Day Six of Good News: Massachusetts

Today’s Managing Health Care Costs Indicator is 2%

If you watch the Republican Presidential debates, you’d guess that the health care system in Massachusetts was in utter disarray.   Mitt Romney at least intermittently runs away from what’s probably the signature effort of his one-term governorship, and Newt Gingrich and others rarely go a day without throwing mud and bombs.

Here in Massachusetts, things are… much better than you might think.

• Our rate of uninsured is about 2% - the lowest in the nation
• Our current rate of health care cost inflation is no longer the highest in the nation, although it’s still far too high
• There has been a dramatic move toward contracts that include global payments, which will likely mean that providers will play an important role in modulating future health care cost increases
• The Attorney General has published meaningful cost data that has been risk adjusted.
• The state just renegotiated its Medicaid waiver, allowing continued funding for subsidies for health care coverage for the poor and near poor.

Massachusetts’ health care reform was clearly a model for the Affordable Care Act. It’s working well here –which augers well for the future of health care in the US.

I wish all a Happy New Year –and I’ll have some 2011 wrapup and health care innovations that could lower cost from my HSPH fall course “Managing Health Care Costs” over the next week.

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Day Five of Good News: Health Care Fraud

Today’s Managing Health Care Costs Indicator is $3 billion

Health care fraud is rampant and unconscionable.  Fraud fighters have made real progress in the last year.  

Many commentators think 10% or more of total health care costs represent actual fraud – as much as $250 billion a year. We’re not talking about honest mistakes (such as billing for a C-section that was necessary and actually performed but using the wrong code). We’re not talking about ‘abuse,’ such as billing for a laboratory test that was actually performed but medically necessary.  We’re talking about downright heists, like setting up a fake laboratory company, purchasing patient Medicare numbers, billing and collecting reimbursement, and shutting down the operation before anyone asks any questions. (Great Reuters story about these phantom firms at this URL)

The good news is that health care fraud is becoming more difficult due to aggressive enforcement action by the federal government, many state governments, and many private health plans.  The Department of Justice has had the second year of record settlements, including a $3 billion settlement with Glaxo Smith Kline for improper marketing of the diabetes drug Avandia, which has been associated with increased risk of heart failure.

1. Here’s why I believe health care fraud will decline in the coming years
2. New dollars for fighting health care fraud as part of the Affordable Care Act.  
3.  Improved technology to detect fraud before payment, and willingness to submit claims to preadjudication audit. Medicare and health plans historically paid bills and then “chased” fraudulent providers after the fact. In many instances, that was simply too late
4. Transition to bundled payment, which is less amenable to fraud than fee for service
5.  Increased transparency – which will make some of the egregious cases visible to journalists who can start the investigation ball rolling

Here’s a list of pending health care fraud settlements from an advocacy group, Taxpayers Against Fraud.  

Health care represents such a large part of the economy that it will never disappear.  However, I believe that current efforts are already paying off.

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Day Four of Good News: HIV Therapy

Today’s Managing Health Care Costs Indicator is 2.8 million

Click on image to enlarge. Source 

When I was in medical school, we still didn’t know what caused AIDS.

When I was in my residency, the HIV virus had been identified, but we were at best able to treat associated infections and cancer.  AZT (zidovudine) was licensed in 1987 – the year I finished my residency.   Everyone I cared for with HIV disease during my training died – most within a year of diagnosis. Some died the very hospitalization of their diagnosis.  When I moved into practice, treatment was improved a bit, but AIDS still had a 100% mortality.

Highly active antiretroviral therapy is one of the miracles of my medical lifetime.  I now frequently see patients who have had HIV for years and even decades. They have to take pills –and the pills are expensive. The pills have some dreadful side effects, too.  But the incidence of pneumocystis pneumonia and Kaposi’s Sarcoma and brain lymphomas and ophthalmologic fungal infections has plummeted.  People with HIV are living meaningful and productive lives with their disease – a huge medical success.

In the early years of highly active antiretroviral (HAART) therapy, the cost of caring for HIV patients declined. We were diagnosing people earlier, and while we spent a lot on medications, we spent far less on hospitalizations than we had in the terrible early days of the HIV epidemic. It’s estimated that HAART has saved 2.8 million years of life – and prevented 2900 cases of HIV infection of infants at birth.

But this is a blog on managing health care costs, and at $14,000 HAART is hardly cheap.  However, there is more evidence this year that treating HIV is a good bargain.

It turns out that HAART dramatically decreases the rate of transmission of HIV. Look at the chart at the top of this post. There are finally fewer global cases of HIV in 2009 than in 2008.  HIV might have peaked –and it’s this cocktail of antiretroviral medicines that have likely made the difference.

It’s rare to have medicines so expensive serve as a viable public health intervention. This is one of those heartening examples. HAART for HIV infection is a great example of how progress in medical care can yield future societal benefits and even cost savings.

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