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New Healthcare Ideas

Stop the presses batman, healthcare costs in the United State’s are the highest in the world but we are not getting the best for these high costs. According to an April 19, 2017 Idaho Medical Care Advisory Committee report, costs are 248% more per person in our country than anywhere else. However, life expectancy, infant mortality, and the percent of our population with two or more chronic conditions (aged 65 and older) are last when we look at outcomes based metrics. This report argues that how we pay for care is part of the problem. Is this true?


The rise of paternalistic medicine can be directly attributed to the payment methodology called Fee-for-Service payments. This payment type encourages medical volume and complexity. Fee-for-Service payments don’t change based on a providers effectiveness or quality. There is almost no incentive to improve a patients quality of life. Physicians and providers make the spending decisions but have little to no reason to manage costs. 


According to any Economics 101 class, markets work best with many buyers and sellers, symmetry of information (everyone included in the market has equal knowledge), and data is transparent for quality and cost (Down with data paywalls). This type of thinking matches perfectly with the idea of paternalistic medicine. Our primary care providers are “sellers” of a better quality of life. We, patients, are buyers of a better quality of life. Providers sell symmetry of information, diagnoses which puts us (patients) on a equal knowledge base as the healthcare system. We “trust” doctors and the system to provide transparency once we pay our deductible or copay so we can receive the best care possible in the healthcare market. Economics 101. 


Market economies are what we know in the United States, we know and understand fee-for-service. Those of us that have huge houses, amazing cars, the latest MacBook Pro’s, the newest and latest IPhone’s love our fee-for-service market economy. It’s what we know and feel comfort in as we float through life avoiding pain and seeking pressure. Surprisingly, those of us in the without category still feel comfortable in our current market economies. We dream of bigger houses, larger paychecks, access to the latest and bestest electronics, and living amazing lives like those of us in the “have” category. We (the collective we) understand and accept that if we work just a little bit harder, learn a little bit more, combined with a little bit of luck will land us with riches beyond our dreams. The next, better fee-for-service market is always right in front of us for the taking. That is the wonder of our market based economy.


After the last Wall Street burst bubble, there is a new theory developing that our market based economy is broken or flawed. That it only rewards with the gold already, that there is no movement between the haves and have nots. For the purpose of this post, I am going to steer away from this debate for this time being. Don’t worry though, I will return to this new economy theory because I believe it fits better with a patient centered design methodology. It is time to develop an economy based on human centered needs, not market based needs. There is a difference. 


Back to our market based healthcare system. Lets continue our discussion about payment reform but throw in some politics for added difficulty. First, we have to enter into a political discussion because Medicare and Medicaid are funded based on politics (spending on healthcare increased to $3.2 trillion (CNN Money), money and politics go together like doughnuts and coffee). Money also equals power which means $3.2 TRILLION is more power than most will know what to do with, winning elections in order to enjoy said power becomes more important than working towards the collective good. 


For easy of this post, lets create a political spectrum. A good conservative believes in a government that governs least governs best. They will error on the side of business which means less or no regulation, markets regulate themselves according to this theory. If they have to spend, tax cuts for business and the rich are preferred - the President Regan idea of trickle down. A good liberal believes in a government has the ability to govern efficiently for all. Government is there to ensure that everyone is protected, for example they will create environmental regulations in order to prevent an increase in childhood cancer rates. Liberals are more open to new ideas like gay marriage or increasing funding for kindergarten through 12 grade. Liberals also believe in the idea that markets generally regulate themselves but understand that a profit motive can lead to greed, corruption, and morally and financially poor decision making. Government needs to create boundaries in order to prevent such abuses when a market fails.


Idaho, is going to fall on the conservative side of our spectrum. Many of Idaho’s most conservative leaders think an increase in one new employee at Medicaid would mean government is getting to “big” and therefore hurting the economy. That said, government spending in the healthcare market hurts “them” worse politically which is the motivation to create a new Regional Care Organization in the hopes of cutting costs. 


