John Marcille

John Marcille

Humor depends on truth, and a funny sequence in a currently running situation comedy involves a television executive making a cameo appearance on one of his shows. Suddenly, reflexive actions become an amateur actor’s overdone gestures. When he “walks” into the scene, he resembles the just oiled Tin Man in The Wizard of Oz.

Incentives, the subject of our cover story, are a given in human interaction. We offer them. We respond to them. Like the idea of “luck,” they can be, and often are, the subjects of studies. We all have our stories.

Uwe Reinhardt, the Princeton health economics professor, says that he can always tell when a European or Asian student hands in an exam because it’s so neat. Some American youngsters can write well, but “you would be shocked” at how much of their work is nearly indecipherable.

“And why is that?” says Reinhardt. “I recall looking at my own kids’ homework and, from time to time, ripping it up late in the evening, forcing them to redo it. The kids protested that it was perfectly all right, as their teacher accepted it. I told them that was fine, but I did not accept it. I thought it was rude to hand in sloppily written work. It did not take long before neater work became instinctive to them — just as I was literally slapped once as an apprentice when my boss found my work sloppy.”

Edwin Locke, PhD, a retired professor of management and psychology at the University of Maryland, says that incentives have always been used in business, but usually with tight monitoring. He cites as an example the pay-for-performance program instituted by Jack Welch when he ran General Electric. “He had very stringent controls.”

Maybe the best control is pride in workmanship, as Reinhardt says in a sidebar to the cover story. He believes that physicians are as much swayed by public rankings as they are by financial rewards. Clinical executives at insurers have probably noticed this as well.

Managed Care’s Top Ten Articles of 2016

There’s a lot more going on in health care than mergers (Aetna-Humana, Anthem-Cigna) creating huge players. Hundreds of insurers operate in 50 different states. Self-insured employers, ACA public exchanges, Medicare Advantage, and Medicaid managed care plans crowd an increasingly complex market.

Major health care players are determined to make health information exchanges (HIEs) work. The push toward value-based payment alone almost guarantees that HIEs will be tweaked, poked, prodded, and overhauled until they deliver on their promise. The goal: straight talk from and among tech systems.

They bring a different mindset. They’re willing to work in teams and focus on the sort of evidence-based medicine that can guide health care’s transformation into a system based on value. One question: How well will this new generation of data-driven MDs deal with patients?

The surge of new MS treatments have been for the relapsing-remitting form of the disease. There’s hope for sufferers of a different form of MS. By homing in on CD20-positive B cells, ocrelizumab is able to knock them out and other aberrant B cells circulating in the bloodstream.

A flood of tests have insurers ramping up prior authorization and utilization review. Information overload is a problem. As doctors struggle to keep up, health plans need to get ahead of the development of the technology in order to successfully manage genetic testing appropriately.

Having the data is one thing. Knowing how to use it is another. Applying its computational power to the data, a company called RowdMap puts providers into high-, medium-, and low-value buckets compared with peers in their markets, using specific benchmarks to show why outliers differ from the norm.
Competition among manufacturers, industry consolidation, and capitalization on me-too drugs are cranking up generic and branded drug prices. This increase has compelled PBMs, health plan sponsors, and retail pharmacies to find novel ways to turn a profit, often at the expense of the consumer.
The development of recombinant DNA and other technologies has added a new dimension to care. These medications have revolutionized the treatment of rheumatoid arthritis and many of the other 80 or so autoimmune diseases. But they can be budget busters and have a tricky side effect profile.

Shelley Slade
Vogel, Slade & Goldstein

Hub programs have emerged as a profitable new line of business in the sales and distribution side of the pharmaceutical industry that has got more than its fair share of wheeling and dealing. But they spell trouble if they spark collusion, threaten patients, or waste federal dollars.

More companies are self-insuring—and it’s not just large employers that are striking out on their own. The percentage of employers who fully self-insure increased by 44% in 1999 to 63% in 2015. Self-insurance may give employers more control over benefit packages, and stop-loss protects them against uncapped liability.