Category Archives: Mandated health care

Integral Healthcare

Doubling down on contentious issues is not just confined to the realm of politics.

An article in Monday’s Journal of the American Medical Association (JAMA) states that single payer for the United States is politically infeasible, and concludes that to achieve universal coverage without single payer, enforcing the individual mandates and assessing real penalties for not purchasing insurance is the best option.

To bolster their argument, the authors, Regina E. Herzlinger, Barak D. Richman and Richard J. Boxer, point to three countries that have a private-sector insurance system. These countries are Switzerland, Singapore, and Germany.

After exploring two other options, creating risk pools for enrollees with preexisting conditions, and pooling costly patients into Medicare, the authors contend that the individual mandate, which the Supreme Court characterized as an annual tax, would be assessed against individuals who did not purchase health insurance within that calendar year.

The authors believe that while it is vilified by some, it is attractive for the following reasons: it is easy to implement, is effective in pooling risk, and reflects the values of individual responsibility (more on values later).

But the authors are mistaken. Many Americans will balk at paying for health insurance, with or without penalties, for individualistic, libertarian reasons. Also, those individuals who are unemployed and who have not filed tax returns for several years, at least under the ACA as it is now enacted, will not be able to get even a subsidy to pay for it. (my own situation that I contacted my Congressman about twice)

Per the authors, Swiss citizens must purchase health insurance, if they do not, the government does it for them. And the insurers can implement debt enforcement proceedings against anyone failing to pay for insurance, collect a penalty and any back premiums.

Singapore has compulsory contributions from employers on behalf of their employees to create medical savings accounts, and it is up to the employee to maintain these accounts for expenses such as health and disability insurance premiums, hospitalization, surgery, rehabilitation, end-of-life care, and outpatient services. Failure to do so are subject to garnished wages and other legal actions. The unemployed, or poor are eligible for subsidies.

Lastly, German insurance is funded by compulsory contributions to private insurers levied as 7.3% of income. Those who are unemployed have theirs taken out of their benefits plus means-based sliding-scale subsidies, and uninsured, self-employed individuals who try to purchase insurance are faced with payment of back premiums for the uninsured period.

Some of the methods described above have been suggested here in the US, or are part of the ACA already, but is not sufficiently strong enough for the authors, or maybe part of the “repeal and replace” packages now stalled in Congress. Therefore, the authors have decided to double down on the one part that the GOP wants to eliminate and that many Americans find onerous, paying a penalty for not having insurance.

But is this really the right way to go, as I mentioned in yesterday’s post, “Damned If You Do, Damned If You Don’t.”

To answer that question, I would like to introduce you to Spiral Dynamics and the next generation economic system, MEMEnomics.

Spiral Dynamics is a biopsychosocial theory of human development based on the research of the late psychologist, Clare W. Graves. Graves was a contemporary of Abraham Maslow, whose “hierarchy of needs” was the first psychology model of a hierarchical nature of human development.

Graves’ framework, called the “Levels of Human Existence”, relates to Maslow’s needs, but Graves realized that Maslow’s model did not adequately express the dynamics of human nature, the process of emerging systems, or the open-endedness of the psychological development of a mature human being.

“Briefly, what I am proposing is that the psychology of the mature human being is an unfolding, emergent, oscillating spiraling process marked by progressive subordination of older, lower-order systems to newer, higher-order systems as an individual’s existential problems change. Each successive stage, wave, or level of existence is a state through which people pass on their way to other states of being. When the human is centralized in one state of existence, he or she has a psychology, which is particular to that stage. His or her feelings, motivations, ethics and values, biochemistry, degree of neurological activation, learning system, believe systems, conception of mental health, ideas as to what mental health is and how it should be treated, conception of and preference for management, education, economics, and political theory and practice are all appropriate to that state.”

Graves proposed that all the forces shaping the marketplace, whether individuals, groups, or cultures, should be looked at from a more integral view that includes the biologic, psychologic, and sociologic aspects, and to examine them in an ever-evolving dynamic culture. He placed these dimensions into eight known hierarchical levels of existence called value systems.

Graves’ ideas would have remained confined to the academic world if it was not for his colleagues, Don Beck and Christopher Cowan, who patented Graves’ work into what they called Spiral Dynamics, taking the name from Graves’ explanation of human psychology. They even wrote a book by that title, which should be read first to gain full understanding of the theory.

