Why Did the ACA Co-Op Program Fail? Lessons for the Health Reform Debate.

The ACA created a new type of nonprofit health insurance entity, the "Consumer Operated and Oriented Plan" ("co-op"). Most of the newly created co-ops soon lost money, and only 4 of the original 23 remain. We interviewed key stakeholders and conducted in-depth case studies of 3 of these co-ops. We discovered that politicians and regulators made it unlikely the program could succeed, that most of the co-ops did not have the management capacity to overcome these political obstacles, and that even those with good managers lacked the needed fiscal resilience. We also considered lessons suggested for those proposing a newly created "public option." The main one is that a successful public option requires a supportive political environment, strong management, and significant fiscal capacity, none of which comes easily. A better route may be a quasi-public option in which the government subcontracts the operation of its newly created plan to a private firm. Although it is uncertain whether federal regulators have the capacity to hold such private for-profit firms accountable, pragmatism suggests that a combination of public-sector regulation and private-sector implementation may be the most direct path toward a US version of affordable universal coverage.

One-year costs of medical admissions with and without a 30-day readmission and enhanced risk adjustment.

BACKGROUND: To overcome the limitations of administrative data in adequately adjusting for differences in patients' risk of readmissions, recent studies have added supplemental data from patient surveys and other sources (e.g., electronic health records). However, judging the adequacy of enhanced risk adjustment for use in assessment of 30-day readmission as a hospital quality indicator is not straightforward. In this paper, we evaluate the adequacy of risk adjustment by comparing the one-year costs of those readmitted within 30 days to those not after excluding the costs of the readmission. METHODS: In this two-step study, we first used comprehensive administrative and survey data on a nationally representative Medicare cohort of hospitalized patients to compare patients with a medical admission who experienced a 30-day readmission to patients without a readmission in terms of their overall Medicare payments during 12 months following the index discharge. We then examined the extent to which a series of enhanced risk adjustment models incorporating code-based comorbidities, self-reported health status and prior healthcare utilization, reduced the payment differences between the admitted and not readmitted groups. RESULTS: Our analytic cohort consisted 4684 index medical hospitalization of which 842 met the 30-day readmission criteria. Those readmitted were more likely to be older, White, sicker and with higher healthcare utilization in the previous year. The unadjusted subsequent one-year Medicare spending among those readmitted ($56,856) was 60% higher than that among the non-readmitted ($35,465). Even with enhanced risk adjustment, and across a variety of sensitivity analyses, one-year Medicare spending remained substantially higher (46.6%, p < 0.01) among readmitted patients. CONCLUSIONS: Enhanced risk adjustment models combining health status indicators from administrative and survey data with previous healthcare utilization are unable to substantially reduce the cost differences between those medical admission patients readmitted within 30 days and those not. The unmeasured patient severity that these cost differences most likely reflect raises the question of the fairness of programs that place large penalties on hospitals with higher than expected readmission rates.

Adoption of the Methodology for the HHS-Operated Permanent Risk Adjustment Program Under the Patient Protection and Affordable Care Act for the 2017 Benefit Year. Final rule.

The Secretary of Education (Secretary) amends the regulations implementing Parts B and C of the Individuals with Disabilities Education Act (IDEA). These conforming changes are needed to implement statutory amendments made to the IDEA by the Every Student Succeeds Act (ESSA), enacted on December 10, 2015. These regulations remove and revise IDEA definitions based on changes made to the definitions in the Elementary and Secondary Education Act of 1965 (ESEA), as amended by the ESSA, and also update several State eligibility requirements to reflect amendments to the IDEA made by the ESSA. They also update relevant cross-references in the IDEA regulations to sections of the ESEA to reflect changes made by the ESSA. These regulations also include several technical corrections to previously published IDEA Part B regulations.

Risk-adjustment methods for all-payer comparative performance reporting in Vermont.

