Tag Archives: Accountable Care Organizations

How do we prevent denial of available and deserved therapeutic options to patients?

I read this excellent post The Irrational Rationing of Health Care on LinkedIn by David Katz, that documents a case of denial of a treatment option to a patient because the payer considers that ‘not established as standard therapy for that cancer’ – as documented in their business criteria. As you would have guessed that the treatment option is a reasonably expensive one. This is an excellent article and an exemplary case for what I elaborate in previous blogs http://bit.ly/ACOSteadyState and http://bit.ly/sustainablehealthcare .

PPPR

 

Yes, the advances in available treatment options puts heavy burden on payers – and most of the time payers are ruthless and act against the purpose of their existence. This puts anguish and many times irreparable damage to patients and heavy burden on sympathetic physicians. We, and they (payers), have to accelerate the newer options that are available for them (as never before in the existence of that industry) to recover costs in other ways available to improving efficiency and margins. My guess is the motivation for such actions are a combination of: (i) payers are behind in effective adoption of options in other fronts for cost control with new advances – so they see newer treatment options only as a cost burden, (ii) those cost containment options take time to pay back, and treatment options are evolving faster and (iii) payers are greedy to reap the benefits by trying to maximize as much margin till an effective law or regulation is imposed on them to stop this business practice. Let us hope they do not make it a practice to be fair only when regulated strongly – which is not good for them. Often payers end up spending more money cumulatively by trying to deny something that seems to be expensive care option at the current point in time, or sadly let the patient die.

As a society, the onus is on us to both help the payers as well as regulate them, but keeping their capitalistic needs in perspective. The recent and rapid developments in healthcare market have left too many loopholes that payers as well as many care practices (physician offices, hospitals, etc.) exploit to squeeze out more from the system.

As I wrote in an earlier blog http://bit.ly/ACOSteadyState, “To avoid such a scenario, the system: patients, physicians (and other care providers), payers and regulators have to simultaneously achieve their goals of patient care and cost control while balancing everyone’s financial incentives – without burden on one of the players in the equation.” Who is going to take up this responsibility? Only a healthy dialog and thought leadership involving all players will reveal the answer for that – we need to get there rapidly to avoid heavy burden of course correction.

Finally, this also reminds me to reach out to an experienced and knowledgeable physician who said in a recent meeting, that ‘when treatment options are available, the single determining factor if the patient has access to it is if they have access to physicians‘. Will update when I get a chance to discuss, or even ask if he is willing to write a post on that.

So, how do we get care to ‘medically deserving’ (definition needed) patients to whom therapeutic options are available even if they are classified exploratory/experimental by payers – under current rules or loopholes – with the evolving healthcare market?  Share what you think using the comment option.

Picture based on a reflection captured from subway window in Zurich. It is modified and used to show four major facets in healthcare: Patients, Providers (of healthcare), Payers and Regulators.

A steady state to avoid while adopting Accountable Care Organizations (ACOs) in healthcare

Healthcare is undergoing a major overhaul. The costs are ballooning and we are resorting to Electronic Health Records (EHRs) and Electronic Medical Records (EMRs), remote monitoring and care, quantified-self enabled by smartphones, wearable devices, etc. to gain better understanding of cost control and sources of wasted resources. This post refers specifically to changes happening in the USA.

PPPR

With the implementation of the Affordable Care Act (ACA), another major change that will likely be the norm in the near future are ACOs – Accountable Care Organizations , also called pay-for-performance (P4P) in broader contexts. I will use ACO and P4P interchangeably for this post. In this concept the care providers (hospitals, doctors etc.) are reimbursed mainly by metrics signifying quality, appropriateness and efficiency of the health care provided. This contrasts from the current standard where the providers are predominantly paid for each service provided including the number of tests they order during the course of their treatment.

The healthcare industry, while built on compassion and care, still has to control and recover costs and have an operating margin. One major (and welcome) change that is expected with adoption of ACOs is that practitioners of various sub-specialties interact more freely.

Of all the good things that can happen with this change to ACOs, one possible outcome worries me. In this worrisome scenario, the hospitals and care organizations train their staff to achieve the above goal with as much margin as possible and over time reach a steady state that is optimized primarily for the margin, while patient care gets adversely affected. Let us consider the scenario where the patient falls in a socio-economic or other stratification category, or has disease that is not easy to visualize and diagnose – then a couple of physicians independently doubting the patient in their notes can lead to the system claiming that they have provided adequate care and meet the payment criteria, while optimizing the care cost. This patient is unlikely to receive optimal care.

Another example (probably also related to the above) is the 30 day readmission rate as a criterion for evaluation of performance: in this context there will be a strong tendency to compromise patient care if the patient returns for care on day 27, for instance. With all due respect for compassion and care of medical professionals, the need to optimize margin might force them to make decisions that are not optimal care for that day. One evolving trend is highlighted in this article.

To avoid such a scenario, the system: patients, physicians (and other care providers), payers and regulators have to simultaneously achieve their goals of patient care and cost control while balancing everyone’s financial incentives – without burden on one of the players in the equation.

Let us avoid a steady state that compromises patient care while adopting an honorable goal that could forever transform our healthcare system and costs.

Share what you think using the comment option.

Picture based on a reflection captured from subway window in Zurich. It is modified and used to show four major facets in healthcare: Patients, Providers (of healthcare), Payers and Regulators.