Early Impact Of CareFirst's Patient-Centered Medical Home With Strong Financial Incentives.

In 2011 CareFirst BlueCross BlueShield, a large mid-Atlantic health insurance plan, implemented a payment and delivery system reform program. The model, called the Total Care and Cost Improvement Program, includes enhanced payments for primary care, significant financial incentives for primary care physicians to control spending, and care coordination tools to support progress toward the goal of higher-quality and lower-cost patient care. We conducted a mixed-methods evaluation of the initiative's first three years. Our quantitative analyses used spending and utilization data for 2010-13 to compare enrollees who received care from participating physician groups to similar enrollees cared for by nonparticipating groups. Savings were small and fully shared with providers, which suggests no significant effect on total spending (including bonuses). Our qualitative analysis suggested that early in the program, many physicians were not fully engaged with the initiative and did not make full use of its tools. These findings imply that this and similar payment reforms may require greater time to realize significant savings than many stakeholders had expected. Patience may be necessary if payer-led reform is going to lead to system transformation.

The Impact of Green House Adoption on Medicare Spending and Utilization.

OBJECTIVE: To evaluate the impact of the Green House (GH) model of nursing home care on Medicare acute hospital, other hospital, skilled nursing facility, and hospice spending and utilization. DATA SOURCES/STUDY SETTING: Medicare claims and enrollment data from 2005 through 2010 merged with resident-level minimum data set (MDS) assessments. STUDY DESIGN: Using a difference-in-differences framework, we compared Medicare Part A and hospice expenditures and utilization in 15 nursing homes that adopted the GH model relative to changes over the same time period in 223 matched nonadopting nursing homes. We applied the same method for residents of GH homes and for residents of "legacy" homes, the original nursing homes that stay open alongside the GH home(s). PRINCIPAL FINDINGS: The adoption of GH had no detectable impact on Medicare Part A (plus hospice) spending and utilization across all residents living in the nursing home. When we analyzed residents living in GH homes and legacy units separately, however, we found that the adoption of the GH model reduced overall annual Medicare Part A spending by $7,746 per resident, although this appeared to be partially offset by an increase in spending in legacy homes. CONCLUSIONS: To the extent that the GH model reduces Medicare spending, adopting nursing homes do not receive any of the related Medicare savings under traditional payment mechanisms. New approaches that are currently being developed and piloted, which better align financial incentives for providers and payers, could incentivize greater adoption of the GH model.

Green House Adoption and Nursing Home Quality.

OBJECTIVE: To evaluate the impact of the Green House (GH) model on nursing home resident-level quality of care measures. DATA SOURCES/STUDY SETTING: Resident-level minimum data set (MDS) assessments merged with Medicare inpatient claims for the period 2005 through 2010. STUDY DESIGN: Using a difference-in-differences framework, we compared changes in care quality and outcomes in 15 nursing homes that adopted the GH model relative to changes over the same time period in 223 matched nursing homes that had not adopted the GH model. PRINCIPAL FINDINGS: For individuals residing in GH homes, adoption of the model lowered readmissions and several MDS measures of poor quality, including bedfast residents, catheter use, and pressure ulcers, but these results were not present across the entire GH organization, suggesting possible offsetting effects for residents of non-GH "legacy" units within the GH organization. CONCLUSIONS: GH adoption led to improvement in rehospitalizations and certain nursing home quality measures for individuals residing in a GH home. The absence of evidence of a decline in other clinical quality measures in GH nursing homes should reassure anyone concerned that GH might have sacrificed clinical quality for improved quality of life.

Dominated choices and Medicare Advantage enrollment.

Research in behavioral economics suggests that certain circumstances, such as large numbers of complex options or revisiting prior choices, can lead to decision errors. This paper explores the enrollment decisions of Medicare beneficiaries in the Medicare Advantage (MA) program. During the time period we study (2007-2010), private fee-for-service (PFFS) plans offered enhanced benefits beyond those of traditional Medicare (TM) without any restrictions on physician networks, making TM a dominated choice relative to PFFS. Yet more than three quarters of Medicare beneficiaries remained in TM during our study period. We analyze the role of status quo bias in explaining this pattern of enrollment. Our results suggest that status quo bias plays an important role; the rate of MA enrollment was significantly higher among new Medicare beneficiaries than among incumbents. These results illustrate the importance of the choice environment that is in place when enrollees first enter the Medicare program.

The impact of global budgets on pharmaceutical spending and utilization: early experience from the alternative quality contract.

In 2009, Blue Cross Blue Shield of Massachusetts implemented a global budget-based payment system, the Alternative Quality Contract (AQC), in which provider groups assumed accountability for spending. We investigate the impact of global budgets on the utilization of prescription drugs and related expenditures. Our analyses indicate no statistically significant evidence that the AQC reduced the use of drugs. Although the impact may change over time, early evidence suggests that it is premature to conclude that global budget systems may reduce access to medications.

