Information Advantage Group Newsletter May 2011


Published on

A compilation of essential news for the ACO Medical Home markets.

Published in: Health & Medicine, Business
  • Be the first to comment

  • Be the first to like this

No Downloads
Total views
On SlideShare
From Embeds
Number of Embeds
Embeds 0
No embeds

No notes for slide

Information Advantage Group Newsletter May 2011

  1. 1. Information Advantage Group’s Healthcare Digest is focused on the emerging deliverymodels for the hospital to consumer continuum. In a fast-read format, we provide onlythe vital news that is essential to keeping you current on the latest and most germanetrends, ideas, results, technological developments and resources.Simply click on a category relevant to you below to jump to the news topics, click on theLinked Topic Title to be taken to the source article. Most sources are publiclyavailable; you may have to subscribe for others. Innovation Trend Drivers HIE ACO Trends Physician & Consumer & Oversight & Medical Home Professional Caregiver InfluenceInnovation Trends: Clearly the trend toward hand-held healthcare and remote care devices that the patient or a home caregiver can use is adding to the digital growth curve. Telehealth continues to get more attention with the VA continuing to prove the benefits of the technology that is leading to its vigorous expansion of pilot programs. Together, high tech, medical device, traditional telehealth and telecommunications interests may amass a strong lobbying effort to secure better reimbursement. Without reimbursement, the anticipated “consumer miracle” in not showing signs to be strong enough to drive the market.Digital Is The Only Growth Medium For NewsAccording to the Pew Research Center study, The State of the News Media 2011, peopleare spending more time with news than ever before, but when it comes to the TOC
  2. 2. platform of choice, the web is gaining ground rapidly with digital news being theonly media sector seeing audience growth. The December 2010 showed:  41% of of US citizens polled said the internet is where most of their news about national and international issues came from, up 17% the previous year.  46% of people now say they get news online at least three times a week, surpassing newspapers for the first time.  Cable news joined the ranks of older media suffering audience decline.The study suggests control of the data will be one of the bigger issues. Todeliver news in the digital world, content must fit the rules of device,software and transport vendors. This gives them some control over the audienceand also access to the revenue steam. The implication for healthcare is thatpatient and caregiver preferences for content and engagement will continue toescalate the need for digital technologies.AMA Ethics Forum: “Lemon Dropping” of Patients MayIncrease Due To Electronic Medical Records[NOTE: "Lemon-dropping" or "dumping" = The termination of care for a patient because theyare difficult, costly, elderly, have multiple chronic medical problems, low health literacy orotherwise unwanted patients.]In an AMA Ethics Forum response, Jim Bailey, MD, MPH and Carson Strong, PhD (bothprofessors, Dept. of Medicine, University of Tennessee Health Science Center) discussedthe concerns on how the practice of "lemon-dropping" over the past 20 years hasadded to rising health care costs. They suggest that the adoption of electronicmedical records and analytics offers a powerful way to mine data and assist inselection of optimally profitable patients - federal privacy regulations do notspecifically prohibit these activities by physicians.The authors state that patient selection of this sort is unethical because:  These practices are expected to increase both taxpayer and employer-funded health care costs.  Continuity of care is disrupted and can produce adverse health outcomes, particularly for our most vulnerable citizens.  Unfair competitive practice: providers who do not engage in these practices will care for a disproportionate number of sicker, more costly patients.(AMA Ethics Forum, April 18, 2011) 2 TOC
  3. 3. Telemedicine and Diabetes Monitors To Show GreatestGrowth in Global Home Health MarketAccording to a new healthcare market researchreport ‘Home Healthcare Market (2009-2014):  The home telemedicine services market is forecasted to show a 32% CAGR from 2009 to 2014.  Diabetes devices alone constitute about 46% of the entire home healthcare equipment market, while the market for home therapeutic equipment is the fastest-growing segment with a CAGR of 19.4%.  In 2009, the global home healthcare market is estimated to be approximately $159.6 billion in 2009.  The home healthcare services market is estimated at $143.1 billion, about 90% of the entire market is expected to grow to $207.0 billion by 2014  A shift of patient’s focus from hospitals to home care is affecting a rise in proactive monitoring opportunities.  Patients prefer home healthcare over hospitals mainly for the latter’s cost and convenience benefits; and are thus increasingly opting for third-party medical professionals and caregivers.  70% of revenues are from those aged 65 years and older.Hot Consumer Product - Home DefibrillatorsMarket research publisher Kalorama expects home usedefibrillators will be the number one growth item in thehome care products industry through 2014.  The home care products market is expected to grow by only 2.2% through 2014, the home defibrillators segment is expected to grow at a whopping 17.1% during the same period.This growth is seen as indication of the willingness of consumers to take on theresponsibilities for sophisticated medical procedures performed at home. In theU.S. an estimated 18 million people receive some kind of home health care from 3 TOC
  4. 4. either professional or unpaid caregivers, and most of these individuals require home careproducts.VA Invests $1.38 Billion In Drive Toward AdvancingTelehealth ServicesContinuing with its trend toward telehealth and a 2010 budget increase of 50%over 2009, the Department of Veterans Affairs awarded contracts to six ITvendors to run its massive telehealth program for the next five years.The prize: About $1.38 billion in VA telehealth contracts. The individual vendor contractsrun anywhere from $150 million to $372 million over the five-year period, The smallest ofthe new contracts--$150 million is just shy of the agencys entire telehealth budget of $163million last year. (Fierce Mobil Healthcare, April 14, 2011)VA Moves Toward Patient Hand-Held Communication DevicesThe Department of Veterans Affairs is now piloting a handheld device veteranscan use to contact their primary-care providers. Veterans can use the softwareto communicate with clinicians and also store personal, military and family healthinformation. VA officials say theyre hoping that on the clinical side, the technology willhelp treat conditions like post-traumatic stress disorder and traumatic brain injury. (FierceMobil Healthcare, February 1, 2011)VA Sees Remote ICU Telehealth Monitoring By CliniciansReducing Mortality And Length Of StayA literature review of thirteen studies conducted between 2004 through 2010 andcovered 41,374 patients at 35 ICUs across the country by Veteran Affairresearchers showed:  20% reduction in mortality a length of stay by 1.3 days through the use of telehealth services to monitor ICU patients.Telehealth interventions included: videoconferencing, telemetry and remote access toelectronic medical records that enabled off-site ICU clinicians to intervene early and helpguide treatment.64% Of Docs Using SmartphonesA new survey of 5,400 physicians from Knowledge Networks for the pharmaceutical industryfound: 4 TOC
