Congratulations Jordan Cohen ‘11 and Katherine Freed Matos ‘11

Tonight just a fond farewell and congratulations to two of our finest student bloggers: Jordan Cohen and Katherine Freed Matos, both of whom have graduated from Seton Hall Law, with each receiving  the much vaunted  Health Law Award. They are both now hard at work studying for that fiendish quiz they offer each year at the end of July to see if would be lawyers were paying attention (it is a horrible exercise, I assure you, and if someone you know is studying for the Bar– bring them some food, and leave them alone– they’ll reemerge into the land of the living soon enough). As such, it will be awhile until we hear from them (at least on this blog) again.

After the Bar Exam, Jordan Cohen will be off to employ in the law offices of Brach Eichler, LLC., a preeminent law firm in the New Jersey metro area and a recognized leader in the field of healthcare law.

Katherine Matos has been named to the Office of the Inspector General at the U.S. Department of Health and Human Services, where she will work in the Office of Counsel to the Inspector General, Administrative and Civil Remedies Branch.

You will both be missed. It was a pleasure to work with you, and this blog is better for your having been here. Can’t thank you enough, or wish you enough luck– I expect great things– as it is simply the usual for you both.

The Demographics of Illness and Cost: or, An Old Story About Chronic Conditions

We’ve reported on the distribution of health care costs among populations on numerous occasions here at Health Reform Watch. Over the last decades, our own Professor John V. Jacobi has been espousing reform, at times as almost a voice in the wilderness, as a matter of dealing in caring and cost conscious ways with chronic conditions.

In January of 2009 I noted, quoting HHS reports:

Twenty-five percent of the U.S. community population were reported to have one or more of five major chronic conditions:

• Mood disorders
• Diabetes
• Heart disease
• Asthma
• Hypertension

Spending to treat these five conditions alone amounted to $62.3 billion in 1996. Moreover, people with chronic conditions tend to have other conditions and illnesses. , according to 1996 MEPS data. On an individual level, treatment for the average patient with asthma was $663 per year in 1996, but when the full cost of care for asthma and other coexistent illnesses is taken into account, the average cost was $2,779.

When the other illnesses are added in, total expenses for people with these five major chronic conditions rise to $270 billion, or 49 percent of total health care costs.

Expenses for people with one chronic condition were twice as great as for those without any chronic conditions. Spending for those with five or more chronic conditions was about 14 times greater than spending for those without any chronic conditions. Persons with five or more conditions also have high hospital expenditures. In New York State during 2002, of the 1.3 million different persons admitted to the hospital, the 27 percent with five or more chronic conditions accounted for 47 percent of all inpatient costs.

I have also noted in July of 2009 that

…32% of Medicare costs are attributable to diabetes. It is no stretch to say that if we have a Medicare cost problem in this country (we do), what we really have is a diabetes problem (and, considering Halvorsen’s “we only get it right 8% of the time” figure, a diabetes treatment problem as well).

But first things first. 32% is a mere scooch (yes, that’s the technical term) away from ONE THIRD. That’s an enormous number. If one were to relate this portion of Medicare expense to houesehold expenditures, it occupies a place similar to a mortgage– but an expensive mortgage in a house that no one wants to live in.

And now a further health cost demographic from NPR’s Marketplace in conjunction with WHYY’s Health Desk, Gregory Warner. And yes, it’s about chronic conditions:

Tess Vigeland: Take everything this country spends on health care — the government, employers, patients — and it rounds out to a little over $8,000 per person on average.

But averages don’t really tell the whole story. A study by the National Institute for Healthcare Management found that in 2009, 15 percent of us had no health care costs at all. While at the other end, 5 percent accounted for almost half of all health care costs: $1.2 trillion.

….

Gregory Warner: Maybe you picture this high-cost patient as someone at the end of life, confined to a hospital bed and hooked up to expensive medical devices. But more likely, you’ll find this person at home or in a nursing home, living with five or more chronic conditions.

Recommended Reading: Recent Legal Scholarship on “Risk Classification by Design”

Tom Baker’s Health Insurance, Risk, and Responsibility after the Patient Protection and Affordable Care Act (forthcoming in the University of Pennsylvania Law Review) is short (it would seem a theme is beginning to emerge in my Recommended Reading posts), tightly-reasoned, and instructive.  I highly recommend it.

