Unbiased Analysis of Today's Healthcare Issues
AJMC reports that Humana has designed a new bundled payment model for maternity care. Initially, 5 practices will participate in a pilot study. While some claimed that bundled payment will improve quality and reduce cost (see “Bundle of Joy“), do we expect this to happen in practice? The key question is, what one means in…
That is the question that Carroll and co-authors try to answer in their latest NBER working paper (WP #23926). They examine the Arkansas Health Care Payment Improvement Initiative (APII), which is a state-wide, multi-payer episode-based program. Unlike most episode-based payment (EBP) models, provider participation in the program was mandatory (as of 2013). NBER summarizes the program…
The answer is maybe. Value-based insurance design ties patient cost sharing to the notion of a treatment’s value. Higher value treatments have lower cost sharing; lower value treatments have higher cost sharing. The Incidental Economist writes: In his own practice, Dr. Fendrick feels as if standard insurance is working against him and his patients. “They are deeply…
Value frameworks are all the rage of late. But are payers really using them? According to my colleague Jeremy Schafer, the answer is yes. From an article in Drug Topics: “Value assessment may become more important as the health-care market shifts to outcomes and value-based reimbursement models,” said Jeremy Schafer, PharmD, MBA, Senior Vice President…
Are high deductible health plans a good thing? Republicans typically argue yes as they say that increased cost sharing reduces moral hazard. That is, when people have to pay for medical care out of pocket, they don’t ask for unnecessary care or use care more frugally. Democrats typically argue that increased cost sharing reduces demand…
Maybe not. That is the answer from a study by Thompson et al. (2016). Using data from the Healthcare Cost and Utilization Project (HCUP) State Inpatient Databases (SID) for six states (AR, FL, IA, MA, NY,WA) from 2011 to 2013, the authors measure hospital performance reliability for the Hospital Readmission Reduction Program (HRRP). The define reliability as follows:…
In a typical insurance plan, patients have a fixed copayment, insurance and deductible regardless of whether the treatment they receive is considered high or low value. However, an alternative insurance structure–known as value-based insurance design (VBID)–uses a different approach. Under VBID, patient cost sharing is higher for low-value treatments and lower or eliminated for high-value…
There have been many pay-for-performance (P4P) programs that have been implemented to attempt to improve quality and reduce cost. The vast majority of these programs have not been able to demonstrate large or even any improvement in quality or cost. Some researchers claim that these programs have not worked due to the size of the…
Outcomes-based risk sharing agreements tie reimbursement for medical goods or services to patient outcomes. Despite the increasing demand from policymakers for value-based payment mechanism, risk-sharing agreements are not that comment. A paper by Garrison et al. (2015) found that there were only 148 risk sharing agreements (RSAs) worldwide between the late 1990s and 2013 and only 18 of the…
Bundled Payments for Care Improvement (BPCI)A helpful post from Steven A. Farmer, Meaghan George and Mark B. McClellan explains. Comprehensive Care for Joint Replacement (CCJR) is a bundled payment structure for hip and knee replacements. CMS notes that: 2013, there were more than 400,000 inpatient primary procedures in Medicare, costing more than $7 billion for hospitalization alone.…