Bringing it back to health care

In a break from my feminist rantings, I found this post from the Health Affairs blog (in an effort to to read other health care blogs). Frank Opelka, a professor of surgery and vice chancellor for clinical affairs at the Louisiana State University Health Science Center, discusses the problems with the way the sustainable growth rate is currently calculated, a better way that it could be calculated and the problems that would be encountered (and overcome!) in implementing his suggested system.

I'm not going to go into the problems with the SGR (see my previous post on Leavitt's blog post of the subject), but I think Opelka's endorsement of a MedPAC suggestion has merit. MedPAC suggested, as part of a Deficit Reduction Act mandate, that the government create "unique Service Category Growth Rate (SCGR) targets as well as payments based on participation in a system of care," noting, "In each proposal, the goal is to avoid the blunt, lofty economic drivers and provide physician incentives to moderate growth in volume and intensity within a geographic setting, specialty base, or system of care," i.e. regional, rather than a national, targets.

In general, when it comes to measures based on economic indicators (like eligibility guidelines for public programs), I think that regional is always better. It does not cost the same to practice medicine in middle-of-nowhere Nebraska as it does in New York City. Regional just makes more sense.

He adds a bit about incorporating quality measures into the SCGR:

These quality tools could serve as a valuable resource for regions and systems of care to promote evidence-based, efficient care. Physicians, medical groups, and hospitals will need to use the current measurements available for comparison against their peers and national benchmarks. Through payment incentives and a clinically focused approach, regional efforts and systems of care will have a greater opportunity to reach individual providers.

Concluding

The best model for modifying the SGR likely includes both regional targets and assessment of spending by specialty. The true answer lies in changing the reward system so that physicians are rewarded for collaborating and making decisions in the best interest of the patient and the overall health care system. The payment system can no longer pay blindly on volume, but must instead financially encourage providers to remove waste and promote efficient, high-quality care. The SGR is too far removed to change behavior at the individual provider level. Regional and service category proposals will bring the requirements closer to the individual, but it is important that unintended consequences be modeled in advance and offset by mandatory quality targets.

I think Congress is supposed to tackle this sometime this session, although I seriously doubt that they will (seems a bit too complicated for lawmakers to handle). But maybe next session, if Democrats can manage to win control of both houses and the presidency. Even if they don't, someone needs to tackle the SGR revision, and soon.

Leavitt on the SGR -- A Simple Solution for a Complex Problem

I'll admit it, I'm embarrassed. It's been over a month since my last post, which, although for perfectly legitimate reasons, is still unacceptable. Since it's Sunday night and I'm not at work and have no inspiration, I've turned to Leavitt's blog for a topic.

Leavitt's last post, dated Dec. 3 (he is a much better blogger than I), discusses the SGR, or sustainable growth rate, update. This rate determines how much physicians are paid for specific procedures. Because of the way that it's formulated, SGR updates actually would have been negative updates in the costs of procedures over the last couple of years. Obviously, giving physicians less and less money for the same procedure has not gone over too well for an industry with a very well-organized lobby. So physicians have successfully lobbied over the last couple of years to overturn the negative update and get a small increase. Which in turn, increases the negative rate increase for the next year.

It's a pretty sick cycle, and this year physicians are stuck lobbying against a 10% cut to their payments. That's huge. According to Leavitt,

This is a lousy system and it hasn’t reduced Medicare costs. The total expenditures just keep going up. Why? When rates per procedure don’t go up, doctors have simply done more procedures.

I think this is slightly simplistic reasoning for why the rates have increased. Nevertheless, Leavitt makes an interesting suggestion for fixing this obviously screwed up system:

Long term, the solution to this problem is to change the way we pay doctors. At least some portion of their payment should be based on how successful they are in keeping people healthy, rather that just the volume of procedures they perform [pay for performance].... [W]e cannot make progress unless doctors adopt a system of electronic medical records. Such a system depends on being able to gather quality data electronically.

What struck me as most interesting was his shift from a pay-for-performance system to EHRs. I am a full supporter of the EHR, but I'm not really sure how its adoption will lead to us correct the $200 billion deficit Leavitt earlier in the post says that we have from not reducing reimbursements to physicians. His prescription:

It is the position of the Administration that any new bill overriding the SGR law should require physicians to implement health information technology that meets department standards for interoperability in order to be eligible for higher payments from Medicare.

The connection between EHRs and pay-for-performance systems is a little tenuous. It's one thing for HHS to tell doctors to stop charging the government for their screw ups -- it's a complete other to mandate that doctors adopt costly technology or they won't get a raise. It would be completely awful to implement such a mandate without some financial assistance, especially for Medicare beneficiaries in rural areas where it's already difficult to find doctors who accept Medicare.

I guess I was expecting Leavitt to argue for a more, um, comprehensive reform. EHRs are great, and if you need to tie them to the SGR in order to ensure that they are implemented, go for it. But don't act like the fix to the growing problem of physicians payments can be encapsulated in better technology.