1 January 2016
Dear Interested Readers,
Inside This Week’s Letter
It is the first day of the New Year. Perhaps by now you have shaken off all of the excesses of last night’s frivolity and have had a walk to further clear your head in preparation for the new year. There is still football on the television. The announcers of the umpteenth bowl game of the day are trying their best to maintain your interest even though the score is lopsided and the ads between the action have all been shown a hundred times or more and yet keep coming. Now is a good time to think about what lies ahead as you start the new year at work on Monday!
This letter is about the future and the work to be in done 2016 if we decide to take Don Berwick’s challenge and have a more concerted movement toward the promises for all that are contained within the Triple Aim. I have included a review of a recent NEJM article and finish with a look back at what we were not expecting to experience and did not experience in 2015.
If you remember to check strategyhealthcare.com this week you will find a new piece entitled “The Digital Doctor 2016”. It is an expansion of a report I gave you on December 11 of a presentation at IHI by Robert Wachter, and includes a link to a report this week from the Boston Globe about his book from last April, The Digital Doctor. If there is a friend or colleague that you think might enjoy either the SHC (Strategy Healthcare) site or these weekly musings, please refer them to the site where they can sign up.
Continuing to Improve
One of my favorite moments in the “liturgical year” of our practice was the annual awards dinner. I cherish the many memories of those great evenings with my colleagues. It was always a moving experience to hear stories about the innovative programs that had been developed and introduced in the last year from all around our many care sites. Even better than the celebration of the improvements and innovations were the stories behind what had happened and the recounting and recognition of exceptional acts of care. Awards were given for accomplishments of note in the past year and for service over many years and even entire careers. The event began in the early eighties as a project piloted by Paul Solomon who was my predecessor and mentor as Chairman of the Physicians’ Council as an event for physicians only, but it soon became an event that recognized healthcare professionals of all types from across the practice.
My second reason for enjoying the evening so much was that we always had a great speaker. A short list of some of the best would include Atul Gawande, Gary Kaplan, Don Berwick more than once, The Governor of Colorado, and Lenny Marcus from the Harvard Negotiation Project and the Harvard School of Public Health. The talk from recent years that I remember best and enjoyed the most was given by Steven Spear from MIT. Dr. Spear is the well known author of The HIgh Velocity Edge, which is one of the classics of Lean literature. If you click on Dr. Spear’s name you will be able to hear his very short explanation of how some of the problems we face in healthcare arose and could benefit from the principles that he outlines in the book. If you have an hour to invest and let YouTube roll on or click on this link you will hear a very helpful webinar from the Sloan School at MIT that features Dr. Spears.
We had asked Dr. Spears to speak to us because we were early in our Lean efforts and were interested in his insights from other industries. The part of his speech that interested me most concerned rapid prototyping to solve complex problems. It was a theme that resonated with me, having read Bob Johansen’s Leaders Make the Future: Ten New Leadership Skills for an Uncertain World. You can click here to review those skills and to reflect on your own competency for leading into the future. Johansen lists “rapid prototyping” as one of those ten new competencies.
Spear made his point about rapid prototyping by first showing a picture of what was under the hood of a model T. Then he showed what was under the hood of a new Ford Mustang. It was obvious that the Mustang was a much more complex car. As Spear continued to talk about the new complexity in the automobile industry and how rapid prototyping was essential to product development, I could easily relate the analogy that he was making to healthcare.
It turns out that I am the long time owner of a 1968 Mustang convertible. My ragtop has the standard old straight six engine; not the the more romantic and highly prized 289 v8 that was the heart of the “Muscle Car” that is an iconic image that you might connect to Steve McQueen in the Thomas Crown Affair. When I bought my Mustang in 1989 I looked at a 289 that was available but I had a longtime desire to learn how to work on cars and the old straight six seemed to be the place to start. I never achieved my dream of becoming an amateur mechanic who could work on his own car but I have had the Mustang rebuilt twice over the years. I probably could have bought a new Porsche for what I have sunk into my fantasy. Looking under the hood of the current model Mustang on Spear’s slide I would never have even dreamed that I could have changed the oil. It was just too complex.
