April 28, 2014

Can We Sustain Medicare While Making Health Care Affordable?

Mary MahoneyBY Mary Mahoney

J. Robinson Group Blog

Medicare became law in 1965 to provide health security for the nation’s elderly. About 19 million enrolled during the first year.  Nearly half a century later, millions and millions of baby boomers are following in their footsteps at a time when rising costs put health care out of the reach for many younger citizens.

This raises a fundament question: Can this United States sustain both Medicare and provide affordable care to everyone else?

According to the Congressional Budget Office, annual Medicare costs will reach over a trillion dollars by 2022, up from $556 billion in 2012. The Congressional Research Service forecasts Medicare will run out of money after 2024. Medicare costs already rob 15 percent of the federal budget, a share that has been increasing steadily.

Attempts to rein in Medicare have proved inadequate. The 1997 Balanced Budget Act included a provision to save $393.8 billion in health costs over 10 years by controlling growth and physician payments and expanding the role of private plans. That act kept Medicare somewhat in check, at least until 2007.

President Obama’s key domestic initiative, the Affordable Care Act of 2010, aims to ensure the Medicare Trust Fund’s solvency,  which is believed to have been assured until 2029 thanks to an initiative to reduce Medicare’s waste, fraud and abuse.

“While the ACA retained Medicare’s structure as an entitlement to a set of defined benefits, the law contains several provisions and changes to reduce projected Medicare spending by $716 billion over 10 years,” said the Kaiser Family Foundation in a report entitled “Policy Options to Sustain Medicare for the Future.”

The report suggests a number of policy options to sustain Medicare for the future including adjusting  existing payment rules for providers and plans or raising beneficiary cost-sharing requirements for specific services. This option is detailed in the PBS Need to Know article, “Medicare: Past, Present and Future.”

Bipartisan health-care reform reappeared in Congress at the end of 2013 when the Senate Finance and House Ways & Means committees releaseda framework to reform the Sustainable Growth Rate formula for physician payment in Medicare. The proposal builds on an earlier bipartisan bill passed by the House Energy & Commerce committee this summer.

“Permanent reform of Medicare’s physician payment system is urgently needed,” said Mark McClellan, MD, PhD, director of the Engelberg Center for Health Care Reform and Leonard D. Schaeffer Chair in Health Policy Studies at the Brookings Institution, in a Health Affairs blog, “Medicare Physician Payment Reform: The Bipartisan Congressional Proposal and How To Strengthen It.”

“No provider is more important than physicians in determining how patients are treated, yet Medicare’s physician payment system is based on a (Sustainable Growth Rate) formula that is not focused on quality of care and has not worked to reduce overall health care costs,” he said.

One of the bipartisan organizations dedicated to ensuring the long-term security of Medicare is the Partnership for the Future of Medicare, which also released reform recommendations last year for transitioning away from Medicare’s outdated fee-for-service payment model.

“It is well understood that traditional fee-for-service does not effectively support and incentivize high-quality care and it leads to costly care,” said PFM Co-Chair Doug Holtz-Eakin, Ph.D., in the organization’s report. “Replacing it is the right place for us to begin. It is central to reform and provides the opportunity for bi-partisan consensus.”

Kavita Patel, fellow and managing director at the Engelberg Center for Healthcare Reform at the Brookings Institution, commented on recent fee for service payments in a blog post, “How the Real World Can Influence Medicare Payment Reform.”

“Recent developments in Congress around reform of the Medicare Sustainable Growth Rate  have allowed for a broader dialogue on changes to physician payment,” he said. “This year’s looming physician payment cuts, approximately 24% and triggered by the dysfunctional SGR caps to Medicare spending, again threaten access to care for millions of patients across the country.

Bipartisan and bicameral legislation has now emerged to repeal the Sustainable Growth Rate, replace it with stable updates, and provides incentives to move physicians away from fee-for-service payment into alternative payment models such as Accountable Care Organizations.”

If you are a baby boomer or just want to stay current on Medicare, I highly recommend the Kaiser Family Foundation website and Kaiser Health News and its Daily Report, which summarizes health policy coverage from more than 300 news organizations.

April 14, 2014

Technology is Transforming Health Care in Life-Saving Ways – Part 1

Mary MahoneyBY Mary Mahoney

J. Robinson Group Blog

We all know how hard it is keeping up with technology. For instance, it seems every time we upgrade our phones, a new version is already launching. Technology in the health-care and medical world is changing everything, from how we keep track of medications to the way doctors interact with patients to the way researchers look at treatments and cures for life-threatening diseases – all at lightning speed.


So just how fast is technology changing the medical world? If you are talking about cutting-edge, life-changing technology, you have to start with Watson. In 2011, IBM debuted an artificially intelligent supercomputer named Watson with the “goal of creating a question-and-answer technology that would be more authoritative and powerful than anything on the planet,” according to an article in Fast Company magazine, which focuses on innovation in technology.


The supercomputer specifically was developed to answer questions on the game show Jeopardy! (it won, by the way). IBM executives then decided to “focus on a field in which Watson could have a notable social impact while also proving its ability to master a complex body of knowledge.” Choosing medicine, they believed Watson could help doctors make diagnoses and select treatments, according to the Fast Company article, “IBM’s Watson is Learning its Way to Save Lives.”


