Recommended Reading

As proof that the only news in health law does not involve the Supreme Court’s consideration of the challenge to the Affordable Care Act, here are some interesting recent articles that are worth a read:

1.      Frank McClellan and others recently released the results of their study, “Do Poor People Sue Doctors More Frequently? Confronting Unconscious Bias and the Role of Cultural Competency.” Some doctors perceive that socioeconomically disadvantaged patients tend to sue their doctors more frequently, which has influenced them not to provide care or to provide care in different ways to this population. For example, 57 percent of physicians polled in California in 1995 cited this belief as important in their decision not to treat Medicaid patients.  Yet McClellan and his co-authors review studies showing that, to the contrary, poor patients tend to sue their physicians less often than other groups.   Indeed, there is evidence that patients in lower socioeconomic groups are also less likely to file nonmeritorious malpractice claims.  One possible explanation that the authors of this project offer to explain this disconnect between physician perception and fact is unconscious or implicit bias, which “describes thinking and decision making affected by stereotypes without one being aware of it” that “can explain why people may consciously believe in a truth, whereas their behavior, affected by subconscious prejudices, is contrary to that truth.”  For example, physicians unconsciously concerned that poor patients will not adequately compensate them for their care “might consciously or unconsciously presume poor patients are more likely to sue as an excuse or way of avoiding the presumed difficulty associated with collections from such patients.” The authors of this study make recommendations to confront unconscious bias and provide culturally competent care (”CCC”), including increasing diversity, educating providers about CCC, improving provider communication skills, and enhancing patient health literacy.  CCC educational efforts are especially valuable in specialties like orthopaedic surgery, where approximately 84 to 89 percent of providers are white males.   It is thought that these efforts will improve medical care to lower socioeconomic groups and reduce the risk of malpractice claims.

2.      In “Diversion of Offenders with Mental Health Disorders: Mental Health Courts,” Sarah Ryan and Dr. Darius Whelan review the use of mental health courts in the United States, Canada, England, and Wales and consider whether these courts should be established in Ireland.  The article first reviews Therapeutic Jurisprudence (”TJ”), a foundational theory underlying problem-solving courts like mental health and drug courts that “promotes the employment of a ‘problem-solving pro-active and results oriented posture that is responsive to the current emotional and social problems of legal consumers.’”  While advocating its strengths, the authors also warn of the danger that paternalistic applications of TJ can water down due process and rule of law values.  They then identify and compare features of mental health courts that have developed in the United States, Canada, England, and Wales since the pioneer court started operating in Broward County, Florida in 1987.   After evaluating the main merits (e.g., more appropriate treatment and potentially reduced recidivism and costs) and criticisms (e.g., concerns about coercion, waiver of due process rights, stigmatization and segregation of the mentally ill, diversion of resources, and lack of empirical data that they are effective) of these courts, the authors conclude that mental health courts could offer a partial solution to the challenges facing Ireland’s criminal justice system.  Not surprisingly, they urge policymakers to select the best features of the programs that have evolved to date and to apply TJ “in a careful manner, to avoid interference with defendants['] constitutional rights.”  For example, the authors recommend that a solicitor be appointed at the first indication an offender could be eligible to participate.  Further, they believe that Ireland should not require offenders to plead guilty as a pre-condition to participate in the program because such a requirement is “antithetical to the goal of decriminalising the mentally ill.”  They warn, however, that for the program to be viable, Ireland would have to allocate substantial funding to develop community mental health treatment facilities.

3.      Recent Harvard Law School graduate Maggie Francis has written, “Forty Years of ‘Testing, Testing’: The Past and Future Role of Policy Experimentation in Healthcare Reform,” which reviews the federal government’s use of pilot projects and demonstration projects over the past forty years to test innovative health reform ideas.   As Ms. Francis describes, her article is the “first . . . in the legal literature to analyze the use of systemic policy experimentation by the federal government to reform the healthcare system.”  She describes the number and types of problems facing the healthcare system and why policymakers have chosen pilots as a means of addressing these problems.   The article then evaluates whether pilot projects are a useful tool in healthcare reform.  Ms. Francis identifies numerous advantages to pilots, including that they provide some cover to controversial innovations from political pressures and permit government to try multiple theories in different pilots to assess what works better in different populations, locations, etc. and to make adjustments based on experience that should make large-scale implementation smoother.  She also warns of some possible roadblocks, including lack of adequate information and competence to select the right pilots and then to oversee their implementation and evaluation.  A common criticism of these programs is that they take too long to test new ideas and expand those that are successful.  Securing consistent funding has also been a challenge.  In addition, political interference and gamesmanship can undermine efforts to innovate.  Ms. Francis concludes that, despite their limitations, pilot projects satisfy policy makers’ need for information about reform ideas and their consequences and offer the most promise where “organizational challenges, rather than stakeholder opposition and distributional problems, are the primary obstacle to reform.”  As a result, she posits that pilots might be more successful at encouraging widespread adoption of less controversial innovations, such as medical homes, than with contributing “significantly to the goal of cost control, which necessarily raises contentious distributional issues among powerful stakeholders in the healthcare industry and is likely to trigger rent-seeking behavior by interest groups.”  Ms. Francis’s observations are not merely historically interesting but rather offer important insights given the variety of pilot projects included in the ACA to help identify a politically viable way to bend the healthcare cost curve while improving quality.  Ms. Francis reviews the diverse medley of pilots in the ACA, including, but far from limited to, the creation of the Center for Medicare and Medicaid Innovation, reminding us all how much more there is to the ACA than just the mandate and how much we will learn from its implementation.

Happy reading!

New Jersey’s Recent Efforts to Combat Prescription Drug Abuse

New Jersey is adding to its arsenal of resources to investigate and combat prescription drug abuse and diversion.

On January 18, 2012, New Jersey’s new Attorney General, Jeffrey S. Chiesa, announced the launch of the State’s long-awaited Prescription Monitoring Program (”PMP”), which permits the State to monitor prescriptions for controlled substances.  (I blogged last June about the passage of the statute authorizing the PMP, N.J.S.A. 45:1-45-1-52.)  According to AG Chiesa, the PMP is “a powerful new tool in the State’s fight against the abuse and diversion of prescription drugs, and the often-heavy reimbursement costs of fraudulently-obtained prescription medication borne by health insurance companies, the State, and ultimately taxpayers.”

Before the PMP, investigators of inappropriate prescribing or usage patterns, absent timely and reliable complaints, had to pick which pharmacies, providers, or patients to investigate and then cobble together data from these various sources, looking for the proverbial needle in a haystack.   It often took quite a bit of time and resources, not to mention a bit of luck, to find the evidence required to demonstrate diversion or abuse.

The PMP now centralizes these data in a searchable database maintained by the State’s Division of Consumer Affairs.   Since September 1, 2011, the PMP has been collecting information from 2,000 pharmacies throughout the State every 15 days regarding the prescription sale of all drugs classified as controlled dangerous substances (CDS) and human growth hormone (HGH).   As AG Chiesa explains, the PMP “database will help the Division of Consumer Affairs and other law enforcement agencies identify and investigate individuals and businesses suspected of fraudulently diverting controlled drugs for abuse. By highlighting the location, nature, and extent of abuse throughout the state, the information collected will also better inform our healthcare initiatives and addiction-treatment efforts.”

Investigators are not the only folks with access to this data.  Beginning January 4, 2012, State-licensed prescribers and pharmacists may register to be able to access the PMP database to help inform their professional decision making with regard to current patients.  Consumer affairs also will provide information garnered from the database to other law enforcement agencies and the professional licensing boards, as permitted by law.

By May 2012, the State intends to enhance and expand the PMP database to permit more sophisticated statistical analysis.  According to the State:

When fully expanded, the NJPMP will generate reports on geographical areas with unusual CDS or HGH prescription activity during a specific time frame; identify practitioners in each county who prescribed the largest quantities of a specific drug during a given time period; and provide other information that can help identify and compare troubling patterns of CDS and HGH activity.

By using the PMP, investigators may more swiftly identify patients who are filling multiple prescriptions for CDS or providers who are authorizing large quantities of CDS.  With this information, investigators may examine whether there are medically appropriate justifications for these prescriptions, or if this is evidence of diversion, abuse, or fraud.   For example, the State’s press release recounts that investigators used the PMP to identify a patient who obtained a four-month supply of methadone and oxycodone in just over one month by presenting what are now believed to be fourteen forged prescriptions to three different pharmacies, and they made this discovery within a month of the abusive behavior.

To help the State maximize the potential of the PMP, AG Chiesa announced the “next step” in the State’s “comprehensive, statewide plan to fight the diversion and abuse of prescription drugs” — a reorganization and expansion of the Enforcement Bureau (”EB”) of the Division of Consumer Affairs.  The EB is the investigative arm of the various state professional boards, including the State Board of Medical Examiners and Board of Pharmacy, which investigates potential professional misconduct by the licensees of these Boards.   The AG plans to add investigators to the three investigative sections that play “a key role in the Division’s effort to curb prescription drug diversion and abuse” to permit the EB to develop expertise in identifying “the unlawful distribution and diversion of prescription medications.”