Ironically, I started med school in 1967 not long before my “simple six cylinder” car was built. Both cars and healthcare were much simpler then. Now manufacturers have a much bigger problem than Lee Iacocca had in 1964 when he introduced us to the first Mustang. That car went from concept to sales in a very short time essentially by taking bits and pieces of other Ford models and putting them together in a new package. The “sixth generation” Mustang has thousands of parts that were either redesigned or invented to make a new model that looks a little like the old one that I own on the outside, but is several orders of magnitude more complex at its heart. I think the analogy to healthcare holds up pretty well comparing healthcare in 1968 to healthcare in 2016.
The ACA is now five years old. Like a new complex automotive product its creation could be described as an exercise in rapid prototyping. Some of the pieces were reengineered parts from earlier models of healthcare and some of the parts were new inventions. I am sure that the President would have said in 2010 that the ACA was going to need road testing to work out all the bugs. I could imagine that the strategy was to get it out there, use it, understand what was good and improve it and understand what looked good in concept but was not good in reality and discard or redesign the imperfect parts. We should have had ACA 1.1 if not ACA 2.0 or 2.5 by now. I am certain that in time further revisions will occur, just as we have seen a series of upgrades to Medicare and Medicaid since they were passed 50 years ago. What we have had so far is the equivalent of vandalism, not reengineering, as the conservative members of Congress and the Supreme Court have tried their best to smash its windows and puncture its tires, since they have not yet succeeded in driving it over a cliff.
This week’s New England Journal of Medicine offers us food for thought as we contemplate the ACA at five years and look forward to its next challenges in 2016. If you have not read it, the article is by Dr. B.D. Sommers from the Department of Health Policy and Management, Harvard T.H. Chan School of Public Health and is entitled “Health Care Reform’s Unfinished Work- Remaining Barriers to Coverage and Access”. Fortunately it is an “open access” article that anyone can read whether they are a subscriber or not. Below you can read a condensation of the article with my comments.
Dr. Sommers begins by succinctly saluting the great accomplishments of the ACA and summarizing its failures. He notes,
“The U.S. uninsured rate is lower than ever, and coverage gains appear to be improving access to primary care and medications, affordability of care, and self-reported health. But challenges for health care reform persist: millions of Americans are still uninsured, and even for those with coverage, substantial barriers remain to obtaining affordable, high-quality care.”
There is a great combination of pie charts that shows who was helped and where the problems still exist because “..more than 30 million U.S. children and adults still lack insurance…” The article goes on to review, “Who are they, and what policy options exist for covering them?”
Here is a brief list I have made that captures the identity of the uninsured: - Low-income adults in the 20 states that haven't expanded Medicaid under the ACA. He points out that the ACA “envisioned a seamless set of insurance options: Medicaid for people with incomes below 138% of the poverty level and tax credits for those with incomes between 138 and 400% of the poverty level to subsidize premiums for insurance purchased through state-based exchanges. But 3 million to 4 million uninsured adults in states that haven't expanded Medicaid are caught in the “Medicaid gap”: their incomes exceed their states' Medicaid eligibility criteria but are too low to qualify them for exchange subsidies. Approximately two thirds of remaining uninsured people are eligible for coverage but haven't signed up, or did so but then dropped out. Most of them have incomes below 400% of the poverty level and qualify for subsidized insurance.
- Many Americans remain unaware of the ACA's coverage options. This is despite a lot of “ ...ongoing media and community-based outreach — particularly to adults with low incomes, minimal health care experience, or cultural or language barriers… He notes that some states have “enacted regulations to reduce the availability of application assistance, doing their uninsured populations a major disservice.”
- The cost of care is a continuing barrier. For many Americans who know about the ACA's options but choose not to enroll, cost is the most significant barrier.
- There are more millions of undocumented immigrants without care. Finally, about 15 to 20% of the remaining uninsured population consists of undocumented immigrants, who are excluded from the ACA's coverage expansion.
It is worth emphasizing that although access is improved the cost overall and the cost to individuals has not improved and is anticipated to get worse. Many patients theoretically have access but the product they have purchased has cost barriers to better care.
Meanwhile, even for people who gained insurance under the ACA and the tens of millions who already had coverage, substantial barriers to timely access to affordable medical care remain. Two features of exchange-based coverage — high cost sharing and narrow provider networks — can limit access and are increasingly common in employer-sponsored plans as well.
