Posted in Accountable Care, ACO, Affordable Care Act, health reform

The Quality Payment Program

by Gregg A. Masters, MPH

In our healthcare innovation economy from the private sector to material modifications of public programs including Medicare and Medicaid there is a massive effort to identify and enable sustainable delivery and financing schema to stem the treasury bleeding and inch however incrementally towards ‘universal coverage’.CMS QPP 2

Ideological talking points opposing ‘Obamacare‘ aka the Affordable Care Act (ACA) notwithstanding, there are tangible efforts to move the needle in play while the uncertainty of a successor to the ACA remains largely ‘on the come’.

Continuing on this post ACA momentum, the Centers for Medicare and Medicaid recently weighed in on the ‘Quality Payment Program‘. Acting Administrator Andy Slavitt provides introductory remarks and is followed by his CMS colleagues who provide deeper dives into the QPPs two track choices: the Merit Based Incentive Payment System (MIPS) and Advanced Alternative Payment Models (APM).

To listen to the complete call we’re rebroadcasting it on ‘This Week in Health Innovation.‘ It is archived for on demand replay.

The associated deck is here, and the session transcript is here.

Original link to CMS QPP is here.

 

 

Posted in Accountable Care, Affordable Care Act, health reform

TrumpCare: What We ‘Know’?

by Gregg A. Masters, MPH

You’ve no doubt heard the expression: ‘a picture is worth a thousand words‘.

Well courtesy of Oliver Wyman Health we have an infographic that segments key provisions of ‘TrumpCare’s‘ impact on providers. For original graphic, click here, and timely commentary, see:Special Election Coverage: What Now? The Impact of a Trump Presidency‘ via Partner Sam Glick.
TrumpCare Impact on providers

Oliver Wyman breaks down the identifiable components of TrumpCare’s impact on providers as follows:

TrumpCare screen-shot-2016-11-15-at-10-06-48-am screen-shot-2016-11-15-at-10-07-00-am

 

So much ‘meat’ remains to be put on the bone. Assuming anything whether ‘substantiated’ by previous campaign rhetoric or more recent ‘indicia‘ of what will emerge post ‘repeal and replace‘ or now ‘amend’ intentions relative to the ACA (see: ‘As the TrumpCare Pivots Begins‘) is without a doubt ‘faith based‘ reliance on what remains essentially an aggregate ‘hologram‘ of President-Elect Trump’s health reform agenda.

Stay tuned!

 

Posted in Accountable Care, Affordable Care Act, health reform

As the TrumpCare Pivots Begins

by Gregg A. Masters, MPH

Just when we thought it was safe to get back in the ‘white water of health reform‘ with needed fixes to this arguably complex and ambitious Act, surprise!

Against all odds and the best and brightest minds in the polling community welcome President-Elect Donald Trump and his litany of public statements regarding the intent to ‘repeal and replace’ the Affordable Care Actday one‘.

There is so much to this story that it’s difficult to fix a single point of entry, so we’ve sourced just a few of his public statements to frame the discussion which we’ll launch here but dive further into at This Week in Health Innovation and PopHealth Week with my colleagues Fred Goldstein and Douglas Goldstein.

Last week the Wall Street Journal posted a piece which began what some now expect to be the inevitable revisionist walk-back on the range and depth of what is realistically possible for the categorical ‘repeal and replace‘ rhetoric of this ‘holographic‘ candidate, now President-Elect Trump. Trump has been rather clear that the ACA aka ‘Obamacare’ is a ‘disaster‘ and must be thrown out and replaced with some ‘beautiful‘, ‘bigly‘ or who knows what else occurs to him as a politically feasible replacement alternative?

Some of my colleagues in the health policy and health-wonk space who’ve inexplicably (in my view, though see: ‘Dear Mr. President-Elect, about that Ryan Plan Thing‘) hitched to the TrumpTrain and it’s Rorschach projection of what is to become ‘TrumpCare‘ have stunned me by proffering seemingly apologist precedent for his now revisionist tune:

Just to make sure you have the facts.. 🙂 He said in early primaries and consistently after that that preexisting and all that stays in.