Professor Baker’s essay “explores the contours of the solidarity and individual responsibility” embodied in [the Patient Protection and Affordable Care Act].”  He identifies a number of challenges to the Act’s vision of “achieving … solidarity through individual responsibility[,]” including what he terms “risk classification by design.”   With the passage of the Act, health insurance companies will no longer be able to evaluate each prospective policyholder to determine the risk that he or she will need medical care and then charge him or her a premium that accounts for his or her individual level of risk.  Risk classification by design could still occur, however, “as individuals’ self select into different health care products according to their self-assessed health risk status.”  For example, ["h]igh health risk people tend to prefer more complete health insurance coverage, fewer restrictions on their choice of doctors, and other plan features that make it easier to consume more health care.”  If a plan offering with those features attracts a disproportionate number of high risk individuals, the health care costs associated with that plan would rise and premiums would increase accordingly.  The end result would be high risk individuals paying more than low risk individuals for their health insurance, “challenging the core non-discrimination value embodied in the Act.”

Professor Baker points to a number of regulatory tools that the Act gives the states, the health insurance exchanges that states have begun to create, and the Department of Health and Human Services, to address the challenges posed by risk classification by design.  These include (1) the minimum coverage requirements, which allow “less room for variation in plans that can be used to segment people into separate risk groups,” (2) the exchange certification requirement, pursuant to which an exchange can decline to certify a plan that uses “marketing practices or benefit designs that have the effect of discouraging” enrollment by high risk individuals, (3) the medical loss ratio requirements, which work by “requiring a successful cream skimming insurer to return to its policyholders all or most of the benefits of the cream skimming,” and (4) the risk adjustment procedure, the goal of which is premiums that reflect the entire exchange pool as opposed to the  pool that has self-selected into a particular plan.  These tools, Professor Baker argues, will only be partially successful, but that “will simply mean that more actuarial fairness survives than the Act’s drafters may have intended.”  And actuarial fairness, he notes, has “many supporters, not all of whom are insurance industry apparatchiks.”

I also highly recommend two other recent articles addressing the post-reform potential for risk classification by design, Will Employers Undermine Health Care Reform by Dumping Sick Employees? (published in the March 2011 issue of the Virginia Law Review) by Amy Monahan and Daniel Schwarcz, and PPACA in Theory and Practice: The Perils of Parallelism (forthcoming in the Virginia Law Review), in which David Hyman responds to the arguments made by Professors Monahan and Schwarcz.  Professors Monahan and Schwarcz warn of a “substantial prospect that [the Act] will lead some, and perhaps many, employers to implement a targeted dumping strategy designed to induce low-risk employees to retain [their employer-sponsored health insurance (ESI)] but incentivize high-risk employees to voluntarily opt out of ESI and instead purchase insurance through the exchanges[.]“  This dynamic, they fear, “could render insurance exchanges unsustainable and thereby jeopardize health insurance reform writ large.”  Professor Hyman counters that what Monahan and Schwarcz consider a “bug” might in fact be a “feature” of health reform, particularly since for “dumping/[risk classification by design] to ‘work,’ Monahan & Schwarcz are clear that it has to make employers and employees better off-both individually and collectively.”

Health Reform Watch Welcomes Tara Adams Ragone

Health Reform Watch is pleased to welcome Tara Adams Ragone, Research Fellow and Lecturer in Law here at The Center for Health & Pharmaceutical Law & Policy at Seton Hall Law. Ms. Ragone’s research and writing for the Center will focus on implementation of health care reform, accountable care organizations, health care access, and issues related to the representation of health care professionals. Ms. Ragone comes to us from the State of New Jersey, Office of the Attorney General, Division of Law, where she served as Deputy Attorney General. She handled the prosecution of licensing actions before the State’s professional boards and the Office of Administrative Law. Prior to her work with the Attorney General of New Jersey, Ms. Ragone served as clerk to The Honorable Robert A. Katzmann, United States Court of Appeals for the Second Circuit.

Her first post for HRW can be found immediately below.

A Biography of Cancer and Other Interesting Interviews

As I’m sure the great majority of our readers don’t get the regular joy of hearing Leonard Lopate at NPR’s WNYC, I thought I’d offer up these recent archive interviews for your pleasure and/or edification. Lopate’s interviews are generally extraordinary– and these are no different, except perhaps even better than the norm.