Deductibles that averaged about $3000 in 2015 for “silver” plans and $5,200 for “bronze-level” plans have probably had had a big impact that has reduced the use of unnecessary care but have also caused many to avoid care that they needed, despite elements of the ACA to prevent that reality by exempting preventative care from the deductible calculations. Dr. Sommers also points out that although “narrow network” products help keep prices down they may also exclude access to necessary specialty care. Cost also remains an issue in Medicaid where low reimbursement rates diminish access.
Many of these concerns that are easier to recognize after the ACA has had five years of road testing should be fixed and would be except for the continuing political debates. This year, as an election year, may be lost as we pause for the election process. Some people still favor a single payer model and Colorado has a single payer model on its ballot despite the experience in Vermont.
Sommers speculates that even though “repeal and replace” is an appealing political slogan for some conservative politicians:
“...the almost-certain backlash against taking coverage away from more than 15 million Americans makes it hard to imagine this rhetoric becoming reality, even if Republicans control Congress and the White House after 2016.”
Sommers predicts “incremental change” and makes suggestions throughout his article.
- Several Republican-led states are still seeking compromises to expand Medicaid, and the Obama administration can continue to facilitate Medicaid expansion in conservative states by supporting flexibility for alternative approaches. As a stopgap, Congress could extend insurance tax credits to persons living below the poverty level who are not Medicaid-eligible, though they might find even heavily subsidized premiums unaffordable.
- ...some people with higher incomes qualify for little or no premium subsidy for exchange coverage. Facing a penalty that remains substantially lower than a year's worth of premiums, some have decided against purchasing coverage. Policy options here include increasing subsidies for higher-income families and strengthening the mandate that individuals obtain insurance — though the former would be quite costly and the latter would further antagonize most opponents of the mandate.
- Another alternative is replacing the mandate with incentives similar to those in Medicare Parts B and D: higher premiums for each month that a person chooses not to obtain coverage. But it's unclear how easy it would be to implement such a policy for people younger than 65 who regularly cycle in and out of coverage, unlike the Medicare population.
- ...efforts to control health care costs and thus premium growth will help determine whether coverage rates continue to climb.
- ...sensible plan design would...encourage ongoing management for chronic conditions….such as diabetes, heart disease, and hypertension, without patients first having to exhaust several thousand dollars in out-of-pocket spending.
This article should help us focus on the work ahead as we face 2016 and ask ourselves what we should do next if we are to experience the benefits of the Triple Aim:
Care better than we have ever seen, health better than we have ever known, cost we can all afford, …for every person, every time.
Despite improvement for many through the passage of the ACA what has been gained remains at risk until we control the cost of care to reduce the burden on those who now have access as we continue to search for affordable ways to enroll the thirty million people among us who continue without access to care. One way to join a movement that might make progress toward such a lofty goal is to ask the question, “What part of the problem am I?” or “What part of the problem is my practice or organization?”. Those are scary questions. We would rather see the need for improvement in others than in ourselves but the only areas of improvement where what you decide to do today, you can start today, is in those areas where you are the focus of improvement! Many movements seek to get other people to change. If we want a real movement toward universal coverage with high quality care for everyone at a sustainable cost the first changes must be within ourselves and within our own organizations. There is much that can be accomplished through reworking the ACA, but the cost issue no matter what finance mechanism is used along the spectrum of payment from FFS to “single payer” is within the control of healthcare itself. Eliminating waste and improving outcomes through the science of continuous improvement and the exercise of better stewardship of resources at the personal and the institutional level requires no amendments to the ACA. Those improvements are a choice that we can make no matter what Congress does.
The ACA is a start, not a destination. It will be up to us working together in 2016 to begin to deliver on the promise it offered as a product of rapid prototyping back in 2010.
What Did Not Happen In 2015?
Earlier this week I was curious about what I had written this time last year. To my surprise I found that I had referenced an article written by Paul Keckley of Navigant Consulting that was a list of the “Top Ten Healthcare Headlines You’ll Not Read in 2015”. I thought it would be fun to see how that list held up:
The first prediction was that physicians would not become optimistic about their future or be wildly accepting of computers in healthcare. The list of things that worry doctors and contribute to burnout has probably gotten longer, not shorter, in 2015. Let’s hope that we turn that around in 2016.