Culture change and nursing home quality of care.

PURPOSE OF THE STUDY: Culture change models are intended to improve the quality of life for nursing home residents, but the impact of these models on quality of care is unknown. We evaluated the impact of the implementation of nursing home culture change on the quality of care, as measured by staffing, health-related survey deficiencies, and Minimum Data Set (MDS) quality indicators. DESIGN AND METHODS: From the Pioneer Network, we have data on whether facilities were identified by experts as "culture change" providers in 2004 and 2009. Using administrative data, we employed a panel-based regression approach in which we compared pre-post quality outcomes in facilities adopting culture change between 2004 and 2009 against pre-post quality outcomes for a propensity score-matched comparison group of nonadopters. RESULTS: Nursing homes that were identified as culture change adopters exhibited a 14.6% decrease in health-related survey deficiency citations relative to comparable nonadopting homes, while experiencing no significant change in nurse staffing or various MDS quality indicators. IMPLICATIONS: This research represents the first large-scale longitudinal evaluation of the association of culture change and nursing home quality of care. Based on the survey deficiency results, nursing homes that were identified as culture change adopters were associated with better care although the surveyors were not blind to the nursing home's culture change efforts. This finding suggests culture change may have the potential to improve MDS-based quality outcomes, but this has not yet been observed.

A Bayesian Procedure for File Linking to Analyze End-of-Life Medical Costs.

End-of-life medical expenses are a significant proportion of all health care expenditures. These costs were studied using costs of services from Medicare claims and cause of death (CoD) from death certificates. In the absence of a unique identifier linking the two datasets, common variables identified unique matches for only 33% of deaths. The remaining cases formed cells with multiple cases (32% in cells with an equal number of cases from each file and 35% in cells with an unequal number). We sampled from the joint posterior distribution of model parameters and the permutations that link cases from the two files within each cell. The linking models included the regression of location of death on CoD and other parameters, and the regression of cost measures with a monotone missing data pattern on CoD and other demographic characteristics. Permutations were sampled by enumerating the exact distribution for small cells and by the Metropolis algorithm for large cells. Sparse matrix data structures enabled efficient calculations despite the large dataset (≈1.7 million cases). The procedure generates m datasets in which the matches between the two files are imputed. The m datasets can be analyzed independently and results combined using Rubin's multiple imputation rules. Our approach can be applied in other file linking applications.

Enrollment in Medicare Advantage plans in Miami-Dade County: evidence of status quo bias?

Evidence from behavioral economics reveals that decision-making in health care settings can be affected by circumstances and choice architecture. This paper conducts an analysis of choice of private Medicare plans (Medicare Advantage plans) in Miami-Dade County. We provide a detailed description of the choice of MA plans available in Miami over much of the program's history. Our analysis suggests that first becoming eligible for Medicare is the key transition point for MA, and that there is significant status quo bias in the MA market. Policy that regulates the MA market should anticipate, monitor and account for this consumer behavior.

The impact of the Affordable Care Act on Medicare Advantage plan availability and enrollment.

OBJECTIVE: To assess the impact of the Patient Protection and Affordable Care Act's (ACA) changes in Medicare Advantage (MA) payment rates on the availability of and enrollment in MA plans. DATA SOURCES: Secondary data on MA plan offerings, contract offerings, and enrollment by state and county, in 2010-2011. STUDY DESIGN: We estimated regression models of the change in the number of plans, the number of contracts, and enrollment as a function of quartiles of FFS spending and pre-ACA MA payment generosity. Counties in the lowest quartile of spending are treated most generously by the ACA. PRINCIPAL FINDINGS: Relative to counties in the highest quartile of spending, the number of plans in counties in the first, second, and third quartiles rose by 12 percent, 7.6 percent, and 5.4 percent, respectively. Counties with more generous MA payment rates before the ACA lost significantly more plans. We did not find a similar impact on the change in contracts or enrollment. CONCLUSIONS: The ACA-induced MA payment changes reduced the number of plan choices available for Medicare beneficiaries, but they have yet affected enrollment patterns.

State-level impacts of Medicare Part D.

In recent research, we explored the impact of the Medicare Part D program on hospitalization rates for ambulatory care-sensitive conditions (ACSCs) among elderly Americans.1 Our results indicate that Part D reduced a summary measure of ACSC hospitalization by 20.5 per 10,000, a percentage change of 4.1 percent. This change represents approximately 42,000 admissions, roughly half of the overall reduction in admissions in our 23-state sample during our study period (2005-2007). In this brief, we explore the state-level implications of the findings from our paper, by estimating the number of avoided hospitalizations in each state.