First, the AG plans to grow from 7 to 9 the number of undercover investigators in its drug diversion section, which investigates “cases related to the distribution and diversion of prescription drugs; indiscriminate prescribing and dispensing; prescription fraud; and enforcing the bans enacted by the Division of Consumer Affairs on so-called “bath salts” and other designer drugs.”  Indeed, the State’s press release reports that one investigator has already been hired.

The AG also plans to add 4 pharmacist/investigators to the current 9 in the pharmacy inspection section, to inspect pharmacies and review security protocols to try to prevent theft of CDS.

It then will add three nurse/investigators to its quality of healthcare section, which currently has 7 registered nurses or other experienced investigators.  By monitoring the quality of care provided by licensees primarily of the medical and nursing boards, this section often oversees investigations concerning “drug impairment and self-use by practitioners, and health insurance fraud.”

The AG also said that the 20 investigators in EB’s other 2 investigative sections will be available as needed to support the State’s efforts to fight prescription drug diversion.

There is much to applaud here.  Public health demands increased efforts to curb prescription drug abuse and diversion.  If used appropriately, these initiatives offer considerable promise — individuals, including practicing health care professionals, in need of substance abuse treatment can be identified in a more timely fashion; practitioners lacking adequate training in the prescribing of controlled substances can be required to take additional courses; and dishonest or dangerous practitioners can lose the privilege of licensure.

These initiatives also raise a number of policy and legal questions that need to be fleshed out.  These include, just to identify a few:

• How do we ensure patient privacy? Prescribing doctors and pharmacists must certify that they are accessing the database for a current patient, but how do we verify the truth of their certifications?
• When will information be shared with other law enforcement entities?
• New Jersey’s statute permits the State to enter interoperability agreements with other states so that each state may access the other’s data. When will other states be able to access New Jersey’s database?
• The statute does not require prescribing doctors and pharmacists to access the database — should it, to better inform care decisions? (The Massachusetts Senate unanimously passed S. 2122recently, generally requiring doctors to check the State’s PMP database before prescribing a Schedule II or III narcotic drug to a patient for the first time. Not everyone, however, thinks it’s a wise proposal.)
• Should New Jersey amend the PMP statute to permit non-prescribing substance abuse treatment providers, such as social workers or psychologists, to access the database?
• How do we discern from the data which high volume prescribers may be too readily prescribing — or even complicit in diversion — and which are needed palliative care doctors who treat a disproportionate number of patients in chronic pain? It is critical that well-trained, ethical pain management doctors are not deterred from practicing their specialty by fear of being caught up in a protracted, potentially career-ending investigation. (Somewhat relatedly, the Florida Legislature recently killed a bill that would have prohibited doctors from writing prescriptions for controlled substances while arrested and awaiting trial on — but not yet convicted of — a charge relating to controlled substances.)
• What public policy initiatives can be adopted to ensure that all patients with legitimate prescriptions for pain medication can get those prescriptions filled at local pharmacies?

I am encouraged by New Jersey’s continued efforts to combat the real and deadly challenges of prescription drug abuse and diversion, but I encourage balance in the implementation of these new tools so that patients suffering from pain are not denied appropriate palliative care.  I am eager to work through these issues.  Let’s start a dialogue.  I welcome your ideas.

Bill Requiring Licensure of One-Room Ambulatory Surgery Centers In New Jersey Dies in Gov. Christie’s Pocket

Governor Christie has pocket vetoed a bill that would have required one-room ambulatory surgery centers (ASCs) in New Jersey to be licensed by the State Department of Health and Senior Services (DHSS), as ASCs with more than one operating room already are.

More than One Room

Under current law (e.g., N.J.S.A. 26:2H-1 et seq.; N.J.A.C. 8:43A), ASCs with more than one operating room are subject to a variety of statutes and regulations, including that they must obtain a license that specifies the health care services they are authorized to perform (N.J.S.A. 26:2H-12(a)) and report certain information to DHSS on a quarterly basis (N.J.S.A. 26:25-5.1e).  ASCs providing surgical and related services must “obtain ambulatory care accreditation from an accredited body recognized by [CMS]” as a condition of licensure (N.J.S.A. 26:2H-12(h)).  They also must establish and maintain a uniform system of cost accounting, reports and audits; prepare and annually review a long range plan; and establish and maintain a centralized, coordinated system of discharge planning (N.J.S.A. 26:2H-12(a)).  The statute also assesses various fees, which it caps at $4,000 for applications for licensure or renewal and $2,000 for biennial inspections (N.J.S.A. 26:2H-12(b)).    Since 2004, licensed ASCs with gross receipts greater than $300,000 also must pay an annual assessment based on its gross receipts and the assessment, capped at $200,000 (N.J.S.A. 26:2H-18.57(b); N.J.A.C. 8:31A)), is deposited in the Health Care Subsidy Fund (N.J.S.A. 26:2H-18.58).

DHHS’s implementing regulations cover a broad array of topics, including the qualifications of  persons working at these facilities, housekeeping protocols, emergency equipment, disaster plans, physical plant requirements, and laundry policies and procedures (NJAC 8:43a-1 et seq.).   The regulations impose a biennial inspection fee (N.J.A.C. 8:43A-2.2(m), although DHSS’s web site says that it inspects licensed ASCs every three years.

One Room

ASCs with only one operating room presently escape this licensure requirement (and its corresponding regulatory demands) because they are defined as physician’s surgical practices, which are excluded from the definition of surgical facilities that must be licensed.   (N.J.S.A. 26:2H-12(g)(5); N.J.A.C. 8:43A-1.3)  While surgical practices do not yet need to obtain a license,  they must register with DHSS, which registration, in turn, carries a variety of conditions.  For one, they must “obtain certification by the Centers for Medicare and Medicaid Services [(CMS)] as [] ambulatory surgery center provider[s] or obtain ambulatory care accreditation from an accrediting body recognized by [CMS]” - similar to larger ASCs.  They also must annually report to DHSS data regarding patients serviced by payment source and staffing levels.   The Commissioner of DHSS has the ability to revoke, suspend, or deny an application for a registration if the surgical practice is not in compliance.   The statute also prohibits ownership, management, or operation of a surgical practice “by any person convicted of a crime relating adversely to the person’s capability of owning, managing, or operating the practice.”  (N.J.S.A. 26:2H-12(j)) One-room ASCs also are regulated by the State Board of Medical Examiners as private physician practices.  The BME has enacted regulations establishing policies, procedures, staffing, and equipment requirements when practitioners perform surgery (other than minor surgery), special procedures, and anesthesia services in an office setting (N.J.A.C. 13:25-4A).  The BME has the authority to investigate and bring a licensing action against any physician who fails to comply with these regulations (N.J.S.A. 45:1-18, 45:1-21).  One-room ASCs serving Medicare or Medicaid patients also must satisfy federal standards and be certified by CMS.   If a one-room ASC is certified by CMS, DHSS conducts inspections on behalf of CMS every four years.  DHSS and the BME (N.J.S.A. 45:1-18(c)) also may conduct inspections to investigate complaints filed about a one-room ASC.  But there is no present state requirement that one-room ASCs be inspected by the BME or DHHS.

One Rooms Cited for ‘Immediate Jeopardy’

A report issued by the New Jersey Health Care Quality Institute (NJHCQI) in April 2011 shined the spotlight on the lack of oversight of one-room ASCs.  NJHCQI reviewed reports of inspections in 2009 and 2010 of 91 ASCs in New Jersey that reportedly were funded by a one-time federal grant.  40 of the 91 inspected facilities were unlicensed one-room ASCs, 17 of which (43%) were cited for “immediate jeopardy,” which is “defined as noncompliance with established rules that has caused, or is likely to cause, serious injury, harm, impairment or death to a patient.”  (In comparison, 8 of the 51 licensed facilities (15%) that were inspected were found in “immediate jeopardy.”)   The cited violations included, among others, a variety of improper sterilization and infection control procedures; inadequate tracking of medications, including controlled substances and expired medications; improper anesthesia administration; and failing to have necessary emergency medications or an agreement to transfer patients requiring emergency care to a hospital.  The report concluded that, “[b]ased on this snapshot,  . . there is evidence that consumers may be at greater risk in unlicensed Surgical Practices than in licensed ASCs” (emphasis in original).  Thus, the NJHCQI urged the State to require regular inspections of one-room ASCs and warned patients, in the mean time, not to use these unlicensed facilities.

What Could have Been

S.2780 looked to close the regulatory gap between one-room and larger ASCs - for the most part.  The version that passed New Jersey’s Assembly and Senate on January 9, 2012 would have amended N.J.S.A. 26:2H-12 to require ASCs with one operating room to be licensed by DHSS within one year of enactment as an “ambulatory care facility licensed to provide surgical and related services.”  This licensure requirement would have replaced the current registration requirements.  DHHS, then, would have had to inspect one room ASCs, just as it inspects larger ASCs.

