Healthcare is expensive. This is a fact. To get into the details for why it is expensive is a topic for another time. But the big push over the last few years has been to decrease the cost of healthcare. More to the point, the push to decrease cost of healthcare has been to simply pay less for healthcare by the government through Medicare and Medicaid. Ever since President Obama passed his magical ObamaCare act, the healthcare system has been in a constant state of flux. CMS/HHS (center for Medicare) has been churning out new rules and initiatives at break-neck speeds all in an attempt to leave most hospitals and healthcare systems in a state of fear and bewilderment; they are the Neagan to our Rick. By this point, most of the larger hospitals and healthcare systems have fallen in line and “volunteered” to start choking down at least one of the alternative plans for reimbursement. But what effect will this have? What do we have to look forward to?
I’m glad you asked.
A quick perusal through the CMS website will grant you information on the BPCI, which is the bundled payment plans for hospitals and post-acute care facilities. There are 4 different models with models 2-4 being the primary options. For reasons that become rather obvious, model 2 is the overwhelming favorite in the same way that getting smacked in the face is preferable to getting kicked in the balls. Briefly, model 2 (BPCI-2) retrospectively pays a bundle payment based off an episode of care to hospitals that participate in the program while still paying the fee for service rates to the physicians. In other words, if you have Medicare and come in with a pneumonia then Medicare will continue to “pay” like fee for service while you are in the hospital but will then compare that cost to their pre-determined bundle payment after you are discharged and come to a reconciled final amount to pay the hospital after the fact. This also includes post-acute care costs 30, 60, or 90 days out. Thankfully, this does not include physician costs. This beats model 4 (BPCI-4) where Medicare prospectively (as soon as you enter the door) pays a bundled amount without negotiation which is also to include your post-acute care costs as well. This includes physician costs. At this time, only 10 programs are dumb enough to continue down the model 4 road.
Now, for all these hospitals included in the above plans, they get to pick from a list of 48 distinctive diagnoses to be used as benchmarks for comparison to other hospitals as well as for reimbursement purposes. Not surprisingly, most picked major joint replacements with far less picking such exciting things like heart failure and COPD. Being able to pick the metric that is to be used as a tool for grading and scrutinizing oneself must be a nice perk. I hope the hospitals enjoy it while it lasts. I also hope they also enjoy believing that this is all “voluntary”.
But I digress. Someone must want to know how hospitals are doing when it comes to decreasing cost and improving quality through metrics of their own choosing, right? CMS sure as hell does! They hired a company to put together a report published in August 2016 based off information through 2014 to look at how things were going. Here are some highlights:
- Orthopaedic surgery costs on average went down $864, they sent people to less SNFs [skilled nursing facilities] (64% to 57%), and those that went to SNFs spent 1.3 days less. The down side? Medicare paid, on average, $2137 less per episode from baseline through the intervention period. Ouch. Keep in mind, 75% of hospitals participated in this metric.
- Cardiovascular surgery saw relatively stable reimbursement through the intervention period (Great!) as long as they did not go to a SNF (SHIT!). If the patient had to go to a SNF, or any other institution post-discharge, hospitals were on average shorted $4149. Now, their rates for SNFs decreased (55% to 44%), but that is still a large number. Furthermore, their ED visit rate increased as well. Can you imagine what this looks like yet?
- Lastly, spinal surgery seems to be the only success story (or failure, depending on your prospective). Their reimbursement INCREASED $3477 with overall no major changes. Guess what specialty is next on the chopping block?
In short: it appears cost is going down but reimbursement may be going down at a faster rate.
“But aren’t there incentives like value-based purchasing which are supposed to reward high-performing hospitals?”
Excellent question! Let us look at this value-based purchasing program initiated by CMS. This is a program with the goal of rewarding “quality” of care over “quantity” of care. Sounds like a great idea until you realize that both those words effectively mean nothing and are little more than trite, banal aspirations set forth by the demon princess, Sylvia Burwell, herself.
The Value-Based Purchasing program is a program that came into effect in 2013 and seems to gradually change every year in some shape or form. It allows CMS to base payments off “Set measures and dimensions grouped into specific quality domains”. At this time, two percent of Medicare reimbursements are being tied to this program and the score which determines whether or not you see any of that money again is based on some revolving and arbitrary criteria. Below is an overview of how each is weighted:
- Outcomes = Safety and patient experience = patient and care-giver experience.
Take a second to really read that chart. I want you to try and imagine what this program is really trying to reward. From 2016 there is a 40% weighing towards outcome/safety which drops off to 25% by 2018. By 2018, your safety/outcomes are as important as your “experience” in the hospital. To put it another way, it is equally important that you enjoy your hospital dinner as it is that you not get a surgical site infection or C diff. And if you do not know what C diff is, please consult Dr. Google.