Prediction number 2 was that the ACA would not be repealed. I am thankful that that was true but as reviewed in the first section, change is needed not only in the letter of the law but also in how we make it work.
Number 3 translated into another good year for health insurance companies. This one might be rejected by United Healthcare based on the fact that they publicized that they may be dropping out of the exchanges because they were losing money, but in general the profits of insurers have remained high.
Number 4 suggested that hospitals would continue to experience shrinking margins. Except for some of the biggest systems this one probably turned out to be true. Each week I read about more hospitals closing because of financial losses. Mergers seem to be getting harder as the Justice Department questions the motives behind getting bigger. When will they ever learn? If revenue is down, building a new bed tower or buying a robot is not the way out of the woods. An investment in Lean and looking for waste to eliminate is a more logical way to repair a bottom line when everyone is experiencing a downward pressure on revenue.
I am just guessing about number 5. Keckley predicted that the FDA would not back off of its efforts regulate and control medical devices and pharmaceuticals. I think that he is right and I know that everyone who talks about healthcare costs in the future and the rate at which they are rising makes “Big Pharma” number one on their villains list. The FDA has not backed off but there does not appear to be much progress either.
Number 6 predicted that CVS would continue to be a disruptive innovator. I think that remains true. They are installing Epic! Perhaps we should ask for 2016 how many people will get most of their primary care at CVS. I bet the number would surprise us.
There is a surprise in number 7. Dr. Keckley predicted that Meaningful Use would not be repealed despite the cries of pain from physicians and practices about what a burden it is. What did happen is that Meaningful Use will be massaged along with many other pay for performance programs into the MIPS part of MACRA, the new SGR replacement. So it will change in time but not in 2015 or 2016.
I would have made number 8 number 1. The prediction was that CMS would not kill ACOs and would not revert to volume based reimbursement. That and more was true. At the end of 2015 the ACO concept and the progress of the transition from volume to value has moved faster and farther than most people had anticipated. The pace of the change in payment has become the major factor in the transformation of healthcare that no one can ignore. This rapid transition has been driven by CMS but the insurers are following their lead and may push further and faster than CMS. The move to value as we begin 2016 is the greatest driver of healthcare reform and much more important than any other thing including the ACA. The volume to value transition will spawn innovation and perhaps continuing evolution of legislation toward a better ACA.
I wish that number 9 had turned out to be true. It is my biggest worry. Healthcare costs did not go down and it is hard for me to admit that almost all of that work still lies in the future. I was particularly disappointed by the data coming from Massachusetts. The question for 2016 is what will we do differently based on what we learned in 2015. That is the question that I will ask when I attend the next meeting of the Advisory Council of the Health Policy Commission on January 16.
Finally, perhaps of not much interest to many readers of these musings, was the prediction that investors would continue to look for ways to make money in healthcare. Healthcare has attracted and will continue to attract enormous amounts of investment capital. Ironically there is a lot of money to be made in reducing the cost of care as we move from volume to value.
It was a good list. I think that we can roll it over and get a lot of mileage out of it as a guide to 2016.
A Change In The Weather
As you can see from the picture in the header, we now have a little winter in New Hampshire. What you see in the picture is what I see from the chair by the fire where I sit to write these letters. If you look closely you can see the ice growing out from the shore. Most winters the ice gets to be two feet thick and you can drive a truck on it. It usually persists until mid April. Life is an adventure with unexpected events. Who knows what will happen this year?
I do know what happened last year on my walks. I covered 1388 miles. It is amazing what you can do if you take it a day at a time, one step at a time. My goal for 2016 is 1500. Having goals is a good strategy. Measuring progress against those goals keeps us on track toward the outcomes we desire.I hope that you will walk with me, either figuratively or literally, as we take care of ourselves even as we try to take care of everyone by intensifying our movement toward the Triple Aim. Let’s ponder the goals that make sense for our movement in 2016. This time next year it will be fun to see how we measured up against those expectations.
2016 could be a breakthrough year. I do not know how you are looking at the next twelve months but I invite you to join with me as we work together to find thousands of ways, large and small that we might contribute to the coming of the moment when it is true that we can say we have:
Care better than we have ever seen, health better than we have ever known, cost we can all afford, …for every person, every time.
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