But S.2780 also included provisions that treated one-room ASCs differently than larger ASCs.  All one-room ASCs would have been exempt from paying the ambulatory care facility assessment required by N.J.S.A. 26:2H-18.57.  Those that are certified by CMS (whether in operation on the day of enactment or not) or accredited by the American Association for Accreditation of Ambulatory Surgery Facilities or other CMS-recognized accrediting body (and in operation on the day of enactment) would not have had to meet the physical plant and structural requirements detailed in N.J.A.C. 8:43A-19.1 et seq.  The rest of the one-room ASCs that fail these exemptions would still have been able to seek a waiver (N.J.A.C. 8:43A-2.9) of the physical plant and structural requirements, which the Commissioner could have granted if it would not have “endanger[ed] the life, safety, or health of patients of the public.”  These concessions seemed to respond to reported warnings from some one-room ASC owners that “a new fee and a potential requirement to remodel their offices might drive [them] out of business.”  The bill also would not have subjected one-room ASCs to the current restrictions on DHSS’s ability to issue new licenses to ASCs with more than one operating room (N.J.S.A. 26:2H-12(i)).

Jeffrey Shanton, chair of Advocacy & Legislative Affairs Committee for the New Jersey Association of Ambulatory Surgery Centers, is quoted as describing S2780 as “one of the most important pieces of legislation concerning the ASC industry in New Jersey in years.”  Reportedly, the New Jersey Hospital Association and the Medical Society of New Jersey joined NJAASC in supporting its passage (in addition to consumer groups, like NJHCQI).

But now, S.2780 is dead.  Governor Christie did not veto it - directly.  Instead, by not taking action on this bill, which was passed on the last day of the legislative session, he has killed it via a “pocket veto.”

Going Forward

Legislators can’t override a pocket veto, but they may re-introduce the bill and try again.  If they do, it seems eminently reasonable to require inspections of one-room ASCs, whether by DHHS or BME, as long as there is adequate funding and staffing to complete these inspections without draining resources from other critical public health programs.    It would be critical to ensure that the $2,000 inspection fee is sufficient to cover DHSS’s costs and that the Department would not be prohibited from hiring necessary staff to fulfill this legislative requirement.

The Legislature also should be sure public safety requires the one-size fits all regulation model that this bill proposed.  If the costs of complying are too high, small offices may not seek licensure as an ASC and cease performing procedures that patients may have appreciated.  Perhaps that’s an acceptable outcome, but the Legislature should study the public safety benefits against the potential costs on physicians and patient access to services.  The standard of care and quality should not vary in different settings, but perhaps there is a way for the level of formality and overhead to be in proportion to the size of the facility without compromising public safety.

It also is notable that S.2780 did nothing to resolve the existing tangle of issues caused when in-network providers refer their patients to out-of-network ambulatory surgery centers that then charge an out-of-network facility fee.    (Senator Vitale’s earlier amendment to S.2780 conditioning waiver of the ambulatory care facility assessment on the one-room ASCs’ agreement “not to charge patients or third party payors a facility fee, room charge, or other similar fee or charge” did not survive legislative negotiations.)  S.2780 also would have amended N.J.S.A. 45:9-22.5 to extend the exception to the Codey Act’s self-referral prohibitions for larger ASCs to one-room ASCs.  As Kate Greenwood has discussed, there are reasons to question the wisdom of this exception (much less to extend it).

While legislators tackle these issues, one-room ASCs still do not have to be licensed in New Jersey.  But the State may investigate complaints, so be sure to speak up, if you have concerns.  There are links here to check if a facility is licensed, get copies of inspection reports, file a complaint, and search for information about providers.

Photo (Pocket) by ArnoldRheinhold
Photo (Jeopardy!) by Justin_Levy via Flickr

Defining Essential Health Benefits

As many of us just finished scurrying to fulfill our children’s increasingly unrealistic holiday wish lists (my six year-old wanted a laptop and a phone — hah!), it’s a fitting time to step back and think about what is essential.

Section 2707 of the Affordable Care Act (ACA) requires all non-grandfathered health insurance coverage offered in the individual or small group markets beginning in 2014 to include essential health benefits (EHB).  Section 1302 then largely leaves the task of defining this term to the Secretary of HHS, as long as EHB include these ten statutorily itemized general categories:

(A) Ambulatory patient services.
(B) Emergency services.
(C) Hospitalization.
(D) Maternity and newborn care.
(E) Mental health and substance use disorder services, including behavioral health treatment.
(F) Prescription drugs.
(G) Rehabilitative and habilitative services and devices.
(H) Laboratory services.
(I) Preventive and wellness services and chronic disease management.
(J) Pediatric services, including oral and vision care.

The statute also directed that the scope of EHB must be “equal to the scope of benefits provided under a typical employer plan.”  (For more background on EHB, see Timothy Jost’s recent blog post on Health Affairs.)

Given the complexity of establishing a national floor for coverage, it is not surprising that the statute was short on specifics, and stakeholders have been waiting for HHS to provide detailed guidance as 2014 gets closer and closer.

On December 16, 2011, the Center for Consumer Information and Insurance Oversight in HHS released a bulletin outlining HHS’s intended regulatory approach to defining EHB.  After balancing “comprehensiveness, affordability, and State flexibility” along with input from various camps, HHS’s “intended regulatory approach utilizes a reference plan based on employer-sponsored coverage in the marketplace today, supplemented as necessary to ensure that plans cover each of the 10 statutory categories of EHB.”  Specifically, HHS

intends to propose that EHB be defined by a benchmark plan selected by each State.  The selected benchmark plan would serve as a reference plan, reflecting both the scope of services and any limits offered by a “typical employer plan” in that State . . . .

The bulletin identifies four benchmark plan types for 2014 and 2015 (HHS will assess the benchmark process for later years based on experience and feedback): (1) “the largest plan by enrollment in any of the three largest small group insurance products in the State’s small group market; (2) any of the largest three State employee health benefit plans by enrollment; (3) any of the largest three national FEHBP plan options by enrollment; or (4) the largest insured commercial non-Medicaid Health Maintenance Organization (HMO) operating in the State.”  It also indicated HHS’ intent to propose a default benchmark plan if a State does not exercise its discretion to select its benchmark.

Under HHS’s intended regulatory framework, insurance providers could adopt the balance achieved by the State benchmark, but it must supplement the benchmark it if it does not include all ten ACA-required categories.  HHS solicited comments regarding “options for supplementing missing categories.”  HHS also intends to require plans to offer “benefits that are ’substantially equal’ to the benefits of the benchmark plan selected by the State and modified as necessary to reflect the 10 coverage categories.”  It wants to provide flexibility to adjust benefits as long as there is coverage in all ten categories, and the flexibility will be “subject to a baseline set of relevant benefits.”

This bulletin raises more questions than it answers.  HHS itself seeks comment on a variety of issues, including the definition of habilitative services, what to require when a benchmark plan does not cover one of the ten statutory categories, or whether to permit substitutions between (and not only within) categories, subject to “a higher level of scrutiny.”   What do terms like “substantially equal” or “higher level of scrutiny” mean in practice?

On a more macro level, the bulletin raises the classic tension between centralized, prescriptive programs and those that permit states flexibility.  On the one hand, permitting state flexibility may ease states’ objections to federal interference with insurance regulation, and permit experimentation to reflect  local circumstances.  As the bulletin recognizes, all states have their own benefit mandates, so the less prescriptive the federal EHB definition, the lower the risk it will conflict with state-specific mandate requirements.

Yet with devolution comes the possibility that state decisions will frustrate the achievement of the ACA’s policy goals.  It remains to be seen how HHS effectively will police the various state and local decision makers who will exercise this discretion to protect consumers from discriminatory behavior.   How powerful will HHS’s oversight be?  For example, HHS’s review of the scope of existing coverage of mental health and substance use disorder services revealed great variations in coverage.  How much variation is acceptable?  What is the substance of the “baseline set of relevant benefits” that is supposed to limit state  discretion?  What role will politics have in this state-by-state process?

These questions just scratch the surface and remind us how critical it is to engage in this debate.  Jason Millman, writing for Politico, noted that consumer groups have not yet taken “the sky-is-falling position” in protest of HHS’s intended regulatory approach even though they have advocated for specific, federal requirements.  The sky may not be falling, but there are important policy issues in play that will benefit from careful and deliberate airing.  Comments on the bulletin must be submitted by January 31, 2012 to EssentialHealthBenefits@cms.hhs.gov.

Here’s to a new year in which more of us realize the essentials we all  shouldn’t have to live without.  Happy and safe holidays!

