Huh (All Payer Claims Database Edition)

The MA commission reviewing provider pricing regulation came out with recommendations a few weeks ago.  The headline is that this is another step towards pricing regulation, but something else caught my eye.  One of their recommendations was to increase price transparency, and included this (emphasis mine),

Access to the All-Payer Claims Database. DHCFP is currently in the process of developing an All-Payer Claims Database (APCD), pursuant to M.G.L. c. 118G §6.  The Special Commission recommends that the state make the APCD accessible to consumers, purchasers, providers, insurers, and researchers both for standardized queries and in support of research to analyze price variation consistent with the provisions of the Data Release regulations, 114.5 CMR 22.00 et seq. Such disclosure should carefully guard protected health information (PHI), consistent with the Health Insurance Portability and Accountability Act (HIPAA). In addition, the Special Commission recommends including third-party administrators that process claims for self-insuring employers among the entities required to submit claims data to the APCD, consistent with the filing requirements for insurers serving fully-insured employers and individuals, to the extent it is legally feasible to do so.

Back in February I emailed the Office for Oregon Health Policy and Research to see if citizens would have any access to Oregon's all payer data.  The answer was no, due to privacy restrictions.  Maybe I'll forward them a copy of the MA report...

More on the concept that we need different doctors

Via Incidental Economist, more evidence that we'd be better off with different people going into med school.  Some folks did a study comparing graduates from Mount Sinai's non traditional HuMed program with those from the regular med school.  From the abstract:

Purpose: Students compete aggressively as they prepare for the MCAT and fulfill traditional premedical requirements that have uncertain educational value for medical and scientific careers and limit the scope of their liberal arts and biomedical education. This study assessed the medical school performance of humanities and social science majors who omitted organic chemistry, physics, and calculus, and did not take the MCAT.

...

Conclusions: Students without the traditional premedical preparation performed at a level equivalent to their premedical classmates.

 Not only was their performance statistically the same, but HuMed grads were more likely to go into cost effective primary care and less likely to do high cost surgical specialties.  That isn't a neutral result, it's a win.

Irvington Historic District: Buyers Remorse

I guess some people didn't know what they were signing up for when Irvington applied for Historic District status.  Take a look at the fees applicable.  "Minor Projects" like changing the house color or adding exterior lights now costs $1,050, just to pay the city to think about whether or not it will allow the homeowner to proceed.  I can understand why people would be upset, but how did they not know what they were signing up for?  It's not like the city just created the fee schedule, this is what Irvington residents elected to do to themselves. 

I can laugh now, but I'll be downright pissed if they get the fees reduced and I wind up having to subsidize their nonsense.

Paul Starr Op-Ed

The O linked to a Paul Starr Op-ed today.  A lot of it is a digest of Remedy and Reaction, but with some extra musing about the paring of Obama and Romney:

If former Massachusetts Gov. Mitt Romney and President Obama face off in the 2012 presidential campaign, America will witness the singular spectacle of two candidates getting very little love, and plenty of hate, for the same signature achievement: reforming health care.

Both overcame long odds to pass legislation, Romney in Massachusetts, Obama at the national level. Even the specifics of their reform laws are similar: Both include subsidies for private insurance, the establishment of insurance exchanges and a mandate for individuals to maintain a minimum level of coverage. Each man expected to reap credit for his effort. But neither has gotten political mileage out of it; in fact, both may have lost more ground than they picked up.

In another era, we might be celebrating the remarkable fact that both a Democratic president and a leading Republican challenger arrived at fundamentally the same approach to fixing our health-care system. That is not the America we live in now.

Worth reading.

If you wonder why enactment was delayed until 2014, Starr gave these reasons in R&R:

• Delaying enactment reduced the CBO cost, which covers the next 10 calendar years
• The decision to give states the responsibility for creating exchanges meant giving them time to enact legislation
• IRS said it would be confusing and chaotic tax-wise if programs incepted mid year or inconsistently across states

• Dems did not want enrollment occurring in Nov 2012 during election.  Medicare Part D blew up in someone's face in 2004(?).

