Healthcare Competition Needs a Priority Check and Reset, Experts Say

http://www.healthleadersmedia.com/leadership/healthcare-competition-needs-priority-check-and-reset-experts-say

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Farzad Mostashari, MD, the former National Coordinator for Health IT at the Department of Health and Human Services, and Martin S. Gaynor, a professor of economics and health policy, discuss how policy helps and/or harms competition in the healthcare marketplace.

Despite the near-universal agreement that the U.S. healthcare delivery system should remain market-based, there has been surprisingly little talk amongst government policy makers and private payers about the potential for stifling competition with over-regulation.

An essay this month in JAMA calls for a re-examination of how healthcare rules, regulations, and policies help or harm competition in the healthcare marketplace.

Farzad Mostashari, MD, the former National Coordinator for Health IT at the Department of Health and Human Services, and Martin S. Gaynor, a professor of economics and health policy at Carnegie Mellon University, two authors of the essay, spoke with HealthLeaders last week. The following is a lightly edited transcript.

Selling Health Insurance Across State Lines Is Unlikely to Lower Costs or Improve Choice

http://www.commonwealthfund.org/publications/blog/2017/apr/selling-health-insurance-across-state-lines?omnicid=EALERT1190217&mid=henrykotula@yahoo.com

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In the wake of the failure of the legislative effort to repeal and replace the Affordable Care Act (ACA), the fate of another of the president’s health care priorities is unclear. In his first congressional address, President Trump articulated five principles for health care reform. His fifth and last called for giving “Americans the freedom to purchase health insurance across state lines,” a reform that, in his words, would create “a truly competitive national marketplace that will bring cost way down and provide far better care.” This concept was not in the House reconciliation bill (the “American Health Care Act” or AHCA) to repeal and replace key provisions of the ACA, but President Trump may be able to use his regulatory authority to promote the cross-border sales of health insurance.

The president has the authority to act on his own thanks in part to the ACA. That law includes a provision encouraging “health care choice compacts,” whereby an insurer could establish itself in one state and sell health insurance to consumers in multiple other states without having to follow those states’ laws and regulations. However, under President Obama, the U.S. Department of Health and Human Services (HHS) never published regulations enabling these cross-state sales.

While the ACA provision encourages states to enter into cross-state regulatory agreements in order to facilitate interstate sales, under Trump’s campaign and several congressional proposals, the federal government would effectively override states’ authority to regulate their markets. In the absence of legislative action, there is nothing preventing HHS Secretary Tom Price from issuing the required regulations and working with states to develop standards for interstate sales. In fact, several states already allow cross-state sales.

 

How Republicans Can Escape Their Health Care Dilemma, Part 3: Responsible Federalism

https://www.forbes.com/sites/theapothecary/2017/03/31/how-republicans-can-escape-their-health-care-dilemma-part-3-responsible-federalism/#46636dd45063

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This is the last in a series of three posts. I’ve proposed three approaches that Republicans might use to get out of  the dilemma they are in over health care:

  • Universal catastrophic coverage (Part 1)
  • Universal safety net (Part 2)
  • Responsible federalism (Part 3)

The Case for a Responsible Federalism

We have had federalism in health care for many decades. The grandaddy of them all is the open-ended Medicaid program which obligates Uncle Sam to pony up federal matching dollars in lock-stop with state willingness to put up their dollars. As AEI health policy expert Joe Antos recently pointed out, Medicaid has needed fixing for 50 years. But even before that we have had federal grant-in-aid programs dating back to the 1930’s that channeled federal dollars into health care. In my view, responsible federalism in health care would entail reforming the perverse fiscal incentives embedded in Medicaid while also offering states much greater flexibility to solve their health problems without the heavy hand of Uncle Sam.

 

How Republicans Can Escape Their Health Care Dilemma, Part 2: Universal Safety Net

https://www.forbes.com/sites/theapothecary/2017/03/31/dilemma-part-2-universal-safety-net/#215199391108

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This is the second in a series of three posts. In my last post I posed a dilemma: President Trump has argued repeatedly for “coverage for all.”  The CBO score showing that the AHCA would result in a loss of coverage for 24 million Americans was devastating for its political prospects. Yet Obamacare, despite leaving tens of millions of Americans uninsured, is universally viewed by Republicans as fiscally unsustainable over the long term. I’ve proposed three approaches to getting out of  this box:

  • Universal catastrophic coverage (Part 1)
  • Universal safety net (Part 2)
  • Responsible federalism (Part 3)

The Case for a Universal Safety Net

A universal safety net offers the possibility of a bipartisan reform that is politically feasible at an affordable cost. Again, there is more than one way to achieve this, but I will provide two examples.