Recent Comparative Studies of Health Systems

As America continues to wrestle with the thorny thicket of health care reform, there are a number of recent reports chronicling and comparing approaches to health care and health reform in different countries that are worth a read.  For example:

• The Organisation for Economic Co-operation and Development recently released Health at a Glance 2011: OECD Indicators, which provides “comparable data on different aspects of the performance of health systems in OECD countries.” The U.S. spends 2 ½ times more than the OECD average health expenditure per capita (which amounted to 17.4% of GDP in 2009). (OECD explores why in a separate addendum, “Why is Health Spending in the United States So High”.) Yet, with the exception of cancer care and acute care in hospitals, it is not clear Americans are getting improved quality for the greater expenditures. As reported by CQ HealthBeat and by the Commonwealth Fund, “hospital services cost much more in the United States and pharmaceutical prices are much higher compared to other countries;” “there are fewer practicing physicians per 1,000 population, fewer doctor consultations and shorter hospital stays;” “more CT scans, knee replacements, and Caesarean sections;” and “comparatively high hospital admission rates for preventable conditions like asthma, diabetes and hypertension.”

• Strengthening Primary Care: Recent Reforms and Achievements in Australia, England, and the Netherlands, a recent report by Sharon Willcox, Geraint Lewis, and Jako Burgers of the Commonwealth Fund, evaluates efforts to improve access to, and the quality of, primary care in these countries– and suggests what the U.S. can learn from these initiatives. These countries have been focusing on three primary care reform strategies: promoting coordination of care, reforming primary care payment, and improving quality and access. As the abstract summarizes, “[q]uality improvement strategies include postgraduate training programs for family physicians, accreditation of general practitioner (GP) practices, and efforts to modify professional behaviors–for example, through clinical guideline development. Strategies for improving access include national performance targets, greater use of practice nurses, assured after-hours care, and medical advice telephone lines. All three countries have established midlevel primary care organizations both to coordinate primary care health services and to serve other functions, such as purchasing and population health planning. Better coordination of primary health care services is also the objective driving the use of patient enrollment in a single general practice. Payment reform is also a key element of English and Australian reforms, with both countries having introduced payment-for-quality initiatives. Dutch payment reform has stressed financial incentives for better management of chronic disease.”

• Bradford H. Gray, Thomas Bowden, Ib Johansen, and Sabine Koch, also of the Commonwealth Fund, review the extent of adoption of “meaningful use” (as defined in federal regulations) in three countries with extensive experience with electronic health records, Denmark, New Zealand, and Sweden in Electronic Health Records: An International Perspective on “Meaningful Use.” Although these European countries have high levels of EHR adoption, they have not reached 100% meaningful use, with the greatest weakness being in information provided to patients. The authors suggest that the U.S. could learn from these experiences the value of “providing economic incentives to encourage adoption and designating an organization to take responsibility for standardization and interoperability.”

• International Profiles of Health Care Systems: Australia, Canada, Denmark, England, France, Germany, Italy, Japan, the Netherlands, New Zealand, Norway, Sweden, Switzerland, and the United States, edited by Sarah Thomson, Robin Osborn, David Squires, and Sarah Jane Reed and published by the Commonwealth Fund, provides an overview of the health systems in these countries– including “health insurance, public and private financing, health system organization, quality of care, health disparities, efficiency and integration, use of health information technology, use of evidence-based practice, cost containment, and recent reforms and innovations.”

• The Commonwealth Fund also recently released results of an international study of patients with complex care needs in eleven countries: Australia, Canada, France, Germany, the Netherlands, New Zealand, Norway, Sweden, Switzerland, the United Kingdom, and the U.S. Although it identified significant care coordination issues, it found that “patients who have a medical home reported better coordination of care, fewer medical errors, and greater satisfaction with care than those without one.” In addition, the study also found “that patients in the United States are much more likely than those in 10 other high-income countries to forgo needed care because of costs and to struggle with medical debt.” 27% “were unable to pay or encountered serious problems paying medical bills in the past year, compared with between 1 percent and 14 percent of adults in the other countries,” and 42% did not see a doctor, fill a prescription, or receive recommended care. The authors conclude that “[t]he United States in particular has opportunities to learn from abroad-including the use of purchasing power to lower prices, payment innovations, and the use of information systems and care system redesign efforts that are under way in several countries.”

Of course, there are a variety of reasons the experiences in other countries may not take root in the United States.  But we still should be aware of these efforts and critically evaluate whether we might transplant any of them as seeds of reform here.

Rising Health Insurance Premiums: Don’t Let Yourself Be Spinned

It’s not surprising that opponents of health reform are capitalizing on the rather surprising findings of the Kaiser Family Foundation’s Employer Health Benefits 2011 Annual Survey that the average annual premiums for employer-sponsored health insurance increased 8 percent for single coverage and 9 percent for family coverage from 2010.   These numbers don’t sound good.

But analysis by Jon Gabel, Senior Fellow at NORC at the University of Chicago, Roland McDevitt, Director of Health Research at Towers Watson, and Ryan Lore, Senior Associate at Towers Watson, which is summarized on the Commonwealth Fund Blog and will be detailed more fully in a forthcoming issue brief, shows that the vast majority of premium increases are not tied to health reform, and those that are relate to improved coverage.  As the authors summarize:

[Our analysis] attributes only 1.8 percentage points of the 8 percent to 9 percent rise in premiums to the insurance reforms. Moreover, this marginal increase as a result of the reforms also means that families have better coverage that protects them from catastrophic health care costs as well as lower out-of-pocket costs for preventive services like colonoscopies and mammograms. It’s logical that improvements in the quality of the product would increase the cost of premiums and lower out-of-pocket costs to some degree.

This is not to minimize the impact of these increases.  Any increase in premiums, especially in a challenging economy, warrants scrutiny.  But rather than rush to judgment on data taken out of context by spinsters with a political agenda, we must continue to carefully consider the full panoply of facts and how they interrelate.  While some premium increases in the group markets seem to be linked to health reform, are the benefits worth the costs?

For example, the study estimates that expanding coverage for adult children accounts for 0.9 percent of the premium increases and affects 91 percent of group policyholders; banning limits on lifetime maximum benefits is responsible for 0.5 percent in premium increases and impacts 53 percent of group policyholders; and requiring employers to offer certain preventive services without cost-sharing increases premiums by 0.4 percent and affects 24 percent of group policyholders.   The total additional annual cost of the increased premiums tied to health reform amounts to $167 per policyholder in the group markets.

It is critical to explore whether these enhanced coverage options warrant increased premiums.  While we do, we also should ensure the public is aware that there is more to the data than nearly 10 percent premium hikes so it does not get dizzy from the spin cycle.

Community Based Medicaid ACOs in New Jersey: A Signature Away

Almost daily, there is a new article or study emphasizing the need for innovative reform to save Medicaid amidst growing threats of deep cuts to the already struggling program.  New Jersey, as one of the states with the highest Medicaid spending per beneficiary in the country, is paying attention.  And help may be on the way in the form of a medical home/safety net.

Showing promise, the medical home model of care is an oft proposed reform.  As Mary Takach explains in the July 2011 edition of Health Affairs, “[a] patient-centered medical home is an enhanced model of primary care in which care teams, led by a primary care provider, attend to the multifaceted needs of patients and provide whole-person, comprehensive, coordinated, and patient-centered care.”  (See “Reinventing Medicaid: State Innovations to Qualify and Pay for Patient-Centered Medical Homes Show Promising results,” Health Affairs, July 2011, 30(7):1325-34.)

According to the National Academy for State Health Policy, thirty-nine states are working to implement medical homes for Medicaid and CHIP participants, and New Jersey is one of them.  In September 2010, Governor Christie signed Assembly Bill 226 into law, which established a three-year Medicaid medical home demonstration project that, at minimum, will include “primary care providers utilizing a multi-disciplinary team that provides patient-centered care coordination through the use of health information technology and chronic disease registries across the patient’s life-span and across all domains of the health care system and the patient’s community.”  The statute requires that the payment system “be structured to reward quality and improved patient outcomes” and that Medicaid “[c]onsider payment methodologies that support care-coordination through multi-disciplinary teams, including payment for care of patients with chronic diseases and the elderly, and that encourage services such as: (a) patient or family education for patients with chronic diseases; (b) home-based services; (c) telephonic communication; (d) group care; (e) oral health examinations, when applicable; and (f) culturally and linguistically appropriate care.”   You can learn about various medical home initiatives in New Jersey at the National Center for Medical Home Implementation web site.

Takach’s report focuses on seventeen states that have aligned “patient-centered medical home standards with incentive payments to support reform in the delivery of primary care” — Colorado, Iowa, Maine, Maryland, Massachusetts, Michigan, Minnesota, Nebraska, New York, North Carolina, Oklahoma, Oregon, Pennsylvania, Rhode Island, Vermont, Washington, and West Virginia.

Although these programs are in their infancy, Takach interprets limited early data from a few states as encouraging. Vermont, for example, documented that inpatient use had decreased twenty-one percent, with a corresponding twenty-two percent decrease in per person per month inpatient costs, and that emergency department use had decreased thirty-one percent, with a corresponding reduction of thirty-six percent in per person per month costs (although its second pilot community had what Takach describes as “mixed results”).  Colorado similarly has seen decreases in its median Medicaid costs per patient for children.

