Cartoon – Sign of the Times (Annual Performance Review)
Monthly Archives: June 2021
Cartoon – Urgent Response to Our Productivity Problems
Cartoon – Not Much of a Mission Statement
Cartoon – Our Corporate Planning Group
Cartoon – Fostering a Culture of Innovation
CRISPR Shows Promise in Gene-Editing Therapy During Clinical Trial
Scientists at UCL National Amyloidosis Centre at the Royal Free Hospital, London are hoping their gene editing therapy using CRISPR will be a breakthrough for patients suffering from hereditary transthyretin (ATTR) amyloidosis. In a phase 1 clinical trial, the first six patients have shown positive interim results for gene-editing treatment.
The CRISPR breakthrough comes in treating transthyretin amyloidosis, a mutation in the transthyretin (TTR) gene. Those with this mutation produce an abnormal protein, which gradually builds up in the heart and nerves. Symptoms can include numbness in the hands and feet, loss of control of the bowel and bladder, and loss of mobility.
Hereditary transthyretin amyloidosis gets progressively worse and is fatal. Up until this point, most of the treatment options available to patients have included management of the symptoms and prevention of progression.
Those taking part in the trial have received a molecule knows as CRISPR/Cas9 via one-off infusion. The purpose of this is to deactivate the incorrect gene within the liver cell.
“With the gene no longer active in the liver, it is expected that the patient will only produce negligible levels of the harmful transthyretin protein,” UCL stated in a press release.
Scientists saw in the first six patients a reduced production of the harmful transthyretin protein by up to 96 percent, 28 days after the treatment. Additionally, there were no serious adverse effects witnessed. This data was published in the New England Journal of Medicine.
“As the trial progresses, patients will be given higher doses of the gene editing therapy with the hope that will drive the levels of toxic protein even lower,” UCL explained.
CRISPR/Cas9, a Nobel Prize-winning technology, has been used to edit cells outside the body in the past. However, UCL is presenting the first clinical data which CRISPR/Cas9 is being used as medicine itself for a potential therapy.
“This is wonderful news for patients with this condition. If this trial continues to be successful, the treatment may permit patients who are diagnosed early in the course of the disease to lead completely normal lives without the need for ongoing therapy,” Professor Julian Gillmore, the trial lead, of the UCL National Amyloidosis Centre, part of the UCL Centre for Amyloidosis and Acute Phase Proteins said in a press release.
“Until very recently, the majority of treatments we have been able to offer patients with this condition have had limited success. If this trial continues to go well, it will mean we can offer real hope and the prospect of meaningful clinical improvement to patients who suffer from this condition,” Gillmore continued.
The global trial includes patients from the Royal Free London and a hospital located in Auckland, New Zealand. The investigational therapy, designated NTLA-2001, is being developed by Intellia Therapeutics; a biotechnology company based in the United States.
This could be a big step forward in using CRISPR as gene therapy. Typically, the therapy is injected into the site of illness. However, this newest approach injects CRISPR directly into the bloodstream, which could revolutionize how clinicians treat certain illnesses.
California hospital beats suit over ER fee nondisclosure
A California hospital was properly dismissed from a lawsuit alleging it violated state consumer protection laws by failing to disclose emergency room visit fees before treatment, a state appellate court ruled June 29.
Joshua Yebba filed the lawsuit against AHMC Anaheim (Calif.) Regional Medical Center, alleging the hospital violated California’s Unfair Competition Law and Consumer Legal Remedies Act when it did not disclose a separate fee for an emergency room visit before treating him. Mr. Yebba claimed he would have gone to a different ER if he knew about the fee. He sued on behalf of himself and others who allegedly were charged the separate ER fee without knowing about it.
The lawsuit centered on whether the hospital had a duty to disclose the ER fee to patients before treating them and whether the hospital violated the consumer protection laws by not disclosing them.
The hospital argued that it fulfilled any duty to disclose the fee because it has a written or electronic copy of its chargemaster available. However, Mr. Yebba contended that Anaheim Regional had a duty to tell him personally while checking in or to at least post a sign about the fees in the ER.