This was in response to the following tweet given the WSJ piece:

screen-shot-2016-11-14-at-9-46-31-am

Yet here’s just a sampling of public statements made during his campaign:

trumpcare1

trumpcare7

trumpcare12 trumpcare10 trumpcare8 trumpcare7 trumpcare6 trumpcare5 trumpcare4 trumpcare3 trumpcare2

trumpcare8

This portion of Trump’s health reform agenda is so target rich and ‘on the come‘ while campaign rhetoric meets the real world of policy and politics, so we intend devote a fair amount of coverage and commentary to TrumpCare’s emerging policy indicia.

Meanwhile, here is the vision posited to the people and the Congress of the President Elect’s health reform (similar as ‘guidance‘ offered though materially at variance with Obama’s ‘8 Principles’) submitted to Congress as parameters for the debates and negotiations eventually leading to the passage of ACA:

TrumpCare

Some related references here:

http://www.sciencemag.org/news/2016/11/here-s-some-advice-you-president-trump-scientists

Medical science policy in the U.S. under Donald Trump

We do in fact live in interesting times!

 

 

Posted in Accountable Care, Affordable Care Act, health reform

The 2016 Medicare Trustees Report: One year closer to IPAB cuts?

by Gregg A. Masters, MPH

From the relentless drone of ‘where are the jobs, Mr. President?’ to the misguided fear mongering of ‘death panels for Grandma’ administered by un-elected, faceless bureaucrats to the de facto death of American Democracy itself the attacks on the Affordable Care Act (ACA), flawed indeed as it is, is starting to log results, some of them are quite impressive as noted by a recent piece at Morning Consult titled: ‘Trustees: Medicare Savings Recommendations Forestalled’.

View more details on Brookings.edu
View more details on Brookings.edu

This morning Brookings in association with the American Enterprise Institute and the Schaeffer Initiative for Innovation in Health Policy at the University of Southern California hosted ‘The 2016 Medicare Trustees Report: One year closer to IPAB cuts?‘.

The event is summarized by its organizers as:

For most of the last five decades, the most-discussed finding by the Medicare trustees has been the insolvency date, when Medicare’s trust fund would no longer be able to pay all of the program’s costs. Last year’s report projected that the hospital insurance trust fund would be depleted by 2030 – just 14 years from now. The report also predicted a more immediate and controversial event: the Independent Payment Advisory Board (IPAB), famously nicknamed “death panels,” would be required to submit proposals to reduce Medicare spending in 2018, with the reductions taking place in 2019. Do we remain on this path to automatic Medicare cuts next year?

The American Enterprise Institute and the Schaeffer Initiative for Innovation in Health Policy, a collaboration between the USC Leonard D. Schaeffer Center for Health Policy & Economics and the Brookings Institution, hosted a discussion of the new 2016 trustees report on June 23. Medicare’s Chief Actuary Paul Spitalnic summarized the key findings followed by a panel of experts who discussed the potential consequences of the report for policy actions that might be taken to improve the program’s fiscal condition. You can join the conversation at #MedicareReport.

In the tsunami of misrepresentation and outright deception of the many moving parts of the ACA the ultimate barometer of success – at least from the health policy perspective – is the forecasted effect the law was to have on the U.S. Treasury, i.e., it will bankrupt the country and undermine the roots of our pluralistic healthcare ecosystem, replacing it with a ‘top down’ Government run Federal quagmire.

EDITOR’s NOTE: for the Acting CMS Administrator’s take on the Federally Faciliated and State Run ‘Marketplace’, check out Andy Slavitt’s recap via ‘Marketplace Year 3: Issuer Insights and Innovation (Part 3).