Complex Medicare advantage choices may overwhelm seniors--especially those with impaired decision making.

The proliferation of Medicare Advantage plans has given Medicare enrollees more choices, but these could be overwhelming for some, especially for those with impaired decision-making capabilities. We analyzed national survey data and linked Medicare enrollment data for the period 2004-07 to examine the effects on enrollment of expanded choices and benefits in the Medicare Advantage program. The availability of more plan options was associated with increased enrollment in Medicare Advantage when elderly Medicare beneficiaries chose from a limited number of plans-for example, fewer than fifteen plans. Enrollment was unchanged or decreased in Medicare Advantage when beneficiaries chose from larger numbers of plans-for example, fifteen to thirty, or more than thirty. Elderly adults with low cognitive function were less responsive to the generosity of available benefits than those with high cognitive function when choosing between traditional Medicare and Medicare Advantage. Simplifying choices in Medicare Advantage could improve beneficiaries' enrollment decisions, strengthen value-based competition among plans, and extend the benefits of choice to seniors with impaired cognition. It could also lower their out-of-pocket costs.

Vertical integration and optimal reimbursement policy.

Health care providers may vertically integrate not only to facilitate coordination of care, but also for strategic reasons that may not be in patients' best interests. Optimal Medicare reimbursement policy depends upon the extent to which each of these explanations is correct. To investigate, we compare the consequences of the 1997 adoption of prospective payment for skilled nursing facilities (SNF PPS) in geographic areas with high versus low levels of hospital/SNF integration. We find that SNF PPS decreased spending more in high integration areas, with no measurable consequences for patient health outcomes. Our findings suggest that integrated providers should face higher-powered reimbursement incentives, i.e., less cost-sharing. More generally, we conclude that purchasers of health services (and other services subject to agency problems) should consider the organizational form of their suppliers when choosing a reimbursement mechanism.

Medicare prospective payment and the volume and intensity of skilled nursing facility services.

In 1998, Medicare adopted a per diem Prospective Payment System (PPS) for skilled nursing facility care, which was intended to deter the use of high-cost rehabilitative services. The average per diem decreased under the PPS, but because per diems increased for greater therapy minutes, the ability of the PPS to deter the use of high-intensity services was questionable. In this study, we assess how the PPS affected the volume and intensity of Medicare services. By volume we mean the product of the number of Medicare residents in a facility and the average length-of-stay, by intensity we mean the time per week devoted to rehabilitation therapy. Our results indicate that the number of Medicare residents decreased under PPS, but rehabilitative services and therapy minutes increased while length-of-stay remained relatively constant. Not surprisingly, when subsequent Medicare policy changes increased payment rates, Medicare volume far surpassed the levels seen in the pre-PPS period.

The impact of Medicare Part D on hospitalization rates.

OBJECTIVE: To determine whether the change in prescription drug insurance coverage associated with Medicare Part D reduced hospitalization rates for conditions sensitive to drug adherence. DATA SOURCES/STUDY SETTING: Hospital discharge data from 2005 to 2007 for 23 states, linked with state-level data on drug coverage. STUDY DESIGN: We use a difference-in-difference-in-differences approach, comparing changes in the probability of hospitalization before and after the introduction of the Part D benefit in 2006, for individuals aged 65 and older (versus individuals aged 60-64) in states with low drug coverage in 2005 (versus those in states with high pre-Part D drug coverage). DATA COLLECTION/EXTRACTION METHODS: Hospitalization rates for selected ambulatory care sensitive conditions in 23 states were computed using data from the Census and Health Care Utilization Project. Drug coverage rates were computed using data from several sources. PRINCIPAL FINDINGS: For the conditions studied, our point estimates suggest that Part D reduced the overall rate of hospitalization by 20.5 per 10,000 (4.1 percent), representing approximately 42,000 admissions, about half of the reduction in admissions over our study period. Conclusions. The increase in drug coverage associated with Medicare Part D had positive effects on the health of elderly Americans, which reduced use of nondrug health care resources.

Outcomes for single-level lumbar fusion: the role of bone morphogenetic protein.