 

How Republicans Can Escape Their Health Care Dilemma, Part 1: Universal Catastrophic Coverage

https://www.forbes.com/sites/theapothecary/2017/03/31/how-republicans-can-escape-their-health-care-dilemma-part-i-universal-catastrophic-coverage/#64adb55c193e

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The demise of the American Health Care Act (AHCA) on March 24 was a humiliating defeat for both President Trump and Speaker Paul Ryan, both of whom had pledged the repeal and replacement of Obamacare would be the first order of business under a Trump administration. Now they both plan to move on to tax reform and it remains to be seen when or how a repeal and replacement effort will be resurrected.

I sit in an ivory tower, so perhaps my views will be dismissed as hopelessly unrealistic. But having studied health reform for more than four decades, the prospects for success are not as dim as most might think. This three part series by no means exhausts the possibilities, but should give readers a rough sense of three possible paths out of this mess. These include:

  • Universal catastrophic coverage (Part 1)
  • Universal safety net (Part 2)
  • Responsible federalism (Part 3)

President Trump has argued repeatedly for “coverage for all.”  The CBO score showing that the AHCA would result in a loss of coverage for 24 million Americans was devastating for its political prospects [1]. Yet Obamacare, despite leaving tens of millions of Americans uninsured, is universally viewed by Republicans as fiscally unsustainable over the long term. Therein lies the Republican’s political dilemma.

 

California Cost & Quality Atlas Helps Map Path to Higher-Value Care

http://www.chcf.org/articles/2017/04/ca-cost-quality-atlas

Bringing Together California Commercial Quality-Cost Performance, by Region, 2013

California is often celebrated for its rich diversity. Geographic, population, and cultural differences are embraced as key ingredients that make our state successful. But when it comes to health care services, differences are neither expected nor valued.

Study after study indicates that where you live has a direct impact on your health and well-being. In fact, as Dr. Tony Iton of The California Endowment has said about determinants of health status, your zip code is probably more important than your genetic code. One look at the results from an Integrated Healthcare Association online tool, the California Regional Health Care Cost & Quality Atlas, confirms wide geographic variation in health care measures across the state — and the tremendous opportunities that exist to improve quality and contain costs.

What drives this variation? More importantly, what can be done to minimize it? While some of the variation in care delivery may reflect differences in patient populations and needs, other differences are unexplained and likely unwarranted.

Benchmarking and tracking performance on key health care quality and cost measures is a critical first step in reducing unwarranted variation.

Dramatic Variations Across the State

As shown in the table below, quality gaps for people enrolled in commercial insurance products are common across the state’s 19 geographic regions, and the atlas data pinpoint significant opportunities to improve care for hundreds of thousands of people.

 

The Perverse Effects of Maryland Drug-Price Bill

http://www.realclearhealth.com/articles/2017/04/04/the_perverse_effects_of_maryland_drug-price_bill_110530.html?utm_source=RealClearHealth+Morning+Scan&utm_campaign=2ee066e433-EMAIL_CAMPAIGN_2017_04_04&utm_medium=email&utm_term=0_b4baf6b587-2ee066e433-84752421

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As President Trump said, health care is “complicated.”

When it comes to health care in America, virtually everyone claims to have the same broad goals: Accessibility to decent care that is affordable and not have it cost businesses and government (read: taxpayers) a fortune.

Good intentions abound, but politically feasible solutions are in short supply, and many bad or simplistic ideas are bandied about by policymakers on both sides of the aisle. A case in point is a Maryland bill that would crack down on “price gouging” by prescription-drug makers. The bill, which passed the House of Delegates on March 20 with an overwhelming, bipartisan margin of 137-4 and will probably be taken up by the Senate in the next few days, seems like a no-brainer. As Maryland Attorney General Brian Frosh said: “We’ve seen in Maryland and all over the country drug prices [are] skyrocketing.

However, the devil is in the details, and devilish it is. The bill, H.B. 631, excludes pricey brand drugs and only targets generic-drug makers, whose medicines save Maryland residents and taxpayers about $3.7 billion a year. If the bill becomes law, the state Attorney General could take generic drug makers to court for price increases that are vaguely described as “unconscionable.” Unconscionable is a legal doctrine used when consumers have no option to purchase an essential product at inflated prices. However, under the proposed Maryland law, it could be invoked when a generic maker increases the price of a pill from 15 cents to 50 cents but not when the manufacturer of a brand drug increases its price from $300 to $500 per pill.

