0 Medicares Expenses Increased by 0 4 Really And Its All Because of the Affordable Care Act

If youre the head of Google and you want to teach about the internet, North Korea is a swell place to visit.  If your goal is air travel safety, the 787 Dreamliner is the plane for you.  If you would like to get the puck from an opposing professional hockey player, saying "please" helps.  And if Medicare costs dip, the Affordable Care Act (ACA) obviously deserves the credit.

Writing on an HHS website, Richard Kronick and Rosa Po announce that 2012 Medicare expenditures per beneficiary grew only by 0.4% over the 2011 baseline.  They credit the ACAs value-based payment (VBP) system, attacks on fraud and abuse, reduced payments to Medicare Advantage plans, cutting hospitals payments and "innovation."

The Disease Management Care Blog isnt too sure about that.

1. This Kaiser Health News article notes the VPB program withholds 1% of hospital payments and uses that fund to award bonuses in what is really a zero sum game.  And this Health Affairs article suggests the overall financial impact of VPB on hospitals is quite minimal anyway. 

2. While there have certainly been some big fraud and abuse busts, theres plenty of reason to still be skeptical about the ability of Medicares ossified bureaucracy to catch up with the sophisticated criminal enterprises that are routinely fleecing billions from the U.S. taxpayer.

3. As for the one-time payment cuts to providers and insurers, the DMCB is confident that theyll figure out ways to get their money back.  They always do.

4. The innovations are in demonstration phase.  Its too early to tell.

In addition, the DMCB is surprised that Medicares 2012 insurance claims were ready to be rolled up and quantitated in early 2013. Check out this telling quote from the website:

"2010 and 2011 statistics are calculated on a calendar year incurred-basis. 2012 statistics are calculated on a fiscal year cash-basis, because calendar year incurred-basis data are not yet available." (bolding from the DMCB).

Last but not least, the DMCB believes the lackluster economy has probably had the biggest impact on consumers willingness to use their Medicare benefit.  While Kronick and Ro state" Medigap" insurance benefits have protected the beneficiaries from the financial pain of Medicares out-of-pocket expenses, the expense of using a hospital or seeing a doctor is more than the sum of all those medical bills.

Is the DMCB being too skeptical?  Perhaps, but this particular HHS spin is built on assumptions that are backed by associations that are biased by partisan loyalty.  Taxpayers deserve better.

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0 The Non Surprise of Increased Physician Referrals

Big deal!

News flash! 

In the last century, American derrieres have grown by 5%! 

In the last 20 years, rates of professional athlete misbehavior have skyrocketed! 

And in the last 10 years, theres been a near doubling of physician errals!  

If these trends surprise and amaze you, you may want to check out the up-to-the-minute news outlets like The New York Times "Prescriptions Blog."  On the other hand, regular readers of the Disease Management Care Blog may not need to go to such extremes. They are astute observers of backsides, know how to access ESPN and can confidently predict trends in health care utilization.

That being said, the DMCB thinks a recently published article on physician errals may be worth a look.

Michale Barnett and colleagues extracted physician survey data on a sample of clinic visits from 1999 to 2009 that had been collected by the National Ambulatory Medical Care Survey and National Hospital Ambulatory Medical Care Survey.  Physicians were asked about their type of practice setting (employed vs. physician owned), their patients demographic variables, reasons for the visit, diagnosis, treatment and disposition, including whether or not there was a erral to another physician.

The study found that the rate of errals increased from 4.5% of visits in 1999 to 9.3% in 2009.  This increase included Medicare patients, who went from 4.2% to 9.7%.  Physicians who owned their practices were less likely to er (from 4.2% to 7.5%) and physicians with more than 50% managed care experienced an increase from 5.5% to 8.7%.

In the Discussion section of the manuscript, the authors point out that two possible explanations for the increase in errals include 1) the increasing complexity of health care and 2) the benefit of off-loading some of the work of patient care onto another colleague.

The DMCB agrees and would add two more explanations:

1. The increase in "PPO" vs. "HMO" style managed care during the period of study, and

2. An increase in patient consumerism.

Can recent health care orms, like ACOs, reverse this erral trend?  While the DMCB awaits the answer to that question, it looks forward to the continuing roominess of its movie theater seats and the next juicy sports scandal.

Stay tuned!

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