Today, a prototype of Watson is analyzing genetic data along with drug databases and biomedical journal articles to revolutionize how certain rare cancers are being treated, according to a MedCity News article, “In Watson’s Latest Healthcare Technology News, it Takes on Personalized Brain Tumor Treatment.” Working with the New York Genome Center, IBM and Watson will focus on glioblastomas, the most common and aggressive malignant primary brain tumor that kills more than 13,000 Americans each year.


“The real challenge before us is how to make sense of massive quantities of genetic data and translate that information into better treatments for patients,” said Dr. Robert Darnell, president and scientific director of the New York Genome Center. “Applying the cognitive computing power of Watson is going to revolutionize genomics and accelerate the opportunity to improve outcomes for patients with deadly diseases by providing personalized treatment.” Watson learns as it processes new information, so the goal is to increase the number of patients who have access to care options tailored to their disease’s DNA.


IBM and Watson also are collaborating with other institutions to choose the best individual treatment plans for cancer patients and improve the quality of care, no matter where they are located. Indiana-based health insurance company WellPoint has begun using a Watson computer to speed authorizations for medical procedures. A hospital in Maine is teaching Watson how to interpret clinical information to diagnose and make decisions in lung cancer treatment.


Through a project called WatsonPaths, IBM Research continues to push the boundaries of Watson by “developing new interfaces that will allow humans and computers to interact more naturally,” which is expected to help physicians make more informed and accurate decisions faster by mining electronic medical records.


In my next blog, I’ll look at how technology is affecting everyday health care including doctor and patient interactions, self-monitoring of individual health conditions and keeping track of daily health.

April 7, 2014

The High Cost of Chronic Health Conditions

Mary MahoneyBY Mary Mahoney

J. Robinson Group Blog

Chronic diseases including heart disease, cancer, asthma and arthritis are the single-greatest threat to our nation’s health and health-care system.

My last blog explored the impact of chronic disease on the daily health, quality of life and lifespan of the 157 million of Americans with such conditions. What about the toll chronic disease takes on our health-care system and economy? Which diseases are the costliest? Are there new treatments, protocols or programs to help them from being such a burden on patients and the health-care system?

Chronic diseases including heart disease, cancer, asthma and arthritis are the single-greatest threat to our nation’s health and health-care system, according to the Partnership to Fight Chronic Disease. The cost of treating patients with chronic diseases accounts for 75 percent of the nation’s health-care spending. Two-thirds of the increase in health-care spending is due to increased prevalence of treating chronic disease. For individuals and families with chronic diseases, medical bills are a leading cause of bankruptcies.

Heart conditions top the list of costliest diseases at $312.6 billion annually in health-care expenditures and lost productivity, according to the American Heart Association. This includes more than one in three – or 80 million — Americans who are being treated for heart conditions, stroke, peripheral artery disease and high blood pressure. Treatment of these diseases accounts for $1 of every $6 spent on health care in the United States.

According to Million Hearts, a national initiative to prevent one million heart attacks and strokes by 2017, “the cost to families who experience heart disease or stroke not only have to deal with medical bills but also lost wages and the real potential of a decreased standard of living.” The program, launched in 2011, is co-led by the Center for Medicare & Medicaid Services and the Centers for Disease Control and Prevention along with other government agencies.

It’s not new news that cancer is expensive. While heart disease ranks first in overall health-care spending, cancer ranks number one as the most costly disease per person. More than 13.7 million Americans had or have some form of cancer. That number is expected to grow to 18 million by 2022 according to the American Cancer Society. The total direct medical cost related to cancer patients is $86.6 billion, and the total indirect cost of $216.6 billion is attributed to lost productivity due to premature death, according to the National Institutes of Health.

The good news is that advancements in technology and treatments have lengthened lives, and cancer deaths have decreased in the last few years. The bad news is that these treatments come at a high cost. New cancer drugs often cost $100,000 or more a year. Patients are being put on them sooner  and for a longer time — sometimes for the rest of their lives, according to Cancer’s Growing Burden: The High Cost of Care, in USA Today. Radiation treatment, for example, is becoming more high-tech, and “each leap in technology has brought a quantum leap in expense,” according to Chronic Diseases: An Impending Social Disaster and its Crippling Costs, in FinancesOnline.com.

The United States is putting its money and efforts into awareness, prevention and management programs to help everyone stay healthy, whether they have a chronic disease or not. The Partnership for Chronic Disease points to a Milken Institute study that estimated modest reductions in unhealthy behaviors could prevent or delay 40 million cases of chronic illness per year.

In terms of protecting yourself and your family from the financial costs of chronic disease, here are some suggestions applicable to all chronic conditions from WebMD: research your medication and find generic substitutes or assistance programs for discounts; check your health insurance policy and learn exactly what it does and doesn’t cover; and consider disability insurance in the event you ever become disabled by a disease and can’t work.

Ask your doctor about the best ways to protect yourself from high health-care costs. You can be sure the advice will include “eat right, exercise and don’t smoke and drink!”

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