Wednesday, July 27, 2016

The Mystique of Medicaid Expansion

Imagine 100% of Americans covered by insurance across private insurance and Medicare and an expanded Medicaid across all US locations. Would this be a great boost to health care in the US or not?

Many would jump for joy at 100% insurance coverage. But the reality for health policy always remains the same. There are always winners and losers. Rather than a blatant promotion of expansion, more important is to understand who would win and who would lose?

The current situation in Medicaid makes the answer quite obvious. Those providing the lowest paid services at the current time would remain the lowest paid - primary care, geriatric primary care, mental health care, basic services, cognitive services, office services. Despite 100% insurance coverage, the payments for these services would be insufficient to hire the team members and support the care needed, because payments are below the cost of delivery.
Expansion Requires Expansion and Subtraction Is Contraction

A decent business executive would indicate the need for 30% revenue above the cost of running the business. This would be considered a minimum for the establishment of a new business. Health care with its ebbs and flows and uncertainties would require at least this 30% margin. A minimum of 30% would also be a requirement to attract investors, pay and train workforce, and establish a business.

The fact remains that Medicaid does not allow primary care and especially complex costly primary care to survive. The consequence of doing business with Medicaid payers is payment too low in addition to delays and denials and other cash flow issues. A financial design that does not sustain care is a design that prevents expansion of care. Insurance expansion is not the same as access to care.

The hundreds of thousands in additional costs for each primary care physician 
to address past and present ACA regulations 
can only subtract from the benefit of any insurance expansion.

Medicaid prevents hiring and supporting more team members to see more patients in more places. In other words, the designs of US health care prevent true reform - expansion of access, expansion of primary care, expansion of mental health, expansion of care where needed where Medicaid and Medicare patients are concentrated.

Expansion Winners - The benefit of Medicaid Expansion would go entirely to those paid better in Medicaid with those paid worse suffering - with or without Medicaid Expansion.

The mystique of Medicaid Expansion will continue 
until the reality of payment too low for the cost of delivering care 
via Medicaid is understood as the major problem.

It is actually quite difficult to believe the number of leaders and "experts" who are deceived by expansion rhetoric. Yes, the regression equations demonstrated benefits for locations and populations with higher levels of insurance coverage - but you can also demonstrate dozens if not hundreds of other variables with the same relationship and with much better relevance for care and care outcomes.

The Solution Was Payment Expansion Not Insurance Expansion 

There are 2621 counties spanning the breadth of expansion and not expansion that have lowest concentrations of physicians due to lowest payments and due to dependence upon Medicare, Medicaid, lowest paying plans, and lowest paid basic physician services. Mental health is also lowest paid. Health care outcomes are impaired by lowest across education, income, health literacy, and local resources as well as high complexity and difficult situations.

Many of these counties actually had good levels of insurance coverage before ACA because of high proportions of Medicare and Medicaid. The problem was not insurance coverage. The problem was lack of access due to insufficient workforce due to Medicare and Medicaid payments too low.

The Great Irony of Expansion

With Investment - During the 1970s design with increased payments, facilities and practices were afford to care for patients without insurance because they were caring for Medicare and Medicaid patients.

Without Investment - During the 2010s, providers where care is needed cannot afford to care for patients with or without insurance because of high proportions of Medicare, Medicaid, and other low paying plans and patients.

Before and After ACA

Another problem of ACA is funding taken away. Before ACA, many facilities where care is needed received disproportionate share funding - a recognition of high levels of low paying plans and no paying patients. After ACA, these funds were taken away. ACA creates winners and losers, depending upon where dollars were cut. States create losers where payments are lower - with or without expansion.

Note also the recent lawsuit settled by CMS that indicated too little was paid using underestimates of the numbers and overestimates of those who had some payment.

After ACA, small hospitals are still closing at 1 per month and small practices are being forced out due to lower payment, higher cost of delivery, and declining productivity due to ACA.

Will Red States Benefit with Expansion

Which era in history are we talking about? Red states were once Blue states prior to Civil Rights laws. President Johnson knew what would happen from Blue to Red when he signed the Civil Rights Bill. Red or Blue matters little where people have highest poverty and the most people concentrated together on Medicare and Medicaid plans. It is not a surprise that these locations have problems as they receive the least education and health and other payments by national design.

Regardless of expansion for or against or political party or health policy expertise, real reforms are needed in cognitive payment plus real decreases in cost of delivery to hope to expand access to care.

Recent Posts and References 

Rallying One Hundred for Health Access Not MACRA


The Ultimate Government Health Care Paradox - Government must facilitate better EHRs and better health access, not prevent them.

