Archive for category Health Care Reform

MACRA Final Rule Highlights

Provided by Barbara K. Tomar, ACEP’s Federal Affairs Director

The Medicare Access and CHIP Reauthorization Act (MACRA) Final Regulation was released Oct. 14. This rule – now designated by CMS as the “Quality Payment Program”- describes requirements for physicians to participate in the Merit-based Incentive Payment System (MIPS) and/or the Advanced Alternative Payment Models (Advanced APMs). Both begin January 1, 2017.

Former ACEP President Dr. Mike Gerardi appointed an APM Task Force that is developing some models that we hope will be reviewed and approved by CMS over the next year. Work of the Task Force was overseen this past year by Immediate Past President Dr. Jay Kaplan and current ACEP President Dr. Becky Parker has pledged to continue to support Task Force efforts.

It’s important to note that since few emergency physician groups have ever participated in various CMS bundled payment models/ACOs, etc. in the past, we expect most of the members to participate in MIPS for the next year or so.

We were pleasantly surprised in our early review of the 2,200-page rule, that CMS responded to ACEP’s comments on the timing and scope of some of the new programs.

Merit-based Incentive Payment System (MIPS):

  • Reduces timeframe for reporting. Instead of reporting quality measures (much like PQRS) for a full calendar year starting in January, members can report for as little as 90 days of their choosing and avoid the 4% penalty in 2019. (Similar to PQRS, there will be a 2-year lag between data reporting imposition of bonus/penalty.)
  • Doctors can report MIPS as individuals or through their groups. However, physicians must elect one or the other for all MIPS categories.
  • Quality measures reporting reduced from 9 to 6. Either 6 measures or a specialty measure set can be selected, 1 of which must be an outcome measure; if no outcome measures are available, a high priority measure.
    • Reporting thresholds reduced from 90% of patients (or 80% for claims reporting) to 50% in 2017.
    • Encourages the use of QCDRs and electronic sources through preferential scoring.
    • Increases quality percent of composite performance score: 60 percent of the composite performance score will be based on the quality performance category in 2017, due to the (requested) reduction of the cost performance category weight to zero next year. CMS was going to weight ‘resource use’ at 10% – a nearly impossible measure for EM due to current cost attribution methodology.
    • CMS working on patient condition and patient relationship codes to improve future cost attribution. (ACEP’s recent comment letter to CMS noted that none of the patient relationship codes fit EM practice so we will continue to work with CMS to change this).
  • (Clinical) Improvement Activities reporting burden reduced. Highly-weighted activities (20 points) reduced from 3 to 2 and medium-weighted activities or some combination of both need to equal 40 points. (Use of QCDR is highly weighted).
    • Allows 90-day reporting, also.
  • Advancing Care Information (previously known as Meaningful Use) reporting reduced.
    • EM has been exempt from reporting on EHR measures and may continue to be in spite of the burden placed by the hospitals.
    • Also reduced to 90-day reporting for 2017-2018

Advanced Alternative Payment Models (APM):

  • Reduces amount of losses that APMs must bear. CMS used the term “more than nominal risk” in the draft and proposed that qualified APMs pay of to 4% of Medicare spending. The final rule is based on physician/APM revenue which would be at risk for 5% of revenue losses instead.
  • Expanded the definition to include practitioners other than physicians so that models can address quality and costs of non-physician services.

Physician-focused payment model Technical Advisory Committee (PTAC):

Note: This brief description of PTAC is included as background as no changes to its role were made in the final rule.

  • MACRA created the PTAC (of outside experts) to assist physician groups who are creating APMs, providing a first line review of proposals to determine whether such proposed models meet the criteria established by the Secretary of HHS for PFPMs and offering some technical assistance. Based on its findings, PTAC can make recommendations to CMS as to whether the model should be refined, further studied, tested or implemented, but CMS makes the final decision through its own application process.

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ACEP Reacts to Supreme Court Decision to Uphold Health Care Law