This is how they describe the show– recent favorite interviews– on the WNYC website:

Oncologist Siddhartha Mukherjee discusses his deeply personal biography of what he calls “the emperor of all maladies:” cancer. Yvonne Thornton talks about her long road to become the first African American woman board certified in the obstetrical sub-specialty of maternal-fetal medicine. Douglas Starr tells the true crime story that led to the birth of forensic medicine. And Anand Giridharadas gives us an intimate portrait of India’s remaking.

Enjoy.

Hastings Center Releases Special Report on Psychiatric Illness in Children

Earlier this month, The Hastings Center released a special report “Troubled Children: Diagnosing, Treating, and Attending to Context” that is well-worth reading.  Co-authored by Erik Parens and Josephine Johnston, the report carefully and thoroughly addresses the “intense debates” about the increasing number of children in the United States who receive psychiatric diagnoses and psychotropic medications.

The first section of “Troubled Children” discusses the complexities involved in both defining psychiatric disorders and matching individual children to diagnostic categories; the second section discusses available treatments and the evidence base that supports their use.  The third and final section of the report, in which the authors suggest reasons “why many children do not receive careful diagnoses, why evidence-based treatments are often not available, and why promising changes to children’s environments are not made,” is the most directly relevant to students and teachers of health law.

Among the reasons discussed are the “imbalance between investments in the development of new pharmacological compared with psychosocial treatments,” that physician visits are brief and often “less frequent than is necessary for optimal treatment management,” that insurance “coverage for psychosocial treatments is often more limited than for medication treatments,” and that “the system is fragmented among primary care physicians, hospitals, and various other mental health providers, with little cross-communication or coordination following referrals and limited interaction with other systems that care for children, including child protective services, juvenile justice, and schools.” Expanding on the fragmentation concern, the authors tell an all-too-familiar story, explaining that “payers are not willing to reimburse professionals for consulting with one another or developing systems that streamline communication and coordinate care. … This leaves families who are committed to psychosocial treatments to identify, access, and navigate them alone.”

In addition to its central text, which is neutral and scholarly in tone, “Troubled Children” includes ten “sidebars,” each written by a different author with an overt advocacy position.  One sidebar raises the possibility of “overmedicalization,” a negative consequence of which is that “everything becomes pathologized, turning all human difference into medical problems.”  The author of another sidebar objects that “[t]he theory of ‘medicalization’ … makes parents into scapegoats instead of grasping the real problem.”  This author notes that she “can’t imagine anyone seriously discussing the role that ‘values’ play in diagnosing cancer or suggesting that medications that shrink cancers are just tools to force people who are different to be like everyone else.”

A third sidebar discusses the correlation between adverse childhood experiences–such as parental mental illness, substance abuse, or criminality, family violence, physical abuse, sexual abuse, and neglect–and adult mental health and function and suggests that “the question whether medications are overused can actually distract us from the other important question: how do we alleviate stress in families?”  (Also recommended, this fascinating article from this week’s issue of The New Yorker profiling a pediatrician in San Francisco who hopes to use insights about the relationship between poverty, child development, and health to transform the treatment of survivors of childhood trauma.)  The authors of “Troubled Children” make reference to the “other important question” in the conclusion to their report.  They write that “[o]ur ethical obligations to children require that we–including policy-makers, educators, medical professionals, and parents–remember that in addition to changing children (by pharmacological or psychosocial means), we have the power to change the contexts in which children are embedded, which can be key to lasting improvements in their mental health.”

Health Care and You.org, Simply Well Done

There’s a new resource in town– and it’s both informative and refreshingly easy to use. It’s called healthcareandyou.org and it allows a user to click on their state, and find out what the health reform law means to them– personally. By clicking on New Jersey, I got this:

What You Need to Know About Health Care in New Jersey

• In 2011, those in the Medicare Part D “doughnut hole” will automatically receive a 50 percent discount on certain name-brand drugs and a 7 percent discount on generic drugs.
• Young adults up to age 26 can now stay on their parent’s health plan.
• NJ Protect is available for adults who have been uninsured for at least 6 months and have been denied coverage because of a pre-existing condition. Also, children up to age 19 can’t be denied coverage because of pre-existing conditions. (By 2014, insurance companies will not be able to deny coverage to anyone with pre-existing conditions.)
• Some small businesses can get tax credits to help pay for the cost of covering their employees.
• Insurance companies can’t put dollar limits on the care that is covered in your lifetime.

It will also allow further refinement by under/over 65 years old and small business owner– tailoring the pertinent information accordingly. Beyond that, the glossary is a major league help.There’s also an implementation timeline.

