Frank Diamond

Managing Editor

Health reform means that much of what health insurance plans did is being taken on by providers. An obvious example is the Choosing Wisely campaign, an effort by physician professional organizations to cut down on overtreatment and overtesting.

The Affordable Care Act shifts a lot of the responsibility and financial risk onto providers, and some doctor groups are rising to the challenge, says John Cuddeback, MD, PhD, chief medical informatics officer for the American Medical Group Association. The AMGA represents a variety of physician group types. More than 130,000 physicians practice in AMGA member organizations, providing health care services for 120 million patients, approximately one in three Americans.

Cuddeback cites the Holston Medical Group (HMG), of Kingsport, Tenn., which has about 150 primary care physicians, specialists, and mid-level providers. In about 2.5 years, HMG reduced hospital admissions per month by 20% for Medicare fee-for-service patients and by 28% for Medicare Advantage and commercial patients. It’s saving about $23 per member, per month overall.

Holston Medical Group Hospital Admits Since 2011

Part of this was achieved by creating an ambulatory intensive care option – a place to keep patients for a few hours who are too ill to be managed in a physician’s office, but who don’t require inpatient hospital care. “They get them stabilized, even let them go home to sleep in their own bed – hospitals can be disorienting, especially for elderly patients, not to mention the risk of infection – and come back tomorrow for more treatment,” says Cuddeback. “The overall cost is much less, and the outcomes are better.”

For commercial contracts, HMG is 3.2% better than market in quality performance, 8.1% better than market in total medical cost. This is a good example of how compensation models are changing, says Cuddeback.

Frank Diamond is managing editor of Managed Care.

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.