Well the ACA results are in and the truth be told, while not a sealed trend (there are both headwinds and macroeconomic wildcards in the mix), the data is ‘encouraging‘.

Enjoy the audio!

 

Posted in Accountable Care, health reform, JP Morgan Healthcare Conference, Medicare

Must listen JP Morgan Healthcare Conference Webcasts: @MolinaHealth

by Gregg A. Masters, MPH

NOTE: This is the third in a series of ‘Must listen’ webcasts produced at JP Morgan’s 34th Annual Healthcare Conference. The first focused on telehealth sector market leader Teladoc, the second on Centene. For background and details on this august annual gathering, see ‘If It’s January, It’s JP Morgan Healthcare Conference. Remaining companies to detail as they represent important ‘bell weather’ insights relative to their respective sectors, include: Aetna, AthenaHealth, Genomic Health,Universal American, Tenet Health, as well as several from the ‘non-profit’ (tax exempt) sector including Baylor Scott and White

Molina Healthcare’s operations and strategy positioning insights are similar to Centene and in many ways constitute bell weather operators in the same space. Market and performance comparisons are material on a number of levels including the ‘urge to merge’ in the HMO or managed care space, and the implications such continuing consolidation holds for movement towards clinical and financial integration in the provider space. Additionally as many predict the future viability of the Medicare Trust Fund may rely largely on the efficacy of how Part C stakeholders articulate a sustainable vision of Medicare Advantage program to extend and enhance the life cycle of the Medicare program itself.

For direct link to the JP Morgan Healthcare Conference, click here. For the associated Molina Healthcare profile, click here, the deck here and webcast, here.

Meanwhile, below are some slides which outline the company’s performance and market sector overall:

JPM_MolinaHealthcareJPM_MolinaHealthcare_revenueJPM_MolinaHealthcare_membership

 

JPM_MolinaHealthcare_home_community
JPM_MolinaHealthcare_medicaid
JPM_MolinaHealthcare_medicaid_growth JPM_MolinaHealthcare_medicaid_spend

JPM_MolinaHealthcare_acquisition JPM_MolinaHealthcare_year_ahead

 

 

Posted in Accountable Care, Affordable Care Act, health reform

The @Aetna and @Humana Marriage: Will It Be Different This Time?

by Gregg A. Masters, MPH

Wow! Ahead of the 4th of July weekend Mark T. Bertolini (@mtbert) and Bruce D. Broussard (@BruceDBroussard) both savvy and seasoned managed health care industry players and visionary captains at @Aetna and @Humana respectively, announced their marriage via a $35 billion, see Bloomberg story: ‘Aetna-Humana Deal to Lower Consumer Costs, CEOs Say deal. aetna humanaYet the initial market reaction to this presumptive value added union has been somewhat of a Vulcan mind mood disappointment.

When the Bloomberg reporter Betty Liu inquired about the initial (and continuing as of the date of the post) bearish investor response to the transaction, Bertolini posited:

‘I don’t think its all investors Betty, I actually think it’s the ‘Arbs’ (arbitrageurs) that got in the deal looking for opportunity and I’m not quite sure they know how to do this trade.  This is a longer term strategy. This is a very big combination that is going to have a longer term impact on the quality of healthcare, the cost of healthcare in an evolving consumer marketplace [emphasis mine, more later].. once the noise settles down we’re going to do just fine.’

Then the billion, perhaps trillion dollar question was lobbed to Broussard via Liu:

‘Ok Bruce so is it going to lower healthcare costs for consumers?’ 

To wit the Humana chief noted:

‘very much so, I think as you see the transition from a more employer based to a consumer based model and a value based reimbursement model from a fee-for-service model, these combined organizations will have the capability to meet both of those trends. Both in the way of our clinical capabilities on the Humana side and the deep, deep employer relationships that Aetna has on their side.’

