Friday, April 25, 2008

"The Billing System We Use Is Insane"

These are not my words. According to Government Health IT's coverage of the World Healthcare Congress, these are the words of Secretary Michael Leavitt, a man who understands that the bureaucracy for which he is responsible is to a significant degree responsible for this sad state. (The transcript of the Secretary's talk as of April 25 "has been removed to update and will be posted again later this week.") But this remark seems to be less an indictment on those who try to navigate the complex health care financing landscape and more a global indictment that we - as citizens - have allowed for the evolution of such a complex and absolutely inscrutable array of details that increasingly takes valuable health care dollars away from the quality of care and into the myriad organizations who are scrambling to administer and maintain compliance with the regs. It is almost as if one says "spend more money on complexity and compliance at the expense of better health care, or go to prison for fraud."

The real thrust of the Secretary's remarks seems to be focused on the importance of his "Four Cornerstones" and his urgent plea for the health care industry and the public to understand that change is critical, it takes time and it requires both vigilance and persistence. According to's coverage, the Secretary said "Better information about quality and cost will not appear all at once, nor will the benefits of its use," adding, "It will happen gradually over the next decade, but we will get benefits at every step in our progress. ... So it is with every social and economic transformation." He added, "My hope is we will see a foundation that others can build on."

The Secretary was speaking to the World Healthcare Congress - an audience that is both part of the solution and part of the problem. If one looks at the speakers, it arguably is, as the banner add quoting the CEO of Wal-Mart says: "This is the largest gathering of health care providers, thinkers and experts anywhere in this world…." (Of course, a convocation of these professionals in a hotel may not lead to any more action than if they happened to find themselves in Reagan Airport at the same time.)

This writer views the World Healthcare Congress with a slightly jaded eye. To some extent it is a positive "group think" on the pulse of the health care industry that provides participants wiht a broad overview of current opinion, in another sense it is the quintessential "defensive meeting" where everyone goes to see what their competitors are up to. It would be interesting to view the average gross income of the speakers; by and large, these are powerful people who profit a great deal from the status quo. It is very much these people who must be convinced - through argument or legislative coercion - to accelerate their efforts to improve the collective health of the public even if at slight expense to their own short-term financial gain. Without such improvements, a far more adverse public response is a matter of months or years, may be inevitable.

Let's revisit Secretary Leavitt's Four Cornestones and understand why they are important and why their intent - if not the means of implementation - should transcend any changes in the Executive or Congress. The Four Cornerstones are:
Her is my brief take on where we are and where we should be on a few of these cornerstones:

Interoperable Health Information Technology (Health IT Standards)
  • Adoption of standards by a committee is not the rate-limiting step, it is adoption of standardized products in the marketplace. Indeed, one can be "certified" as a vendor but offer older versions of software products that do not meet certification criteria. Furthermore, there is an issue of granularity. Some standards (e.g., NCPDP SCRIPT) are fairly non-controversial. Others (ICD-10) actually reinforce the very complexity that this writer believes to be at times a threat to innovation and consumer value.
  • The Secretary is promoting e-Prescribing (disclosure: this writer is a member of the SureScripts Board - an organization that shares this enthusiasm). E-prescribing, or more broadly, medication management, is a critical requirement, but the degree of social change required is underestimated by many enthusiasts. There are issues of authentication, authorization, pharmacy workflow, prescriber back-office work changes, and incentives (e.g., pay the prescribers and pharmacists - not third party disease management companies - t0 foster compliance among the people they care for). Additionally, some of the e-prescribing standards were not sufficiently evaluated in the rushed CMS pilot and need more work - notably RxFill, RxNorm, and prior authorization. Here the issue again is not the standards but the very complexity of process. What is needed is not more high-level technology standards groups but a systematic, grass-roots, community-based program to work through the technical and cultural issues pharmacy-by-pharmacy, clinic-by-clinic and consumer-by-consumer. Much is being done here by consumer advocates, pharmacy groups, and clinicians; all see the benefit of a safe and effective medication management infrastructure. The Federal government should telegraph its commitment to push society into a digital world, but it should be respectful of the complexities often ignored when enthusiasts, full of excitement, promulgate before federal groups in Washington.
  • ACTION: Keep it simple. Work on a safe and effective, national program for medication management - a win-win for all - and get that right. This activity will bring up most of the other issues that are critical to Health IT adoption. Add to the mix clinical laboratories, and clinicians will have great incentives to adopt.
Measured and Published Quality Information (Quality Standards)
  • How can one argue with this? But as has been stated, quality is an elusive thing and is to some a "multi-agent, multi-attribute utility model problem." That means that different people have different view of what quality is and that different attributes contribute to our overall perception.
  • Our problem? The lingua franca of quality metrics are claims data. These data are designed for accommodating the ever-evolving complex reimbursement schemes. Why should one assume that an increasingly complex claims infrastructure will necessarily be optimal for quality measurement? And if we are increasingly and justifiably moving to a transparent, price-oriented, consumer-driven health savings account structure, shouldn't quality be defined in terms we understand and not in terms of complex claims? Fortunately, many federal agencies and organizations focusing on quality are doing just that.
  • ACTION: Promote quality metrics that mean something to the individual and that foster long-term well-being. These metrics should complement internal, delivery-focused quality metrics that should arise naturally if providers - particularly hospitals and other large delivery organizations - are paid for doing the right thing and not necessarily just "doing more."