Both Colorado and Oklahoma also have seen increases in participating providers since the medical home model started operating.  In Oklahoma, more than 244 new physicians enrolled in Medicaid.  Ninety-six percent of pediatricians now accept Medicaid in Colorado, up from only twenty percent before the program began.  Increasing the number of Medicaid providers is critical, given national shortages of available primary care Medicaid providers.

As Takach summarizes:

Some of the early findings from Colorado and Oklahoma, which have statewide Medicaid initiatives, demonstrate that modest increases in payment aligned with quality improvement standards have not only resulted in promising trends for costs and quality, but have also greatly improved access to care.  This is an important finding for other states as they consider how to meet the tremendous increase in demand for care that will result from the expansions to Medicaid in the Affordable Care Act of 2010.

But beyond a medical home, there needs to be a safety net for the most vulnerable urban populations who are, in a sense, medically homeless– and are, by EMTALA default,  frequent utilizers of high cost emergency room services.

As this blog and other sources, including The New Yorker, have discussed, New Jersey  is home to the Camden Coalition of Healthcare Providers, which describes itself as “a citywide organization of social workers, nurses, physicians, administrators, hospitals, health services organizations, and clinics that serve the health needs of Camden, New Jersey residents.  [It] work[s] in a variety of settings — from small neighborhood based practices to hospital based offices — with the goal of improving the coordination and capacity of the healthcare system for residents of Camden.” Dr. Jeffrey Brenner has been leading this effort since 2002.  His work offers promising program models for safety-net providers throughout the country to “improve the quality, capacity, and accessibility of the healthcare system for vulnerable populations.” Indeed, even though the budget bill signed by Governor Christie slashed Medicaid funding in New Jersey by $540 million, his Commissioner of Human Services has expressed continuing support for the Coalition’s pilot because it is seen as a smart reform that could save money while improving care.  Newark and Trenton also have established citywide healthcare coalitions to improve medical care for their vulnerable, underserved residents. And we at the Center for Health and Pharmaceutical Law and Policy have worked closely with the Greater Newark Healthcare Coalition.

In a recent post on the Health Affairs blog, Dr. Brenner and Nikki Highsmith note that although the Camden Coalition “has had preliminary successes and offers potential long-term savings, such community-based endeavors are difficult to initiate and sustain without start-up financing, ground-level technical assistance, and buy-in from state and local policymakers, health plans, patients, and community members.”  They thus call on CMS to “jump start investments in safety-net ACOs” by pursuing a national demonstration project to support programs similar to Camden’s pilot.

New Jersey is poised to be ready if CMS heeds this call for a national Safety Net ACO demonstration project because the Coalition and other New Jersey stakeholders, including Seton Hall Law Professor John Jacobi, have been active in advocating for a bill (S2443) authorizing geography-based Medicaid ACOs in New Jersey. As the Coalition’s web site summarizes:

The proposed New Jersey law would authorize a three-year Medicaid ACO demonstration project whereby community-based, non-profit coalitions can apply for recognition by the State of New Jersey as a Medicaid ACO.  The applicants must propose a geographic focus and will need 100% of the [general] hospitals, 75% of the primary care providers, [four] behavioral health providers, and two community [organizations] from that geography on the board of the organization.  The providers in the community will continue to receive their usual Medicaid payments and the ACO, if its providers meet quality benchmarks, would be eligible to receive shared savings payments, that can be distributed to participants based on a proposed gain sharing plan.

The proposed legislation specifically recognizes that patient-centered medical home models are one way, among others, to achieve coordination. On June 27, 2011, the Assembly and Senate passed S2443, and it is awaiting Governor Christie’s signature.

New Jersey’s proposed Medicaid ACOs go beyond Medical Homes. They are built on a foundation of sound primary care, but they offer the promise of reaching vulnerable populations in many settings, and of assuring that the right care is provided at the right location for people who are often left out of health reform efforts. The financing mechanisms provided by the bill awaiting the governor’s signature go some way towards financing these innovating community organizations, although, as Brenner and Highsmith point out, more needs to be done –particularly in the way of providing start-up funding for community providers.

Appropriately cultivated, patient-focused collaborations such as these may  yield synergies in care and cost of a substantial scale.   But another recent Health Affairs article suggests that adoption of the medical home may well develop at a slower pace in states, like New Jersey, where physicians tend to be organized in smaller practices.  New Jersey’s Medicaid ACO pilot could  help to accelerate the development of practice reformation in New Jersey — particularly if CMS provides the support advocated by Jeff Brenner and Nikki Highsmith.

It’s an exciting time for growth and innovation in the Garden State … if we just get that signature.

Moving the Battle of the Experts to the Hot Tub?

Michael Ricciardelli’s recent post concerning a judge-directed negotiation pilot program in the Bronx to facilitate early resolution of medical malpractice cases reminded me of another idea to improve our expensive, expert-deadlocked, malpractice litigation system: hot tubbing.

I first heard this term (related to litigation, that is) earlier this Spring when a former colleague shared an article by Bryan Finlay QC, head of the litigation practice at WeirFoulds LLP in Canada, and law student, Kristi Collins, that discusses hot tubbing as an example of a new tool for judges to use in managing evidence in complex litigation.  According to this article, hot tubbing, also less colorfully referred to as concurrent evidence, refers to “a method of presenting expert evidence all at once by having the expert witnesses for both parties give testimony, answer questions, and fully discuss the expert evidence on one panel.” Finlay and Collins report that this practice originated in Australia in recent years and is gaining attention in Canada, the United Kingdom, and the United States.

Honorable Justice Peter McClellan, Chief Judge at Common Law, Supreme Court of New South Wales, Australia, describes the concurrent evidence process in a 2010 article in the Journal of Court Innovation:

Concurrent evidence is essentially a discussion chaired by the judge in which the various experts, the parties, the advocates and the judge engage in a cooperative endeavor to identify the issues and arrive where possible at a common resolution of them. Where resolution of issues is not possible, a structured discussion, with the judge as chairperson, allows the experts to give their opinions without the constraints of the adversarial process and in a forum which enables them to respond directly to each other. The judge is not confined to the opinion of one advisor but has the benefit of multiple advisors who are rigorously examined in public.

* * *

[Concurrent evidence] requires the experts retained by the parties to prepare a written report in the conventional fashion. The reports are exchanged and, as is now the case in many Australian courts, the experts are required to meet without the parties or their representatives to discuss those reports. . . .  The experts are required to prepare a bullet-point document incorporating a summary of the matters upon which they agree, but, more significantly, matters upon which they disagree. The experts are sworn together and, using the summary of matters upon which they disagree, the judge settles an agenda with counsel for a “directed” discussion, chaired by the judge, of the issues in disagreement. The process provides an opportunity for each expert to place his or her view on a particular issue or sub-issue before the court. The experts are encouraged to ask and answer questions of each other. The advocates also may ask questions during the course of the discussion to ensure that an expert’s opinion is fully articulated and tested against a contrary opinion. At the end of the discussion, the judge will ask a general question to ensure that all of the experts have had the opportunity to fully explain their positions.

(To see how hot tubbing works in trials in Australia, you can watch a video narrated by Justice McClellan here.)

Finlay and Collins report that “[e]xperts tend to like the hot-tubbing method.”  As they explain, “[t]he procedure allows them to more fully flesh-out and discuss their positions in, at least the beginning, a less adversarial way.  They like the opportunity to pose questions to each other.”  Justice McClellan agrees, reporting that “[t]he change in procedure has been met with overwhelming support from the experts and their professional organizations.”  This can lead to a more collegial and less partisan and adversarial exchange among professional colleagues.  This process may also reduce the likelihood that experts will take extreme positions, knowing that a colleague stands ready to challenge the basis for their statement.

Justice McClellan also relayed that “[a]lthough counsel may be hesitant about the process initially, [he has] heard little criticism once they have experienced it.”

Finders of fact, too, seem to like what hot tubbing offers.  Justice McClellan, who has presided over numerous hot tubs, is an unabashed proponent:

From the decision-maker’s perspective, the opportunity to observe the experts in conversation with each other about the matter, together with the ability to ask and answer each others’ questions, greatly enhances the capacity of the judge to decide which expert to accept. Rather than have a person’s expertise translated or colored by the skill of the advocate, and as we know the impact of the advocate can be significant, the experts can express their views in their own words. There also are benefits which aid in the decision-writing process. Concurrent evidence allows for a well-organized transcript because each expert answers the same question at the same point in the proceeding.

Read more

Controlling the Controllers of Controlled Substances

Despite their name and extensive government regulation, controlled dangerous substances (”CDS”) are far from controlled.  Licensed  health care providers are essential cogs in the prescription drug control machine.  Many faithfully execute their responsibility to prescribe CDS only where necessary and appropriate to relieve patient pain.  But sadly, some professionals are aggravating the situation.  Significant percentages of the professional licensing cases that I prosecuted in my previous position as a deputy attorney general in New Jersey involved abuse of prescribed CDS by patients and licensed professionals.

