Monday catch-up

Happy Monday! here’s a few items you may have missed.

King v CompPartners – the California case may have implications for UR, IMR, and the “exclusive remedy” foundation of worker’s comp.

Here’s a very brief summary (see url above for more detail).

  • The underlying issue – did CompPartners’ UR reviewer do the right thing? is not in question.  The treating doc’s request was appropriately rejected as it was inconsistent with California’s evidence-based treatment guidelines.
  • However, the patient allegedly suffered seizures due to sudden cessation of the medication, and contended that the UR physician had a “duty of care” to inform the patient of that risk and recommend a weaning process.
  • The plaintiff took the case outside the work comp judicial process to civil court, where he lost.  It then went to Appellate Court, where the ruling raised this “question”: could Utilization Review be considered medical treatment, and the reviewer a treating provider?
  • This is contrary to all work comp precedent; the case is now before the State Supreme Court, which has stayed the Appellate Court’s ruling pending a decision.

Implications – talking to those who know better than I, the Supreme Court will likely reject the Appellate Court’s validation of civil court as an appropriate venue for the case, thereby reaffirming the “exclusive remedy” inherent in workers’ comp.

One issue that strikes me about this case; as the medication in question was prescribed by a physician for a condition deemed not covered by workers’ comp, why did the patient not a) pay for the medication himself or more likely b) get his health insurer to cover the script?

This would have allowed the patient to continue taking the drug and avoid the health issues experienced by the patient allegedly due to suddenly stopping the medication.

If you are in ChicagoLand and/or looking into value-based networks, read this. Really interesting piece on how a big provider system thinks about narrow networks, contracting, and what it wants to get paid for high-end services.  And will “eat” on commodities, such as MRIs for $100.

Here’s a shocker – media is all over reports on how chocolate helps athletes – even if the underlying study is pretty much nonsense. A much more important study that determined a very common spinal procedure is fraught with danger and likely counter-productive – was all but ignored.

From HealthNewsReview:

“Provocative discography” is a diagnostic procedure that’s used up to 70,000 times a year in the United States at great cost to the health care system. It’s commonly performed on patients with so-called “degenerative disc disease” who are considering spinal fusion surgery — a $40 billion per year industry”

If you have to rely on MCM to hear about critically-important research, there’s something really wrong with the mass media.

Looking forward to NCCI next week; will be on a panel moderated by Peter Burton with Mark Walls and Bob Wilson discussing regulatory issues.

Hope to see you there.

The impact of provider consolidation

Hospitals, health care systems, large multi-specialty groups – all are getting bigger by buying each other, merging, or snapping up smaller hospitals and physician practices. Providers smart/fortunate enough to be inside these mega-systems enjoy pricing power, strong brand recognition, and the negotiating leverage that goes with that.

Deal sizes are getting exponentially larger; a study by Deloitte indicates the average deal was $42 million in 2007.  Six years later, the average transaction was more than 4 times larger. Two were over $4 billion, and that was way back in 2013.

Last year, 940 transactions closed at a total value of $175 billion.  And it’s not just the mega-mergers that are influencing care delivery and pricing.  Small, “under-the-radar” deals are proliferating as those on the outside increasingly scramble for the crumbs.  Providers unable to join the big plans are pursuing out-of-network services, servicing smaller insurers, and trying to figure out how to remain viable.

Chicago is one such market; already quite consolidated, two of the largest systems, with over 6000 medical providers between them, are fighting to merge despite the Feds’ efforts to keep them apart. These mergers are increasingly coming under scrutiny from both federal and state regulators, as evidence suggests costs in “consolidated” regions are higher than in non-consolidated areas.

Meanwhile, DuPage Medical Group hasn’t been sitting by, closing 16 transactions that doubled it in size to 500 doctors. According to the NYTimes, “many of its acquisitions barely register — eight specialists last month, two small physician groups in February, a handful of doctors joining at a time. But it has been enough that DuPage now has ambitions of going national. Late last year, it teamed up with a private investment firm to provide it with $250 million for its goal.”

This is common everywhere; from Boise to St Louis to Boston to North Carolina providers are joining together, shifting the map or providers from one of thousands of tiny dots of ink to ever-growing Rorschach blotches.

What does this all mean for work comp?

Work comp is a tiny but very profitable line of business – so networks have limited bargaining power.

Prices are considerably higher in highly-consolidated regions; payers that don’t have contracts with the mega-systems must rely on non-contractual ways to address prices and utilization. This is particularly true in the South.

Where your patients get their care matters; a visit to a hospital-based provider costs about twice what the same visit to a privately-employed physician. Employer direction, soft-channelling, and variations thereof are key.

Tracking prices is key; make sure your internal analysts and external vendors are on top of the latest information on service prices.

Most importantly, factor outcomes into your evaluations.  Often the lower cost provider also delivers better outcomes; less use of opioids, better surgical results, faster return to functionality.