  5. 5.  64% of physicians use a smartphone  27 percent of primary care providers and specialists say they have a tabletThis somewhat confirms a mid-2010 Manhattan Research survey that found that 72% ofphysicians in the US used a smartphone or PDA. (Mobihealthnews March 31, 2011)Physicians Love The iPhone, But iPad And Android AreStarting To Get Their ShareAlthough Neilson recently crowned Android devices as dominate in the consumermarket, Apple’s iPhone and iPad still hold a commanding lead over all competingplatforms in the physician market. Bulletin Healthcares analysis of 550,000 healthcareproviders, including more than 400,000 physicians who subscribe to their daily emailbriefings between June 1, 2010 and February 28, 2011 and accounts for roughly half of thepracticing U.S. physicians found:  Mobile consumption of medical news climbed by 45% between June and February.  30% of healthcare professionals now access the daily medical information on mobile platforms, compared to 70% using traditional desk platforms.  The iPhone and iPad combined accounts for more than 90% share of use in February, Android 6% and all others, including RIM and Palm, barely registered.  Share changed - iPhone use fell to 79%, from 86% in June 2010, while iPad share nearly doubled to 14% in February 2011, up from 8% in the previous June.  Devices based on Google’s® Android operating system more than doubled their share between June and February.Mobile device use by specialty showed:  Physician Assistants – 41%  Emergency Room Physicians – 40%  Cardiologists – 33%  Urologists – 31%  Nephrologists – 31%  Dermatologists – 30% Gastroenterologists – 30%  Psychiatrists – 28%  Optometrists – 28% 5 TOC
  6. 6.  Radiologists – 24%  Rheumatologists – 22%  Endocrinologists – 21%  Oncologists – 20%  Clinical Pathologists – 16%(Medical, April 6, 2011)American Telemedicine Association Calls For Removal OfTelemedicine RestrictionsRecommendations include:  Medical videoconferencing for the 35 million beneficiaries who live in metropolitan areas,  Store-and-forward of medical images for the 43 million beneficiaries who dont live in Alaska or Hawaii,  Physicians to judge the appropriate ACO use of telemedicine for otherwise covered services,  Home-based medical videoconferencing, and  Otherwise covered therapy services to be delivered via telehealth.(ATA, April 25, 2011)2011 – Surge In Wireless Point Of Care Mobile DeviceApprovalsWith the FDA giving 501(k) clearance to Abbott’s i-STAT 1 Wireless point-of-care blood analyzer, it becomes the fourth wireless-enabled medical device toreceive FDA clearance this year and joins Ascom, Monica Healthcare and Mobisante.The wireless model allows the transmission of data from the hospital bedside to a centralcomputer allowing physicians to receive immediate test information in the electronic medicalrecord. We can only surmise how helpful this will be in the medical home/remote monitoringmodel. Abbott there are about 50,000 i-STAT devices are in use worldwide and theyprocess about 100 million test cartridges annually.As to mobile software applications (apps), the FDA has cleared more than a dozen softwareapps for mobile devices over the years including one this year: Mobile MIM.(Mobihealthnews April 3, 2011)Top 5 Apps at Harvard Medical SchoolWhile Harvard Medical School does not distribute mobile devices or recommends 6 TOC
  7. 7. applications to its students, however, they think it’s OK for them to use theirfavorites. The school’s CIO, John Halamka , surveyed their medical students andresidents to find out just what they are using most. The five apps include: Dynamed – A clinical reference tool created by physicians for point-of-care situations and CEU. Unbound Medicine uCentral – Aggregates popular medical publications to an iPad including: 5 Minute Clinical Consult, A to Z Drug Facts, Drug Interaction Facts, and others. VisualDx Mobile – Physician-reviewed clinical reference with medical images showing the variation of disease presentation through age, stage and skin type. Epocrates Essentials – A workhorse all-in-one mobile reference guide covering drugs, disease, conditions, diagnostic and laboratory tests and OTC products. iRadiology – A quick review of classic radiology cases and images for medical students and residents.(Mobihealthnews, April 19, 2010)Health Games May Prove To Be Very HelpfulA new category - Health Video Games - is showing early signs of showing valuethan though before, according to a Journal of the American Medical Association (JAMA)article. Games that have a motivating narrative that moves users toward definedgoals, provides clear feedback, awards points, delineates levels of competition,encourages teamwork and trading, and in some cases, uses an avatar to representthe player move them past casual entertainment. Some data on efficacy doesexist:  77% reducing of diabetes related ER visits over six months by users of Packy & Marlon--an older Nintendo - . The game allows players to inhabit a character with Type I diabetes, perform glucose testing, make food choice and perform other activities to manage his condition.  Another study in the March issue of Archives of Pediatrics & Adolescent Medicine found that a segment of six highly active video games provide the equivalent of anywhere from moderate to vigorous exercise, and keep kids off the couch.Creation of The Robert Wood Johnson Foundations Health Games Research Initiative isintended to vet health games effectiveness and thus applicability to the $10 billion set asidein the Affordable Health Care Act for disease prevention and education. (Fierce MobileHealth, April 6, 2011)Healthcare IT Consolidation Sets Record -Stocks Outperform 7 TOC