In case you were wondering, the site is the result of a partnership among AARP, American Academy of Family Physicians, American Cancer Society, American College of Physicians, The American Medical Association (AMA), American Nurses Association, Catholic Health Association of the United States, and the National Community Pharmacists Association.

In addition to the link in this post, the site will be listed on this blog going forward in Resources. It simply is.

Health Affairs: Innovations Across the Nation in Health Care Delivery

Health Affairs recently convened a day-long conference entitled “Innovations Across the Nation in Health Care Delivery.” Dr. Richard Gilfillan, the acting director of the Center for Medicare and Medicaid Innovation, keynoted the event as one of a number of stops on his recent “listening tour” across the states in an effort to garner input for the Center’s quest to eliminate waste and to create “a sustainable system” in health care.

The Center’s mandate under the law is “to test innovative payment and service delivery models to reduce program expenditures while preserving or enhancing the quality of care furnished.” But as Dr. Gilfillan mentioned, perhaps the most interesting aspect of the law is that if the Center can show that it has found a way to fulfill its mandate– demonstrating such and proving it to the CMS actuaries, then the Secretary can sign into effect new regulations to effectuate  new payment models for CMS.

An underlying guidance, if not a mantra, for Dr. Gilfillan is the notion that, as contained in an Institute of Medicine study, there is 30%  waste in medical services. Much of this, he believes, is attributable to our fragmented health care system; thus, the emphasis going forward should be on implementing “seamless coordinated care.” An interesting example of something that works, is a chronic care “hotline.” Dr. Gilfillan described the innovation–where a chronic disease patient, suffering from both COPD and diabetes, cold call a particular nurse, Mary, to express concerns she might have about some aspect of her health– be it weight gain, increased shortness of breath, or anything else. The patient’s daughter could Mary as well. They did. The patient’s hospitalizations are down– and the patient attributes to the program the fact that she’s still alive.

According to Health Affairs, “The program also featured several panels of CEOs and program leaders from institutions that have innovated at the patient care level; in the creation of more highly coordinated patient care systems; and at the population level, in terms of improving population health.”

It’s an interesting conference. You can find the panel videos, including Dr. Richard Gilfillan’s address  here.

Hans Rosling, Stats Guru: Income/Health in 200 Countries Over 200 Years in 4 Amazing Minutes

Just too good to pass up: via TPM and the BBC, Hans Rosling, Professor of International Health at Karolinska Institute and Director of the Gapminder Foundation, looks at the relationship between income and health in 200 countries over a span of 200 years– in a few clear and amazingly animated minutes.

Reform Rodeo: PPACA Provisions Go Live; Victor Fuchs; Physicals; Google Health

1. PPACA News: Kaiser Health News reports on the health care overhaul changes that are occurring this week, including eliminating copays for preventive services and allowing children to stay on their parents’ health plans until 26 years of age.

2. Quality not Quantity: Famed health care economist Victor Fuchs discusses the importance that health care must place on increasing the quality of life as opposed to increasing longevity.

2b. On the Health Care Blog, Matthew Holt interviews Fuchs. Maggie Mahar provides extended commentary.

3. Examining the Exam: NPR has a piece on technology’s role in the fading art of the physical examination.

4. Google Health’s Health: On the Health Care Blog, John Moore of Chilimark Research discusses a recent meeting he had with Google about the future of their once promising but recently stagnant cloud-based EHR system.

5. Mark Your Calendars: Health Affairs announces an October 5th event they will be hosting in Washington D.C. which look at comparative effectiveness research.

Nurses, Prescriptions and Pharma Influence– Under the Radar?

Very interesting point made over at Gary Schwitzer’s Health News Review Blog regarding Industry funding of Continuing Medical Education (CME) for Nurse Practitioners (if you’ve never visited Mr. Schwitzer’s blog you should, he is informative, well written and generally brief).

Seton Hall Law’s Center for Health & Pharmaceutical Law & Policy issued a White Paper last year, “Drug and Device Promotion: Charting a Course for Policy Reform,” which called for a cessation of industry funding of CME. The Center noted:

Reforming Funding for Continuing Medical Education (CME). Most states require physicians to undertake continuing medical education to maintain their medical license. The drug and device industry currently funds over half of the accredited CME courses available to physicians. The Center recommends that industry funding for continuing medical education should be phased out, and replaced by an educational process driven by physicians.