ACEP President Dr. David SeabergAs you may know, today the United States Supreme Court decided to uphold The Patient Protection and Affordable Care Act. (Read the 193-page decision here.)
This decision will impact emergency medicine because it is clear that the amount of visits to the nation’s emergency department will continue to increase even with the implementation of health care reform.
As I stated in a press release today, the nation’s emergency physicians fully support the emergency care provisions in the law, such as inclusion of emergency services as an essential part of any health benefits package and the prudent layperson standard, which guarantees that health plans base coverage on the patient’s symptoms, not the final diagnosis.
And regardless of the Supreme Court’s decision, it does not change the mission of emergency physicians — we pledge to be there for our patients.
However, while there are provisions in the law to benefit emergency patients, it is clear that emergency visits will increase, as we have already seen nationwide. There are physician shortages and there are also drug shortages and serious mismatches between patient needs and available resources.
The College will continue to urge lawmakers and regulatory agencies to ensure that the implementation of the health care reform law does not endanger patient care or threaten the practice of emergency medicine.
ACEP has worked with — and will continue to work with — members of Congress to find solutions to improve the safety and efficiency of emergency care for all Americans. Emergency departments are a critical, life-or-death part of our health care system and we need help now. This crisis in emergency care is everyone’s problem, because every person is only one step away from a medical emergency.
According to the most recent GAO report, emergency patients who need care in 1 to 14 minutes are being seen in more than twice that timeframe — 37 minutes.
Significant growth of Medicaid is intended as one of the means of expanding coverage. Increasing the number of patients on Medicaid without an equivalent increase in the number of physicians willing to take that insurance will surely increase the flood of patients into our nation’s emergency departments.
Coverage does not equal access and critical problems facing emergency patients are not going away.
A recent study in Annals of Emergency Medicine shows that crowding in emergency departments is growing twice as fast as the rate of ED visits, principally because emergency patients are showing up sicker and with more complicated health problems.
As the nation moves forward with implementing the health care reform law, we urge the Senate to follow the lead of the House in repealing the Independent Payment Advisory Board (IPAB), which was included in the law. The IPAB panel does not have any accountability to Congress, health care providers or the public and will harm Medicare patients’ access to medical care.
This law also includes medical liability dispute resolution alternatives, but that the scope is extremely limited, which limits its potential effectiveness. America’s medical liability system is broken and without true medical liability reform, patients’ access to lifesaving care will continue to suffer.
ACEP will continue to fight for meaningful medical liability reform and other emergency medicine issues. You can aid in this battle. Contributions to NEMPAC will support candidates who can positively impact emergency physicians and your patient care. Consider donating at the Give-A-shift level for maximum leverage of your PAC contribution.
Participation in the Emergency Medicine Action Fund is now more important than ever. With the Supreme Court decision upholding the law, an avalanche of regulations are being written and emergency physicians desperately need the EM Action Fund to keep them out of the regulatory and legal crossfire between payers, patients, policymakers and hospitals.
The EM Action Fund has unified the house of emergency medicine and become a powerful and influential voice in federal regulatory and legal issues that matter to you and your colleagues. Join the EM Action Fund today.

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Should Emergency Medicine be Carved Out of Payment Reform?

Should Emergency Medicine be Carved Out of Payment Reform?

Should emergency physicians advocate that they be carved-out of payment reform?  There may be no easy answer to this question, at least not yet; and in any case, advocating to be an exception to the transition from fee-for-service to pay-for-performance and risk-sharing may be a waste of time and effort.  The tide is clearly turning, though not as quickly as payers and government regulators might wish; and it would appear that eventually, every physician and hospital will be subjected to various incentives and disincentives to provide better care for less money, or perhaps less care for less money.  Even if the Affordable Care Act is killed by the Supreme Court, along with the provision of this act that mandates “paying more to doctors who provide quality care at lower cost to Medicare, and reducing payments to physicians who run up Medicare’s costs without better results”; this snowball is already rolling.  The question for ACEP and emergency physicians is:  do we scramble to get out of the way, or hitch a ride?

One of the considerations at issue is the attribution problem.  Lots of different providers impact the care of emergency department patients, and what gets done to and for them.  Unlike most physicians’ offices, the ED is an open practice.  Physicians often send their patients to the ED to get tests and procedures and treatments that the physician could perform, or order, in a lab or outpatient radiology suite, or consultant’s office.   One-stop shopping is quick, its easy, and it gets the patient out of the doctor’s office, allowing better turn-around.  Consultants call or come to the ED and order all sorts of tests and treatments, and sometimes these orders are attributed to the treating ED physician.  When physicians are financially at risk for the cost of caring for their patients, or are simply tracked and compared with each other regarding these costs; attribution is an important issue.  Under payment reform, determining how a physician’s decisions impact the cost of care involves many complicated adjustments related to the patient’s health care issues, and the roles of other physicians involved in the patient’s care.  According to Dr. Berwick, the former administrator of CMS, this “may be the most difficult measurement challenge in the whole world of value-based purchasing”.  These adjustments are even more difficult to make in an open practice like the ED, where the most expensive care is often the result of a multi-provider team effort.