 Starr implied that the real problem was Obama's failure to anticipate right wingers' willingness to turn on their own ideas in order to score political points.  That's what makes the prospect of a race between Obama and Romney so ironic.

Occupy vs voting

There are aspects of the Occupy movement I'm sympathetic to:  The initial focus on the actual Wall Street and the institutions that inhabited it was brilliant.  Just by being there, just by showing that citizens have as much right to Wall Street as Main Street they knocked it's mystique down a peg.  But then everyone decided to Occupy Wall Street, and many decided that New York was too far away and it was easier to occupy whatever was close at hand and would gain attention.  The movement when downhill from there...

That leads to today's post in the Oregonian. I'd read that protest camps tended to rely on caucuses and consensus rather then voting to make decisions, but I didn't know their contempt for voting ran so deep:

"We are demanding that we stop trying to solve problems in a "vote yes, vote no" format. We are making a statement that they cannot and will not be resolved simply by electing a different puppet into the same political structure..."

How do these people reconcile themselves with the history of struggle and sacrifice aimed at extending voting rights?  Do they think that was just a waste of time?  Gaining majority support is hard and uncertain, but without it there is no legitimacy.  Demagoguery is a poor substitute for democracy.

More Pushback from VT Providers

We've seen the "good cop" side of Vermont care providers' response to Single Payer, here comes the "bad cop."  The good doctor gives a litany of ways providers will react to the cost control regime, none of them good.  This kind of reaction is predictable and inevitable, it is why single payer advocates who focus solely on the evils of private insurance are not setting themselves up for success.  But two points are worth bearing in mind:

• The fact that doctors practicing under the current system are unwilling to practice under a system affordable to the public doesn't mean that reform is unworkable.  It just means that different doctors will be needed.  Med Schools starting at the application stage need to reconsider what it means for someone to be a good candidate to become a doctor.  Why does someone want to practice medicine?  Is it to help people, or to get automatic entry into the top 0.1% of the economy?  Such questions need to be given priority, especially when you consider how trivial admissions processes are (is it relevant in any meaningful sense whether someone got an "A" or a "B" in a weed-out OChem class?)
• Despite all the threats and complaints, the reality is that doctors in countries with single payer plans tend to be happier with their work then doctors now in the U.S. Again, see the point that maybe we need different people with different priorities and motivations practicing medicine.

Why the "industry" means more then insurers

When Oregon considered creating its Health Insurance Exchange, there were two key issues of dispute.

• Would the exchange be an "active purchaser", with the ability to exclude carriers even though they met federal qualifications?
• How many board members could be from the "health care industry," where that was broadly construed to mean insurers and providers.

 In discussions of the latter issue, it was routine to see questions about why doctors should be excluded or to simply construe "industry" as meaning insurers.  Implied was that providers were disinterested parties not at all concerned about money.  Here is a headline that puts such thinking in its place:

AMA opposes ‘active purchaser’ model for exchanges

H/T Incidental Economist

Irreconcilable Differences on the Right

From Kaiser, on why South Carolina isn’t trying to build an exchange:

[South Carolina’s Director of Health and Human Services] argues that the main function of the exchanges is to deliver the federal subsidies. That, according to Keck and other members of the subcommittee he chairs, "is solely a federal concern in which the state has no compelling interest."

From WSJ, claiming federal exchanges can’t offer subsidies:

ObamaCare authorizes premium assistance in state-run exchanges (Section 1311) but not federal ones (Section 1321). In other words, states that refuse to create an exchange can block much of ObamaCare's spending and practically force Congress to reopen the law for revisions.

Who’s lying?  Also notice the extortion angle in the WSJ piece- rewrite the health care law or Tea Party states will go to court to deny themselves exchange subsidies.  Wow, that will keep people up at night.

Ratemaking vs. Negotiating in Vermont

Doctors in Vermont have apparently picked up on the concept that they will be providing most of the savings under Single Payer.  Unsurprisingly, they're forming bargaining units to "inform the process."

