Highlight on Nevada: Governor signs post-acute care study bill into law

A bill signed into law by Nevada governor Brian Sandoval calls for the establishment of a legislative committee to study the quality and funding of post-acute care in Nevada. Assembly Bill No. 242 creates a subcommittee to oversee an interim study that will examine alternatives to institutionalization as a means of providing post-acute care in Nevada. The committee will be composed of legislators selected from the Nevada Senate Standing Committee on Health and Human Services and the Nevada Assembly Standing Committee on Heath and Human Services and will consider such alternatives as home- and community-based services.

The law, which originated in the Nevada Legislative Committee on Senior Citizens, Veterans, and Adults with Special Needs, and was sponsored by the Assembly Committee on Health and Human Services, requires the study to review the funding and quality of post-acute care options in Nevada. It must include a consideration of alternatives to traditional institutionalization for post-acute care such as home- and community-based waiver programs. The study must review the costs and savings of such alternatives and provide an analysis of the benefits and detriments on the quality of life for persons receiving the post-acute care services. Additionally, the study must include information about the post-acute care quality measures that are required to be reported to Medicare, Medicaid, and the state of Nevada. The law also requires the committee to detail the state and federal funding procedures for post-acute care and report on Nevada’s current post-acute care funding formula. Any recommendations that the committee would like to submit to the legislature must be approved by a majority of the committee members.

Under Section 1915(c) of the Social Security Act, states have the option of providing long-term care in home- and community-based settings (HCBS) through the Medicaid HCBS Waiver Program. Additionally, sections 2401 to 2406 of the Patient Protection and Affordable Care Act (ACA) (P.L. 111-148) provide incentives to assist states in increasing the availability of HCBS through Medicaid. Such programs can provide both standard medical services and non-medical services. Examples of covered standard medical services could include case management services, homemaker assistance, personal care, habilitation, adult day health services, and respite care. States may also propose other services that will assist in keeping individuals at home and in their communities rather than in institutional settings. Nevada currently offers its own Home and Community Based Waiver Program (HCBW) and the Community Options Program for the Elderly that provide non-medical services to elderly individuals to assist them in remaining in their homes as an alternative to nursing homes.

The Nevada post-acute care study suggests that the state may be following a national trend toward providing more HCBS rather than institutionalized care as a means of controlling costs while keeping patients at home. A 2013 report by the American Association of Retired Persons (AARP) that examined state studies of HCBS programs concluded that most states found a lower, per-individual cost of providing such services as compared with providing traditional institutional care.

The Nevada Health Care Association (NVHCA) expressed strong support for the post-acute care study. Nevada Business Magazine is reporting that Daniel Mathis, President and CEO of the NVHCA stated, “The study is quite comprehensive, and it’s a positive move in improving care in the state.” He was further reported as stating,  “Importantly, it reviews state and federal funding for post-acute care, including the funding formula used in the state. This is critical to improving quality measurements and the overall level of care in Nevada.”

Governor Sandoval signed the legislation into law on June 1, 2015, and it goes into effect on July 1, 2015. The results of the study and recommendations for legislation must be presented by the committee to the Director of the Legislative Counsel Bureau for submission to the following year’s legislative body.

MACPAC highlights cost, quality challenges in serving vulnerable populations

The Medicaid and CHIP Payment and Access Commission highlighted the health needs and cost challenges in providing care to the diverse and vulnerable populations of Medicaid beneficiaries in its June 2015 report to Congress. The report also examines a new approach in supplemental payments in the Delivery System Reform Incentive Payment (DSRIP) programs, the coverage of adult dental benefits, Medicaid’s role in providing health services to individuals with behavioral health diagnoses and children and youth receiving child welfare assistance, and the use of psychotropic medications under Medicaid.

Background

The MACPAC, a non-partisan legislative branch agency, provides policy and data analysis that form the basis of its recommendations to Congress, HHS, and the states on issues relating to Medicaid and the Children’s Health Insurance Program (CHIP). The statute authorizing the MACPAC outlines areas of analysis, including payment, eligibility, enrollment and retention, coverage, access to care, quality of care, and the MACPAC’s interaction with Medicare and the health care system generally. The statute requires the MACPAC to submit reports—based on its public meetings and regular consults with state officials, congressional and executive branch staff, beneficiaries, health care providers, researchers, and policy experts—to Congress by March 15 and June 15 every year.

DSRIP supplemental payments

DSRIPs are a new type of Medicaid supplemental payment that support the efforts of providers to change the delivery of care, improve quality of care, and promote population health. The report states that California, Texas, Massachusetts, New Jersey, Kansas, and New York have implemented DSRIP programs, and in fiscal year 2015, a total of $3.6 billion in federal funding is available for implementing DSRIP programs in these states. The funding can go toward projects including the expansion of primary care clinics, building IT capacity, creating patient navigator programs, and placing behavioral and primary health care providers in the same location. However, states have reported that finding additional non-federal funding to finance DSRIPs presents a challenge, and data does not yet demonstrate improved health outcomes and cost savings. The MACPAC recommended that the federal government provide clear and consistent guidance and promote more effective oversight.