  8. 8. And M&A Volume Set All Time High.Health Growth Partners (HGP), Q1 report on healthcare’s IT vendor market shows:  Healthcare IT stocks outperformed broader markets during the first quarter with a doubling of returns seen from the S&P 500.  HGP Payer Index was the performing index, which posted gains of nearly 30% during Q1, 2011.  Healthcare IT and services M&A posted its strongest quarter on record. Transaction volume during the quarter was 33% higher than the quarterly average in 2010, which was 36% higher than 2009.M&A trends include:  The ACO movement and other integrated payment models is driving investment in data collection, transport, storage, analytics, and care management technologies,  Large enterprise and non-traditional HIT companies are aggressively pursuing a stronger foothold in this sector with acquisitions,  Healthcare reform has payors advancing new HIT strategies that address risk and data management and the medical loss ratio in the coming environment, leading to heightened interest in acquisition and investment,,  The HITECH Act continues to drive spending for new applications in an effort to meet Meaningful Use requirements, and  This favorable market has attracted private equity investors looking to capitalize on it.(HGP April 20, 2011)NEWLY RELEASED - HELPFUL INNOVATION TRENDS RESOURCESHealthcare Information Technology and Related ServicesQuarterly Market Report Q1 2011 - An excellent summary of healthcare ITmarket activity from Healthcare Growth Partners an investment banking services company.Meaningful Use Crib Sheet – Physician PerspectiveHITRUST FRAMEWORK - Developed in collaboration with healthcare andinformation security professionals, the Common Security Framework (CSF) is the firstIT security framework developed specifically for healthcare information.HITRUST offers a series of videos to provide an introduction to the CSF and relatedprograms. It is only through registering for a subscription that individuals can access theCSF. A FREE Standard subscription at no charge is available to any organizationemploying a function or activity involving the use or disclosure of individually identifiable 8 TOC
  9. 9. health information, provided that said organization does not provide technology or securityproducts or services. 9 TOC
  10. 10. Trend Drivers: With a slow return to positive economic signs, it’s still not enough to overcome people having higher copays and not having enough money to pay for healthcare or retirement. With quality improvement efforts over the last decade barely improving the cost curves, there is a question of whether the new models of healthcare will help – early ACO results (later in the newsletter) say yes!Consumer Sentiment Turning UpwardOn April 29, 2011 the Universityof Michigan as its revisedconsumer confidence indexdid better than expected forApril, increasing a bit to69.8 from the 67.5 Marchlevel.Banks Starting To Lend More - A Key Ingredient For FutureGrowth In The Economy.Banks are beginning to show anuptrend in lending activity.Although only growing at a 7%annualized rate since December,it is seen as the beginning of anew lending cycle brought aboutby increased confidence on thepart of banks and businesses.(Seeking Alpha. April 20, 2011)Inflation Remains Low– Healthcare At3%...Same As Food 10 TOC
  11. 11. Labor Department reports pointto fast rising energy and food costsdrove consumer prices 0.5% higherin March, just like the prior threemonths, and, on a year-over-yearbasis.  Overall inflation is at 2%, the highest level since December 2009s 2.8%.  Inflation has been running at 6% for the last quarter and 4% for the last six months.  Healthcares 6.5% contribution to the CPI is showing about a 3% inflation rate year-over-year, almost the same as food and beverage.  The WSJ touted “Underlying Inflation Remains Tame”  Concerns center on another few months like the most recent may be replace price declines in early 2010 with big increases and shoot the CPI sharply higher.(Seeking Alpha, April 15, 2011)WSJ: Deloitte Macro Survey - 20% Serge in RevenuesNeeded To Trigger Substantial Hiring...Its Not All BadDespite corporate earnings showing double-digit gains for the last six quarters, a quarterlyDeloitte poll completed at the end of February of 77 CFOs of mostly $1 billion annualrevenues public and private companies in the U.S., Canada and Mexico showed:  Almost 50% would want to see a 20% increases in earnings to substantially stimulate hiring.  Only 11% thought that a 10% increases in revenues would produce hiring.  Those surveyed estimated only a line growth for North American to be 8.2% this year, up from Q4 estimates of 6.5% for 2011.  Healthcare Mention: Not even a major revision to the healthcare reform or incentives like lower corporate tax rate or payroll tax would stimulate CFOs to add employees.Department of Labor numbers appear to support these results. February job openings raterose to 2.3% from 2.1% a month earlier and a total of 3.1 million jobs at the end of February- unemployment remains around 9%. (WSJ April 14, 2011) 11 TOC
  12. 12. Patients Not Buying As Many Prescriptions MedicationRecent slowing of growth in sales ofprescription drugs was attributed tofewer doctor visits and fewer peoplestarting new therapies according to anew study from IMS Institute forHealthcare Informatics. IMS attributedthis drop to high unemployment levels andthe rising costs of healthcare motivatingpatients to spend more conservatively onhealthcare. Highlights of the study include:  Patients made 4.2% fewer visits to doctors in 2010.  Sales of prescription drugs in the United States grew just 2.3% in 2010 ($307B total spent), down from 5.1% growth rate in 2009 ($300B total spent), On a real per capita basis spending increased by 0.6% compared to a 3.1% increase in 2009, $898 per person in 2010, up from $876 in 2006  The total number of patients starting new treatments for chronic conditions fell by 3.4 million compared to 2009(IMS, April, 2011)$17 Billion In Harmful Medical InjuriesA study published in Health Affairs (April, 2011), looks specifically at measurablemedical errors that harm patients—a subset of medical injuries—and examines directmedical costs, rather than indirect costs, such as malpractice insurance premiums.Highlights of the examination include:  Measurable medical errors that harmed patients cost an estimated $17.1 billion in 2008, or 0.72% of the $2.39 trillion spent in the U.S. on healthcare that year.  10 errors are accountable for 69% of the total medical cost for measurable medical errors, the researchers noted.  In first place, postoperative infections were the most costly error, totaling $3.3 billion in medical costs, followed by pressure ulcers at $3.2 billion.The other eight errors included:  Mechanical complications of non-cardiac device implant or graft—$1 billion total medical cost; 12 TOC