When they began their work, they translated Graves’ levels (he used pairs of letters starting from “A” to “H” and from “N” to “U” to represent the life conditions and ways in which humans solved their existential problems) to colors (Beige, Purple, Red, Blue, Orange, Green, Yellow, and Turquoise). This was a way to better memorize the vMEMEs, borrowing the term, meme, from Richard Dawkins, or value systems.

The following table shows the vMEMEs and the percentages found in the population, plus the percentage of power they have in human society. It is important to note that the American population can be found in the last three levels. It is the Blue/Orange vMEMEs that control much of the political, social, and economic agenda of the US, and explains why Green’s values have had a hard time getting accepted, which is why the US is unable to make the leap to the next tier.

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Dawkins described memes as “a unit of cultural information that is capable of self-replication and uses the human mind as a host.” For Beck and Cowan, vMEMEs, or value-systems memes begin to shape how individuals, organizations, and cultures think. Along the way, Beck partnered with philosopher Ken Wilber, whose Integral approach was adapted to Spiral Dynamics into Spiral Dynamics Integral.

The following chart illustrates the AQAL model of Spiral Dynamics Integral.

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There are two alternating types; individualistic and expressive, and group-oriented and sacrificial. Both types alternate, and with the passage of time, existential problems arise within each value system that can no longer be solved at the current level. The pressure and energy created by the value system’s inability to solve its problems leads to the emergence of the next level, spiraling upwards and alternating between the types.

So, for example, Capitalism is an individualistic vMEME system, whereas Socialism is a collective vMEME system.

Which brings us to discussing MEMEnomics. MEMEnomics is a composite of the words “meme” as we have been discussing, and economics. The book titled MEMEnomics, by Said W. Dawlabani, is sub-titled, “The Next-Generation Economic System.”

I have read it once, and in the process of re-reading it for better understanding, and explains clearly through Spiral Dynamics why the financial difficulties of the last decade occurred, and guides us to a better, integrated, and holistic future. Dawlabani says that the difficulties the US is facing today (published in 2013) are a result of the evolution from one system to another.

But most importantly, Dawlabani examines the history of the American economy from colonial times to the present day through a memenomic framework, that corresponds to the levels of human existence found in Graves’ work.

These two charts illustrate MEMEnomics and Spiral Dynamics better.

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Already, there are changes occurring in the economy that signal that there is an evolution. The emergence of the sharing economy found in companies like Uber and Lyft, and Airbnb, are just some of the examples of this emergence. The green economy, as in environmentally friendly, is an example of the healthy side of the Green vMEME, and even exhibits some aspects of Yellow Sustainability.

So where does health care fit in all this?

Health care as it is provided for in the US, is mostly through employers, government programs aimed at specific demographic groups such as the poor, elderly, and children, and through private insurance sold by insurance companies.

The reason for the passage of the ACA was to eliminate some of the disadvantages in employer and private health insurance plans, and to ensure coverage for all by making people purchase coverage. But that has angered many, and is the main reason for the repeal and replace rhetoric in Washington.

The authors of the JAMA article, like many before them, are doubling down on a method of providing coverage that is trapped within the Orange vMEME system. Yet, as Spiral Dynamics and MEMEnomics has shown, there must be an evolution in the way we think about many aspects of human life, health care and its provision included.

We must build the health care system of the future now, not the health care system of the past. Spiral Dynamics and MEMEnomics points us to a future where all aspects of human civilization is integrated and holistic, and health care is a part of that integration.

Any doubling down on the value systems of the past as human development spirals upward is unhealthy and must be avoided. If we continue to require the purchase of a commodity such as health insurance (Orange vMEME – value system) when human development has transcended and included Orange and moved on past Green into Yellow or Turquoise, it would be like Americans living today living like their ancestors did back in Roman times.

I don’t think that is possible, nor is it desirable. And neither is the solution the authors have recommended. We must integrate all our current health care systems into one integrated system, including Workers’ Comp, not because it will save money (which it will), but because human development is headed in that direction.

Not to do so is harmful to the spiral and to human development.

Final Rule for Bundled Hip and Knee Replacements Published

Four months ago today, I wrote a piece called, “CMS to Require Bundling of Reimbursements for Hip and Knee Surgery”, that said the Centers for Medicare & Medicaid Services (CMS) will require the bundling of reimbursements for hip and knee surgeries.

Today, Health Affairs blog published an article reporting that CMS has recently published the final rule for the Comprehensive Care for Joint Replacement (CJR) model, which is a mandatory bundled payment model for lower extremity joint replacement (LEJR) services in certain geographic areas.

