The New Hospital at Home Movement: Opportunity or Threat for Patient Care?

Select Key Findings Policy Issues Debating the Future: Does H@H Save Costs and Improve Patient Care? “[..] Recent studies of cost savings from H@H programs range from 20 percent (Reese 2021) to 40 percent (Brigham and Women’s Hospital in Boston, Levine et al. 2020). But these findings are not generalizable as they are based entirely on single case studies of highly structured programs involving small samples of very carefully selected patients. For example, the study of Brigham and Women’s program examined 91 adults who were admitted to the hospital’s ED and randomly assigned to the hospital vs home for treatment. [..] While … Read More

Risk Adjustment And Promoting Health Equity In Population-Based Payment: Concepts And Evidence

“[Introduction] [..] population-based payment models, as in the Medicare Shared Savings Program or Medicare Advantage (MA) program, can facilitate the resource reallocations necessary to address health care disparities. Risk adjustment is the mechanism by which payment is allocated in these models. Traditionally, risk adjustment has been conceived and executed purely as a predictive exercise. Regression is used to predict total annual per person spending as a function of demographic and clinical characteristics. A person’s predicted spending is converted to a risk score, which is applied to a base regional rate to determine the prospective payment or benchmark for that person. … Read More

Corporate Investors in Primary Care — Profits, Progress, and Pitfalls

“driven by an increasing focus on “total-cost value-based care” — a model in which health care providers are paid to manage the total cost of care for their patients and the size of each patient’s capitated budget may be increased on the basis of the patient’s health risks and the provider’s performance on quality metrics. Though potentially beneficial for certain well-insured patients, the trend of corporate investment in primary care could threaten equitable access to care, raise health care costs, and reduce physicians’ clinical autonomy. [..] As Medicare and commercial payers move toward total-cost value-based payments, such as capitation, and … Read More

Value-based payment has produced little value. It needs a time-out

“The concept of value-based payment became widespread among U.S. health policymakers and analysts during the 2000s. It collectively refers to interventions that offer doctors and hospitals financial incentives that, in theory, induce them to improve both components of health-care value — cost and quality — without generating the hostility provoked by managed care insurance companies during the HMO [health maintenance organization] backlash of the late 1990s. [The Center for Medicare and Medicaid Innovation reviewed 54 models of value-based payment. Only four were certified to be expanded:] The Home Health Value-based Purchasing Model demonstration cut Medicare spending by 1% with mixed … Read More

Value-based drug pricing: When does it work best?

“while the U.S. lags behind in adopting value-based agreements, many policymakers are realizing that value-based pricing can be an important, viable solution to the high and rising expenditures that payers lay out for prescription drugs. Developing value-based agreements has never been easier. A large number of value-based agreements are now available and can be used to help payers, manufacturers, and providers develop new ones appropriate to their specific situations. [..] Here are four scenarios for which I believe value-based pricing is appropriate. When expected outcomes for a new treatment are clear and objectively measurable. [..] Treatments with clearly defined, meaningful, … Read More

Can We Control Costs without Value-Based Care?

Like many of my colleagues in the American healthcare system, I have been alternatively hopeful and skeptical about the potential value from pursuing more value-based care initiatives in relation to our current fee-for-service model. Accountable Care Organizations (ACOs) will probably save no more than five percent of total healthcare costs. Eight years into Blue Cross Blue Shield’s Alternative Quality Contract with two-sided risk in Massachusetts showed savings ranging from 2.3% to 11.9% over three years. Bundled payments for joint procedures may save a few percent (primarily from reduced post-acute care utilization). Some have suggested Centers of Excellence to both validate … Read More

What US Medicine Needs To Do To Finally Embrace Capitation

“In 2012, there were 35,700 hospital-owned physician practices, and in 2018, there were 80,000 hospital-owned physician practices, constituting 128 percent growth. The coronavirus pandemic may actually accelerate these acquisitions due to reduced revenues for independent physician practices. [..] For consolidated health systems that include hospitals and employed physician groups, health care executives face significant pressure on finding appropriate resource allocation to cover fixed and variable costs of inpatient care while also funding alternative sites of care. Striking this balance with a fixed budget is not obvious, and health care executives may need to divest from more expensive hospital-based labor and … Read More

A Comparison of Online Medical Crowdfunding in Canada, the UK, and the US

“The growing importance of medical crowdfunding (MCF) is reflected by trends on GoFundMe, the largest social crowdfunding platform in the world. In 2011, medical causes raised $1.6 million on GoFundMe; in 2014, the amount had increased almost a hundredfold to $150 million and in 2016, more than $650 million. [..] The growing reliance of health care consumers from the US on MCF has been attributed to increasing health care costs and the lack of a publicly funded health care system. However, the popularity of MCF in developed countries with universal health care such as Canada and the UK cannot be … Read More

Rethinking Annual Deductibles: The Case For Monthly Cost-Sharing Limits

“A key contributor to underinsurance is growing enrollment in high-deductible health plans for those on the health insurance exchanges and in employer-sponsored health plans. Solutions such as consumer education, health savings accounts, and targeted cost-sharing reductions have been explored to help alleviate concerns of cost-related non-adherence to needed medical care, yet one-third of privately insured Americans report difficulty affording health care. [..] Given high health care prices, increasing deductibles (the average annual deductible in employer-sponsored insurance increased from $533 in 2009 to $1,655 in 2019), and growing high-deductible health plan enrollment (from 25.3 percent in 2010 to 47.0 percent in … Read More

A Sustainable Post-Pandemic Health Care System Needs Adjustable Payment Models

[Chernew:] I personally don’t like thinking of the payment mix as a portfolio problem because I see a whole range of broader [problems], with the fee-for-service payment writ large. Of course, I see a lot of problems with population-based payments or episode-based payments, as well. But given what happened, delivery systems are understanding that they are facing this service risk and that [..] moving to population-based payment models will give them both a little more mobility and I would argue a little more flexibility and a little more incentive to maintain and build an efficient health care system when we … Read More