MedPAC’s Annual Report II

Continuing yesterday’s commentary, the next area in MedPAC’s annual report was better coordinating the care of people who have both Medicare and Medicaid coverage.   The report notes that while these persons have higher average costs, neither program fully coordinates their care and they often have conflicting objectives, programs and requirements.  There are also subgroups of these beneficiaries, with many having multiple chronic conditions and others in relatively good health.  The biggest need is obviously to focus on better care management for the high-cost group.  MedPAC suggests creating a single payment stream and finding an entity to take financial responsibility for integrating and managing the care of these beneficiaries.

Many of these dual eligibles are part of the group considered in the report’s next section, on use of inpatient psychiatric facilities.  Social security disability recipients are eligible for Medicare and a large subset of these persons are mentally disabled and have frequent inpatient hospitalizations.   The Commission looked at differences in care between free-standing psych hospitals and psychiatric units which were part of a larger hospital.  It also expressed concern about payment adequacy and effect on care.

Shared decision-making is a current theme throughout health reform discussions.  The basic concept is to be sure the patient understands his condition and treatment options and the physician understands the patient’s care preferences, so that the best treatment plan consistent with the patient’s values is arrived at.   Although some Medicare Advantage plans utilize the concept, in general Medicare has done nothing and MedPAC recommends at least a demonstration project, if not providing incentives to providers and/or patients or even requiring use of the practice.  Of course, one problem with many high-cost Medicare beneficiaries is that they are not capable of participating, so a proxy decision-maker may need to be involved.   This section has a very useful background on patient decision aids and other issues in creating effective shared decision-making.

Finally, the report looks at the ongoing issue of self-referral by physicians, a practice which appears to generate potentially unnecessary utilization and health spending.  An exception to self-referral has been established for the provision of services in the physician’s office.  This exception appears to be being significantly abused and MedPAC recommends limiting it.   A primary rationale for the exception, that it allows same day provision of the ancillary services or tests, is undercut by the report’s analysis that shows the services are most often not provided on the same day.   It is hard to understand why there isn’t just  a blanket prohibition on physician ownership of ancillary service facilities.