Another consideration relates to the impact of payment reform incentives and risk-sharing on medical decision-making in the context of a medical emergency.  In the middle of a heart attack, do you really want your ED physician factoring in how he or she will be judged, or compensated, by how little is spent on your care; or trying to shift critical time dependent decisions to some other provider down the road?  Here’s an example:  the ED physician can look at your ECG and make the expensive decision to call in the cath lab team in order to reduce the time it takes to get your coronary artery open, saving heart muscle and maybe your life.  Or, he can call the cardiologist to come in and make that decision, wasting critical minutes, but putting the cardiologist on the hook for the cost of this decision.  Of course, the obvious answer is to make the entire team responsible not only for costs but also outcomes, which is what bundled payments, capitation, ACOs, and integrated health care systems are designed to address.  But don’t think for a minute that paying the entire team for performance is going to entirely mitigate the impact of these cost-cutting incentives.  Ask seniors how they feel about health care payment reform under Medicare: for the elderly, and most everyone, incentives for physicians to skimp on needed care is frightening.

So far, things like bundled payments and capitation have been focused on scheduled, elective, non-emergency care, because it is easier to predict and monitor the relative contribution of the surgeon, the anesthesiologist, the primary care doc, the pathologist, and so on.  In an emergency, care is less predictable, and it’s more difficult to attribute medical decision-making to one or another provider; and frankly, cost-cutting is a bit more risky, and cost-effective care perhaps more difficult to achieve.  I suspect, however, that this will not deter the payers, because emergency care is also more expensive.  If emergency care providers expect to be able to ride the train of fee-for-service forever, carving themselves out of payment reform, they will likely be disappointed.  Either they will be tagged as an expensive commodity that payers will try to work around (using the EMTALA mandate as cover, and non-payment as one of the tactics – as in the Washington State Medicaid non-payment policy), or they will be subsumed into hospital employment or mandated participation in PHOs or ACOs or other risk-sharing ventures that undoubtedly will undervalue emergency physicians’ services and undermine their current paychecks.  Unless, that is, these emergency care providers find ways to practice cost-effective care, and participate successfully in shared-savings and other at-risk incentive programs, in a responsible, caring, and efficient manner that ensures good outcomes, saves patients and payers money, and incidentally preserves their own incomes.

This post also appears in The Fickle Finger:

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Does a Visit to the ER Represent a Failure of the Health Care System?

Does this look like the failure of a health care system?

In a widely read article in the January 2011 issue of The New Yorker by Atul Gawande that details the efforts of Dr. Jeffrey Brennerto improve care to a number of high-cost patients in Camden, NJ; Dr. Brenner was quoted as saying “Emergency-room visits and hospital admissions should be considered failures of the health-care system until proven otherwise.” This observation has often been quoted by any number of health care policy wonks, health plan advocates, and politicians in efforts to justify their particular distaste for ‘unnecessary’ ER care. Like many such generalizations, Dr. Brenner’s comments are often taken out of context or misinterpreted, and in some cases have been used to denigrate the care provided in ERs, or the patients that rely on the ER. Dr. Brenner was referring to “failures of prevention and of timely, effective care” in the rest of the health care system, and I cannot disagree with him that ERs are often called upon to address these failures. Nonetheless, my antipathy for Dr. Brenner’s observation is that it is glib, and too easy to misconstrue.

Emergency Departments provide such a broad scope of services, and play so many roles in health care, that it is rather short-sighted to view ER visits as the if they were almost inevitably the result of misuse, abuse, inattention, inappropriate delay, or a failure of prevention. If someone falls off a ladder and breaks their leg, that obviously is not a failure of the health care system, unless of course you plan to hold the health care system responsible for poor ladder design. Likewise, not all heart attacks or strokes can be prevented by good primary care, Lipitor, aspirin, and exercise; and not all pneumonias represent a failure to immunize or prescribe controller inhalers for asthma. The reasons why the number of ER visits have grown so rapidly go way beyond the fact that the health care system often fails us; or that the ER is open 24/7; or the EMTALA mandate to treat everyone regardless of insurance status or ability to pay.

ERs have become the diagnostic centers of the health care system; and many patients are sent to the ER by their doctor specifically because of the broad array of diagnostic services available, ER physician expertise as ‘diagnosticologists’, the ready availability of specialist expertise, and the efficiency of ER workups. It would not surprise me if more than a third of all cancers in the chest and abdomen are first detected in the course of an ER visit. In addition, the ER fills many roles that, if they had to be met by other health care providers and venues, would render those providers or venues overwhelmed, even more inefficient, and often just unavailable. Imagine if primary care doctors, or even urgent care centers, had to repair all lacerations, or treat all kidney stones, or manage every alcoholic who drank himself into a stupor. Think what it would cost if those offices and facilities had to stay open until 2 am to accommodate those who were not able to get their care during office hours. You don’t have to imagine closing every ER in the country to realize that ER care is not just some regrettable but necessary safety net established to manage the failures of the health care system. Just watch what happens when the last ER in a community closes: you will find that ERs represent what is often the best of what the health care system offers: timeliness, efficiency, effectiveness, scope, availability, responsiveness, surge capacity, compassion, and decisiveness; and this will be sorely missed by the residents of that community.

