Options to Extend Medicare's Trust Fund: Lessons From Japan's Statutory Health Insurance.

Medicare's Hospital Trust Fund is projected to become insolvent sometime during 2028 and there will be insufficient funds to cover the costs of beneficiaries' care if reforms are not made before then. Many options have been proposed on ways to extend the trust fund's solvency. Some proposals focus on controlling costs and other proposals include options for raising revenues. A fresh perspective on this policy dilemma may arise by considering Japan's statutory health insurance (SHI) and its financing mechanisms. Japan could be a useful model because it has an older population and it is facing similar fiscal challenges before Medicare. Japan could offer some useful perspectives from its cost containment efforts to extend Medicare's solvency.

How Do the Hospital Prices Paid by Medicare Advantage Plans and Commercial Plans Compare With Medicare Fee-for-Service Prices?

The prices that private insurers pay hospitals have received considerable attention in recent years, but most of that literature has focused on the commercially insured population. Although nearly one-third of Medicare beneficiaries are enrolled in a Medicare Advantage (MA) plan, little is known about the prices paid to hospitals by the private insurers that administer such plans. More information on the hospital prices paid by MA plans would provide additional insights into whether MA prices are more closely tied to Medicare fee-for-service (FFS) prices or commercial prices. Moreover, information on whether the hospital prices paid by MA plans vary with market characteristics or other factors would be useful for evaluating the performance of the MA program and analyzing proposals to modify it. In this study, we compared the hospital prices paid by MA plans and commercial plans with Medicare FFS prices using 2013 claims from the Health Care Cost Institute (HCCI) database. The HCCI claims were used to calculate hospital prices for private insurers, and Medicare's payment rules were used to estimate Medicare FFS prices. We focused on stays at acute care hospitals in metropolitan statistical areas (MSAs). We found MA prices to be roughly equal to Medicare FFS prices, on average, but commercial prices were 89% higher than FFS prices. In addition, commercial prices varied greatly across and within MSAs, but MA prices varied much less.

Are Integrated Plan Providers Associated With Lower Premiums on the Health Insurance Marketplaces?

As the health insurance industry becomes more consolidated, hospitals and health systems have started to enter the insurance business. Insurers are also rapidly acquiring providers. Although these "vertically" integrated plan providers are small players in the insurance market, they are becoming more numerous. The health insurance marketplaces (HIMs) offer a unique setting to study integrated plan providers relative to other insurer types because the HIMs were designed to promote competition. In this descriptive study, the authors compared the premiums of the lowest priced silver plans of integrated plan providers with other insurer types on the 2015 and 2016 HIMs. Integrated plan providers were associated with modestly lower premiums relative to most other insurer types. This study provides early insights into premium competition on the HIMs. Examining integrated plan providers as a separate insurer type has important policy implications because they are a growing segment of the marketplaces and their pricing behavior may influence future premium trends.

Expanding Access to Care and Improving Quality in the Mid-Atlantic States Safety-Net Clinics: Kaiser Permanente's Community Ambassador Program.

The Community Ambassador Program (CAP) in the Mid-Atlantic States Region places Kaiser Permanente-employed nurse practitioners, midwives, and physician assistants to work in the safety-net clinics and share best practices through a long-term community collaboration. The authors conducted an evaluation of 18 safety-net clinics that participated in the CAP in 2012. The Community Ambassadors provided an estimated 32,249 encounters to 11,988 patients. Performance was at or near 90% for 2 adult quality measures (weight screening and tobacco use assessment). For breast cancer screenings, however, performance among the Community Ambassadors was much lower (48%). The program expanded access and improved quality of care.

Association between the unemployment rate and inpatient cost per discharge by payer in the United States, 2005-2010.

BACKGROUND: Several reports have linked the 2007-2009 Great Recession in the United States with a slowdown in health care spending and decreased utilization. However, little is known regarding how the recent economic downturn affected hospital costs per inpatient stay for different segments of the population. The purpose of this study was to examine the association between changes in the unemployment rate and inpatient cost per discharge for Medicare and commercial discharges. METHODS: We used retrospective data at the Core Based Statistical Area (CBSA)-level from 46 states that contributed to the Healthcare Cost and Utilization Project State Inpatient Databases from 2005 to 2010. Unemployment data was derived from the American Community Survey. An instrumental variable two-stage least squares approach with fixed- or random-effects was used to examine the association between unemployment rate and inpatient cost per discharge by payer because of potential endogeneity. RESULTS: The marginal effect of unemployment was associated with an increase in inpatient cost per discharge for both payers. A one percentage point increase in the unemployment rate was associated with a $37 increase for commercial discharges and a $49 increase for Medicare discharges. CONCLUSIONS: We find evidence that the inpatient cost per discharge is countercyclical across different segments of the population. The underlying mechanisms by which unemployment affects hospital resource use however, might differ between payer groups.

Comparative health systems research among Kaiser Permanente and other integrated delivery systems: a systematic literature review.

CONTEXT: Because of rising health care costs, wide variations in quality, and increased patient complexity, the US health care system is undergoing rapid changes that include payment reform and movement toward integrated delivery systems. Well-established integrated delivery systems, such as Kaiser Permanente (KP), should work to identify the specific system-level factors that result in superior patient outcomes in response to policymakers' concerns. Comparative health systems research can provide insights into which particular aspects of the integrated delivery system result in improved care delivery. OBJECTIVE: To provide a baseline understanding of comparative health systems research related to integrated delivery systems and KP. DESIGN: Systematic literature review. METHODS: We conducted a literature search on PubMed and the KP Publications Library. Studies that compared KP as a system or organization with other health care systems or across KP facilities internally were included. The literature search identified 1605 articles, of which 65 met the study inclusion criteria and were examined by 3 reviewers. RESULTS: Most comparative health systems studies focused on intra-KP comparisons (n = 42). Fewer studies compared KP with other US (n = 15) or international (n = 12) health care systems. Several themes emerged from the literature as possible factors that may contribute to improved care delivery in integrated delivery systems. CONCLUSIONS: Of all studies published by or about KP, only a small proportion of articles (4%) was identified as being comparative health systems research. Additional empirical studies that compare the specific factors of the integrated delivery system model with other systems of care are needed to better understand the "system-level" factors that result in improved and/or diminished care delivery.