Some professionals are completely complicit, brazenly selling prescriptions (and their professional integrity) from their offices or cars.

Others aid and abet misuse by writing prescriptions too freely, for varying reasons and to varying degrees of culpability.  Some wear rose-colored glasses and miss tell-tale warning signs or just like to make people happy and have trouble confronting their patients.   Still others lack the training to know what types of questions to ask to identify drug-seeking behavior or how to effectively and safely combine different drugs to treat patients’ particular problems. Patients can be very skilled at keeping their providers in the dark, so some providers simply do not know that they are feeding a habit.   Others rationalize that it is better to keep their patients coming back for treatment than to send them to the streets for illegal drugs.

And, of course, others conscientiously wrestle with how to balance the need to relieve the very real pain they or their patients are experiencing with the reality that they or their patients are developing addictions.  It’s a thorny thicket, for sure.

No matter the reason, the problem of prescription drug abuse is intensifying, and we need to try something new.  This Spring, the Office of National Drug Control Policy (ONDCP) unveiled “Epidemic: Responding to America’s Prescription Drug Abuse Crisis,” which is “a multi-agency plan aimed at reducing the ‘epidemic’ of prescription drug abuse in the U.S. — including the FDA-backed education program that zeros-in on reducing the misuse and misprescribing of opioids.”  This plan has four main components: improving education of patients and health care providers; expanding state-based prescription drug monitoring programs; improving means for proper disposal of unused CDS from homes; and stepping up enforcement to reduce “pill mills” and doctor-shopping.

As part the education part of the plan, the FDA is working to implement a “Risk Evaluation and Mitigation Strategy (REMS)” for extended-release and long-acting opioid products, such as OxyContin and Duragesic (full list of drugs available here).  As FDA’s consumer update regarding this initiative summarizes, “[t]he new REMS plan focuses primarily on: educating doctors about proper pain management, patient selection, and other requirements and improving patient awareness about how to use these drugs safely.”  On May 16, 2011, FDA met with an Industry Working Group to discuss these ideas, including how to assess the effectiveness of the REMS plan.

Although generally I applaud any effort to better educate practitioners about the dangers of CDS, I worry how valuable this plan will be once implemented.  For one, it requires drug companies to prepare the educational materials.    Each has an interest in presenting its drug in the best light so that doctors are not afraid to prescribe it.  Would not government-funded, unbiased academic detailers, expert in pain and addiction medicine, be more effective?

In addition, the REMS plan does not require doctor training.  If we don’t even lead the horse to water, how can we ever quench its thirst?   How can we hope to affect the prescribing practices of health care providers who do not receive critical training?  It seems indisputably reasonable to require training in CDS prescribing before a practitioner is entrusted with the phenomenal responsibility to write prescriptions for CDS.   (According to a November 18, 2010 article by Susan Okie, M.D. in the New England Journal of Medicine, two FDA advisory committees agree with this requirement.)   This is especially crucial in states like New Jersey, where a medical license is plenary, and thus any licensed physician, regardless how little training in pain management s/he has had, may prescribe pain medicine.

Reportedly, other federal agencies are lobbying Congress to require mandatory physician training as a condition to receiving the Drug Enforcement Administration registration number that doctors must have to prescribe controlled substances.  But generally, the federal DEA registration process looks to state law.  If state law permits a physician to prescribe CDS, there normally is not a separate federal requirement.  This policy respects that licensing is among the states’ traditional police powers.  I expect that Congress is well aware that individual state licensing boards would bristle at Washington dictating the rules governing the practice of professions within their borders.

Not surprisingly, then, some states are not waiting for Congress to act.  According to Dr. Okie, the licensing boards in California, Rhode Island, and West Virginia require some degree of pain-management training.  We need to know what their experiences have been.  Is the training making a difference?  Is there any evidence that requiring training is discouraging doctors from prescribing CDS to patients in pain?

Dr. Okie’s article also details a law that is scheduled to go into effect in Washington state in mid-2011 that will require doctors who prescribe opioids to enter their patients’ clinical responses to treatment in a statewide database and to consult with a pain specialist if the prescribed dose exceeds a threshold.  The hope is that physicians who have thus far not changed their prescribing in response to voluntary educational programs and treatment guidelines may respond if their treatment success is being measured.  But some fear there are too few pain specialists to satisfy the demands imposed by this law.  Some practitioners and patients fear this will just drive patients to street drugs like heroin.

Florida, too, which reportedly is the source of eighty-five percent of the nation’s oxycodone and is known as the nation’s “Pill Mill Capital,” is taking bold steps to address prescription drug abuse.  In addition to increasing oversight of clinics, pharmacies, and wholesale distributors of CDS, its new statute signed into law on June 3, 2011 subjects physicians to administrative and criminal penalties for violating prescriptive regulations governing CDS prescribing.  For example, doctors will face a minimum of a six month suspension and $10,000 fine if they overprescribe CDS.  The law also requires certain doctors to register with the State and restricts their ability to prescribe certain controlled substances.  Doctors also must meet more exacting requirements for record keeping, prescription writing, and treatment plans for those receiving CDS.

The Florida law also authorizes the state to create a prescription-drug monitoring database that will help law enforcement track which providers may be indiscriminately prescribing CDS.  Upon request, treating physicians will have access to this data to inform their treatment decisions.  Approximately 34 other states are operating similar databases, although each has its own rules regarding what entities may access the data, what drugs must be reported, etc.

It is beyond the scope of this post to address the policy pros and cons of all of the provisions in Florida’s new law.  With respect to the prescription drug monitoring database, however, I long have thought it would be valuable to provide prescribing providers access to integrated pharmacy records.  I investigated many physicians who had their patients sign agreements promising only to receive CDS from that doctor.   Investigative pharmacy sweeps helped me learn that this doctor was one of many the patients were using to feed their habit.  But doctors in New Jersey have not had any access to this information unless their patients granted it to them.

But that is about to change.  Although it took years to enact, N.J.S.A. 45:1-45 - 1-52 authorizes New Jersey’s prescription monitoring program.  Section 1-46 specifically permits New Jersey physicians to access the program’s data concerning their patients (although physicians are not required to do so).  The same section also permits New Jersey to enter interoperability agreements with other states so that each state may access the other’s data.  The database is not up and running yet, but on April 7, 2011, New Jersey awarded a four-year contract to a company in Ohio to develop the database.

Once this database is operating, it will offer NJ doctors an opportunity to identify which patients are doctor-shopping and tailor their treatment accordingly.  Undoubtedly, there are risks with this system.  Patients may resent that their doctor did not trust them, for example.  In addition, doctors who primarily treat patients in chronic pain could trigger greater scrutiny from regulators because their prescribing of CDS will outpace other providers.  Regulators will need to carefully exercise their investigative powers so as not to discourage physicians from prescribing appropriate CDS.  These risks, however, seem worth the benefit of identifying patients in need of addiction counseling and treatment and reducing diversion.

But we should not rest on assumptions and hopes.  Rather, we should keenly watch what happens in places like California, Rhode Island, West Virginia, Washington, and Florida to evaluate what works and doesn’t.  Professors Diane Hoffmann (see, e.g., here and here [subscription required]) and Anita J. Tarjian (see, e.g., here) at the University of Maryland and Interim Dean Sandra Johnson at Saint Louis University School of Law (see, e.g., here), among others, raise significant concerns that aggressive enforcement of CDS restrictions can discourage physicians from prescribing CDS, which leaves un- and under-treated patients in pain.  This is unacceptable.  We should regulate with an appreciation for the strides achieved by efforts like the Mayday Pain Project to provide better care to patients suffering in pain.  By taking measured steps and being willing to tinker with our enforcement regimes as we learn, we may ensure we do not deprive patients of needed medications or scare ethical, competent pain physicians from serving their patients’ needs.

Perhaps the Federation of State Medical Boards will help lead this effort to learn from these varied efforts at the state and federal level.   According to its 2011 Annual Report, over 40 state boards have adopted the Federation’s Model Policy for the Use of Controlled Substances for the Treatment of Pain.  Clearly, state boards, without ceding their independence, look to the Federation for guidance, akin to how states view the ABA’s Model Rules of Professional Conduct.  Its policy paints in relatively broad strokes and has not been updated in more than seven years.  It would be helpful if the Federation would update its policy to reflect the current state of law and research in this area, including the impact of various reform efforts, to help state boards find balance between reining in indiscriminate CDS prescribing and the need to provide medically appropriate palliative care to patients in need.

ACOs and Racial and Ethnic Disparities: A Role for Community Stakeholders? Part Two

Part I of this post reviewed concerns raised by Craig Evan Pollack, MD, MHS, and Katrina Armstrong, MD, MSCA in their recent commentary in JAMA that implementing accountable care organizations (ACOs) will exacerbate racial and ethnic disparities in health care.  After considering the authors’ suggestions for steps CMS can take before finalizing its proposed rule to avoid this unintended consequence, I wondered whether community stakeholders might also be able to help stave off this negative policy outcome.  Now we pick up where I left off … what are community stakeholders and what role might they play in ACO formation and implementation?