Government Compromise of Trauma Response
No Positive Spin for the Innovator Tailspin - more claims for innovation successes are apparently attempts to hide failure
Stop the Promotion To Restore Mental Health Access - claims of mental health care reforms or improvements are a stark contrast from the reality of lowest payment, highest complexity of care, unreliable payment, and poor support other than lots of rhetoric





Primary care can be recovered and should be recovered, 
but cannot be recovered when moving the wrong directions

Robert C. Bowman, M.D.        Robert.Bowman@DignityHealth.org

The blogs represent the opinion of the blogger alone.
Copyright 2016

Monday, July 25, 2016

A Few Hundred Million More is 8 Billion Less for Primary Care

A few hundred million more dollars for primary care is small change compared to 8 billion dollar annual increases in the cost of delivery.

The various ACA and CMS proponents have been feasting on JAMA articles by CMS and President Obama. Primary care advocates hoping for any good news also pass around these pieces despite what the real message is about. It is important to read the fine print. Rather than the promotion of the new math, we need more who can calculate the damage being done to access and to primary care delivery capacity year after year for decades.

Primary care is about people taking care of people. The main cost of delivery of primary care should always be the cost of the employees that deliver the care. The design of primary care should add more support for the team members that deliver primary care. The innovative designs have found ways to subtract from care delivery.

Primary care delivery capacity is about the magnitude of support specific to primary care team members. It is quite obvious that the real story past, present, and future is not addition. MD DO NP and PA streaming away from primary care across selection, training, and years of practice has long been enough evidence of compromise.

New math may claim that the addition of insurance coverage adds to care, but adding more patients to lowest paying plans paying below cost of delivery is quite obviously not the solution for insufficient primary care delivery capacity.


Why would anyone believe that paying less for primary care
and paying even less where care is needed
plus compromise of the small practices where care is most needed
would add up to anything other than health access failure?


Primary care stories are about subtraction

  • The subtraction of funding cuts, delays, denials, and lack of payment - There is no funding increase planned for primary care. At best there is a rearrangement of existing funding.
  • The subtraction of increased cost of delivery - No funding increase plus increasing cost of delivery subtracts from primary care delivery capacity
  • The subtraction of productivity loss - There is also a productivity loss involving hundreds of hours a year that physicians, physician assistants, and nurse practitioners (the MD, DO, NP, and PA that choose to remain PC) must spend to address paperwork (electronic paperwork, Health Affairs).
  • The subtraction of morale and motivation to deliver primary care - After spending more time before and after practice to address the paperwork, it is difficult for clinicians to care for patients in the way that they feel patients should be cared for. The subtractions include loss of the will to practice, loss of the ability to practice independently, or loss of the will to practice primary care at all.
  • Subtracting small practices is a poor choice to address access as the small practices are the most important when remaining viable to practice
It is obviously difficult for payers, politicians, and pundits with short term members to understand the changes

  • from good payment prior to 1980 (with much lower cost of delivery) that allowed Medicare and Medicaid payments to expand care to cover those with low paying or no insurance
  • to the cost cutting years of the 1980s with more rapid increases in the cost of delivery
  • through the short years of slightly better pay in the 1990s
  • to the rebound against primary care plus higher cost of delivery with less ability to care for patients without insurance or with low paying insurance
  • to the current stagnation in pay with accelerating cost of regulation and other costs of delivery with patient volumes too high and inability to care for low pay or no pay patients.
Isn't it ironic

  • that insurance coverage expansion is accompanied by the inability to care for patients in need of care?
  • that high volume in health care is considered abusive in physician practices but is important for access to care in primary care? Sadly the impacts of declines in payment, marginalized margin, and productivity declines are not seen as impairing access.
Could it be that the fervor to flatten physicians has resulted in little more than flattening primary care, mental health, and basic services paid least by design?


Government and Insurance Payers Face 3 Basic Choices

  • to support primary care more with additional funding (avoided for decades),
  • to choose to cut specialized or hospital care and shift funds to revalue primary care team members (best choice),
  • to choose to allow cuts and compromises to continue as since the 1980s
The last choice has been the best slippery slope choice to keep the steady declines in primary care, in mental health, in access, in continuity of care, and in are where needed under the radar.

Meanwhile this gives politicians, associations, and foundations free reign to claim new solutions for all of these areas - solutions impossible due to the subtractions of cost of delivery relative to stagnant funding.

The Case Against A Few Hundred Million More

Even though CMS, HHS, and President Obama indicate "more pay" for primary care practices, there is actually less on the way. Substantially more is being taken away in cost of delivery and productivity loss while very little is being added. Adding also costs more time and money and delivery distraction.