The article, by Patrick H. Conway, Rahul Rajkuma, Amy Bassano, Matthew Press, Claire Schreiber and Gabriel Scott, said that hip and knee replacements are the most common inpatient surgery procedures for Medicare beneficiaries, and can require long recovery and rehab periods.

The authors said that in 2014, more than 400,000 beneficiaries received hip or knee replacement, which cost more than $7 billion just for hospitalization.

They also reported that the quality and cost of care for these surgeries varied significantly by region and by hospital, and was true for both the care received in the hospital and for post-acute care outside.

The variation, they said, is due to the way Medicare pays for this care today, spread among multiple providers, with no single entity accountable for the total patient experience.

Care can be fragmented, they wrote, which leads to adverse outcomes.

Here are the key takeaways from the final rule:

  • the CJR model seeks to incentivize Medicare providers and suppliers to work together to improve the quality and reduce the costs of care for patients undergoing lower extremity joint replacement
  • the acute hospital where the procedure occurs will be accountable for aggregate Medicare expenditures and the overall quality of related care
  • the model will include participant hospitals located in 67 Metropolitan Statistical Areas (MSAs) throughout the country
  • acute hospitals paid under the Inpatient Prospective Payment System (IPPS) and located in the selected MSAs will be included in the model, with the exception of hospitals currently participating in Model 1 or Models 2 or 4 of the Bundled Payments for Care Improvement (BPCI) initiative
  • depending on the hospital’s quality and aggregate spending performance, the hospital may receive an additional payment from Medicare, or need to repay Medicare in the second year if spending exceeds targets
  • hospitals will need to work with physicians and post-acute care providers, such as home health agencies and skilled nursing facilities, to ensure patients get the care they need

This is in contrast to what I reported on in July, when I said that a former CMS official was cited in the Freeman article as saying that mandatory bundled payments for hip and knee surgeries would shutter one in four skilled nursing facilities and trigger “demand destruction in areas such as diagnostic testing, hospital stays, and avoidable readmissions.”

Whether or not this final rule will do what the authors of the Health Affairs article says it will do remains to be seen, but judging by past CMS programs to affect quality and costs, this may be wishful thinking on the part of the authors.

The insistence that one more new initiative, or more incentives, or one more new model or new rule will change the way health care is being provided in the US, just goes to show that until we adopt a single-payer, “Medicare for All” system with less rules and less incentives, some people will continue to game the system, then we will see a radical change in the American health care system.

And if workers’ compensation follows changes in health care under Medicare, especially how it determines reimbursements for hip and knee surgeries, which are also common to workers’ comp, we can expect to see issues in workers’ comp.

Alternatives must be considered to an ever expensive and poor quality of health care for workers’ comp. That alternative is medical travel.

New Study Confirms ACA May Shift Claims to Work Comp

The Workers’ Compensation Research Institute (WRCI) released a study today indicating that the Affordable Care Act (ACA) may shift claims into workers’ compensation.

Readers of this blog will have read by now the following posts from earlier this year that discussed at length what many in the workers’ compensation and insurance industries said would happen under the ACA.

Here are the posts:

Accountable Care Organizations May Shift Claims into Workers’ Comp

Failure to Expand Medicaid Could Lead to Cost-Shift to Work Comp

Update on Affordable Care Act’s Impact on Workers’ Comp

Challenges Remain in Physician Payment Reform

The WCRI study is quite long, so I will only give you the introduction and summary of findings. You may purchase the complete study by clicking the following link: http://www.wcrinet.org/result/will_aca_shift_wc_result.html.

The study begins by asking the question, “what is the extent to which the move to “capitated” group health arrangements under the ACA leads to cases that previously would have been paid under group health insurance to end up being paid under workers’ compensation.”

They refer to this as case-shifting, as opposed to cost-shifting, and state that if just 3% of group health cases with soft tissue injuries were shifted to workers’ comp, workers’ comp costs in a state like Pennsylvania could increase by nearly $100 million.

In California, the increase would be higher. More than $225 million, and in Iowa, the additional workers’ compensation costs would be around $25 million, or about 5% of the total benefits paid.

One mechanism the WCRI says by which cases would be shifted to work comp is the growth in the number of patients covered by “capitated” health plans.

Medical providers are reimbursed for each procedure in traditional fee-for-service medicine, which is often called, retrospective reimbursement.

Under capitated plans, the study says, medical providers receive a fixed annual payment per patient, which is often called, prospective reimbursement.

