Catching up on a couple of issues of a leading health research journal, woke though it may be. For reasons that are known only to CMS and Congress, i.e., lots of lobbying and campaign contributions from hospitals, for the exact same service, sometimes by the same physician, Medicare pays hospitals more if the service is done at a hospital outpatient setting as opposed to a doctor’s office. This obviously costs Medicare more. And since hospital systems own lots of the doctor practices now, they are pretty much forced to use the more expensive setting. Congress passed a minor exception and paying the lower amount for new hospital outpatient departments, but of course there aren’t really new hospitals being built. In any event an article in Health Affairs finds that this exception affected only a very, very small number of services and did nothing to reduce spending. The obvious solution, to everyone but politicians getting contributions, is to always pay the smaller amount. And to force hospitals to divest all physician practices. Given the crisis in federal spending and Medicare solvency, there is no reason not to do so immediately.
A separate study examined the cost in regard to cancer treatment and found that at least one billion dollars over three years could be saved by lowering hospital payments to those in doctors’ offices and that greater use of biosimilars could also create substantial savings. I should note that the higher payments typically mean higher copays for beneficiaries as well.
Another study discusses disenrollment from Medicare Advantage among beneficiaries in poor health. It purports to find that changes are due to difficulty accessing care but the truth is that there are very few switches and those that occur are actually usually because people want to insist on getting care they don’t need and that is inappropriate and they can do that in fee-for-service Medicare.
Claim denials in Medicare Advantage were looked at. About 17% of the dollar value of claims were initially denied, but about 60% of the was reversed on resubmission. Please note that many denials are very valid reasons, such as uncovered or inappropriate services and excessive coding. The study did not examine the reasons for the denials. I am just going to say that most of these denials could be avoided by providers not using coding software that upcodes everything and is aimed at maximizing revenue.
Value-based purchasing was supposed to be the hot new way to get control of medical spending. It ties at least some payment amounts to outcomes measures. Medicare implemented a bunch of them, which have basically done nothing. A study examined the one for skilled nursing facilities which was supposed to reduce hospital readmissions and deaths. It made no difference and no difference in length of stay or other measures either. So either providers don’t care and they were doing a pretty good job even without the program. Meanwhile they have to spend a lot of time and money complying with the VBP requirements.
On the other hand, research concludes that paying doctors to manage care transitions, like from a hospital to home, can improve outcomes. And that’s it for this issue. (HA Table of Contents)