Dental health

The report states that poor oral health affects adults with incomes below 100 percent of the federal poverty level disproportionately. These individuals are more than three times as likely to have untreated dental issues compared to adults with incomes above 400 percent of the federal poverty level. Dental coverage is often decreased by states in lean times and increased again when the budget improves, making it difficult for beneficiaries and providers to know what services are covered. Even when coverage is available, the report states that Medicaid enrollees use these services less than other health services, possibly because of difficulty in finding a provider who accepts Medicaid. The report cites federal and state initiatives that aim to improve access to dental services.

Children and youth on welfare

Children currently or formerly served by the child welfare system—usually who have either been removed from their homes for abuse or neglect or who receive in-home child welfare services because of allegations of maltreatment—are among the vulnerable populations covered by Medicaid who are likely to become uninsured when they age out of the child welfare system. Roadblocks in the implementation new Medicaid eligibility pathways for former foster youth under the Patient Protection and Affordable Care Act (ACA) (P.L. 111-148) may produce lower than expected gains in coverage. The MACPAC encouraged states to evaluate how policy changes in Medicaid can improve the health of children involved in welfare.

Behavioral health and psychotropic medications

The report states that Medicaid is the single largest payer in the U.S. for behavioral health services, with 9 million Medicaid enrollees under age 65 having a behavioral health diagnosis. In 2011, this accounted for 20 percent of enrollees and about half of the total Medicaid expenditures (more than $131 billion total spent). These services are provided to a diverse group with different treatment needs. The MACPAC stated that it will continue to focus on the specific needs of each of these groups to shed light on the policies and interventions that could help improve care and contain costs. Given the substantial spending on psychotropic medications, the MACPAC will also continue to explore issues related to whether such drugs are being prescribed appropriately.

Outthinking the odds: insurer has predictive computer algorithm up its sleeve

Preventing unnecessary admissions is now a task being taken up by more than the government and hospitals. One insurer—Philadelphia-based Independence Blue Cross—is joining the preventable readmissions fight with a unique approach to the problem. The company is using data and a complex algorithm to identify high-risk patients so that they can be selected for heightened service in an attempt to prevent costly readmissions.

Finding risks

According to a story from a Kaiser Health News (KHN), Somesh Nigam, the Chief Informatics Officer for Independence Blue Cross,  said the company is trying to identify patients who are “likely to be hospitalized in the next three months.” The idea is to find the patients who are just on the edge of requiring hospitalization.

Algorithm

To accomplish its goal, Independence Blue Cross runs a complex algorithm on a mountain of data. The data includes billing claims, lab readings, medications, height, weight, and family history, as well as information about a patient’s neighborhood and poverty rates. The quantity of information is significant. Nigam said that the health care data is comparable to all of the data found in five Wikipedias. The idea behind the algorithm is basic. It analyzes the data entered and then generates a score for a patient based upon the patient’s estimated risk of hospital readmission.

Coach

The insurer then assigns a “health coach” to patients with high scores. The coach works with the patient to identify which services might assist that high-risk patient, in order to prevent even more costly services. One patient, John Lovine, experienced the benefit first hand when a health coach assisted him in setting up an appointment with a visiting nurse as an alternative to a costly hospital visit for bloodwork. According to Nigam, the program is working and the insurer is already seeing dropping hospitalization rates in its coverage region. Independence Blue Cross has identified 18,000 patients for the health coach program and has seen a 40 to 50 percent drop in expected hospital admission rates for patients with congestive heart failure.

Concerns

Despite the successes, a Harvard Bioethics Law Professor, Glen Cohen, expressed some concerns to KHN about the ethical implications of the algorithm. Cohen said the system raises questions about whether patients should have the right to opt out or should have to affirmatively opt in. Although Independence Blue Cross says its follows federal privacy rules, Cohen says the appropriate handling of the information is still something that is up in the air. Regardless of its final form or long-term implications, the algorithm represents a novel attempt to get a step ahead of health care costs, a step that is likely to benefit patient health as well as the insurance company’s bottom line.

 

Some hospitals dramatically inflating prices, mostly affecting uninsured

A study examining the Medicare cost reports of 50 hospitals across the country with the highest charge-to-cost ratios found that the hospitals charged patient fees that were 10 times more than the amount of their costs. Additionally, the study found that the uninsured individuals were most often charged the highest prices because public and private health insurers do not pay rates based on a hospital’s charges.

For-profit hospitals

The study found that, out of the 50 hospitals with the highest markups, 49 were for-profit hospitals. The study also revealed that 46 of the hospitals were owned by for-profit hospital systems, including one system owning 25 hospitals on the list. Additionally, 20 of the hospitals were located in Florida.

The Washington Post is reporting that the co-author of the study, Gerard Anderson, a professor at Johns Hopkins Bloomberg School of Public Health, explained that the lack of regulation may explain the inflated prices. “They are marking up the prices because no one is telling them they can’t,” he said. Additionally, he reportedly stated, “These are the hospitals that have the highest markup of all 5,000 hospitals in the United States. This means, when it costs the hospital $100, they are going to charge you, on average, $1,000.”

Uninsured most affected

The study pointed out that market forces are not likely to control the hospital prices because it is difficult for consumers to compare prices. Additionally, public and private health insurers do not set their payment rates based on hospital charges. As a result, uninsured individuals are often billed for full price and out-of-network patients and workers’ compensation insurers are also frequently required to pay a large portion of the charges.

Recommendations

The study recommended that the states and the federal government limit charge-to-cost ratios, set an all-payer rate, or require full disclosure by hospitals in order to control markups.