Author Archives: henrykotula

What Have We Learned About Bundling Medical Conditions?

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As an alternative payment model, bundled payments hold the potential to improve the value of care by holding clinicians and organizations accountable for episode-specific quality and costs. Medicare has scaled bundled payments nationwide via several programs that define episodes based on hospitalization and up to 90 days of post-acute care.

However, the impact of bundled payments appears to differ between surgical and medical episodes. On one hand, Medicare has achieved promising results from bundling surgical care for lower extremity joint replacement. Medicare’s evaluation of its largest national bundled payment program, the Bundled Payments for Care Improvement (BPCI) initiative, has demonstrated that participation in joint replacement bundles is associated with a 3.8 percent decrease in per-episode spending with stable-to-improved quality. Other work evaluating the experience of high performers in BPCI demonstrates that bundled payments may reduce the costs of joint replacement episodes by up to 20 percent, with sizeable bonuses to physicians and hospitals and small improvements in quality – outcomes that, if scalable, would represent a win for patients, clinicians, organizations, and Medicare alike. On the other hand, recent evidence corroborates analyses conducted by Medicare and its contractor, suggesting that as designed, bundles for medical conditions such as congestive heart failure (CHF) and chronic obstructive pulmonary disease (COPD) are not associated with significant changes in quality or Medicare spending.

Therefore, one critical aspect of understanding the impact of bundled payments is evaluating how and why it differs for surgical versus medical care. This insight is particularly important given that surgical and medical episodes will be further expanded at a national scale in the forthcoming Bundled Payments for Care Improvement Advanced (BPCI-Advanced) program. In this post, we describe why the lack of episode savings in Medicare’s medical bundles may not be unexpected, why policymakers should not abandon medical bundles, and why existing evidence poses three important policy implications for the future of medical bundles.

Why Results May Differ For Surgical Versus Medical Bundles

By designing bundles that span hospitalization and post-acute care, Medicare has emphasized reductions in post-acute utilization and spending as major financial savings opportunities. While this approach suits surgical care in which a procedure triggers a cascade of acute and post-acute care, it may pose several challenges for episodes related to medical conditions. First, spending patterns for surgical versus medical care differ, more predictably spiking after surgical procedures but adopting a more cyclical pattern for chronic medical conditions. Accordingly, hospitalization may be more appropriate as an episode trigger for surgical episodes than for medical ones.

In surgical care such as joint replacement, hospitalization is a clear, distinct trigger before which there would be no expected episode-related utilization (e.g., little to no joint replacement-associated services prior to the surgery) and after which there is a distinct cascade of related utilization (e.g., physical rehabilitation, wound care, and post-surgical follow-up). In contrast, hospitalization only represents one aspect and phase of management for medical conditions such as CHF and COPD, which span outpatient, inpatient, emergency department, and post-acute settings over longer periods.

Second, physicians’ and hospitals’ ability to impact post-acute care utilization and spending may differ between surgical and medical episodes. This difference is not simply a reflection of the proportion of total episode spending paid to institutional post-acute care providers. For example, spending on skilled nursing facilities and inpatient rehabilitation facilities was only marginally higher for joint replacement compared with five medical conditions (26 versus 24 percent, respectively).

Rather, differences in the ability to impact post-acute care utilization may relate to the types of services provided in institutional post-acute settings for surgical versus medical patients. For surgical episodes, care at skilled nursing facilities often involves discrete, time-limited activities such as physical rehabilitation to achieve post-surgical recovery (e.g., strengthening, functional improvement). In contrast, given the natural history of diseases such as CHF and COPD, institutional post-acute care services for medical patients generally involve complex tasks such as medication management(e.g., diuretics) and multifaceted occupational therapy to promote self-care and activities of daily living. Consequently, hospitals in surgical bundles have achieved savings without compromising quality by shifting discharges from skilled nursing facilities and inpatient rehabilitation facilities towards home, with either home health or self-care. However, it remains unclear if similar efforts are possible or appropriate for the types of post-acute care that are often required as part of medical bundles. In turn, discharge patterns in medical bundles may reflect the less predictably defined roles of institutional post-acute care providers.

