Risking lives in pursuit of profits

https://mailchi.mp/05e4ff455445/the-weekly-gist-february-26-2021?e=d1e747d2d8

Benefit of Private Equity in Healthcare? Lessons from Nursing Homes

Finding a good long-term care facility for a loved one has always been a difficult process. A new National Bureau of Economic Research working paper suggests that families should also be paying attention to who owns the facility, finding a significant increase in mortality in nursing homes owned by private equity investors.

Examining Medicare data from over 18,000 nursing homes, 1,674 of which were owned by private equity (PE) firms, researchers found that PE ownership increased Medicare patient mortality by 10 percent—translating to a possible 20,150 additional lives lost. PE-owned facilities were also 11 percent more expensive.

Counterintuitively, lower-acuity patients had the greatest increase in mortality. Researchers found staffing decreased by 1.4 percent in PE-owned facilities, suggesting that shorter-staffed facilities may be forced to shift attention to sicker patients, leading to greater adverse effects on patients requiring less care.

Antipsychotic use, which carries a higher risk in the elderly, was also a whopping 50 percent higher.

Nursing homes are low-margin businesses, with profits of just 1-2 percent per year—and PE ownership did not improve financial performance.

Researchers found private equity profited from three strategies: “monitoring fees” paid to services also owned by the PE firm, lease payments after real estate sales, and tax benefits from increased interest payments, concluding that PE is shifting operating costs away from patient care in order to increase return on investment. Private equity investment in care delivery assets has skyrocketed over the past decade.

This study draws the most direct correlation between PE investment and an adverse impact on patient outcomes that we’ve seen so far, highlighting the need for increased regulatory scrutiny to ensure that patient safety isn’t sacrificed for investor returns.

The huge return on investing in coronavirus tests

Report: Government spending on testing and tracing pays for itself more  than 30 times over - Axios

Government spending on testing and contact tracing pays for itself more than 30 times over, according to yet another paper published in JAMA (good series!).

What they found: Harvard economists David Cutler and Lawrence Summers calculated the total cost of the coronavirus pandemic at more than $16 trillion in the U.S. alone. Of that, about $7 trillion is attributable to loss of life and long-term impairment from the disease, Axios’ Felix Salmon writes.

  • Enhanced testing and tracing would cost about $6 million per 100,000 inhabitants, they calculate. Out of that population, 14 lives would be saved, on which they place a value of $96 million, and 33 critical and severe cases would be avoided, representing savings of $80 million.
  • That adds up to $176 million in benefits from $6 million in costs — before taking into account any second-order effects from even fewer cases down the road.

The bottom line: “Currently, the U.S. prioritizes spending on acute treatment,” write Cutler and Summers, “with far less spending on public health services and infrastructure.”

  • Going forward, they write, “a minimum of 5% of any COVID economic relief intervention should be devoted to such health measures.”

The coming vaccine chaos

The coming coronavirus vaccine chaos - Axios

The first coronavirus vaccine will likely get authorized within months, but that will only be the beginning of what’s likely to be a long, chaotic vaccination process, the New York Times’ Carl Zimmer reports.

The big picture: The first vaccines probably will offer only moderate protection against the virus, meaning we can’t ditch our masks even if we get one. And we probably won’t have a good way to choose between these vaccines once several of them are on the market.

  • Some vaccines that are in earlier stages of development today may struggle to cross the finish line, even if they work better than earlier vaccines.
  • And some vaccines may be pulled off of the market because they’re unsafe.

Between the lines: Some of this is inherent to the breakneck speed of the vaccination effort, but some of it is a result of how that effort was designed.

  • Earlier this year, some government scientists had wanted to test vaccine candidates against each other, instead of testing all of them against a placebo. But these kinds of trials are risky for drug companies, because they show the value of one vaccine against another.
  • That information could be useful for patients, but is a business risk for manufacturers.
  • You have to have the total cooperation of the pharmaceutical companies to get involved in a master protocol,” top infectious disease expert Anthony Fauci told NYT. “That — I don’t know what the right word is — didn’t turn out to be feasible.”

Indiana hospital employee fired after speaking to New York Times

https://www.beckershospitalreview.com/hr/indiana-hospital-employee-fired-after-speaking-to-new-york-times.html?utm_medium=email

Hospital Employee Is Fired After Speaking to The New York Times - The New  York Times

NeuroBehavioral Hospital in Crown Point, Ind., terminated the employment of a discharge planner last week after she spoke to the New York Times about nursing homes discharging unprofitable patients, a practice known as “patient dumping,” the NYT reports.

In the Sept. 19 NYT article, Kimberly Jackson said that during the pandemic nursing homes in Illinois and Michigan have repeatedly sent elderly and disabled Medicaid patients to NeuroBehavioral Hospital, a psychiatric facility, even though they were not experiencing psychosis, seemingly in an effort to get rid of patients who are not lucrative for reimbursement or require extra care. 

“The homes seem to be purposely taking symptoms of dementia as evidence of psychosis,” Ms. Jackson is quoted in the article.

She was fired from NeuroBehavioral Hospital Sept. 24. Rebecca Holloway, the hospital’s corporate director of human resources, told the NYT that Ms. Jackson violated the hospital’s media policy. 