What hospital inpatient services contributed the most to the 2001-2006 growth in the cost per case?

OBJECTIVE: To demonstrate a refined cost-estimation method that converts detailed charges for inpatient stays into costs at the department level to enable analyses that can unravel the sources of rapid growth in inpatient costs. DATA SOURCES: Healthcare Cost and Utilization Project State Inpatient Databases and Medicare Cost Reports for all community, nonrehabilitation hospitals in nine states that reported detailed charges in 2001 and 2006 (n = 10,280,416 discharges). STUDY DESIGN: We examined the cost per discharge across all discharges and five subgroups (medical, surgical, congestive heart failure, septicemia, and osteoarthritis). DATA COLLECTION/EXTRACTION METHODS: We created cost-to-charge ratios (CCRs) for 13 cost-center or department-level buckets using the Medicare Cost Reports. We mapped service-code-level charges to a CCR with an internally developed crosswalk to estimate costs at the service-code level. PRINCIPAL FINDINGS: Supplies and devices were leading contributors (24.2 percent) to the increase in mean cost per discharge across all discharges. Intensive care unit and room and board (semiprivate) charges also substantially contributed (17.6 percent and 11.3 percent, respectively). Imaging and other advanced technological services were not major contributors (4.9 percent). CONCLUSIONS: Payers and policy makers may want to explore hospital stay costs that are rapidly rising to better understand their increases and effectiveness.

The relationship between hospital market competition, evidence-based performance measures, and mortality for chronic heart failure.

Using data from the Joint Commission's ORYX initiative and the Medicare Provider Analysis and Review file from 2003 to 2006, this study employed a fixed-effects approach to examine the relationship between hospital market competition, evidence-based performance measures, and short-term mortality at seven days, 30 days, 90 days, and one year for patients with chronic heart failure. We found that, on average, higher adherence with most of the Joint Commission's heart failure performance measures was not associated with lower mortality; the level of market competition also was not associated with any differences in mortality. However, higher adherence with the discharge instructions and left ventricular function assessment indicators at the 80th and 90th percentiles of the mortality distribution was associated with incrementally lower mortality rates. These findings suggest that targeting evidence-based processes of care might have a stronger impact in improving patient outcomes.

Effect of market competition on hospital performance for heart failure.

OBJECTIVES: To investigate whether market competition is a potential driver of hospital performance on the key evidence-based Joint Commission heart-failure (HF) quality indicators of angiotensin-converting enzyme inhibitor/angiotensin receptor blocker prescribed, left ventricular function assessment, smoking-cessation counseling, and discharge instructions. STUDY DESIGN: Retrospective multivariate analysis. METHODS: Hospital performance data for HF was obtained from The Joint Commission's ORYX program from 2003 to 2006. The performance data were linked with hospital characteristics from the American Hospital Association Annual Survey and area-level sociodemographic information from the Area Resource File. Healthcare markets were defined as hospital referral regions (HRRs) and market competition intensity was defined by the Herfindahl-Hirschman Index. Hospital-level and HRR-level ordinary least squares fixed effects regression models were used to estimate the relationship between market competition and performance. RESULTS: A paired comparison indicated that there was a significant change in the mean hospital-level performance over time on all of the HF quality indicators. From the multivariate analyses, hospitals in the least competitive markets (Quintile 5) performed slightly better (2.9%) than the most competitive markets (Quintile 1) for left ventricular function assessment (P <.01). At the HRR level, however, the least competitive markets (Quintile 5) performed moderately worse (5.1%) on the discharge-instructions quality indicator compared with the most competitive markets (Quintile 1) (P = .05). CONCLUSIONS: Market competition intensity was associated with only small differences in hospital performance. The level of market competitiveness may produce only marginal incremental benefits to inpatient HF care.

Evidence-based heart failure performance measures and clinical outcomes: a systematic review.

BACKGROUND: Evidence-based performance measures for heart failure are increasingly being used to stimulate quality improvement efforts. METHODS AND RESULTS: A literature search was performed using MEDLINE, EMBASE, Cochrane Review, and a citation review. Research studies that assessed the association between the American College of Cardiology (ACC)/American Heart Association (AHA) heart failure performance measures from the inpatient setting and patient outcomes were examined. Studies were restricted to those conducted within the United States from 2001 until the present and included at least 1 of the ACC/AHA performance measures for chronic heart failure and a clinical outcome as an endpoint. Eleven original studies and 1 literature review met the study inclusion criteria. Angiotensin-converting enzyme inhibitor/angiotensin receptor blocker and beta-blocker use at discharge had the strongest association with improved patient outcomes, whereas discharge instructions had a weaker but positive effect. CONCLUSIONS: The findings from this systematic review suggest that an increase in compliance with the heart failure performance measures leads to a consistent positive impact on patient outcomes although the strength, magnitude, and significance of this effect is variable across the individual performance indicators. Further longitudinal studies and additional measure sets may yield deeper insights into the causal relationship between heart failure processes of care and clinical outcomes.