A lower court dismissed the case against the hospital on the grounds that Anaheim Regional had no duty to disclose the separate ER fee to Mr. Yebba before treating him and that the allegations didn’t violate the consumer protection acts.
The California Court of Appeals 4th District affirmed the dismissal, saying that California lawmakers have determined what pricing information hospitals must disclose to patients and when, and a court decision increasing the requirements “upsets the legislative balance between the consumers’ right to information and the hospitals’ burden of providing it.”
Read the full court opinion here.
‘It’d be catastrophic’: Dallas-area hospitals could lose $1.1B annually without Medicaid waiver, healthcare group warns
Hospitals in the Dallas-Fort Worth region could collectively lose $1.1 billion in funding each year without a Medicaid waiver extension, a healthcare group warned, according to CBS Local.
The group, Texas Essential Healthcare Partnerships, represents 72 hospitals in the Dallas-Fort Worth region, including those operated by Dallas-based Tenet Healthcare and Houston-based Baylor Scott & White Health.
In April, CMS rescinded approval for a Section 1115 waiver to extend reimbursement to Texas hospitals for uncompensated care through September 2030. President Joe Biden’s CMS said that under the previous administration, CMS and Texas failed to adhere to public comment period requirements in the approval process, so it should be rescinded.
Don Lee, Texas Essential Healthcare Partnerships, told CBS he’s concerned about CMS’ decision to rescind the waiver next year and that hospitals could begin feeling the effects in just three months.
“There’s about $330 million of very important mental healthcare funding for mental healthcare services for the poor that will be lost starting in September of this year,” Mr. Lee told CBS Local.
Texas plans to resubmit its application to extend the 1115 waiver soon, according to the report. However, if the new application is not approved, Mr. Lee said that some hospitals in the North Texas region may be forced to close.
“We believe it’d be catastrophic, not just for the hospitals, but for all Texans,” Mr. Lee told CBS Local.
‘I only see the potential for massive financial loss’: Former Spectrum CFO doubts value of Beaumont merger
Michael Freed, the former CFO of Spectrum Health, said he was “stunned” when he heard that the Grand Rapids, Mich.-based system plans to pursue a merger with Southfield, Mich.-based Beaumont Health, for myriad reasons.
In a June 24 open letter to Spectrum’s board of directors, Mr. Freed said during his tenure they discussed possible mergers routinely and that a Spectrum-Beaumont combination “brought nothing new with it” and wouldn’t enhance value.
“The markets didn’t overlap, so there were no significant administrative savings opportunities. The ability of each hospital to grow wasn’t enhanced by adding the other to the ‘system,'” Mr. Freed wrote. “In short, I never saw how such a merger could improve health, enhance value or make care more affordable. I still don’t.”
Mr. Freed was Spectrum’s CFO from May 1995 to December 2013. During his tenure, he helped oversee the formation of Spectrum and a substantive period of growth for the Michigan system. Mr. Freed also served as CEO of Spectrum’s health plan, Priority Health, from May 2012 until he retired in January 2016.
In his letter, Mr. Freed outlined several reasons he was “stunned” by the pursuit of the merger that would create a health system with 22 hospitals, 305 outpatient centers and about $13 billion in operating revenue.
Mr. Freed wrote that the merger with Beaumont, which is based in Southfield, Mich., may not be in the best interest of West Michigan. He said the combination of the two systems raises questions about whether governance truly will remain in the region and with Spectrum, if financial transparency will continue and if Spectrum will continue to honor the consent decree it signed in 1997 establishing a set of operational guidelines.
If the merger moves forward, “debt can be placed on the books of West Michigan while investments EARNED IN West Michigan could be spent in SE Michigan … and vice versa,” Mr. Freed wrote. “If this entity should someday merge with other out-of-state entities, West Michigan could find itself investing in healthcare in other states as well, rather than in its own health.”
Mr. Freed raised concerns over the agreement between Spectrum and Beaumont to create a 16-person board of directors, seven of whom would come from Spectrum and seven from Beaumont. The CEO would come from Spectrum, and one new board member will be appointed.