Ms. Jackson told the newspaper she was shocked to be fired for speaking to the media.

“I saw something that was wrong, and I called it out,” she said.

NeuroBehavioral Hospital is part of NeuroPsychiatric Hospitals. The South Bend, Ind.-based network has five facilities in Indiana, two in Texas and one in Arizona.  

 

 

Medicare Advantage should not ‘game the system’ but prioritize patient care, honest billing

https://www.healthcaredive.com/news/medicare-advantage-should-not-game-the-system-but-prioritize-patient-care/585613/

We all agree healthcare providers should prioritize patient well-being and bill honestly. Most do. But, if not, my office, the Office of Inspector General for the HHS, and other government agencies, are watching. 

We are especially monitoring an area of concern: abuse of risk adjustment in Medicare Advantage, the managed care program serving 23 million beneficiaries, 37% of the Medicare population, at a cost of about $264 billion annually. We have good reason to pay attention. Our recent report found that Medicare Advantage paid $2.6 billion a year for diagnoses unrelated to any clinical services.

Plans used a tool called “health risk assessments” to collect these diagnoses. Ideally, health risk assessments might be part of a Medicare beneficiary’s annual wellness visit and help care teams identify health issues. However, some Medicare Advantage plans use risk assessments without involving the patients’ regular care providers. 

Some plans partner with businesses whose primary livelihood entails identifying diagnoses by conducting risk assessments. Some organizations send professional risk assessors, perhaps practitioners with some medical credentials but not physicians or other clinicians involved in the person’s care, to the beneficiaries’ homes.  Our study found that 80% of that extra $2.6 billion payment resulted from in-home health risk assessments. 

Medicare’s capitated payments vary by beneficiary for good reason. If Medicare paid the same for every beneficiary, plans might favor younger and healthier enrollees. It may not hold true every month, but, on average, it will cost a plan less to serve a healthy 65-year-old than an older person with diabetes or cancer.

Risk adjustment tailors the capitated rate to each beneficiary’s expected costs, so plans should enroll any interested beneficiary and not discriminate. But the risk adjustment is just a projection. Beneficiaries need not actually incur higher costs for the plan to receive higher payments. Some beneficiaries with a seemingly low risk will incur high costs in a given year and some beneficiaries with a high risk will incur low or even no costs.

In fact, one Medicare Advantage plan received about $7 million for beneficiaries who did not appear to receive any clinical care that year — other than the risk assessment, which was the only reason for the higher Medicare payment. Finding beneficiaries with high risk scores but low care utilization can prove a profitable business strategy. 

Without gaming, on the aggregate, risk-based payments and utilization should even out over time.  But what if plans do game the system? Perhaps making their beneficiaries look sicker? Or not providing care for beneficiaries’ health conditions?

We identified two main concerns:

  • bad data — risk of incorrect diagnoses identified in the health risk assessment resulting in incorrect payments to plans.
  • suboptimal care — risk that diagnoses are correct, but patients are not getting the care they need.

The question of whether beneficiaries are experiencing quality and safety problems requires more study. For example, it is possible that beneficiaries are receiving care, but plans are not submitting this data as required. Regardless, plans that use risk assessments to gather diagnoses, but then take no further action, are clearly missing an opportunity for meaningful care coordination. We urge Medicare Advantage plans to:

  • Ensure practices drive better care and not just higher profits.  
  • Enact policies and procedures to ensure the integrity and usefulness of the data.

This could include measures like educating patients about the identified diagnoses and sharing them with caregivers. These steps are consistent with the best practices identified by CMS and provided to Medicare Advantage Plans in 2015.

It is not necessarily bad that Medicare allows risk assessments to influence payment, trusting that plans use risk assessments to identify missed diagnoses and not to fabricate nonexistent diagnoses. 

However, this practice only helps patients if there is some additional intervention to improve care. If risk assessments are performed by third parties, at minimum, the beneficiary and the beneficiary’s care team should learn the results. Risk assessments should trigger meaningful care coordination, patient engagement and help ensure the care team takes appropriate action. Risk assessments that generate diagnoses for payment purposes, but result in no follow-up care raise serious concerns.

Ensuring beneficiaries receive the care they need should be front of mind for executives as they design risk assessment programs with an eye to quality of care and better care coordination. Failing that, executives should know that government agencies will scrutinize risk adjustment for abuse. 

In response to our report, CMS promised to provide additional oversight and target plans that reap the greatest payments from in-home health risk assessments and conditions generated solely by risk assessments for which the beneficiaries appeared to receive no other clinical services. My office has identified red flags in some industry patterns and recommends plans adopt best practices. Executives should champion best practices and make sure their plans are driving correct diagnoses and quality care.

Ensuring that beneficiaries are properly diagnosed is important, not just for the integrity of taxpayer-funded federal healthcare programs, but also for the welfare of the beneficiaries served. Coordinating care and providing appropriate follow up is critical.

My office and other government agencies are targeting oversight to make sure plans do not pad risk adjustments with unsupported diagnoses. When plans find new real diagnoses, the plans deserve the extra payment, but only if patients get appropriate care.