CMS’s proposed rule has vague language requiring that the ACO  “establish partnerships with community stakeholders in order to advance the three-part aim of better care for individuals, better health for populations, and lower growth in expenditures” (proposed Section 425.5(d)(3)(v)).  The ACO also must describe in its application how it will partner with community stakeholders (proposed Section 425.5(d)(3)(iv)(B)(9)(ix)(H)). The lengthy preamble to the proposed rule further states that an ACO will be deemed to have satisfied this application requirement by including a community stakeholder organization on its governing body.  See 76 Fed. Reg. 19,527, 19,541 (Apr. 7, 2011).

The proposed rule, despite its length, does not shed much light on what the community stakeholder is.  Who or what is the community stakeholder?  Who does the community stakeholder represent?  Does it have an obligation to represent only the beneficiaries in the ACO or all in the relevant community?  Regardless of the answer, how can it know who its member beneficiaries are or what the relevant community is, since assignment is done retrospectively?  How is the community stakeholder selected — by the ACO?  Its beneficiaries?  What does CMS mean by partnership? If a community stakeholder is on the ACO’s governing body, is it a voting member?  There are myriad questions left unanswered by the proposed rule.

The preamble to the proposed rule, however, reveals a glimpse of CMS’ thinking when it discusses integrating community resources within the context of developing individualized care plans for targeted high-risk and multiple chronic condition patient populations as part of adherence to a “patient-centeredness criterion”:

The individualized care plans should include identification of community and other resources to support the beneficiary in following the plan. To this end, we believe that a process for integrating community resources into the ACO is an important part of patient centeredness. A wide variety of organizations, although not necessarily ACO participants may be considered a community resource, including: Employers, commercial health plans, local businesses, state/local government agencies, local quality improvement organizations or collaboratives (such as health information exchanges).  Collaboration with these types of community resources can be an important part of enabling ACOs to take account of the entirety of Medicare beneficiary population’s needs relative to their environment. Community stakeholder engagement in an ACO could be explicitly incorporated via community representation on the governing body, by having a community representative on an advisory board, or by other innovative mechanisms.

[76 Fed. Reg. 19,527, 19,550 (Apr. 7, 2011).]

CMS specifically invited ACOs in their applications to “describe additional target populations that would benefit from individualized care plans.”  76 Fed. Reg. 19,527, 19,551 (Apr. 7, 2011).]

Community stakeholders should be responsible for coordinating this collaboration with community resources and partners and helping beneficiaries most at-risk by directing ACO resources to the toughest cases.  Given the racial and ethnic segregation concerns discussed in Part One of this post, CMS should make clear that racial and ethnic minorities are among the targeted high-risk patient populations to which community stakeholders — and the ACO — must attend to satisfy the “patient-centeredness criterion.”  Part of helping ACOs “take account of the entirety of Medicare beneficiary population’s needs relative to their environment,” 76 Fed. Reg. 19,527, 19,550 (Apr. 7, 2011), must involve community stakeholders who are keenly aware of underserved or segregated groups in the ACO’s geographical area and help the ACO use community resources to outreach to these groups.

This outreach can start with education.  Patients of any race or ethnicity may gain access to higher quality care by choosing to see a doctor in an ACO that is reporting stronger quality measures — if they are aware of their rights and supported in making a change.  Community stakeholders can educate these groups about the quality data available to help them evaluate the care available to them and their right to seek care from any Medicare provider.  Helping patients, regardless of their race or ethnicity, embrace their power to cherry pick providers based on quality could mitigate the risks of further segregation that concerned the authors of the JAMA article (at least in regions where beneficiaries have a choice of providers).  Community stakeholders can help find the Rosa Parks of health care segregation to stand up and say, “I will not ride in the lower quality back of the health care bus anymore!”

But we could miss this bus if the final rule remains as skeletal as the proposed rule.  I am confident that CMS has a clear vision of productive partnerships with community stakeholders that advance its goals for better care for individuals and better health for populations.  I hope it paints a fuller picture in its final rule.

ACOs and Racial and Ethnic Disparities: A Role for Community Stakeholders? Part One

A recent commentary in the Journal of the American Medical Association warns that accountable care organization (ACO) formation may unintentionally exacerbate racial and ethnic disparities in health care.  As has been discussed in several posts on this blog (such as here, here, here, and here), CMS’s proposed rule to implement section 3022 of the Affordable Care Act details the requirements for forming ACOs to participate in the Medicare Shared Savings Program.  With the period to comment on this proposed rule closing June 6, 2011, the time is ripe to bring these concerns to CMS’ attention, along with proposals for revisions to CMS’s proposed rule, so that the final rule takes every step possible to minimize these risks.

In “Accountable Care Organizations and Health Care Disparities,” published in JAMA on April 27, 2011, Craig Evan Pollack, MD, MHS, and Katrina Armstrong, MD, MSCA, reference the well-documented racial and ethnic disparities in health care in this country, which they describe as de facto segregation.  For example, they cite various studies showing that “[b]lack and white patients tend to receive care from different clinicians who work at different hospitals and different health care systems,” and, moreover, that many (though of course not all) “hospitals that treat a large proportion of black patients appear to provide lower-quality care than hospitals that treat a larger portion of white patients.”

The authors worry that the process of forming ACOs may further concentrate patients by race and ethnicity in particular health care organizations.  As they explain:

Although not explicitly selecting patients by race, ethnicity, or socioeconomic status, the current reality is that profitability in health care is strongly correlated with caring for fewer low-income patients and low-income patients are disproportionately not white.  To the degree that the creation of an ACO enables wealthy practices to preferentially align with one another, this process has the potential to further concentrate wealth and racial/ethnic groups within certain ACOs.

In addition, they note that, once established, the ACO-model creates a strong incentive for an ACO to do all it can to keep its assigned beneficiaries coming back for care and from seeking care outside of the ACO, where the ACO cannot control the costs.  If the ACO successfully retains its patients, and prevents movement between and among ACOs, the authors fear this incentive is “likely to accentuate racial/ethnic differences in where patients receive care.”

The authors also highlight the risk that health systems that disproportionately treat lower-income patients often will be not only separate but also unequal because they often have fewer resources to invest in improvements to value.  Absent these investments, it will be harder for these ACOs to qualify for shared savings.  And around the gerbil wheel we go, as racial and ethnic disparities widen.

In addition, the authors are concerned that hospitals that disproportionately care for patients from certain racial and ethnic groups may elect not to bother going through the effort to form an ACO, given the high start-up costs and because these patients’ care is too fragmented and difficult to coordinate.  (But see the Medicaid ACO-model that Dr. Jeffrey Brenner is developing in Camden, New Jersey to focus resources on the 1 percent of the city’s population that accounted for 30 percent of its health costs, as discussed, here, here, and here.)

As Drs. Pollack and Armstrong summarize:

In a worst-case scenario, the cherry picking of practices in ACO formation and the process of owning patient panels will concentrate white patients within certain hospital systems that will be able to make the greatest investment in improving value and will receive the greatest benefit from the ACO arrangement.  Although not intentional, this scenario leaves lower-income patients who are less likely to be white more concentrated in hospital systems that have relatively fewer financial resources and less ability to compete in a new world of accountable care.

So what can we do to reduce the risk of these unintended consequences of ACO formation?

In fairness, CMS’s proposed rule already includes some provisions that may mitigate these risks. For example, the proposed rule makes it harder for ACOs to cherry pick patients because assignment is done retrospectively (proposed Section 425.6(b)).  Thus, in theory, because patient choice of provider drives assignment of beneficiaries to ACOs, patients of all races and ethnicities can choose the provider who offers the highest quality care.

Reality, of course, limits the power of patient choice, where, for example, there are few provider options in a given geographical region.  The proposed rule does not address the lack of provider choice in underserved regions, although it does include certain provisions that give a preference to providers who tend to serve underserved populations.  For example, the proposed rule provides a greater percentage of shared savings to, and demands a smaller percentage of shared losses from, ACOs that include a rural health clinic (RHC) or federally qualified health center (FQHC) (proposed Sections 425.7(c)(7) and 425.7(d)(6)).  It also exempts ACOs from the 2 percent net savings threshold adjustment under the one-sided risk model where: all participants are physicians or physician groups; 75 percent or more of its assigned beneficiaries reside in counties outside of a metropolitan statistical area; 50 percent or more of its assigned beneficiaries were assigned based on services received from Method II critical access hospitals; or at least 50 percent of its assigned beneficiaries had at least one encounter with a participating FQHC or RHC (proposed Section 425.7(c)(4)). The proposed rule also recognizes a rural exception (proposed Section 425.5(d)(2)) to the Proposed Statement of Antitrust Enforcement Policy regarding ACOs Participating in the Medicare Shared Savings Program.  These provisions may make it easier for ACOs to form and work for quality improvements in underserved areas.

