JustCare

Tag: Value-based payment

  • No data, no value in fixed upfront payments for care

    No data, no value in fixed upfront payments for care

    Kay Tillow writes for Counterpunch about the array of health industry leaders who support paying insurers and providers upfront for care, without regard to the cost of services delivered. Using a term that would make George Orwell proud, they promote “value-based care,” even though they have no evidence of value.  With higher costs and without quality data, you cannot assume there’s any value in fixed upfront payments, “capitated” payments, for care.

    Tillow hits the nail on the head. Upfront fixed payments for care appears to be fostering worse health outcomes, higher costs, and greater health inequities. Putting the bad actors aside, in an upfront payment system with no good way to measure value–there’s little meaningful data–even the best actors need to avoid treating a disproportionately high number of patients with costly needs because they will lose money. Providers can avoid that predicament by designing their practices in a way that avoids patients with complex conditions or delays their care, which is easy enough to do.

    Put differently, a payment system that requires physicians to share the risk of treating too many patients with complex conditions and losing money puts patients with complex conditions at risk. If physicians aren’t paid enough to cover the cost of treating too many costly patients, what will they do? Their incentive is to deliver as little care as possible to maximize their incomes.

    If private equity firms or corporate health insurers are receiving the capitated payments, the pressure is even greater to withhold as much care as possible. They also need to come out ahead financially. Anyone who thinks you can deliver value without measuring quality and handing a corporation a bunch of money upfront unrelated to the amount they spend on care is in lalaland. They have no evidence for their beliefs, just baseless claims.

    The Medicare Payment Advisory Commission has said over and over and over again for the last decade that it doesn’t have the complete and accurate data it needs to assess value in Medicare Advantage plans, corporate health plans paid a flat upfront payment by the government to deliver Medicare benefits. No data, no value. To make matters worse, the HHS Office of the Inspector General has reported that these “value-based” corporate Medicare Advantage plans are engaged in widespread and persistent inappropriate delays and denials of care and coverage.

    The Centers for Medicare and Medicaid Services (CMS), which oversees Medicare, does not and cannot measure quality in Medicare Advantage plans in a meaningful way. Consumer satisfaction studies and hospital readmission rates are hardly a guarantee of good care quality. To add insult to injury, CMS won’t even call out the bad Medicare Advantage actors. Instead, it gives some of them four and five star ratings and a financial slap on the wrist.

    Here’s more from Just Care:

  • Trump administration attempts to privatize traditional Medicare

    Trump administration attempts to privatize traditional Medicare

    The Trump administration is deep into rolling out a pilot plan that, over time, could privatize the public fee-f0r-service Medicare program unless the Biden administration hits the pause button on its implementation. Several open issues with this payment and care delivery or “Geo” model–a capitated payment system–highlight its ability to undermine access to care for millions of older and disabled Americans who might be forced into it.

    1. How can CMS ensure that capitated corporate plans regulating access to care for people in traditional Medicare won’t undermine quality of care or increase costs? Government audits indicate that capitated corporate Medicare Advantage plans systematically engage in widespread inappropriate delays and denials of care. They also overcharge the government for their services to the tune of billions of dollars a year. And, MedPac continues to report that taxpayers are paying more for them on a per capita basis than for people in traditional Medicare. Moreover, Medicare Advantage plans have not released accurate and complete encounter data, as required by law, which would allow a meaningful assessment of each of them.
    2. How will CMS effectively assess quality based on consumer surveys and “measuring outcomes?” Information from people who are relatively healthy is of little relevance as they don’t use the health care system much. The 20 percent of people with Medicare who are very ill or who need complex care will likely be unable to assess and report the quality of care they receive.
    3. How will the government know whether the GEO model improves quality without increasing costs over the short and long-term? How will CMS uncover fraud, detect inappropriate care, or identify practices that harm patients without this data?The model does not provide for a meaningful way for CMS to oversee the direct contracting entities (DCEs) that will be assuming full financial risk for all medical and hospital services people receive. It does not call for the DCEs to turn over encounter or claims data. 
    4. What protections will be available to people in Medicare who are forced into the GEO model if they are unable to get the care they need? The model does not allow them to opt out. Their out-of-pocket costs should not increase, but how will CMS know if they do?
    5. CMS suggests that the DCEs, corporations assuming full financial risk, can use “value-based” payments to providers. How will DCEs determine value-based payments? Will these payments lead physicians to delay and deny people needed care?
    6. Some people with Medicare need a substantial amount of care during the course of the year.  How will CMS know whether people with complex and costly conditions are getting the care they need rather than low-quality ineffective care or no care at all?
    7. Given that Medicare rates are already significantly lower than commercial rates, does CMS believe that high-quality providers will accept lower rates from DCEs? 
    8. How will CMS know whether DCEs are fostering health inequities, rationing care based on ability to pay and ability to navigate their complex system?
    9. What assurances are there that DCEs wouldn’t end up behaving like chain nursing home owners, pocketing the vast share of their government payments and leaving our nation’s most vulnerable people without access to care? How will they be held accountable if they do? Even if CMS were able to analyze every aspect of DCEs, DCEs can change their methodologies as they please when they please. 

    Everyone wants a healthcare system that improves quality and reduces costs. But, conducting this large scale costly social experiment with vulnerable older adults and people with disabilities seems imprudent and misguided at best.

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  • Gene therapy can offer a cure, but at what price?

    Gene therapy can offer a cure, but at what price?

    Pharmaceutical companies are coming up with cures for a range of diseases and disabilities, including blindness and hemophilia, but at what price?  Stat News reports that Sparks Therapeutics has a gene therapy that is well on the way to FDA approval and that could cost as much as $1 million.

    Luxturna is a gene therapy that is able to treat a condition in children that causes blindness. One teenager helped considerably by the therapy told an FDA committee: “Before surgery, my vision was dark. It was like sunglasses over my eyes while looking through a little tunnel,” and “I can honestly say my biggest dream came true when I got my sight. I would never give it up for anything. It was truly a miracle,” NPR news reports.

    To be clear, the therapy did not restore the vision of the patients in the clinical trial completely. But, after three years, their vision remained improved, for some considerably, for others less so. Some patients developed a serious infection from the treatment leading to permanent eye damage.

    Earlier this month, another type of gene therapy treatment was reported to work for patients with cerebral adrenoleukodystrophy, ALD, a rare brain disease that people die from.

    How does gene therapy work? Genetically-modified viruses are developed with special DNA. In the case of Luxturna, billions of these viruses, carrying healthy genes, are infused in a patient’s retina. These viruses can cure their condition through fixing molecular processes that are not working properly. But, they only work if people can access them, which means they need to be affordable.

    The gene therapy is not projected to work in all cases. So, the question becomes who will pay for it and under what conditions. Currently, some insurers are exploring what are called “value-based payment” models.  With these models, the pharmaceutical company only gets paid for its drug if it works. The devil is in the details though.

    With Car-T cell therapy, Medicare is working on a payment model that turns on whether the treatment puts the cancer in remission a month later.  But, some experts suggest that  the cancer may not remain in remission after six months, a year or two years. And, then Medicare has paid several hundred thousand dollars for a drug that ultimately did not work.

    With long-term value-based payment models, there are a number of challenges. People may change insurers and, then, who pays? Or, people may not be able to change insurers, locking people into coverage that they cannot afford or no longer covers care from their doctors. Or, people may not get the followup checkups needed to determine whether the gene therapy is working.

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