Small change is small change

Primary care was held hostage by the previous payment design and MACRA allows only small increases less than 1% annually and far below increasing cost of delivery. Other specialties have many routes to escape cuts and small increases by focusing on higher paying codes or different locations.

Since primary care has only a few office codes/cognitive services, there is no way around lowest payments remaining lowest.


CMS may send more to various demonstrations and grants compared to what is paid out in increases - and these grants and demonstrations are not specific to care delivery.

A few hundred million more in various "increased" payments is a tiny portion of the 150 billion a year spent on primary care.

Does the term strung along come to mind?

But the Real Story is not Addition, the Rest of the Story is Subtraction

The few hundred million in "additional pay" or grants or demos widely promoted by CMS and dependents is a stark contrast from the bleak reality facing primary care as indicate by another 8 billion dollar loss due to the increase in the cost of delivery ($40,000 per primary care physician for quality metrics, Health Affairs)

Mental health is also failing due to lack of cognitive payment design reform. Failure in primary care is also failure in mental health. Overburdening primary care used to do 46% of mental health and now has a 50% share. This indicates that the most cognitive and complex services may be compromised the most.

Don't expect help from the Mental Health

The Subtraction from Primary Care Could Not Come at a Worse Time

Primary care
  • Needs to be expanded above the current annual limit of 500 million primary care visits as set by inadequate primary care payments
  • Needs to be expanded in places of need with half of the workforce concentration due to payment deficits (worsening cost of delivery worst where care is needed is a worst case scenario)
  • Is increasing in demand due to demographics such as more people and rapid increases in the elderly and patients with high complexity
  • Is increasing in complexity due to the additional requirements of integration, coordination, and outreach (and at a time when communities are facing cuts in resources applicable to health)
  • Faces significant productivity problems due to poor morale, adjustment to rapid change, and burdensome EHR requirements
  • Faces turnover of staff, team members, and clinicians due to changes in the workforce and payment insufficient to the challenge
How can you retain in primary care when all other positions for MD, DO, NP, PA, RN, and other team members pay better?

Payment = retention = continuity = outreach = coordination = social determinants
Primary care change that matters is specific to more team members and requires a 30 billion dollar boost (20%) just for the team member component to attempt to deliver the care.

As with the 1990s "reforms" the lack of primary care delivery capacity substantially negates the health reform result. Note for example that poor Medicare, Medicaid, Metallic payments negate the impact of health insurance expansion.
President Obama promoted the "proven health reform ideas" of ACA in his JAMA article but avoided discussing winners and losers - the result of all health policy changes. Not mentioned in his article were the words primary care, community, rural, underserved, access, cognitive, integrate, and outreach. These appear to be the loser areas - areas I consider most important for true health care reform involving improved access, improved distribution of workforce and the economics of health care spending, reducing divisions caused by health spending, and improving the true shaping forces of health outcomes - social determinants, behaviors, environments, and other patient factors - factors ignored by CMS resulting in the aberrant designs. Also not mentioned were accelerating administrative and non-delivery costs, productivity and morale changes, and decreasing competition due to mergers of health corporations, insurance companies, systems, hospitals, and practices. Local care is losing and megacare is winning - by design.


To understand US health care, one must understand the pecking order as seen in payments




  • Highly specialized dominate over basic services
  • Procedural services rule while cognitive and interactive are marginalized
  • Care for higher income, most advantaged patients is most valued while care for most Americans falls behind
  • Urban dominates and rural falls behind by health and many designs for funding distributions across health, education, jobs..
Cuts in care can be avoided or minimized by those at the top of the pecking order. Those at the bottom face closure, compromise, and worse impact of rapid changes.


Recent Posts and References 

Rallying One Hundred for Health Access Not MACRA


The Ultimate Government Health Care Paradox - Government must facilitate better EHRs and better health access, not prevent them.

Government Compromise of Trauma Response
No Positive Spin for the Innovator Tailspin - more claims for innovation successes are apparently attempts to hide failure
Stop the Promotion To Restore Mental Health Access - claims of mental health care reforms or improvements are a stark contrast from the reality of lowest payment, highest complexity of care, unreliable payment, and poor support other than lots of rhetoric





Primary care can be recovered and should be recovered, 
but cannot be recovered when moving the wrong directions

Robert C. Bowman, M.D.        Robert.Bowman@DignityHealth.org

The blogs represent the opinion of the blogger alone.




Wednesday, July 20, 2016

Readmissions Better from ACA or Preexistingly Worse from DRG?

