Adding cost without adding value- baked into how we practice and the process measures we use

We recently went through a Joint Commission visit in one health system and mock visits in two other systems. The preparations leading up to these visits are remarkably resource intensive and without question divert resources from other activities which may be more valuable for patient care. We had one particular demand which was both silly and crazy at the same time. For reasons of privacy, we were instructed by our internal reviewer to turn all of our exam chairs such that a patient sitting in the chair could not be identified from the door. No matter that we have installed curtains which are pulled and block the view from an open door. No matter that the rooms were configured where the desk where the provider sits and documents when they are interviewing the patient will now afford the MD/PA a view of the back of the chair. No matter, our work and our opinions are beside the point.

If it were only that the Joint Commission were a bad actor but alas that is not the case. The practice of medicine is riddled with expensive and arbitrary practices which someone thinks might be a good idea and are implemented with limited if any evidence that they actually add value to patients lives. The value that might be added may be dwarfed by the actual cost of delivery.  However, it appears that no additional cost is ever viewed as excessive if it is borne by some other party and/or if the cost can be made sufficiently opaque. I spend my time taking training courses to maintain credentials, courses which impart questionable knowledge and assessed via tests which measure nothing of value pertaining to trivia which is quickly forgotten. On a regular basis, we participate in credentialing processes which remind me of the movie Men in Black. It appears that those involved have had their memories wiped on a regular basis forcing us to repeat steps which have been done over and over again over the course of literally decades.

Within the actual practice, we seem to be blind to the concept of diminishing returns. Any anecdote, no matter how rare or exceptional, can serve as a justification for some intervention which is pushed to be universally applied. The authority to hold people and systems to comply with such mandates tends to be delegated to regulatory entities which become interested primarily in perpetuation of their own existence and use their ability to publicly shame and operationally cripple health care delivery systems to force people and systems to kowtow to their demands, no matter how little value they add to patient care and how much cost is layered on.

There is little incentive to take on such regulatory entities. When you are under scrutiny, you would be crazy to challenge their authority. They hold all of the cards and while they may use such words as "partnership", don't be fooled. When you have finished the review process and met all of the demands, no matter how obscure, irrelevant, or trivial, the incentives drive you and your organization to get back to the work or your core missions. There is no clear pathway to hold the regulatory entities accountable and any effort to shine a light on the absurdity and arbitrariness of their work and rules will almost certainly come back to haunt your organization at the next review cycle.

This again brings to mind the quote from the movie "Bananas" -

Esposito: From this day on, the official language of San Marcos will be Swedish. Silence! In addition to that, all citizens will be required to change their underwear every half-hour. Underwear will be worn on the outside so we can check.

Who should drive cost control efforts in health care?

Ever since I was in medical school almost 40 years ago, we have been talking about the growth of health care expenditures and how the growth rate is unsustainable. Like the proverbial frog in the heated pot, we have adjusted to increasing costs as we approach the boiling point. I believe we are approaching the boiling imminently and payers at all levels are trying to figure out how they can remain solvent while at the same time finance needed health care spending. 

The WSJ published a piece in late March of 2018 highlighting that two major issues are creating financial challenges for state budget, pensions and health care, particularly Medicaid. (WSJ). The result is crowding out of expenditures on virtually all other state functions. The effects of growth in spending diffuse across all levels of payer, public and private. Private insurers are engaged in pitched battles with large and increasingly consolidated health systems over rates while at the same time trying to move costs back to consumers, increasing deductibles and co-pays. It is getting very ugly. We recently experienced a showdown between Piedmont Healthcare and Blue Cross within the Atlanta market which required the Governor to weigh in to get the parties back to the negotiating table.  

At the same time, CMMS is searching for innovative approaches to effectively deliver health care to its covered populations at lower costs (or at least at slower growth rates). They announced a requests for comments and information on 4/23/18 (CMMS RFI). The RFI throws out a host of ideas, driven by the theme of market based approaches. It is not especially cohesive or cogent. That is not surprising since no one knows the magic formula by which were can consistently do a good job at substantially lower costs. The request is just that: for input from interested parties who can assist them in their goals. 