  13. 13.  Post laminectomy syndrome—$995 million total medical cost;  Hemorrhage complicating a procedure—$678 million total medical cost;  Infection due to central venous catheter—$589 million total medical cost;  Pneumothorax (collapsed lung)—$569 million total medical cost;  Infection following infusion, injection, transfusion or vaccination—$566 million total medical cost;  Other complications of internal prosthetic device, implant and graft—$398 million total medical cost; and  Ventral (abdominal) hernia without mention of obstruction or gangrene—$342 million total medical cost.(CMIO, April 19, 2011)Most Healthcare Is Paid With Other People’s MoneyIn response to a Paul Krugmansrecent opinion piece in the NY Timesthat Patients Are Not Consumers,Dr. Mark J. Perry, professor ofeconomics and finance at Universityof Michigan, argues that risinghealthcare costs will not becontrolled until we do treatpatients as consumers.Dr Perry argues that over time,most of healthcare has graduallybeen paid with other peoplesmoney:  Almost 90% of health care costs are paid by third parties (insurance companies, government and employers) and only about 11% is paid "out of pocket" by patients.  Consumer health models have been successful and we need to look no further than lasik surgery, retail health clinics, concierge medicine, medical tourism and cosmetic surgery, to name just some of the successful "consumer-based" medical services?(Carpe Diem, April 22, 2011)Growing Number of People Won’t Have Enough To Retire 13 TOC
  14. 14.  53% of non-retired Americans do not think they will have enough money to live comfortably in retirement, up 40% from 32% in 2002.  28% say they will retire before age 65 - down 40%, from 47% in 1995 .(Marketing Charts, April, 2011)Most Support Raising Taxes AND Leaving Medi/Medi AloneThe recent national survey of 1,274 US adults by McClatchy-Marist showed:Overall support for raising taxes rose 5%: 64% approved raising taxes on incomesabove $250,000 – 64% independents, 83% Democrats and 43% of Republicanssupported higher taxes80% of Americans clearly dont want the government to cut Medicare or Medicaid-even among conservatives, 68% opposed cuts to these programs.(McClatchy, April 18, 2011)Robert Wood Johnson Thinks Economies Of Scale RatherThan Risk Will Drive Insurance ExchangesA Robert Wood Johnson brief concludes multi-state insurance exchanges are mostlikely to be structured on shared administrative structures and efficiencies ratherthan risk. Economies of scale, large metropolitan areas that cross state lines, poolingacross state line and establishing critical mass for stable risk pools are reasons detailed inthe brief. (Robert Wood Foundation, April 2011)Health Affairs Policy Brief - Improving Quality And Safety IsStill Glacial 2.3%Despite multiple efforts since the IOM report a decade ago, quality improvementthroughout much of the US health care system is still proceeding at a glacialpace, if at all. The recently published National Healthcare Quality Report by the Agencyfor Healthcare Research and Quality (AHRQ) reveals that in 2009, while nearly two-thirds of 179 measures of health care quality did show improvement, the medianannual rate of change was only 2.3 percent. This briefing offers a comprehensivereview of past quality measures and current regulations - a good foundation piece. (HealthAffairs, April 15, 2011) 14 TOC
  15. 15. NEWLY RELEASED - HELPFUL RESOURCESThe Direct Project - Office of the National Coordinator for Health IT (ONC) hasreleased “The Federal Health IT Strategic Plan: 2011-2015," an 80-page last published in2008. 15 TOC
  16. 16. HIE It remains to seem like the early days for HIEs, parties still thinking about when, what and which vendor to choose to reach quality of care goals. Not so obvious are the concerns for financial sustainability for the HIE after funding runs out.KLAS Health Information Exchange StudyAn Over view of drivers, HIE vendors and buyers preferences shows:  32% would choose a HIE vendor within twelve months,  Only five of 38 vendors mentioned are mentioned more than 10% of the time,  Public, Cooperative and Private HIEs are the leading buyers types, each with their own unique needs,  Epic is the vendor for HIEs that are planning to include 15 or more hospitals, Medicity and Axolotl seem to be popular among smaller HIEs,  Technology (38%) and cost (23%) are the overwhelming leaders in selection criteria, merely 5% of see meaningful use as a key criterion for HIE vendor selection, and  Improving the quality of care (62%) is the main driver for forming an HIEs, savings (26%) comes in at a distant secondNEWLY RELEASED - HELPFUL HIE RESOURCESHIE Toolkit by eHealth InitiativesCMS: Meaningful Use Calculator Measures Steps Taken ToMeet Requirements -E-prescription Systems Market to Reach $204 million - The U.S.e-prescription market is projected to reach $204 million, according to a new report by GlobalIndustry Analysts (GIA). With 4.5 billion prescriptions being written annually, the growth rateof prescriptions being written, errors and adverse drug events are the major drivers. 16 TOC
  17. 17. ACO Motivations and expectations of those planning for an ACO are being pulled by good early results from efforts like CALPERS and Cigna. On the other hand, the proposition of an ACO is being scrutinized, if not disparaged, by large advisory consultancies. Accurate monitoring and analysis are driven by strong concerns for financial viability and appropriate population management. Again, I.T. needs are anticipated to be a challenge and a key ingredient for success.The Leap To Accountable Care Organization SurveyAn April 2011 Survey of provider management about ACO plans and perceptions byMedLeaders show that 64% think health quality will improve and 32% think FFS with sharedrisk will be the best payment structure. Other highlights Include:  91% do not have an ACO,  64% are planning to have an ACO,  52% have no operational target date, 30% think 2012, and  48% think the medical staff supports an ACO, 45% not sure.What will the ACO include:  80% clinical pathways,  74% care coordinators & RNs, and  70% Medical Home.What are the drivers for an ACO:  72% better clinical integration,  60% risk shifting to providers, and  57% market competition.What are the barriers: 17 TOC
