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2012 Potpourri XVI

By May 5, 2012Commentary

A report put together by the House of Representatives Republican caucus suggests that many US employers will drop insurance coverage in 2014 and send employees to the exchanges.  About 170 million Americans currently have employer-based coverage.  The report is based on survey responses from 71 of the Fortune 100 largest companies.  This group of companies would save $28.6 billion a year  by dropping employer-based health plans and paying the penalty, which is only $2,000.  While the economics are clear, large employers in particular offer health coverage for a variety of reasons and skepticism is appropriate about whether there will be a massive dropping of health plans.  What should be more concerning is that this and other reports show that these large employers believe the law is increasing costs; costs they intend to pass on to employees.  If those costs increase enough, then companies may in fact begin to move people to the exchanges.     (House Report)

A test conducted by the Leapfrog Group, whose mission is to improve quality, at 253 hospitals finds that computerized physician order entry systems can miss many errors.  An earlier test of 210 hospitals had found that more than half of medication orders did not trigger warnings that should have been given and almost one-third of potentially fatal errors did not trigger one.  In the latest test, almost a third of warnings were missed and about 1% of fatal errors.  CPOE is being counted on to help reduce errors in hospitals and other institutions, but several studies have suggested it may cause problems of its own.     (CPOE Article)

Several hospitals are using predictive modeling to try and avert potential readmissions, which will potentially incur significant penalties soon.  Several organizations and vendors are offering these systems, which collect data from EHRs and other sources and attempt to rank a patient’s likelihood of being readmitted.  Daily care managers are notified of the highest risk patients and can take special efforts to prepare them for discharge and to ensure appropriate followup once these patients leave the hospital.  This shows the lengths that hospitals are having to go to in light of the readmissions penalties, but these efforts add expense and at the end-of-the day, the federal program is a zero-sum gain, so some hospitals are going to be penalized no matter what.    (Readmissions Article)

A Perspective in the New England Journal of Medicine discusses issues with the hospital pay-for-performance program, particularly Medicare’s value-based purchasing initiative.  Citing evidence that such programs as currently designed may not improve outcomes, therefore not really deliver value, the authors suggest that while financial incentives may raise performance on what is measured, patients may not actually be getting better care.  They also express concern about the potential effect on hospitals’ overall financial condition, and what that may do to patient care.  One problem in understanding the effect of these programs is that typically hospitals are subject to a wide variety of other initiatives as well, so that understanding how an individual incentive is affecting behavior is not easy.   (NEJM Perspective)

Another pair of New England Journal of Medicine articles examine the readmissions program.   One suggests an alternative approach to that taken by CMS: use of a “warranty” which in essence is an undertaking to be responsible for all costs and care needed for an episode of treatment for a 90-day period of time.  The current CMS program is costly for hospitals and doesn’t provide much reward for success, hospitals could conclude they are better off not making the effort and just taking their lumps.  Under the warranty approach, which is like an episode-based global payment, they have the opportunity for greater financial rewards if they avoid unnecessary care.  It would measure hospitals against their own past performance and be simpler to implement.  The second article summarizes well-known issues with the CMS program.   First, many readmissions are simply not preventable and many vary randomly across hospitals.  In addition, focusing on this program likely detracts from other equally or more important quality efforts.  One change suggested is to lower the window to 7 days or less.  The readmissions program is certain to generate more and more critique as it is implemented.       (NEJM Article)  (NEJM Article)


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