As I reported in my previous articles about cost-shifting, a patient covered by a capitated group plan presents different financial incentives about key decisions to a doctor and the health care organization they belong to, compared with a patient covered by a fee-for-service plan.

For example, if a capitated patient has back pain, the provider and the health organization do not get paid for additional care; whereas, for a patient under fee-for-service, the provider and the organization get paid for each service rendered. Workers’ compensation, the study points out, almost always reimburses on a fee-for-service basis.

Another question the study raised was, “to what extent do the financial incentives facing providers and their health care organizations that arise out of capitation influence the determination of whether or not a case is work-related?

The decision of where to send the bill, the study says, should align with the physician’s assessment of whether the cause was work-related or not. It is the amount of uncertainty about the cause of the medical condition that provides the opportunity, according to the WCRI, for the financial incentives to influence the decision.

How the ACA ties into this is apparent in my post, “Accountable Care Organizations May Shift Claims into Workers’ Comp.” According to the WCRI, the ACA promotes the growth of ACO’s, which will increasingly integrate care from all providers under one capitated payment. They will receive one fixed payment regardless of the treatment the patient receives.

This, they say, will provide strong incentives to classify injuries as workers’ comp cases where possible. To date, over 500 ACO’s have been formed since passage of the ACA.

Additionally, the Obama Administration’s proposed moving to “value-based” reimbursement systems for physicians under Medicare (see my post, “Challenges Remain in Physician Payment Reform”), is also cited in the study as another mechanism leading to case shifting.

The WCRI states that the exact definition of this system is unclear, but that it is widely understood that this would imply more prospective reimbursement.

They point to research that indicates that when Medicare changes its payment system, there is a significant price change among commercial insurers. This, too, could further induce shifting of certain cases, they report. (see “Shared Savings ACO Program reaps the most for Primary-care Physicians”)

What are the findings?

The WCRI looked at three groups of states. The first group was states where capitated plans were very common, the second group was states where capitated plans were somewhat common, and the third group was states where capitated plans were less common.

Case-shifting was only found in states where capitated plans were very common, and there was little case-shifting in the other two groups.

Case-shifting to workers’ comp, the study implies, will be expected to increase as capitation becomes more common.

Here are the key takeaways:

  • Patients covered by a capitated health plan was 11% more likely to have a soft tissue injury (back pain) called work-related than a patient covered by fee-for-service.
  • Patients with conditions for more certain causes (fractures, lacerations, contusions), there was no difference between patients covered by capitation or by fee-for-service; hence no case-shifting.
  • Case-shifting was more likely in states where a higher percentage of workers were covered by capitated plans. Two reasons for this are: more cases would be shifted if more patients were covered by such plans, and when these plans were more common, providers were more aware of the financial incentives to case-shift. In states where at least 22% of workers had capitated plans, the odds of a soft tissue injury being work-related was 31% higher than workers in fee-for-service.
  • In states where capitation was less common, there was no case-shifting. Providers were less aware of financial incentives when capitation was infrequent.

What does this mean?

This study confirms what I have been reporting on for much of the past half year, that the ACA may lead to more claims (or cases) shifted into workers’ comp, thus adding to the cost of medical care under workers’ comp, and further burdening an already burdened and broken system.

But it also confirms that there are rough times ahead for the industry, and that unless new ideas are brought forth and alternatives are seriously considered, and not outright dismissed just because someone say they should be dismissed, no matter how many years’ experience they have in workers’ comp, things will get worse.

The world is changing. Things once thought impossible are possible. Ideas once ridiculed are now accepted reality. No one can stop change, not by saying so, nor by any action on their part, so you might as well open your eyes, ears and minds to new ideas, and not shut them just because you don’t agree with them. One day soon, you will be gone, and the problems will still be there. The way forward is to embrace change now so that the future is better for all.

Clarification

Some of you may be thrown off by the title of this article as meaning that the study confirms that the ACA will lead to case-shifting. That is not what was meant. What was meant was that the study confirms what had been previously reported by others and that I had written about in the posts I referenced in my article. If there was any misconstruction on my part, I apologize.

Quiz Time

Since this is my official 60th post (3 previous posts were from other blogs), I thought I’d do something fun and give you all a quiz.

Below you will find several quotes relating to health and health care. Your job is to match up the quote with the person who said it. Submit your answers to me in Comments, and I will respond as to whether or not you got the right answers or not.

Good luck!

Quote Quiz

And Now For Something Completely Different

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I thought I might like to go off topic and write about something other than medical tourism and its implementation into workers’ compensation.

