holders don’t have consultants, and usually don’t know what an ACO is, it’s hard for them (until recently: for me) to actually get the doctor’s billing person on the line, let alone hold a conversation with that individual.