And that

• Ninety-four percent of physicians have some kind of financial relationship with industry, as reported in a major recent national study.

• Commercial support for accredited CME, nearly all of it from drug and device manufacturers, grew from $302 million in 1998 to $1.2 billion in 2006.

But what about nurse practitioners? Schwitzer, who attended the recent Georgetown Conference, “Prescription for Conflict: Should Industry Fund Continuing Medical Education?” noted that:

There are more nurse practitioners (147,000) than there are family physicians (100,000) in the US.

These advance practice nurse professionals can write prescriptions, and it’s estimated that the average nurse practitioner writes more than 6,000 a year.

And about 70-80% of those nurses who regularly attended lunch or dinner “continuing education” events sponsored by drug companies said they were more likely to prescribe the drugs that were highlighted in the lunch.

The presenter was nurse-researcher Elissa Ladd, PhD, RN, Asst. Clinical Professor, Massachusetts General Hospital Institute of Health Professions, who says the possible pharma influence on nurse-prescribers has largely flown “under the radar.”

A little quick and basic math will give us some inkling of just how much flies under that radar. We’ll use the minimum figure in all estimates. So…

147,000 Nurse Practioners each writing 6,000 prescriptions per year = 882,000,000 prescriptions. Yes, that’s 882 million prescriptions per year– conservatively estimated.

“More likely to prescribe the drugs that were highlighted in the lunch” we can estimate at 51%. We wind up with a potentially influenced 449,820,000 prescriptions. Again, conservatively estimated.

So now the only question is just what percentage or how many Nurse Practitioners “regularly attended lunch or dinner ‘continuing education’ events sponsored by drug companies?”

With a total pool of over 882 million prescriptions per year available– at least 450 million of them potentially swayed over lunch–my guess is that Pharma’s answer would be “As many as possible.”

Community Health Law Project to Assist New Jersey’s Elderly and Disabled Save Money on Their Healthcare Costs

The Community Health Law Project (CHLP) has been awarded a grant to help seniors and individuals with disabilities save money on their healthcare costs. Founded in 1976, the Community Health Law Project (CHLP) is a non-profit advocacy and legal services organization with 10 offices located throughout New Jersey. CHLP President/ Executive Director, Harold Garwin said, “We are pleased to spearhead this initiative. It augments the Law Project’s mission to provide services to the elderly and disabled throughout the State of NJ, where so many people are eligible for benefits, but so few apply.”

The grant, made possible by the Medicare Improvements for Patients and Providers Act of 2008 (MIPPA), will be used to conduct community outreach activities and help eligible individuals apply for programs that can help them save money on their Medicare premiums, deductibles, coinsurance and/or co-pay costs.

Seton Hall Law Professor and CHLP Chairperson of the Board, Paula Franzese said “Like so many government programs, the eligibility and paperwork can be a little confusing. Fortunately this grant will allow us to get seniors and the disabled the help they need and are entitled to. The benefits can literally add up to hundreds of dollars per month.”

The programs promoted by the grant include the Medicare Savings Programs known as QMB, SLMB and QI-1; the Medicare prescription drug program’s Low Income Subsidy(LIS) (also known as Extra Help), and the state’s Pharmaceutical Assistance to the Aged and Disabled Program (PAAD).

It is estimated that only 33% of individuals eligible for QMB and 13% of those eligible for SLMB or QI-1 have actually signed up for benefits. Likewise only 53% of those eligible for LIS who are not automatically enrolled through their participation in Medicaid or SSI are believed to receive the subsidy.

Seniors and people with disabilities, especially those who now receive Medicare are encouraged to call the CHLP Hotline at 1-888-838-3180 to see if they might be eligible. Advocates are available 5 days each week from 9-5 to answer questions and provide assistance in applying. Staff is also available to make presentations to community groups and organizations who are interested in learning more about these cost saving benefit programs.

The Ultimate Ends of Health Care

“I don’t want to achieve immortality through my work,’ Woody Allen said, “I want to achieve it through not dying.” The “Singularity University” is attracting Silicon Valley glitterati who think along the same lines:

[T]he Singularity — a time, possibly just a couple decades from now, when a superior intelligence will dominate and life will take on an altered form that we can’t predict or comprehend in our current, limited state . . . [will lead to a world where] human beings and machines . . . so effortlessly and elegantly merge that poor health, the ravages of old age and even death itself will all be things of the past.