Many of you may have certain views and beliefs about the Affordable Care Act (ACA, or PPACA), and believe that government-run, tax supported health care is unconstitutional, despite what the Supreme Court ruled. However, you will be surprised to learn, as I did the other night, that some of the Founding Fathers, namely John Adams, Thomas Jefferson, Alexander Hamilton, and Jefferson’s Treasury Secretary, Albert Gallatin, supported the establishment of federal marine hospitals under an Act signed into law by John Adams in July 1798.

In an earlier life, I was a double major in Political Science and History, among other Social Science and Humanities courses, and hold a Masters’ degree in American History from New York University. Generally, when one studies American history and American politics, emphasis is usually placed on such acts as the Alien and Sedition Acts, or the very important first cases heard by the Supreme Court such as Marbury v Madison or McCulloch v Maryland. But the Act for the Relief of Sick and Disabled Seamen was never a part of my courses, even when I studied American social or labor history.

As reported in two separate articles in Forbes magazine in January 2011 by Rick Unger, a Forbes Contributor, Unger describes how the 5th Congress, presided over by Thomas Jefferson in the Senate, and Jonathan Dayton, the Speaker of the House, who was the youngest man to sign the Constitution, passed the first government run and mandated health insurance program.  

In the first article, “Congress Passes Socialized Medicine and Mandates Health Insurance – In 1798”, Unger explains that the Founders realized that foreign trade was essential to our young economy, and they relied on the nation’s private merchant ships and sailors to carry out that trade. What precipitated the enactment of this law was that the job of a merchant sailor was very dangerous and difficult, and the sailors were exposed to tropical diseases and hurting themselves. This caused a reduction in manpower, and often left a ship’s captain without enough men to get out of port, which was bad for business and for the economy.

Recognizing that a healthy maritime workforce was needed, the Congress and the President did something about it. When it passed, it authorized the creation of a government operated marine hospital service, and mandated that privately employed sailors be required to purchase health insurance.

The Marine Hospital Service was a series of hospitals built and operated by the federal government to treat injured and ailing, privately employed sailors. It was paid for by a mandatory tax on the sailors (a little more than 1% of their wages) that was withheld from their pay and turned over to the government by the ship’s owner. This was not optional, if you wanted the job, you had to pay.

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Ships were no longer permitted to sail in and out of our ports without the health care tax being paid. This was the first national payroll tax. A sick or injured sailor would be given a voucher (in those days they actually paid off) once his payments were confirmed to have been collected and paid to the government, then the voucher would allow them to be admitted to the hospitals.

A few of these hospitals were privately operated, but the majority of the sailors were treated at federal maritime hospitals. This was expanded to include the Mississippi and Ohio rivers. This program eventually became the Public Health Service, and still exists today.

The second article, “Thomas Jefferson Also Supported Government Run Health Care”, published in Forbes four days after the first article, confirms that other Founding Fathers supported the idea of mandated health coverage and a government run hospital system.

So what does this mean? It means that the Tea Party/Libertarian/GOP attempts to overturn the ACA (aka Obamacare) because it mandates that all individuals purchase health insurance, is not only Constitutional, but that the very men who started this nation, Adams and Jefferson, and those who signed the Constitution, believed that such a mandated health care system for merchant sailors was necessary. And since the Constitution is for all the people, not just a certain class of people, like merchant sailors in the 18th or 19th centuries, or today’s military personnel, their spouses and children, veterans, old people, the poor or rich, white Men and a few Women in Congress who get taxpayer supported health care, but the rest of us do not.

It also means that Grover Norquist must be a Monarchist or a traitor to the Republic because he stated that his goal was to take back the country before the Socialists took over. Before learning about this Act, I thought that meant Theodore Roosevelt, Woodrow Wilson, FDR, Kennedy, Johnson, Nixon, and Obama, but now it seems it means that John Adams, Thomas Jefferson, Alexander Hamilton (Really?… Alexander Hamilton, the guy on the ten dollar bill and the guy who assumed all of the debt the original thirteen states incurred during the Revolution and started our national economy), as well as a former Treasury Secretary and Speaker of the House were Socialists, according to Norquist and the Tea Party-types. Then I guess the British Crown really was a Capitalist enterprise. Who knew? The American Revolution was fought for Socialism, except Socialism did not exist for a few more decades, and Karl Marx was not even born when this Act was passed.

So whenever anyone tells you that health care isn’t a right, that it is an entitlement and that forcing people to pay for health care is un-American, or un-Constitutional, refer them to the Act for the Relief of Sick and Disabled Seamen.