This last is key; price is easy to track and report. Outcomes are not.  Yes it’s hard; and yes it’s vital.

 

 

Health insurance, DOS, and Apple

Between a seeming inability to design a benefits plan that fits on one sheet of paper, a refusal to actually explain those benefits in terms normal humans can grasp, network arrangements that only a provider relations expert can understand, and a “explanations of benefits” that are dense and stuffed with jargon, health plans are way out of touch with consumers.
It doesn’t have to be this way.

If there’s one service that should be simple, easy to understand, and approachable for everyone it is health care.  What do I pay, where can I go, who do I have to call.

Health plans could learn a lot from the computer industry.  We old folks remember when only pocket-protector-people used computers; remember those big rooms with rows of metal boxes fronted by blinking lights and whirring tape drives? Those blue boxes were connected to green screens in the sea of cubicles outside the “computer room”, screens with horrible resolution requiring users to know what each of the dozen(s) of Function keys did and why.

The geniuses at Microsoft made computing much more user-friendly with Windows – and the PC industry exploded.

Then Apple got serious, designing their hardware and software around the non-nerdy user.  Macs were simple enough for schoolkids to use, and eventually even their parents got comfortable with Macs and PCs.

Now it’s smartphones, Siri, and google maps.  We don’t have to know anything about programming, or APIs, or backslash v frontslash.  The technology does it for us.  And “it” is pretty much everything.  We know the weather in Philly, score of the hoops game, whereabouts of our kids, monthly sales figures, meeting schedule for next week, and anything and everything else – instantly and in a format we grasp intuitively.

Which leads us back to health care.  Insurers and health plans need to take a lesson from Apple and Google; people want good health care that’s easy to access and fits their unique needs. They do NOT want to wade thru fine print stuffed with SAT-test words and jargon that’s murky at best. Blaming the consumer for misunderstanding a benefit plan is just nuts; write the plan so it’s understandable for everyone.

Give them the tools they need to use your health plan, tools that adapt to the consumer and their situation.  Tools that are intuitive, accurate, and user-friendly.

It’s long past time to scrap the “green screen” approach to health benefits.

What does this mean for you?

Some health plan(s) will figure this out.  And they will do very, very well.

Rx Drug Abuse Summit – key takeaways

I’ll keep this short.  Heading home from Atlanta and an incredibly disturbing Rx Drug Abuse Summit.  A few key takeaways.

  • The increase in the prescription opioid death toll is terrifying.  These are drugs ONLY AVAILABLE WITH A DOCTOR’S PRESCRIPTION.
  • cdc-us-overdose-deaths-2014_jr-2
  • Heroin is getting even worse – driven largely by the rampant over-prescribing of opioids.  75% of heroin users started with prescription opioids.cdc-us-overdose-deaths-2014_jr-5
  • We are making progress.  Lots of different approaches, very passionate people, truly impressive effort by the Feds.
  • There’s disagreement around the margins, but not with the central issue – opioid abuse is an unmitigated disaster.

The net is this.  There are far, far too many docs writing way more opioid scripts than they should.  Tens of thousands of people are dying, families are destroyed, kids left without parents.

You want to talk about treating pain?  

How about the pain of kids without parents, moms without daughters, sisters without brothers, communities without hope.

Who is treating their pain?

and who is causing it?

Obama, Pew, Landers and Paduda

Headed to Atlanta for Operation Unite’s fifth Rx Drug Abuse Summit, an event I’ve been privileged to participate in every year (this year Mark Pew of Prium, Michelle Landers of KEMI, and I are going to discuss formularies in work comp, an issue near and dear to my heart).

This year, President Obama is also speaking.

Think about that.

The leader of the free world is taking a day to fly down, talk, and fly back.  It’s not like the guy has nothing else on his plate – the Middle East, Apple v FBI, global warming, Congress, SCOTUS nomination of Merrick Garland, Pakistan, Iranian cyber attacks, China, trade policy…

and yet Pres. Obama a) decides to go to Atlanta; b) does the prep work necessary to speak on a panel about opioid policy, the FDA, drug approvals, law enforcement, heroin, treatment v incarceration; c) make the trip with all that entails; and d) speak on the panel.

While I’m pumped he decided to make the trip, I’m equal parts disheartened that the President of the United States has to do this.  Moreover, there’s a really impressive list of speakers; Governors, Congresspeople, the US Surgeon General, head of the FDA, Senators, head of the DEA, the CDC Director…

Those of us who’ve been up to our eyeballs in the crisis for a decade are gratified indeed to see the level of attention focused on the issue, and sad beyond measure that this has risen to the level that the President is devoting this amount of time to opioids.

What does this mean for you?

I’d suggest we focus on the positive here, as the negative is just emotionally crushing.