Another reason that shifting discharges away from institutional post-acute care providers may prove challenging under medical bundles is that they involve different types of patients than those often involved in surgical bundles. As noted recently, patients in medical bundles tend to be older and at higher risk for poverty and disability than patients in joint replacement bundles. In turn, patients receiving care for medical conditions may have greater clinical needs during and after hospitalization than patients undergoing surgical procedures.

Implications For The Design Of Medical Bundles

Collectively, these dynamics offer insight into why clinicians bundling care for medical conditions have not achieved savings in BPCI. They also have implications for the design of medical bundles going forward.

First, Medicare could consider modifying when and how medical episodes begin. Rather than being a necessary pre-condition for an episode, hospitalization itself may be a modifiable element of variation in medical conditions. Consequently, unlike in surgical procedures, using hospitalization as a medical episode trigger may miss the opportunity to include cost and utilization variation across the care continuum. As an alternative, if medical episodes were triggered in the outpatient setting – for example, after two specialty office visits within one month — provides might be better able to coordinate medical bundles with other efforts to improve value (e.g., payment models such as accountable care organizations and policies such as the Hospital Readmissions Reduction Program).

Second, Medicare could design medical bundles so that the emphasis on improvement is not restricted to care delivered in the post-discharge period. While variation reduction is not an absolute requisite for performance in bundled payments, care standardization remains an important organizational strategy for improving episode-based care. Creating incentives to focus on outpatient and pre-discharge elements may be particularly fruitful for medical bundles given the complexities of ongoing (in the ambulatory setting) and acute (in the hospital setting) management, and the possibility that practice redesign may require more time and greater effort than in surgical episodes.

Third, more data are needed to understand the impact of medical bundles and how best to design them in the future. To date, we have only early evidence about the impact of medical bundles in BPCI (the mean number of months of BPCI participation was 7 months for these hospitals). Given that other alternative payment models such as accountable care organizations have required three or more years before participants achieved savings, medical bundled payment policy should be guided by longer-term evaluations. Such evaluations should also closely monitor the programs for unintended effects: while it may be reassuring that medical bundles have not appeared to inadvertently lead to more readmissions or emergency department visits, vigilance is nonetheless required given the history of racial disparities in access that stem from quality- and value-based policies. Finally, future work can speed progress towards improvement by providing more detailed descriptions of the utilization and spending patterns of patients involved in medical bundles, as well as highlighting the experiences of high-performing providers.

Looking Ahead

While existing evidence suggests that medical bundles may not improve the value of care, these findings are not necessarily unexpected, and policymakers should not abandon the effort to bundle the care of medical conditions. Instead, in addition to more long-term evaluations, the design of medical bundles may be improved in the future by modifying how they are triggered and which phases of care they capture.

 

Senators Consider Dueling Bills Over Texas Individual Mandate Litigation

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Litigation in Texas over the constitutionality of the individual mandate and, with it, the entire Affordable Care Act (ACA) is receiving more and more attention in Congress. On August 23, 2018, Republican Senators released new legislation that they believe would help blunt the impact of a ruling for the plaintiffs in Texas v. United States. The stated aim of the bill is to “guarantee” equal access to health care coverage regardless of health status or preexisting conditions. However, in the event that the court agrees with the plaintiffs—or even just the Trump administration—the legislation leaves significant gaps.

At the same time, Democratic Senators had their efforts to potentially intervene in the litigation rebuffed during the debate over a recent appropriations bill for the Departments of Labor, Health and Human Services (HHS), Education, and Defense. With a hearing on Texas scheduled for September 5, 2018—the same time as hearings are set to begin in Congress over the confirmation of D.C. Circuit Judge Brett Kavanaugh to the Supreme Court—attention on the case is only likely to increase.

Brief Background On Texas

In Texas, 20 Republican state attorneys general and two individual plaintiffs challenge the constitutionality of the individual mandate, which was zeroed out by Congress beginning in 2019. Without the penalty, the plaintiffs argue that the mandate is unconstitutional. Because the mandate cannot be severed from the rest of the law, they believe the entire ACA should also be struck down.