  18. 18.  43% risk of inadequate payment rates,  34% lack of good EMR/IT, and  26% physician resistance.(HealthLeaders Survey, April, 2011)NEFM: What Might We Expect From An ACO?This NEJM perspective article includes asking, "What can we reasonably expect of thecoming wave of ACOs?" Although not all past models of quality improvement andshared savings have worked as expected, they point to the Medicare PhysicianGroup Practice (PGP) Demonstration to get some ideas on what we might expect:  All ten participants in the PGP demonstration met at least 29 of the 32 quality goals, which focused on process measures related to CAD, diabetes, CHF, hypertension and preventive care.  60% of the demonstration sites produced savings amounting to $78 million in Medicare expenditures.(NEJM, March 31, 2011)CALPERS To Expand It’s ACO Pilots Based On PositiveOutcomes – Anticipates $15.5 Million In SavingsCalPERS launched it’s ACO pilot that involves 41,000 members in January 2010 inpartnership with Blue Shield of California, Catholic Healthcare West and Hill PhysiciansMedical Group. Early results from the January to October, 2010 period show:  50% reduction in the number of patients hospitalized for 20 days or more,  17% reduction in hospital readmissions,  A 14% reduction in total inpatient days, and  A half-day reduction in the average length of inpatient hospital staysAs a result of the positive patient outcomes, CalPERS said it expects to expand the pilotACO program for Blue Shield enrollees. (California Healthline, April 13, 2011)Positive Results Drives Cigna To Double It’s ACO PilotsCigna has announced plans to double its ACO pilot programs due to good results inquality improvements and cost cutting since first stared in 2007. Successes at 18 TOC
  19. 19. their Cigna Medical Group of Arizona and since 2008 at Dartmouth-Hitchcock MedicalCenter have shown:  Annual savings of $336 per patient  11% reduction in the cost of ambulatory surgery  A rise of 3% in the number of preventive care visits that includes an increase of 12% for adults and,  A 10% improvement in closing gaps in care due to the care coordinator monitoring patients for follow through on appointments and medical tests.Cignas model is slightly different than the commonly though of ACO program dueto it being structured on patient-centered medical home tenants andcommitment to frequent and open collaboration and communication. Cigna currentlyhas 12 initiatives across 11 states, involving 100,000 Cigna customers and 1,800physicians. (FierceHealth, April 1, 2011)Deloitte Thinks A Low Percentage Of Beneficiaries Will BeIn An ACOA critical read by Deloitte Center for Health Solutions of the March 31, 2011, HHS proposedregulation on accountable care organizations assumed that:  Only 11% of Medicare beneficiaries would participate in an ACOs, about five million - on page 352, however, the guidance suggested a lower range of 1.5-4.0 million.The Center observed that some provider communities will possibly choose to createclinically integrated delivery systems through other means like episode-based paymentsand medical homes and other payment models the new Center for Medicare and MedicaidInnovation may propose. The Center urged providers considering forming an ACO toconsider three questions:  "Do you want to create a clinically integrated delivery model in which physicians, hospitals, long-term care and allied health professionals join together in a formal structure to assume risk for costs and outcomes?"  "Are you prepared to make investments in infrastructure and changes in operations to achieve optimal results?"  "Do you have the core competencies to manage population-based outcomes and costs, as well as the associated insurance risk? Or should you outsource these functions?" 19 TOC
  20. 20. The review goes on to make ten other points about ACO plans that include:  Savings could exceed estimates: An ACO performing in the 10% is expected to save 0.7 percent on its Medicare expenditures, or $960 million. If an ACO optimizes quality and savings potential, they could keep as much as 60 percent of savings above a 2% threshold.  Although the law states an ACO needs minimum of 5,000 Medicare beneficiaries to qualify, 20,000 would scale better.Read the report by the Deloitte Center for Health Solutions on ACOs. (Beckers HospitalReview, April 5, 2011)Hierarchical Condition Categories (HCC) Can Under PredictACO ExpensesAs a follow up to “The ACO Model – A Three-Year Financial Loss?” article in the March NewEngland Journal of Medicine about Medicares Physician Group Practice (PGP) ACOdemonstration project that operated from 2005 through 2010, Singletrack Analytics, afinancial consulting group, had a couple of observations about how cost sharing paymentswere calculated and where the best successes were found:  Four practices that received payments and were either affiliated with an academic center or freestanding physician groups did well.  Possibly having a hospital as part of the mix was hypothesized as a potential "deterrent to achieving savings" because of the effect of reductions in admissions under ACO practices on the hospital’s revenue.  Those who failed showed a lack of alignment of financial incentives between managed care organizations and hospitals, similar to the 1990s when this was the principal cause for the failure of many of these affiliations.  The four PGPs that earned cost-sharing payments in the second year showed that they operated at the same level as pre-demonstration period - they were winners before the project even started.The article goes on to discuss how under the PGP project, the targets were set based onHCCs, which are common payment adjustments currently used for reimbursement andvery likely to be utilized for ACOs. A previous study found that HCCs under-predictthe expenses of Medicare beneficiaries with both CHF and osteoporosis by about30%, and by about 20% for patients with CHF alone. The amount of under-prediction increased as the functional status of the patients decreased.Singletrack Analytics went on to recommend that groups having a large proportionof patients with multiple chronic conditions risk being underscored for those 20 TOC
  21. 21. patients. Such groups may be "born losers" having little opportunity for financialsuccess in an ACO. (Beckers Hospital Review, April 1, 2011)ACOs May Negatively Impact Medically UnderservedCommunitiesA report by The George Washington University School of Public Health and Health Servicesadvocates that when it comes to ACOs, underserved communities are at a disadvantagebecause the Affordable Care Act prohibits health center-formed ACOs from partaking in theMedicare Shared Savings Program and the assignment of Federally Qualified HealthCenters (FQHC) Medicare patients to ACOs for shared savings reasons.According to the report, the Accountable Care Act negatively impacts the poorestbeneficiaries who are often at the highest health risks, penalizes medicallyunderserved communities that lack primary care physicians, discourages healthcenters affiliation with hospitals and specialty practices and impacts the abilityof health center patients to participate in other shared savings programs, such asMedicaid and CHIP.(George Washington University School of Public Health, April 20, 2011)AMGA Puts Some Distance Between It And Proposed ACORegsThe American Medical Group Association takes credit for getting accountable careorganization provisions included in the Patient Protection and Affordable Care Act- it is now distancing itself from the proposed ACO regulations recently issued atthe end of March 2011 by the CMS. The association claims to actively formulatingformal comments and urges members to submit comments of their own to the CMS.Heritage Foundation Thinks ACOs Will FailIn a long briefing, The Heritage Foundations states that given the complexity ofhealthcare, ACOs will not only fail , but most likely exacerbate the very problemsthey are trying to fix. In their view, the guidelines are untested and vague and fall shortbecause they:  Do not empower consumers to be stakeholders in their own care.  Do not encourage provider accountability.  Create an unfair competitive advantage for large organizations.(The Heritage Foundations, April 18, 2011Six Technology Essentials for ACO Infrastructure 21 TOC