BACKGROUND: As the emphasis in health reform shifts to value-based payments, especially through multi-payer initiatives supported by the U.S. Center for Medicare & Medicaid Innovation, and with the increasing availability of statewide all-payer claims databases, the need for an all-payer, "whole-population" approach to facilitate the reporting of utilization, cost, and quality measures has grown. However, given the disparities between the different populations served by Medicare, Medicaid, and commercial payers, risk-adjustment methods for addressing these differences in a single measure have been a challenge. METHODS: This study evaluated different levels of risk adjustment for primary care practice populations - from basic adjustments for age and gender to a more comprehensive "full model" risk-adjustment method that included additional demographic, payer, and health status factors. It applied risk adjustment to populations attributed to patient-centered medical homes (283,153 adult patients and 78,162 pediatric patients) in the state of Vermont that are part of the Blueprint for Health program. Risk-adjusted expenditure and utilization outcomes for calendar year 2014 were reported in 102 adult and 56 pediatric primary-care comparative practice profiles. RESULTS: Using total expenditures as the dependent variable for the adult population, the r2 for the model adjusted for age and gender was 0.028. It increased to 0.265 with the additional adjustment for 3M Clinical Risk Groups and to 0.293 with the full model. For the adult population at the practice level, the no-adjustment model had the highest variation as measured by the coefficient of variation (18.5) compared to the age and gender model (14.8); the age, gender, and CRG model (13.0); and the full model (11.7). Similar results were found for the pediatric population practices. CONCLUSIONS: Results indicate that more comprehensive risk-adjustment models are effective for comparing cost, utilization, and quality measures across multi-payer populations. Such evaluations will become more important for practices, many of which do not distinguish their patients by payer type, and for the implementation of incentive-based or alternative payment systems that depend on "whole-population" outcomes. In Vermont, providers, accountable care organizations, policymakers, and consumers have used Blueprint profiles to identify priorities and opportunities for improving care in their communities.

Medicare and Medicaid Programs; CY 2018 Home Health Prospective Payment System Rate Update and CY 2019 Case-Mix Adjustment Methodology Refinements; Home Health Value-Based Purchasing Model; and Home Health Quality Reporting Requirements. Final rule.

This final rule updates the home health prospective payment system (HH PPS) payment rates, including the national, standardized 60-day episode payment rates, the national per-visit rates, and the non-routine medical supply (NRS) conversion factor, effective for home health episodes of care ending on or after January 1, 2018. This rule also: Updates the HH PPS case-mix weights using the most current, complete data available at the time of rulemaking; implements the third year of a 3-year phase-in of a reduction to the national, standardized 60-day episode payment to account for estimated case-mix growth unrelated to increases in patient acuity (that is, nominal case-mix growth) between calendar year (CY) 2012 and CY 2014; and discusses our efforts to monitor the potential impacts of the rebasing adjustments that were implemented in CY 2014 through CY 2017. In addition, this rule finalizes changes to the Home Health Value-Based Purchasing (HHVBP) Model and to the Home Health Quality Reporting Program (HH QRP). We are not finalizing the implementation of the Home Health Groupings Model (HHGM) in this final rule.

Medicare Program; Medicare Shared Savings Program; Accountable Care Organizations--Revised Benchmark Rebasing Methodology, Facilitating Transition to Performance-Based Risk, and Administrative Finality of Financial Calculations. Final rule.

Under the Medicare Shared Savings Program (Shared Savings Program), providers of services and suppliers that participate in an Accountable Care Organization (ACO) continue to receive traditional Medicare fee-for-service (FFS) payments under Parts A and B, but the ACO may be eligible to receive a shared savings payment if it meets specified quality and savings requirements. This final rule addresses changes to the Shared Savings Program, including: Modifications to the program's benchmarking methodology, when resetting (rebasing) the ACO's benchmark for a second or subsequent agreement period, to encourage ACOs' continued investment in care coordination and quality improvement; an alternative participation option to encourage ACOs to enter performance-based risk arrangements earlier in their participation under the program; and policies for reopening of payment determinations to make corrections after financial calculations have been performed and ACO shared savings and shared losses for a performance year have been determined.

Medicare Program; Inpatient Rehabilitation Facility Prospective Payment System for Federal Fiscal Year 2017. Final rule.

This final rule will update the prospective payment rates for inpatient rehabilitation facilities (IRFs) for federal fiscal year (FY) 2017 as required by the statute. As required by section 1886(j)(5) of the Act, this rule includes the classification and weighting factors for the IRF prospective payment system's (IRF PPS's) case-mix groups and a description of the methodologies and data used in computing the prospective payment rates for FY 2017. This final rule also revises and updates quality measures and reporting requirements under the IRF quality reporting program (QRP).