In June, the Department of Justice (DOJ) declined to defend the constitutionality of the individual mandate alongside the ACA’s provisions on guaranteed issue (42 U.S.C. §§ 300gg-1, 300gg-4(a)), community rating (42 U.S.C. §§ 300gg(a)(1), 300gg-4(b)), and the ban on preexisting condition exclusions and discrimination based on health status (42 U.S.C. § 300gg-3). These provisions collectively ensure that individuals with preexisting conditions cannot be charged more for their coverage or denied coverage or benefits based on health status or other factors.

The plaintiffs have asked Judge Reed O’Connor of the federal district court in the Northern District of Texas to enjoin HHS and the Internal Revenue Service (IRS) from enforcing the ACA and its implementing regulations—or, at a minimum, to strike down the law’s guaranteed issue and community rating provisions alongside the mandate. Judge O’Connor is considering ruling on the merits of the case (instead of issuing a preliminary injunction) and has scheduled a hearing on the motion for a preliminary injunction for September 5.

As noted above, the hearing will coincide with confirmation hearings for Judge Kavanaugh. Texas will likely be a focal point in the Kavanaugh proceedings because of the possibility that the case will reach the Supreme Court and because previous decisions suggest that Judge Kavanaugh believes that a President can decline to enforce laws that he or she believes to be unconstitutional.

The New Republican Legislation

Recognizing the potential impact of the Texas lawsuit, 10 Republican Senators released new legislation on August 23. The bill is sponsored by Senators Thom Tillis (NC), Lamar Alexander (TN), Chuck Grassley (IA), Dean Heller (NV), Bill Cassidy (LA), Lisa Murkowski (AK), Joni Ernst (IA), Lindsey Graham (SC), John Barrasso (WY), and Roger Wicker (MS). It is tied directly to the Texas litigation: Press releases acknowledge the September 5 hearing and state that “protections for patients with pre-existing conditions could be eliminated” if Judge O’Connor rules in favor of the plaintiffs.

The legislation would amend the Health Insurance Portability and Accountability Act of 1996 (HIPAA). Although HIPAA offered significant new protections at the time it was passed, these protections were limited in terms of ensuring that people with preexisting conditions could access affordable, comprehensive coverage, particularly in the individual market. HIPAA established a minimum set of federal protections for certain consumers—for example, those who lost their group coverage—facing certain situations, such as job lock because of a new preexisting condition exclusion period. HIPAA also required guaranteed issue in the small group market and guaranteed renewability in the individual and group markets.

As mentioned, the DOJ has declined to defend the ACA’s provisions on guaranteed issue (42 U.S.C. §§ 300gg-1, 300gg-4(a)) and community rating (42 U.S.C. §§ 300gg(a)(1), 300gg-4(b)), and the ban on preexisting condition exclusions and discrimination based on health status (42 U.S.C. § 300gg-3). Thus, their position in the lawsuit implicates parts of four provisions of federal law: 42 U.S.C. §§ 300gg, 300gg-1, 300gg-3, and 300gg-4.

The legislation introduced by Republican Senators would restore only two of the four provisions that stand to be invalidated in Texas: 42 U.S.C. § 300gg-1 (guaranteed issue) and most of § 300gg-4 (guaranteed issue and rating based on health status). So the bill would prohibit the denial of coverage and rating based on health status, but it would not prohibit preexisting condition exclusions or rating based on other factors, such as age, gender, tobacco use, or occupation. This means that many individuals, including those with preexisting conditions, could still face higher premiums, higher out-of-pocket costs, and the denial of benefits because of a preexisting condition even after paying premiums for many months.

Implications 

The protections offered by the restoration of the two provisions included in the Senate GOP bill, § 300gg-1 and most of § 300gg-4, are largely illusory without the other parts of the ACA—community rating and the ban on preexisting condition exclusions—that are at risk in the lawsuit. Assuming the at-risk provisions are struck down and the new legislation is adopted, consumers would still face significant gaps. For instance, a woman with a history of cancer could purchase a policy under the new bill, but she could be charged more based on her gender and age, potentially pricing her out of the market. In addition, her policy could have a preexisting condition exclusion, meaning that any recurrence of cancer—or any other health condition—might not be covered at all; this could lead to much higher out-of-pocket costs and far less financial protection.