  22. 22. A General overview of what IT infrastructure is needed for an ACO including:  Financial Infrastructure: Validate budget goals based on beneficiary population, track performance payments received and administer chosen payment methodology (such as shared savings) to participating providers,  Reporting Infrastructure: Monthly performance reports, population management trends such as disease and case management, and utilization and practice variation reports,  Performance Management: Disease-specific dashboards, comparison of actual results to benchmark data and performance targets, and adherence to evidence- based medicine,  Data Aggregation: Aggregation and sharing of administrative and clinical data from disparate sources, and shared disease registry accessible and enriched by all participants,  Clinical Data Exchange: Hospital shares detailed procedure information and discharge plan with a patients primary care physician, and physician shares outpatient care history with the admitting hospital, and  Role-Base Security: Access to aggregate cost and quality trends by governance and project teams, secure repository for shared aggregate and detailed data, and sharing of patient-specific clinical data between responsible caregivers.(Becker Hospital Review, April 27, 2011)Advisory Board: Buyer Beware Of Vendors Claiming FullFeatured ACO Systems – “Lots Of Kool-Aid Going Around”Jim Adams, managing director at the Advisory Board Company consultancy andveteran leader of HIMSS Analytics, thinks that even hospitals at the mostdeveloped stage of healthcare I.T. are not ready for ACOs. He sees ACOs willrequire a lot more I.T. horsepower than just a working EMR. Strongconnectivity; data warehousing, analytics and predictive modeling technologysupporting disease, care and utilization management applications are essential.Identifying opportunities to reduce costs, disseminate payment and calculating sharedsavings the goal. Adams estimates that t will take four years of intense ACO building to getthe needed data analytics and five years for predictive modeling. (Health DataManagement, April1, 2011)ACO Accreditation Standards Due In JulyTen healthcare organizations have finished a month long pilot to test the NationalCommittee for Quality Assurance (NCQA) accreditation program for accountable careorganizations (ACOs) and is the final step before issuing standards in July. (CMIO Aprils 22 TOC
  23. 23. 19, 2011)FTC And DOJ Call For ACO Comments Due By May 31On March 31, the U.S. Department of Health and Human Services issued rules for ACOs, tobe formed by hospitals, insurers and doctors. In a separate act, the U.S. Federal TradeCommission and the Justice Department will conduct antitrust reviews of proposals to formnetworks under the new health-care law, ending for now a discussions which agency willhave the responsibility. This now opens public comment on the two agencies jointlyproposed policy guidelines articulating how ACOs can serve Medicare beneficiariesand patients with private health insurance without raising competitive concerns.The policy statements include:  The types of ACOs to which it will apply,  How and when the FTC and DOJ will apply particular antitrust analyses to those ACOs,  Describe ACO antitrust safety zones,  Outline the CMS-mandated antitrust review process for certain other ACOs,  Procedures for ACOs to gain additional antitrust clarity if they fall outside the safety zone but below the CMS-mandated antitrust threshold.Comments are to be submitted electronically here by May 31, 2011. (Bloomberg, March 31,2011; HealthLeaders, April 1, 2011)Antitrust Surveillance Of Health Systems By DOJDepartment of Justice is increasing efforts to police hospitals and insurers it believes areillegally blocking fair competition. In the first case of its kind since 1999, the DOJ has suedUnited Regional Health System in Wichita Falls for allegedly encouraging healthinsurers not to do business with competing hospitals. That practice allowed UnitedRegional to keep its monopoly, according to the lawsuit, while it also became one of themost expensive hospitals in the state. The hospital disputes that its practice created amonopoly and became one of the more expensive hospital in Texas, but agreed to asettlement requiring it to change how it contracts with private insurers.At the same time these enforcement efforts are increasing, federal antitrust authoritieshave issued guidance that offers a more flexible response to providers that formaccountable care organizations - ACOs will initially make up only a tiny fraction ofthe health care market. The tactic that got the Texas hospital in trouble, willremain illegal for ACOs. Case detail are in the article. (Kaiser Health News, April 5,2011) 23 TOC
  24. 24. NEWLY RELEASED – HELPFUL ACO RESOURCESEasier 213 Page ACO Proposed Regulations - Issued by HHS as a 429page document, an easier to read and navigate product version is available in hard copyand MS Word format and was reduced to 213 pages.The Patient’s Role In ACOsFTC Proposed Antitrust Enforcement Policy StatementSpecial Edition – Expert Commentary On ACOs - SPECIAL EDITIONApril 2011:Expert Commentary on the CMS, FTC/DOJ, IRS and OIG ACORegulations/Guidance (Accountable Care News, April, 2011)The Commonwealth Fund & National Academy For HealthPolicy: State Roles In Promoting ACOs February 2011Accountable Care Organizations – American HospitalAssociation Research Synthesis Report. The AmericanHospital Association.Brooking-Dartmouth ACO ToolkitPWC Designing A Health It Backbone For ACOsEssential Population Management Tools For ACO - A 60-pageguidance for healthcare providers preparing for Medicares payment system change fromfee-for-service and episodic care to Accountable Care Organizations has been bothscattered and expensive to date.eHealth Initiative ReportsEvolution Of Care Delivery- Accountable Care OrganizationsAnd Preparing For ImplementationSEC/ 3022. Medicare Shared Savings ProgramAmerican Association Of Family Practice: The FamilyPhysician’s Blueprint For SuccessGeorge Washington University Hirsh Health Law And PolicyProgram Brief A good Implementation Brief providing an overview of the April 7thproposed rule, as well as the Proposed Statement of Antitrust Enforcement Policy and theinitial policies related to participation by nonprofit health care corporations and waiver offederal fraud and abuse laws. 24 TOC
