Searching for best practices, and counseling patients about the costs of futile care and the availability of living wills, was temporarily put on hold by Republicans demagoguing the issue, but its reappearance is inevitable in this era of fiscal constraint. (See? There's common ground with fiscal hawks!)
How can we even out that and other disparities and save by spending the money efficiently on best practices (also known as evidence-based medicine)? That's where the 2010 Patient Protection and Affordable Care Act (ACA) comes in. Imperfect as it is (and it is imperfect), parts of ACA are directed exactly at those kinds of savings.
For more insight on savings and cost from ACA and elsewhere, I contacted Paul Van de Water, a health care finance expert at the Center for Budget Policy and Priorities, and asked him to discuss what we can do to control costs, and how ACA is supposed to help. His reply in its entirety (emphasis added):
Anyone looking at Medicare in the context of reducing long-term deficits must keep two critical — but often overlooked — facts in mind.
First, the problem of rising health costs affects the entire health care system, public and private. For over 30 years, Medicare and private-sector health care costs have grown at about the same rate per beneficiary, which shouldn't be surprising since they use the same doctors, hospitals, and medical procedures. In fact, Medicare has been a leader in adopting cost-control policies that private insurers have then widely adopted.
Second, the Affordable Care Act (ACA) holds the potential to vastly improve Medicare’s long-term financial outlook. If the law’s Medicare savings fully materialize, they will close four-fifths of the long-term shortfall in Medicare’s Hospital Insurance program. And they will shrink Medicare’s total cost in 2035 by more than one-fifth—from 7.2 percent to 5.6 percent of gross domestic product—according to Medicare’s trustees.
To achieve these savings, the ACA establishes a host of new initiatives that aim to transform Medicare into a program that rewards health care providers based on the value of their care, not the volume of their procedures. These include bundling payments for episodes of care, reducing avoidable hospital readmissions, testing and implementing new ways to increase the value of care, coordinating care under Medicare and Medicaid, informing patients and payers about the quality of health care providers, and increasing funding for comparative effectiveness research. The law also creates an Independent Payment Advisory Board that will develop and submit proposals to reduce cost growth and improve quality in both Medicare and the health care system as a whole.
These reforms will take time to plan, test, and implement. But they can succeed only if we give them a chance, and that won’t happen if health reform opponents succeed in repealing them.
Even if all of the ACA’s savings materialize, we’ll need to do more over the long run to slow the growth of health care costs in the private and public sectors alike. In the near term, however, achieving large additional savings will be difficult, since the ACA includes most of the good ideas for slowing the growth of Medicare spending. Other proposals, like increasing the age of eligibility for Medicare or replacing the program with vouchers that wouldn’t keep pace with health costs, would generally just shift costs to beneficiaries, states, and employers — and in many cases would increase total health care spending.
Given the limited possibilities for more Medicare cuts in the next five to ten years, the Congressional “supercommittee” needs to develop a balanced package of deficit-reduction measures, including significant additional revenues.
In the end, tough decisions, such as empowering an Independent Payment Advisory Board, are going to be needed to rein in costs. From the White House site
, here's what the IPAB is supposed to do:
• IPAB would recommend policies to Congress to help Medicare provide better care at lower costs. This could include ideas on coordinating care, getting rid of waste in the system, incentivizing best practices, and prioritizing primary care.
• IPAB is specifically prohibited by law from recommending any policies that ration care, raise taxes, increase premiums or cost-sharing, restrict benefits or modify who is eligible for Medicare.
From Center for American Progress
ACA’s changes in Medicare are expected to reduce the federal deficit by about $525 billion from 2010 to 2019, according to Congressional Budget Office estimates. In addition, Medicare’s share of the gross domestic product will gradually decrease over time as a result of ACA provisions.
And while ACA isn't exactly as universally beloved as Social Security and Medicare, my colleague Christopher Hughes, MD (Doctors for America) points out to me that there was overwhelming public opposition to "mandatory" participation in Medicare prior to its passage! The ACA has its critics on both left and right, but among the popular features such as the ability to keep your kids on your insurance until age 26, and an intent to do away with denials due to pre-existing conditions (still a work in progress), the attempts to control costs and improve quality and help address regional disparities is an under-appreciated and important aspect of the new law. Who knows? It might grow on us over time. Republicans certainly think so, which is why they are so keen on repealing it.
Another area besides end-of-life reforms and ACA that might impact costs is a renewed look at prevention (and remember I said that public health was underfunded? It is!) This is from Kaiser in its list of possible remedies for reining in health care costs:
Prevention - The burden of chronic diseases, such as diabetes and cardiovascular disease, has risen dramatically; both of these chronic conditions are known to be correlated with obesity, smoking, and diet, and are very expensive to treat over long periods of time. Proposals have been put forward to emphasize prevention by providing financial incentives to workers to engage in wellness and prevention, in order to decrease the prevalence of these conditions and avoid incurring the long-term costs of treatment. However, it is unclear how much prevention programs will decrease costs, since paradoxically healthier people will likely live—and use the health system—longer. For those already suffering from chronic diseases, disease management strives to improve and streamline the treatment regimen for common, chronic health conditions.
The above illustrates that even best intentions don't always save money, though it also illustrates that sometimes getting to better health incurs cost. That's a decision as a society we will have to make.
In the meantime, there's a reminder that other state level initiatives are also going on. This one strikes a chord with a lot of us:
Vermont Passes Single-Payer Health Care, World Doesn't End
In order to get single payer back on the congressional menu, we need to watch what Vermont does, and emphasize that if you're a fiscal hawk, single payer is for you
Those numbers come courtesy of the Commonwealth Fund, which commissioned the Lewin Group to take a look at AmeriCare and a few other health-care proposals in 2009. The resulting study predicts that, because of a public plan’s lower provider reimbursement rates and administrative costs, as well as its ability to negotiate down drug prices, enacting the bill would have resulted in $58.1 billion less annual health spending in 2010. It would increase the federal deficit by $188.5 billion a year, and employers would pay $61.5 billion more annually, but state and local governments would save $83.6 billion, and households a whopping $224.5 billion.
Now, that's what I call deficit reduction. And one can be for single payer and still support the positive aspects of ACA. One's a goal, the other is current policy.
The bottom line is that an already enacted law (ACA) holds great promise for bending the curve and decreasing the rate of health cost increases (aka a Washington 'cut') but not as much as single payer or expansion of Medicaid to the under 50 crowd does. If Medicare is more efficient than private payer, go with it. But any such expansion or change will be difficult to enact in any circumstances, let alone with a GOP House, and with the emphasis (wrongly) on deficit reduction instead of jobs. We have a few years left to deal with this before it becomes unmanageable, but I think a better chance of dealing sensibly with the cost issues is in my opinion with a Democrat in the WH and a Democratic Congress.
For those of you who don't think it matters, I think it does. I don't see much chance of sensible reform with Republicans in charge. It's simply a matter of looking at the data (please click this link.)
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