Medicare Program; Prospective Payment System and Consolidated Billing for Skilled Nursing Facilities for FY 2017, SNF Value-Based Purchasing Program, SNF Quality Reporting Program, and SNF Payment Models Research. Final rule.

This final rule updates the payment rates used under the prospective payment system (PPS) for skilled nursing facilities (SNFs) for fiscal year (FY) 2017. In addition, it specifies a potentially preventable readmission measure for the Skilled Nursing Facility Value-Based Purchasing Program (SNF VBP), and implements requirements for that program, including performance standards, a scoring methodology, and a review and correction process for performance information to be made public, aimed at implementing value-based purchasing for SNFs. Additionally, this final rule includes additional polices and measures in the Skilled Nursing Facility Quality Reporting Program (SNF QRP). This final rule also responds to comments on the SNF Payment Models Research (PMR) project.

Patient Protection and Affordable Care Act; HHS Notice of Benefit and Payment Parameters for 2018; Amendments to Special Enrollment Periods and the Consumer Operated and Oriented Plan Program. Final rule.

This final rule sets forth payment parameters and provisions related to the risk adjustment program; cost-sharing parameters and cost-sharing reductions; and user fees for Federally-facilitated Exchanges and State-based Exchanges on the Federal platform. It also provides additional guidance relating to standardized options; qualified health plans; consumer assistance tools; network adequacy; the Small Business Health Options Programs; stand-alone dental plans; fair health insurance premiums; guaranteed availability and guaranteed renewability; the medical loss ratio program; eligibility and enrollment; appeals; consumer-operated and oriented plans; special enrollment periods; and other related topics.

Costs and Quality at the Hospital Level in the Nordic Countries.

This article develops and analyzes patient register-based measures of quality for the major Nordic countries. Previous studies show that Finnish hospitals have significantly higher average productivity than hospitals in Sweden, Denmark, and Norway and also a substantial variation within each country. This paper examines whether quality differences can form part of the explanation and attempts to uncover quality-cost trade-offs. Data on costs and discharges in each diagnosis-related group for 160 acute hospitals in 2008-2009 were collected. Patient register-based measures of quality such as readmissions, mortality (in hospital or outside), and patient safety indices were developed and case-mix adjusted. Productivity is estimated using bootstrapped data envelopment analysis. Results indicate that case-mix adjustment is important, and there are significant differences in the case-mix adjusted performance measures as well as in productivity both at the national and hospital levels. For most quality indicators, the performance measures reveal room for improvement. There is a weak but statistical significant trade-off between productivity and inpatient readmissions within 30 days but a tendency that hospitals with high 30-day mortality also have higher costs. Hence, no clear cost-quality trade-off pattern was discovered. Patient registers can be used and developed to improve future quality and cost comparisons.

[Acute pain therapy in German hospitals as competitive factor. Do competition, ownership and case severity influence the practice of acute pain therapy?]. / Akutschmerztherapie in deutschen Krankenhäusern als Wettbewerbsfaktor. Wird die Praxis der Akutschmerztherapie von Wettbewerb, Trägerschaft und Fallschwere beeinflusst?

BACKGROUND: Due to the implementation of the diagnosis-related groups (DRG) system, the competitive pressure on German hospitals increased. In this context it has been shown that acute pain management offers economic benefits for hospitals. The aim of this study was to analyze the impact of the competitive situation, the ownership and the economic resources required on structures and processes for acute pain management. MATERIAL AND METHODS: A standardized questionnaire on structures and processes of acute pain management was mailed to the 885 directors of German departments of anesthesiology listed as members of the German Society of Anesthesiology and Intensive Care Medicine (DGAI, Deutsche Gesellschaft für Anästhesiologie und Intensivmedizin). RESULTS: For most hospitals a strong regional competition existed; however, this parameter affected neither the implementation of structures nor the recommended treatment processes for pain therapy. In contrast, a clear preference for hospitals in private ownership to use the benchmarking tool QUIPS (quality improvement in postoperative pain therapy) was found. These hospitals also presented information on coping with the management of pain in the corporate clinic mission statement more often and published information about the quality of acute pain management in the quality reports more frequently. No differences were found between hospitals with different forms of ownership in the implementation of acute pain services, quality circles, expert standard pain management and the implementation of recommended processes. Hospitals with a higher case mix index (CMI) had a certified acute pain management more often. The corporate mission statement of these hospitals also contained information on how to cope with pain, presentation of the quality of pain management in the quality report, implementation of quality circles and the implementation of the expert standard pain management more frequently. There were no differences in the frequency of using the benchmarking tool QUIPS or the implementation of recommended treatment processes with respect to the CMI. CONCLUSION: In this survey no effect of the competitive situation of hospitals on acute pain management could be demonstrated. Private ownership and a higher CMI were more often associated with structures of acute pain management which were publicly accessible in terms of hospital marketing.