The tendency of many to misconstrue comments like those of Dr. Brenner is reflected in a host of similar aspersions cast on the ER.  Jane Stevens also wrote an article about Dr. Brenner, and about a similar effort to reduce costs through an ER diversion program in Bend, Oregon, designed to help patients who frequently landed on the doorstep of the ER to get access to other, more appropriate places to get the things they needed, some health care related, but often focused on social service needs. The title of this article was “Improve health, lower health care costs by reducing emergency room visits”, implying that simply by blocking the door to our ERs, we could solve what is wrong with health care.  At least, this is how many readers were likely to interpret the message. Taken to an extreme, this is the kind of message that leads policy makers and legislators to believe that if they just stopped paying for ER visits, they could keep everyone healthy AND solve their budget crises.

Dr. Brenner’s linkage of ER visits to failure has also become insinuated into even the most thoughtful discussions about health care reform. Brad Wright wrote a post in the Kevin MD blog that pointed out the mistaken belief by many that universal health insurance would lead to a reduction in ER use. He noted that “people go to the emergency room for a host of reasons that have nothing to do with their insurance status. Among these reasons are low health literacy, a health care system that is often complicated to navigate and inaccessible for people who can’t get off work during typical business hours, and a lack of continuity of care that arises for a host of reasons. Waiting to be seen in the ER is no picnic, but for many people it is a more easily understood process than trying to get a referral to a specialist from their primary care physician–assuming they even have one.” As I have noted above, this accounts for just a fraction of the reasons why patients use the ER. Mr. Wright notes that consequently, reduced ER use should NOT be considered a measure of the success of health reform.

I believe that ER use is an indicator of many things, some reflecting the failures of our health care system and our social safety net; others reflecting great advances in acute care, resuscitation, and diagnostic services; and still others reflecting our society’s need for, and desire for, efficiency, availability, and timeliness of care. You can’t hope to cover all of these attributes in a single, facile observation, no matter how well intended.

This post also appears in The Fickle Finger.

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Join the Fight: Don’t Blame the Emergency Department For Everything

PhotobucketEditor’s Note: Nathaniel Schlicher, MD, JD, is the Associate Director of the Patient Safety Organization, TeamHealth and the Legislative Chairman, Washington Chapter of ACEP.

Did you hear?  “The ER physicians and hospitals have been abusing their privileges as providers of ER services for years,” according to the Chief Medical Officer for the Washington State Medicaid Program. 

These are the statements that make involvement in organized medicine and participation in leadership at all levels critical.  But where do we acquire the skills to combat these misperceptions and outlandish statements?

In May every year, there is a one of a kind event in Washington, DC called the ACEP Leadership and Advocacy Conference.  It is an intimate conference with about 500 attendees, representing leaders in emergency medicine from across the country. 

The conference focuses on principles of leadership, current issues in advocacy, media training, and practical everyday leadership challenges that will confront leaders in every state.  It is also an excellent opportunity to network with colleagues from across the country.

When I first attended 5 years ago, I went as a member of the EMRA Chair’s Challenge and the incoming Legislative Advisor for EMRA – a neophyte to organized medicine by all accounts.  It was an eye-opening experience to be talking with the leaders of our specialty.  These were the people and faces that went with the legendary names I read about in Annals and ACEP News.  Now I was talking with them, learning from their experiences and stories, and finding out how varied the opportunities were in emergency medicine. 

From chairs of departments, leaders of advocacy groups such as the AARP, AMA delegates, speakers of the council, and so many others, I had the chance to see and live the history of our specialty.  Then on the final day of the conference, we put it all together and walked up to Capitol Hill as hundreds of physicians representing our millions of patients to share our stories with elected officials and change the face of medicine.

This year it is my privilege to share with you my experience in Washington State, having put these skills into action on the local level.  When I joined the Washington ACEP Board of Directors, I never imagined I would use so much of what I learned at LAC.  From media training skills in doing press interviews and the gotcha journalism warnings, to relationships I have leaned on for statistical assistance in fighting misleading information, and the practice of speaking with legislators – these are all invaluable skills. 