Measured and Published Price Information (Price Standards)
  • This is ideal, but problematic. Again one would benefit from trying the simplest thing first. But aside from immunizations and commercial, over-the-counter offerings, what should be the first issue? I'd argue for clear and understandable prescription drug prices. The problem? No one I know is quite sure what a prescription drug really costs various suppliers, pharmacists, and consumers. I tried to summarize what little I knew of this in a blog entry about a year ago - pricing of prescription drugs. I will update this soon.
  • ACTION: We should continue to look to the large pharmacies to push prices for common drugs. We should assume that price pressure for specialty drugs and other offerings will continue but that the true costs and rebates will remain controversial. Two things must be distinguished when looking at specialty drugs: the high cost of these miraculous drugs and the hidden profits. Unfortunately, even great journalism from organizations like the New York Times sometimes confuse the two issues. (See Milt Freudenheim's insightful but somewhat flawed piece in the April 19, 2008 issue.) Ironic that in an era where drugs literally save lives (including those of people I love), the cost of these are not compared more rationally to the costs of other interventions or, something more acute - simple things like gasoline and other failed policies.
Incentives: Promotion of Quality and Efficiency of Care (Incentives)
  • The vision is a good one. If one has price information, quality information, and rational decision-makers, one will get good results. The challenges are several. First, most long-term wins in health come at the expense of short-term sacrifice (remember this principle the next time you grab for a cookie!). Second, our very human sense of denial comes into play. I'm not going to get sick, it's going to be the other guy. How else can one explain well-educated professionals in their 20s going without health care coverage? Third, we have competing priorities. When one is paying off one's credit cards and yearning for a plasma TV, emphasis on deferred gratification and long-term tax benefits just don't have much influence.
  • This writer agrees that, by and large, health professionals, like other small business people, should pay for their own information technology, but where health care providers are concerned, the infrastructure and connectivity simply are not there. So imposing electronic health records before they can communicate and individual's information to wherever it is needed is a bit like mandating telephone purchases before the telephone switches and other communication allow one to use the telephone to talk with others. One example: providing e-prescribing incentives to providers in rural communities when rural pharmacies do not have the capabilities to received e-prescriptions! In some instances, a Hill-Burton type capital infrastructure approach seems relevant. But the approach could be revenue bonds or some other debt instrument and not outright grants. If we achieve the equitable system many envision, cash flow should offset expenditures across all sectors required to make an investment. But until we get the pump primed, we won't see this laudable effect take place in a systematic way.
  • ACTION: Once again, pick a few things and achieve evolutionary progress. The overall emphasis on smoking cessation and exercise are two examples of success in some enlightened employer-sponsored programs. But these efforts do little for the unemployed and isolated. As someone observed in a recent conference in Puerto Rico, virtually everything in our environment - from sidewalks to staircases - can be designed and promoted as ways of improving health. But often they are not.
  • ACTION: In addition to creating a social climate for better health, one can continue a trend that is growing in popularity: focusing on prescription drug adherence, find a suitably priced effective drug (often a generic) and create incentives that actually cost a consumer less if they take medications regularly rather than intermittently. Or, a more controversial pick, provide all pregnant women with a financial reward for behaviors that reduce low birthweight infants (e.g., nutrition, vitamins, smoking cessation). Don't think of it as welfare; think of it as cost-avoidance resulting from fewer premature infants. Think of it as an investment in the next generation to ensure they start off in healthier shape.
This writer doesn't know very much, but it's hard to argue with the passion and principles espoused by Secretary Leavitt. Although partisanship always dominates the Washington debate, there is nothing partisan in the principles espoused; they are a great start and an essential prerequisite for effective decision-making. There are clear philosophical differences about priorities and execution among various groups both within and among various political parties, but every candidate and white paper has some points worth pondering.

The real question? What will the organizations represented by the speakers and audience at the World Healthcare Congress do to advance these aims? They represent enlightened and knowledgeable groups with focus, finances, and the wisdom to change on their own behalf before change is imposed from without. But what will these organizations do? And what will it mean to those of us (all of us), whose lives and well-being are at risk?


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