Now lets step back a minute and first breathe in this fact: no-where in evidence has the aggregate cost of healthcare, nor health insurance premiums as proxy, declined (except for a brief period in the 90s when the medical care cost (MCC) index actually fell temporarily into negative territory), then as risk was pushed back by providers to the health plans, resumed their inexorable movement UP. So on a trend basis, health care costs ALWAYS rise as a multiple of CPI. Only recently has that rate of growth fallen from high single or the double digit rate of increases witnessed historically to low single digits – perhaps due more to the economic meltdown (declining demand and higher deductibles/copays) than any proactive contribution via improved health plan clinical risk management, direct or delegated.

Yet in offering documents filed with the SEC and investors as to the rationale for the combined company merger that ‘benefit’ is always posited as an outcome of the transaction. We always hear about ‘scale’, ‘operating efficiencies’ and even better management as a byproduct of the combination.

Secondly, some ‘de-coding’ is in order here. Both Bertolini and Broussard two men I admire as exemplary disruptor’s of ‘legacy healthcare’ inertia, i.e., Bertolini grew up in the HMO industry back in the day when even though his experience was forged in the for profit side of the business, it was none-the-less a mission oriented member focused sector (more MHAs, MPAs, and MPHs than MBAs) much like the community based operators in the non profit sector (RIP).

Broussard on the other hand is not your typical health plan executive as his roots are forged on the provider side with senior roles as U.S. Oncology (the successor to Physician Reliance Corp and ‘TOPA’ Texas Oncology, P.A.), Sun Health (the hospital group) and Continental Medical Systems (a rehab company). So his zeitgeist is firmly rooted in the provider culture with which his company buys, contracts for or joint ventures with to bring products to market.

Now back to the ‘code phrases’ used as rationale outlined for the inked merger/acquisition. Bertolini referred to ‘an evolving consumer marketplace‘ which means as more costs are shifted from the plan (Aetna, Humana and all other health plans writ large) to the member or insured, we (the consumers) will demand more ‘accountability’ from the provider world and thus somehow restrain aggregate healthcare costs via transparency tools or so called ‘skin in the game’ as a result of the shift to ‘consumer directed’ (i.e., high deductible) health plans.

This strikes me as a somewhat disingenuous argument bordering on perhaps naiveté (though it is highly unlikely that this characterization can stick to either of them). But ask yourself, if Aetna, Humana, United, Anthem or the member licensees of the Blue Cross and Blue Shield Association as aggregate wholesale buyers of hospital and physician services, leveraging millions of members or ‘covered lives’ (insurance speak), backed by seasoned provider contracting staffs can’t restrain the cost of healthcare, how can an ‘app empowered’, health literate enabled retail ‘shopper’ (you and me) for health services do better? I don’t think so… There is just too much of a power differential to overcome not to mention eco-system complexity to navigate ‘digital empowerment’ promises notwithstanding. Whether, ’empowered or not’, we are generally ‘screwed’ with more or less support from our ‘friends’ at the health plan if we’re lucky enough to be insured.

The second but related theme was outlined by Broussard:

‘as you see the transition from a more employer based to a consumer based model and a value based reimbursement model from a fee-for-service model’

The two strands here are movement from the employer sponsored model which retains some vestiges of ‘defined benefits‘ at least for union negotiated plans, to a ‘consumer based model‘ more akin to the ‘defined contribution‘ practice of limiting the plan’s liabilities by capping what it pays for on behalf of its members or insureds. The kicker and perhaps ‘game changer‘ here is the near unanimous recognition in the health wonk, including health plan world that fee for services medicine is a burning platform on a dying paradigm – yet, arguably 80-90% of the money in the healthcare eco-system today remains in a predominant FFS book of business – HHS Secretary Burwell’s value based healthcare announcement notwithstanding) so don’t hold yer breath.