Some of Silicon Valley’s smartest and wealthiest people have embraced the Singularity. They believe that technology may be the only way to solve the world’s ills, while also allowing people to seize control of the evolutionary process. For those who haven’t noticed, the Valley’s most-celebrated company — Google — works daily on building a giant brain that harnesses the thinking power of humans in order to surpass the thinking power of humans.

Ezra Klein skewers the techno-utopianism, toying with the idea that we may well be robotized before we get electronic medical records:

Right now, one of the top stories on the New York Times site is about how human beings are going to become people-computer hybrids and live forever and that vision actually seems semi-plausible until you realize that all the information about the operation to download your memories into a Macintosh will probably be kept in a manila folder in a large filing cabinet, and then it doesn’t seem so likely.

But Klein neglects the trends toward tiering in the medical system, which may well continue forking into “upper decks” where anything is possible and nether realms of penury. As Andrew Orlowski comments, “The Singularity is . . . . rich people building a lifeboat and getting off the ship.” I think that progress in bioethics depends on a rejection of that kind of thinking in favor of a more solidaristic orientation toward the needs of the worst off. As I stated in 2002,

We are all disturbed by hypothetical dystopias like Huxley’s Brave New World. But their most important flaws - the inequality, degradation, and moral irresponsibility of their inhabitants - are already apparent in [some aspects of life in the] world’s wealthiest nations[, which] spend hundreds of millions of dollars on elaborate technologies of life-extension, while contributing much less to efforts to assure basic medical care to the poorest. Public debate on regenerative medicine must acknowledge this inequality. Societies and individuals can invest in it in good conscience only if they are seriously committed to extending extant medicine to all.

If “Singularity University” turns out to be a prime philanthropic initiative of the Google guys, while the Bill and Melinda Gates Foundation sticks to “progress in fighting hunger and poverty,” I know which tech company I’ll be rooting for.

Alliance for Health Issues Major Resource, “Covering Health Issues”

Amazing resource for health care and health care reform info over at Alliance for Health, “Covering Health Issues, 5th Edition, 2010 Update.” Made possible by the Robert Wood Johnson Foundation, it has 12 chapters and covers such issues as Health Reform, Cost of Health Care, Quality of Care, Mental Health & Substance Abuse, Long-Term Care, and Disparities. The collection is a veritable treasure trove of information presented in a readily accessible manner. Though the phrase is lacking because access is free, the Fast Facts alone are worth the price of admission. A few to think about (footnotes omitted):

• Two-thirds of people age 65 today will need some long-term care in their lifetimes.

• An estimated 22.3 million people were classified as substance dependent or substance abusers in 2007. Substances abused range from alcohol, pain relievers and tranquilizers to hallucinogens, cocaine and heroin.

• Each year, about one in four adults (26.2 percent) suffers from a diagnosable mental illness, according to National Institute of Mental Health.

• In a ranking of 19 industrialized countries, the U.S. had the highest number of unnecessary deaths.

• Among 37 nations, the U.S ranks 29th in terms of infant mortality with nearly twice as many infant deaths per capita than France.

• The United States spent $2.3 trillion on health care in 2008, or $7,681 per person. This amounted to 16.2 percent of the nation’s gross domestic product (GDP).

• Health care costs more than tripled from 1990 to 2008,² and are projected to rise to 19.3 percent of GDP in 2019.

• Nearly 82 percent of the uninsured in 2009 lived in families headed by workers.

• In 2008, 17.2 percent of full-time employees and 25.5 percent of part-time employees age 19-64 were uninsured all year.

Industry Responds to Study Said to Demonstrate Link Between Physician Surgicenter Ownership and Volume of Surgeries

[Ed. note: We received the following response via email from the Ambulatory Surgery Center Advocacy Committee to Kate Greenwood's post, "Study Demonstrates Link Between Physician Surgicenter Ownership and Volume of Surgeries."  In the interest of fairness, it appears below without  comment.]

The Ambulatory Surgery Center Advocacy Committee Responds to Study Published

in Health Affairs

Industry Raises Concerns with Conclusions Drawn in New Study

Washington, D.C., April 7, 2010 - The Ambulatory Surgery Center Advocacy Committee (ASCAC), a group of leading ASC operators, state associations and the ASC Association, is compelled to respond to the incorrect assumptions made about the ASC industry put forth in a new study published in the April issue of Health Affairs. The ASCAC reinforces the important role that ASCs play in providing patients with access to convenient, high-quality care at a low cost to the health care system.