Generics are a proven solution to high drug costs that saved America approximately $227 billion in 2015, including $90 billion for Medicare and Medicaid. Generics account for 89 percent of all prescriptions written, but only 27 percent of U.S. spending on medicines. In short, generics and a new class of off-brand drugs called biosimilars reduce health care costs and get affordable medicines into the hands of patients who need them most.

 

Is U.S. Preeminence in High-Tech Medicine a Myth?

http://www.commonwealthfund.org/publications/blog/2017/apr/us-preeminence-in-high-tech-medicine?omnicid=EALERT1189645&mid=henrykotula@yahoo.com

U.S. health care has many well-documented shortcomings. However, it is often assumed that, because we invest so heavily in technology and specialists, our health care system performs well for patients who have rare or complex diseases.

New research shows that we should be skeptical of that assumption. A recent study in the Annals of Internal Medicine compares the health outcomes of U.S. and Canadian patients with cystic fibrosis, an incurable, genetic disease that affects about one in 10,000 people in both countries. The results are disturbing: on average, Canadian patients live 10 years longer than American patients. And the gap has been widening for the past two decades (see exhibit).

Median Age of Survival for Patients with Cystic Fibrosis over Time

Median age of survival (years)

The researchers suggest the likely culprit is the significant gaps in health insurance coverage among U.S. children and adults under age 65. Uninsured patients with cystic fibrosis, they find, face a much greater risk of early death than their insured peers. Of particular note, given recent events in Washington, D.C., Medicaid patients have significantly better health outcomes than those without insurance, despite the fact that they tend to be poorer and more socially vulnerable.

In Canada, of course, there are no uninsured: the government provides universal health coverage for all residents, without copayments for physician visits or hospital stays. (The study also finds that Canadian patients are much more likely to receive a lung transplant than U.S. patients—shattering another common assumption about the U.S. health system’s technological superiority.)

When one considers the medical needs of people with cystic fibrosis, it is obvious why lacking health insurance could lead to an early death. The disease causes abnormal secretions to impair functioning of the lungs, pancreas, and other organs, which in turn leads to infections and lung damage, and prevents the body from properly digesting food. Inhibiting the build-up of these secretions and ensuring proper nutrition and wellness are crucial to preventing the rapid progression of the disease. In this context, staying well requires constant self-management and frequent contact with the health care system—which comes at a cost. Coverage gaps and financial barriers to care are incredibly dangerous for these patients and can quickly undermine their health.

And while several promising pharmaceuticals that treat cystic fibrosis have hit the market in recent years, these are priced at a quarter of a million dollars . . . per year. High-quality care is simply out-of-reach for patients without insurance.

In medical terms, we might call uninsurance a “comorbidity”—one unique to the United States among all industrialized nations, and just as deadly as pneumonia or diabetes.

The study is a reminder, if one was needed, of the fundamental problem with the U.S. health insurance system: not everyone is covered. The focus of would-be health reformers should be—not solely on whether the 20+ million Americans who gained coverage under the ACA should be allowed to keep it—but rather how to extend those gains to the 28 million remaining uninsured. For some, their lives will depend on it.

2017 Northern California State of Reform Health Policy Conference

http://stateofreform.com/conference/2017-northern-california-state-reform-health-policy-conference/register/?utm_source=State+of+Reform&utm_campaign=892e183965-5+Things+CA+August&utm_medium=email&utm_term=0_37897a186e-892e183965-272256165

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What a Bipartisan Approach to U.S. Health Care Could Look Like

https://hbr.org/2017/03/what-a-bipartisan-approach-to-u-s-health-care-could-look-like?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+harvardbusiness+%28HBR.org%29

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As a friend once told me, “Government is about compromise.” That friend was Tommy Thompson, a four-term governor of Wisconsin who went on to serve in George W. Bush’s cabinet as secretary of health and human services.

With the failure of the American Health Care Act, recently proposed by Republicans in the U.S. House of Representatives, it is clear that the Affordable Care Act (ACA) will continue to serve millions of Americans for the foreseeable future. Of course, the ACA (or Obamacare) remains a flawed law. But rather than allow it to “implode” or “collapse,” as some suggest it will (e.g., President Trump), a group of Republican and Democratic leaders in Washington should take action and fix the broken elements of the ACA for the good of the millions of Americans who depend on it. It is time for a compromise.

What might such a bipartisan agreement look like? Here are some ideas.