Here is a philosophical question:  Does it make sense to pay doctor groups differentially based on how effectively they negotiate?  Should the Vermont Medical Society get paid more then HealthFirst because of the skill of their lobbyist?

That question points out a politically incorrect truth.  The process of establishing provider payments isn't really a negotiation at all, it is an exercise in rate setting by the state.  That rates will likely be influenced by "negotiators" does not contravene this, it will just indicate a clumsy and poorly thought out ratemaking process.

POW: Alex Steffen

LSE hosted Alex Steffen for a discussion of where the world in general and cities in particular are going.  I thought the most interesting take was the concept that what will save us is better data.  He talks about how everything from how we drive (mileage meters) to how we use power or water will eventually automatically record data and then give us information- how do we do compared to average?  How are we doing compared to yesterday or the year before?  To me it is a profound example of tech making what was once arbitrary and irrelevant into something specific and purposeful- changing how we use the gas and break pedal to be more efficient, connecting actions with consequences.

There is a downside though, in that the process of converting data into knowledge is not value free.  Someone has to determine what the average is and how it should be calculated, someone determines the scales on which we judge ourselves.  For example with utilities is the relevant average per household or per person?  For vehicles should they be judged by class (hatchbacks separate from SUV’s) or all together?  Those questions establish norms for society, but because of their “back room” nature it is unlikely people will be aware of them or the values embodied in their selection.  It’s analogous to what insurers do in developing classification plans, except that if people don’t like the way an insurer classifies them it’s easy enough to find a different insurer.  Not so with society…

Notes from Vermont

The Vermont Legislative Joint Fiscal Office released a report estimating the savings made possible by Single Payer. They estimate it will save between 0.8 and 3.5 billion between 2014 and 2019. To put those numbers in perspective, at the high end it would save more in six years on a per person basis then the much ballyhooed “super committee” is trying to cut in ten.

There’s also plenty of grist to back up my suspicions that people who advocate for Single Payer don’t really know what they’re talking about. The most common narrative advocating Single Payer runs along the line of “If we just get rid of the insurers, there will be tons of money and everyone will be happy.” Helpfully, Vermont breaks out their savings into some detail:

The low estimate shows about a third of savings coming from admin including both the payer (insurance) and provider (doctor) sides. More then half the savings come from clinical reform, which addresses how much doctors get paid, in what manner (capitation vs. fee for service), and improvements to public health and reduced utilization. The location of the "fat" is even more apparent in the high estimate:

So if Single Payer works the way people want it to, more then 75% of savings come from medical reform, not admin. And unsurprisingly, this is really hard. The paper discusses some of the issues confronted just to construct credible estimates. For example,

Each of these [payment reforms] has its own set of difficulties. For example, what is the right price to pay for a medical service? Is it the amount it costs to produce? Is it the amount at which an adequate provider supply is available? Is it the amount someone without insurance would be willing to pay for it (and who – Bill Gates or someone working at a minimum wage job)? Finally, is it the amount we as a society can afford to pay?

Implementing Single Payer involves all kinds of questions about what care should be delivered and what should be paid for it. In my view to answer those questions is to sell the program. How likely are people to buy into single payer if they don't know what they are getting? Instead advocates rely on a false narrative that reinforces a mythical conception of cost-free healthcare, one that ensures that even if the public does buy into single payer they will be unwilling to accept the compromises necessary for it to actually work.

Remedy and Reaction

I finished reading Paul Starr’s Remedy and Reaction.  This is an extraordinarily readable discussion of health insurance.  The book is worth getting for the first chapter alone, which summarizes reform efforts from the progressive era through Carter with enough detail to articulate why programs like Medicare succeeded versus the many others that failed. 

Starr then devotes chapter length treatments to the Clinton and Obama plans, describing why the Clinton plan ran off the rails and how Obama was determined to avoid the same fate.  I couldn’t help but walk away with much more respect for both men for their efforts.

Highly Recommended!