The study authors make inaccurate statements about the relationship between physician ownership of ASCs and higher surgical volume, inferring that physician owners are driven to refer patients to their facility by financial incentives. While the study authors recognize limitations with their methodology, the ASCAC is particularly concerned with their sole reliance on surgical volume as a proxy for ASC ownership. Volume is not a valid method for identifying which physicians have ownership interests in ASCs. In fact, many non-owners practice at ASCs.

Research identifies a number of positive factors that have increased the volume of surgical procedures in an ASC, including the migration of procedures and services from outpatient facilities to the less-costly ASC setting as well as patient preference and cost savings.

In 2009, KNG Health Consulting produced a report, which found that 70 percent of ASC volume growth between 2000 and 2007 was due to migration from hospitals to ASCs. It noted that for established specialties of ophthalmology and gastrointestinal (focused on in the study), the volume growth due to migration was 94 percent and 78 percent, respectively. Additionally, a larger and aging population as well as increased patient demand and medical innovation that allows for less-invasive procedures are also contributing factors for higher surgical volume in ASCs.

Patients often prefer the ASC setting for their convenient locations, ease of scheduling, shorter waiting times and faster recovery times. Patients report a 92 percent satisfaction rate after having a procedure in an ASC. Additionally, ASCs have fulfilled an important role in providing patients with access to vital preventive services, such as cancer screenings. For example, ASCs perform 40 percent of Medicare colonoscopies and the U.S. Healthy People 2010 objective to increase cancer screenings would not have been met without this expanded capacity for colon cancer screenings.

The study authors failed to recognize the significantly lower cost to patients and payors when identical procedures are performed in an ASC as opposed to the hospital outpatient department (HOPD). Research shows that Medicare patients save more than a 50 percent on out-of-pocket costs, and overall, ASCs save Medicare approximately 40 percent annually. By shifting just half of all eligible outpatient surgeries to the ASC setting, Medicare could save an additional $2.3 billion annually.

ASCs are staffed by a team of experienced medical professionals, including physicians, nurses, physician assistants and other health care experts. Data indicate that their focused expertise leads to efficient care and better patient outcomes when procedures are performed in an ASC, including low rates of medical error, infections and/or complications leading to readmission.

“With a staff of highly trained and certified medical professionals, physicians in ASCs can perform more surgeries with superior patient outcomes and low rates of medical error in our facilities,” said Brent W. Lambert, MD, FACS, Board Member of the Ambulatory Surgery Center Advocacy Committee and Founding Partner of the Ambulatory Surgical Centers of America, a physician-owned ASC development and management company. “ASCs are important providers of quality, patient-centered care and play an integral role in our country’s health care system.”

Many ASCs are privately owned by physicians, often in partnership with community hospitals or management companies. This structure enables proficient use of the facility, better control of scheduling and an environment conducive to the patient’s needs, as well as adaptable and innovative strategies for governance, leadership, efficiency and improved clinical care.

Data from the Centers for Disease Control and Prevention’s National Survey of Ambulatory Surgery show that ASCs are much more efficient than hospitals. Hospitals have also recognized that ASCs are effective partners in providing high-quality, patient-centered care, with approximately 20 percent of ASCs owned in part or exclusively by hospitals.

Higher volume in the ASC setting can also result from patient-referrals, another scenario the study did not consider.

“A significant number of new patients who ultimately need a surgical intervention are referred to our facilities from current or former patients satisfied with the care they received,” added Dr. Lambert.

The ASCAC and its partners are dedicated to working with physicians, hospitals, policymakers and other health care stakeholders to ensure that ASCs continue their commitment to excellence in quality and outcomes so that patients have the access they need to vital medical services procedures.

About the Ambulatory Surgery Center Advocacy Committee

Ambulatory Surgery Centers are health care facilitates that specialize in providing important surgical and preventive services in an outpatient setting. With approximately 5,200 Medicare-certified facilities throughout the country, ASCs perform more than 22 million surgeries per year. The Ambulatory Surgery Center Advocacy Committee is working on behalf of the industry to raise awareness of the important role that ASCs play in the health care system and the high-quality, cost-effective care that ASCs provide. The ASCAC includes the national and state ASC associations as well as representatives of all types of ASC operators and physicians. For more information about ASCs, visit www.advancingsurgicalcare.com.

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