If Congress were to enact this bill today, it would largely be duplicative of existing law (and would do nothing to disturb the ACA). If Congress were to enact this bill in response to the Texas litigation, its effect would depend on how (if at all) a court would invalidate the ACA provisions in Texas. Would a court strike the entire provisions, including what was adopted under HIPAA and other federal laws? Or would a court simply strike the amendments that were made by the ACA?

If the latter, the new legislation might do even less than its authors think, because much of the bill is, in fact, devoted to readopting existing federal law that may not be at issue in Texas. These provisions were adopted before the ACA and touch on, for instance, genetic information nondiscrimination and long-standing exceptions to guaranteed issue.

No Vote On Manchin Resolution To Potentially Intervene In Texas

In July, Democratic Senators led by Joe Manchin (WV) introduced a resolution with the goal of intervening in Texas to defend the ACA’s protections for people with preexisting conditions. The resolution would authorize the Senate Legal Counsel to move to intervene in the case on behalf of the Senate and defend the ACA. During last week’s debate over an HHS appropriations bill, Senate leadership blocked a vote on the amendment.

 

 

THE MOST IMPORTANT PERSON IN YOUR ORGANIZATION

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The Most Important Person in Your Organization

It’s natural to think of yourself as the most important person in the world. You think your own thoughts. You have your own perspective. You seek your own enjoyment. You dream your own dreams.

The pain of realizing the world doesn’t revolve around you blocks the light from shining through.

Who is the most important person in your organization? I don’t know. But I know it isn’t you.

Deception:

The belief that you are the center of the universe is a great deception that prevents you from reaching your potential as a leader.

It’s a small universe if you are its center.

Would you want to play in a symphony where the musicians ignored each other and followed their inner voice? What happens when symphonies ignore each other and turn a blind eye to the conductor?

Symphony becomes cacophony when each member does their own thing.

You become bigger when you give yourself to something bigger than yourself.

Others make you matter:

In its simplest form, a leader is a person with followers. In other words, leadership REQUIRES others.

Without others, you aren’t a leader.

How you view others determines the nature of your leadership.

Enough ego:

You need enough ego to want to make a difference, but not so much that life is all about you. David Letterman’s service to Habitat for Humanity illustrates the point.

“When you help others, you feel better about yourself. ” David Letterman

The search to feel better about himself led him to serve others. That’s healthy ego. Unhealthy ego serves only itself.

Another center:

Barack Obama spoke the following words at Senator John McCain’s memorial service.

“By his own account, John was a rebellious young man. In his case, that’s understandable, what faster way to distinguish yourself when you’re the son and grandson of admirals than to mutiny. Eventually, though, he concluded that the only way to really make his mark on the world is to commit to something bigger than yourself.” (September 1, 2018.)

What does it mean to live for something bigger than yourself? It means you are no longer the center.

Your most frightening and fulfilling power is placing something other than yourself at the center of your life.

Leaders who live for themselves live small disappointing lives.

7 ‘bigger than yourself’ practices:

  1. Visualize putting your team at the center of your focus for one day. Keep pushing yourself off center stage and shining the light on others.
  2. Get excited about things others are doing.
  3. Talk less about yourself and more about others.
  4. Ask people to share their perspective. “What do you think?”
  5. Notice your judgement of others. Are you typically negative? This suggests you think too highly of yourself.
  6. Stand up for your convictions with grace. Putting others at the center isn’t being a pushover.
  7. Determine if your actions matter. “Will this matter next week, next month, next year?”

When leaders lives for something bigger than themselves, what are they like?

 

 

‘Death Certificate Project’ Terrifies California Doctors

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Hundreds threatened with disciplinary action for opioid scripts to patients who overdosed.

Brian Lenzkes, MD, got a letter last December from the Medical Board of California that left him shocked and scared.