STUDY DESIGN: Retrospective analysis of a population-based insurance claims data set. OBJECTIVE: To determine the risk of repeat fusion and total costs associated with bone morphogenetic protein (BMP) use in single-level lumbar fusion for degenerative spinal disease. SUMMARY OF BACKGROUND DATA: The use of BMP has been proposed to reduce overall costs of spinal fusion through prevention of repeat fusion procedures. Although radiographic fusion rates associated with BMP use have been examined in clinical trials, few data exist regarding outcomes associated with BMP use in the general population. METHODS: Using the MarketScan claims data set, 15,862 patients that underwent single-level lumbar fusion from 2003 to 2007 for degenerative disease were identified. Propensity scores were used to match 2372 patients who underwent fusion with BMP to patients who underwent fusion without BMP. Logistic regression models, Kaplan-Meier estimates, and Cox proportional hazards models were used to examine risk of repeat fusion, length of stay, and 30-day readmission by BMP use. Cost comparisons were evaluated with linear regression models using logarithmic transformed data. RESULTS: At 1 year from surgery, BMP was associated with a 1.1% absolute decrease in the risk of repeat fusion (2.3% with BMP vs. 3.4% without BMP, P = 0.03) and an odds ratio for repeat fusion of 0.66 (95% confidence interval [CI] = 0.47-0.94) after multivariate adjustment. BMP was also associated with a decreased hazard ratio for long-term repeat fusion (adjusted hazards ratio = 0.74, 95% CI = 0.58-0.93). Cost analysis indicated that BMP was associated with initial increased costs for the surgical procedure (13.9% adjusted increase, 95% CI = 9.9%-17.9%) as well as total 1-year costs (10.1% adjusted increase, 95% CI = 6.2%-14.0%). CONCLUSION: At 1 year, BMP use was associated with a decreased risk of repeat fusion but also increased health care costs.

Assessing cost-effectiveness and value as imaging grows:the case of carotid artery CT.

Computed tomographic (CT) angiography is an imaging test that is safer and less expensive than an older test in diagnosing narrowing of the carotid arteries-the most common cause of stroke in US adults. Our examination of Medicare data between 2001 and 2005 found that about 20 percent of the time this test was used, it substituted for the older test. The majority of new use, however, constituted "incremental" use, in cases where patients previously would not have received any test. We found no evidence that the growth in CT angiography led to more patients' being treated for carotid artery disease. The value of the test as a substitute for the older procedure may be enough to still justify expanding use. Tracking the uses of emerging technologies to encourage efficient use is essential, but it can be challenging in cases where new tools have multiple uses and information is incomplete.

Expanded use of imaging technology and the challenge of measuring value.

The availability of computed tomography (CT) and magnetic resonance imaging (MRI) scanning has grown rapidly, but the value of increased availability is not clear. We document the relationship between CT and MRI availability and use, and we consider potentially important sources of benefits. We discuss key questions that need to be addressed if value is to be well understood. In an example we study, expanded imaging may be valuable because it provides quicker access to more precise diagnostic information, although evidence for improved health outcomes is limited. This may be a common situation; thus, a particularly important question is how non-health-outcome benefits of imaging can be quantified.

Differences in neonatal mortality among whites and Asian American subgroups: evidence from California.

OBJECTIVE: To obtain information about health outcomes in neonates in 9 subgroups of the Asian population in the United States. DESIGN: Cross-sectional comparison of outcomes for births to mothers of Cambodian, Chinese, Filipino, Indian, Japanese, Korean, Laotian, Thai, and Vietnamese origin and for births to non-Hispanic white mothers. Regression models were used to compare neonatal mortality across groups before and after controlling for various risk factors. SETTING: All California births between January 1,1991, and December 31, 2001. PARTICIPANTS: More than 2.3 million newborn infants. MAIN EXPOSURE: Racial and ethnic groups. MAIN OUTCOME MEASURE: Neonatal mortality (death within 28 days of birth). RESULTS: The unadjusted mortality rate for births to non-Hispanic white mothers was 2.0 per 1000. The unadjusted mortality rate for births to Chinese and Japanese mothers was significantly lower (Chinese: 1.2 per 1000, P<.001; Japanese: 1.2 per 1000, P=.004), and for births to Korean mothers the rate was significantly higher (2.7 per 1000, P=.003). For infants of Chinese mothers, observed risk factors explain the differences observed in unadjusted data. For infants of Cambodian, Japanese, Korean, and Thai mothers, differences persist or widen after risk factors are considered. After risk adjustment, infants of Cambodian, Japanese, and Korean mothers have significantly lower neonatal mortality rates compared with infants born to non-Hispanic white mothers (adjusted odds ratios, 0.58 for infants of Cambodian mothers, 0.67 for infants of Japanese mothers, and 0.69 for infants of Korean mothers; all P<.05); infants of Thai mothers have higher neonatal mortality rates (adjusted odds ratio, 1.89; P<.05). CONCLUSIONS: There are significant variations in neonatal mortality between subgroups of the Asian American population that are not entirely explained by differences in observable risk factors. Efforts to improve clinical care that treat Asian Americans as a homogeneous group may miss important opportunities for improving infant health in specific subgroups.