The Opioid Pendulum Swings

The CDC guidelines are out, and that’s a very, very good thing.

Yes, there’s an apparently-reasonable argument that the guidelines’ basis is not sufficiently evidence-based to stand up to the most rigorous standards.  There are two reasons that argument fails.

First, opioid advocates, manufacturers, and most prescribers did not worry about “evidence” when pills by the bucketful were prescribed and dispensed to anyone who presented with a sore back.  For advocates to caterwaul about science, evidence, and a lack of randomized controlled trials lasting more than 12 months is unfair at best.

Second, opioids kill more than 24,000 people a year – likely a lot more.  Mothers, daughters, sons, brothers, fathers are dying every day, causing destitution, devastated families, and disaster for communities. The time for half-measures is long past.

I understand this may lead to a few folks who ostensibly “need” opioids not getting their pills quickly or in the volume they desire.

Ask yourself this – how does this “need” stack up against the deaths, ruined communities, and parent-less children caused by rampant overuse of opioids?

I’d imagine the parents, siblings, and friends of those killed by opioids would be only too happy to wait a while or take another drug or try exercise or…

 

Health care delivery varies a LOT – and there’s your opportunity

So, medicine is a science right?

If it is, then the delivery of care should be consistent across the country for patients with identical conditions, right.

Absolutely not.

That’s the quick takeaway from a terrific panel this morning at WCRI; below is the detail.

I’ve long been intrigued by the huge variation in medical care delivery across geography – why medical care for identical conditions for the same type of patient varies greatly from place to place is pervasive, fascinating, and, more to the point, driver of low quality and high cost care.

Dr Jon Lurie of tjhe Dartmouth Institute for Health Policy is one of the nation’s leading experts on this issue.  I’ll get right to the big finding –

There’s tremendous variance in “preference and supply-sensitive medical care” across hospital regions, defined as medical care for procedures such as vertebroplasty, spine surgery, total joint arthroplasty, and, in reality, most musculoskeletal procedures.

The most gross example is vertebroplasty, which varies by a hundred-fold.

That’s right, if you live in one area, you may be 100 times more likely to get this procedure than in another area.

Frequency of the medical procedures done in work comp varies widely across the country, and even within states.  Discussing one type of procedure, authors of a study found; “orthopedic surgeons’ opinions or enthusiasm for the procedure was the dominant modifiable determinant of ara variation.”

In English, doctors’ opinions and enthusiasm – not science, evidence, or outcomes – greatly influences what procedures get done how often.

Shockingly, reimbursement also affects procedure usage.  Washington and California have very different approaches to spinal fusion due to regulatory influences, with WA regulating the procedure much more tightly.  As a result, in WA, costs are lower, outcomes much better, there are far fewer spinal fusions, and the surgeries that are performed are less complex.

Yep, costs are lower, outcomes are better – and, not coincidentally, patients are much better served due to WA’s widespread use of evidence-based medical guidelines.

Next up was WCRI’s Dr Oleysa Fomenko – who got everyone’s attention with the opening statement “why are injured workers in one state three times more likely to get surgery than workers in another state?”

Key takeaway – in general, the higher the rate of surgery in group health, higher the rate of surgery in WC.  So, a payer can look at Medicare data and get a fairly accurate picture of what they can expect to see among their work comp patients.

However (there’s always a however), states that pay really, really well for surgery for work comp patients have a lot more surgeries than one would expect.

Alas, the Land of Lincoln is, once again, our poster child for bad outcomes – the work comp surgery rate is 2.5 times higher than one would expect, due perhaps to the $11,000 higher reimbursement for the procedure in IL vs the other study states.

NCCI’s Barry Lipton led off the panel with a discussion of cost variation across six states, using a methodology that took out fee schedule variations. The takeaway – costs for initial care for knee injuries varied by 71% across the six states, with KY CO and IL well above the other three (MD IN MO).

For knee injuries, one of the differentiators is, not surprisingly, utilization – with MD IN and MO exhibiting low utilization.  Utilization of surgery and physical medicine [PM] are the primary drivers.  There are also differences between and among the high-cost states. KY has much higher surgical costs, with IL spending a lot more on PM.

The other differentiator is the cost associated with diagnoses; cost per diagnosis varied widely across the study states.

Across the three high cost states, surgical utilization accounts for 35% of the cost compared to 23% in the low cost states; in contrast diagnostic imaging accounts for 32% in low cost states and and 24% in high cost states (other cost areas are pretty similar).

That said, looking at elbows and knees, most of the interstate variation is due to surgical and PM utilization AND how specific conditions get different treatment in different states.

For those patient and nerdy enough to make it this far, give yourself a new pocket protector as a reward.

What does this mean for you?

Medicine is a lot art and varies widely, and therein lies the problem – and for smart payers, the opportunity.