If you have the slightest of desire to join the leadership of emergency medicine in your hospital as a facility medical director, at the state level in an ACEP Chapter, nationally on a committee, or be involved in one of the hundreds of other ways possible, I encourage you to attend ACEP’s Leadership and Advocacy Conference in May.  It is the conference that I walk away from every year re-invigorated and ready to take on the challenges of caring for our patients in the halls of our department, but also and more challenging often, the halls of the Legislature.  You will not regret coming to DC, but you might just regret missing it!

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The Solution to Medicaid Expansion or There’s Just Not Enough Meat on the Bone

Health Care reform proposals to cover more of the uninsured by expanding the Medicaid program inevitably stumble over several potholes and obstructions: there aren’t enough providers to cover existing Medicaid enrollees, let alone millions more; Medicaid Managed Care doesn’t seem to save enough money; states can’t afford to pay for it; the feds can’t afford to subsidize it; and most importantly, the poor don’t vote or contribute to election campaigns. Not to worry: I say with all modesty that I believe I have a solution.

Let me tell you a true story about a successful Medicaid Managed Care plan that works. If you wanted a model for such a plan, this would be a good one. Partnership Health Plan (PHP) in Northern California is one of 5 fully capitated County Organized Health Systems (COHS) in the state, covering Sonoma, Lake, Mendocino, Marin, Solano, Napa, Yolo and Sonoma Counties. It has over 200,000 enrollees, of which 31% are seniors and persons with disabilities. PHP has 240 Employees and a $700 million annual budget, and a remarkable 95% Medical Loss Ratio (i.e. 95% of funds go to medical services). Administrative costs for the Medi-Cal product (Medicaid in California) are currently less than 3.5%. PHP actually believes in managing care, they take it seriously, and they generate serious cost-savings as a result, with a 380% ROI in complex case management, and a 220% ROI on a care transitions program to reduce or prevent hospital readmissions.

PHP pays their capitated PCPs very well, and it pays networked FFS specialists better than any other Medicaid Managed Care plan in California, at rates of 120-160% of the state’s MediCal fee schedule. The plan pays claims quickly (less than 10 days on clean claims), and without relying on the typical down-coding and bundling schemes to underpay EMTALA obligated providers. PHP is so well received by providers that its network participation with the primary care and specialist provider market in its assigned counties is remarkably broad and deep. Ninety-seven percent of PCPs and specialists contracted with PHP expressed satisfaction with the plan – you just do not see this kind of thing in most Medicaid Managed Care organizations. Recently, despite California’s scheduled 10% reduction in MediCal rates and capitation payments to MMC plans; PHP decided to maintain current provider rates in order to maintain patient access to these services. So how did PHP accomplish this? Partnership Health Plan is a not-for-profit Medicaid Managed Care Plan.

All over the country, health care policy wonks have been advocating for the expansion of Medicaid through a for-profit managed care structure, ignoring the fact that there just isn’t enough meat on the bone in Medicaid programs to support quality care for enrollees, case management for the chronically ill, reasonable payment to providers, sufficient access to specialty services, and generate profits to Wall Street or equity investors and excessive management fees to overpaid CEOs. The drive for profits, and limited financial support from strapped governments, leads these for-profit plans to adopt strategies that result in provider underpayment, lost claims, selective dis-enrollment, inappropriate denials of coverage, limited access, financial insolvency, and delays in necessary care. Why are so few advocating for a non-profit approach to Medicaid Managed Care? The presumption is that the profit motive should drive creativity and cost-effectiveness, but if policy-makers fail to accurately measure access to care and quality, and only look at the cost side of the equation: it’s easy to get fooled about the value and success of government sponsored for-profit health-care enterprises. The ability of PHP to succeed in the context of such a lean, nearly meatless, Medicaid program as exists in California should cause everyone, everywhere, to reconsider the not-for-profit approach to Medicaid expansion.

This post also published in The Fickle Finger

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Value Based Purchasing of Emergency Care – Part 2 Recommendations for Providers

This is Part 2, outlining suggested strategies (dos and don’ts) for providers of emergency care who want to prepare for value based purchasing under health reform.  It is primarily aimed at emergency physicians and other hospital-based providers, but also applies to specialists providing on-call backup services to ER patients.

• Don”t assume that because your hospital’s business model is predicated on exploiting the fee-for-service payment system, and avoiding at all costs going ‘at risk’ for the care of managed care enrollees; you should avoid talking to your hospital CEO about future payment models predicated on value based purchasing of hospital and physician services.  They all know it’s coming, and they will appreciate that you are thinking about it as well.

