Reform Rodeo

Photo by David Monniaux

1. ACO Yo!: The Healthcare Economist discusses recent research into how the accountable care organization (ACO) model may be leveraged by providers to increase prices. For those looking to learn more about ACOs, the New England Journal of Medicine has recently released a video which can be found here.

2. Playing Politics?: Merril Goozner picks up on questionable appointments to the Patient-Centered Outcome Research Institute — the entity that PPACA tasked with increasing our utilization of comparative effectiveness research.

3. Mandate Mania: Tim Jost provides an update (and overview) of the constitutional mandate case in Michigan.

4. SCOTUS and Vaccine Lawsuits: The Washington Post details the Supreme Court’s effort to determine whether lawsuits by people alleging harmful effects from childhood vaccines should be allowed.

5. Certification: Jon Halamka provides the second part to his clarification of HITECH’s EHR Certification process. The first part can be found here.

6. Fragmentation Symposium: Concurring Opinions held an online book review symposium of Barak Richman, Daniel Grossman, and Frank Sloan’s chapter,  Fragmentation in Mental Health Benefits and Services, in Our Fragmented Health Care System: Causes and Solutions (Einer Elhauge, ed. 2010).

Will Physicians and Hospitals Ever Get Along? Prospects for Defragmentation in a Post Health Care Reform World by Richard Saver

Waldo’s Optimal Fragmentation by Elizabeth Weeks

Why “House” is the True American Health Care Hero, And What To Do About It by Vickie Williams

Getting Mental Health Coverage Wrong by John Jacobi

Health Reform, “Death Panels,” & Section 1182–What the Text Really Says

Photo by Cathologiccga

This post is a follow-up to my prior post on the Patient-Centered Outcomes Research Institute, a nonprofit corporation created by the Patient Protection and Affordable Care Act (the Health Reform Law), which will oversee comparative clinical effectiveness research–or, in Palin-ese, “the Death Panel.” The pertinent text of the law under which the Institute will operate appears below along with explanation in the plainest English available.

LIMITATIONS ON CERTAIN USES OF COMPARATIVE CLINICAL EFFECTIVENESS RESEARCH

Sec. 1182. (a) The Secretary may only use evidence and findings from research conducted under section 1181 to make a determination regarding coverage under title XVIII if such use is through an iterative and transparent process which includes public comment and considers the effect on subpopulations.

• TRANSLATION: Must be open and transparent and must consider effect on particular groups, but can use research to make determinations regarding coverage

‘(b) Nothing in section 1181 shall be construed as–

‘(1) superceding or modifying the coverage of items or services under title XVIII that the Secretary determines are reasonable and necessary under section 1862(l)(1); or

‘(2) authorizing the Secretary to deny coverage of items or services under such title solely on the basis of comparative clinical effectiveness research.

• TRANSLATION: Coverage cannot be based solely on CER

‘(c)(1) The Secretary shall not use evidence or findings from comparative clinical effectiveness research conducted under section 1181 in determining coverage, reimbursement, or incentive programs under title XVIII in a manner that treats extending the life of an elderly, disabled, or terminally ill individual as of lower value than extending the life of an individual who is younger, nondisabled, or not terminally ill.

• TRANSLATION: CER cannot be used to assign a  lesser value to extending the life of the elderly, disabled or terminally ill (as compared to the younger and healthier) in regard to treatment. Health care dollars cannot be allocated first (or exclusively) to young and relatively healthy individuals under the rationale that extending the lives of the younger and healthier is, by definition, more valuable. The issue is further explored in 1182(e), discussed below. 1182(e) further limits the use of such valuations with regard to the Quality Adjusted Life Year.

‘(c)(2) Paragraph (1) shall not be construed as preventing the Secretary from using evidence or findings from such comparative clinical effectiveness research in determining coverage, reimbursement, or incentive programs under title XVIII based upon a comparison of  the difference in the effectiveness of alternative treatments in extending an individual’s life due to the individual’s age, disability, or terminal illness.