  25. 25. MEDICAL HOME Patient Centered Medical Home practices continue to rack up savings and acceptance by the patient. Still, the need for strong I.T. infrastructure is called for to help specialty practices adapt.Patients Have Not Heard Of Medical Home (PCMH), But TheyLike The IdeasAccording to The Patient Poll, a survey of Pennsylvania adults conducted by the Institute forGood Medicine at the Pennsylvania Medical Society, the public isn’t exactly sure whata "patient centered medical home" is and that only 9.6% had heard of the term.However, respondent found the principal ideas of PCMH were appealing or veryappealing at high rates including:  91% stated that having their own team of health professionals,  90% like the idea of PCMH teams being led by physicians,  93% better communications and access via phone, email, and extended hours,  91% liked better attention to their future health needs  94% liked improved quality of my health(Pennsylvania Medical Society, April 24, 2011)Medical Home Model Save $333 Per Medicaid Patient In TheFirst Year.Savings of more than one million dollars in the first year of the Chemung County, NYMedicaid medical home that cares for 3,000 of their 19,000 Medicaid patients. Using acomputer program to monitor and find cost savings, savings of $150K were enjoyed byseeing patients in the clinic instead of the ER. Using this as a model, official estimatesare ranging up to $2 million. In this small county about 70% of property taxesgoes to pay for their share of Medicaid. With proven saving to date, 1000additional patients using the clinic is the goal for the end of the year. (wetmtv,April 19, 2011)Physician Office-Based Health Coaches Produce 400%Returns For Medical Home ModelPhysician Office-based Health coaches (POHCs) have play a key role in patient 25 TOC
  26. 26. engagement, cross-continuum care management, additional outreach, and other importantfunctions in the new model of care. Mercy Clinics has exceeded a 400% return oninvestment in its own health coaches by relieving physicians of clerical and nursingwork, increasing the number of office visits, allowing the clinics to bill higherlevels of service, increasing testing revenue, and supporting pay-for-performanceinitiatives.The Advisory Board Company--a research, consulting, talent development, and technologyservices firm partnering with over 2,900 of the worlds leading health care organizations--iscollaborating exclusively with Mercy Clinics to further develop and market an enhancedPOHC training program, as well as other medical home-related training programs. Since2008, over 100 health coaches have received POHC certification. (The Advisory Board,April 14, 2011)Medical Home Practice May Lower Use Of Diagnostic TestsRecently a pioneering oncology practice in Philadelphia received NCQA certificationas a medical home practice. Although the NCQA medical home program focuseson primary care, a few specialty practices have gained medical home recognitionand can be seen as a threat. Pathologists, clinical labs and other diagnostic servicesmay loose business in that other medical specialties may decide to be a medical homepractice and become more careful users of tests under standardize evidence-based medicalguidelines.(Dark Daily Clinical Lab News April 21, 2011)America Academy Of Pediatrics Calls For Robust IT ForMedical HomeA policy statement from the American Academy of Pediatrics Council on ClinicalIT in the Journal of Pediatrics emphasized that portable and comprehensiveelectronic health records are necessary to support a medical home model forchildrens primary care. The policy statement also listed some of the most important ITcapabilities for a pediatric medical home, including:  Data security,  Comprehensive records,  Maintaining secure and comprehensive patient records that includes a patients family health history, immunizations, medical care and prescriptions in an easily accessible database,  Monitoring treatment outcomes,  Educating and sharing information with patients and their families, and  Data aggregation and analysis for research and quality improvement.(iHealthbeat, April 28, 2011) 26 TOC
  27. 27. NEWLY RELEASED - HELPFUL MEDICAL HOME RESOURCESAAFP: Guidelines For Health Exchanges Include PCMHEndorsements - The American Association of Family Practice (AAFP) has created aset of eight principles designed to help member chapters address insurance exchangeissues with state legislators and regulators under the Patient Protection and Affordable CareAct. The document includes quality, eligibility and PCMH endorsements. (AAFP, April 27,2011)Community Health Accreditation Program - Created in 1965, andthrough “deeming authority” granted by the Centers for Medicare and Medicaid Services(CMS), CHAP has the regulatory authority to survey agencies providing home health,hospice, and home medical equipment services, to determine if they meet the MedicareConditions of Participation and CMS Quality Standards, it has more than 5,000 agenciescurrently accredited nationwide.Patient Centered Primary Care Collaborative: Medical Homeand Diabetes Care - "Practices in the Spotlight: The Medical Home and DiabetesCare" lays out the intersecting quality priorities of structured, high-value diabetes caremanagement and the principles of the medical home.National Academy For State Healthcare Polity - “State Multi-PayerMedical Home Initiatives and Medicare’s Advanced Primary Care Demonstration” - Briefingby the National Academy for State Health Policy. February 2010Grants From The Cautious Patient Foundation - This outreach andeducational arm of PatientAlwaysFirst, a nonprofit organization committed to educating andempowering patients, announced that over the next twelve months, CPF will grant out$100,000 ranging in size from $2,000 to $7,000 to support projects proposed by individuals,groups or nonprofit organizations. They have found that by providing individuals with theright tools and information to effectively interact with their own healthcare system, patientsbegin to experience better quality of care. (News Medical April 19, 2011) 27 TOC
