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Bundling payments may make biggest dent in health care spending
Having a single flat rate for an episode of patient care -- rather than a separate charge for the various services received -- is the strategy with the most potential to reduce health system costs, according to a paper published online in the New England Journal of Medicine Nov. 11. "There are a lot of potential savings," said Peter S. Hussey, PhD, a policy researcher at the RAND Corp. Researchers analyzed data on eight options for controlling the amount of money spent on health care. Bundling payments has the potential to reduce the total cost of medical care nationally by 5.4% if used in both the inpatient and outpatient setting, and if expenses related to avoidable complications can be cut by between 25% and 50%. If bundling is applied only to hospital services, the expense reduction would be 0.1%. "Hospitals are the most feasible place to start, but it is not where the significant savings are," Hussey said. This proposal is controversial, however, and attempts by variou [Read more]
Medicare, Medicaid spent $54 billion too much in 2009, White House says
Washington -- Improper payments for health care made up a large portion of the $98 billion the federal government spent inappropriately in fiscal 2009. This total was an increase of $26 billion over the previous year, according to a report issued by the White House Office of Management and Budget. The Nov. 17 report concluded that Medicare fee for service improperly spent $24 billion in fiscal 2009, a rate equivalent to 7.8% of total outlays, and Medicaid improperly spent $18 billion, a rate of 9.6%. Medicare Advantage improperly spent $12 billion in 2009, a rate of 15.4% of total outlays on the private plans. The Medicare fee-for-service error rate was just 3.6% in 2008. The Dept. of Health and Human Services attributed some of the stark increase in improper payments to a new, more rigorous method of calculating error rates, in keeping with President Obama's stated commitment to reducing fraud and waste. "Through a more stringent review of Medicare claims, we've been able [Read more]
Aetna's Tricare contract under review for
The U.S. Government Accountability Office said it found that Aetna created the appearance of an unfair advantage in its pursuit of the Tricare contract it was awarded earlier this year. The GAO is recommending that the government re-evaluate the contract bids. Tricare is the Dept. of Defense's health plan for current and retired military service members, their families and survivors. Tricare management is split into three regions: South, North and West. The new North contract, originally awarded to Aetna, would be worth an estimated $16.7 billion over five years. The GAO upheld a contract award protest by Health Net, which holds the current Tricare contract for the North region. The partially redacted decision and recommendations were released to the public Nov. 17. Among several reasons it listed to uphold Health Net's protest, the GAO found that Aetna "created the appearance of impropriety" in its pursuit of the contract by hiring a former chief of staff for the Tricare M [Read more]
Obesity costs could quadruple by 2018
Thirty-eight percent fewer Americans smoke today than 20 years ago, but 129% more are obese, which threatens to cost the U.S. health system hundreds of billions of dollars in the upcoming decade, according to a new public health report. "There is a tsunami of chronic preventable disease about to be unleashed into the American health care delivery system," said Reed V. Tuckson, MD, executive vice president at the insurer UnitedHealth Group. Public education, taxes and restrictions on smoking appear to be working. More than 3 million Americans quit since 2008, reducing the nation's smoking rate to 18.3%, a decrease of 1.5 percentage points. The 1990 rate was 29.5%, according to the 20th anniversary edition of "America's Health Rankings," released Nov. 17 by the UnitedHealth Foundation, the American Public Health Assn. and the Partnership for Prevention. However, 26.6% of Americans are obese, up from 26.3% in 2008. If trends continue, the nation will spend an estimated $344 billi [Read more]
How your medical practice can avoid a holiday that's fa-la-la-la-lousy
The end-of-the-year holidays can be a happy, wonderful occasion, when staff can celebrate 12 months of hard work with a party, some tasteful decorations, and a few days off. Or a medical practice can become a place of rancor when celebrations hit an off-note, staff get injured decorating the office, and vacation policies result in time off being allocated in a way that is perceived as unfair. Experts say your practice can foster the first scenario and make the latter less likely by asking the staff how they want to celebrate and doing so in a way that reflects the values of the practice. "There's enough stress on everyone. You don't want to add to it," said Demetrian Dornic, MD, medical director of the Eye Specialists of Carolina in Raleigh, N.C. "We look at our employees as very valuable. I want them to feel appreciated." This can manifest in different ways. Last year, employees at the East Tennessee Medical Group in Alcoa decided to forgo a holiday party and contributed t [Read more]
Medical lawsuit limits favored by public
Physicians and other tort reform advocates say an Associated Press poll released Nov. 19 shows the public agrees that limiting medical liability lawsuits is key to successfully overhauling the health care system. The nationwide survey by the news organization showed that 54% of Americans favor limits on such lawsuits, while 32% opposed such measures ( The phone interviews with 1,502 adults, which also covered other aspects of health system reform, were conducted from Oct. 29 to Nov. 8 by GfK Roper Public Affairs & Media and Stanford University, with funding from the Robert Wood Johnson Foundation. Fifty-nine percent of respondents said they believed that at least half of the tests physicians ordered were done unnecessarily, based on doctors' fears of being sued. "If we are going to provide health insurance coverage, we need to get rid of the unnecessary health care costs," and defensiv [Read more]
Younger seniors reporting more disabilities
Americans in their 60s are living with more disabilities than did their cohorts from previous generations. And that could overwhelm the country's health care system, according to a study published online Nov. 12 by the American Journal of Public Health ( The authors compared two National Health and Nutrition Examination Survey data sets, for 1988-1994 and for 1999-2004, to examine disabilities for adults age 60 to 69, 70 to 79, and 80 and older. All age groups reported significant declines in physical activity. But the youngest group had the greatest increase in reported disabilities. The authors assessed the disability trends of 8,927 individuals based on their responses to questions addressing four areas: basic activities of daily life (including getting out of bed); instrumental activities (including household chores); mobility (including climbing 10 steps without stopping) and functional limitations (inclu [Read more]
Charity care found straining practices in Pennsylvania
More patients are asking for medical care at no cost, and physicians are struggling to meet the increase in requests, according to a report issued Nov. 18 by the Pennsylvania Medical Society's Institute for Good Medicine. "Even though our physician members are doing more for the uninsured and underinsured, many feel they're reaching their limit," said Peter Lund, MD, the institute's founder, and a urologist in Erie. "With the state of the economy, I'm not surprised by this year's findings, and, clearly, this could signal problems ahead." Approximately 80% of member physicians surveyed donated time, resources or both, and those donations added up to a cash equivalent of $400 million, according to the institute. The survey said 57% felt the demand for charitable care had increased; 62% felt levels had become unsustainable. The American Medical Association's Code of Medical Ethics says physicians should work to ensure that the needs of the poor in their communities are met. If ph [Read more]
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