The responses from the physician community are fairly predictable.  We do not want to act like insurers. We never have and it places us in a very conflicted position. It is essentially impossible to act as advocates for our patients while at the same time function as stewards of system resources. That job is unpalatable and is extremely difficult (perhaps impossible) to do. The AMA has weighed in on this (AMA cost control) and from what I can tell, they take the same tack as politicians who say they will balance budgets by eliminating fraud and abuse without recognizing the underlying structural faults. The amounts saved via the former interventions are rounding errors. The real work requires very fundamental changes in how programs are structured. To take that on means taking on vested interests directly. Professional organizations like the AMA are ill equipped to take these types on jobs on. They function as guilds and are driven by member concerns. 

The Physician community does not want to do the difficult and unpalatable work of driving cost control, acting like insurers, limiting care, and explicitly pushing costs on to patients.  However, we do not want to delegate that job to any other party. We want to be in control. It boils down to whether we as physicians want to lead and exert some degree of control over whatever processes are put in place to try to control costs or whether we present the face of resistance. It is clear to me that CMMS has no real clue as to drive cost savings but I do not think we are particularly constructive in our criticism. We are basically washing our hands of the problem for the simple reason that any solutions we can come up with will either result in transfer of costs to patients (which we believe will result in them balking at payment), decrease in the amount of care activity we are engaged with (with decreased revenue), or decrease the payment per unit of work.  We don't like any of these for obvious reasons but in my opinion, we still should come to terms with whether bending the cost curve is something which is desirable or really essential. If it is, then if not us to deal with it, who then should be empowered to address it? 

Price fixing is not OK when you want to do it but is OK when I want to do it.

The NYT reports a story this morning on attempts of the state of Massachusetts to rein in the growth of spending on prescription drugs. Nothing new or surprising here. Medicaid costs are growing and projections across the board for all states are that if nothing different is done , Medicaid costs will crowd out all other state spending over the next 10-20 years.

The Massachusetts experiment is contingent upon getting a Medicaid waiver from the Feds. Seems reasonable given the basic premise of the waiver concept. Try things in a limited space and if they work, they can be adopted elsewhere. What is difficult to understand is the push back and particularly where the push back is coming from. The AMA, ACP, and the ACS, as well as a number of big pharmaceutical firms (J&J, Merck, Lilly, Teva, and Pfizer)  are pushing back against this proposal.

I get the drug companies resistance. They desire the largest degrees of freedom to push their pricing power. They may say they are motivated by getting the best drugs to patients and that may be true to some extent. We should not be so naive to believe that is their primary motivation. However, the MD professional societies are another matter, especially the AMA. Here you have an organization that is behind the largest price fixing apparatus in a segment of the economy that constitutes nearly 20% of GDP.

The mantra is that such efforts will limit patient access to life saving therapies. However, the ongoing price fixing actions of the AMA have limited patient access to life saving expertise for more than 25 years. We still allow for pharmaceuticals to be priced at various tiers based upon a host of factors but according to the AMA, all expertise is generic and linked to common billing codes which do not account for quality or unique expertise. That is entirely acceptable even though it has devastating effects on access to expertise, especially diagnostic expertise or chronic care management.

In digging deeper into the AMA position, I found this news story from Axios last October. It almost defies comprehension. (Axios Link)

Context: McAneny, an oncologist, made her comments in Chicago at a meeting of the AMA's Relative Value Scale Update Committee, an influential panel known as the RUC. A crowd member asked her if the AMA was "missing an opportunity to throw the weight of our collective influence" behind asking the federal government to negotiate drug prices, which Medicare cannot do by law.  The AMA has been outspoken about rising drug prices and the factors behind them. "There's a lot of places where we can look at significant amounts of waste," McAneny said after calling out pharmacy benefit managers, insurance companies and specialty pharmacies.

However, official AMA policy currently "opposes the use of price controls in any segment of the health care industry, and continues to promote market-based strategies to achieve access to and affordability of health care goods and services." Instead, it backs transparency measures like requiring drug companies to post prices in ads.

Looking ahead: The RUC's main business of examining new payment rates for physician services starts Thursday. Medicare has said it would adopt nearly all of the RUC's recommendations for the upcoming year.

Here we had the AMA President railing against price fixing at the meeting of the AMA RUC, their own price fixing entity.