“While this structure looks to favor Spectrum Health initially, it would only take the hiring of a board member more favorable to Beaumont Health and the replacement of the CEO (in favor of Beaumont Health) for Spectrum Health to find itself outvoted 9 to 7 on key issues,” Mr. Freed said.
Additionally, Mr. Freed noted that the merger has the potential for massive financial losses to West Michigan. In particular, Mr. Freed said losses would stem from the financial assets of Spectrum and Priority Health no longer residing in West Michigan.
“I’ll admit, I don’t see any value in this merger,” Mr. Freed wrote. “I only see the potential for massive financial loss, both historically and an undetermined amount going forward, to the region that produced all of Spectrum Health.”
Mr. Freed urged the Spectrum board to take a few steps before moving forward with the merger, including selling or divesting Priority Health.
“When you sign the documents that will permanently change this region, your signature will forever hold you accountable for the repercussions,” Mr. Freed wrote. “Please sign carefully.”
Spectrum Health told MiBiz it remains committed to the commitments in the 1997 consent agreement and that it “remains enthusiastic” about the merger.
“Spectrum Health is fully committed to fulfilling its consent decree obligations and will continue to uphold its tenets,” the health system said. “We remain confident that creating a new system not only meets our current obligations to our local communities but will also improve the health of individuals in West Michigan and throughout the state.”
Access the full letter here.
Reducing Administrative Costs in US Health Care: Assessing Single Payer and Its Alternatives
Administrative costs in the US healthcare system are known to be higher than those in any other country, even than other countries with private health insurance systems. There also is widespread agreement the excessive US costs generate little, if any, value, and that they impose a tremendous burden on physicians. With administrative costs even for primary care services approaching $100,000 per year per physician, there is a growing recognition that reducing healthcare-related administrative costs is a policy priority.
Despite the longstanding concerns about these escalating costs, there is little understanding of what generates them and how we can reduce them. To the degree there has been any academic inquiry into administrative costs imposed on US providers, it has compared them to the much lower costs in other countries with nationalized systems. These comparisons are unflattering to the US system and are designed to encourage wholesale healthcare reform.
Our paper published in Health Services Research begins at the retail level, focusing on the specific administrative costs inflicted by our payment system on providers. We examine the complex contractual arrangements between insurers and physicians and measure the efforts that physicians must endure to get paid. It then offers a simulation model to estimate how certain policy reforms would result in nationwide administrative savings.
Currently, each health plan and each physician or physician group (and each hospital) negotiates over a contract for services on a periodic basis. Our analysis examines three separate costs that result from this type of market structure: architectural costs (the enormous number of contracts that are generated annually to provide services to patients), contractual complexity (the difficulty of following all of the requirements of each agreement to receive payment), and compliance costs (the costs of not following the rules in submitting a bill).
Based on this framework, we ask two questions: First, what if physicians entered into simpler contracts with insurers? And second, what if physicians (who accept patients with many kinds of insurance) agreed to a single boilerplate contract with all insurers rather than individualized contracts with each insurer? Put more simply, what if contracts were simpler and standardized?
Our simulation predicts that simplifying contracts would reduce billing costs by nearly 50%, standardizing contracts would reduce those costs by about 30%, and both simplifying and standardizing contracts would reduce those costs by over 60% percent.
We then used the model to estimate administrative cost savings from a single payer “Medicare-for-All” model. Consistent with claims made by advocates for nationalized health insurance, we estimate that a Medicare-for-All plan would reduce administrative costs between 33-53%, largely by standardizing contracts. But these cost savings are less than those generated from standardizing and simplifying contracts within our current system of private health insurance because we modeled that a Medicare-For-All plan would retain Medicare’s complex payment models and have increased compliance costs compared to private payers.
We think this is good news. Though we find that a single-payer system will reduce certain administrative costs, we also find that reforms to our current multi-payer system could generate at least as great a reduction.
There might be benefits to pursuing national health reform, but we can reduce burdensome administrative costs through much simple and less disruptive paths. The even better news from this study is that we can now have a more precise understanding of where administrative costs arise in our health system, and we have the means to evaluate the effects of other kinds of reforms. Understanding is the prerequisite to reforming.
HENRY KOTULA 