DCMedical News: Wednesday, October 19, 2022
DCMedical News is published every day both the House and the Senate are scheduled to be in session.
THE BIG STORY Wednesday, October 19, 2022
Hospitals Make Significant Progress in Public Posting of Payments Received, Followed by Insurers
In his first report on hospital price transparency, Chris Severn, Turquoise Health’s Co-Founder and CEO wrote “On January 1st, 2021, a tectonic shift occurred in the world of healthcare pricing. For the first time, hospitals were required to publish negotiated private-insurer rates, which are one of the main drivers in the cost of healthcare. In July 2022, the aftershock was bigger than the initial quake: payers were also required to disclose their negotiated rates.”
Other efforts at tracking and disclosing actual payments to hospitals have included those of CMS, chronicled here; RAND, which has published four studies to date (here) from claims and employer data; and reports on hospital non compliance from a consumer advocacy organization (PatientsRightsAdvocate.org).
The most thorough and detailed reporting of actual payments drawn from the January 2021 hospital price transparency requirement is by Severn’s start up health data company. Now Turquoise has its first report on methodology and aggregate results (here), the “Price Transparency Impact Report.”
The report shows major progress by hospitals in catching up to price posting responsibilities. “We expect the initial phase of price transparency adoption to take five years . . . But, make no mistake: we’re already well into this initial phase. After seven quarters of transparency, progress is evident. Nearly 4,200 hospitals have published negotiated rates, additionally, 80 carriers have also published rates, representing a majority of covered lives in the United States. This is a night and day difference from the state of transparency in 2020 and prior.”
Highlights: Seventy-six percent of hospitals have posted a machine-readable file. Sixty-five percent have posted a machine-readable file with negotiated rates. Sixty-three percent have posted a machine-readable file with cash rates. In addition to the hospital postings, insurers now have checked in. A top official of Turquoise has indicated that “most large payers have posted” but that “it's like someone hit a puzzle with a fire hose and asked you to put it back together. Some of these files were posted in 440,000 separate CSVs [comma-separated-values].”
The next phase: the Transparency in Coverage (TiC) rules, “TiC contained a shoppable services requirement, which is set to go into effect in phases on 1/1/2023 and 1/1/2024. In Phase 1, payers must provide an online self-service tool for patients to access cost-sharing and in/out-of-network rates for 500 pre-determined CPT codes. Phase 2 expands the requirement for the self-service tool to share results for all other items and services.”
DOCTORS, NURSES AND OTHER HEALTH PROFESSIONALS
The Review of Systems: Diligent Patient Interviewing Has Become Maximized Coding
An opinion piece in JAMA (here) calls for the end to the “Review of Systems,” and the substitution of “Evidence-Based” diagnostics in medicine. “What is documented in a patient’s medical record helps ensure continuity of care, facilitate coordination between clinicians, support quality improvement and research, can be useful in medical legal disputes, and, increasingly, makes medical care more transparent to patients. However, over the years, documentation has been increasingly driven by billing and coding requirements. One example is the review of systems (ROS). For decades, clinicians were reimbursed at a higher level by the Centers for Medicare & Medicaid Services (CMS) if visits included an ROS. For example, billing for a “comprehensive” visit was allowed if, among other required components, a “complete ROS” with inquiries about symptoms from at least 10 of 14 organ systems was documented. These financial incentives linked tradition-based care with reimbursement based care, which could be considered to be care documented largely for billing requirements.”
The essay continues, “Although it was meant to improve care, performing and documenting completion of the ROS lacked evidence for benefit and inadvertently risked some harm. The ROS can be time-consuming for both patients and clinicians to perform and document. Patients often had to complete a long questionnaire before their visits to satisfy documentation requirements. By eliciting issues that do not concern the patient and determining the clinical importance of these uncovered, often minor, issues, time is lost to address the patient’s primary concerns and important health problems.”
Insulin Rationing Joins Pill Splitting Over Cost
A report in STAT+ (here) on a study in the Annals of Internal Medicine says “Amid ongoing controversy over the cost of insulin, a new analysis finds that approximately 1.3 million people, or 16.5% of all adults with diabetes in the U.S., rationed their use of the life-saving treatment in the past year, raising the prospect of harmful and increasingly expensive health consequences. . . Roughly 14% of those with type 1 diabetes took less insulin than needed, compared with 9.5% of those with type 2 diabetes . . . Not surprisingly, rationing occurred most often among those without insurance coverage, at 29%.”
HOSPITALS, NURSING HOMES AND OTHER HEALTH CARE FACILITIES
Price Variation in Radiology Studies
Ge Bai and colleagues published a study in Radiology (here) on price variation in hospital imaging studies. They found (among other points) the average maximum negotiated price for a brain CT scan was almost 18 times as high as the minimum price offered in the same hospital, to different health plans. “More than a 10-fold gap exists between the highest and lowest negotiated price for common imaging services provided at the same hospital.”
Write the authors, “Whereas prices negotiated in commercial contracts have been increasingly moving to a percentage based on Medicare rates to improve pricing fairness and comprehensibility, our results suggest that some health plans might have negotiated prices less efficiently than other plans, including those operated by the same insurance company. Higher prices (relative to Medicare) for highest-cost services imply higher hospital profitability, which can potentially motivate hospitals to direct investments away from low-cost to high-cost imaging, regardless of incremental clinical value, and lead to inefficient spending for patients and payers.” [All italics added.]
MEDICARE, MEDICAID AND COMMERCIAL HEALTH INSURANCE
Prescription Drug Spending in Fee-for-Service Medicare, 2008-2019
A study in JAMA (here) found that “In 2019, spending on prescription drugs represented approximately 27% of total spending among fee-for-service Medicare beneficiaries enrolled in Part D, even after accounting for post-sale rebates.” An editorial to accompany the report (here) discusses the implications of this work for forthcoming negotiations of drug prices by Medicare (CMS).
PUBLICATION SCHEDULE FOR DCMEDICAL NEWS
November 14, 15, 16, 17, 18, 29, 30
December 1, 2, 5, 6, 7, 8, 12, 13, 14, 15
Notes to Fred Hyde, MD, JD, MBA, news@dcmedicalnews.org