General hospitals, specialty hospitals and financially vulnerable patients.

In the past decade, the rapid growth of specialty hospitals focused on profitable service lines, including cardiac and orthopedic care, has prompted concerns about general hospitals' ability to compete. Critics contend specialty hospitals actively draw less-complicated, more-profitable patients with Medicare and private insurance away from general hospitals, threatening general hospitals' ability to cross-subsidize less-profitable services and provide uncompensated care. A contentious debate has ensued, but little research has addressed whether specialty hospitals adversely affect the financial viability of general hospitals and their ability to care for low-income, uninsured and Medicaid patients. Despite initial challenges recruiting staff and maintaining service volumes and patient referrals, general hospitals were generally able to respond to the initial entry of specialty hospitals with few, if any, changes in the provision of care for financially vulnerable patients, according to a new study by the Center for Studying Health System Change (HSC) of three markets with established specialty hospitals--Indianapolis, Phoenix and Little Rock, Arkansas. In addition, safety net hospitals--general hospitals that care for a disproportionate share of financially vulnerable patients--reported limited impact from specialty hospitals since safety net hospitals generally do not compete for insured patients.

Coordination of care by primary care practices: strategies, lessons and implications.

Despite calls from numerous organizations and payers to improve coordination of care, there are few published accounts of how care is coordinated in real-world primary care practices. This study by the Center for Studying Health System Change (HSC) documents strategies that a range of physician practices use to coordinate care for their patients. While there was no single recipe for coordination given the variety of patient, physician, practice and market factors, some cross-cutting lessons were identified, such as the value of a commitment to interpersonal continuity of care as a foundation for coordination. Respondents also identified the importance of system support for the standardization of office processes to foster care coordination. While larger practices may have more resources to invest, many of the innovations described could be scaled to smaller practices. Some coordination strategies resulted in improved efficiency over time for practices, but by and large, physician practices currently pursue these efforts at their own expense. In addition to sharing information on effective strategies among practices, the findings also provide policy makers with a snapshot of the current care coordination landscape and implications for initiatives to improve coordination. Efforts to provide technical support to practices to improve coordination, for example, through medical-home initiatives, need to consider the baseline more typical practices may be starting from and tailor their support to practices ranging widely in size, resources and presence of standardized care processes. If aligned with payment incentives, some of these strategies have the potential to increase quality and satisfaction among patients and providers by helping to move the health care delivery system toward better coordinated care.

A health plan work in progress: hospital-physician price and quality transparency.

Responding to large employers' interest in greater health care price and quality transparency, health plans are developing consumer tools to compare price and quality information across hospitals and physicians, but the tools' pervasiveness and usefulness are limited, according to findings from the Center for Studying Health System Change's (HSC) 2007 site visits to 12 nationally representative metropolitan communities. Many large employers view price and quality transparency as key to a broader consumerism strategy, where employees take more responsibility for medical costs, lifestyle choices and treatment decisions. Some health plans believe providing price and quality information to enrollees is a competitive advantage, while others are skeptical about the benefits and are proceeding cautiously to avoid potential unintended consequences. Health plans are in various stages of making price information available to enrollees. Plans generally provide some type of price information on inpatient and outpatient procedures and services from data based on their own negotiated prices or through aggregated health plan claims data obtained through a vendor; few plans provide price information on services in physician offices. However, the information provided often lacks specificity about individual providers, and its availability is often limited to enrollees in specific geographic areas. Health plans generally rely on third-party sources to package publicly available quality information instead of using information gleaned from their own claims or other data. Health plans' ability to advance price and quality comparison tools to the point where a critical mass of consumers trust and use the information to choose physicians and hospitals will likely have considerable influence on the ultimate success of broader health consumerism efforts.

Getting what we pay for: innovations lacking in provider payment reform for chronic disease care.