The licensing agency told him it had received a “complaint filed against you” regarding a patient who died of a prescription overdose in May 2013 — four and a half years earlier.

In stern bold type, the letter’s second paragraph said the man “died from an overdose of hydrocodone, oxycodone, and zolpidem.” The state’s prescription drug database, CURES(California Controlled Substance Utilization Review and Evaluation System), showed that “Dr. Brian J. Lenzkes had been prescribing long-term excessive amounts of these, including benzos,” and that “it is unknown what conditions the patient suffered from which required such medication.”

The San Diego internist told MedPage Today he’d tried since 2006 to help this complex patient manage pain related to his many problems — so severe they at one point caused him to be admitted to hospice – including diabetic ulcers, congestive heart failure, severe neuropathy, bone infections, and a below-knee amputation, to name a few, he said.

He’d tapered dosages, changed drugs, and tried many other approaches. Though the patient was challenging, he’d “experienced a strong bond” with him, and “he would often bring me homemade barbecue sauce as a thank-you.”

He knew of no complaints about his care of this man. Lenzkes said the patient’s friend told him the man “would have died years earlier if it were not for my encouragement and support.”

If the medical board was after his license, well, the term “witch hunt” crossed Lenzkes’ mind. “I don’t prescribe inappropriately,” he said.

In fact, no patient or family member had filed a complaint against him.

Hundreds threatened

Rather, Lenzkes is one of hundreds of California physicians caught up so far in the medical board’s aggressive “Death Certificate Project,” a program that attempts to stop the epidemic of accidental deaths from prescription opioid overdoses.

The California project takes death certificates in which prescription opioids are listed as a cause, then matches each with the provider — sometimes more than one — who prescribed any controlled substance to that patient within 3 years of death, regardless of whether the particular drug caused the death or whether that doctor prescribed the lethal dose.

At the project’s launch in late 2015, board staff began reviewing 2,694 certificates of death filed in 2012 and 2013 and found 2,256 matches in CURES, showing each provider who wrote an opioid prescription filled by those deceased patients.

Those reports went to medical peer reviewers who, after extensive review, selected 522 prescribers as warranting an investigation of the patients’ files. They included including 450 allopathic physicians against whom the board has opened formal complaints along with 12 osteopathic physicians and 60 nurse practitioners or physician assistants, who were referred to their respective licensing boards. Of the 12 osteopath referrals, seven were closed for insufficient evidence; the other five remain open for investigation.

Of the nearly 450 MDs like Lenzkes who received letters notifying them of a “complaint,” the state Attorney General has filed opioid-related prescribing accusations against nine physicians, Kirchmeyer said. Four of those nine already faced possible disciplinary action on unrelated charges, and saw their accusations amended with new charges regarding opioid prescribing.

For one physician, the accusation referenced deaths of three patients under his care.

The board said 216 cases involving those 450 MDs have now been closed for insufficient evidence or no violation, or the license had already been revoked or surrendered, or the physician had died. As of last week, 38 still await further review of their cases before proceeding; the rest await completion of an investigation.

“Our goal is consumer protection,” the board’s executive director Kimberly Kirchmeyer told MedPage Today. The board wants to “identify physicians who may be inappropriately prescribing to patients and to make sure that those individuals are educated (about opioid guidelines), and where there are violations of the Medical Practices Act, the board takes (disciplinary) action.”

Addressing her board during its quarterly meeting a year ago, Kirchmeyer described the project as an “invaluable” and proactive way to prevent future opioid overdoses by revealing overprescribers — “rather than have to wait for specific complaints to come in,” which are few and far between.

Coroners are required by law to report pathologist findings indicating a death was due to a physician’s gross negligence or incompetence, but the board had received only nine such reports in the prior 2 years, she said.

The board’s project is using death certificates and the CURES database to go beyond the individual fatality and examine a physician’s overall prescribing practices, Kirchmeyer said.