Since Idaho falls on the conservative spectrum, any and all programs created are going to be provider-based programs. If we can give the sellers on our healthcare market based economy (providers) more access to tools and competition, costs should go down. It’s roughly equivalent to the government sending more of its citizens to college because a better educated workforce will draw higher paying jobs and opportunities. A provider with more tools (EHR’s, eCQM’s, MU) gains better transparency on their performance (similar to a more educated workforce) and thus will be able to provide a higher quality of product (similar to a educated workforce attracting higher paid jobs). 


In 2018, Idaho Medicaid is planning on expanding its Health Connections Regional Care (RCO or Regional Care Organization) program. This program is designed for physicians, hospitals, and other partners who want to form a cooperative structure within their geographic region to accept accountability, and transform care. While participation within this program is strictly voluntary, physicians, hospitals and other providers within a region will need to collaborate on the submission of a single RCO proposal for their particular geographic region.  


Health Connections Regional Care orgs will establish local governance and Community Advisory Groups, and in turn, contract with Idaho Medicaid on behalf of their care-delivery network. Patient membership within the RCO will include those Medicaid participants who select a primary-care provider who participates with the RCO. Medicaid patient volumes will grow as RCOs recruit primary- care practices to their organization. Collaboration within the provider and hospital community will be essential.


Through the RCO program, shared-savings payments will be available for the control of healthcare costs to include primary care, specialty care, hospital, imaging, surgical facility, and other services for attributed Medicaid beneficiaries. Idaho Medicaid will administer shared-savings programs directly with the RCO who will distribute payments among their members following previously approved criteria.


Health Connections Regional Care organizations will be receiving what are now called Retrospective Payments. This means that the amount paid is determined by (or based on) what the provider charged or said it cost to provide the service after tests or services have been rendered to patients. In this case, Idaho Medicaid will define the measures, the reporting, the targets, and the payments in the contract. I mention this because it is important to remember all state based Medicaid’s, and especially Idaho’s because of its conservative nature, must operate as faithful stewards of taxpayers money. Unfortunately, taxpayer wishes and patient needs do not always align for the greater good. 


RCO’s in Idaho will help establish Community Advisory Groups called Community Health Outcome Improvement Coalitions (CHOICe). Their function will be to advise each Health Connections Regional Care organization. Members of this group will include representative stakeholders and leaders within the community that hold a common interest in improving health and wellness, creating health equity, and addressing the social determinants of health in their communities. For e-patient leaders in conservative states, this will probably be the easiest community to join in order to advance the virtues of patient centered care. Establishing contacts, regardless of political party, with local leaders just got more important. RCO’s will be operating from a business perspective which many on the conservative spectrum will mean no patient advocacy needed. That leaves these community advisory groups as our only way to get our voices heard. 


So why the long post? As a so called e-patient advocate, I’m not thrilled with this Health Connections Regional Care Organization idea. Medicaid’s are not health insurance, they are there it reimburse providers, hospitals, etc for their costs not to exceed what Medicare pays. Usually this is done on an annual basis through complicated government accounting and Medicare cost reports. Idaho has taken this idea and created a new system where Idaho primary care providers can get real time cost reports based on performance measures instead of complicated accounting measures. I simply don’t understand how this will benefit patients because cost settlement process are notorious for being one of the poorest ways to control costs. Its only paternalistic theory wrapped in the pretty wrapping paper of patient centered care. 


That said, something needs to change. Maybe retrospective payments through the mechanism of a regional care organization will continue the conversation to an actual patient centered care. A $3.3 TRILLION system is not going to change overnight, that is a tremendous amount of bloat to move. It is also well established that a well educated population does attract better paying jobs and opportunities for its citizens. Maybe a better tooled and motivated primary care physician will create better health for its citizens. Lets hope so. 


One final thought. We need e-patients in politics now! I don’t necessarily mean in governorships or as President. A deputy director, who is a chronic patient, tasked with reforming healthcare in their state helps everyone. A chief a staff of a local Senator or Representative gives access to e-patient advocates who can then come share their story. Just a thought!


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Alan Brewington