“But two percent is pretty small, right?”
Sure, the number two is small. But let me better demonstrate the current impact by a simple math problem: What is 2% of $500 million? Answer: $10 million. Do you find that number to be insignificant? If so, let me know, I have a bank account I would totally love for you to donate an insignificant amount of money towards. Hospitals, however, do not find this number insignificant; they find it terrifying. They have invested large sums of money to play the “value game” and shove it down the throats of every single employee all because they are being scored on the above arbitrary measures and being given a final number that dictates where they fall in the spectrum of “providing value”. For those that are in the health care field, this is where the HCAHPS scores come into play with “patient experience”. This is why you are hearing administrators drone on and on about going from an 8 to a 9 in patient satisfaction because if you drop too low you lose. This is why even if you do your job perfectly you are a failure due to circumstance you cannot control because they are irrelevant to your goals. This is why you are a glorified, narcotic-dispensing, note monkey.
It should be noted that the scores for value-based purchasing are completely relative to the scores of other hospitals. If everyone is scoring 97% on a metric, then the only way to see any benefit may be to score 98.5% which is challenging even by Tiger Mom standards. CMS may periodically change the metrics around to keep it interesting but, contrary to popular belief, most hospitals are already doing a pretty good job at that whole “keeping people alive” thing. Eventually, there will be a ceiling in which there can be no realistically obtainable improvements. At that point, stagnation occurs and innovation through desperation will lead to some rather interesting creations. Ultimately, the best that hospitals will be able to look forward to is to simply not lose more money from the VBPires.
But it doesn’t end there; It is just the beginning. If this program was only going to max out at two percent, it may not be so bad. There are always ways to reallocate resources to stem the bleeding. Burwell and her HHS minions have much greater plans and have made it a point to be rather transparent to her victims through the New England Journal of Medicine.
In 2015, Burwell wrote an article laying out her plan. Titled: HHS efforts to improve U.S health care, Burwell discussed plans for tying a larger and larger percentage of Medicare payments, whether it be fee for service or bundled payments, to the concept of “quality”. How much? Well, Burwell wants 85% of fee for service payments linked to “quality” by 2016 and 90% of those payments linked by 2018. At the time this article was written, only 20% was tied to “quality”. Regarding the alternative payments (read: bundled payments), Burwell has decided to tie 30% of those payments to “quality” by 2016 and 50% by 2018. Can you take a wild guess at what the purpose of those rather disparate percentages could be? Can you feel the walls closing in around you? No? Well, the hospitals probably can. You will too, in time.
Burwell proceeds to further lay out her sinister plan of throttling the health-care system through various different means. Most of her plan is laid out in double-speak, so it does take some effort at translation, but I will try and do the best I can. First up, Burwell states she intends to “create an environment in which hospitals, physicians, and other providers are rewarded for delivering high-quality health care AND have the resources and flexibility to do this.” Sounds great, right? Sounds aspirational. This phrase probably gives some people the warm-fuzzies and fills their heads with ambiguous thoughts of “fixing health care”. If this is you, you are an idiot. Or at the very least, really, really gullible. You must keep in mind that Burwell and the HHS are not out to “fix” health care; they are out to make it cost less. That is the bottom line; that is the goal of this reform. This is evident by the next paragraph which goes onto talk about creating further alternative payment models for cancer treatment and other specialty care. (For those not in the know: cancer hospitals/centers are currently DRG-exempt and can be rather lucrative and off-set costs of other less sexy conditions like COPD, pneumonia, liver disease, etc) Again, this sounds rather aspirational and reasonable until you find yourself faced with the indisputable fact that treating cancer is expensive as hell! There is a lot of money that goes into treating cancer, from the bench research and clinical trials to the manufacturing of next-generation gene-specific cancer therapies, the cost associated is astronomical. However, save for a few therapies and specific cancer diagnoses, most treatments for cancer provide little more than a few extra months of life with questionable quality. Hundreds of thousands of dollars spent to have an extra few weeks to few months, the majority of which may be spent in a hospital setting, is the very definition of current cancer treatments.
Can you see it yet? Burwell is not out to improve the “quality” of cancer care. The current “quality” of cancer care is already exceptional and to some degree decadent. This decadence is what needs to be extinguished. But the Powers-That-Be at HHS are smart enough to know they cannot outright ban costly treatments; that is not the American Way. The backlash from a move like that would bring the whole charade crashing down. Instead, Burwell and Co, are quickly creating an environment where the hospitals, and to some extent the physicians, will be forced to make the decision on how best to triage care relative to financial solvency. The government may never explicitly state “Don’t use this treatment, it’s expensive as hell and a poor use of resources!” but they sure as hell will refuse to cover the cost of those expensive treatments under the guise of “bundled payments” which will ultimately leave the physician weighing the pros and cons of appropriate resource utilization against the life of their patient. How does one explain to a patient, and their grieving family, that nothing further can be done because no one will pay for it? How do physicians continue to be physicians once “accountant” becomes a part of their job title? The answer: “It doesn’t matter. It costs less.” – Burwell while drinking fresh virgin blood.
