Friday, March 6, 2015
March 4, 2015
Innovating Care for Medicare Beneficiaries: Time for Riskier Bets and
By Ashish K. Jha
Of all the pressing challenges in the US health care system, lack of
innovation in delivery may be the most important.
This lack of innovation in how we do things is a major reason why health
care productivity has been so low and high spending has had insufficient
benefits for patients.
A major premise of the Affordable Care Act (ACA) was that it would spur
new models of care delivery. The architects of the ACA understood that
old models of care delivery impeded gains in productivity, made it
difficult to improve patient outcomes, and made the health care delivery
system inefficient. In response, the ACA established the Center for
Medicare and Medicaid Innovation (CMMI), which is responsible for
changing how we deliver health care. The ACA provides CMMI with $1
billion per year for 10 years, much larger than the budgets of the
Agency for Healthcare Research and Quality and the Patient-Centered
Outcomes Research Institute, 2 entities that have gotten far more
attention. Will CMMI achieve the meaningful new models of care delivery
that our health care system needs? It is unclear, but there is reason
A Mixed Picture
Four and a half years after launch, CMMI appears to have funded 36 new
programs, of which we have evaluations for 9. Nearly all the evaluations
are positive, although careful examination of the reports paints a far
more mixed picture. Most programs are having minimal effects, on the
For example, the Comprehensive Primary Care Initiative, across 6 states,
seems to have a monthly savings of $14 dollars (2% of total Parts A and
B spending) per patient, compared with controls, a savings that actually
turns negative when the costs of the program are included. The effects
on quality are minimal, as well.
Betting on Nontraditional Players
Foremost, CMMI needs to make meaningful bets on nontraditional
players—such as startups and small delivery organizations—that are
trying to fundamentally upend health care delivery. Next, focusing on
organizations that are using technology in radically different ways,
employing nontraditional personnel to facilitate care, and targeting new
locations for care delivery would also be helpful. Focusing on
nonincumbents and taking risks with nontraditional care models would pay
much bigger dividends than the marginal savings that current programs
are likely to generate.
But they would come at a cost: a high failure rate. Advocates of the
current CMMI approach would argue that such failures are unpalatable,
given the current political environment. Although that is surely true,
the broader health care community must give CMMI the space to fail. Even
the talented, highly capable people running CMMI can't have success
rates much higher than those seen in Silicon Valley, where comparably
smart investors are using their own money to make bets. But, if they are
willing to be risky—and willing to fail—they can have a profound effect
on the way health care is delivered. And that will be an investment
The New England Journal of Medicine
March 4, 2015
Market-Based Solutions to Antitrust Threats — The Rejection of the
By Regina E. Herzlinger, D.B.A., Barak D. Richman, J.D., Ph.D., and
Kevin A. Schulman, M.D.
Health care consumers won a significant victory when Massachusetts
Suffolk County Superior Court Judge Janet Sanders blocked a settlement
that would have allowed Partners HealthCare, the system that dominates
the Boston area, to acquire three additional health care providers in
eastern Massachusetts. Sanders concluded that the acquisitions "would
cement Partners' already strong position in the health care market and
give it the ability, because of this market muscle, to exact higher
prices from insurers for the services its providers render."
If this decision is not overturned on appeal, consumers will now be
spared those projected price increases. But there is an even bigger
reason for New Englanders to celebrate the judge's ruling. The danger
lay not only in Partners' expanded dominance but also in the degree to
which the settlement would have shut out other innovative competitors.
Health care delivery does not rely on fixed assets whose returns should
be guaranteed. Rather, it relies on services and interactions between
caring clinicians and patients in need. This concept is lost when public
policy focuses on regulating returns on invested capital rather than on
promoting the provision of high-quality, innovative, efficient clinical
services. Innovative, low-cost competitors to most hospital services
could abound — for example, telemedicine providers and community-based
urgent care centers. Such innovations may represent the public's best
hope for sustainable health care. But the proposed settlement could have
squashed opportunities for innovation, since it conceded Partners'
dominance and tried only to contain it.
We need policies that challenge expansions and preserve competition, not
those that assist the dominant player. We have our own list: encouraging
payment reform that rewards quality and cost-effectiveness; liberalizing
scope-of-practice regulations, licensing rules, and other prohibitions
to allow more efficient use of human resources; ensuring that
professional regulations, state boundaries, and FDA rules do not impede
telemedicine and digital products that enable mobile health management;
and refining antikickback rules and reimbursement restrictions to enable
providers to pursue creative, integrated ventures that could
revolutionize the delivery of care. And there is much that attorneys
general can do to promote such innovation-oriented policies.
Instead of focusing solely on regulating dominant hospital systems,
policymakers should also pursue strategies that can foster real
competition and innovation in the price, accessibility, and quality of care.
Comment by Don McCanne
Where would this world be without the sage advice of some of the great
thinkers of the past and present?
"Don't just stand there. Do something!"
"Don't accept the status quo. Innovate!"
"Don't regulate. Allow markets freedom to compete!"
Thank goodness that these have been our guiding principles in health
care for the past century so that now we have the highest quality health
care system and the lowest costs, that is except for all of the other
nations that have placed a priority on public policies over private
We still haven't learned. We are spending billions of taxpayer dollars
on just doing something… anything. The CMMI innovations that we have
funded have had, at best, only minimal benefits at the margin. In fact,
the savings have turned negative when the costs of the programs are
included. Worse, the effects on quality have been negligible as well. In
these efforts, we're spending more and buying nothing.
Yet we continue to allow the clarion call for innovation and competition
to drown out the message of reform that would finally include absolutely
all of us in a high-performance health care delivery system that finally
would be truly affordable. Of course, that reform would be a single
payer national health program. Our immediate task is to make our clarion
call drown out theirs. As it is now, our is hardly a peep. (Think not?
Google innovation in health care - 377 million results - and single
payer health care - 2 million results.)
at 4:06 PM