Despite wide recognition that existing physician and hospital payment methods used by health plans and other payers do not foster high-quality and efficient care for people with chronic conditions, little innovation in provider payment strategies is occurring, according to a new study by the Center for Studying Health System Change (HSC) commissioned by the California HealthCare Foundation. This is particularly disconcerting because the nation faces an increasing prevalence of chronic disease, resulting in continued escalation of related health care costs and diminished quality of life for more Americans. To date, most efforts to improve care of patients with chronic conditions have focused on paying vendors, such as disease management firms, to intervene with patients or redesigning care delivery without reforming underlying physician and hospital payment methods. While there is active discussion and anticipation of physician and hospital payment reform, current efforts are limited largely to experimental or small-scale pilot programs. More fundamental payment reform efforts in practice are virtually nonexistent. Existing payment systems, primarily fee for service, encourage a piecemeal approach to care delivery rather than a coordinated approach appropriate for patients with chronic conditions. While there is broad agreement that existing provider payment methods are not well aligned with optimal chronic disease care, there are significant barriers to reforming payment for chronic disease care, including: (1) fragmented care delivery; (2) lack of payment for non-physician providers and services supportive of chronic disease care; (3) potential for revenue reductions for some providers; and (4) lack of a viable reform champion. Absent such reform, however, efforts to improve the quality and efficiency of care for chronically ill patients are likely to be of limited success.

Health and wellness: the shift from managing illness to promoting health.

Despite an acknowledged lack of evidence of investment payoff, health plan initiatives to promote health and wellness are now commonplace, according to findings from the Center for Studying Health System Change's (HSC) 2007 site visits to 12 nationally representative metropolitan communities. Much of the impetus has come from employers--primarily large employers--that are incorporating health and wellness activities into benefit designs that place more responsibility on employees for health care decisions and costs. Health plans now offer a range of health and wellness activities, including traditional worksite health fairs, screenings and educational seminars; access to behavior modification programs, such as weight management and smoking cessation; and online tools, including health risk assessments. Engaging enrollees in these activities, however, is challenging because participation typically is voluntary. Another barrier is employee privacy concerns. More health plans and employers are turning to financial incentives to secure greater participation. Ultimately, however, the credibility of health and wellness activities as mechanisms to improve health and contain costs is dependent on evidence demonstrating their clinical and financial effectiveness, as well as consumers' acceptance and validation of their legitimacy.

Health plans target advanced imaging services: cost, quality and safety concerns prompt renewed oversight.

Faced with double-digit annual increases in the use of advanced imaging services, health plans are stepping up efforts to manage imaging utilization, maintain imaging quality and ensure patient safety, according to findings from the Center for Studying Health System Change's (HSC) 2007 site visits to 12 nationally representative metropolitan communities. Plan strategies range from informing physicians about evidence-based imaging guidelines to requiring prior authorization of services to credentialing physicians and imaging equipment. Mindful of the physician backlash against managed care in the 1990s, plans are instituting requirements they perceive to be less intrusive and burdensome for physicians. Some physicians, however, view the requirements as administratively onerous and obstacles to patient care. Depending on the experience with imaging, plans may expand utilization management to other services with rapid volume increases.

Consumer-directed health plans: mixed employer signals, complex market dynamics.

Health plans have expanded consumer-directed health plan (CDHP) product offerings--typically high-deductible health plans coupled with a spending account--and more employers are offering these products to workers, according to findings from the Center for Studying Health System Change's (HSC) 2007 site visits to 12 nationally representative metropolitan communities. In developing CDHPs, health plans are responding to a broader employer strategy to confer more responsibility on workers for their health care costs, lifestyle choices and treatment decisions. CDHP adoption by employers and consumers depends on a range of factors, including product features and employer characteristics, and varies across the 12 communities. While more large employers are introducing CDHPs into health benefit programs, adoption of CDHPs remains modest. Health plans and employers expect CDHP enrollment to grow as employers and employees become more knowledgeable about CDHP features, health plans develop more sophisticated support tools for plan enrollees, and there are more opportunities to learn from early adopters' experiences.early