So there you have it. Will it, can it be different this time? Can two demonstrated champions of patient centric healthcare in an industry valued slightly higher than tobacco companies get it done when ALL of their predecessors have tried and failed? The carnage is plain to see, but only if you have an event horizon beyond the 24/7/365 current headline news cycle. I don’t know, but maybe the market knows and may even be paying attention to what came before?

For those who want some academic consideration of the broader strategic question, industry history,  if not possible glide-path in the consolidation orgy we are currently witnessing (both provider and health plan/payor/benefits solutions providers) with an exquisite dissection and analysis of the rise, fall and rise again (post Aetna/U.S. Healthcare acquisition), check out: ‘From Managed Care To Consumer Health Insurance: The Fall And Rise Of Aetna‘ by James Robinson, PhD, MPH the Leonard D. Schaeffer Professor of Health Economics and Director, Berkeley Center for Health Technology at my alma mater U.C. Berkeley.

Posted in Accountable Care, health reform, JP Morgan Healthcare Conference

Universal American: No Where to Be Found at JP Morgan Healthcare Conference 2015

By Gregg A. Masters, MPH

JP Morgan 22rd Annual Healthcare Conference

 

In preparing for my trip from San Diego to San Francisco to cover the 33rd Annual JP Morgan Healthcare Conference, see: ‘JPMorgan Healthcare Conference 2015: 33 Years Later We’re Still Searching…’ I’ve been speculating about the broader investment themes that many in the life sciences, biotech and pharma investment banking space may NOT be pondering given prevailing quarterly or year over year EPS event horizons.

In the post Affordable Care Act (ACA) era and with the ‘repeal and replace’ crowd chants notwithstanding the strategic imperative has not – and will never – change. The ‘all in’ from a total cost of care perspective pursuit of the ‘triple aim’ (better care, better outcomes, lower per capita costs) MUST be the ‘holy grail’ of any and all relevant investment themes valuing the quest for a sustainable public/private healthcare economy. Unfortunately too many niche market ‘exit calculations’ still seek to extract returns from a collapsing, volume incentivized – if not ‘burning platform’.

Whether the ACA is repealed or not (highly unlikely) its underlying value basis with a focus on population health and accountable care – including all of it’s derivative expressions (patient centered medical homes, patient empowerment via digital health technologies, pricing transparency plays, etc.) will remain the forward operating vision and quest of the day – if not decade.

In 2013 I focused on one publically traded company Universal American’s (UAM) ‘Healthy Collaboration’ ACO business model, see: ‘Universal American: A Healthy Collaboration’ and followed that post in 2014 with ‘Universal American: A Sign of Things to Come?’. As a reporting company their operating results would be useful to gage the progress towards ‘accountable care’ from a representative national and for-profit operator.

Before scanning the agenda for JPM15 presenting companies, I tweeted:

Gregg Masters @2healthguru
Curious if Universal American will report #ACOs or MA plans at #JPM15. 2013 session here: bit.ly/1g4CKZ5 pic.twitter.com/cs8eXMCdn4

Then upon determining they were not on the schedule this year I reported the ACO Revenue result sourced from their Q3 10Q 2014 filing:

Gregg Masters @2healthguru
RE: UAM ‘ACO Revenue’ #JPM15 pic.twitter.com/pgnd8QzQBb

UAM ACO Revenue 10Q Q3

To wit, Fred Goldstein (@fsgoldstein) the principal at Accountable Health LLC and Executive Director at the Population Health Alliance (PHA) ‘sarcastically noted:

Fred Goldstein @fsgoldstein RT @2healthguru: RE: UAM ‘ACO Revenue’ #JPM15 pic.twitter.com/VcnxmEF1mn …. Not bad 10% achieved shared savings he said sarcastically..#ACO

So, what does it mean if anything? We shall see if this is an artifact or non-appearance for perfectly reasonable causes, i.e. perhaps as banal as UAM no longer banks with JP Morgan, or maybe it’s a purposeful retrenchment by UAM leadership to not have to explain away their inability to perform on the ACO strategy.

Your thoughts?