“Well, it has to happen, doesn’t it? Haven’t we gone a little overboard on all these cancer treatments anyways? You even said it yourself, they only get a few months at best.”
Agreed, but it’s not just cancer treatments. The above scenario applies to ALL chronic diseases, or at least will in time. How will the treatment of advanced heart failure or COPD change in the near future? Will we continue to offer LVADs, frequent hospitalizations for diuresis, lung transplants, or heart transplants? Will we set a limit on the number of admissions one is allowed over three months for their chronic conditions? Will research come to a halt due to lack of funds and profits for new therapies? (Europe may be able to answer that question for us) And again, none of these answers will come from CMS/HHS/Burwell and company; they will be reluctantly answered by the hospitals and physicians under the whip of the insurance companies and government. This, in turn, will change the very culture of those involved in providing health care. Altruism, despite its several flaws, is a primary motivator for many in the health care field. How will that change once you fully transform medicine into an “industry” with the focus becoming the bottom line? Will you still attract the intelligent and independent thinkers that have so often gone into the field? Or will you attract customer-service oriented, guideline-directed, intellectually-throttled, bureaucrats that see the patient’s cost as their fifth vital sign? The change will be gradual but there will be a change. Prepare yourself.
For many in the health care field, the future of health care is considered “uncertain”; this is a self-imposed deception to shield themselves from the truth. The future of health care, at least at this time, is very certain and viewed with variable degrees of optimism relative to one’s station in the health care industry. For those in Burwell’s boat, flying the Jolly Roger and riddled with scurvy, the future looks rather bright. Costs will go down, health care will become more “accessible”, and hospital and health care systems will make great efforts to demonstrate their “value”. For those in the trenches, the future is far less bright and will likely consist of a never-ending stream of best-practice advisories in the form of unavoidable pop ups through the EHRs (electronic health records), increased focus on “customer service” and satisfaction scores in the form of yearly modules and quarterly reviews, as well as increasing scrutiny over documentation and hospital-encounter costs per physician. For patients, your care will likely dramatically change and your “satisfaction” will likely be further pursued to your detriment. In some ways, it is already happening. I cannot tell you the number of patients I see, transferred from other hospitals that were bound and determined to kill them, and hear nothing but praise about that transferring facility due to their expansive and highly palatable meal options. It did nothing for their disseminated histoplasmosis, but I’m sure it still received excellent reviews. But while your Salisbury steak gets more palatable, your options for treatment will gradually be restricted, and you will ultimately be provided with less avenues in which to delay your death. Intensive care services will gradually be rationed and we will likely see a system not too dissimilar to Brazil where litigation is often used to acquire an ICU bed due to limited resources. Palliative care will continue to become more important. Hell, it already is becoming more utilized for various reasons, one of which is spelled out by the advisory board as “saves hospitals thousands of dollars per inpatient case and reduces ICU length of stay, contributing to cost savings and freeing up of capacity”. And don’t get me wrong, palliative care is extremely important, especially in our current health care system, but do not keep expecting that it will forever remain a choice to “keep fighting” as the baby-boomer time bomb continues to tick down. The best one can hope for is that they are wealthy in the future because “executive medicine” isn’t going anywhere anytime soon.
“Isn’t this all a little extreme? Besides being a total buzz-kill, you seem to be taking this pretty far.”
It is extreme. And I am a buzz-kill. But this is the plan taken to its logical conclusion with each step being revealed at the very moment the path behind you has fallen away. Many hospitals and health care systems were lured in with the prospect of financial gain through actions which many were already pursuing; I assume the thought was that this would be easy money. In contrast to this opportunistic stance taken by many health care systems, physicians seemed to take a more fatalistic approach. They began accepting those changes as inevitable and, because physicians are cowards, never made any real attempt to resist. The AMA, which is supposed to be a lobbying group FOR physicians, showed where their true allegiances lay by strongly supporting Obamacare for reasons which had nothing to do with improving the lives of physicians. What did it have to do with? Money. So, here we are, about five years or so into this Brave New World, and the future is starting to come into view over the horizon. Despite President Meme Trump threatening to dismantle Obamacare (he won’t, at least not significantly), the wheels are already in motion, the gears are turning, and this Kill-Dozer of health care reform is about to turn the corner on a busy street and start making metal pancakes.
And you will get what you pay for.