Patient Protection and Affordable Care Act; HHS notice of benefit and payment parameters for 2016. Final rule.

This final rule sets forth payment parameters and provisions related to the risk adjustment, reinsurance, and risk corridors programs; cost sharing parameters and cost-sharing reductions; and user fees for Federally-facilitated Exchanges. It also finalizes additional standards for the individual market annual open enrollment period for the 2016 benefit year, essential health benefits, qualified health plans, network adequacy, quality improvement strategies, the Small Business Health Options Program, guaranteed availability, guaranteed renewability, minimum essential coverage, the rate review program, the medical loss ratio program, and other related topics.

Risk-adjusted base payments can support the move to value.

Value-based care delivery and payment continue to penetrate the marketplace, redefining the roles primary care physicians are expected to play. Risk-adjusted base payments can help ensure that these physicians receive stable, predictable monthly or quarterly payments for the added responsibilities they will take on managing the health of populations through accountable care organizations, patient- centered medical homes, and other value-based organizations. As payerand provider incentives become aligned in value-based care delivery, payment arrangements should be designed to reflect that alignment.

Public and private health insurance in Germany: the ignored risk selection problem.

We investigate risk selection between public and private health insurance in Germany. With risk-rated premiums in the private system and community-rated premiums in the public system, advantageous selection in favor of private insurers is expected. Using 2000 to 2007 data from the German Socio-Economic Panel Study (SOEP), we find such selection. While private insurers are unable to select the healthy upon enrollment, they profit from an increase in the probability to switch from private to public health insurance of those individuals who have experienced a negative health shock. To avoid distorted competition between the two branches of health care financing, risk-adjusted transfers from private to public insurers should be instituted.

An efficient risk adjustment model to predict inpatient adverse events after surgery.

BACKGROUND: Risk adjustment is an important component of surgical outcomes and quality analyses. Current models include numerous preoperative variables; however, the relative contribution of these variables may be limited. This research seeks to identify a model with the fewest number of variables necessary to perform an adequate risk adjustment to predict any inpatient adverse event for use in resource-limited settings. METHODS: All patients from the National Surgical Quality Improvement Program (NSQIP) database from 2005 to 2010 were included. Outcomes were inpatient mortality or any surgical complication captured by NSQIP. Models were built by sequential addition of preoperative risk variables selected by their area under the receiver operator characteristic curve (AUC). RESULTS: Among 863,349 patients, the single variable with the highest AUC was American Society of Anesthesiologists (ASA) classification (AUC = 0.7127). AUC values reached 0.7923 with five variables (ASA classification, wound classification, functional status prior to surgery, albumin, and age) and 0.7945 with six variables. The sixth variable was one of the following: alkaline phosphatase, weight loss, principal anesthesia technique, gender, or emergency status. The model with the highest discrimination that did not require laboratories included ASA classification, functional status prior to surgery, wound classification, and age (AUC = 0.7810). Including all 66 preoperative variables produced little additional gain (AUC = 0.8006). CONCLUSIONS: Six variables are sufficient to develop a risk adjustment tool for inpatient surgical mortality and morbidity. This research has important implications for the field of surgical outcomes research by improving efficiency of data collection. This limited model can aid the expansion of risk-adjusted analyses to resource-limited settings worldwide.

How Does Risk Selection Respond to Risk Adjustment? New Evidence from the Medicare Advantage Program.

To combat adverse selection, governments increasingly base payments to health plans and providers on enrollees' scores from risk-adjustment formulae. In 2004, Medicare began to risk-adjust capitation payments to private Medicare Advantage (MA) plans to reduce selection-driven overpayments. But because the variance of medical costs increases with the predicted mean, incentivizing enrollment of individuals with higher scores can increase the scope for enrolling "overpriced" individuals with costs significantly below the formula's prediction. Indeed, after risk adjustment, MA plans enrolled individuals with higher scores but lower costs conditional on their score. We find no evidence that overpayments were on net reduced.