Do consider doing your homework, reading up on VBP and payment reform and how it may affect hospital-based providers, and anticipating how you and your group will respond when your hospital begins to align its business model (and its medical staff) to the new reimbursement paradigm.

• Don’t expect to be carved out of bundled payments, utilization risk-pools, and other incentive programs to constrain costs, just because you provide non-elective services.  Once payers get a handle on how to bundle payments for more predictable services like knee replacements and cholecystectomys, they will then begin to target episodic unscheduled care for strokes, MIs, and even acute abdominal pain.

Do prepare for these payment reform eventualities by tackling one of the thorniest problems emergency care providers face in the ‘open practice’ of the ED – attribution.  Whatever system you use to order up tests, treatments, and services in the ED, you need to be able to identify, and track, whose decision it was to spend that money, and provide that care.

• Don’t assume that, just because your hospital is not involved in an integrated provider network, the CFO isn’t concerned about resource utilization.  Just about every hospital depends upon the provision of cost-effective care in order to profit from services to seniors on Medicare, which is paid on a DRG basis.

Do begin, if you haven’t already, to address your approach to the care of the elderly in your department, with particular emphasis on co-ordination of care, reducing re-admissions, communicating with nursing homes, facilitating review of complex medical records during the evaluation phase of care, and other strategies for reducing unnecessary utilization and improving the efficiency of care.

• Don’t wait for health plans or hospital medical directors to tell you how to spend less and give more and better care.  They don’t know your patients, your department, or your business as well as you do, and they will likely be less willing to invest in your success than you are.

Do consider developing some strategies for cost-effective care for current or future implementation, so that when you are asked to participate in shared savings programs and other incentives to provide quality care at less cost, you and your hospital can both profit from the opportunity.

Again, If any of you have additional do and don’t suggestions, please comment through the link below.    The Fickle Finger


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Value Based Purchasing of Emergency Care – Part 1 Recommendations for Payers

Value based purchasing is a strategy for health care financing that attempts to hold the provider accountable for both quality and cost, through a combination of reductions in inappropriate or ineffective care and rewards for those providers that are ‘the best performers’. 1 Unfortunately, most insurance plans, and employer purchasers of health care, are simply looking to reduce payments to providers, and they all but ignoring the issue of quality or even cost-effectiveness. When it comes to the purchase of emergency care, the payers really seem to have taken a wrong turn, predicated on a lot of misconceptions about the role of the emergency department and the value equation for emergency care services.

This blog is aimed at the primary purchasers of health care: the plans, employers, and government programs that purportedly aim to adopt value based purchasing as an adjunct to, or replacement for, fee for service medicine. For every ‘don’t do that’ I will include a ‘consider doing this’, because up until now many emergency care advocates have either advocated some sort of carve-out for emergency medicine, or focused on the defense of the emergency care value proposition (like ACEP’s ‘just 2% campaign‘). Emergency care providers have to become part of the solution to the cost-of-care conundrum if they hope to retain any credibility with insurers and legislators. In Part II, I will outline some do’s and don’ts for providers under value based purchasing. So, I suggest that the purchasers:

• Don”t expect emergency physicians to act as ‘gatekeepers for acute care’. Emergency physicians are trained and motivated to provide care, not deny care. Coercing emergency physicians to ‘defer ER care’ for so-called non-urgent patients by down-coding claims or denying coverage is a low-gain, moderately high risk strategy that is a distraction from pursuing more cost-effective strategies (see:

Do encourage and incent primary care physicians and clinics to provide more after hours and next-day appointments. It is better to pull patients who do not need to go to the ED into other venues than to insist that ED physicians push them out.

• Don’t punish emergency care providers through non-payment and under-payment with the expectation that it will teach patients not to misuse the ED.

Do consider assisting EDs in identifying patients who use the ED repeatedly for acute exacerbations of chronic conditions, and who could benefit from active case management starting in the ED (and compensate providers for this case management – this is a strategy with an excellent ROI).

• Don’t assume that if a patient is admitted from the ED to an observation unit, and then subsequently admitted as an inpatient; this necessarily represents ‘double-dipping’ by the emergency physician. Payment for observation services is a cost-effective way to keep patients out of the hospital, and identify patients who, if discharged inappropriately, might return later for more expensive service.

Do provide feedback to emergency care providers about the population-based financial consequences of their use of chest pain centers and observation units, so that these services can be used more cost-effectively.

• Don’t use coercive contracting of EMTALA-obligated providers as a means of achieving cost-savings: it is abusive, and undermines the financial viability of the emergency care safety net. Commercially insured enrollees and their insurance plans depend on the availability of qualified emergency physicians and on-call specialists to SAVE them from unnecessary disability and higher costs down the road.