In some cases, investigations triggered by a death certificate identified other, living patients for whom that provider had possibly inappropriately prescribed, she said. That has resulted in a different letter sent directly to such patients saying that the board “is reviewing the quality of care provided to you by Dr. — ” and asking the patient to promptly authorize the doctor to turn over that patient’s medical records to the board. It also threatens to subpoena the records if the patient refuses.

Asked to address physicians’ concerns that these letters could erode patients’ confidence in their doctors, Kirchmeyer reiterated the goal to improve patient safety and said it only sends such letters to patients after a medical consultant “indicated that a physician may be inappropriately prescribing.”

It’s unclear to what extent other states may be targeting putative overprescribers in this way. A California board spokesman said their program was unique, but North Carolina’s medical board also initiates investigations based on patient fatalities involving opioids.

Specifically, North Carolina’s Safe Opioid Prescribing Initiative probes clinicians who’ve had at least two opioid-related patient deaths in the preceding 12 months and who prescribed at least 30 tablets within 60 days of the patient’s death, or when licensees have large numbers of patients on 100 milligrams of morphine equivalents (MME) per patient per day.

Letter ‘changed my practice’

On that December day, Lenzkes gathered his patient’s thick file and spent the next nights carefully writing six pages of the summary the board expected from him. Finally, nearly 3 months later, board analyst Erika Calderon exonerated him with a terse letter saying the review was complete: “No further action is anticipated and the file has been closed.”

Lenzkes was lucky. He’d kept good notes and was cleared. But, he said, “it changed my practice of medicine.” From now on, he’s referring patients like that one to pain specialists. “I’m not taking any more. That’s just how I feel.”

One physician who knows others who received these letters described it as “terrifying.” A typical response is to immediately contact an attorney and the malpractice insurance carrier.

Many doctors interviewed who received these letters say it has riddled their lives with stress and self-doubt, and then anger when they wait as long as 9 months, or longer, to hear they’ve been cleared.

Ako Jacintho, MD, a family medicine physician and addiction medicine specialist in San Francisco got a similar letter Dec. 11 about his patient who died on March 21, 2012, from “acute combined methadone and diphenhydramine intoxication.” He’d refilled the patient’s prescription for methadone 10 mg the day before, Jacintho said, but never prescribed diphenhydramine, the antihistamine sold as Benadryl.

“Back when my patient died, there was little warning on the dangers of prescribed opioids, and the Medical Board supported the treatment of intractable pain with prescription narcotics…. pharmaceutical companies said prescribed opioids were safe,” Jacintho said. “Methadone was in vogue for treating pain.”

He’s been waiting to hear back now going on 9 months of silence, despite several requests for a determination. It’s caused him loss of sleep and made it difficult for him to focus.

“I feel like I’ve been shamed,” Jacintho said. He started advising physician colleagues to stop prescribing opioids as he considered getting out of medicine altogether. He also hired an attorney.

“If they can’t see that this was me as a physician doing the best job that I could to help this patient with intractable pain, what am I supposed to do?” he asked.

Physician flight

“You can’t even begin to understand how disruptive and upsetting this is,” said Paul Speckart, MD, another San Diego internist who in March received a similar board letter about his patient who died in late 2012. The cause, Calderon’s letter said, in boldface type, was “carisoprodol, lorazepam, oxycodone, zolpidem and trazodone toxicity. Coronary artery atherosclerosis was the only medical condition noted…. Three providers prescribed heavily to this patient and one of them was noted to have been you.”

Speckart’s eight-page response went back to 1998 in which he documented his many refusals to give the patient scheduled drugs and his efforts to refer her to a pain specialist. In July, Calderon wrote Speckart “there was no problem” with his treatment of that patient, but “your overall pattern of prescribing opioids looks excessive.” He was told to read the guidelines issued by the board in 2014 and the CDC in 2016 and on prescribing controlled substances for pain, which he did.

He does not overly prescribe, he said. The few for whom he does prescribe opioids genuinely need pain relief for their multiple conditions.

As chair of a San Diego County Medical Society’s Emergency Medicine Oversight Commission, emergency room doctor Roneet Lev, MD, heard the physicians’ outcries. “We’ve definitely heard physicians say, ‘I’m done. I’m not going to see these patients; I don’t need this headache.’ And that’s left California without the doctors we need to treat these patients,” Lev said.