The impact of morbidity trajectories on identifying high-cost cases: using Taiwan's National Health Insurance as an example.

BACKGROUND: Incorporating longitudinal information into risk-adjustment models has been considered important. This study aimed to evaluate how morbidity trajectories impact risk-adjustment models in identifying high-cost cases. METHODS: Claims-based risk adjusters, with or without morbidity trajectories derived from 3-year claims from Taiwan's National Insurance System, were used to predict being a prospective high-cost user. A random sample of Taiwanese National Health Insurance enrollees continuously enrolled from 2002 to 2005 (n = 147,892) was the study sample. A logistic regression model was employed. The performance measures, based on the split analysis, included statistical indicators (c-statistics, sensitivity and predictive positive value), proportions of true cases identified by models and medical utilization of predicted cases. RESULTS: As the comprehensiveness of risk adjustment models increased, the performance of the models generally increased. The effect of adding trajectories on the model performance decreased as the comprehensiveness of the model increased. Such impact was most apparent in statistical indicators and medical utilization of the predicted groups. CONCLUSIONS: In identifying high-cost cases, adding morbidity trajectories might be necessary only for less comprehensive risk adjustment models, and its contributions came from higher c-statistics and increasing medical utilization of predicted groups.

Truly inefficient or providing better quality of care? Analysing the relationship between risk-adjusted hospital costs and patients' health outcomes.

Observed variation in hospital costs may be attributable to differences in patients' health outcomes. Previous studies have resorted to inherently incomplete outcome measures such as mortality or re-admission rates to assess this claim. This study makes use of a novel dataset of routinely collected patient-reported outcome measures (PROMs) linked to inpatient records to (i) access the degree to which cost variation is associated with variation in patients' health gain and (ii) explore how far judgement about hospital cost performance changes when health outcomes are accounted for. We use multilevel modelling to address the clustering of patients in providers and isolate unexplained cost variation. We find some evidence of a U-shaped relationship between risk-adjusted costs and outcomes for hip replacement surgery. For three other procedures (knee replacement, varicose vein and groin hernia surgery), the estimated relationship is sensitive to the choice of PROM instrument. We do not observe substantial changes in cost performance estimates when outcomes are explicitly accounted for.

[Remuneration distribution - should morbidity-dependent overall remuneration also be distributed after adjustments for morbidity?]. / Honorarverteilung - sollte die morbiditätsbedingte Gesamtvergütung auch morbiditätsadjustiert verteilt werden?

INTRODUCTION: In the 2009 reform of the German collective remuneration system for outpatient medical care, on the level of overall remuneration, the morbidity risk was transferred to the health funds fulfilling a long-term demand of physicians. Nevertheless not transferring morbidity adjustment to the levels of physician groups and singular practices can lead to budgets not related to patient needs and to incentives for risk selection for individual doctors. METHODS: The systematics of the distribution of overall remuneration in the German remuneration system for outpatient care are analysed focusing on the aspect of morbidity adjustment. Using diagnostic and pharmaceutical information of about half a million insured subjects, a risk adjustment model able to predict individual expenditures for outpatient care for different provider groups is presented. This model enables to additively split the individual care burden into several parts attributed to different physician groups. Conditions for the use of the model in the distribution of overall remuneration between physician groups are developed. A simulation of the use of diagnoses-based risk adjustment in standard service volumes then highlights the conditions for a successfull installation of standard service volumes representing a higher degree of risk adjustment. RESULTS: The presented estimation model is generally applicable for the distribution of overall remuneration to different physician groups. The simulation of standard service volumes using diagnosis-based risk adjustment does not provide a more accurate prediction of the expenditures on the level of physician practices than the age-related calculation currently used in the German remuneration system for outpatient medical care. CONCLUSION: Using elements of morbidity-based risk adjustment the current German collective system for outpatient medical care could be transformed towards a higher degree of distributional justice concerning medical care for patients and more appropriate incentives avoiding risk selection. Limitations of the applicability of risk-adjustment can be especially pointed out when a high share of lump-sum-payments is used for the remuneration of some physician groups.