Do consider implementing shared-savings, utilization risk-pools, case-limit rates, and other contractual incentives (with appropriate guidelines and benchmarks) to encourage emergency physicians to adopt cost-effective care strategies in the ED, when the hospital is appropriately aligned with such strategies in their financial models.

• Don’t try to undermine, work around, or revoke the prudent layperson standard through the use of ‘non-emergency diagnoses’ lists or high ED visit co-pays. This standard ensures that enrollees will go to the ED when they should, reducing avoidable delays in care that result in unnecessary long-term disability and even greater long term costs to insurers. A single case of a missed opportunity to treat a stroke can cost insurers far more than it costs to treat fifty patients in the ED whose symptoms turn out to be non-serious.

• Do focus on where the ‘real money’ is spent, that is, where the major health care costs, on a population basis, are incurred, and the real opportunities for cost-savings and quality improvement exist. No doubt the ED is one place where such opportunities lie, but at only 3% of the health care dollar, the ED is by no means the target of opportunity that it is made out to be.

• Don’t automatically down-code ED physician claims, especially E&M level 4 and 5 claims, simply because these providers have to care for your enrollees whether they get paid appropriately or not. It is also abusive, and undermines your credibility as an insurer or payer.

Do, if you identify outliers who appear to be overcoding claims, utilize medical records audits by trained coders and recognized standards of coding, to explore these apparent overcoders in depth, and offer to adjudicate these claims in a fair and reasonable process.

If any of you have additional do and don’t suggestions, please reply below.

1. Theory and Reality of Value-Based Purchasing – AHRQ

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Medicaid Managed Care Does Not Provide Better Access than FFS Medicaid for Non-emergency Care

The folks who run Medicaid Managed Care Plans often gripe about their enrollees using emergency departments for non-emergency care. And of course, they do, and probably more so than commercially insured enrollees. Most state and federal government regulators and legislators believe that capitation and managed care models for Medicaid can reduce the inappropriate use of ED services by Medicaid patients by incentives that encourage primary care providers in managed care organizations to increase access for their enrollees to extended office hours or next-day appointments for urgently needed, non-emergency care. Recently, the Obama administration decided to kill a proposed plan to use ‘secret shoppers’ to determine whether, in fact, enrollees can get such appointments when they need them, in the face of considerable opposition from these very medical-home advocates. In the ED, we constantly hear from Medicaid Managed Care enrollees who come to the ED because they could not get a timely appointment from their PCP or clinic, but anecdote is not the best evidence, and there is not a lot of recent research about timely access for Medicaid patients (I think because no one in government or health care policy really wants to know). Therefor, we must look to indirect evidence of this phenomenon.

Recently, I had the chance to review claims data from 138,129 Medicaid Managed Care (MCMC) enrollees and 107,125 Medicaid Fee for Service (MFFS) patients seen consecutively in about 65 EDs in 6 states states over the first 4 months of 2010. Using ED physician charges (all under the same fee schedule) as a surrogate for ‘acuity’, all of these claims were stratified into 20th percentiles, from highest charges to lowest, for the MCMC and FFS patients. If you think about things like ‘deferral of ED care’, the patients who might be the least likely to require emergency care would fall into the bottom 20th percentile of ED physician charges, the least ‘acute’ patients using the least amount of ED physician services. These 20th percentile groupings offered an interesting comparison between MCMC and MFFS.

Here is how the comparison looked:

Medicaid Managed Care: 41.55% of all ED visits for these MC enrollees were in the lowest 20th percentile of charges (representing 26.57% of total ED MD charges for all MCMC enrollees)

Medicaid Fee-for Service: 36.72% of all ED visits for these FFS enrollees were in the lowest 20th percentile of charges (representing 21.14% of total ED MD charges for all MFFS enrollees)

Some of this discrepancy may be accounted for by the fact that the average charge for the MCMC patients was slightly (8%) higher than the average charge for the MFFS patients, but at best what this data suggests is that MCMC plans and capitated medical groups do not provide any better access to enrollees for urgently needed, non-emergency office or clinic appointments than their counterparts providing services to Medicaid patients on a FFS plan. If this were not the case, the numbers would be very different. So much for incentives. I guess as long as these MCMC organizations and plans can continue to underpay ED providers for after-hours urgent care to under-served Medicaid enrollees and not worry about ‘adequate access’ oversight, this isn’t likely to change.