In 1983 after a very short period of testing on a very atypical state (New Jersey) and because there were no other existing options for cost cutting, the hospital payment method known as DRG or Diagnosis Related Groups was implemented. Bundling under a disease or condition or treatment remains a very popular method of cutting costs and is now being implemented with physician payments. What are the benefits and what are the consequences? Should we implement methods that have long term consequences when we fail to consider or study these issues?

If there is any consolation for President Obama and CMS, 

...it may well be that Readmission Penalties took away some of the "poor quality" result of the Bundling Bungling that preceded it (DRGs). This may be the only evidence for Accountable Care working. Of course Readmissions focus has consequences also.

Is the Change in Readmission Rates an Indication of Poor Quality from DRGs?

This is an interesting question. As noted previously by the President, readmissions has improved.

The following was prepared for the President by CMS.




Why Have Readmissions Improved?

Although the article implicates that ACA has contributed to a decline in readmissions, is this the whole story? There was no analysis including controls and variables. There was only a graphic with a beginning time and an end time.

There are many factors that interact to influence readmission changes. The ACA readmission penalty has been a powerful incentive. 

Perhaps the best alternative explanation for readmissions change is that "quality" as measured in readmissions, was made worse by the payment design that existed before the readmissions penalty. 


Lower quality from DRG could be huge as the DRG bundling 

of hospital payment has existed since 1983. 


Decades of health care for tens of millions of Americans may have been shaped to "poor quality" because of changes - changes such as fixed payment regardless of individual patient need, cuts in costs of supplies and personnel such as nursing, and a massive incentive to dump patients out of the hospital

But this could also be the result of  readmission rates "normalizing" after being too high before the readmission penalty was implemented. What if DRGs increased the readmission rate? This is a reasonable consideration considering the pressures to dump patients faster and without much consequence. 

What if the nation should have had 18% or even 17% all along, but the previous design resulted in a higher readmissions rate to 19% just waiting to decrease when the impact of the old design was removed? What if the DRG design inflated readmission rates from the 1980s until recently when "Accountable Care" resulted in hospitals less willing to do risky discharges?

DRG based payments (diagnosis related group bundling of payment) have focused hospitals on getting patients out faster and cheaper. Cheaper means personnel cuts and nurses are the biggest personnel cost. Nursing changes could also impact care in hospitals. Nurse ratios are considered by some to be important in care quality and patient safety.

An apparent improvement may be because of the issues that occurred in previous years.

Short List of Possible Benefits of DRGs or Bundling According to Disease

  • Cost cutting
  • Simplified payment for payers
  • Major pressure on physicians to get charts done in a timely fashion
  • Better payment to those most organized in information (faster, more)

Longer List of Drawbacks of DRGs or Bungling

  • Lesser payment and slower payment to those less organized
  • Closures of hundreds of small hospitals and decline of hospital based workforce in small health areas (general surgical specialties)
  • Facilitation of hospitalist workforce to get patients out faster, now employing 50,000 primary care trained physicians (basically polishing off internal medicine training as a source of primary care)
  • 8 to 10 billion more in hospital cost a year for hospitalists with billions more each year since 1983 to adapt to DRG and protect hospital interests
  • Additional costs of hospitalists thrust on hospitals marginal in bottom line
  • Marginalization of nursing - largest cost in personnel with personnel the largest hospital cost
  • Patients dumped faster and with less regard for home and community resources
  • Higher risk of poor outcomes for certain patients (pneumonia, anticoagulation) 
  • There are always potential problems for patients who are not always stabilized prior to departure from the hospital


Once again, health policy generally does not improve matters. Health policy results in winners and losers. Usually the bigger and more organized win and the rest are left behind - small hospitals, small practices, primary care, mental health, geriatrics, care where needed...


Can "Quality" Be Made Worse or Better?


This is the area most ignored by ACA, President Obama, and CMS. Many if not most health outcomes are shaped by patient factors - behavior, income, education, health literacy, home situations, work situations, environments, housing, and a number of daily influences. A few hours in a hospital or a few minutes of care from a physician or office is a minor influence. 

It is very difficult to prove that changes in outcomes are due to factors not associated with patient influences. The potential for a clinical intervention to influence quality is quite low. This should be obvious for a meaningless intervention involving digital health records at high cost and when impairing productivity and separating people who deliver care from the patients needing care.


To repeat, the potential for a clinical intervention to influence quality is quite low.

Is Readmission a Reasonable Indicator of Quality?

This answer is a resounding "no." The 30 day mark is a compromise - a compromise in payment that discriminates against care where needed.

Studies demonstrated that 30 days was the best choice of a time period to use. Readmission rates were not valid to use for two weeks after admission or longer than 30 days. Longer than 30 days shifts the influences substantially into patient factors and far from from hospital influence. Shorter duration is more about the level of illness of the patient or their type of condition. Different markers for "quality" would also have resulted in differences in the findings.