  28. 28. PHYSICIAN & PROFESSIONALS Physicians are stepping up to the challenge of reducing healthcare costs.Brand Awareness and Strong SEO key to attractingPhysicians OnlineAccording to a March, 2011 comScore/ImpactRxPhysician Behavioral Measurement Solution study:  Most US physicians’ seeking online sources of health information in Q3 2010 were driven primarily by direct, non-referred access and natural search,  Paid search referred visits represented a relatively small percentage of physicians’ overall traffic to health-related sites  80% of online users look for healthcare information, ranks third behind email and search.comScore advises that this underscores the importance of building brandawareness and effective SEO strategies in order to reach physicians online.(MarketingCharts,.com April, 2011)Bain Survey Of Physicians – Physicians Actively Moving ToControl CostsA new survey of 500 US physicians from Bain & Company shows that physiciansbelieve that part of the burden of lowering healthcare costs rests directly ontheir shoulders.  80% of physicians agree or strongly agree that it is part their responsibility to bring healthcare costs under control,  35% of physicians say that compared to 5 to 10 years ago, they are less likely to try new products,  Physicians are also cutting costs by limiting the practice of defensive medicine, according to the report, 28 TOC
  29. 29.  Physicians are increasingly becoming more comfortable with standards of care, because they are a defensible position in case of litigation, and  33% of physicians anticipate being a part of an ACO or medical home in the next two years.As the reimbursement world moves away from a time when they were paid for activity to oneof delivering wellness, physicians are recognizing that a systemic change is under way.( April 20, 2011) 29 TOC
  30. 30. CONSUMER & CAREGIVER Although mixing social media and healthcare presents a promise for the distant future, caregivers have a strong appreciation for what I.T. can do for them - devices and communication technology will raise the quality of their lives and the patient’s.Social Media Not So Powerful for Online RetailAttention marketers - if you are rushing to increase your social media spend take note: Anew collaborative study between Forrester Research and GSI Commerce, analyzeddata captured from online retailers between November 12 and December 20,2010. The research shows that social media rarely leads directly to purchasesonline:  Less than 2% of orders were the result of shoppers coming from a social network. The report found email and search advertising were much more effective vehicles for turning browsers into buyers.  5% to 7% of purchases are influenced by social media outreach making it somewhat effective for distributing news about short-term deals.(, April, 2011)NOTE: In a March released study by Capstrat-Public Policy Polling survey, 85% said theywould not use social media or instant messaging channels for medicalcommunication if their doctors offered it. (Healthcare IT News, March 24, 2011)Consumers Think Social Media May Impact Their MedicalDecisionsAmericans think highly of the usability of social media but are tempered in crowning it thepremiere source of health care information when considering all options. 25% of respondents said social media was likely to impact future health care decisions. 32% said they had a high level of trust in social media sites. Only 7.5% said they had very low trust. 50% preferred heath provider websites to any other source. 14% preferred combining hospital websites and social media. Just 3% preferred only social media.Those with a household income of $75,000 or above were more likely than lesser 30 TOC
  31. 31. earners to look to social media sites for health information.O nline Social Networks Can Help People Make HealthierLifestyle ChoicesConsumers 50+ are the fastest growing segment on social media sites. Thisdemographic is increasingly seeking and sharing health info because of thecorrelation between age and chronic conditions. In addition to Facebook, Twitter andYouTube, online patient communities include: Lets patients share symptoms and treatments with each other. 80,000 members incl. 10,000 public profiles. Basis. Tracks biometric data via a Bluetooth watch. Allows parents to track and share their childrens immunization and medical history, plus growth chart and developmental milestones.Social pressure has been shown to help people make healthier lifestyle choices.C aregivers See Big Benefits From Information TechnologyThe National Alliance for Caregiving and United Healthcare survey found thatcaregiver’s anticipated benefits from the use of information technology included:  77% would save time,  76%making caregiving easier logistically,  75% make the patient feel safer, 74%increase feelings of being effective, and 74% stress reduction.Caregiver interest in specific applications include:  Personal Health Record - 77% would use to track health history, symptoms, medications, and test results, in a PHR,  Caregiving Coordination - 70% a master electronic calendar for scheduling of tasks and appointments for multiple care givers,  Medication Support - 70% would use medication reminders, alerts, dispensing and administration directions.  Patient Monitoring - 70% want to send data like blood sugar or blood pressure readings to a doctor or care manager,  Interactive Games - 62% want a TV-based devices to aid in fitness and mental conditioning,  Videophone - 61% want Telepresence to see who they are speaking with, and 31 TOC
  32. 32.  Smartphone - 69% thing smart phone apps could be helpful. 32 TOC
  33. 33. OVERSIGHT & INFLUENCE Oversight continues to tighten in the face of new health delivery models - this could be counter productive to modernization and drive cost up.Need For Home Care Requires Face To Face Consultations –Could Drive Costs Up“Only after the physician visits and has a face-to-face encounter with potentialpatients” – is the hallmark of new CMS regulations for physicians continuing theneed for home health care under Medicare. These regulations were delayed due toserious concerns about physicians readiness to comply and the impact that the requirementwill have on severely ill patients. Given that physicians are not compensated for travel timeto see homebound patients, theyre more likely to choose the easier and more costly route -keep patients in the hospital or refer them to another institutional care setting. (The Hill,April 4, 2011)IRS: Tax Exempt Hospital And ACOs BriefingThe Internal Revenue Service (IRS) indicated that it is considering how existingtax exemption applies to tax-exempt hospitals that will be participating in theMedicare Shared Savings Program (MSSP) through accountable care organizations(ACOs). The IRS recognizes that the promotion of health has long been recognized as acharitable purpose, but it then goes on to quote several authorities indicating that promotionof health alone does not ensure tax-exemption. (The National Law Review, April 27, 2011)If you’ve read this far then we have been successful in giving you somevalue. Please reciprocate and let me know your thoughts or if you don’tsee something that you would like to, then just drop a line to - –thank you.Jim BloedauManaging PartnerInformation Advantage Group 33 TOC