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Much Ado About Very Little – the Deferral of ED Care Boondoggle

Boondoggle – a scheme that wastes time and money. Perhaps this is not the best way to describe the many efforts that are being made to try to keep patients with non-urgent problems from using the emergency department, but from where I sit, deferral of ED care is a cost-saving tactic that not only fails to deliver much in the way of cost savings, it also is a strategy that can be both risky and unethical. More importantly, the focus on deferral of care and ‘unnecessary ED visits’ as a cost-containment tactic is a distraction from efforts that would yield far more savings at far less risk to patients, and to our fragile emergency care safety net.

Recently, I worked with one of the major health plans to look at over 637,000 consecutive commercial and Medicaid California ED patient visits over a one-year period (excluding ED patients who were admitted to the hospital). Based on the data below, it is clear that those 20% of patient visits that represented the least costly visits (facility plus professional ‘allowable payments’) accounted for less than 4% of the total cost for all non-admitted ED patient visits.

Rank            Total Allowed             % of Total Allowed
1                 $520,314,096                       54%
2                 $195,156,385                       20%
3                 $129,376,962                       13%
4                  $84,949,393                          9%
5                  $33,929,559                          4%

Remember, this data just represents patients who were not admitted (facility costs for ED care of admitted patients are bundled into inpatient payments). Thus, it is likely that the bottom 20% of admitted, discharged, and transferred ED patient visits likely represented between 2 and 3% of the total cost of care for all ED visits. ACEP has been saying for a while now that (depending on the source of the data) ED care accounts for around 2% of the $2.4 trillion spent on all health care costs. Now the estimates of the percentage of ED patients who ‘don’t need to be there’ or have ‘non-urgent’ or ‘non-emergency’ problems is a bit more wide-ranging, depending on the agenda of the estimator; and numbers as low as 10% and as high as 50% get thrown around all the time. The Rand Corporation put the number at 17%, the CDC at 8%, and HCA Gulf Coast Hospitals put the number at 40% !!! Clearly, no one seems to be able to define this group in a standardized way, but it is clear that as the poster child for unnecessary and expensive care, the ED has become the target of many attempts to reduce costs by keeping patients out of the ED, or sending them away, based on screening criteria that may, or may not, meet EMTALA standards. Much has been written about the down-sides of the deferral of ED care strategy, and ACEP has a policy that opposes deferral of care, especially when it is not accompanied by adequate access to alternative care venues and carefully designed programs to arrange for timely and appropriate care for those whose care in the ED is deferred. Most ED physicians agree that the way to reduce unnecessary visits to the ED is by improving access for non-urgent care in clinics and primary care offices. However, my issue with all the hubbub about cost-containment through deferral (or denial) of ED care goes beyond the ethical and risk issues: it simply is not a cost-effective strategy.

Let’s assume that it is possible to accurately identify and screen the patients that do not need ED care without missing the patients who really do have an impending medical emergency in the early stages of presentation, and that we could reasonably eliminate the 20% of ED visits that use the least amount of ED resources. I don’t actually believe this is possible, but let’s make this assumption. If it were, we could reduce the US health care budget by something like 3% x 2%, or 0.06%. But wait- surely some money would have to be spent caring for most of these patients in the clinic or PCP’s office. So perhaps the actual savings from deferral of ED care might amount to 0.05% of the health care budget (50 cents for every $1,000). Probably, the number is even lower. Yes, I know, it is real money, but in relative terms, they call this ‘budget dust’.

The study on ED visits in CA that I mentioned above also looked at costs by procedure and costs by diagnosis for those 637,000 patients. I was surprised to learn that renal and ureteral stones accounted for $25 million of the $963 million spent on all these patients. So, roughly, the same amount of money was spent taking care of 7,900 patients with kidney stones as was spent on taking care of the 127,000 patients who might have qualified for deferral of ED care. In fact, the data from the Anthem study suggested that we could save as much money by reducing the number of CT scans done in the ED by 1 out of 12 scans as we could by barring the door of the ED to every single one of the 127,000 patients in this study who accounted for the lowest 20% of ED costs.  My point is that all sorts of legislators and health plan executives and government regulators are screaming about, and scheming about, reducing unnecessary ED visits, and distracting us all from focusing on where the real money gets spent, and the real savings could be achieved. You want to talk about saving health care dollars: let’s look at back surgery, depression, end of life care, obesity. But no, the focus of TENCare and HCA and the Dr. Thompson’s in Washington State and elsewhere is on the ‘imprudent’ parent who takes their screaming, vomiting, febrile 2 year old child into the ED at 3 AM, only to be diagnosed with a lowly ear infection. And to top it off, the solution to this problem that many Medicaid program directors and legislators have lit upon, the best way to keep these patients out of the ED, is simply to decide, after the fact, not to pay the ED physician for having provided this care. Yep, that makes a lot of sense.

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