The authors of the JAMA article recommend a number of additional steps CMS should take to minimize the risk of unintentionally further entrenching racial and ethnic disparities through ACO implementation.  For example, they suggest that CMS consider patients from medically underserved racial and ethnic groups and individuals with low-socioeconomic status as at-risk when making the required adjustments for patient characteristics (proposed section 425.7(b)) and monitoring to be sure providers are not avoiding at-risk patients (proposed Section 425.12(b).   They also suggest that it may be necessary to use incentives to make sure all populations have an opportunity to be in ACOs.   To assist in evaluating the effect of ACO formation on racial and ethnic groups, they also recommend requiring ACOs to report quality indicators by race and ethnicity; studying whether there is a relationship between the distribution of patients by race and ethnicity among ACOs and quality of care received; monitoring what patient populations are excluded from this reform because their providers elect not to seek to form ACOs; and monitoring hospital and practice consolidations to “avoid patient and practice cherry picking in ACO creation . . . from a disparities [and not just an antitrust] perspective.”

Each of these suggestions warrants serious evaluation.  While some, such as race-based incentives or classifications, may face steep political and legal opposition, it is difficult to conceive of a viable challenge to the measured recommendations seeking data to inform evaluation of ACO implementation.  Indeed, these would serve CMS’s oft-repeated goal to make changes and improvements to the Shared Savings Program as it learns what works and what doesn’t.  See 76 Fed. Reg. 19,527, 19,560 (Apr. 7, 2011).

In addition to these suggestions, I wonder if community stakeholders might also play a role in mitigating the risk of further segregation of care.  Who are community stakeholders, you might ask?  You’re not alone.  Little appears to have been written about them.  But stay tuned for Part Two of this post, which will explore this elusive player in ACO formation.

[Ed. Note: Part Two may be found here.]

The Normative Meets the Practical: Who Should Can Lead ACOs

One of the many $64,000 questions in the accountable care organization (ACO) debate has been who should lead these organizations.  In a policy adopted in November 2010, the American Medical Association (AMA) made clear its view that ACOs must be physician-led.  The American Hospital Association (AHA) refrained (at least in its public letter to CMS) from asserting its entitlement to the ACO helm, based, for example, on its management experience and pools of capital.  Instead, it simply urged CMS to “defer details of the organization, such as leadership and management structure, to each ACO.”

CMS seems to have heeded the AHA’s advice because its recently released proposed rule does not directly take on this normative debate.  (See Summary of CMS Proposed Rule on Accountable Care Organizations recently posted by Jordan T. Cohen for an overview of the proposed rule.)  While “ACO participants must have at least 75 percent control of the ACO’s governing body” to be eligible for participation in the Shared Savings Program (proposed Section 425.5(d)(8)), the definition of “ACO participant” in the proposed rule includes physicians and hospitals, among others (proposed Section 425.4).

Similarly, the proposed rule simply requires that the “ACO’s operations must be managed by an executive, officer, manager, or general partner whose appointment and removal are under the control of the organization’s governing body and whose leadership team has demonstrated the ability to influence or direct clinical practice to improve efficiency processes and outcomes” (proposed Section 425.5(9)(ii)). The proposed rule does not address who or what would make the best such leader.

The proposed rule, however, clearly preserves a role for physicians to form and lead ACOs. For example, it recognizes that ACOs may be comprised of professionals in group practice arrangements and networks of individual practices, independent of hospitals (proposed Section 425.5(b)).

In addition, “[c]linical management and oversight [of the ACO] must be managed by a full-time senior-level medical director . . . who is a board-certified physician . . .,” and “[a] physician-directed quality assurance and process improvement committee must oversee an ongoing action-oriented quality assurance and improvement program” (proposed Sections 425.5(9)(iii) and (iv)).

The proposed rule also builds in a preference for ACOs comprised of all physicians or physician groups with fewer than 10,000 assigned beneficiaries by proposing to exempt them from the 2 percent net savings threshold adjustment under the one-sided model (proposed Section 425.9(c)(4)(i)).  It also proposes to vary confidence intervals, which affect the minimum savings rate, by the size of the ACO in the one-sided model “to improve the opportunity for groups of solo and small practices to participate in the Shared Savings Program” (Preamble to proposed rule at Section II.F.10).

But on a practical level, the specifics of CMS’ proposal may — unintentionally, perhaps — give hospitals the greater chance to take the reins, at least initially.  An apparently leaked CMS internal discussion document reflects some level of concern that physicians may have a hard time taking the lead with ACOs.

The proposed rule’s regulatory impact analysis estimates that the average start-up investment and first year operating expenditures for an ACO in the Shared Savings Program will be $1,755,251.  In addition, the proposed rule uses a 6-months claims run-out (proposed Section 425.7(a)).  Presumably, that means ACOs — assuming they satisfy all program requirements — will not see a dime of shared savings for more than eighteen months.  CMS also proposes to withhold 25 percent of any earned shared savings accrued in a given year to ensure repayment of any losses to the Medicare program in subsequent years of the three-year ACO agreement (proposed Section 425.5(d)(6)(iii)).

Even if private physicians can amass the capital to make these upfront investments, there of course is no guarantee they will regain their outlays. A recent study published online by the New England Journal of Medicine, as reported by the American Medical Association, found that participants in CMS’ Physician Group Practice Demonstration did not recoup, at least in the initial years of the demonstration, all of the money they invested to establish ACOs.  As the AMA summarized:

Early adopters, for the most part, did not recoup their set-up costs in the first three years of operation.  The 10 integrated health systems that were studied spent an average of $1.7 million to take part in the demonstration project.  Eight received no shared savings payments in the first year of the project.  Six got a payment in the second year, and five received a bonus in the third year.

The Everett Clinic in Washington, for example, reportedly spent approximately $1 million on infrastructure for its ACO but recouped only $129,268 in shared savings during the first four years of the demonstration project.

According to a 2007 report from the National Center for Health Statistics (NCHS), in 2003-04, 80.6 percent of office-based medical practices in the United States consisted of one or two practitioners and 94.8 percent had five or fewer practitioners.  The risks associated with forming an ACO are considerable for these smaller practices to absorb, especially when, at best, the ACO will see 75 percent of its portion of any shared savings upwards of eighteen months down the road and could instead be responsible for its share of losses.  It is not clear how many small practices are willing and able to assume these risks without some substantial financial or management support.  Not surprisingly, the AMA’s statement on the proposed ACO rule specifically identifies “the large capital requirements to fund an ACO” as a significant barrier that must be addressed if physicians in all practice sizes and settings will be able to successfully lead and participate in ACOs.

Another aspect of the proposed rule that may present a particular challenge to independent physicians is proposed Section 425.11(b)’s requirement that “[a]t least 50 percent of an ACO’s primary care physicians must be meaningful [Electronic Health Records (EHR)] users, using certified EHR technology as defined in §495.4, in the [Health Information Technology for Economic and Clinical Health (HITECH)] Act and subsequent Medicare regulations by the start of the second performance year in order to continue participating in the Shared Savings Program.”

Physician practices indisputably have increased their use of EHR systems in recent years.  According to the National Ambulatory Medical Care Survey conducted by NCHS (reported here), only 17 percent of physicians in 2008 reported that they had a “basic” EHR system (which is defined as having electronic patient demographic information, patient problem lists, patient medication lists, clinical notes, orders for prescriptions, and laboratory and imaging results).  Recent NCHS data (reported here) show that that number has climbed nearly 50 percent to 24.9 percent of office-based physicians.

But basic use of EHRs is not sufficient under the proposed rule, which requires “meaningful use.”  Survey data from the Office of the National Coordinator for Health Information Technology, as reported here, show that only 41.1 percent of office-based physicians plan to apply for billions of federal dollars in EHR incentive payments that are available to Medicare and Medicaid providers under the HITECH Act, compared with 80.8 percent of acute care non-federal hospitals.  Additionally, as reported here, a recent survey from the Medical Group Management Association (MGMA) found that only 13.6 percent of medical practices that have adopted EHRs and plan to apply for the EHR Meaningful Use incentives currently are able to satisfy the fifteen core criteria necessary to establish that they are meaningful users.   Medical practices have a long row to hoe.

But the news is not all bad for physicians.  The MGMA survey also found something that suggests this issue is far from resolved on a theoretical or practical level.  As reported here, “almost 20 percent of responding independent medical practices that owned EHRs said that they had optimized their uses of EHRs” whereas “[o]nly 8.8 percent of responding hospitals — or [integrated delivery system (IDS)] — owned practices with EHRs said they had optimized their EHR use.”

Almost certainly, it is not just a coincidence that physicians are devoting their energy to becoming meaningful EHR users just as the first EHR Meaningful Use incentive payments are available. If CMS or private foundations develop additional incentive programs to help smaller practices cover the start-up costs associated with forming an ACO, the individual physician could still be in this game.  Notably, the AMA’s brief statement on the proposed ACO rule reiterates its recommendation to CMS to increase access to loans and grants for small practices as part of this puzzle.  It remains to be seen if any such programs are viable in this fiscal climate.

As promised, future posts will address the normative question of who should lead ACOs.