Her own study, published earlier this month in the journal Science, tested a gentler approach — a letter directly from the San Diego County medical examiner notifying physicians that a patient they treated died of an opioid overdose, rapidly informing them what happened to their patients. It served as an informed warning, unlike the medical board’s implied threat of disciplinary action.

Lev’s study found that within 3 months of receiving those letters, those physicians prescribed nearly 10% fewer opioid drugs compared with physicians in a control group who were not sent a medical examiner’s letter.

She said the medical board’s approach is “alarming” for several reasons. For starters, most physicians did not have easy access to the CURES database before 2014 to see what other drugs their patients had been prescribed by other providers, a concern since most patients who overdosed did not do so on one drug alone. Mandatory reporting for the system does not start until Oct. 1, 2018.

Second, at the time, there was no uniform standard on the total morphine equivalent dosage doctors should be prescribing, or how much is too much had been in dispute.

Third, the medical board’s approach is simply unrealistic, she said. “You have to remember, there’s still thousands of Americans who are on high-dose opioids, and you can’t just cut them off. They need to be weaned. Our job is to taper them to be safe.”

Lev said she reached out to Ted Mazer, MD, California Medical Association president, and Kelly Pfeifer, director of the California Health Care Foundation’s High-Value Care staff. She hoped to persuade the board to restructure the Death Certificate Project as an educational tool. Otherwise they worry that physicians will fear disciplinary action so much they feel they must hire lawyers, decide to stop taking patients, or refuse to prescribe pain relief.

The California Academy of Family Physicians declined to comment on the board’s project when approached by MedPage Today, but its web page sternly advises doctors to protect themselves by consulting and retaining an attorney “immediately upon contact” from the board regarding a patient who overdosed. “At no point during an investigation should a family physician be without legal counsel,” the organization said.

The California Medical Association’s associate director, Charlie Lawlor, said his group “remains committed to our continued work on effective policies that increase access to proven treatments for patients with addiction and dependency,” but is still reviewing the board’s program and wouldn’t comment on the merits of the project.

Kirchmeyer sought to refute arguments against the program’s tactics. She said all prescribers were held to the standard of care that was in place in 2012 and 2013. The medical board believes in its current approach because the CURES database shows that many deceased patients had received controlled substances from more than one prescriber, she said, and “it’s unclear whether any of these providers were actually aware that their patients were using multiple prescribers.”

Letter toned down

One criticism of the program, that the letters to physicians were far too threatening and inaccurately implied a family member had filed a “complaint,” has resulted in a major rewording, “based on feedback we received from doctors and consumers,” Kirchmeyer said.

Instead of telling them the board received a “complaint,” new letters sent this summer specify the source — records from the state Department of Public Health — and explain that the inquiry is meant to reduce “the alarming number of overdose deaths.”

It specifies that the review is “routine,” and stresses that “just because a patient death occurred, it does not automatically mean the physician deviated from the standard of care.”

Lenzkes, Jacintho, and Speckart said in separate interviews that the board is right to be concerned about overprescribing. “There’s a lot of abuse, we all agree,” Speckart said.

Added Lenzkes: “When you hear a bunch of doctors all at the same time all getting the same letter, and you realize they’re going through the same thing, you see why some are saying [to patients], ‘Sorry, if you have a lot of medical conditions, we’re not going to take care of you.'”

 

 

A Little-Known Windfall for Some Hospitals, Now Facing Big Cuts

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A Little-Known Windfall for Some Hospitals, Now Facing Big Cuts

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Most hospitals are nonprofit and justify their exemption from taxation with community service and charity care. But the Trump administration could require some of them to do more to help the poor, and the hospitals that are in the cross-hairs are those benefiting from an obscure drug discount program known as 340B.

The 340B program requires pharmaceutical manufactures to sell drugs at steep discounts to certain hospitals serving larger proportions of low-income and vulnerable people, such as children or cancer patients. The participating hospitals may charge insurers and public programs like Medicare and Medicaid more for those drugs than they paid for them and keep the difference.