The science behind readmissions and all quality determinations is all quite shaky. This is because patient factors, genetics, and unknown factors are more influential.

If you want to force some measure upon hospitals, the readmissions measure is slightly better than nothing - except for rural hospitals, hospitals in counties with lowest proportions of workforce, hospitals in counties with higher proportions of elderly, poor, or disadvantaged, hospitals in counties with lesser resources and more difficult patient situations...

Perhaps the most important thing to understand about health care reform since 2010 - is how loosely the term is used. If this is all that can be obtained, how will we ever have reform that matters to most of us.

Why Not Some New Mottos?
Less Bundling Means Less Bungling
Less Peddling (EHR) Means Less Meddling in Health Care
Bigger Is Not Better When Most Depend Upon Small Health


What Do Others Say About Readmissions?
  • Readmission penalties as with other performance measure interventions, discriminate against providers that care for those who are sicker, poorer, older, or have more complex conditions.
  • Readmission improvement attempts can backfire with increases in readmissions for certain conditions.
  • Readmissions rates also have a questionable relationship with other quality measures with variation by condition.
  • Readmission rates are not always preventable. Even if a hospital does succeed in providing the highest quality of care, some readmissions simply are not preventable. Researchers estimate that 23.1 percent of 30-day unplanned readmissions are potentially unavoidable.[18] Meanwhile, the CMS goal for the Hospital Readmissions Reduction Program is to reduce 30-day readmission rates by 20 percent by the end of 2013. This would require a 91 percent reduction among those readmissions that are avoidable, which may be unrealistic.
  • Readmission rates often reflect the community and patient factors, not hospital care. Readmission rates reflect lack of local health resources, lack of local primary care access, and poorly coordinated care. Insurance design may contribute to poor coordination.
  • Incentives that distract providers can actually distract from care – by more dollars spent elsewhere, by attention of care givers directed elsewhere, by lower productivity, by financial compromise of the provider, by marginalization of patient needs. 
The above about what others say about readmissions is from What Obamacare’s Pay-For-Performance Programs Mean for Health Care Quality By Kathryn Nix

Recent Posts and References 

Rallying One Hundred for Health Access Not MACRA


The Ultimate Government Health Care Paradox - Government must facilitate better EHRs and better health access, not prevent them.

Government Compromise of Trauma Response
No Positive Spin for the Innovator Tailspin - more claims for innovation successes are apparently attempts to hide failure
Stop the Promotion To Restore Mental Health Access - claims of mental health care reforms or improvements are a stark contrast from the reality of lowest payment, highest complexity of care, unreliable payment, and poor support other than lots of rhetoric






Primary care can be recovered and should be recovered, 
but cannot be recovered when moving the wrong directions

Robert C. Bowman, M.D.        Robert.Bowman@DignityHealth.org

The blogs represent the opinion of the blogger alone.

President Obama Stretches Readmission Gains

The medical literature is apparently not immune to promotions and marketing. Graphics can be powerful at a time when few read between the lines - or read the lines at all. The following graphic was prepared for the President by CMS.



  • Note the use of only 2 points of change from 17.5 to 19.5 to enhance the apparent effect.
  • The change from 19% readmissions to 18% across this 2 percentage point difference generations a much steeper slope. 

Truncated graph - from wiki  A truncated graph (also known as a torn graph) has a y axis that does not start at 0. These graphs can create the impression of important change where there is relatively little change.

The other graphics presented by the President are more reasonable. For example the % uninsured has the full 0% to 25% represented graphically.

The big question arising from the claim of improvement with readmissions penalties is whether the previous payment system resulted in worsening of readmissions and perhaps other quality measures. Perhaps the DRG design was the problem as seen in patients sent home at times too soon, as seen in in marginalization of nurses, and as seen in overstressed home and primary care situations. 




Recent Posts and References 

Rallying One Hundred for Health Access Not MACRA


The Ultimate Government Health Care Paradox - Government must facilitate better EHRs and better health access, not prevent them.

Government Compromise of Trauma Response
No Positive Spin for the Innovator Tailspin - more claims for innovation successes are apparently attempts to hide failure
Stop the Promotion To Restore Mental Health Access - claims of mental health care reforms or improvements are a stark contrast from the reality of lowest payment, highest complexity of care, unreliable payment, and poor support other than lots of rhetoric





Primary care can be recovered and should be recovered, 
but cannot be recovered when moving the wrong directions

Robert C. Bowman, M.D.        Robert.Bowman@DignityHealth.org

The blogs represent the opinion of the blogger alone.