• TRANSLATION: When evaluating treatments to extend an individual’s life, CER can be used to determine whether Medicare will cover one  treatment rather than an alternative. Specifically, an individual’s age, disability, or terminal illness can be a factor in deciding which treatment will be covered, reimbursed and/or incentivized.  For example an elderly person with severe coronary artery disease may have two treatment options: surgery (e.g. revascularization) or drug therapy. Both of these treatments would theoretically extend the life of the patient by reducing the odds of a heart attack or stroke. However (hypothetically) CER data may demonstrate that an individual of advanced age lives longer on average if they opt for drug therapy. In such a circumstance, this section provides that CER data may take into account the individual’s age, disability and terminal illness when comparing two alternative treatments. It may also be the case that CER data shows that individuals with certain disabilities are less likely to respond to surgery or to different treatment, possibly due to immobility, or even impending death. Again, these facts can be taken into account in the CER calculus.

‘(d)(1) The Secretary shall not use evidence or findings from comparative clinical effectiveness research conducted under section 1181 in determining coverage, reimbursement, or incentive programs under title XVIII in a manner that precludes, or with the intent to discourage, an individual from choosing a health care treatment based on how the individual values the tradeoff between extending the length of their life and the risk of disability.

• TRANSLATION: The Secretary cannot use CER to deny or try to persuade a patient from choosing a treatment that may prolong their life but leave them severely disabled. Alternatively, the Secretary cannot prevent a patient from choosing a treatment which may improve the quality of their life, as opposed to an alternative treatment which may extend the length of life.

‘(2)(A) Paragraph (1) shall not be construed to–

‘(i) limit the application of differential copayments under title XVIII based on factors such as cost or type of service; or

• TRANSLATION: The extant differential copayment guidelines are unaffected. 

‘(ii) prevent the Secretary from using evidence or findings from such comparative clinical effectiveness research in determining coverage, reimbursement, or incentive programs under such title based upon a comparison of the difference in the effectiveness of alternative health care treatments in extending an individual’s life due to that individual’s age, disability, or terminal illness.

• TRANSLATION: See 1182(c)(2) discussed above.

‘(3) Nothing in the provisions of, or amendments made by the Patient Protection and Affordable Care Act, shall be construed to limit comparative clinical effectiveness research or any other research, evaluation, or dissemination of information concerning the likelihood that a health care treatment will result in disability.

• TRANSLATION: This section is straightforward. The Institute can compare various treatments and determine which is more likely to result in a disability, and disseminate those findings.

‘(e) The Patient-Centered Outcomes Research Institute established under section 1181(b)(1) shall not develop or employ a dollars-per-quality adjusted life year (or similar measure that discounts the value of a life because of an individual’s disability) as a threshold to establish what type of health care is cost effective or recommended. The Secretary shall not utilize such an adjusted life year (or such a similar measure) as a threshold to determine coverage, reimbursement, or incentive programs under title XVIII.’

• WHAT IS A QALY?: The Quality-Adjusted Life Year (QALY) is defined by the NIH as:
  • (1) A unit of measure of utility which combine life years gained as a result of health interventions/health care programs with a judgment about the quality of these life years.
    (2) A common measure of health improvement used in cost-utility analysis, it measures life expectancy adjusted for quality of life. (See NIH’s Health Economics Information Resources, Glossary, at http://www.nlm.nih.gov/nichsr/edu/healthecon/glossary.html#QALY)
• The goal of the QALY is to ensure that healthcare resources are allocated in a manner which is most beneficial. Because healthcare resources are scarce, however, the $/QALY looks to allocate those resources economically. The QALY ipso facto discounts the value of life due to a disability. This is because the QALY works by assigning different states of health along a continuum, with perfect health being 1 and death being 0. The QALY is interested in whether different treatments provide more QALYs, In other words, QALYs are interested in whether one treatment provides more years at a better state of health (i.e., closer to 1) than another treatment. See M. Weinstein, Spending Health Care Dollars Wisely: Can Cost-Effectiveness Analysis Help? (2005)

• TRANSLATION: The Institute cannot utilize a $/QALY ( or a similar measure) as a threshold to establish what treatment is cost-effective, recommended or incentivized. (It is, however, noteworthy that in describing “similar measure,” both “age” and “terminal illness” are not expressly excluded as prohibited criteria in the development of a metric, as they are throughout the text of other portions of the provision).

• Note: 1182(c)(2) does allow for a disability to be taken into account when comparing various treatments for an individual. That section must be distinguished from the current section (1182(e)), where the upshot is that the dollar valued QALY cannot be a benchmark by which to allocate resources. If we are only determining which of two resources to a given individual shall be reimbursed, then the individual’s disability may be taken into account, i.e., treatment effectiveness under the individual’s circumstances  is a metric for which CER may be utilized; however, dollar value of life quality is not a permitted metric or criteria for treatment.