By one estimate, the program saved hospitals $6 billion in 2015 alone. The original intent of the program, enacted in 1992, was for hospitals to use the revenue to provide more low-income patients a broader range of services.

Many institutions that serve mostly low-income and uninsured populations say they need the program. “Most nonprofit hospitals have very slim profit margins, and they’ve come to rely on this revenue,” said Melinda Buntin, chairwoman of the Department of Health Policy at Vanderbilt School of Medicine. A hospital lobbying group said that for some rural hospitals, the funding cut “could actually be the difference between staying open and closing.”

But there is concern that 340B has come to include hospitals that don’t need the extra help and are not using its windfall as originally intended.

The program has grown considerably, most recently as a result of an expansion included in the Affordable Care Act. As of 2004, about 200 hospitals benefited from the 340B program; by 2015, over 1,000 were participating. The program now encompasses 40 percent of all hospitals and an even larger number of hospital-affiliated clinics and pharmacies.

It might seem odd to give discounts on drugs to help hospitals offer care to low-income patients. How can we be sure they’ll use the money for that?

An increasing number of hospitals are not.

A study published in JAMA Internal Medicine found that the early participating hospitals were more likely to be located in poor communities with higher levels of uninsured people, to spend more of their budget on uncompensated care, and to offer more low-profit services than hospitals that started participating later.

“The 340B program may produce the results intended at some hospitals,” said Sayeh Nikpay, an assistant professor at Vanderbilt University and a co-author on the study. “But as the program grew, it benefited many hospitals with less need for assistance in serving low-income populations.”

Other research corroborates that hospitals aren’t using the 340B program as intended. A study in The New England Journal of Medicine was unable to find any evidence that profits from 340B have led to more access to care for low-income patients, or reductions in mortality rates among them. Another study in Health Affairs found that 340B hospitals have increasingly expanded into more affluent communities with higher rates of insurance.

The 340B program may have also inadvertently raised costs — for example, by encouraging care in 340B-eligible hospitals that could have been provided less expensively elsewhere. A study in Health Services Research found that hospital participation in 340B is associated with a shift of cancer care from lower-cost physician offices to higher-cost hospital settings.

The program may also encourage providers to use more expensive drugs. The more hospitals can charge insurers and public programs for a drug — relative to how much they have to pay for it under the program — the greater the revenue they receive. They also receive more revenue when the drugs are prescribed more often.

In January, Medicare lowered the prices it pays for 340B drugs by 27 percent. Although this move chips away at how much hospitals can benefit financially, it does little to address how much insurers and individuals pay for prescription drugs or the value they obtain from them. In addition, the move does nothing to increase hospital spending that could help the poor.

It may even harm some health care organizations, leading to lower-quality care at those institutions that are helping the poor. Studies have shown that, by and large, when hospitals lose financial resources, they make cuts that could harm some patients.

This can happen if cuts lead to reductions in workers who perform important clinical functions. A study in Health Services Research found that hospitals cut nursing staff in response to Medicare payment cuts in the late 1990s. Heart attack mortality rates improved less at hospitals that had larger cuts.

Another response to reduced revenue is cuts to specific services, which would harm patients who rely on them. A study by economists from Northwestern’s Kellogg School of Management found that some hospitals that endured financial setbacks during the Great Recession cut less profitable services like trauma centers and alcohol- and drug-treatment facilities.

Another study looked at a 1998 California law that required hospitals to comply with seismic safety standards — imposing a large cost on those institutions, without providing additional funding. Hospitals that were hit harder financially by this law were more likely to close; government hospitals responded by reducing charity care.

Hospitals could absorb cuts without harming care if they could become more productive — by doing more with less. Historically, there is very little evidence they have been able to do that.

Two powerful lobbies are now battling each other, with the pharmaceutical industry arguing that 340B has grown well beyond its original intent. Hospital lobbying groups are fighting back and also squaring off against the government, suing over the planned federal cuts.

Those are big clashes over a program that began modestly a quarter of a century ago to help the poor, albeit in a most convoluted way.