 

Health care spending up 5.3% in 2014

Health care costs accounted for 17.5% of GDP last year after a 5.3% increase in spending. 

The overall spending increase, which followed 5 years of relatively low inflation, was attributed primarily to the addition of 8.7 million people to the rolls of the insured in 2014.

Health Affairs reported the biggest jump was in pharmacy costs which increased 12.2%, driven in part by Hepatitis C drugs including Sovaldi and Harvoni, both manufactured by Gilead. The big increase came despite a rise in the generic dispensing rate to 81.7 percent, up from 80.1 percent in 2013 and 77.3 percent the year before.

Total pharmacy costs were just under $300 billion with Hepatitis C drugs accounting for $11.3 billion in total spend.

Other goods and services also saw increases:

  • Hospital costs accounted for $972 billion, an increase of 4.1 percent. This was little changed from 2013’s 3.5% trend.
  • Physician and clinical services rose 4.6 percent to just over $600 billion.  The increase was due to a major jump in Medicaid expenditures.

Looking a bit deeper, Health Affairs broke down the cost increase to separate out the effects of price, demographic, and utilization:

Of the 4.5 percent increase in per capita health spending in 2014, changes in the age and sex mix of the population accounted for 0.6 percentage point, medical price inflation accounted for 1.8 percentage points, and the change in residual use and intensity accounted for the remaining 2.1 percentage points.

Interestingly, private households didn’t see much of an increase in costs; the report indicated a rise of less than 1.5%.

 

ICD-10 codes you could not make up

Courtesy of good friend and esteemed colleague Alex Swedlow of CWCI, I give you the new diagnoses you do not want to appear on your medical chart.

(For a serious review of ICD-10 and workers comp, click here for CWCI’s analysis)

First up, the tragic Y93.D1: Accident While Knitting or Crocheting. Note, needlepoint and lace-making are separate and, well, distinct.  One wonders what kind of injury…burnt lip from ingesting overly hot Earl Gray?  

Known colloquially as the “Lincoln Diagnosis”, I give you Y92.253: Hurt at the Opera.  I know, technically not an opera, but hey, close enough!

Here’s one that doesn’t sound so fun – V97.33: Sucked into Jet Engine.  I think I saw something like that in an Indiana Jones movie…but it may have been a propeller, so…never mind! 

Among the candidates for most unlikely code ever to appear outside of a blog, I present V91.07:  Burn Due to Waterskis on Fire.

From Adam Fein, a candidate for the coveted “developed after coders read The Martian” award – V95.44 (“Spacecraft accident injuring occupant”)

Then there’s this, which makes one wonder if even the ICD-10 coding geniuses thought there could be a sequel – W56.22: Struck by Orca, Initial Encounter. 

From there to something that we kinda sorta always knew in the back of our heads was definitely a medical problem, but now we KNOW it ’cause there’s an actual code! Z63.1: Problems in Relationship with In-Laws.  

Our oldest daughter is getting married next summer…I’m hoping this isn’t prescience…

Steroid injections – they kinda sort work some of the time…

Thanks to Steve Feinberg, M.D. for forwarding a study on epidural steroid injections.

Here’s the brief findings:

Epidural corticosteroid injections for radiculopathy [pain radiating from the spine] were associated with immediate reductions in pain and function. However, benefits were small and not sustained, and there was no effect on long-term surgery risk. Limited evidence suggested no effectiveness for spinal stenosis.

In a follow up, Dr Feinberg provided this:

I have a 68 year old physician colleague who is highly functional both at work and recreationally. He has rather severe cervical and lumbar degenerative disease and stenosis and a very damaged left knee. He has undergone a number of injections (more than would be allowed via EBM) and takes Vicodin 10/325 3 times a day and uses some oxycodone for “breakthrough” pain. He lives on 5 acres and takes care of 10 horses and the property. He told me that working on his property makes him hurt more but that he is not going to stop being active just because of the pain/discomfort. He has been on the same opioid dose for years and has no obvious negative side-effects. He told me that without his medications, he would have trouble practicing as a physician and he certainly would not be active on his property.

Dr Feinberg closed with:

“I ask myself everyday if so little works, what are we left with to treat?”

A colleague of the good doctor provided this as well: “Could it be that Osler’s words from over a century ago continue to direct our best efforts? “The job of the physician is to entertain the patient while nature takes its course?”

I bring this to your attention as a reminder to all that medicine can be as much art as science, that we often don’t know what works for whom why and when and how.

However, make no mistake that treatment can and should be guided by evidence-based clinical guidelines. There should be a way to navigate the care management and authorization process to allow Dr Feinberg’s colleague access to the treatment that works for him, just as there should be a high standard for approval of “non-standard” care that puts patients at risk.

I’d close with this note – there is far too much use of procedures similar to ESIs, and far too little challenging of that use.

What does this mean for you?

Promote EBM, and ensure your authorization processes work well.